LEVAL, Circuit Judge:
The government brings interlocutory appeal from an order of the United States District Court for the Southern District of New York (William H. Pauley III, J.) denying the government's motion in limine to preclude defendant James H. Giffen from advancing a public authority defense at trial. We dismiss for lack of appellate jurisdiction.
Giffen, a United States citizen, was indicted on August 4, 2003, by a grand jury in the Southern District of New York.
The indictment alleges that Giffen paid more than eighty million dollars in bribes
The indictment asserts that by these acts Giffen violated the FCPA and also defrauded the Republic of Kazakhstan. The theory of the fraud allegations is that the money used to bribe the Kazakh officials belonged to Kazakhstan, and that Giffen participated in a fraudulent scheme to divert these moneys to the personal enrichment of the Kazakh officials. The indictment further alleges that Giffen engaged in money laundering to further and conceal the bribery and fraud. Finally, the indictment alleges that Giffen conspired to defraud the United States of its rightful tax revenues by concealing from the Internal Revenue Service ("IRS") moneys he received, and by helping other United States taxpayers to conceal income from the IRS.
In March 2004, Giffen moved under Federal Rule of Criminal Procedure 16(d)(2)(a) to compel the government to produce documents in the possession of certain government agencies that discussed Giffen and Mercator. Giffen asserted that he had been in regular contact with personnel of those agencies and wished to explore a public authority defense to the charges in the indictment. On July 2, 2004, the district court granted Giffen's motion to compel, reasoning that Giffen "provides sufficient details from publicly available sources that describe his involvement in Kazakhstan on behalf of the United States government" to entitle him to discovery. The district court noted the government's acknowledgment "that it reviewed documents relating to Giffen and Mercator" at government agencies "during the course of its investigation," and the district court stated that "Giffen is entitled to review those classified documents to assess the viability of a public authority defense."
On July 28, 2004, the government invoked the Classified Information Procedures Act ("CIPA"), 18 U.S.C. app. 3, which governs the handling of classified information in district court proceedings. CIPA § 3 authorizes the district court, upon motion by the United States, "to protect against the disclosure of any classified information disclosed by the United States to any defendant in any criminal case in a district court of the United States." CIPA § 4 regulates the discovery of classified materials:
Under CIPA § 5(a), a defendant who intends to disclose classified information at trial must give notice to the government of the information he or she intends to disclose:
CIPA § 6 prescribes the procedures to be followed by the district court when determining the admissibility of classified information. Section 6(a) requires the district court, upon motion by the government, "to conduct a hearing to make all determinations concerning the use, relevance, or admissibility of classified information that would otherwise be made during the trial or pretrial proceeding." Under Section 6(c)(1), if the court authorizes the disclosure of classified information, the United States may move that, instead of disclosure, the court order "the substitution for such classified information of a statement admitting relevant facts that the specific classified information would tend to prove" or "the substitution for such classified information of a summary of the specific classified information." Section 6(c) provides that "[t]he Court shall grant such a motion of the United States if it finds that the statement or summary will provide the defendant with substantially the same ability to make his defense as would disclosure of the specific classified information." If the court declines to permit such a substitution, and the government objects to disclosure of the classified information, the presumptive remedy is dismissal of the indictment. If the court concludes, however, that "the interests of justice would not be served by dismissal of the indictment" the court may take other steps, such as dismissing certain counts in the indictment, finding against the United States on particular issues to which the classified information is related, or precluding the testimony of witnesses. CIPA § 6(e)(2). Finally, of particular relevance to this appeal, CIPA § 7(a) provides for interlocutory appeal by the United States "from a decision or order of a district court in a criminal case authorizing the disclosure of classified information, imposing sanctions for nondisclosure of classified information, or refusing a protective order sought by the United States to prevent the disclosure of classified information."
Pursuant to CIPA § 4, the government began to provide sets of classified government documents to the court for in camera and ex parte review. In some instances the court ordered the government to turn over classified materials to Giffen. In other instances, the court permitted the government to turn over to Giffen redacted versions or summaries of the documents,
On January 10, 2005, Giffen submitted a proffer of the classified information he wished to reveal at trial in support of his public authority defense. In support of the Rule 12.3 notice, Giffen asserted that he acted "with the intention of furthering the national interest of the United States and in reliance on his ongoing communications with" government agencies, and "not with the fraudulent and corrupt intent with which he is charged." He also asserted that "[h]is belief that his conduct was neither fraudulent nor corrupt, and that it was approved by the American government was confirmed by [a government agency's] repeated exhortations to remain close to the President of Kazakhstan and by our government's continued reliance on him in sensitive situations."
