US v. Neely

Before WIDENER, WILKINSON, and WILLIAMS, Circuit Judges.

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Affirmed by unpublished per curiam opinion.

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COUNSEL

ARGUED: Marvin David Miller, Alexandria, Virginia, for Appel-

lant. Thomas Ernest Booth, UNITED STATES DEPARTMENT OF

JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Thomas M.

Blaylock, Roanoke, Virginia, for Appellant. Robert P. Crouch, Jr.,

United States Attorney, Karen B. Peters, Assistant United States

Attorney, UNITED STATES DEPARTMENT OF JUSTICE, Wash-

ington, D.C., for Appellee.

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Unpublished opinions are not binding precedent in this circuit. See

Local Rule 36(c).

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OPINION

PER CURIAM:

Robert Keith Neely appeals his convictions on money laundering

and narcotics charges, contending that they are invalid on several

grounds. Specifically, Neely claims that: (1) the district court erred in

refusing to dismiss for prosecutorial misconduct; (2) the Government

used documents in its investigation of Neely that he produced pursu-

ant to a use-immunity order, in violation of Neely's Fifth Amendment

right against compelled self-incrimination; (3) the Government know-

ingly allowed counsel laboring under an actual conflict of interest to

represent Neely, in violation of his Sixth Amendment right to coun-

sel; (4) the Government abused the grand jury process; (5) the district

court erred in permitting two Government case agents to remain in the

courtroom during trial; and (6) Neely's convictions on Counts Two

and Three are mutually exclusive, requiring vacatur of the conviction

on Count Three. We reject all of these contentions and accordingly

affirm Neely's convictions.

I.

The evidence presented at trial, viewed in the light most favorable

to the Government, Glasser v. United States, 315 U.S. 60, 80 (1942),

establishes the following facts. Until his convictions, Neely was an

attorney with a sole-practice law firm, R. Keith Neely, P.C., in Chris-

tiansburg, Virginia, specializing in criminal defense work. In May

1986, while representing one of several defendants in a complex drug

conspiracy case, Neely met Donald Kimbler, a private investigator

from Miami, Florida, who was working for another attorney involved

in the same case. At that time, Kimbler, a former agent for the Bureau

of Alcohol, Tobacco, and Firearms (ATF), was a small-scale cocaine

dealer in the Miami area, but had never used cocaine himself. Kim-

bler and Neely quickly became close friends, and Neely introduced

Kimbler to the use of cocaine.

At Kimbler's request, Neely introduced Kimbler to persons inter-

ested in purchasing cocaine. Neely arranged a meeting between Kim-

bler and Leigh Hurst, a drug dealer and longtime friend of Neely's.

Hurst was wary of Kimbler's former connection to ATF, and refused

to deal with Kimbler unless Neely acted as intermediary. Accord-

ingly, Neely, Hurst, and Kimbler devised an arrangement pursuant to

which Neely brokered cocaine transactions between Hurst and Kim-

bler. Neely simply was present during some transactions, but on other

occasions Neely received cocaine from Kimbler and delivered it to

Hurst, who gave money to Neely for delivery to Kimbler. In return

for his efforts, Neely received approximately $200 per ounce from

Kimbler, or one-third of Kimbler's profits; Neely also received 2.5

grams of cocaine from Hurst for every ounce Hurst purchased. Hurst

estimated that he purchased eight pounds of cocaine from Kimbler

through Neely from October 1986 through November 1987.

Neely also introduced Kimbler to Fred Roland "Butch" Franklin,

III, a high-school classmate of Neely's. As with Kimbler and Hurst,

Neely facilitated cocaine transactions between Kimbler and Franklin.

Kimbler estimated that he sold approximately 4.56 pounds of cocaine

to Franklin through Neely.

In 1987, Neely agreed to purchase a parcel of land near Claytor

Lake in Pulaski County, Virginia for $50,000. Neely was to make a

down payment of $8,000 and to pay the balance in quarterly install-

ments of $4,200. Neely, evidently unable to meet this payment sched-

ule, approached Kimbler and offered to make him a silent partner in

the land purchase. Ultimately, Kimbler made the $8,000 down pay-

ment and agreed to alternate installment payments with Neely. How-

ever, Kimbler's name was not recorded on the deed to the property,

nor was the agreement memorialized. Kimbler testified that the

$8,000 used for the down payment came from a payment he had

received for guarding a shipment of cocaine to Miami. Neely depos-

ited the $8,000 into either his personal account or one of the law

firm's corporate accounts, then drew a check on that account, payable

to the seller of the land, for $8,000. This pattern of conduct was

repeated for each quarterly payment made by Kimbler.

In August 1988, Kimbler and Neely had a disagreement concerning

the payments on the property, as a result of which Kimbler ceased to

make quarterly installment payments. Shortly thereafter, Neely sought

to make a new partnership arrangement with another friend, Michael

Giacolone, for the purpose of continuing the payments. Giacolone

gave Neely $42,000 in cash in exchange for a one-half interest in the

property; this money represented profits from drug transactions.

Neely instructed his secretary to deposit the $42,000 into his corpo-

rate and personal accounts in small increments in order to evade fed-

eral reporting requirements. Although Neely and Giacolone executed

a partnership agreement, Giacolone's name was never recorded on the

deed to the property.

The Government began to investigate Neely's activities in the late

1980s. In a 1990 case unrelated to the instant offenses, Neely pleaded

guilty to misdemeanor possession of cocaine after he was videotaped

using cocaine with a government informant. Also in 1990, Neely was

indicted on charges of tampering with a grand jury, although he evi-

dently was never prosecuted.¹

A grand jury in the Western District of Virginia returned a

fourteen-count, superseding indictment on September 22, 1992,

charging Neely with racketeering, see 18 U.S.C.A. § 1962(c) (West

1984) (Count One) (including six acts of racketeering); conspiracy to

aid and abet the distribution of marijuana and cocaine, to possess with

intent to distribute marijuana and cocaine, and to distribute marijuana

and cocaine, see 18 U.S.C.A. § 2 (West 1969), 21 U.S.C.A.

