UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
January 10, 1975
FRED B. BLACK, JR., Plaintiff,
UNITED STATES OF AMERICA Defendant
The opinion of the court was delivered by: RICHEY
This matter is before the Court for decision on the issue of damages after trial of the facts concerning damages. This Court previously found the United States liable in tort to the Plaintiff Black by granting partial summary judgment for Plaintiff on theories of trespass, invasion of privacy by intrusion, invasion of privacy by publication, and violation of Constitutional rights. These intentional torts arose out of the Federal Bureau of Investigation's admittedly illegal electronic surveillance of Plaintiff's suite in the Sheraton Carlton Hotel in Washington, D.C., between February 7 and April 25, 1963.
The following constitute the Court's findings of fact and conclusions of law.
The Court concludes that this action is principally an action to recover for Plaintiffs losses caused by the intentional and admittedly illegal intrusion upon the Plaintiff's privacy and the publication of information derived from that illegal intrusion. As such this action is not barred by sovereign immunity since the United States has consented to suit through the Federal Torts Claims Act, 28 U.S.C. 2671 , et seq. The intentional torts complained of herein are not among the exceptions in 28 U.S.C. § 2680(h). Thus, 28 U.S.C. 1346(b) confers jurisdiction on this Court to hear this complaint.
The FBI's Electronic Eavesdropping and Dissemination of Information Constitute a Tortious Intrusion and Publication Which Violated Plaintiff's Right to Privacy
In two memoranda submitted to the United States Supreme Court in May and July 1966, in Black's tax case, the Solicitor General of the United States revealed that the FBI had illegally eavesdropped upon Black. It was there revealed that on the afternoon of February 7, 1963, agents of the Federal Bureau of Investigation installed a tubular microphone through the common wall of a room adjoining the suite occupied by Black at the Sheraton Carlton Hotel in Washington, D.C. The microphone extended through the six inch common wall and one-fourth of an inch into the one-half inch molding of Black's suite. FBI agents began to eavesdrop on conversations in Black's suite on the afternoon of the following day and continued the eavesdropping until April 25, 1963.
No recording of any portion of the monitored conversations exists. The assignment of the monitoring agents was to keep a contemporaneous log in which were summarized the conversations in petitioner's suite. A tape recorder was available and was used to record particular conversations whenever a monitoring agent felt that such a recording would be helpful in preparing his summaries. After the summaries were prepared, the tapes were erased. While none of the recordings are, consequently, available today, the handwritten notes of the monitoring agents do exist. These notes summarize the conversations and, in some instances, contain excerpts from conversations.
The information concerning petitioner obtained by the monitoring agents was submitted to their superiors in the Federal Bureau of Investigation in the form of the handwritten notes or logs. The eavesdrop information was then included in airtels, internal FBI documents disseminated by the Washington Field Office to FBI headquarters and to various other field offices.
Some of the eavesdrop information was then incorporated into two FBI reports and two memoranda. The reports, dated April 17, 1963 and July 12, 1963, were then transmitted by the Federal Bureau of Investigation to the Criminal Division of the Department of Justice, and the memoranda, dated April 5, 1963 and April 9, 1963, were sent to the Attorney General with copies to the Criminal Division. The date on which the April 1963 report was received by attorneys in the Organized Crime and Racketeering Section is not known, but it was transmitted to the Office of the Assistant Attorney General in charge of the Criminal Division, where it was received on November 6, 1963. The July 1963 report was received in the Organized Crime and Racketeering Section on August 2, 1963, and in the Office of the Assistant Attorney General in charge of the Criminal Division on October 28, 1963. The memoranda were received in the Office of the Attorney General on April 5 and April 9, 1963, respectively. The reports did not disclose that the information contained in them had been obtained by electronic eavesdropping.
At the time one of the functions of the Organized Crime and Racketeering Section of the Department of Justice was to analyze, correlate, index and file information contained in the various intelligence reports submitted to it, and to disseminate the information which it had received and broken down to the 26 federal agencies involved in the Government's drive against organized crime. This procedure was followed with respect to the FBI reports concerning Mr. Black.
In his memorandum to the Supreme Court the Solicitor General stated that the FBI reports of April 17, 1963, and July 12, 1963, were "captioned anti-racketeering since these dealt with [Black's] possible affiliation with organized crime activity in the United States." (Emphasis added.) However, in a footnote to this statement the Solicitor General stated that, "Recital of these facts is not intended to suggest that any wrongdoing on the part of [Black] was uncovered by the monitoring."
The Government's Refusal to Comply with Discovery Orders Resulted in This Court's Imposition of Sanctions Under Rule 37(b) (2) (A)
The procedural steps leading to this Court's imposition of Rule 37 sanctions were as follows:
"On July 10, 1973, this Court ordered the United States to allow the Plaintiff to inspect and copy: (1) all documents containing leads obtained from the eavesdropping, including the FBI reports of April 17, 1963 and July 12, 1963; (2) all communications in response to the eavesdropping material, including any airtels the Washington, D.C. office of the FBI received in response to the airtels it sent out requesting information concerning the Plaintiff; and (3) all documents relating to the leaving in place of the microphone after April 25, 1963 and any subsequent activation of the microphone. As of this date the United States has refused to comply with this order. It has refused to do so based on its claim of executive privilege which was made in an affidavit by the then Attorney General Elliot Richardson and filed October 19, 1973. The affidavit claims executive privilege as to the remainder of the file -- that which had not previously been disclosed.
