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. UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA
2
3 CASE NO. 97-14687-BKC-AJC
4
IN RE:
5 ML
S TE PHAN 'JAY LAWRENCE,
6
, i
•
CT ; . 77---31
Debtor. i ii i =
7 1
, SEP ? 6 7005 1 =

8
9 NOVEMBER 16, 2000 —____---JI
----
:

HEARING RE: IN CAMERA INSPECTION

12
13
14
15 The above-entitled cause came on for hearing
16 before the HONORABLE A. JAY CRISTOL, at the Claude
17 Pepper Federal Building, 14th Floor, Miami, Dade
18 County, Florida, at 10:30 a.m. on Thursday,
19 November 16, 2000, and the following proceedings were
20 had:
21
22
23
24
25

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APPEARANCES:

BERGER DAVIS & SINGERMAN

by: JAMES FIERBERG, ESQUIRE
PAUL AVRON, ESQUIRE
on behalf of the Trustee
U.S. ATTORNEY'S OFFICE
by: GRISEL ALONSO, ATTORNEY-AT-LAW
on behalf of the U.S. Attorney's Office
FEDERAL BUREAU OF PRISONS
by: RICHARD DEAGUIAR, ESQUIRE
on behalf of the Federal Bureau of Prisons
OFFICE OF THE UNITED STATES TRUSTEE
by: ROBERT ANGUEIRA, ASSISTANT U.S. TRUSTEE
on behalf of the Office of the United States
Trustee

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THE COURT: As I understand it, this matter

is a request for an in camera inspection.
MR. FIERBERG: Judge, good morning. James
Fierberg on behalf of the Trustee. With me is my
colleague, Paul Avron. It's not an inspection, Judge,
it's a request for authority to take discovery from the
U.S. Bureau of Prisons under seal.
THE COURT: Okay.
MR. FIERBERG: And this is an in camera
hearing because of the sensitivity of the matters
presented.
THE COURT: Is there anyone here for the
Bureau of Prisons?
MS. ALONSO: Good morning, Your Honor.
Grisel Alonso, Assistant United States Attorney. With
me here today is Richard Deaguiar, a senior attorney
with the Federal Bureau of Prisons. Mr. Deaguiar will
be arguing the Government's position in this matter.
We're here as an interested party.
THE COURT: All right. Well, basically I
have read the motions and I thought that under the
circumstances it was proper to do this in camera. The
matter of concern is whether or not the Bureau of
Prisons has any objection and whether or not there's
some reason why this should not be allowed.

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As you know, the Trustee is seeking various

telephone records, specifically recorded telephone
conversations made by the Debtor.
Excuse me, Your Honor, I have a bit of a
cold.
THE COURT: Take your time. Do you need some
water?
MR. DEAGUIAR: I'm fine. Thank you.
As well as some visiting records that are
maintained by the Bureau. The Government concedes that
the Trustee, the Trustee's cause, is an honorable one.
However, the Government would respectfully submit that
it objects to the relief sought because, first,
believes that the Trustee is on nothing more than a
fishing expedition which will, in fact, pose a
significant and unreasonable burden on the Federal
Detention Center, which will significantly impede the
Institution's ability to maintain security.
Secondly, the Government objects because the
relief sought would be in violation of Federal
Regulations found at Title 28 Sections 16.21,
exequatur, and I have copies of those regulations if
Your Honor would like.
THE COURT: That's 28 CFR?
MR. DEAGU1AR: Yes, sir.

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THE COURT: All right. I would like them if

you have them. Do you have them for opposing counsel?
MR. DEAGUIAR: Yes, I do.
THE COURT: Thank you, sir.
MR. DEAGUIAR: Thirdly, Your Honor, the
Government feels that compliance with the Trustee's
request would violate both the Privacy Act found at 18
USC 552 (a), I have copies of that statute as well if
you would like, Title 5, and also Title 3 of the
Omnibus Crime Control and Safe Streets Act of 1968
found at 18 USC Sections 2510 through 2522, and I have
copies of pertinent sections with me as well.
THE COURT: Very well. If you'd distribute
them to the Court and opposing counsel as well.
MR. DEAGUIAR: Proceeding to the regulations,
Your Honor, the United States argues that the Trustees
presently seek disclosure of law enforcement records in
the Federal Detention Center's possession, and
disclosure of such records is governed by the Federal
Regulations found at 28 CFR Sections 1621, exequatur.
THE COURT: All right. Point out the
regulation that you're referring to. I have it in my
hand.
MR. DEAGUIAR: Okay. Specifically Section
1621 encompasses release of records in response to a

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demand whether from a party or from a court.

