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1
2 JUDGE CHAPPELL: All right. We're in recess.
3 (Recess)
4 JUDGE CHAPPELL: We're back on the record, and
5 if I failed to state it earlier, we went back into
6 public session before I recessed last time, so we're not
7 in in camera session at this time.
8 Where are we?
9 MR. SHERMAN: Your Honor, I believe when we
10 recessed the court was interested to hear from counsel
11 for Rick Wallace concerning the public nature of the
12 investigation and I think he has spoken with oversight
13 and is ready to address the court on that issue.
14 JUDGE CHAPPELL: Before we do that, the letter
15 that was handed to me which I won't discuss, do the
16 parties agree that I can mark this as JX 6 and I'll give
17 it provisional in camera treatment I'm sorry I think
18 it's /KWR*BGS 3 would be the next JX.
19 MR. SHERMAN: I have no objection.
20 MS. VANDRUFF: And complaint counsel has no
21 objection, although we do not have a copy of that
22 document, Your Honor, so if --
23 JUDGE CHAPPELL: You can read it, but you can't
24 have a copy of it.
25 MS. VANDRUFF: Thank you, Your Honor. May I
0020
1 approach, Your Honor.
2 JUDGE CHAPPELL: Yes. If you both haven't read
3 it, you can look at it. I don't want copies floating
4 around.
5 MS. VANDRUFF: Understood, Your Honor.
6 Thank you.
7 (Pause in the proceedings.)
8 JUDGE CHAPPELL: Am I correct that the next
9 joint exhibit would be Number 3?
10 MS. VANDRUFF: That's correct, Your Honor.
11 MR. SHERMAN: That's my understanding,
12 Your Honor. We had discussed JX 2 yesterday and I
13 believe JX 3 is the next joint exhibit number.
14 JUDGE CHAPPELL: All right. So what I have in
15 my hand, Mr. Sherman, do I have a motion from you to
16 make JX 3 an exhibit?
17 MR. SHERMAN: So moved.
18 MS. VANDRUFF: No objection, Your Honor.
19 JUDGE CHAPPELL: All right. JX 3 is in
20 evidence, but I'm giving it provisional in camera
21 treatment so it won't be part of the public record.
22 (Joint Exhibit Number number was admitted into
23 evidence.)
24 MS. VANDRUFF: Do you require a motion to accord
25 JX 3 in camera treatment?
0021
1 MR. SHERMAN:
2 JUDGE CHAPPELL: I'm going to consider whether
3 or not it contains sensitive information, which is an
4 exception to a motion and we will let the parties know
5 if we require a motion.
6 MS. VANDRUFF: Thank you, Your Honor.
7 MR. SHERMAN: Thank you, Your Honor.
8 JUDGE CHAPPELL: All right. Who wants to give
9 me an update?
10 MR. BURCK: Your Honor, William Burck,
11 Quinn Emanuel, for Robert Boback.
12 After our discussion this morning in camera I
13 did contact the committee staff for.
14 JUDGE CHAPPELL: And who's the lady with you?
15 MR. BURCK: This is /HRAURPB Dick /KEU my
16 colleague from Quinn Emanuel. We both represent
17 Mr. Wallace.
18 JUDGE CHAPPELL: /HR-FRPLT thank you.
19 MR. BURCK: The committee staff for
20 Chairman Issa have to objection to the disclosure of the
21 fact of the investigation of Tiversa.
22 JUDGE CHAPPELL: I'm reminding you we are in
23 public session.
24 MR. BURCK: Yes, Your Honor. And again, they
25 have no objection to that the disclosure of the fact of
0022
1 that investigation.
2 JUDGE CHAPPELL: Well, then do you have an
3 objection to the Exhibit JX 3 being part of the public
4 record.
5 MR. BURCK: Your Honor, I do not have an
6 objection to that.
