Last month’s article regarding how to initially respond to an ATFE notice of revocation elicited numerous requests for more information on this topic. That article discussed the various preliminary steps that should be undertaken to best protect your rights. This article will discuss the discovery process that follows the submission of an answer to the ATFE citation. Let me emphasize, as I did in the first article, that an experienced attorney should represent you throughout the process.
After the answer has been filed, each party (the government and the targeted business) has the opportunity to request discovery from the other. Discovery is a legal term that means what it says; each party may learn (discover) what written materials and oral statements each party possesses.
Documents are provided by each party in response to a written notice to produce documents. Generally, the only limitation for a request to produce is that the documents requested are either relevant to the issues of the action, or that the request may reasonably lead to information that is relevant. This is a very broad standard. Accordingly, absent a claim that the document contains privileged information or that the document itself is irrelevant, the responding party is required to produce it in the manner that it had been kept. Issues of confidentiality such as trade secret, or the identity of a confidential informant, can be protected by use of a confidentiality agreement to be signed by all parties before the documents are produced.
As a business owner, you would want to discover what documents the government has created, used or obtained relating to your case. You would also want to discover the identity of all individuals that have personal (as opposed to second-hand) knowledge of your case. It may also be important for you to obtain information regarding the training history of, as well as copies of the training materials provided to, the agent(s) that performed the inspection that led to the revocation action.
After you have gathered all of the documents requested from the government, you should consider obtaining the oral testimony of those individuals that you expect the government to call as a witness. These individuals may be government agents or individuals that the government has ‘recruited’ to testify against you. Most often, these ‘recruits’ have their own agenda and are offering their testimony against you in return for a promise of leniency with respect to their matter.
By taking the oral examination, under oath (commonly known as a deposition), of government witnesses you will establish their story and, at the same time, observe both the breadth and depth of their knowledge of the facts, events and the documents produced. Also, you should be able to discover inconsistencies by and between the stories each individual offers. Inconsistencies generate issues of credibility, and no party wants to lack credibility. Since the deposition transcript of a witness may be used at future proceedings to prove an inconsistency in testimony provided by that witness, depositions are a valuable tool to establish inconsistencies and undermine credibility.
Oftentimes, the language of the regulation cited by the government is vague and ambiguous and, as a result, the investigator is given wide discretion that is suspect to misinterpretation and abuse. In some instances, reference to legislative history, revenue rulings, or the ‘General Questions’ section of the Federal Explosives Law, can assist in deriving the objective of a specific regulation. More often than not, you should be able to exploit the inherent shortcomings of the language of a specific regulation, and also persuade the government to agree. For example, the table of distances, inhabited buildings and place of assembly designations, and the standards relating to container markings often create instances of an illogical and misguided interpretation and result.
To summarize, thorough discovery will permit you to establish arguments that are both reasonable and defensible. It also provides the tools needed to exploit the weaknesses in the government’s case against you. It should be encouraging to know that the power of the information generated by discovery is generally enough to start meaningful settlement negotiations.
In my experience, not all ATFE revocations proceedings are assigned and heard by an administrative law judge. With some tact and skill, you may be able to get the agency to agree to meet ‘informally’ with the principals of the targeted business. If you succeed in obtaining such a meeting, it is important that you have rehearsed your facts, records and arguments. At the meeting, you may be able to win over the government; indeed, I recently had the occasion where the field agent, not the client, became the focus of our meeting. The matter was quickly resolved by stipulation on favorable terms, and I understand that the overzealous agent has since been reassigned from the field to a desk job.