THE COURT: All right. So we're talking
about 1621 (a) (2), is that it?
MR. DEAGUAIR: Yes, Your Honor. And this is
specifically in cases where the United States is not a
party. And --
THE COURT: Just a second. Let's see what it
says. Okay. It starts out by saying procedures to be
followed with respect to production or disclosure.
MR. DEAGUIAR: That's correct, Your Honor.
THE COURT: Okay. And then in (a) (2) it says
in Federal and State proceedings which the United
States is not a party. We have no dispute the United
States --- well, I don't know. Is the United States a
party?
MR. FIERBERG: I just confirmed with
Mr. Angueira about that because Mr. Goldberg is the
party here.
THE COURT: Mr. Goldberg is at least an agent
of the Department of Justice. What do you think,
Mr. Angueira, is he or isn't he?
MR. ANGUEIRA: Judge, I haven't read the
regulations that have been cited to you. We were not
planning to take a position on this matter. What we
were -- the reason I'm here is when I got the motion I

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saw that the U.S. Attorney's Office had not been

served, the Bureau of Prisons had not been served, and
I wanted to make sure, or the U.S. Trustee wanted to
make sure, that they were made aware and if they had
any comments that they would make them to you. I would
be more than glad to take those regulations, take a
look at them.
THE COURT: Well, that's what we're doing.
We're not doing anything hastily here.
MR. ANGUEIRA: Right. And take it to Atlanta
and --
THE COURT: Quickly, but not hastily.
For example, it says for the purposes of --
this subpart determined employee of the Department --
of the Department includes all officers and employees
of the United States appointed by -- subject to the
supervision, jurisdiction or control of the Attorney
General of the United States.
Well, certainly the Attorney General of the
United States supervises your office and your office
supervises the Trustee. So it looks like they may -- I
mean, may fit in there. I mean, I don't know. This is
the first time I've seen these regulations.
MR. FIERBERG: Your Honor, if you read on it
does specifically state U.S. Trustees.

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THE COURT: Oh, okay. I hav e n't read that

far. Oh, yes, U.S. Trustees and members of the staffs
of those officials. Okay.
So the first thing that we have to decide is,
are we dealing with a request from a situation where
the United States is not a party or is the United
States a party by virtue of the status that the party
that's making the request is a panel trustee.
MS. ALONSO: Your Honor, if I could address
that? I believe the statute is clear. It would
indicate where the United States is a party, and the
issue here is the United States is not a defendant in
this case. We're not in a contested matter where the
United States is the party.
THE COURT: Well, if the United States is
Mr. -- who's the Trustee in this case?
MR. FIERBERG: Alan Goldberg, Judge.
THE COURT: If Mr. Goldberg is the Trustee
and he is the United States then I would certainly
think he's a party. He's the one that has brought
these proceedings and has caused this person to be
incarcerated because of his failure to comply with the
turn over of the property and that the United States is
seeking the property.
MS. ALONSO: Well, then he would be seeking

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the discovery from himself, I mean, if he is the party:

THE COURT: Not for himself. You may not be
aware of this, but there are several different agencies
in the United States. He happens to be also in the
Department of Justice where you're located, but not
necessarily in the same building or same office. And,
of course, the Bureau of Prisons is the United States.
So the question is -- well, as I say -- the
question is, should we do this? And I'm trying to go
through these regulations. I mean, we want to be on
the same wavelength.
Clearly if the United States is not a party
we've got one subsection and if the United States is a
party we've got another subsection, and then I don't
know where we go from there. I'm only on the first
page with you. So, I mean, let's try and go through it
together.
We do need to determine, I presume, whether
we're on subsection 1 or 2, is the United States a
party or is the United States not a party? 1 suggest
that the United States may well be a party by virtue of
the language of subsection 2, but again, that is not a
ruling, that's a reading that I made on the basis of 60
or 120 seconds of observation.
Let's see, it says it's intended to provide

