*1 73 424, Brown, 1, 11, 426, rationally considered the the instant 68 U.S. 265 (1924) held that follow- (discussing positions the infamous of the victims and L.Ed. 873 scheme). may ing tracing inequita- be principle A constructive trust would Ponzi lower of the intentions of ble. frustration regardless Claremont’s created justice equity ruling demand.” but the court and court’s is understandable parties “where (5th 659, Collins, impose 624 F.2d 663 a constructive Rosenberg v. was not Cir.1980). impossible, tracing is a favor. Because the When trust in Claremont’s merely personal a claim logical way claimant has court its discretion in used are wrongdoer money, funds distributed court committed no divide the 11, at 44 ratably. Cunningham, 265 U.S. our For us to requiring error intervention. (First) 426; Restatement Restitu S.Ct. to chain the hands hold otherwise would be (1937). c., § illus. cmt. 3-6 right tion Equity to do what is of the court We will not rob under the circumstances. tracing dispute would No one court of the discretion essential lower the circum permissible under have been AF- its order is function. restitution Cunningham, ease. stances of this FIRMED. 11, 426. identified Claremont S.Ct. right imposition to seek its funds and had on the traced funds. trust
a constructive suggested that in fact funds. Howev receive traced
Claremont
er, court, discretionary exercising
authority obliged apply equity, was not Elliott,
tracing.
v.
would
trust
imposes
court
constructive
United States Court
justice
equity and
demand.” Rosen
“where
berg,
The lower court in Claremont’s impose trust a constructive Decided March inequitable it seemed to allow favor because (ar- Humble, Attorney Gary U.S. Assistant merely because the de- Claremont to benefit briefed), gued of the Attor- Office victims’ funds first. spent fendants the other TN, ney, Chattanooga, Plaintiff-Appellee. for preferred obtain a claim would Claremont briefed), (argued and Her- impose Ann C. Short if the court were over funds TN, (briefed), Knoxville, bert Moncier To the district all S. constructive trust. Defendant-Appellant. equal positions and were in the fraud victims say cannot treated such. We assessment of the the district court’s CONTIE, MILBURN and Before: were an abuse facts order NORRIS, Judges. Circuit discretion. equity, court is Sitting in the district ORDER Wall, Wilson “court conscience.” (1867). having (6 Wall.) L.Ed. banc, conscience, rehearing en lower Acting court on that *2 original panel Clearly, to the defendant’s counsel circulated judges also to all other active called Jake to members but Butcher the stand majority statements, and less than of of this trial to elicit his favorable but suggestion, judges favored the to do so. chose not Since defendant petition rehearing has been referred to opin- should have aware of Butcher’s hearing panel. ions, original provide failure to defendant with report the FBI 302 is not a denial a fair panel peti- has further reviewed the regard trial with to Butcher’s substantive rehearing tion for and concludes that comments. fully issues were raised original upon sidered submission and de- Although it is true that the defendant Accordingly, cision of case. possibly helpful knew that Butcher is denied. called, as a if witness defendant’s counsel evidently prior were afraid that MERRITT, C.J., separate filed a dissent in written which examine MARTIN, J., joined. which Butcher, probably Butcher would cave in to testify pressure falsely MERRITT, Judge, dissenting. Chief against give or equivocal their client testimo- respectfully I dissent from the order of the ny. They did’not call Butcher to the stand declining grant en banc review in Butcher, because who was then federal This is a case. serious case unconsti- custody, testify voluntarily declined be- prosecutorial tutional involving misconduct governmental cause of fear of retaliation con- an obvious violation. Generated in a cerning parole. his Butcher asserted force- political atmosphere that included an earlier fully testify. that he did not want to In the indictment and statement, prior absence of a counsel would along Congressman with Democratic defenseless Butcher turned Memphis, Ford of the case a mail fraud gave equivocal testimony. or prosecution against a member the former Thus, unknown, the existence of the Jake political organiza- Butcher Democratic statement, asserts, was tion in pervades Tennessee. Politics significant. Republican prosecutors case. The alleged exculpatory describes the Memphis a young lawyer statement withheld prosecutors as aspiring politician, Democratic follows: agent purchases Butcher’s or “nominee” in banks, purchases stock in Butcher’s allegedly The FBI 302 reveals that Butcher designed manipulate price of the stock. agents approached told the that he had The indictment asserts that defendant made Schledwitz a friend to him offer some fraudulent from loans bank Butcher’s to ef- bank stock that some of Butcher’s other purchases. fectuate the stock Although friends wanted sell. frequently admitted that he assisted others disclose, prosecutors did not in financing purchases of from stock his know, did that the FBI and bank, Butcher could not remember wheth- the IRS a thirteen-page had 302 statement arranged financing he for Schledwitz. years Butcher taken seven before the further shows that Butcher trial. As the opinion suggests, stated that Schledwitz did not hold bank specifically expressly ex- [i.e., stock as a agent “trustee” nominee] or acting onerated the defendant of as Butcher’s him, never told Schledwitz he agent believed, in these transactions. would take payments care interest on a acquit statement would the defendant of loan, people and that he never directed fraud and faith. bad