Free Motion for Reconsideration - District Court of Colorado - Colorado

Case 1:04-cr-00103-REB

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IN THE UNITED STATES DISTRICT FOR THE DISTRICT OF COLORADO CASE NO. 04-CR-103-RB UNITED STATES OF AMERICA, Plaintiff, v. 1. NORMAN SCHMIDT,

Defendant. _____________________________________________________________________ MOTION TO RECONSIDER COURT ORDER OF JANUARY 24, 2006, FINDING THAT NORMAN SCHMIDT HAS WAIVED ANY CLAIM OF ATTORNEY CLIENT PRIVILEGE ____________________________________________________________________ COMES NOW, Defendant Norman Schmidt, by and through his attorneys, Peter R. Bornstein and Thomas J. Hammond, and moves this Court to reconsider its Order dated January 24, 2006, in which the Court ordered that all defendants, including Norman Schmidt, have waived any claim of attorney client privilege respecting communications with respect to Gary Herbert, and that no attorney client privilege claim can be raised during the deposition of Mr. Herbert. As grounds, Mr. Schmidt states the following: 1. As the Court stated in its Order, counsel for Mr. Schmidt did indeed

receive the government pleading by way of ECF filing on January 12, 2006. Counsel also received the Order from the Court directing a response to the government's proposed areas of inquiry by January 19, 2006. 2. Counsel has no excuse for missing the Court's deadline. Undersigned 1

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counsel did discuss the case with Mr. Bornstein last week including the issues of a possible deadline for a response. For reasons that defy explanation, undersigned counsel did not realize that the deadline for a response was January 19, 2006, until counsel received the government's pleading dated January 23, 2006. Counsel realized at that time that he missed the deadline and began to draft a motion for an extension of time for the response. After a court appearance in the morning of January 24, counsel returned to his office only to find that the Court had issued its Order before the motion was finished. 17. Counsel could go over the last several weeks of his schedule of court

appearances, but it would still do nothing to excuse missing the deadline. 18. Nevertheless, the issue for Mr. Schmidt remains. There are a number of

instances raised in the government's proffer which require at least the attempt to raise the attorney client privilege on behalf of Mr. Schmidt. The issues must be raised by counsel for Mr. Schmidt, even if untimely, as will be discussed in more detail in this motion. 19. The government notes in page two of its proffer that it may inquire about

communications between Mr. Herbert, Mr. Schmidt and other co-conspirators related to any of the subject areas discussed further in the proffer. 20. While Mr. Schmidt may not object to the attachments which reflect articles

of organization of several of the business entities, or to tradename certificates, Mr. Schmidt would have a valid objection based upon attorney client privilege to any questions involving specifically what was discussed between himself and Mr. Herbert in the context of legal work he may have asked Mr. Herbert to perform.

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21.

Mr. Schmidt might not object to general questions about the legal work he

performed regarding Smitty's Motorsports LLC. However, Mr. Schimdt would have a valid objection on ground of attorney client privilege insofar as questions would be asked regarding the purpose of Smitty's Motorsports as it was explained to him (Mr. Herbert). Depending on the nature of the question asked, Mr. Schmidt would have a valid objection on the ground of attorney-client privilege as it pertains to his understanding of the persons controlling Smitty's Motorsports. Mr. Schmidt might have an objection based upon attorney client privilege to questions regarding the role of any alleged co-conspirators involved in the operation of Smitty's Motorsports. 8. Mr. Schmidt would not object to various questions pertaining to Mr. Herbert's

representation of Leon Harte, insofar as those questions involved identification of parties, nature of claims, or resolution of the case. Statements made by Norman Schmidt related to the litigation, however, would be covered by the attorney-client privilege. 9. If Mr. Herbert, in response to questioning by the government, responded that

he had disclosed to Norman Schmidt that Leon Harte testified that Harte had engaged in criminal activities, the substance of that conversation might well be covered by the attorney-client privilege. If Mr. Schmidt asked Mr. Herbert questions regarding the nature of Mr. Harte's communications to Mr. Herbert, those statements would be covered by the attorney-client privilege. 10. Depending on the manner in which questions are asked, regarding Mr.

