United States v. Stephen B. Deluca
663 F. App'x 875
| 11th Cir. | 2016Background
- DeLuca, president of Delco Oil, was indicted on 33 counts for submitting false financial information to lenders; convicted after two trials.
- FBI seized Delco computers and an external hard drive that contained communications between DeLuca and his attorneys.
- Parties signed a stipulation establishing a filter-team process to exclude privileged communications; a former AUSA on the filter team (Guard) disregarded the stipulation and provided potentially privileged emails to the prosecution team.
- The government produced one email (the Wachovia email) on its exhibit list before the second trial; DeLuca moved to dismiss the indictment for violation of attorney-client privilege and the stipulation.
- District court found the government had viewed privileged communications and ordered destruction of privileged materials, but denied dismissal because DeLuca failed to show demonstrable prejudice from the breach.
- On appeal, DeLuca argued the prejudice requirement should be abandoned in the digital era and urged a Kastigar-like burden on the government; the Eleventh Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether dismissal of indictment is required for government review of attorney-client privileged materials | DeLuca: deliberate intrusion into privilege warrants dismissal or a Kastigar-type presumption of prejudice given digital ease of access | Government: dismissal is inappropriate absent demonstrable prejudice; privileged materials were not used at trial and prejudice not shown | Court: Precedent requires demonstrable prejudice for dismissal; affirmed denial of dismissal |
| Whether technological changes eliminate the defendant’s burden to show prejudice | DeLuca: digital records make it impossible to show how government used privileged materials, so prejudice showing should be unnecessary | Government: existing law still applies; tech does not change burden and may even aid screening | Court: Declined to revisit precedent; tech does not eliminate burden to prove prejudice |
| Applicable remedial standard when privilege breached deliberately | DeLuca: adopt Kastigar-like proof requirement that prosecution show evidence is independent of privileged material | Government: Kastigar applies to compelled testimony, not attorney-client privilege; suppression, not dismissal, is usual remedy | Court: Kastigar not controlling here; prior circuit precedent governs and requires demonstrable prejudice |
| Allocation of burden to prove lack of prejudice | DeLuca: argues practical impossibility of proving lack of prejudice implies burden should shift to government | Government: burden remains on defendant under circuit precedent | Court: Did not change rule; defendant must show prejudice and failed to do so |
Key Cases Cited
- United States v. Ofshe, 817 F.2d 1508 (11th Cir. 1987) (dismissal requires demonstrable prejudice for intrusion on attorney-client relationship)
- United States v. Bell, 776 F.2d 965 (11th Cir. 1985) (same principle: no per se dismissal for privilege intrusion)
- United States v. Sander, 615 F.2d 215 (5th Cir. 1980) (remedy for privilege intrusion is typically suppression, not dismissal)
- United States v. Morrison, 448 U.S. 361 (1980) (dismissal not automatic; require showing of prejudice or substantial threat thereof)
- Kastigar v. United States, 406 U.S. 441 (1972) (government must prove evidence is derived from legitimate independent source when compelled testimony used)