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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
_____________________________________

UNITED STATES OF AMERICA, §

§
Plaintiff, §
§
v. § No. 3:07-CR-289-08
§
ALLEN J. MCGILL, § ECF
§
Defendant. §

UNITED STATES’ RESPONSE

TO GAIL TERRELL’S MOTION TO QUASH SUBPOENA

Plaintiff United States of America files this Response to Motion to Quash

Subpoena and shows the Court the following:

BACKGROUND

Defendant Allen J. McGill (McGill) pled guilty and was sentenced in this Court on

April 2, 2010 to one count of Conspiracy to Commit Extortion, a violation of 18 U.S.C.

§ 371 (18 U.S.C. § 1951) (doc. 1334). In connection with the Judgment, McGill was

ordered to make restitution in the amount of $112,500 plus a $100 mandatory special

assessment. As of July 6, 2010, McGill paid his assessment, but has not made any

payments toward his restitution debt.

Because the restitution component of McGill’s sentence remains unsatisfied, the

United States seeks to collect his debt through all procedures available under the Federal

Debt Collection Procedures Act (FDCPA), 28 U.S.C. §§ 3001-3308. On June 9, 2010,

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the United States mailed a Notice to McGill’s spouse Gail Terrell (Terrell) attaching a

blank subpoena to ViewPoint Bank for the records of McGill and Terrell. See Pl.’s App.

Tab A. The Notice stated Terrell could complete the accompanying blank Motion to

Quash Subpoena if she believed the requested records were irrelevant to the investigation

of her husband’s finances and the United States has no legal basis for the release of the

records. Terrell filed the Motion to Quash on June 23, 2010 (doc. 1402) stating she “is

the sole account holder and signatory of ViewPoint Bank accounts. All monies in said

accounts were earned by Gail Terrell. No earnings of funds have been deposited into the

ViewPoint Bank accounts by Allen J. McGill.” The Motion was referred to Magistrate

Judge Jeff Kaplan on June 28, 2010 (doc. 1405), who ordered the United States to file its

Response to the Motion by July 20, 2010 and Terrell to file her reply to the United States’

Response not later than fourteen days thereafter (doc. 1409).

As part of its efforts to collect McGill’s restitution, the United States believes

ViewPoint Bank possesses documents and holds property in which McGill may have an

interest. The United States complied with the relevant provisions of the Right to

Financial Privacy Act, 12 U.S.C. §§ 3401-3422, to obtain the relevant documents by

providing the Notice and attached blank subpoena to Terrell.

The United States has a legal right to issue the subpoena and obtain the requested

information, therefore, United States requests that Terrell’s Motion be denied in its

entirety and the United States be allowed to subpoena documents held by ViewPoint

Bank.
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ARGUMENTS

I. The United States’ Subpoena Is Authorized Under The MVRA And FDCPA.

The United States has the authority under federal law to issue a civil subpoena in

McGill’s criminal case to enforce the restitution order. See United States v. Parlin, No.

3:03-CR-162-D, 2010 WL 1903991, at *1-2 (N.D. Tex. May 10, 2010) (unpublished) (see

Pl.’s App. Tab B) (Magistrate Judge Jeff Kaplan denied motion to quash United States’

subpoena issued in criminal case to enforce order of restitution); United States v. Miller,

No. 4:03-CR-170-A, (N.D. Tex. Nov. 8, 2005) (unpublished) (see Pl.’s App. Tab C)

(motion to quash United States’ subpoena issued in criminal case to enforce order of

restitution denied). The Mandatory Victim Restitution Act (MVRA), 18 U.S.C. §§

3663A-3664, authorizes the United States to enforce victim restitution orders in the same

manner that it recovers fines and by all other available means. See 18 U.S.C. §

3664(m)(1)(A); United States v. Phillips, 303 F.3d 548, 551 (5th Cir. 2002). The United

States is further authorized under 18 U.S.C. § 3613(a) to collect criminal fines, and thus

restitution, “in accordance with the practices and procedures for the enforcement of a

civil judgment under Federal law or State law.” 18 U.S.C. § 3613(a); Phillips, 303 F.3d

at 551. The FDCPA provides the procedures for enforcement of a civil judgment under

federal law. See 28 U.S.C. §§ 3001-3308; Phillips, 303 F.3d at 551. Sections 3004 and

3015 of the FDCPA expressly permit the United States to take discovery of a debtor’s

financial condition in the manner in which discovery is authorized by the Federal Rules of

Civil Procedure, including the issuance of a Fed. R. Civ. P. 45 subpoena. See 28 U.S.C.
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§§ 3004 and 3015; Fed. R. Civ. P. 45. Courts have universally held that civil subpoenas

issued for the purpose of collecting criminal restitution may be filed in the criminal case

in which restitution was ordered. See United States v. Idema, 118 Fed.Appx. 740, 742-44

