U.S. v. Grace

526 F.3d 499

UNITED STATES of America, Plaintiff-Appellant, v. W.R. GRACE; Alan R. Stringer; Henry A. Eschenbach; Jack W. Wolter; William J. McCaig; Robert J. Bettacchi; O. Mario Favorito; Robert C. Walsh, Defendants-Appellees.

No. 06-30192.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted En Banc December 12, 2007.

Filed May 15, 2008.

James C. Kilbourne (argued), Kevin M. Cassidy and Allen M. Brabender, Attorneys, United States Department of Justice, Washington, DC; William W. Mercer, United States Attorney; Kris A. McLean, Assistant United States Attorney; Ronald J. Tenpas, Acting Assistant Attorney General, for the plaintiff-appellant.

Christopher Landau, P.C. (argued), Laurence A. Urgenson, Tyler D. Mace and Michael D. Shumsky, Kirkland & Ellis LLP, Washington, DC; Stephen R.

Brown, Charles E. McNeil and Kathleen L. DeSoto, Garlington Lohn & Robinson, PLLP, Missoula, MT, for defendant-appellee, W.R. Grace & Co.

Ronald F. Waterman, Gough, Shanahan, Johnson & Waterman, Helena, MT; David S. Krakoff and Gary A. Winters, Mayer Brown LLP, Washington, DC, for defendant-appellee, Henry A. Eschenbach.

Mike Milodragovich and W. Adam Duerk, Milodragovich, Dale, Steinbrenner & Binney, Missoula, MT; Jeremy Maltby, O'Melveny & Myers LLP, Los Angeles, CA, for defendant-appellee, Jack W. Wolter.

Palmer Hoovestal, Hoovestal Law Firm, PLLC, Helena, MT; Elizabeth Van Doren Gray, Sowell, Gray, Stepp & Laffitte, LLC, Columbia, SC; William A. Coates, Roe Cassidy Coates & Price, PA, Greenville, SC, for defendant-appellee, William J. McCaig.

Brian Gallik, Goetz, Gallik & Baldwin, P.C., Bozeman, MT; Thomas C. Frongillo, Weil, Gotshal & Manges LLP, Boston, MA; Vernon S. Broderick, Weil, Gotshal & Manges LLP, New York, NY, for defendant-appellee, Robert J. Bettacchi.

C.J. Johnson, Kalkstein Law Firm, Missoula, MT; Stephen A. Jonas and Robert Keefe, Wilmer Cutler Pickering Hale and Dorr LLP, Boston, MA, for defendant-appellee, O. Mario Favorito.

Catherine A. Laughner and Aimee M. Grmoljez, Browning Kaleczyc Berry & Hoven, P.C., Helena, MT; Stephen R. Spivack, Bradley Arant Rose & White LLP, Washington, DC; David E. Roth, Bradley Arant Rose & White LLP, Birmingham, AL, for defendant-appellee, Robert C. Walsh.

Appeal from the United States District Court for the District of Montana; Donald W. Molloy, Chief District Judge, Presiding. D.C. No. CR-05-00007-DWM.

Before: ALEX KOZINSKI, Chief Judge, HARRY PREGERSON, STEPHEN REINHARDT, ANDREW J. KLEINFELD, HAWKINS, SUSAN P. GRABER, M. MARGARET McKEOWN, KIM McLANE WARDLAW, RAYMOND C. FISHER, CARLOS T. BEA and MILAN D. SMITH, JR., Circuit Judges.

Opinion by Judge FISHER; Concurrence by Judge MICHAEL DALY HAWKINS.

FISHER, Circuit Judge:

We granted en banc review of this appeal by the government, brought pursuant to 18 U.S.C. § 3731, to resolve two questions. First, does a United States Attorney's simple certification under § 3731 that the government's interlocutory appeal in a pending criminal case is not taken for purpose of delay and that the evidence the district court suppressed or excluded is substantial proof of a fact material in the proceeding suffice to establish our jurisdiction to hear the interlocutory appeal? Second, if so, did the district court in this case have the authority to order pretrial disclosure by the government of its final list of witnesses and evidentiary documents and to exclude witnesses and evidence not timely disclosed in compliance with such orders?

First, we hold that the United States Attorney's bare certification regarding delay and materiality in accordance with the terms of § 3731 was sufficient to give us appellate jurisdiction to address the government's objections to the district court's orders. We therefore overrule our prior decisions to the extent that they conflict with our ruling today, including United States v. Loud Hawk, 628 F.2d 1139 (9th Cir.1979) (en banc), and United States v. Adrian, 978 F.2d 486 (9th Cir.1992). Second we hold that the district court did have the authority to issue and enforce its pretrial orders compelling the government to disclose its witness list and did not abuse its discretion in doing so. We therefore also overrule United States v. Hicks, 103 F.3d 837 (9th Cir.1996), to the extent that it purported to deny the district court such authority.

