United States v. Boswell

In United States v. Boswell, —- F.4th —-, No. 23-30315 (5th Cir. July 23, 2024), the Fifth Circuit reversed one of the defendant’s convictions for a statute of limitations violation because “the Government failed to establish a legitimate prosecutorial purpose for sealing [his] indictment.”

Background: On July 13, 2018, the Government indicted Boswell for “Concealment of Assets” under 18 U.S.C. § 152(1), and the same day, it moved for and received an order sealing the indictment. The Government never offered a reason for sealing the indictment. The five-year statute of limitations would have expired on August 29, 2018.

On February 28, 2019, the Government obtained a two-count superseding indictment, relabeling the original charge as “Bankruptcy Fraud” and adding a second count for “Attempt to Evade and Defeat Payment of Tax” under 26 U.S.C. § 7201. Again, the Government moved to seal the indictment without providing any reasons, and the court agreed.

Boswell was arrested on March 20, 2019, and the indictments were unsealed that day. Boswell moved to dismiss Count 1 of the indictment based on a statute-of-limitations violation.

Legal Authority: A properly sealed indictment will toll the statute of limitations unless there is “substantive and actual prejudice.” See United States v. Sharpe, 995 F.2d 49, 50 (5th Cir. 1993). Here in Boswell, the court interpreted Sharpe “to hold that (1) an improperly sealed indictment does not toll the statute of limitations; and (2) even a properly sealed indictment will not toll the statute of limitations if the defendant can show substantive and actual prejudice.”

Holding: The Government identified no legitimate purpose for sealing the indictment, so the statute of limitations was not tolled.

In the district court, the Government explained the sealing this way: It had “identified potential co-conspirators that required further investigation and approval,” and “leaving the indictment unsealed would potentially alert the co-conspirators.” The Fifth Circuit rejected that and held that “the Government failed to establish a legitimate prosecutorial purpose for sealing the indictment.”

In fact, the “most troubling aspect of the Government’s action in this case is that, despite its burden to ‘explain and support the legitimacy of its reasons for sealing the indictment,’ the Government has undertaken very little effort to support with evidence that its justifications are in fact legitimate.” Sharpe, 995 F.2d at 52.

The Government claimed a need to keep alleged co-conspirators in the dark, but each of them actually “testified in front of the grand jury in connection with the Government’s investigation of Boswell.” Moreover, the Government “provided no evidentiary support for its proffered justifications.” As the court explained, “where the Government has so obviously failed to provide justification for sealing the indictment, we cannot sanction the sealing as proper.”

Given that the Government failed to identify a legitimate prosecutorial purpose for sealing the indictment, Boswell had no burden to prove that he was prejudiced by the sealing, and the court reversed his conviction on Count 1.