Herbert's conversations with Mr. Schmidt in the Spring of 2000, those conversations would

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be covered by the attorney-client privilege. The government acknowledges as much by indicating an intention to question Mr. Herbert about the context in which the statements were made. 11. Aside from any other objections that Mr. Schmidt could make regarding the

cease-and-desist orders from the State of Nebraska, conversations Mr. Schmidt may have had with Mr. Herbert, concerning activities by Mr. Schmidt or Smitty's Investments in Nebraska, would presumably fall under the attorney-client privilege. 12. Mr. Schmidt would also raise the attorney-client privilege regarding the

preparation of the opinion letter written by Mr. Herbert in June, 2002. Mr. Schmidt would also object on the ground of attorney-client privilege to questions regarding the purpose and intended use of the letter as explained to Mr. Herbert. 13. Mr. Schmidt would also raise the attorney-client privilege regarding

discussions of securities issues with Mr. Herbert and a securities attorney in 2002. 14. Mr. Schmidt would object to questions regarding who requested Mr. Herbert,

to open an escrow account to receive investor funds, as described in the government's proffer at page 10, on the basis of attorney client privilege. 15. Discussions between Mr. Herbert and Mr. Schmidt, involving payments for

legal services would implicate the attorney-client privilege. 16. Mr. Schmidt would raise the attorney-client privilege generally regarding

questions to Mr. Herbert concerning the security of investor funds through the Northwest

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Group, although in this particular instance it may be that the discussions did not involve Mr. Schmidt. 17. Undersigned counsel has discussed the issue of this motion for

reconsideration with the government, specifically Mr. Kirsch. Mr. Kirsch has informed counsel that he intends to object to the late filing. It appears that the government may believe that counsel is filing this response late in order to simply delay the proceedings. Whatever else the Court or the government may believe regarding counsel's failure to file this response in a timely manner, delay of the proceedings is not, and has not been, counsel's intention. On the other hand, failure to raise these issues could constitute grounds for post trial proceedings which would not be available if the motion to reconsider is granted. Further, there is time to resolve these issues in a timely manner before the deposition occurs; the original Order required a deadline of January 19, 2006. This response, while admittedly and inexcusably late on the part of undersigned counsel, is five days overdue (counting the weekend), and it is not due to fault on Mr. Schmidt's part. Given the nature of this litigation, not to mention the amount of time the government has spent preparing its case, and the fact that Mr. Schmidt is owed a Sixth Amendment duty, counsel requests that the Court reconsider its Order and accept this late filing. WHEREFORE, Mr. Schmidt moves this Court to reconsider the Oder that Mr. Schmidt has waived any claim of attorney client privilege respecting communication between himself and Mr. Herbert.

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Respectfully submitted,

____________________________ Peter R. Bornstein 1600 Broadway, Suite 2350 Denver, Colorado 80202 (303)861-2500

_________________________ Thomas J. Hammond 1544 Race Street Denver, Colorado 80206 (303)321-7902 e-mail: [email protected]

CERTIFICATE OF SERVICE I hereby certify that on January 24, 2006, I electronically filed the foregoing MOTION TO RECONSIDER COURT ORDER OF JANUARY 24, 2006, FINDING THAT NORMAN SCHMIDT HAS WAIVED ANY CLAIM OF ATTORNEY CLIENT PRIVILEGE with the Clerk of the Court using the CM/ECF filing system which will send notification of such filing to the following e-mail addresses: Wyatt Burwell Angelo [email protected], [email protected] ; [email protected]; [email protected] Peter R. Bornstein [email protected], [email protected] Paul B. Daiker [email protected], [email protected] Ronald Gainor [email protected] Thomas Edward Goodreid 6

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[email protected] Matthew T. Kirsch [email protected] [email protected], [email protected] Declan Joseph O'Donnell [email protected] Daniel T. Smith [email protected], [email protected] Robert Patrick Sticht [email protected]

s/ Thomas J. Hammond Thomas J. Hammond

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