United States v. Spector ( 1995 )


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    UNITED STATES COURT OF APPEALS
    FOR THE FIRST CIRCUIT
    ____________________

    No. 94-1987

    UNITED STATES,

    Appellant,

    v.

    MICHAEL R. SPECTOR,

    Defendant, Appellee.

    ____________________

    APPEAL FROM THE UNITED STATES DISTRICT COURT

    FOR THE DISTRICT OF NEW HAMPSHIRE

    [Hon. Joseph A. DiClerico, U.S. District Judge] ___________________

    ____________________

    Before

    Boudin, Circuit Judge, _____________

    Campbell, Senior Circuit Judge, ____________________

    and John R. Gibson,* Senior Circuit Judge. ____________________

    ____________________

    Peter E. Papps, First Assistant United States Attorney, with whom ______________
    Paul M . Gagnon, United States Attorney, was on brief for appellant. _______________
    Douglas J. Miller, with whom Hall, Morse, Anderson, Miller & __________________ __________________________________
    Spinella, P.C. was on brief for appellee. ______________



    ____________________

    May 26, 1995
    ____________________




    ____________________

    *Of the Eighth Circuit, sitting by designation.













    CAMPBELL, Senior Circuit Judge. In the early ______________________

    1990s, the U.S. Department of Labor began an investigation of

    defendant Michael Spector and of David Murray and Bernard

    Mintz, suspecting them of having submitted false statements

    in connection with an employee benefit plan. The government

    notified counsel for all three men that it was conducting the

    investigation and that it intended to charge the three with

    criminal violations of 18 U.S.C. 1027 (1988) (ERISA) and 18

    U.S.C. 644 (1988). Among the violations under

    investigation were a false statement allegedly submitted to

    the department on January 20, 1988, and an act of

    embezzlement allegedly occurring on February 19, 1988. Since

    the violations were subject to a five-year statute of

    limitations, 18 U.S.C. 3282 (1988), the limitations periods

    for the two violations above were to expire on January 20,

    and February 19, 1993, respectively.

    On January 15, 1993, defendant Spector and the two

    others (whom we shall collectively call "defendants,"

    although this appeal relates to Spector only) asked the

    government to delay seeking an indictment in order to give

    them more time to investigate and additional opportunity to

    persuade the government to modify its position on certain

    issues. The defendants entered into a written agreement with

    the government, under which the government agreed not to file

    an information or to seek an indictment before February 26,



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    1993, in exchange for the defendants' agreement to waive a

    statute of limitations defense for charges brought on or

    before March 5, 1993 (thereby effectively extending the

    limitations period until March 5). The agreement provided

    that it would be effective "upon execution by all parties,"

    and was in fact signed by all parties. The agreement went on

    to state "that further extensions of this agreement may be

    agreed to subsequently, but only by a further writing signed

    by all parties."

    As the new March 5 deadline approached, defendants

    again sought to extend the period before the government

    brought an indictment. Defendants executed another written

    agreement on March 5. Under the terms of the second

    agreement, the government stated that it had not yet brought

    an indictment against defendants and would forebear from

    doing so until April 9, 1993. In exchange, the defendants

    agreed to extend the limitations period until April 16, 1993.

    Like the first agreement, the second agreement provided that

    it would be effective "upon execution by Murray, Spector and

    Mintz, and their respective counsel and the United States by

    its counsel." However, unlike the first agreement, this

    second agreement, though signed by defendants and their

    counsel, was not signed by counsel for the government.

    On April 16, 1993, the grand jury returned an

    initial twenty-seven count indictment against defendants. On



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    September 1, 1993, the grand jury returned a seven count

    superseding indictment. Nearly a year later, on August 15,

    1994, Spector moved to dismiss the two counts of the

    indictment that were based on the false statement and

    embezzlement described above. Spector argued that the second

    extension of the statute of limitations was not binding,

    since it was not signed by the government. Without the

    extension provided by the second agreement, Spector argued,

    the two counts were barred by the statute of limitations, as

    they were handed down after March 5, 1993, the deadline set

    by the first extension.

