Court Decision Regarding Failed IRS Disclosure
In United States v. Stevens, No. 10-200-01/02, 2011 WL 4344016 (W.D. La. Sept. 14, 2011), the U.S. District Court for the Western District of Louisiana granted the defendants’ motion for a new trial after finding that the government’s failure to disclose an IRS investigation of a cooperating witness violated due process under Brady v. Maryland, 373 U.S. 83 (1963), and Giglio v. United States, 405 U.S. 150 (1972).
Robert E. Stevens (“Stevens”) and Arthur Gilmore, Jr. (“Gilmore”) were tried and convicted of violating the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(c), and the Hobbs Act, 18 U.S.C. § 1951, based on their acceptance of bribes as public officials. The government’s primary witness at trial was Eddie Hakim (“Hakim”), a local businessman and cooperating witness who had offered bribes to Stevens and Gilmore.
Hakim had begun cooperating with FBI investigators in February 2008. In October 2009, his former employer, Blake Deshotels (“Deshotels”), contacted the FBI with allegations that Hakim was hiding assets from the government and committing criminal tax violations. FBI investigators and an Assistant U.S. Attorney (“AUSA”) directed Deshotels to IRS Criminal Investigation Division (“IRS-CI”), which opened an investigation. The AUSA informed the special agent working the IRS-CI investigation that Hakim was a cooperating witness in an ongoing FBI investigation. In May 2010, approximately one month before Stevens and Gilmore were indicted, the IRS-CI special agent informed the AUSA that he had closed his investigation of Hakim. Hakim had not been informed that he was under investigation.
On the penultimate day of trial, Deshotels informed Stevens’s counsel of his allegations and the IRS investigation of Hakim. The defendants filed a motion to dismiss or, alternatively, for a new trial, arguing that the government’s failure to disclose this information violated Brady and Giglio. The district court determined the government’s conduct in this case was not so outrageous as to require dismissal, but it did find a Brady violation and granted the defendants’ motion for a new trial. The court reasoned that the undisclosed evidence was material because the case hinged on Hakim’s credibility, and because the evidence demonstrated that he was motivated to assist the FBI in order to deflect attention away from his own actions. Further, the court found that Hakim received a benefit from the government of which the jury was unaware, namely, that IRS-CI did not forward Hakim’s case to the civil side of the IRS for review after closing the criminal investigation. The court found that, without this evidence, the defendants were prevented from effectively cross-examining the government’s most important witness, and the jury was unable to properly evaluate Hakim’s testimony.