§ 841(a)(1) (West 1981) (Count Two); aiding and abetting the distri-

bution of cocaine, see 18 U.S.C.A. § 2, 21 U.S.C.A. § 841 (Count

Three); money laundering, see 18 U.S.C.A.§ 1956(a)(1)(B)(i) (West

Supp. 1995) (Counts Four through Nine); 2 distribution of marijuana,

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1 The district court dismissed the indictment because the prosecution

failed to provide exculpatory evidence to the grand jury. The Govern-

ment appealed, and we reversed on the authority of United States v.

Williams, 504 U.S. 36 (1992) (holding that prosecutor is not required to

present exculpatory evidence to the grand jury). See United States v.

Neely, 966 F.2d 1445 (4th Cir. 1992) (per curiam) (unpublished), cert.

denied, 113 S. Ct. 1261 (1993). Although the record before us is unclear,

apparently the Government did not re-indict Neely.

2 Counts Four and Five related to Neely's dealings with Kimbler

regarding the Claytor Lake property. Counts Six through Nine charged

Neely with money laundering related to his various dealings with Giaco-

lone, including the $42,000 paid by Giacolone for a one-half interest in

the Claytor Lake property (Count Seven).

4

see 21 U.S.C.A. § 841(a)(1) (Count Ten); accessory after the fact to

Giacolone's drug offenses, see 18 U.S.C.A.§ 3 (West Supp. 1995)

(Counts Eleven and Twelve); tampering with a witness, see 18

U.S.C.A. § 1512 (West Supp. 1995) (Count Thirteen); and criminal

forfeiture of certain assets and property, see 18 U.S.C.A. § 982 (West

Supp. 1995) (Count Fourteen). The district court dismissed Counts

Twelve and Thirteen and one act of racketeering prior to trial, and

Neely proceeded to trial on the remaining counts. After a two-week

trial, the jury convicted Neely of conspiracy to possess cocaine for

personal use (the lesser included offense of Count Two), aiding and

abetting the distribution of cocaine (Count Three), money laundering

(Count Seven), and distribution of marijuana (Count Ten). 3 The dis-

trict court sentenced Neely to 121 months imprisonment, but released

him on bond pending appeal.

Throughout the pretrial proceedings, trial, and post-trial proceed-

ings, Neely filed a plethora of motions seeking to exclude evidence

or to dismiss the indictment altogether. Although Neely has been

somewhat more selective in his arguments on appeal, he nevertheless

asserts a broad array of reversible errors. We address these conten-

tions seriatim.

II.

Neely first asserts that the district court erred in denying his numer-

ous motions to dismiss the indictment for prosecutorial misconduct. 4

Relying in part on the precept that, "while [the prosecutor] may strike

hard blows, he is not at liberty to strike foul ones," Berger v. United

States, 295 U.S. 78, 88 (1935), overruled on other grounds by Stirone

v. United States, 361 U.S. 212 (1960), Neely urges us to vacate his

convictions on two grounds. First, Neely claims that the Government

committed certain acts of misconduct during the course of the investi-

gation and preparation of the case against Neely. Second, Neely

claims that the Government withheld numerous pieces of exculpatory

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3 Neely's conviction for distribution of marijuana was based on his pro-

vision of marijuana to Shirley Bassett, a friend.

4 Neely moved to dismiss the indictment based on allegations of pro-

secutorial misconduct and withholding of exculpatory evidence no fewer

than five times.

evidence in violation of Brady v. Maryland, 373 U.S. 83 (1963), and

its progeny.

The duty of the Government is not to obtain a conviction, but

rather is to ensure that justice is achieved. Berger, 295 U.S. at 88. Jus-

tice is not obtained, and reversal is required, when improper conduct

by the prosecutor "so infect[s] the trial with unfairness as to make the

resulting conviction a denial of due process." Darden v. Wainright,

477 U.S. 168, 181 (1986) (internal quotation marks omitted). In order

to obtain reversal of his convictions based on misconduct by the Gov-

ernment, Neely must satisfy a two-prong test: "`(1) the prosecutor's

remarks or conduct must in fact have been improper, and (2) such

remarks or conduct must have prejudicially affected the defendant's

substantial rights so as to deprive the defendant of a fair trial.'"

United States v. Brockington, 849 F.2d 872, 875 (4th Cir. 1988)

(quoting United States v. Hernandez, 779 F.2d 456, 458 (8th Cir.

1985)). To the extent that the district court makes factual findings

regarding a defendant's claims of prosecutorial misconduct, our

review is for clear error; in the absence of such findings, however, our

review is plenary. United States v. McDonald, 61 F.3d 248, 253 (4th

Cir. 1995). We first examine the acts of misconduct alleged by Neely

and then proceed to an examination of his Brady claims.

A.

Neely claims that the Government committed three acts of miscon-

duct during the investigation and preparation of the case against him.

First, Neely contends that the Government violated its duty to inform

the district court of the existence of a conflict of interest when it

knowingly permitted Neely's former attorney, James C. Turk, Jr., to

represent Hurst despite Turk's knowledge that Hurst intended to tes-

tify against Neely. See United States v. Tatum , 943 F.2d 370, 379-80

(4th Cir. 1991) ("[W]hen a conflict situation becomes apparent to the

government, the government has a duty to bring the issue to the

court's attention and, if necessary, move for disqualification of coun-

sel."). We address this purported conflict in more detail in Part IV,

infra. For purposes of addressing Neely's prosecutorial misconduct

claim, we need only note that Turk did not represent Neely on the

instant charges; thus, any conflict that may have existed was not

related to this case, and, even if the Government did have a duty to

inform the court of the presence of a conflict, that duty did not exist

in this case. See generally Hoffman v. Leeke, 903 F.2d 280, 285-86

(4th Cir. 1990) (delineating circumstances in which attorney faces

actual conflict of interest).