OVERVIEW

W.R. Grace & Co. mined and processed vermiculite ore outside Libby, Montana, from the early 1960s until the early 1990s. On February 7, 2005, the United States indicted Grace and several of its officers on numerous charges alleging that they engaged in criminal acts during the course of Grace's mining operations, related to the improper disposal of asbestos-contaminated vermiculite. The district court, recognizing the magnitude of the case — with a relevant time period spanning nearly 30 years and potentially more than a thousand victims — held a pretrial case management conference in March 2005 and thereafter entered a case management order memorializing the results of the conference.

The March 2005 order established a "firm" trial date of September 11, 2006, and set forth a discovery schedule. In pertinent part, the schedule required the government to produce "all discoverable materials specified in Fed.R.Crim.P. 16(a)" by April 29, 2005, "a preliminary list of its intended witnesses and exhibits" by May 27, 2005, and a "finalized list of witnesses and trial exhibits, including [a] finalized disclosure of prosecution's expert witnesses" by September 30, 2005. Moreover, to the extent that the parties intended to engage expert witnesses at trial, the order required "full[ ] compl[iance] with the requirements of Rule 16(a)(1)(E) and Rule 16(b)(1)(C)," including that "expert reports . . . are complete, comprehensive, accurate, and tailored to the issues on which the expert is expected to testify." The government did not object to the district court's order, and subsequently made significant disclosures in compliance with it.

On September 30, 2005, the government notified the district court that it had produced for the defendants its "final witness list and final exhibit list," but stated that the government "reserve[d] its right to update its witness list and exhibit list through the close of all evidence at trial." The government's disclosure included more than 230 witnesses.

The defendants disputed the sufficiency of the government's disclosures. On November 23, 2005, the district court issued three orders pursuant to Federal Rule of Criminal Procedure 16, chiding the government for its "impermissibly narrow view of the obligations under Brady" and clarifying the materials the government was required to produce pursuant to Rule 16.

On December 2, 2005, the parties met with the district court for a status conference. At this conference, the discussion included the sufficiency of the prosecution's expert disclosures, its compliance with the previous discovery orders, and the defendants' concern about the growing size of the government's witness list. Shortly thereafter, the district court entered an order on December 5, 2005 ("the December 2005 order"), limiting the government's presentation of witnesses at trial "to those witnesses that have been disclosed as of the filing of this Order" and limiting the reports the government experts may rely upon to those "contained in the discovery produced to date or . . . currently subject to an order of this Court requiring production."

In response to government objections, the court on February 17, 2006 clarified that, if necessary for rebuttal, the government could call unlisted witnesses and use other evidence. The government then brought an interlocutory appeal under 18 U.S.C. § 3731, challenging the district court's pretrial orders — specifically the March 2005 case management order and the court's December 2005 and February 2006 enforcement orders (collectively, the "enforcement orders").

Section 3731 provides in part:

An appeal by the United States shall lie to a court of appeals from a decision or order of a district court suppressing or excluding evidence or requiring the return of seized property in a criminal proceeding, not made after the defendant has been put in jeopardy and before the verdict or finding on an indictment or information, if the United States attorney certifies to the district court that the appeal is not taken for purpose of delay and that the evidence is a substantial proof of a fact material in the proceeding.

(Emphasis added.) Here, the United States Attorney for the District of Montana certified in the words of the statute that the government's interlocutory appeal "is not taken for purpose of delay and that the evidence excluded by the district court's order described in [the] notice of appeal is substantial proof of a fact material in the proceeding ongoing before the district court." The government contends that its unembellished certification suffices to establish appellate jurisdiction. On the merits of its appeal, the government challenges the district court's authority to require or enforce a finalized pretrial list of witnesses and trial exhibits, and argues that, even if authorized, the enforcement orders were an abuse of the court's discretion. The defendants counter that the government's § 3731 certification did not adequately establish the materiality of the excluded evidence,¹ so we lack jurisdiction to hear the government's appeal; and, in any event, the district court acted within its authority.

Adhering to existing Ninth Circuit law, a three-judge panel of this court declined to accept the government's bare certification that simply recited the language of § 3731, and requested the parties to submit supplemental briefs discussing whether the excluded evidence was in fact "substantial proof of a fact material in the proceeding." United States v. W.R. Grace, 493 F.3d 1119, 1124 (9th Cir.2007), reh'g en banc granted, 508 F.3d 882 (9th...