United States v. Gupta

848 F. Supp. 2d 491, 2012 WL 990779, 2012 U.S. Dist. LEXIS 41134
CourtDistrict Court, S.D. New York
DecidedMarch 26, 2012
DocketNo. 11 Cr. 907(JSR); No. 11 Civ. 7566(JSR)
StatusPublished
Cited by9 cases

This text of 848 F. Supp. 2d 491 (United States v. Gupta) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Gupta, 848 F. Supp. 2d 491, 2012 WL 990779, 2012 U.S. Dist. LEXIS 41134 (S.D.N.Y. 2012).

Opinion

OPINION AND ORDER

JED S. RAKOFF, District Judge.

That separate government agencies having overlapping jurisdiction will cooperate in the factual investigation of the same alleged misconduct makes perfect sense; but that they can then disclaim such cooperation to avoid their respective discovery obligations makes no sense at all.

During the factual investigation that preceded the bringing of these two actions-a criminal insider trading case and a parallel civil enforcement action, both brought against defendant Rajat Gupta-Assistant United States Attorneys (“AUSAs”) from the United States Attorney’s Office for the Southern District of New York (“USAO”) and an attorney from the United States [493]*493Securities and Exchange Commission (“SEC”) conducted joint interviews of 44 witnesses. By contrast, the SEC separately conducted interviews of only two witnesses. At the joint interviews, the only person who took notes was an FBI agent assigned to the USAO. However, the SEC attorney who attended the joint interviews subsequently prepared memoranda summarizing the portions of the interview he deemed relevant, and, in one of the separate interviews, took contemporaneous written notes of the interview.

Based on these facts, defendant Gupta argues he is entitled to disclosure of some or all of the SEC memoranda and notes through two avenues. First, in a motion made in the criminal case, he argues that the USAO has a “Brady ” obligation to review the SEC’s memoranda and notes and turn over any exculpatory evidence. See Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963). Second, in a motion made in the parallel civil action (and joined by his co-defendant there, Rajaratnam), Gupta argues that he is entitled to production of the memoranda and notes under Fed. R.Civ.P. 26(b) as “matter relevant to the subject matter involved in the action.” In response, the USAO argues that it has no Brady obligation to review the SEC’s materials, and the SEC asserts, inter alia, that its memoranda and notes are entitled to work product protection pursuant to Fed.R.Civ.P. 26(b)(3). Notwithstanding these objections, however, the SEC, joined by the USAO, has offered to have the SEC review its memoranda and notes and provide the defendant with any “Brady ” material. See Letter Brief of the Government dated Feb. 23, 2012 (“Gov’t 2/23/12 Br.”) at 1; Letter Brief of the Securities and Exchange Commission dated Feb. 23, 2012 (“SEC 2/23/12 Br.”) at 1. Despite this helpful suggestion, the Court, after full consideration, concludes that it is the USAO that must, on these facts, review the SEC’s memoranda and interview notes and disclose to defendant any “Brady” material therein.

Starting with the USAO’s Brady obligations, the Supreme Court has held that the prosecutor “has a duty to learn of any favorable evidence known to the others acting on the government’s behalf in the case, including the police.” Kyles v. Whitley, 514 U.S. 419, 437, 115 S.Ct. 1555, 131 L.Ed.2d 490 (1995); accord United States v. Avellino, 136 F.3d 249, 255 (2d Cir.1998). Where the USAO conducts a “joint investigation” with another state or federal agency, courts in this Circuit have held that the prosecutor’s duty extends to reviewing the materials in the possession of that other agency for Brady evidence. See, e.g., United States v. Upton, 856 F.Supp. 727, 749-50 (E.D.N.Y.1994) (summarizing case law). In the words of Judge Weinfeld, any argument that the Government’s duty does not extend so far merely because another agency, not the USAO, is in actual possession of the documents created or obtained as part of the joint investigation is both “hyperteehnical and unrealistic.” See United States v. Shakur, 543 F.Supp. 1059, 1060 (S.D.N.Y.1982).

Here, the USAO and the SEC jointly investigated defendant Gupta’s alleged ties to the Galleon web of insider trading led by Rajaratnam. As noted, the USAO and the SEC jointly interviewed no fewer than 44 witnesses. At the interviews, questions were put to the respective witnesses by both the AUSAs and the SEC attorney. Although neither the AUSAs nor the SEC attorney took notes during the interviews,1 [494]*494the SEC attorney, within a day or two after each interview, prepared memoranda that summarized what he felt were the relevant parts of the interviews. In preparing these memoranda, he frequently consulted with the AUSAs. See Declaration of John P. Henderson dated Feb. 7, 2012 (“Henderson Decl.”) ¶ 8.

In addition to these 44 joint interviews, the SEC interviewed only two witnesses outside the presence of the USAO or the FBI. At one of these interviews, the SEC attorney took contemporaneous notes; at the other, he again waited until after the interview to prepare a memorandum. At oral argument, at the Court’s urging, the SEC agreed to turn over the memorandum and notes from these two interviews to the USAO, which in turn agreed to review them for Brady material and furnish such material to the defense. See Transcript of Oral Argument dated Feb. 16, 2012 at 12. Accordingly, the Court need not address whether these notes and memorandum fall within the scope of any “joint investigation” conducted by the Government and the SEC. However, when it comes to the SEC’s memoranda of the 44 joint interviews, the Government resists the same procedure. Although, as noted, the SEC did voluntarily agree to review its memoranda for “Brady” material and furnish any such material to Gupta, only the USAO is in a position to adequately evaluate whether anything in the SEC memoranda constitutes “Brady ” material in the criminal case. Accordingly, the Court is obligated reach the legal issues here presented.

While the Government acknowledges the SEC and the USAO conducted “parallel” investigations, the Government asserts that they were not a “joint” investigation as that term is sometimes used in the case law. Letter Brief of the Government dated Feb. 1, 2012 (“Gov’t 2/1/12 Br.”) at 2. The Government argues that the USAO and the SEC did not work as part of the “same prosecutorial team,” that the USAO and the SEC made “independent investigatory and charging decisions,” that neither the USAO nor the SEC had control over the other’s actions in how to proceed, and that the USAO conducted much of its investigation without the SEC’s involvement through the use of wiretaps and grand jury subpoenas. See id. at 2-3. The Government contends that because the SEC was not an “arm of the prosecutor” or part of a “joint prosecution team,” the USAO’s Brady obligation does not extend to documents in the SEC’s possession. Gov’t 2/23/12 Br. at 3-4.

But whether parallel investigations are also “joint” investigations must be evaluated in light of the disclosures being requested, and when it comes to Brady disclosures, the relevant context is one of fact-gathering, not charging determinations or otherwise. For Brady

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Faisal Nabin Kashem v. William Barr
941 F.3d 358 (Ninth Circuit, 2019)
State v. Guerrera
206 A.3d 160 (Supreme Court of Connecticut, 2019)
United States v. Raniere
384 F. Supp. 3d 282 (E.D. New York, 2019)
United States v. Blaszczak
308 F. Supp. 3d 736 (S.D. Illinois, 2018)
United States v. Martoma
990 F. Supp. 2d 458 (S.D. New York, 2014)
United States v. Gupta
925 F. Supp. 2d 581 (S.D. New York, 2013)

Cite This Page — Counsel Stack

Bluebook (online)
848 F. Supp. 2d 491, 2012 WL 990779, 2012 U.S. Dist. LEXIS 41134, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-gupta-nysd-2012.