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guidance for the internal operations of the Department

of Justice and is not intended to or not to be relied
on to create any right or benefit, substantively or
procedurely, enforceable in law by a party against the
United States.
Well, obviously if the Bureau of Prisons is
the United States we're seeking to enforce, I guess,
something against them. On the other hand, if the
panel trustee is the United States then is the United
States against the United States? I don't know. It's
getting a little mixed up, but let's go on.
MR. DEAGUIAR: If it appears --
THE COURT: Pardon?
MR. DEAGUIAR: If it appears it is getting a
little convoluted I can, if the Court wishes, simply
refer to the regulations governing disclosure of
authority in Federal and State proceedings in which the
United States is in fact a party.
THE COURT: Well, I mean, as I say, we need
to look at both unless we can all agree as to whether
or not the United States is a party.
MR. DEAGUIAR: Both sections refer me to the
same subpart --
THE COURT: Okay. And where is it?
MR. DEAGUIAR: -- which is going to prohibit

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disclosure in this case.

THE COURT: And where is that?
MR. DEAGUIAR: Specifically, the sections
provide that a party cannot disclose -- the United
States cannot disclose records without proper
authorization from a departmental official and the
departmental official is to consider several factors.
THE COURT: Where is that in the regulations,
Counsel?
MR. DEAGUIAR: The factors are at Section
1626, Your Honor.
THE COURT: 1626?
MR. DEAGUIAR: Yes.
THE COURT: Well, let's see, 1623 says
general disclosure authority when the United States is
a party, and 1622 has general prohibition of production
or disclosure in which the United States is not a
party.
So are we conceding you under 1623 or are we
arguing under 1622?
MR. DEAGUIAR: Not at all, Your Honor. I'm
saying merely that --
THE COURT: Okay.
MR. DEAGUIAR: -- since both of them refer us
to the same factors for consideration perhaps the Court

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should look at those factors --

THE COURT: All right.
MR. DEAGUIAR: -- to determine whether this
disclosure is appropriate.
THE COURT: And there you say it's 1626, and
1626 says what?
MR. DEAGUIAR: 1626 basically sets forth
factors to be weighed by the authorizing department
official, which in this case is going to be an
individual in the Bureau of Prisons southeast regional
office in Atlanta, Georgia. Okay?
And the factors to be weighed include- whether
disclosure is appropriate under the rules of procedure
governing the case, 1626 (a) (1), whether disclosure
would violate a statute, that's at 1626 (b) (1).
In this case, the United 4tates argues that disclosure
would violate both the Privacy Act and Title 3.
Furthermore, --
THE COURT: Well, let's -- run that by me a
little bit. The Privacy Act says certain things, but
when someone has -- is in a situation of this
individual, are they covered by the Privacy Act when
they have consented to the recording of their
conversations?
MR. DEAGUIAR: The Government argues that

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they have consented to recording of the conversations

for purposes of the Bureau of Prisons law enforcement
objectives.
Additionally, the Government's position is

that the individuals with whom the Debtor may be

speaking themselves would have a privacy interest in
these records, and the Privacy Act does in fact state,
as this Court knows, that no agency shall disclose any
record which is contained in a system of records by any
means of communication to any person or to another
agency except pursuant to a written request or with the
prior written consent of the individual to whom the
record pertains. That's found at 5 USC Section 552 (a)
(b).
THE COURT: Go ahead.
MR. DEAGUIAR: Now, the Privacy Act itself
does provide remedies when an agency would
inappropriately withhold records and it does within the
language give this Court jurisdiction to then take
action.
Arguably, however, the Government feels that
the Trustee has not even indicated that this Court has
jurisdiction to enter an order pursuant to the Privacy
Act.
The Government will concede that records can