Second, Neely maintains that the Government violated his Sixth

Amendment right to counsel when it, knowing that Neely was repre-

sented by counsel on pending charges of grand jury tampering,

equipped Hurst with a recording device and tape-recorded two con-

versations between Neely and Hurst. See Massiah v. United States,

377 U.S. 201 (1964) (holding that covert interrogation of defendant

after right to counsel has attached violates Sixth Amendment). Of

course, Neely is correct that, under Massiah, "[a]ny secret interroga-

tion of the defendant, from and after the finding of the indictment,

without the protection afforded by the presence of counsel" is a viola-

tion of the defendant's Sixth Amendment right to counsel. Id. at 205

(internal quotation marks omitted). The Sixth Amendment right to

counsel, however, "is offense specific. It cannot be invoked once for

all future prosecutions, for it does not attach until a prosecution is

commenced," e.g., upon the return of an indictment. McNeil v.

Wisconsin, 501 U.S. 171, 175 (1991); see also Kirby v. Illinois, 406

U.S. 682, 689 (1972) (stating that the Sixth Amendment right to coun-

sel attaches upon "the initiation of adversary judicial criminal

proceedings--whether by way of formal charge, preliminary hearing,

indictment, information, or arraignment"). Accordingly, the mere fact

that an individual has been indicted for a criminal offense does not

preclude the investigation of other suspected criminal activity:

The police have an interest . . . in investigating new or addi- tional crimes [after an individual is formally charged with one crime.] . . . [T]o exclude evidence pertaining to charges as to which the Sixth Amendment right to counsel had not attached at the time the evidence was obtained, simply because other charges were pending at that time, would unnecessarily frustrate the public's interest in the investiga- tion of criminal activities.

Maine v. Moulton, 474 U.S. 159, 179-80 (1985); see also id. at 180 n.16 ("Incriminating statements pertaining to other crimes, as to which the Sixth Amendment right has not yet attached, are, of course, admissible at a trial of those offenses."); United States v. Kidd, 12 F.3d 30, 32 (4th Cir. 1993) (same), cert. denied , 114 S. Ct. 1629 (1994).

Neely's claim that the Government violated Massiah is based on

the fact that he was represented by counsel at the time of the tape-

recorded conversations with Hurst. When the tape-recorded conversa-

tions occurred, however, Neely was represented by counsel on

charges of conspiracy to defraud the United States by interfering with

grand jury secrecy, see 18 U.S.C.A. § 371 (West 1966 & Supp. 1995),

obstruction of justice, see 18 U.S.C.A.§ 1503 (West Supp. 1995), and

criminal contempt, see 18 U.S.C.A. § 401(3) (West 1966). 5 United

States v. Neely, 966 F.2d 1445 (4th Cir. 1992) (per curiam) (unpub-

lished), cert. denied, 113 S. Ct. 1261 (1993), but had not yet been

indicted on the instant charges. Hence, although any incriminating

statements made by Neely with respect to the pending charges would

have been inadmissible, any incriminating statements made by Neely

relating to allegations not yet charged would have been admissible

against Neely at a trial on those charges. See United States v.

DeVillio, 983 F.2d 1185, 1190-91 (2d Cir. 1993) (affirming admission

of incriminating statements related to uncharged offense that were

obtained after defendants had been indicted for another crime).

Indeed, DeVillio is particularly instructive in light of the fact that in

that case, the defendants made incriminating statements that related

to both charged and uncharged offenses during the course of a

covertly recorded conversation between the defendants and a codefen-

dant acting as a government informant. In holding that the statements

related to the uncharged crime were admissible, the Second Circuit

implicitly concluded that the inadmissibility of the statements related

to the charged offense did not taint statements regarding the

uncharged offense. See id. at 1191. Hence, for the Government to tape

record Hurst's conversations with Neely in an effort to obtain evi-

dence against Neely for use in prosecuting him on the instant charges

was not improper. 6

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Third, Neely posits that the Government deliberately misled the

district court and his attorneys respecting Kimbler's condition and

ability to travel. According to Neely, the Government claimed that

Kimbler was too ill to travel from a federal prison in Missouri to Roa-

noke, Virginia to be deposed; accordingly, Neely's attorneys travelled

to Missouri to take Kimbler's deposition. Upon arriving, they discov-

ered that Kimbler was to be transferred to a federal prison in Florida

for a hearing on a motion to be released from custody. In short, Neely

argues, the Government misled the district court and defense counsel

about the need to travel to Missouri. Of course, if Neely's allegations

are true, substantial questions are raised concerning the Government's

conduct, and, unfortunately, the Government does not dispute the fac-

tual basis of this claim. Nevertheless, even if we were to assume that

the Government acted improperly, we would not reverse Neely's con-

victions because Neely made no showing that the misconduct so prej-

udiced him as to deny him a fair trial. See Brockington, 849 F.2d at

875. Indeed, the fact that Kimbler was deposed by Neely's defense

counsel prior to trial indicates that any prosecutorial misconduct with

respect to representations about Kimbler's location and condition did

not deprive Neely of a fair trial.

B.