Most of the proffer does not relate directly to the events at issue in the indictment. Rather, Giffen describes decades of assistance that he gave to the United States, often as an unofficial conduit between leaders of the United States and the Soviet Union. He also details extensive assistance that he gave to the United States government, first as a source of information regarding political and economic developments in the Soviet Union, and in recent years, in Kazakhstan. Giffen recounts being regularly debriefed by United States government officials, and claims that "by the time of the transactions at the heart of the indictment, Mr. Giffen understood himself to be working not only for the government of Kazakhstan, but also for . . . United States government agencies." Giffen's notice and proffer then turns to the conduct alleged in the indictment. Because Giffen's precise claims go to the heart of this appeal, we quote from his document at length:
On October 10, 2005, the district court filed its ruling. As for the government's motion to preclude Giffen from offering a public authority defense, the court denied it. The court stated that "[b]ased on Giffen's proffer, this Court will permit him to present evidence of a public authority defense," and that "[a]s an integral part of his defense, Giffen is entitled to offer evidence regarding his involvement with [agencies of the United States government]." However, the district court declined to rule on the government's motion to preclude Giffen from offering classified information in support of his public authority defense, reasoning that the motion was premature because the court was not yet in a position to rule on the admissibility of any particular classified information. The district court observed that Giffen might be entitled to additional discovery from the government, and that only at that time would he be able to make a complete CIPA § 5 proffer of the classified evidence he hoped to offer at trial.
In ruling that Giffen could offer a public authority defense at trial, the district court rejected the government's argument that Giffen failed to assert that he had disclosed illegal activities to the government. The court observed that "Giffen's proffer discloses the creation, funding and use of the Swiss bank accounts at the heart of the indictment," and that according to the proffer Giffen told the government that the Swiss accounts were in the names of foreign corporations, controlled by Kazakh officials, and were maintained secretly through "non-transparent transactions." The court emphasized that, according to the proffer, the funds in the Swiss bank accounts were used to make "consultant payments, cash withdrawals for Kazakh delegations and large jewelry purchases . . . at the instruction of President Nazarbaev or his deputies."
The court also rejected the government's argument that Giffen failed to allege facts supporting a public authority defense because he did not claim to have disclosed his conduct to the government prior to engaging in that conduct and because the government never explicitly authorized his actions. The district court stated that "the diversion of oil revenues
The government filed a notice of appeal on October 25, 2005, invoking the interlocutory jurisdiction of this court under CIPA § 7.
Because the district court did not rule on the disclosure of classified information, we dismiss this appeal for lack of appellate jurisdiction under CIPA § 7. Nevertheless, we offer some observations regarding the district court's rulings, which we hope will prove helpful.
It is common ground that we are without authority to consider this interlocutory appeal unless it comes within CIPA § 7(a). That statute provides:
18 U.S.C. app. 3, § 7(a).
Giffen argues that the district court's order does not fall within the scope of CIPA § 7(a) and that the appeal is therefore premature. He asserts it remains possible that the district court will ultimately find that there is no admissible evidence supporting Giffen's public authority defense and that he will therefore not be permitted to raise the public authority defense at trial, or that any public authority defense allowed will not call for the receipt of classified information into evidence. He argues that an interlocutory appeal will lie only after the district court has ruled that any particular item of classified material will be admitted as evidence. The government argues in support of appealability that the order "authoriz[ed] the disclosure of classified information." Id. The government relies not only on the ruling that Giffen would be allowed "to present evidence of a public authority defense," but more importantly on the court's statement that "[a]s an integral part of his defense, Giffen [would be] entitled to offer evidence regarding his involvement with [agencies of the United States government]." The government contends the latter statement authorized the disclosure of a relationship between Giffen and certain government agencies, which itself is classified.