(4th Cir. 2005) (unpublished) (see Pl.’s App. Tab D) (nothing prohibits government from

enforcing restitution order in same criminal case in which it was originally imposed);

Parlin, 2010 WL 1903991, at *1-2 (United States’ civil subpoena issued in criminal case

to enforce restitution order was proper); Miller, 4:03-CR-170-A, at *1-2 (United States’

civil subpoena issued in criminal case was proper); United States v. Patiwana, 267

F.Supp.2d 301, 304-06 (E.D.N.Y. 2003) (adopting Magistrate Report and

Recommendation) (disagrees with debtor’s argument that government may not issue civil

subpoena in criminal action because there is no “action or proceeding” pending under

FDCPA); see also United States v. Scarboro, 352 F.Supp.2d 714, 716-17 (E.D. Va. 2005)

(government permitted to enforce criminal restitution order by seeking a civil remedy in

criminal proceeding). Accordingly, the United States may use Fed. R. Civ. P. 45

subpoenas to enforce criminal judgments.

McGill currently owes the United States the entire restitution ordered by this

Court. In an effort to ascertain whether McGill has the ability to make payments in

connection with his debt, the United States properly issued a Fed. R. Civ. P. 45 subpoena

to ViewPoint Bank, which the United States believes holds property in which McGill has

an interest. Because federal criminal procedure and the FDCPA authorize civil

subpoenas to be issued in an existing criminal case and this Court retains jurisdiction to
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enforce its orders, Terrell’s Motion to Quash should be denied in its entirety.

II. The United States’ Subpoena Requests Information Relevant To McGill’s

Current Financial Situation.

The United States has a right to discover information regarding McGill’s ability to

satisfy the restitution ordered in his case. See Fed. Deposit Ins. Corp. v. LeGrand, 43

F.3d 163, 172 (5th Cir. 1995) (“The scope of postjudgment discovery is very broad to

permit a judgment creditor to discover assets upon which execution may be made.”).

Terrell incorrectly claims the requested information is irrelevant to the United States’

investigation of her husband’s financial situation since the funds in the ViewPoint Bank

accounts were solely earned by Terrell and no earnings were deposited in the accounts by

McGill. The financial information sought is relevant to the enforcement of McGill’s

restitution order and the United States has a legal basis to subpoena the documents

because McGill presumptively has a community property interest in any property held by

and for his wife. See T EX. F AM. C ODE A NN. § 3.003.

The Fifth Circuit has explicitly held that the United States is permitted to garnish

community property to collect criminal restitution under the FDCPA. See United States v.

Loftis, 607 F.3d 173 (5th Cir. 2010) where the Fifth Circuit specifically held that, to

enforce an order of restitution, the United States may garnish the following under Texas

community property law: (1) all of the debtor’s sole management community property;

(2) all of the couple’s joint management community property, including the non-debtor

spouse’s undivided one-half interest in such property; and (3) one-half of the non-debtor

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spouse’s sole management community property. See Loftis, 607 F.3d 173, 178-79.

Property possessed by either spouse during marriage is presumed to be community

property, and the degree of proof necessary to establish that the property is separate

property is clear and convincing evidence. See T EX. F AM. C ODE A NN. § 3.003.

Consistent with the presumption that all property possessed by either spouse during

marriage is community property, the party asserting that property possessed by one of the

spouses is that spouse’s separate property must, in addition to establishing a separate

property origin, “clearly trace the original separate property into the particular assets on

hand during the marriage.” Cockerham v. Cockerham, 527 S.W.2d 162, 167 (Tex. 1975).

Any doubt as to the character of the property is resolved in favor of the community estate.

See Boyd v. Boyd, 131 S.W.3d 605, 612 (Tex. App.-Fort Worth 2004, no pet.).

Furthermore, the designation of community property as sole management does not affect

the ability of a federal tax lien to attach to the property. See Loftis, 607 F.3d 173, 178-79;

Medaris v. United States, 884 F.2d 832, 833-34 (5th Cir. 1989).

Because McGill has a community property interest in property held in Terrell’s

name, the subpoena is sought to obtain financial records regarding property held in

McGill or Terrell’s name. While Terrell asserts that she - and not her spouse - earned the

funds held in the accounts, she has been married to McGill since 2002 and McGill

reported to the Pre-Sentence Report writer that they have been in a relationship since

1980, thus the accounts are presumptively community property under Texas law. In fact,

Terrell has failed to allege any set of facts that would establish the accounts are her
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separate property. Because the United States sought financial information on a third party

as well as the Defendant, the United States followed the procedures outlined in the Right

to Financial Privacy Act, which contemplates such a circumstance and outlines the proper

procedures to obtain the information. See 12 U.S.C. §§ 3401-3422.