Neely also contends that the Government's repeated failure to turn

over exculpatory evidence was a part of a pattern of misconduct and

that this misconduct constituted a due process violation. Neely alleges

five instances of nondisclosure by the Government: (1) impeachment

evidence regarding Hurst's conviction for perjury, his use of narcot-

ics, and his illegal narcotics-dealing activities; (2) impeachment mate-

rials related to Kimbler, including a tape recording of a debriefing of

Kimbler by federal agents regarding Kimbler's participation in an

interstate drug ring; (3) impeachment materials relevant to the testi-

mony of Jamel Agemy, a Government witness; (4) information relat-

ing to the Government's seeking early release and a reduction in fine

for Giacolone in exchange for his testimony; and (5) information

regarding a statement by Gary Duncan, an individual on the Govern-

ment's witness list, that Duncan and Kimbler had not used drugs

together. We address these challenges in turn, keeping in mind that

a determination of whether the Government acted improperly neces-

sarily requires a determination of whether any Brady violation in fact

occurred; if there was no Brady violation, the Government's conduct

cannot be considered improper.

Brady v. Maryland, 373 U.S 83 (1963), and its progeny require that

the Government disclose to the defense all material evidence that is

favorable to the accused. This duty applies equally to evidence that

is directly exculpatory and to evidence that allows the defendant to

impeach a witness. See United States v. Bagley , 473 U.S. 667, 676

(1985). However, the Government has no duty to disclose evidence

that could have been discovered through the exercise of due diligence

by the defendant. See United States v. Wilson , 901 F.2d 378, 380 (4th

Cir. 1990). Thus, there is no Brady violation if "the exculpatory infor-

mation is not only available to the defendant but also lies in a source

where a reasonable defendant would have looked." Id. at 381.

Not every failure to disclose favorable information requires that the

defendant's conviction be vacated; rather, "the suppression by the

prosecution of evidence favorable to an accused . . . violates due pro-

cess [only] where the evidence is material either to guilt or to punish-

ment, irrespective of the good faith or bad faith of the prosecution."

Brady, 373 U.S. at 87. Evidence is material"if there is a reasonable

probability that, had the evidence been disclosed to the defense, the

result of the proceeding would have been different." Bagley, 473 U.S.

at 682. A "reasonable probability" of a different result exists "when

the Government's evidentiary suppression `undermines confidence in

the outcome of the trial.'" Kyles v. Whitley , 115 S. Ct. 1555, 1566

(1995) (quoting Bagley, 473 U.S. at 678).

With respect to Neely's first alleged instance of nondisclosure, we

note that this claim relates to the Government's failure to disclose evi-

dence that could be used to impeach Hurst during a hearing regarding

pre-trial detention. Brady, however, is concerned only with the ques-

tion of whether the defendant received a fair trial. Because Neely

does not claim that the Government failed to provide the information

in sufficient time for it to be used at trial, see United States v. Smith

Grading & Paving, Inc., 760 F.2d 527, 532 (4th Cir.), cert. denied,

474 U.S. 1005 (1985), we conclude that Neely's first allegation of

nondisclosure does not state a cognizable Brady claim.

Similar reasoning applies to Neely's second claim of nondisclo-

sure, which relates to the Government's alleged failure to provide,

prior to the taking of Kimbler's deposition, a tape recording of a

debriefing of Kimbler that revealed his involvement in an interstate

drug conspiracy and a murder-for-hire scheme. Even if Neely did not

receive the tape recording prior to Kimbler's deposition (a fact that

is not at all clear), the parties do not dispute that the recording was

provided to defense counsel well in advance of trial. As noted above,

the fact that Neely received the tape recording in time to use it at trial

precludes a Brady claim.

With respect to Neely's third allegation of nondisclosure, the dis-

trict court found that the Government's failure to disclose two investi-

gation reports containing information useful in impeaching Agemy

constituted a Brady violation and, accordingly, excluded Agemy's

testimony. Obviously, the fact that Agemy never testified precludes

a finding that the Brady violation related to Agemy's testimony

undermines confidence in the verdict.

Neely's fourth contention is that the Government failed to reveal

that Giacolone was promised early release from prison and a reduc-

tion in fine in exchange for his testimony. The Government argues

that this contention lacks a factual basis, claiming that Giacolone in

fact received only a two-week furlough so that he could help the Gov-

ernment prepare its case and that no agreement existed between the

Government and Giacolone regarding a reduction in Giacolone's fine.

Furthermore, the Government asserts, any promises made to Giaco-

lone could have been discovered through diligent cross-examination

of Giacolone. Because this information could have been discovered

through due diligence by defense counsel, the Government posits, it

had no duty under Brady to disclose it. We agree with the Govern-

ment that any promises actually made to Giacolone could have been

discovered by defense counsel during cross-examination. Addition-

ally, we note that Brady does not necessarily require that exculpatory

information be produced prior to trial; provided the information is dis-

covered in time for its effective use by the defense, there is no Brady

violation. See Smith Grading & Paving, 760 F.2d at 532 (holding that

disclosure of exculpatory evidence during cross-examination of first

Government witness did not violate Brady). Therefore, we conclude

that there is no Brady violation here because Neely himself, through

the exercise of due diligence, could have obtained information regard-

ing any promises made to Giacolone in time to use it effectively at

Finally, Neely claims that the Government violated Brady by con-

cealing a statement by Duncan that he had never used cocaine with

Kimbler. Neely argues that this statement would have allowed him to

impeach Kimbler's testimony. While this may or may not be true,

Neely cannot show that Duncan's statement was material to his

defense. Neely employed a host of impeachment material during his

cross-examination of Kimbler, most of it far more damning than Dun-

can's statement. Accordingly, we conclude that assuming the Govern-

ment was obligated to disclose Duncan's statement to the defense, the

failure to do so does not give rise to a reasonable probability that, had

the statement been disclosed, the outcome of the trial would have

been different.

III.

Second, Neely maintains that his convictions were obtained in vio-

lation of his Fifth Amendment right against compelled self-

incrimination. Specifically, Neely contends that he produced two sets

of documents pursuant to immunity orders and that the Government

violated those immunity orders by: (1) using documents to prepare its

case against Neely; (2) referring to Neely as the source of documents

before the grand jury; and (3) referring to Neely as the source of doc-

uments at trial. We conclude that none of these claims has merit.