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be disclosed pursuant to an order of a court of

competent jurisdiction. The caveat is we would place
the burden upon the Trustee to demonstrates that this
Court is of competent jurisdiction, without any
disrespect to Your Honor.
THE COURT: Well, we'll certainly hear
argument on that, and I wonder what conclusion we'll
come to on that point?
Okay.
MR. DEAGUIAR: Now, the Government argues
that disclosure of these records would also be a
violation of the provisions of Title 3 and --
THE COURT: Pardon me. Let me just check
this 5 (b) here. It says here, Assistant Attorneys'
General, U.S. -- United States Attorney, the Director
of the -- D.O.U.S.T. and the United States Trustee --
United States Trustee and their designees are
authorized to issue instructions to attorneys without
supervising practices consist with this subpart in
order to help foster assistant application of the
court-ordered standards of the requirements of this
subparagraph.
Okay. So we keep getting back to the
Executive Office of the United States Trustee and the
U.S. Trustees, et cetera, is somehow being involved

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here. I'm not making this as a determination yet, but

certainly it points to the United States being a party
as opposed to not being a party.
So what you're telling me at this point is
that the matter should go from here to an official in
the Bureau of Prisons to consider the request, is that
what your argument is?
MR. DEAGUIAR: Yes, Your Honor.
THE COURT: All right. I think that's
reasonable. And where and who? I mean, how far away?
How much time are we talking about? Days? Weeks?
Months?
MR. DEAGUIAR: Pursuant to the regs what the
Bureau of Prisons would first request is that the
Trustee provide in detail a summary of exactly what the
information they are seeking is in the pleadings,
although the Trustee does in fact reference somewhat
what they're seeking it seems that their request is
overly broad and burdensome, and in fact, may be more
of a hunch than anything else.
So we would request if we're going to proceed
and consider this matter that they provide us either
with specific phone numbers that they feel were called

THE COURT: Oh, come on. Now you're talking

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nonsense. I mean, if they knew the numbers they

wouldn't have to ask you for them. I mean,
MR. DEAGTHAR: They would be able to give
certain names.
THE COURT: The question is, is this guy in
the can in touch with somebody that's holding the ten
million and if he is, that's what they're looking for.
If they already knew that they wouldn't have to be
bothering you.
The question is, do they have a right to get
a list of numbers that he's calling to see if they can
trace the money. That's what this is about.
So whether they may or may not do that, that's what
we're here to talk about, but to suggest that they
can't get the numbers unless they've got the numbers,
is a cercuitous argument that won't fly as far as I'm
concerned.
MR. DEAGUIAR: Okay. The Government also
feels that it does not have the authority to disclose
these records outside the Bureau of Prisons because the
Bureau of Prisons has authority pursuant to an
exception to Title 3, which is basically the statute
governing wire taps, and Title 3 excludes the
interception of phone conversations through electronic
means when said conversations are intercepted by law

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enforcement officials in the ordinary course of their

duties.
Under this very narrow accension the Bureau
of Prisons records all inmate telephone conversations
and the Bureau does not feel that its authorized to
release these to a third party even if this Court
wishes to consider that it's the Trustee's Office.
THE COURT: Okay.
MR. DEAGUIAR: Finally, what I'd like to
point out is the burden that could be placed upon the
Bureau of Prisons and the Federal Detention Center, in
particular, if the Bureau is required to engage in
discovery as is sought in the Trustee's request for
relief.
To that end, we understand that the Trustees
are seeking visiting records and we would object on
grounds that there could be many visiting records.
HoweVer, the Government will concede that in the
Debtor's case records indicate only one visitor.
So on the grounds of visiting records, we
will not be arguing undue burden. We would keep our
Privacy Act objections for the Court to consider.
As to the telephone tapes themselves,
however, I would like to describe to the Court how the
entire process works so that the Court can consider the