In addition, Terrell’s assertion that she is the sole source of the funds held by

ViewPoint Bank does not overcome the United States’ legal entitlement to conduct

discovery into McGill’s financial affairs for the benefit of his victim. See United States v.

Hanhardt, 353 F.Supp.2d 957, 960-61 (N.D. Ill. 2004) (in determining that the court

cannot take into consideration whether defendant’s wife’s financial circumstances take

priority of his legal obligation to pay restitution, the court noted “[a] defendant’s criminal

conduct oftentimes has unfortunate consequences for his or her family.”). Terrell’s

Motion to Quash should, therefore, be denied.

III. Terrell Failed To Establish That She Is Entitled To A Protective Order.

Terrell has failed to establish that she is entitled to a protective order to prevent

disclosure of the requested information to the United States. A party seeking a protective

order must show good cause and a specific need for protection. See Fed. R. Civ. P.

26(c)(1); Landry v. Air Line Pilots Ass’n Int’l AFL-CIO, 901 F.2d 404, 435 (5th Cir.

1990), cert. denied, 111 S.Ct. 244 (1990). “Good cause” exists when justice requires the

protection of “a party or person from annoyance, embarrassment, oppression, or undue

burden or expense[.]” Fed. R. Civ. P. 26(c)(1). Conclusory assertions, unsupported by

facts, do not amount to “good cause” for a protective order. See In re Terra Int’l, Inc.,
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134 F.3d 302, 306 (5th Cir. 1998), quoting United States v. Garrett, 571 F.2d 1323, 1326

n.3 (5th Cir. 1978) (the burden upon a movant to show the necessity for a protective order

“contemplates a particular and specific demonstration of fact as distinguished from

stereotyped and conclusory statements”). Terrell has failed to meet this standard.

Terrell contends the United States’ subpoena should be quashed. Documents

sought from ViewPoint Bank, such as account signature cards and applications, monthly

bank statements, deposit and withdrawal slips, wire transfer records, and loan or credit

applications, are not inherently privileged or confidential. See Parlin, 2010 WL 1903991

at *2, citing Sec. & Exch. Comm’n v. W Financial Group, LLC, No. 3:08-CV-449-N,

2009 WL 636540, at *1 (N.D. Tex. Mar. 9, 2009) (noting that there is no legitimate

expectation of privacy in the contents of checks, deposit slips, or bank statements).

Secondly, while the United States is sensitive to minimizing embarrassment to

Terrell and does not intend to cause her undue burden or expense, the requested

information is necessary for the United States to determine McGill’s ability to repay his

restitution. Terrell has not established good cause to prevent the disclosure of the

requested information or a specific need for protection. It should be noted that Terrell

does not have to produce the requested information, so she will not incur an undue burden

or expense in the production of the documents.

IV. Terrell Does Not Have Standing To Oppose The Subpoena To The
Extent The United States Requests McGill’s Financial Information.

The subpoena is sought to discover assets held in the names of both McGill and

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Terrell. To extent that Terrell seeks to quash the subpoena with regards to her husband,

she lacks standing to do so. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-63

(1992).

CONCLUSION

For the foregoing reasons, the Court should deny Terrell’s Motion to Quash and

order that the requested documents be produced to the United States.

Respectfully submitted,

JAMES T. JACKS
UNITED STATES ATTORNEY

s/ Richard B. Vance
Richard B. Vance
Assistant United States Attorney
Texas Bar No. 20477000
Burnett Plaza Suite 1700
801 Cherry Street Unit #4
Fort Worth, Texas 76102
Tel: 817.252.5237
Fax: 817.978.6361
Richard.Vance@usdoj.gov

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CERTIFICATE OF SERVICE

I hereby certify that on this 8 th day of July 2010, a copy of the United States’

Response to Gail Terrell’s Motion to Quash Subpoena was delivered electronically or

mailed to the following:

Derek D. Brown
Law Office of Derek D. Brown
209 W. Second Street, Suite 197
Fort Worth, TX 76102
Attorney for Defendant

Gail Terrell
1445 Firebird Drive
Dallas, TX 75214

s/ Richard B. Vance
Richard B. Vance
Assistant United States Attorney
Texas Bar No. 20477000
Burnett Plaza Suite 1700
801 Cherry Street Unit #4
Fort Worth, Texas 76102
Tel: 817.252.5237
Fax: 817.978.6361
Richard.Vance@usdoj.gov

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