The Fifth Amendment provides in part that no person"shall be

compelled in any criminal case to be a witness against himself." U.S.

Const. amend. V. The Supreme Court has held repeatedly that the

contents of voluntarily prepared business records are not protected by

the Fifth Amendment because, while possibly incriminating, their cre-

ation was not compelled. See, e.g., United States v. Doe, 465 U.S.

605, 610 (1984) ("[T]he Fifth Amendment protects the person assert-

ing the privilege only from compelled self-incrimination. Where the

preparation of business records is voluntary, no compulsion is pres-

ent." (citation & footnote omitted)); Fisher v. United States, 425 U.S.

391, 409 (1976) ("[T]he Fifth Amendment would not be violated by

the fact alone that [an accountant's workpapers] on their face might

incriminate the [defendant], for the privilege protects a person only

against being incriminated by his own compelled testimonial commu-

nications. . . . Furthermore, . . . the preparation of all of the papers

sought in these cases was wholly voluntary . . . ." (citations omitted)).

Whether the act of producing business records has independent tes-

timonial significance and may not be compelled absent a grant of

immunity coextensive with the privilege is, however, another ques-

tion. Thus, even though the contents of business records are not pro-

tected,

"[t]he act of producing evidence in response to a subpoena nevertheless has communicative aspects of its own, wholly aside from the contents of the papers produced. Compliance with the subpoena tacitly concedes the existence of the papers demanded and their possession or control by the [defendant]. It would also indicate the [defendant's] belief that the papers are those described in the subpoena. The ele- ments of compulsion are clearly present, but the more diffi- cult issues are whether the tacit averments of the[defendant] are both `testimonial' and `incriminating' for purposes of applying the Fifth Amendment. These questions perhaps do not lend themselves to categorical answers; their resolution may instead depend on the facts and circumstances of par- ticular cases or classes thereof."

Braswell v. United States, 487 U.S. 99, 103 (1988) (quoting Fisher, 425 U.S. at 410) (citation omitted). According to the Braswell court, the custodian of corporate records does not possess a Fifth Amend- ment privilege against the production of those records, because he holds those records only as a representative of the organization. See id. at 104. However, in the case of a sole proprietorship, Braswell holds that, under Doe, the custodian of the records must "be provided the opportunity to show that his act of production would entail testi- monial self-incrimination." Id. If the custodian makes such a showing, the Government cannot compel production of the records unless it first grants the custodian immunity coextensive with the scope of the privilege. See Kastigar v. United States, 406 U.S. 441, 449 (1972). The district court's conclusion with respect to whether an individual is entitled to immunity for his act of producing business records is a finding of fact that we may overturn only if it is unsupported by the record. See Doe, 465 U.S. at 613-14.

In December 1990, the grand jury issued a subpoena addressed to

"ROBERT KEITH NEELY, ESQ., Custodian of Records for sole

practice law firm" requesting "ANY AND ALL client related records

and documents . . . relative to Michael Giacolone, Jamel Agemy,

James Regan for the period 1980 to September 1990." (J.A. at 508,

510) (Document Set One.) Neely moved to quash the subpoena, argu-

ing that the documents were protected by attorney-client privilege and

that being required to produce the records would violate his Fifth

Amendment right against compelled self-incrimination. After the dis-

trict court granted the motion to quash, Neely agreed to produce the

documents pursuant to a grant of immunity. Thereafter, at the Gov-

ernment's request, the district court entered an order granting Neely

immunity for "testimony or . . . other information which he refuses

to give or to provide on the basis of his privilege against self incrimi-

nation." (J.A. at 543-44.) Neely then produced the documents.

In May 1991, the grand jury served another subpoena, addressed

to "Keith Neely, Custodian of Records, R. Keith Neely, P.C.," seek-

ing "ANY AND ALL records, files, [etc.] . .. maintained by the

R. Keith Neely law firm" related to the purchase of the Claytor Lake

property and to Kimbler, Hurst, and Franklin. (J.A. at 1151, 1153)

(Document Set Two.) Neely moved to quash this subpoena; in

response, the Government moved for an order of act-of-production

immunity. After examining the subpoenaed documents in camera, the

district court granted in part Neely's motion to quash. The district

court held that some of the documents were subject to attorney-client

privilege and that the compulsory production of others would violate

Neely's right against compelled self-incrimination. With respect to

the rest, the district court concluded that the documents were corpo-

rate papers not protected by the Fifth Amendment. 7 Neely subse-

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7 The district court's rulings with respect to the two sets of documents

leave some question as to whether it viewed R. Keith Neely, P.C. as a

sole proprietorship or as a corporation. We need not resolve this ambigu-

ity because the contents of the subpoenaed documents were not privi-

leged under either characterization and because we conclude that,

assuming Neely's act of producing the documents was protected by a

Fifth-Amendment privilege, any reference to Neely as the source of the

documents was harmless beyond a reasonable doubt.

14

quently produced these documents. 8

Neely argues that the district court granted him use immunity for

the contents of Document Set One, and therefore claims that the Gov-

ernment violated his right against compelled self-incrimination in

showing the documents to two witnesses, Giacolone and Tangie Vest,

a former employee of Neely's, to help the Government prepare for

trial. In response, the Government argues first, that the order grants

Neely only act-of-production immunity, and second, that even if the

order did grant use immunity, the documents are corporate records

and therefore not protected by the Fifth Amendment. After a lengthy

hearing on this issue, the district court found that Neely "would enjoy

immunity as to any act of production, but not as to the contents of the

documents produced. While the order granting immunity was broad

enough to cover any activity or testimony of the defendant, the evi-

dence shows that the only testimonial act the defendant performed

was producing the records." (J.A. at 663.)