Although we do not adopt all of Giffen's arguments, we are persuaded that interlocutory appeal is premature and not authorized by Section 7(a). While there is some ambiguity caused by the district court's statement that Giffen would be "entitled to offer evidence regarding his involvement with" government agencies, there are several indications that the court did not, in fact, intend its order to authorize the disclosure of classified information, but rather intended it only as a ruling that the allegations outlined in Giffen's proffer were sufficient, as a matter of law, to support a
First, the court stated it would construe Giffen's proffer as merely a Rule 12.3 notice of a public authority defense, explaining that Giffen would have a further opportunity to submit a CIPA § 5 proffer to determine the "admissibility of classified information." Second, the court expressly declined to rule on the government's motion to preclude Giffen from offering classified information in support of his public authority defense, stressing that the government's motion in this regard was premature. The court stated, "Until the Defendant receives the full universe of documents, he cannot make a complete and accurate CIPA § 5 proffer, and this Court cannot assess the government's motion to exclude evidence." Considering the court's words in their full context, we think the most plausible reading is that the court was upholding the legal sufficiency of Giffen's proposed public authority defense (assuming there was admissible evidence to support it), and deferring to a later time—after further discovery and receipt of a complete CIPA § 5 proffer—the conduct of a CIPA § 6 hearing and rulings on the disclosure of classified information.
Without question, the district court's ruling rejected one asserted basis for the inadmissibility of evidence—the nonviability of the defendant's legal theory of relevance. But, despite words which out of context might suggest otherwise, it had as yet neither ruled on the admissibility of any evidence, nor authorized the disclosure of classified information.
Because interlocutory appeal is not authorized at this stage, we have no power to make binding rulings on the issues the parties have argued. Nonetheless, the district court might benefit from consideration of our nonbinding discussion of these issues, when it comes to make its rulings under CIPA relating to the admission of classified information. We believe the district court may have misunderstood the requirements of a public authority defense, as applied to the facts of this case.
In its October 18 order, the court expressed the view that Giffen's proffer, assuming it was supported by admissible evidence, would justify his offer of a public
a. Actual Public Authority
Under Second Circuit law, an actual public authority defense exists where a defendant has in fact been authorized by the government to engage in what would otherwise be illegal activity. That is, the defendant's conduct was, in fact, legitimized by government action.
Whether a defendant was given governmental authorization to do otherwise illegal acts through some dialogue with government officials necessarily depends, at least in part, on precisely what was said in the exchange. Upon a close reading of Giffen's proffer, in our view it cannot demonstrate the receipt of government authorization. Although Giffen asserts that he revealed his conduct to the government officials, his disclosures, as set forth in the proffer, did not adequately reveal the illegal conduct charged in the indictment. Accordingly, the responses of Giffen's governmental interlocutors, even assuming they encouraged him to continue doing what he disclosed, neither expressed nor implied authorization to commit the criminal acts with which he is charged.
The crimes alleged, as to which Giffen claims a public authority defense, are: (a) the defrauding of the Republic of Kazakhstan by participation with Kazakh officials in a scheme whereby funds rightfully belonging to the Republic were disguised as fees to consultants or as loans and diverted to the personal enrichment of Giffen and those officials; (b) the bribery of Kazakh officials by paying millions into bank accounts indirectly owned by those officials and members of their families, as well as by giving them luxury items such
Giffen's revelations to United States officials as described in his proffer characterized these transactions very differently—in a manner that failed to reveal that the Republic of Kazakhstan was being defrauded of its funds or that Kazakh officials were bribed. To the contrary, according to his proffer, when he told United States officials about payments to secret Swiss bank accounts, he described the accounts as being used by the President of Kazakhstan "to assure that a small percentage of the revenue received from the oil and gas transactions was not diverted by the Kazakh parliament on what the President believed to be unnecessary expenditures." He told government officials that the funds were used by the President "to pay for reform programs initiated by the government, consultants' fees and other expenses as the President saw fit." These representations characterize Giffen's actions as assisting the Kazakh executive branch, in preference to the Kazakh Parliament, in using Kazakh funds for governmental purposes benefitting the Republic of Kazakhstan. They do not convey that the payments were used to bribe the Kazakh officials, nor that Kazakhstan was defrauded of its funds. In short, Giffen's disclosures to the United States government, which are the basis for his claim of authorization, failed to reveal crucial aspects of the particular crimes with which he is charged in the indictment.
