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UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF GEORGIAATLANTA DIVISIONUNITED STATES OF AMERICA ::CRIMINAL INDICTMENTv. ::NO. 1:06-CR-337-CCCHRISTOPHER STOUFFLET, et al.::Defendants. :
GOVERNMENT’S MOTION FOR DISCLOSURE OFRELIANCE ON ADVICE OF COUNSEL
COMES NOW the United States of America, by its counsel, DavidE. Nahmias, United States Attorney for the Northern District ofGeorgia, and Randy S. Chartash, and Lawrence R. Sommerfeld,Assistant United States Attorneys, and files this Motion ForDisclosure of Advice of Counsel Defense.Defendant Christopher Stoufflet and six other individuals,including five doctors, were charged in a fifty-one countIndictment for their involvement in an Internet-based business thatdistributed and dispensed controlled substances and otherprescription drugs to thousands of customers without validprescriptions. Specifically, Count One of the Indictment chargesdefendant Stoufflet and others with conspiracy to violate thecontrolled substance act; Counts Two through Four charge theunlawful distribution and dispensing of controlled substances;Count Five charges the defendants Christopher Stoufflet and TroySobert with conspiracy to money launder; Counts Six through Forty-Eight charge defendants Christopher Stoufflet and Troy Sobert with
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2promotional and transactional money laundering; and Counts Forty-nine through Fifty-one charge Christopher Stoufflet and Troy Sobertwith misbranding drugs held for sale after shipment into interstatecommerce.This case centers around an Internet-based business,escriptsmd.com, that defendant Christopher Stoufflet, together withothers, established and operated. In 2001, Stoufflet sought tocapitalize on the Internet boom by setting up an on-line businessto sell pharmaceutical products, including controlled substances.Stoufflet's business enlisted physicians who would approve thedispensing of drugs to customers who requested medication on-line.Stoufflet would then cause the dispensing of the drugs, based onthe physician's “prescriptions”, to customers throughout the UnitedStates.Throughout the investigation of this matter and continuing upto this date, the United States has sought to elicit whetherdefendant Stoufflet would rely on advice of counsel at trial. Invarious conversations with counsel for lead defendant ChristopherStoufflet, counsel asserted that defendant Stoufflet consultedvarious attorneys regarding the legality of on-line dispensing ofcontrolled substances and other prescription drugs. Currentcounsel for defendant Stoufflet advised the government that he mayassert advice of counsel as a defense. The government urgedcounsel for defendant Stoufflet to formally declare whether or not
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Raising an advice of counsel defense waives theattorney-client privilege. See, e.g., United States v.Bilzerian, 926 F.2d 1285, 1292 (2d Cir. 1991)(cannot useattorney-client privilege as both a shield and a sword); UnitedStates v. Burger, 773 F. Supp. 1419, 1429 (D. Kan. 1991)(waiverin context of pretrial discovery); McNeil-PPC, Inc. v. Procter &Gamble Co., 138 F.R.D. 136, 137 (D.Colo. 1991); ColecoIndustries, Inc. v. Universal City Studios, Inc., 110 F.R.D. 688,690-91 (S.D.N.Y. 1986); United States v. Mierzwicki, 500 F. Supp.1331, 1334 (D. Md. 1980) (fairness demands treating the defenseas a waiver of the attorney-client privilege). In asserting anadvice of counsel defense, a defendant, in essence, representsthat he fully disclosed all relevant facts to an independentattorney, the attorney offered a legal opinion or rendered legaladvice on the legality of a proposed transaction, and thedefendant relied in good faith on this opinion or advice indetermining a course of action. See, e.g., C.E. Carlson, Inc. v.SEC, 859 F.2d 1429, 1436 (10th Cir. 1988); United States v. Carr,740 F.2d 339, 347 (5th Cir. 1984). This assertion is enough toconstitute a waiver of any associated attorney-client privilege,because the communications with the attorneys would becomematerial to determining the defendant’s knowledge and intent.See United States v. Plache, 913 F.2d 1375, 1380 (9th Cir. 1991);United States v. White, 887 F.2d 267, 270 (D.C. Cir. 1989); In reVon Bulow, 828 F.2d 94, 101 (2d Cir. 1987); United States v.Aronoff, 466 F. Supp. 855, 862 (S.D.N.Y. 1979).3it would raise the defense so that the issue could be fullyassessed by the government to determine whether it provides a validlegal defense to the charges, and so the United States couldadequately prepare for trial. Defendant Stoufflet has not yetnotified the government of his intention of whether he was going torely on advice of counsel as a defense.If an advice-of-counsel defense is first asserted at trial,thus waiving defendant’s attorney-client privilege,
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the governmentwill then be in the difficult and unfair position of being forcedto respond in the middle of the trial to a large quantity of new
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