We cannot conclude that the district court's finding that Neely's

only testimonial act was the production of Document Set One is

clearly erroneous. See Doe, 465 U.S. at 613-14. The subpoena clearly

sought business records of the law firm, and Neely does not dispute

that those records were created voluntarily. Accordingly, Neely pos-

sessed no Fifth Amendment right with respect to the contents of those

documents. See id. at 610. And, given that Neely operated his law

firm as a sole practitioner, the district court's finding that Neely was

entitled to immunity for his act of producing the documents is not

clearly erroneous. Thus, although the Government was barred from

using Neely's act of producing Document Set One against him, it was

free to use the contents of Document Set One to prepare its case

against Neely. 9

_________________________________________________________________

8 We can find no support in the record for Neely's assertion that the

district court granted the Government's motion for act-of-production

immunity. The document to which Neely points, (see J.A. at 562-63), is

simply a draft order submitted by the Government with its motion. The

draft order was never signed by the district court.

9 Neely argues that, having granted him use immunity, the Government

was required to show that none of the evidence offered against Neely at

The district court's finding that Neely was entitled to immunity for

his act of producing Document Set One necessarily means that Agent

Higginbotham acted improperly when he referred to Neely as the

source of Document Set One before the grand jury that received those

documents. Indeed, the Government does not dispute that Agent Hig-

ginbotham's comments violated Neely's Fifth Amendment right.

Rather, the Government contends that the violation was harmless

beyond a reasonable doubt and reversal of Neely's convictions there-

fore is not required. See United States v. Harris, 973 F.2d 333, 338

(4th Cir. 1992) (noting that use of compelled testimony does not

require reversal if error is harmless beyond a reasonable doubt). In

advancing this contention, the Government rightly points out that, in

addition to the fact that the Government reminded the grand jury that

it was not to consider that Neely had produced the documents, the

grand jury that indicted Neely was not the same grand jury that

received the records, and no improper references were made to Neely

as the source of Document Set One before the grand jury that actually

indicted him. Under these circumstances, we conclude that neither

Neely's indictment nor his trial suffered even the slightest taint from

the improper references and that the error was harmless beyond a rea-

sonable doubt.

Neely also contends that reversal of his convictions is required

because IRS Agent Suzanne Hines, who testified at trial regarding

various financial records including several checks that had been pro-

duced pursuant to one of the grand jury subpoenas, referred to "the

defense" as the source of the checks. (J.A. at 871WW.) According to

Neely, Hines's statement requires reversal of his convictions because

it referred to Neely's testimonial act of producing the documents,

thereby violating his right against compelled self-incrimination. The

Government concedes that Hines's statement constituted error but

maintains that the district court correctly determined that this error

was harmless beyond a reasonable doubt.

_________________________________________________________________

trial was derived from the contents of Document Set One. See Kastigar,

406 U.S. at 460. Because the documents were not privileged, however,

there was no prohibition against the Government using them to prepare

its case against Neely. Neely's claim that the Government failed to meet

its burden under Kastigar is therefore misplaced.

In concluding that Hines's reference to Neely as the source of doc-

uments was harmless beyond a reasonable doubt, the district court

employed the test of Williams v. Zahradnick, 632 F.2d 353, 361-62

(4th Cir. 1980). Under Williams, the determination of whether an

error is harmless beyond a reasonable doubt depends on five factors:

(1) the use to which the Government put the improper reference; (2)

"[w]ho elected to pursue the line of questioning"; (3) "[t]he quantum

of other evidence indicative of guilt"; (4) "[t]he intensity and fre-

quency of the reference"; and (5) "[t]he availability to the trial judge

of an opportunity to grant a motion for mistrial or to give curative

instructions." Id. The district court concluded that none of these fac-

tors weighed in favor of reversal, noting that the reference was brief,

equivocal, and inadvertent; that the evidence of Neely's guilt was

substantial; and that the court had considered and rejected the options

of a mistrial or a curative instruction. 10 The district court was in the

best position to observe the impact of Agent Hines's remark in the

context of the trial as a whole. Hence, we are reluctant to disturb the

district court's carefully considered ruling that the error was harmless

beyond a reasonable doubt. Moreover, our review of the record leaves

us with no doubt as to the fleeting nature of the reference and its mini-

mal significance when considered in light of all of the evidence pres-

ented during the lengthy trial. We therefore agree with the district

court that this error does not warrant reversal because it was harmless

beyond a reasonable doubt.

IV.

Next, Neely mounts a Sixth Amendment challenge to his convic-

tions. Specifically, he posits that he was deprived of his Sixth Amend-

ment right to counsel because the Government knowingly allowed his

former attorney to represent one of the Government's witnesses on

charges unrelated to the investigation of Neely. According to Neely,

the Government failed to disclose to the district court a known con-

flict of interest, thereby resulting in Neely's being represented by

counsel with an actual conflict of interest. Neely asserts that this vio-

_________________________________________________________________

10 The district court stated that it elected not to give a curative instruc-

tion because it feared that the cure would be worse than the disease, i.e.,

that the curative instruction would draw more attention to the error than

it warranted.

lation of his Sixth Amendment right to counsel entitles him to a new

The district court held a lengthy hearing on Neely's Sixth Amend-

ment claim, at which the following facts were adduced. The Govern-

ment's investigation of Neely, led by FBI Agent Gerald Fayed and

IRS Agent Hines, began sometime in the late 1980s. In 1990, Neely

pleaded guilty to misdemeanor cocaine possession. Neely was repre-

sented in the case by his friend Turk. Neely was placed on probation

after his guilty plea; at this point Turk believed that his representation

of Neely had ended.

In March 1992, Neely contacted Turk and requested that Turk rep-

resent Hurst, who had been charged with money laundering and

released on bond. Turk undertook the representation only after being

assured by both Neely and Hurst that no conflict of interest existed.