    The district court agreed and dismissed the two

    counts as time-barred. Although it found the first extension

    to be binding, the district court determined that the second

    extension was ineffective, having been an offer that

    explicitly required the government's signature for

    acceptance, and not permitting alternative forms of

    acceptance. The court rejected the government's contention

    that an oral agreement existed, holding that such an

    agreement would be contrary to the plain terms of the written

    agreements. The district court also rejected the

    government's argument based upon promissory estoppel, finding

    that any reliance by the government on the second extension

    was unreasonable, given that the first extension expressly

    provided that any additional extensions had to be in writing



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    and signed by all parties. The government now appeals,

    pursuant to 18 U.S.C. 3731 (1988).

    A statute of limitations defense is a waivable

    affirmative defense, not a jurisdictional bar to prosecution.

    See Acevedo-Ramos v. United States, 961 F.2d 305, 307 (1st ___ _____________ _____________

    Cir.), cert. denied, 113 S. Ct. 299 (1992). Failure to raise ____________

    the defense in a timely manner can result in its waiver, as

    can an unqualified guilty plea or other, similar "action[]

    obviously constitut[ing] a waiver of the time limitation."

    Id. at 309. Most relevantly for present purposes, several ___

    federal courts of appeals have held that an individual under

    investigation may, in order to delay indictment, expressly

    waive a statute of limitations defense prior to trial, indeed

    prior to indictment, so long as that waiver is made knowingly

    and voluntarily. See, e.g., United States v. Wild, 551 F.2d ___ ____ _____________ ____

    418, 422-24 (D.C. Cir.), cert. denied, 431 U.S. 916 (1977).1 ____________

    In these cases, like the present, the defendant has typically

    entered into a written waiver in exchange for the

    government's agreement not to indict before a certain time,

    in hopes that further discussion may result in a more

    favorable disposition or prevent an indictment altogether.


    ____________________

    1. See also United States v. Del Percio, 870 F.2d 1090, _________ ______________ __________
    1093-94 (6th Cir. 1989); United States v. Meeker, 701 F.2d ______________ ______
    685, 687-88 (7th Cir.), cert. denied, 464 U.S. 826 (1983). ____________
    See generally Case Comment, Waiver of the Statute of ______________ ____________________________
    Limitations in Criminal Prosecutions: United States v. Wild, ____________________________________________________________
    90 Harv. L. Rev. 1550, 1555 (1977).

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    The courts have enforced such agreements where voluntarily

    and knowingly made, finding that they do not violate the

    policies underlying the statute of limitations.

    The issue in this appeal is whether the district

    court erred in holding that, because of the government's

    failure to sign, the second agreement was not an effective

    waiver of defendant's rights under the statute of

    limitations. It is undisputed that if the second agreement

    is found binding, the defendant may not assert his statute of

    limitations defense. If not, however, both parties agree

    that the defendant may assert the defense and that the two

    counts of the indictment were properly dismissed as time-

    barred, since they were handed down after the deadline set by

    the first agreement. Reviewing the district court's

    decision on this issue of law de novo, Thrifty Rent-A-Car ________ ___________________

    System, Inc. v. Thrifty Cars, Inc., 831 F.2d 1177, 1181 (1st _____________ __________________

    Cir. 1987), we sustain the district court's holding that the

    second agreement was ineffective and did not constitute a

    waiver of the defendant's statute of limitations defense.

    The two agreements carefully and explicitly set forth the

    conditions under which the extensions of the limitations

    period would become effective. The first extension would

    become effective "upon execution by all parties;" the second

    extension would become effective "upon execution by Murray,

    Spector, and Mintz, and their respective counsel and the



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    United States by its counsel." The agreements go so far as

    to specify that acceptance by one of the defendants would be

    made by fax. Both agreements limited the extensions to

    definite time periods. Further extensions of the limitations

    period were permissible, "but only by a further writing

    signed by all parties." One obvious reason for spelling out

    these requirements in such detail was to remove all doubt as

    to the exact steps by which defendants' partial waiver of

    rights and the government's agreement to forbear would become

    effective. Creating such a road map told both parties

    precisely what each had to do and what each would receive in

    exchange, thus minimizing the risk (or so it might be hoped)

    of a future dispute over the consummation and meaning of the

    agreement. Unfortunately, the government failed to meet the

    explicit condition provided to effectuate the second

    extension: it failed to sign the document. Thus, by the

    plain terms of the second agreement, the extension was not

    effective. Where the parties have so deliberately set forth

    in writing the conditions necessary to make their agreement

    effective, we think it inadvisable for a court to condone

    deviation from one of the explicit terms, absent some good

    reason to do so.