7 MR. SHAW: I apologize /H-RBGS Your Honor.
8 Your Honor, my name is Jarad /SHAUFPLT I'm with the law
9 firm of Reed Smith and I represent Robert Boback, the
10 CEO of Tiversa. I would at least at this point offer an
11 objection to disclosing this publicly given that Tiversa
12 first learned about this investigation about an hour ago
13 and hasn't had an opportunity to communicate with the
14 committee staff or gain an understanding of what the
15 investigation relates to. So given its lack of
16 knowledge and the fact that this is a committee
17 investigation of its /KOERBGS it would assert that the
18 communication should remain confidential.
19 JUDGE CHAPPELL: All right. I won't speak any
20 more about the investigation at this time. The document
21 will remain in camera provisionally at this time, JX 3.
22 What I want to know now is about the status of testimony
23 of these witnesses so we don't need to get into anything
24 else about what the committee is doing.
25 MR. BURCK: Certainly, Your Honor. Mr. Wallace
0023
1 is prepared to take the stand; however, as I mentioned
2 earlier, he would not be answering any substantive
3 questions today. He would stand on his rights.
4 JUDGE CHAPPELL: He plans to invoke the fifth.
5 MR. BURCK: Yes, Your Honor.
6 JUDGE CHAPPELL: What about Mr. Boback?
7 MR. SHAW: Your Honor, Mr. Boback just learned
8 about this letter, as I said, at approximately 10:00
9 this morning.
10 JUDGE CHAPPELL: Just so we're clear I don't
11 need a lot of dills have you advising your client to
12 invoke the fifth if he.
13 MR. SHAW: If you are unwilling to stay this
14 proceeding and law medicine to prepare high client to
15 learn Mr. Boback is not going to appear for his
16 testimony today.
17 JUDGE CHAPPELL: Well, either he's going to
18 invoke the fifth or he's going to testify which is it.
19 MR. SHAW: Your Honor, the third /OPLGS is if
20 you won't permit due process rights and law me.
21 JUDGE CHAPPELL: Whoa whoa /STKPWOEPBT be saying
22 I'm denying your due process you might want to step back
23 and think about making accusations to this court.
24 MR. SHAW: All I would /SK-Z did you here that I
25 just said I want on you to withdraw those remarks.
0024
1 MR. SHAW: I withdraw those remarks.
2 JUDGE CHAPPELL: Thank you, go ahead slaw Shaw I
3 would just request could /SOPLT of time a couple of days
4 to understand what the investigation is about so I can
5 adequately understand the scope of the investigation so
6 that I can properly counsel him on whether or not to
7 respond to these questions that may be asked at this
8 proceeding.
9 JUDGE CHAPPELL: All right. Mr. Sherman, are
10 you the one calling these witnesses?
11 MR. SHERMAN: I am, Your Honor.
12 JUDGE CHAPPELL: What have you got to say?
13 MR. SHERMAN: Your Honor, as I stated this
14 morning, my reasons for requesting the stay were twofold
15 basically and one was that we believe that Mr. Wallace
16 will be granted the immunity that he seeks and therefore
17 be permitted to come into this court and give full
18 disclosure concerning his knowledge with regard to
19 central issues in this case.
20 I secondly, out of my sense of fairness and what
21 I believe best serves justice, indicated that I was
22 willing to disclose to counsel for Mr. Boback that there
23 was an ongoing investigation, however recent, to give
24 them an opportunity in fact to prepare and give him an
25 opportunity in fact to advise his counsel given that
0025
1 back/TKROFPLT thirdly, Your Honor, I believe that if a
2 stay is granted, it will also give the commission an
3 opportunity to reevaluate its case in light of evidence
4 which may come out in the next few days so that they can
5 make a determination as to whether or not they wish to
6 continue to proceed with this complaint.
7 That's still our position, Your Honor. And I
8 again think that it's in the best interest of justice
9 that this matter be stayed so that those determinations
10 can be made in light of the facts that are likely to
11 come out within the next two weeks concerning central
12 issues in this matter.