At approximately the same time, Turk made several inquiries to the

court and to the probation office regarding the possibility of an early

release from probation for Neely. Turk avowed that he made the

inquiries as a favor to Neely, not as his counsel, emphasizing to the

district court that he informed Neely that he was not representing

Neely at that time. Turk's last activity regarding Neely's probation

status occurred on April 15, 1992.

Shortly after he agreed to represent Hurst, the Government

informed Turk of its belief that Hurst, Neely, and Kimbler had partici-

pated jointly in drug-related activities and offered the possibility of a

reduced sentence for Hurst if he agreed to testify against Neely. Addi-

tionally, Turk reviewed discovery material in the Government's pos-

session and found an affidavit by Kimbler indicating that Hurst and

Neely might be linked to drug trafficking. In response to Turk's

inquiry, Hurst stated that he did not want to testify against Neely, but

did not admit or deny the truth of the Government's allegations

regarding his association with Neely. According to Turk, Neely

repeatedly contacted him regarding the Hurst case, making inquiries

and suggesting strategies in a manner that made Turk suspect that

"Neely was trying to manipulate Hurst's defense in order to protect

himself." (J.A. at 1358.)

On May 12, 1992, the Government moved to revoke Hurst's bond

on the basis of a urinalysis that tested positive for cocaine use. Hurst

informed Turk that Neely gave him the cocaine that had resulted in

the positive urinalysis and told Turk that he now wished to testify

against Neely. At that point, Turk informed Hurst that he could no

longer serve as his attorney and advised him to seek new counsel.

Before officially withdrawing as counsel, however, Turk attended a

meeting between Hurst and the Government to negotiate a plea agree-

ment. After the meeting, Hurst met with Government investigators

several more times and met with Neely while wearing a recording

device. Turk stated that he had no specific knowledge of these activi-

ties and that he did not provide Hurst with any legal advice regarding

them. Turk was present at Hurst's plea hearing because Hurst's sub-

stitute counsel was unavailable. At that time, Turk informed the court

of the conflict and formally withdrew as counsel.

Prior to trial, Neely moved to suppress Hurst's testimony on the

basis that Turk's simultaneous representation of Hurst (on money

laundering charges unrelated to Neely) and Neely (on early release

from probation) violated Neely's right to counsel in this case. The dis-

trict court held a lengthy hearing at which Turk and others testified.

Ruling from the bench, the district court concluded that, regardless of

Turk's view that he was not "representing" Neely with respect to

Neely's probation status, Turk remained Neely's counsel throughout

Turk's representation of Hurst. The court also opined, however, that

Neely's Sixth Amendment right with respect to the instant charges

was not implicated by the dual representation because Neely had not

yet been indicted. Additionally, the district court held that any preju-

dice to Neely from the dual representation affected only Neely's pos-

sible early release from probation, not the pending charges.

That a defendant's Sixth Amendment right to counsel includes the

right to counsel free from serious conflicts of interest is beyond ques-

tion. See Hoffman, 903 F.2d at 285. A defendant's right to counsel has

been violated when an "actual conflict of interest adversely affect[s]

his lawyer's performance." Id. at 286 (internal quotation marks omit-

ted). Such a conflict exists when an attorney simultaneously repre-

sents two individuals whose interests are adverse. See id. at 285.

Neely's Sixth Amendment claim is patently without merit. Assum-

ing that Turk labored under an actual conflict of interest in his simul-

taneous representation of Hurst and Neely, this conflict related only

to Turk's representation of Neely on the cocaine-possession matter.

Because Turk did not represent Neely on the instant charges --

indeed, the conflict was resolved before Neely was even indicted on

these charges -- Neely was not represented by counsel laboring under

an actual conflict of interest, and could not have suffered a depriva-

tion of his right to counsel.

V.

Neely further contends that the Government abused the grand jury

process by commencing a grand jury investigation of Franklin before

Neely's trial took place. According to Neely, the investigation of

Franklin was a mere pretext for the Government's real purpose,

namely acquiring more evidence against Neely. The Government

counters that its investigation of Franklin was legitimate. We find

Neely's claim to be without merit.

A court should not intervene in the grand jury process absent a

compelling reason. See United States v. Dionisio , 410 U.S. 1, 16-18

(1973). A presumption of regularity attaches to grand jury proceed-

ings, and Neely has the burden of showing that this presumption is

unwarranted. See United States v. Moss, 756 F.2d 329, 332 (4th Cir.

1985). While the Government may not utilize a grand jury "solely or

even primarily for the purpose of gathering evidence in pending liti-

gation," id., the existence of a pending indictment does not preclude

the Government from using a grand jury to make a good-faith inquiry

into charges not included in the indictment, id. Provided investigation

of the defendant is not the Government's "sole or dominant purpose"

in convening the grand jury, no abuse of the grand jury process has

occurred. Id. The advantage of this rule is that it allows grand juries

to conduct continuing investigations without waiting to indict persons

against whom sufficient evidence to indict has been obtained:

Lacking clairvoyance, grand juries must be allowed to investigate freely individuals suspected of involvement in crimes for which indictments have already been issued. When applied correctly, the sole or dominant purpose test plainly permits grand juries to investigate additional individ- uals who become suspects only after an indictment has been returned, while precluding improper use of the grand jury for discovery.

Id. The district court's determination regarding the Government's sole or dominant purpose in conducting a grand jury investigation is a fac- tual finding, which we review only for clear error. Id.

Franklin was named, but not indicted, in the indictment charging

Neely. After the indictment was returned, but before Neely's trial, a

grand jury was convened to investigate Franklin on charges unrelated

to the Neely indictment. Immediately upon learning of the investiga-

tion, Neely filed an emergency motion to enjoin the grand jury pro-

ceedings. The district court held an emergency hearing on Neely's

motion, during which Neely asserted his belief that the investigation

of Franklin was being used as a discovery device in the Government's

case against Neely. In response, the Government proffered, under

seal, its reasons for investigating Franklin. Agent Fayed testified that

the grand jury's investigation of Franklin was related to Franklin's

suspected distribution of marijuana and cocaine and that the Govern-

ment had proceeded with its investigation of Franklin because its key

witness, Kimbler, was suffering from terminal cancer, making it nec-

essary to secure his testimony for trial in the form of a videotaped

deposition. The Government, therefore, had to determine whether

there was sufficient evidence against Franklin to indict him so that he

could be present during the deposition.