practice. Schledwitz’s law decision of our court does not make the connection 302 state- opinion acknowledges that calling ment and the prosecution’s represented Butcher to misconduct a seri- says: stand. It ous Judge violation and that Hull Although requires a clearly reputable had erred. below evidence is “material”: plausible affidavit when undisclosed trial counsel swore knowledge showing of the existence A does not re- changed their en- quire preponder- 302 statement a demonstration *3 (J.A. 283), the held the strategy suppressed tire ance that disclosure ev- trial ultimately was not “material” idence in the 302 statement would have that acquittal____ Bagley’s is no reasonable the because “there under defendant’s materiality trial touchstone of is a probability the “reasonable that result, 13) probability” of a (Op. p. different different.” would have been adjective important. is is panel’s argument that “defendant not whether defendant would more opinion” should have been aware of Butcher’s not than have received a different 12) (op. p. is even without the 302 statement evidence, in verdict with but whether in it misplaced these circumstances because trial, absence fair under- availability of the itself is the stood a trial verdict key. that use in examination Butcher is worthy A “reasonable confidence. no tool of There is more effective examina- probability” of a different result is ac- in such tion than written statement cordingly shown when the Government’s sig- circumstances. This could have made evidentiary suppression “undermines con- strategy. in Had the difference trial nificant fidence in the outcome of trial.” available, the defense — at-, Kyles Whitley, 115 S.Ct. put on called Butcher defendant have (citations emphasis omitted and add- rather than follow the unsuccessful stand ed). adopted in knowl- strategy the absence of panel opinion adequately does not con- edge of the statement. sider the value the 302 important point con- There is one other served at trial as the vehicle for materiality report. cerning the of the 302 impeach expert sole wit- only contained extensive ex- not ness, reasonably Jay Home. Defendant by in culpatory statements made presence tends that evidence of Home’s that but also revealed reference interview, the 1985 Butcher a fact unknown Agent Jay present at the Home was IRS trial, by been used have At was the Butcher interview. trial Home to debunk the false expert prosecution’s only witness. He was jury that was a created for disin- light prosecution presented by a false by government terested hired by as a neutral advisor who had hired review financial defendant’s records. Home fi- to trace the defendant’s been shown to have at one time made nancial records. No mention ever investigated personally the defendant for the by prosecution of in the Horne’s role IRS. investigation in 1985. The Dis- of defendant panel, impeach- recognizing while trict Court denied the defendant’s motion Brady material, ment evidence constitute trial, incorrectly four-part applying new explanation concluded O’Dell, test, articulated impeachment type satisfy this not does Cir.1986), trial for new Bagley standard newly motions based on discovered evidence. therefore, require granting does not failing recog- The District erred for a new trial. The defendant’s motion test different is when nize “impeaching” evidence absence this specifi- trial motion is based on evidence trial not does “undermine confi- cally requested but know- dence in the outcome of trial” does prosecution. high- ingly withheld “deprive a fair trial.” defendant of standard, articulated in United States first cursory Op. 87 Panel at 13. Such dismissal Bagley, 105 S.Ct. If, just process rights year defendant’s due is error. refined last — U.S.-, language suggests, Whitley, as the Kyles v. above category impeach- general meant that this held accountable for its obvious miscon- duct, granted. and a new be “material” un- ment evidence could never simply Kyles, wrong. der then the — at-, Kyles, 115 S.Ct. at (disallowing any difference impeachment evidence for
purposes). instead meant particular impeachment
that this evidence is particular material then the wrong.
court is also It seems self- *4 INDUSTRIES, INC., government’s that the use of evident SMITHS independent an neutral created a Petitioner/Cross- Respondent, impression false that would affect the jury’s testimony, so, view of Horne’s would undermine confidence NATIONAL LABOR RELATIONS the trial. BOARD, Respondent/Cross- The case the defendant and Con- Petitioner. Ford, gressman arising out of Butch- loans, separately er bank was tried in West extremely Tennessee. It was an weak finally hung jury an after earlier it re- Jackson, sulted an Tennessee. 2,May Argued Likewise, in in upper this case tried East Tennessee, Judge Hull first dismissed Decided June indictment but then it. reinstated He then eight
threw out five out of the counts at the government’s
end case and at one
point indicated that the case was so weak dismiss the entire case lack Thus,
of evidence. dealing we are not with a
strong case that one could have confidence conviction in the process problems.
absence of these due govern- is too deferential sufficiently
ment and not concerned about
protecting rights of the accused. If this
Brady violation is immaterial and does not any difference,
make when will such a viola-
tion make a difference? The decision
unfortunately message prosecu- sends a engage
tors in serious ethical lapses
and constitutional in violation of Bra-
dy Kyles impunity. We should not
permit out, message go particularly
a case like this where the
partisan political prosecu- motivation political
tion exists. Politics and statements charges pervaded opening until the end. situation,
In such a should