13 JUDGE CHAPPELL: Well, here's my concern. If
14 you've ever dealt with committees down the street
15 something set for June 5 clearly doesn't mean it's going
16 to happen on June 5. Things get rescheduled at the last
17 minute. It may be months from now before they ever have
18 a hearing down the street. So it's not a good idea to
19 peg anything based on a date that anybody knows about
20 right now. What I can do is grant a recess or a stay
21 for a set period of time. But you need to know,
22 Mr. Sherman, that if someone does invoke the fifth
23 there's a rule 3.39 here that counsel requesting
24 testimony has to file a motion we have a process and a
25 procedure for that.
0026
1 MR. SHERMAN: I understand. I was advise /-TD
2 of that rule by my counsel last night and would intend
3 to invoke its privileges should the situation present
4 itself.
5 JUDGE CHAPPELL: All right. So if I'm clear,
6 the attorneys for Boback and Wallace are not clear yet
7 what direction they're going with their clients, in
8 other words, were /*R whether they're going on to be
9 able to testify here or not;.
10 MR. SHAW: That is a fair statement.
11 MR. BURCK: Your Honor, Mr. Wallace will not
12 testify today. He will take the Fifth if he is required
13 to appear.
14 JUDGE CHAPPELL: Okay. Is sit your plan to
15 allow him to testify if he's granted immunity?
16 MR. BURCK: Your Honor, my plan would be to
17 allow him to testify if the immunity he's granted would
18 cover the testimony he'd provide here as well.
19 JUDGE CHAPPELL: Correct. .
20 Are you negotiating /THAFT at this time?
21 MR. BURCK: Your Honor, we are in discussions
22 with the committee, yes.
23 JUDGE CHAPPELL: Do those discussions include a
24 mention of these proceedings so we don't have to go
25 through our own immunity process here?
0027
1 MR. BURCK: Your Honor, at this stage I would
2 say that the discussions are very broad, so I think that
3 it would be fair to say that these proceedings would
4 also be covered by the owe certainly subject matter of
5 the discussions we're having with the committee.
6 JUDGE CHAPPELL: All right. All right. Well,
7 /TPUP if respondent wants to call these witnesses, they
8 will do so and if the witness invokes the
9 Fifth Amendment, then we will then have to deal with
10 that on a motion from the respondent's counsel if they
11 want to pursue the testimony. That means we would have
12 to invoke our process whereby immunity is granted by the
13 attorney general. After I make a determination based on
14 your motion. We're not there yet. I was under the
15 impression we were there right now, but it sounds like
16 we're not a hundred percent there regarding the fifth
17 especially for one witness.
18 Does the government have anything to say.
19 MS. VANDRUFF: Well, Your Honor, with respect to
20 Mr. Sherman's statement about the three bases on which
21 he seeks Your Honor's continuance, I can represent this,
22 which is that these are newly developing facts that we
23 learned of only very recently and in light of them that
24 we in consultation with respondent's counsel this
25 morning did agree that we would consent to a two-week
0028
1 stay, not an indefinite stay, Your Honor, but we think
2 that the interest of justice would be served by allowing
3 for a two-week stay. However, with respect to
4 Mr. Sherman's representations about the conduct of
5 the -- or excuse me the response of the commission in
6 that interim period of course I cannot speak to that in
7 the abstract. I have no more facts than Your Honor
8 does.
9 (Pause in the proceedings.)
10 JUDGE CHAPPELL: I'm inclined to grant the stay
11 request but not two full weeks. I'm thinking Thursday,
12 the 12th rather than Friday the 13th.
13 MR. SHERMAN: Your Honor, I would ask
14 procedurally that the court inform the witnesses who are
15 subject to the subpoenas that required them to appear
16 today that any such stay to that date, it would be the
17 court's expectation that they would honor the subpoenas
18 and appear on the date set by the court.
19 JUDGE CHAPPELL: Is there a problem with that?
20 MR. SHAW: Your Honor, yes, for Mr. Boback.
21 Unfortunately Mr. Boback has a scheduled trip to Africa
22 from June 8 to June 24. .
23 JUDGE CHAPPELL: What do you propose now,
24 Mr. Sherman? That's almost a month.
25 MR. SHERMAN: I propose we take Mr. Boback's
0029
1 testimony today.