Based on this information, the district court concluded that the

Government's investigation of Franklin was conducted in good faith,

and that the investigation was not being carried out for the sole or

dominant purpose of acquiring evidence against Neely. We cannot

say that this finding was clearly erroneous, and accordingly, decline

to reverse Neely's convictions on this basis.

VI.

Neely next maintains that the district court committed reversible

error by allowing the Government to designate two case agents,

Agents Fayed and Hines, both of whom were exempted from the

21

district court's order sequestering witnesses. See Fed. R. Evid. 615. 11

While we agree with Neely that an error was committed, we find the

error harmless.

Rule 615 provides for the exclusion of witnesses at the request of

a party. Exclusion is a matter of right; once a request is made, the

court "shall" sequester the witnesses. Id. ; see United States v.

Farnham, 791 F.2d 331, 334-35 (4th Cir. 1986). Rule 615 is designed

to aid the truth-seeking process by denying the opportunity for wit-

nesses to collude or for one witness to tailor his testimony to the testi-

mony of another. See id. at 334-35. Every witness need not be

excluded, however. Rule 615 exempts from sequestration: (1) a party

who is a natural person; (2) a designated representative of a party that

is not a natural person; and (3) a person whose presence is essential

to the presentation of the case. Fed. R. Evid. 615. That the Govern-

ment's investigating agent may be exempted from sequestration pur-

suant to Rule 615(2) is beyond dispute, see United States v. Parodi,

703 F.2d 768, 773 (4th Cir. 1983); that the Government may desig-

nate only one such agent is equally clear. Farnham, 791 F.2d at 335.

The Government erroneously relies on United States v. Kosko, 870

F.2d 162, 164 (4th Cir.), cert. denied, 491 U.S. 909 (1989), for the

proposition that "a district court may permit two case agents to remain

in the courtroom if their testimony does not overlap and undermine

the integrity of the fact-finding process." (Appellee's Brief at 35.) In

Kosko, we affirmed the district court's ruling allowing a DEA agent

and an IRS agent, both of whom had participated in the investigation

of the defendant, to remain in the courtroom during trial because the

latter agent was present in the courtroom as an expert witness whose

presence was essential to the presentation of the Government's case.

_________________________________________________________________

11 Rule 615 provides:

At the request of a party the court shall order witnesses excluded so that they cannot hear the testimony of other wit- nesses, and it may make the order of its own motion. This rule does not authorize exclusion of (1) a party who is a natural per- son, or (2) an officer or employee of a party which is not a natu- ral person designated as its representative by its attorney, or (3) a person whose presence is shown by a party to be essential to the presentation of the party's cause.

Kosko, 870 F.2d at 164; see Fed. R. Evid. 615(3). Indeed, Kosko explicitly reaffirmed the holding of Farnham that the Government may designate only one case agent as its representative. Kosko, 870 F.2d at 164. Regardless of the wisdom of the Government's position that a district court may designate more than one case agent when each agent represents a different governmental agency and their trial testimony will not overlap, we are bound by Farnham and Kosko to reject it.

In short, the district court erred in permitting the Government to

designate two case agents, both of whom were exempted from the

sequestration order and both of whom testified at Neely's trial. The

question remains, however, whether this error requires us to reverse

some or all of Neely's convictions. See Farnham , 791 F.2d at 335

(holding that a violation of Rule 615 does not require vacatur of con-

victions if the error was harmless). Although both agents testified dur-

ing the trial, their testimony concerned entirely different matters:

Agent Fayed's testimony concerned Neely's telephone records, while

Agent Hines testified regarding Neely's financial records. Cf. Kosko,

870 F.2d at 164 (concluding that because "the testimony of the two

agents did not overlap as to any matter on which they had personal

knowledge, . . . their mutual presence during trial could not have

undermined the integrity of the fact-finding process"); Farnham, 791

F.2d at 334 (finding violation of Rule 615 not harmless when two

agents testified regarding their personal knowledge of the same

events). We therefore conclude that the error was harmless.

VII.

Finally, Neely contends that his convictions for conspiracy to pos-

sess cocaine for personal use (Count Two) and aiding and abetting the

distribution of cocaine (Count Three) are mutually exclusive, thereby

requiring reversal of Count Three, the more serious crime. Specifi-

cally, Neely claims that the affirmative finding of intent required for

a conviction on the possession count -- i.e., the intent to possess

cocaine -- necessarily precludes an affirmative finding of the intent

required for conviction on the aiding and abetting count -- i.e., the

intent to distribute cocaine -- because one cannot intend simulta-

neously to possess something and to distribute it.

We are not persuaded by this argument. There was ample evidence

from which the jury could conclude that Neely conspired with other

individuals to obtain cocaine for his personal use while simulta-

neously aiding and abetting Kimbler in his distribution activities. At

most, the jury's verdicts on these counts are inconsistent, but this does

not entitle Neely to an acquittal on Count Three. See United States v.

Powell, 469 U.S. 57, 63 (1984); see also United States v. Arrington,

719 F.2d 701, 705 (4th Cir. 1983) (concluding that acquittal on con-

spiracy charge is not a valid basis for reversal of conviction on charge

of aiding and abetting), cert. denied, 465 U.S. 1028 (1984).

VIII.

We have reviewed carefully all of Neely's assignments of error and

conclude that none of them warrants reversal of his convictions.

Accordingly, Neely's convictions are affirmed.

AFFIRMED