    We find unpersuasive the government's argument that

    contract or estoppel principles warrant enforcement of the

    agreement, despite the government's failure to comply with



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    its plain language. We assume that principles of contract or

    estoppel may sometimes be useful in analyzing agreements like

    this, cf. United States v. Baldacchino, 762 F.2d 170, 179 ___ _____________ ___________

    (1st Cir. 1985) ("Though a matter of criminal jurisprudence,

    plea bargains are subject to contract law principles insofar

    as their application will insure the defendant what is

    reasonably due him."). But those principles do not help the

    government here.2 The second agreement expressly called for

    acceptance of the offer in the form of a signature by the

    government attorney. It did not provide for any other form

    of acceptance, whether orally3 or through performance. See ___

    Restatement (Second) of Contracts 30 (1979). The defendant

    was entitled not merely to forbearance from indictment, which

    he received, but to have the government's binding promise to _______

    forbear from indicting him, which he did not receive. That

    promise provided reassurance and certainty that he would not

    be indicted prior to the time period set forth in the

    ____________________

    2. As in United States v. Papaleo, 853 F.2d 16, 19 n.3 (1st _____________ _______
    Cir. 1985), we need not attempt to decide whether, when and
    to what degree local contract law is or may strictly be
    applicable to such agreements, since the result here would be
    the same regardless.

    3. The government argues that Spector's alleged failure to
    request a signed copy of the agreement reflects his
    understanding that an agreement existed. But this is pure
    speculation. Just as the record is devoid of any suggestion
    that the defendant sought return of a signed copy of the
    contract, it is also devoid of any suggestion that the
    government ever informed the defendant that it accepted the
    terms of the agreement and was going to forbear from
    indicting him.

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    agreement. The government's estoppel argument is similarly

    without merit. The government could not reasonably have

    relied upon the defendant's offer to extend the statute of

    limitations a second time, in the face of the express

    language in the second agreement conditioning the waiver on

    the signature of all parties and the express language in the

    first agreement allowing extensions only in writing and

    signed by all parties. The government has provided no

    evidence of any other statements or conduct by the defendant

    that could provide a separate basis for an estoppel.

    Accordingly, the second agreement, by its terms,

    was not effective and the defendant was entitled to assert

    his statute of limitations defense. The district court

    properly dismissed the two counts of the indictment as

    untimely. We recognize that the government's failure to sign

    the agreement was likely the result of some unintended

    clerical error. Nevertheless, where the government reaches

    an agreement with a potential criminal defendant, and where

    both parties expressly establish, in writing,4 the terms of


    ____________________

    4. We emphasize that we are not saying that, to be
    enforced, an agreement to extend the statute of limitations
    must be made in writing, or must be signed by the government.
    See, e.g., United States v. Doyle, 348 F.2d 715, 718-19 (2d ___ ____ _____________ _____
    Cir.) (suggesting that an implicit agreement may be
    sufficient to waive the statute of limitations defense),
    cert. denied, 382 U.S. 843 (1965). We say only that, where ____________ _____
    the parties themselves have chosen to set forth the terms in _____________________________________________________________
    writing, it makes sense to hold them to those terms, absent _______
    good reason to do otherwise.

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    their bargain and map out the conditions under which it will

    be effective, we think the parties are best held to the plain

    terms of that agreement, absent some good reason to depart.5

    That policy is more likely to increase rather than diminish

    the utility of such agreements. Were we to accept too

    lightly deviations from the explicit language, we would

    undermine the certainty the parties hope to achieve. See ___

    also Correale v. United States, 479 F.2d 944, 947 (1st Cir. ____ ________ ______________

    1979) ("[T]he most meticulous standards of both promise and

    performance must be met by prosecutors engaging in plea

    bargaining.") The latter is particularly true where, as

    here, the government subsequently seeks specific performance

    of the defendant's agreement to waive a defense.

    Affirmed. ________













    ____________________

    5. We do not see our opinion as making agreements like this
    so difficult to enforce as to cause the government to become
    reluctant to enter into them, thereby possibly harming
    defendants seeking to postpone an imminent indictment. To
    the contrary, we are signaling that agreements like this will
    be enforced as written, giving the parties more rather than
    less control over the situation. All the government had to
    do to protect itself in this case was to sign the form in
    accordance with the agreed-upon terms.

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