We express no view of whether the scheme Giffen described to the United States officials, which involved Giffen assisting the executive branch of the Kazakh government in hiding funds from the legislative branch so as to use the funds for government purposes benefitting the Republic, constitutes a crime under the laws of Kazakhstan or the United States. But even if this is so, it would be irrelevant for purposes of this case, as Giffen is not charged with that crime. In order to obtain a judgment of conviction on these counts, the government will have to prove beyond a reasonable doubt that Giffen defrauded the Republic of Kazakhstan of its money and corruptly bribed Kazakh officials. Even if Giffen was authorized to commit a crime that is not charged in the indictment, this does not give him a defense to the crimes that are charged in the indictment. Thus, even if duly authorized United States officials had responded to Giffen, "You are hereby authorized to continue doing what you have described," this would not have constituted authorization to commit the crimes charged in the indictment.
The district court took the position that because Giffen, according to the proffer,
Because Giffen's disclosures to governmental officers of his conduct did not reveal an intention to commit the crimes charged in the indictment, their response urging him "to stay close to the President [of Kazakhstan] and continue to report," did not constitute authorization to commit the crimes charged.
b. Entrapment by Estoppel
The defense of entrapment by estoppel can be established without the defendant having received actual authorization. It depends on the proposition that the government is barred from prosecuting a person for his criminal conduct when the government, by its own actions, induced him to do those acts and led him to rely reasonably on his belief that his actions would be lawful by reason of the government's seeming authorization. In the narcotics context, we have explained, "If a drug enforcement agent solicits a defendant to engage in otherwise criminal conduct as a confidential informant, or effectively communicates an assurance that the defendant is acting under [government] authorization, and the defendant, relying thereon, commits forbidden acts in the mistaken but reasonable, good faith belief
In our view, based on the allegations in the proffer, Giffen is not entitled to assert the defense of entrapment by estoppel. As discussed above with respect to the defense of actual public authority, Giffen did not disclose the conduct alleged in the indictment. The government's response, therefore, instructing Giffen, without restrictions, to "stay close to the President and continue to report," even assuming it could be construed as encouragement to continue doing what he had revealed, was not a solicitation or encouragement of the commission of the charged crimes. Moreover, because Giffen failed to apprise the government officials that he was engaged in bribery and fraud, we do not see how Giffen could have reasonably understood the officials' response as authorization to engage in bribery and fraud. See Abcasis, 45 F.3d at 43-44 ("The defendant's conduct must remain within the general scope of the solicitation or assurance of authorization; this defense will not support a claim of an open-ended license to commit crimes in the expectation of receiving subsequent authorization."); see also United States v. Patient Transfer Serv., Inc., 413 F.3d 734, 742-43 (8th Cir.2005); United States v. West Indies Transp., Inc., 127 F.3d 299, 313 (3d Cir.1997); United States v. Treviño-Martinez, 86 F.3d 65, 70 (5th Cir.1996). Under these circumstances, the considerations of fairness that underlie estoppel do not support barring the government from prosecuting Giffen for the charged crimes, because, according to Giffen's proffer, government
c. Negation of Intent
In addition, the district court mentioned a related doctrine, sometimes described as negation of intent. This is not an affirmative defense, but rather an attempt to rebut the government's proof of the intent element of a crime by showing that the defendant had a good-faith belief that he was acting with government authorization. Such a legal theory, as distinct from actual public authority and entrapment by estoppel, has been expressly recognized only in the Eleventh Circuit, and has never been considered by this court.
The district court seemed to assume that, with respect to any crime, a defendant may raise a defense "that he honestly, albeit mistakenly, believed he was committing the charged crimes in cooperation with the government." We have great difficulty with this proposition, which would swallow the actual public authority and entrapment-by-estoppel defenses. "Such an unwarranted extension of the good faith defense would grant any criminal carte blanche to violate the law should he subjectively decide that he serves the government's interests thereby. Law-breakers would become their own judges and juries." United States v. Wilson, 721 F.2d 967, 975 (4th Cir.1983). We will assume for purposes of argument—without expressing any view on the matter—that, at least in some circumstances, a defendant may offer evidence that he lacked the intent essential to the offense charged because of his good-faith belief that he was acting on behalf of the government.
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For the reasons discussed above, we doubt that Giffen has alleged facts satisfying the elements of actual public authority or entrapment by estoppel. Once again, we emphasize that as we do not have jurisdiction to hear this interlocutory appeal, these observations are dicta and do not bind the district court. Nonetheless, the district court may find it useful to consider these observations when it returns, in the context of its rulings on Giffen's CIPA § 5 proffer, to the question whether Giffen can mount a public authority defense.
The interlocutory appeal is dismissed for lack of jurisdiction.