Quick Summary
United States (plaintiff) involved Stephen M. Rakes (defendant) and Julie Rakes (defendant), who were accused of perjury and obstruction of justice related to their testimony about the forced sale of their liquor store business, Stippo’s Inc., allegedly under threat from James ‘Whitey’ Bulger.
The central issue was whether their private marital discussions could be suppressed under marital-communications privilege or disclosed under the crime-fraud exception. The First Circuit Court upheld the suppression, affirming that they were victims and not participants in a crime.
Facts of the Case
Stephen M. Rakes (defendant) and his wife Julie Rakes (defendant) were married in 1978 and embarked on various business ventures together, including opening a liquor store through their corporation, Stippo’s, Inc. The government suspected that notorious gangster James ‘Whitey’ Bulger threatened Stephen to include Bulger or his associates as partners in the store.
Subsequently, the Rakeses sold Stippo’s at a price the government believed was far below its actual value. Stephen later testified before two grand juries, denying any threats influenced the sale. In May 1996, Stephen was indicted on charges of perjury and obstruction of justice based on his grand jury testimony.
He moved to suppress evidence of conversations with Julie about the threats and sale of Stippo’s, claiming marital-communications privilege. Although divorced at the time of the motion, all relevant communications occurred during their marriage. The government countered, arguing that these communications were part of an ongoing crime-fraud exception to the privilege.
Procedural History
- Stephen and Julie Rakes sold Stippo’s, Inc. under suspicious circumstances believed to be due to extortion by James ‘Whitey’ Bulger.
- Stephen Rakes provided testimony before two federal grand juries, denying any threats influenced the sale.
- Rakes was indicted on charges of perjury and obstruction of justice.
- Stephen Rakes filed a pretrial motion to suppress evidence of conversations with his former wife, asserting marital-communications privilege.
- The district court granted the motion to suppress with one exception.
- The government filed an interlocutory appeal with the United States Court of Appeals for the First Circuit.
I.R.A.C. Format
Issue
- Whether the marital-communications privilege applies to conversations between Stephen and Julie Rakes about alleged threats and the sale of Stippo’s.
- Whether these communications are exempt under the crime-fraud exception to the privilege.
Rule of Law
Confidential communications made between spouses during marriage are generally protected under the marital-communications privilege unless they are made for the purpose of committing a crime, known as the crime-fraud exception.
Reasoning and Analysis
The court reasoned that although the marital-communications privilege generally protects confidential communications made between spouses during marriage, there is an exception for communications made in furtherance of a crime or fraud. However, in this case, the court determined that Stephen and Julie Rakes were not participants in the alleged extortion scheme but rather victims.
As such, their communications regarding the extortion threats were not made for the purpose of committing a crime but were instead part of their responses as victims. Therefore, their conversations remained privileged and were not subject to disclosure under the crime-fraud exception.
The court also addressed the government’s argument that Stephen Rakes waived his privilege by disclosing Bulger’s threats to a third party. It concluded that limited disclosures made under duress do not necessarily waive the privilege, especially when full details of privileged communications are not disclosed. The court affirmed that without wrongful complicity by the privilege holder, there is no forfeiture of privileged status.
Conclusion
The court affirmed the district court’s decision to grant Stephen Rakes’ motion to suppress evidence of conversations with his former wife under marital-communications privilege, rejecting the government’s assertion of the crime-fraud exception.
Key Takeaways
- The marital-communications privilege protects confidential communications between spouses during marriage unless they are made for the purpose of committing a crime or fraud.
- The crime-fraud exception requires active complicity in a crime for forfeiture of privilege; mere victim status does not suffice.
- Limited disclosure of privileged information under duress does not necessarily waive the privilege.
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References
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