"The Court has granted the Plaintiff's Motion for Partial Summary Judgment on the issue of liability, since the United States has admitted that it conducted the surveillance and disseminated the information obtained as a result of the surveillance. The sole issue remaining is the question of damages. The Plaintiff maintains that the documents he seeks are necessary to substantiate his claim for damages caused by the dissemination of the surveillance information and its fruits. Earlier, the Court felt the information the Plaintiff needed could be obtained without disclosure of the documents. The Court, therefore, found that the Plaintiff's need did not outweigh possible public interest in maintaining the confidentiality of the files. However, the suggested alternative -- deposing the FBI agents involved in the surveillance regarding dissemination of the information -- has proved to be an inadequate method of obtaining the necessary evidence."
371 F. Supp. 97, 99 (D.D.C. January 21, 1974).
On January 21, 1974, the Court found that the claim of executive privilege was improperly asserted in Black v. Sheraton Corp., 371 F. Supp. 97 (D.D.C. 1974). The Court issued its July 10, 1973 order for discovery before the government entered the Attorney General's affidavit which allegedly supported the government's claim of executive privilege. Upon consideration of this affidavit the Court explained the insufficiency of the belated claim in the January 21, 1974, opinion.
The continued refusal by the government to comply with the discovery order forced the Court to impose sanctions in accordance with Rule 37(b)(2)(A) of the Federal Rules of Civil Procedure. These sanctions established for the purpose of the case the truth of the following allegations in the complaint:
"(1) that the FBI reports or the information contained therein caused the Plaintiff to lose his employment as a Washington representative for major national corporations; (2) that the FBI reports or the information contained therein have destroyed the Plaintiff's livelihood and permanently impaired his ability to obtain employment; (3) that the FBI reports or the information contained therein have greatly damaged the Plaintiff's name and reputation and have caused him the loss of friends and business associates; and (4) that the FBI reports or the information contained therein have caused the Plaintiff great mental pain and suffering, embarrassment and humiliation."
Effect of the Rule 37 Sanctions on the Damages Issue at Trial
Partial summary judgment and the Rule 37 sanctions foreclosed the issue of liability and left for trial only the determination of damages. The Court was faced with the difficult task of framing the issue for trial in light of the fact that the government-withheld documents were clearly necessary for Plaintiff's proof of the causal connection between the unlawful intrusion and publication, on the one hand, and the alleged extensive damage to Plaintiff's business and livelihood. Moreover, the government claimed that there were other independent causes of Plaintiff's business and personal losses.
The Court issued an order on October 7, 1974, which denied Plaintiff's motion for a partial summary judgment on the amount of his business claims and which framed the trial issues, providing, inter alia, the following:
"The Defendant will be liable to Black for damages which were proximately caused by the government's tortious conduct. This is the ultimate issue for trial. The effect of the Court's sanctions is that it will be deemed established for trial that Plaintiff has made a prima facie showing of causation in fact; that is, that the government's conduct was a material element and a substantial factor in bringing about the business and personal losses to Black.
But if, as the government contends, there were other independent causes of Black's losses and if there is a logical and reasonable basis for apportioning Black's loss to each cause, a division or apportionment will be made. But if no such reasonable basis can be shown by the government, then the United States will bear the entire loss notwithstanding the fact that other causes may have contributed to the losses. The government will bear the burden for showing this reasonable basis for apportionment. See Prosser, Torts § 52 (4th Ed.).
The ultimate factual issue of what damages have been proximately caused is a concept incapable of a universal formula. Considerations will include, but will not be limited to, (1) causation in fact, (2) apportionment of damages, (3) foreseeability of results, and (4) intervening causes. Consideration of these and other factors will be made by the Court in light of the conclusion that the United States is liable for intentional torts. See, generally, Prosser, Torts, ch. 7-8 (4th Ed.)."
Principles of due process require a court to impose Rule 37 sanctions if the defendant refuses to produce documents which are essential for the Plaintiff to prove his allegations or for the Plaintiff to negate the defendant's defense. The sanctions are not imposed as a deterrent or punishment alone, although they obviously have such an effect. Rather, the sanctions relieve the Plaintiff of a burden he should not have to bear without the documents. Therefore, the Court must carefully fashion the effect of the sanctions not only on the Plaintiff's allegations, but also on the Defendant's defense. "The preservation of due process [is] secured by the presumption that the refusal to produce evidence material to the administration of due process [is] but an admission of the want of merit in the [government's] asserted defense." Hammond Packing Co., v. Arkansas, 212 U.S. 322, 351, 53 L. Ed. 530, 29 S. Ct. 370 (1909).
The interests of due process dictate that the burden to apportion damages or to show that other causes were "intervening causes" be placed on the government under the unusual circumstances of this case. First, the effect of the sanctions requires that the government at least have the burden of going forward with the evidence at trial on the issue of proximate cause; otherwise, the sanctions would have no effect at all. Secondly, the government denied Plaintiff access to the FBI documents which, by themselves, may have provided evidence of proximate cause or else may have lead to such proof. Under those circumstances, it was unduly unfair to place upon Plaintiff the burden of negating each of the other allegedly independent causes which the government asserts to have intervened and to have caused Black's business and personal damages.
Damages for Loss of Employment, Loss of Livelihood, and Loss of Ability to Obtain Employment
The FBI reports or the information contained therein caused the Plaintiff to lose his employment as a Washington representative for major national corporations. The FBI reports or the information contained therein have destroyed Plaintiff's livelihood and permanently impaired his ability to obtain employment.
A reasonable basis for determining business/livelihood losses from the date of the tort to trial date is Black's income for the five years prior to the tort. These figures have been established in prior litigation between Black and IRS.
For the five years prior to the start of the eavesdropping in February 1963, Black's gross and taxable income from his employment as a Washington representative was as follows:
Year Gross Income Taxable Income
1958 $300,919.25 $191,432.17
1959 286,818.08 195,240.77
1960 349,503.26 249,693.69
1961 433,527.92 202,879.84
1962 542,779.60 244,341.42
Black's average taxable
income for these five
years was $216,717.00.
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