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dynamics involved and the extent of the burden. In

doing so, I would request the Court to allow the
Federal Detention Center to present those facts in
camera ex-parte due to the sensitive nature.
THE COURT: Okay. So we're going from in
camera to in camera ex-parte and maybe after that we
can go to some sort of a star chamber in camera until
we finally get down to where I go out in the field
somewhere and meditate, but I don't know where were
going here but that may not be an unreasonable request.
MR. FIERBERG: Your Honor.
THE COURT: Yes.
MR. FIERBERG: Mr. Avon and I --
THE COURT: Oh, just a moment. I'm sorry,
Miss Yanks, but the courtroom is closed.
MS. YANKS: Oh, I'm sorry.
THE COURT: This is an in camera hearing.
When it's finished we'll be happy to see you and we'll
let you know as soon as it's over.
MS. YANKS: I'm sorry.
MR. ANGUEIRA: Excuse me, Judge. Her hearing
is at two, I believe.
THE COURT: No, no. She's here for a
ten o'clock. It was scheduled at two, but she's here
now for a ten.

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So it's amazing what computers can do.

MR. DEAGUIAR: Your Honor, if I can quickly
touch upon the fees?
THE COURT: All right. Let me just glance
through here again. However, the international calls
-- well, there's a good number of them, yeah. On some
pages there are only a few. It appears on this page
only one international call and the international
numbers seem to be limited to -- looks like at least
three of them. So, by initially identifying where the
calls are going it may knock out the need for a whole
bunch of them, but I thank you for the look at this
telephone account statement. I wonder how we did this
before computers? Just incredible.
MR. DEAGUIAR: We were not as efficient, Your
Honor.
THE COURT: I'll return this to you, sir.
Okay. So what further do we have to add?
MR. DEAGUIAR: It seems at this juncture that
the Court is not ready to decide whether or --
THE COURT: Well, I think what you have
suggested is that the next step in this procedure, if
it's to continue forward, is that this matter needs to
be forwarded for a determination by an official of the
Bureau of Prisons as to whether or not they want to

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honor the request under the procedures that

Mr. Fierberg has described.
I don't know, do we need -- you raised a
question of determination of whether or not this Court
was a court of competent jurisdiction to hear this.
Perhaps we ought to argue that matter right now and we
can get that issue out of the way so that we know where
we're going with it.
So if you have any argument on that point, I
will be happy to receive it and then we'll hear from
Mr. Fierberg and at least we can resolve that issue.
MR. DEAGUIAR: Respectfully, Your Honor, I
would submit that I was unable to find authority giving
this Court the jurisdiction to issue an order here.
However, what I would do is place the burden on the
Trustee to demonstrate jurisdiction in this case,
unless Miss Alonso would like to argue.
THE COURT: Miss Alonso, would you like to
add anything?
MS. ALONSO: No, Your Honor.
THE COURT: All right. Mr. Fierberg, do you
want to make any comments on the issue of this Court's
jurisdiction in the matter?
MR. FIERBERG: Yes, Judge. We had the
benefit of arguing this issue before Judge Utschig in

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we schedule some kind of a status conference in this
matter?
THE COURT: What do you think, a week? Next
week is Thanksgiving. Why don't we all come in on
Thanksgiving Day?
MR. FIERBERG: Are you serving the turkey?
Perhaps two weeks, Judge.
THE COURT: Well, that will work. Check with
Barbara because I will be here the week after, but then
I have a long scheduled vacation that's going to take
me out of the office for over a week. So let's get it
in before I go away, which I think I leave on December
2nd, and I will be back very quickly.
MR. FIERBERG: Shall I include that in the
order today, Judge, that a status conference is being
set for that day?
THE COURT: Is that a feasible way to go,
Counsel? Should we include that in the order?
MR. ANGUEIRA: Excuse me. The particular
order that says status quo, I don't know if that's
under seal or anything like that. Whether it is or
isn't, I don't know if you want to put another date of
another hearing like this that might become public.
MR. FIERBERG: My intention was it would all
be under seal as everything is.

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CERTIFICATE OF REPORTER

STATE OF FLORIDA )
: SS
COUNTY OF DADE )

I, GWEN M. TIPALDI, Notary Public in and for

the State of Florida at Large, do hereby certify
that I was authorized to and did report the
foregoing proceeding; and that the transcript is a true
record.

Dated this 14th day of September, 2005.

EN '" :' TIPALDI

- -

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