Aswad v. Hynes

80 A.D.2d 382, 439 N.Y.S.2d 737, 1981 N.Y. App. Div. LEXIS 10104
CourtAppellate Division of the Supreme Court of the State of New York
DecidedMay 21, 1981
StatusPublished
Cited by7 cases

This text of 80 A.D.2d 382 (Aswad v. Hynes) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aswad v. Hynes, 80 A.D.2d 382, 439 N.Y.S.2d 737, 1981 N.Y. App. Div. LEXIS 10104 (N.Y. Ct. App. 1981).

Opinion

OPINION OF THE COURT

Mahoney, P. J.

In 1977, Special Prosecutor Charles J. Hynes began an investigation into possible criminal violations at the Willow Point Nursing Home in Broome County. Pursuant to his authority under subdivision 3 of section 63 of the Executive Law, the Special Prosecutor subpoenaed petitioners to appear before an additional Grand Jury which was impaneled by order of this court in April of 1977. One of the petitioners, Doctor Spring, testified extensively.

On September 15, 1977, the State Attorney-General empowered Special Prosecutor Hynes to also bring a civil action in the name of the State of New York against petitioners and others for the recovery of alleged Medicaid overpayments. As a result, the Special Prosecutor established a bureau within his office known as the Civil Recovery Unit.

The additional Grand Jury term expired on December 1, 1977, without returning an indictment or issuing a report. In April of 1978 an ex parte motion was made before the Broome County Court by the Special Prosecutor for an order allowing disclosure of the minutes of the Grand Jury proceeding to the Civil Recovery Unit. The County Court granted the requested disclosure and ordered that the use of the Grand Jury minutes by the Civil Recovery Unit “be only in furtherance of its responsibilities for the recovery of monies owing the State of New York.”

On November 16, 1978, a civil action was commenced in Supreme Court, Broome County, by the State of New York and the County of Broome against a number of defendants, including petitioners, alleging that the defendants had engaged in a fraudulent scheme whereby they obtained nearly $2,000,000 in Medicaid overpayments. In opposition to de[384]*384fendants’ motions to dismiss the complaint, the Civil Recovery Unit served each defendant with a 114-page affidavit which included 10 pages of Dr. Spring’s testimony before the additional Grand Jury. Moreover, a 354-page transcript, including Dr. Spring’s complete testimony before the Grand Jury, accompanied the Civil Recovery Unit’s affidavit. Thereupon, "petitioners moved in Supreme Court for a protective order and for an order to suppress the public release or use of any testimony or evidence adduced at the' additional Grand Jury (CPLR 3103, subds [a], [c]). After oral argument, Special Term stayed proceedings before it and advised petitioners to move in County Court for vacatur and/or clarification of the latter court’s disclosure order. Petitioners then applied to County Court to vacate its original order. On January 23, 1980, County Court denied vacatur and made clear that the Civil Recovery Unit’s use of the Grand Jury minutes thus far was proper and within the scope of the original order. This appeal ensued.

A threshold issue in the resolution of this case is whether the Civil Recovery Unit’s ex parte application for disclosure of the Grand Jury minutes was an appropriate method for acquiring the information. While the statutes governing disclosure of Grand Jury minutes are less than clear regarding the procedure to be utilized when seeking disclosure, we find no statutory authority which would require that petitioners be given notice before disclosure (see CPL 190.25, subd 4; Judiciary Law, § 325). Ex parte applications for disclosure have been permitted by courts of this State in the past (see People v Di Napoli, 27 NY2d 229; Matter of Scotti, 53 AD2d 282).

Next, we turn to the more critical issue of whether the disclosure of the Grand Jury minutes to the Civil Recovery Unit was a proper exercise of discretion by the trial court, and, if proper, to what extent the Grand Jury minutes could be utilized. At the outset, we reject respondent’s contention that disclosure of the Grand Jury minutes would have been permissible even in the absence of a court order. CPL 190.25 (subd 4) states, in pertinent part: “For the purpose of assisting the grand jury in conducting its investigation, evidence obtained by a grand jury may be inde[385]*385pendently examined by the district attorney * * * [s]uch evidence may not be disclosed to other persons without a court order.” Although this statute should be construed to permit a Special Prosecutor empowered to conduct Grand Jury investigations to examine Grand Jury minutes without a court order (GPL 1.20, subd 32), where, as here, inspection by the Civil Recovery Unit was not to assist the Grand Jury in its investigation, disclosure to that unit without a court order would be unwarranted.

In determining whether the court-ordered disclosure was proper in the instant case, we must ascertain whether the trial court correctly balanced the public interest in disclosure against that of secrecy in Grand Jury proceedings (People v Di Napoli, 27 NY2d 229, supra). The public interest in disclosure is self-evident—it would assist the Civil Recovery Unit in recovering $2,000,000 in alleged Medicaid overpayments. Balance against this interest in disclosure are the five factors enumerated in Di Napoli (p 235): “(1) prevention of flight by a defendant who is about to be indicted; (2) protection of the grand jurors from interference from those under investigation; (3) prevention of subornation of, perjury and tampering with prospective witnesses at the trial to be held as a result of any indictment the grand jury returns; (4) protection of an innocent accused from unfounded accusations if in fact no indictment is returned; and (5) assurance to prospective witnesses that their testimony will be' kept secret so that they will be willing to testify freely.”

When these five criteria are posited against the public interest in disclosure in the instant case, it is apparent that the first three considerations are irrelevant since the criminal investigation has presumably been terminated by the Special Prosecutor. Concerning the last two criteria, we are of the view that any deleterious effects disclosure would have on the interests they seek to safeguard could be eliminated by forbidding public disclosure. In Di Napoli (27 NY2d 229, supra), the Public Service Commission was allowed to inspect the Grand Jury minutes for investigative purposes, but was prohibited from publicly disclosing them. Similarly, in the instant case, the Civil Recovery Unit was [386]*386properly allowed to inspect the Grand Jury minutes for investigative purposes, but the County Court abused its discretion in allowing the Civil Recovery Unit to disclose the Grand Jury minutes during the course of the civil litigation. Thus, the dissemination of the Grand Jury transcripts to the defendants in the civil action and the partial inclusion of such minutes in respondent’s pleadings were improper.

A careful reading of the Di Napoli case leads inexorably to the conclusion that notwithstanding disclosure to an investigatory agency, the continuing interest in Grand Jury secrecy must be balanced against the need for further disclosure by that investigative agency during the course of litigation. In the instant case, the court before which the civil litigation is pending is charged with balancing these sensitive interests before allowing further dissemination of the Grand Jury minutes through public disclosure or admission into evidence.

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Bluebook (online)
80 A.D.2d 382, 439 N.Y.S.2d 737, 1981 N.Y. App. Div. LEXIS 10104, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aswad-v-hynes-nyappdiv-1981.