2 JUDGE CHAPPELL: Mr. Boback has been deposed?
3 MR. SHAW: Yes, Your Honor.
4 JUDGE CHAPPELL: What about a deposition of
5 Mr. Boback before he leaves for his ankle can trip.
6 MR. SHAW: Mr. Boback with the simple caveat of
7 understanding this committee hearing on how they'll
8 respond would most certainly make himself available as a
9 convenience to get that taken care of.
10 JUDGE CHAPPELL: And I think you told me,
11 Counselor, that you intend to inquire into areas beyond
12 the previous deposition?
13 MR. SHERMAN: That's correct, Your Honor.
14 JUDGE CHAPPELL: Any objection to a follow-up
15 deposition of Mr. Boback before he leaves the country?
16 MS. VANDRUFF: No objection from complaint
17 counsel, Your Honor.
18 MR. SHERMAN: I'm willing to take that
19 testimony, Your Honor.
20 JUDGE CHAPPELL: And keep in mind, there's a
21 very good chance that that deposition will be accepted
22 in lieu of live testimony when you prepare for that
23 deposition. Understood?
24 MR. SHERMAN: I understand, Your Honor.
25 MS. VANDRUFF: Understood, Your Honor.
0030
1 Thank you.
2 MR. SHAW: Thank you, Your Honor.
3 JUDGE CHAPPELL: So we will reconvene on
4 June 12. However, if the parties are aware of the
5 change in status in that we can move ahead sooner, I'd
6 like to know immediately. I think you should go ahead
7 and schedule the deposition I guess give him a while to
8 work out what's going to happen down the street so he
9 can get some information. And it sounds to me like that
10 the attorney for Mr. Wallace doesn't think it's going to
11 take two weeks to get an answer on what he's working on
12 is that correct.
13 MR. BURCK: Your Honor, it's hard to say at the
14 moment, but I do believe there will be developments in
15 the next two weeks that would be useful for the court to
16 know.
17 JUDGE CHAPPELL: Okay. So what I'm going to do
18 then is it's not a stay it's going to be a recess. And
19 we're going to reconvene no later than 0930 on June 12,
20 but I expect to be advised by the parties on any new
21 developments and including could we go forward before
22 June 12.
23 MR. SHERMAN: Your Honor, may I request that the
24 court require the parties to disclose the deposition
25 date of Mr. Wallace -- I'm sorry -- of Mr. Boback by
0031
1 Tuesday of next week.
2 JUDGE CHAPPELL: Is that acceptable to you?
3 MR. SHAW: Yes.
4 MR. SHERMAN: Secondly, Your Honor, I would
5 request that Mr. Boback be required to travel to
6 Washington, D.C. for that deposition.
7 MR. SHAW: I would request that the deposition
8 take place in Pittsburgh where he resides.
9 JUDGE CHAPPELL: I'll tell you what's going to
10 happen. The parties are going to work that out. I'm
11 not going to I'm giving you the deposition he's agreed
12 to it. You people work out where it's going to happen.
13 MR. SHAW: I agree.
14 JUDGE CHAPPELL: Anything further?
15 MR. SHERMAN: Nothing further, Your Honor.
16 MS. VANDRUFF: Nothing further from complaint
17 counsel, Your Honor.
18 JUDGE CHAPPELL: So we will pause until June 12
19 with the caveat that we may come back sooner if
20 developments require that or allow that is that okay
21 with everyone.
22 MR. BURCK: Yes, Your Honor.
23 MR. SHAW: Yes, Your Honor.
24 JUDGE CHAPPELL: Anyone feel like their due
25 process rights have been trampled on?
0032
1 MS. VANDRUFF: Not at all.
2 MR. SHERMAN: Absolutely not, Your Honor.
3 MR. BURCK: Not at all.
4 MR. SHAW: No, Your Honor.
5 JUDGE CHAPPELL: All right. With that, hearing
6 nothing further, we are in recess.
7 *****END OF ROUGH DRAFT*****
8