For affirmance -- Chief Justice Hughes, Justices Mountain, Sullivan, Pashman, Clifford and Schreiber and Judge Conford. For reversal -- None. The opinion of the court was delivered by Schreiber, J. Clifford, J. (concurring). Clifford, J., concurring in the result.
John J. Kenny was indicted by a State Grand Jury and convicted for extortion and misconduct as a Hudson County Freeholder arising out of his demanding and receiving the sum of $50,000 to modify some restrictions contained in a deed from Hudson County to the Reinauer Land Company. Upon appeal, the Appellate Division, one Judge dissenting, reversed. The State has appealed as of right. R. 2:2-1(a).
Kenny had previously testified in a federal criminal matter under the cloak of a federal immunity law, 18 U.S.C. § 2514. The Appellate Division held that that immunity deprived the State of its right to try Kenny and that the prosecutor's remarks in his opening and summation constituted reversible error. The primary issue before us concerns the effect of the federal immunity statute and we shall direct our attention to that question.
Briefly stated the pertinent facts are as follows:
In 1954 the Reinauer Land Company purchased some acreage in Secaucus from Hudson County. The deed contained numerous restrictions which limited the grantee's use of the property. Subsequent attempts to sell the land were frustrated because of the restrictions and efforts to have Hudson County remove the limitations failed.
In 1965 a contract for the sale of property was entered into with the Mackman Realty Corporation, subject to removal of the deed restrictions. Under the terms of the agreement, Reinauer Land Company had 6 months to effect elimination of the restrictions, and, if unsuccessful, then the Mackman Realty Corporation had one year within which to accomplish that result. The Land Company's efforts failed. The Realty Corporation took over. H. B. Mack, a principal of the Realty Corporation, advised Reinauer that it would cost $50,000 to obtain release of the restrictions from the County. This was the price Kenny, who was then a Hudson County Freeholder, had fixed. The Land Company and the Realty Company put up the money which was paid to Angelo Sarubbi who in turn delivered the money to Kenny. Thereupon the Board of Freeholders voted to eliminate the restricttions. A quitclaim deed was delivered to Reinauer Land Company on December 1, 1966 and the sale from Reinauer Land Company to Mackman Realty Corporation was consummated on December 30, 1966.
The foregoing facts led to Kenny's indictment by the State Grand Jury on September 15, 1970 for extortion (N.J.S.A. 2A:105-1) and misconduct in office (N.J.S.A. 2A:85-1).
Kenny and eleven others were indicted by a federal grand jury on November 15, 1970. The indictment contained some 34 counts. The gravamina of the federal counts were conspiracies to extort and bribe, and extortion in connection with public construction projects of Hudson County
and Jersey City. None of the matters involved the Reinauer transaction.
In the federal proceedings Kenny's trial was severed from that of the codefendants. During their trial he was granted transactional immunity in accordance with 18 U.S.C. § 2514 and testified on behalf of the government. Details of the direct and cross-examination and colloquy of the court and counsel are set forth in the Appellate Division opinion and need not be repeated. Suffice it to say that on cross-examination Kenny was asked and responded to a series of questions which covered the subject matter of the State indictment.*fn1
The majority of the Appellate Division in an opinion by Judge Bischoff found that Kenny's testimony before the federal court was compelled, contrary to the finding of the trial judge and the dissenting opinion. At the oral argument before this Court the State conceded that Kenny's testimony was compelled. Upon our own independent review of the evidence we have come to the same conclusion and essentially agree in this respect with the analysis in Judge Bischoff's opinion.
The State's contention is that the transactional immunity granted under 18 U.S.C. § 2514 applies only to that testimony adduced at the federal trial which is substantially related to the offense for which transactional immunity has been granted. A State prosecution for offenses related to that testimony would be impermissible. The witness would be entitled to use immunity for any other statements which
he had been compelled to make in the federal trial during his examination, whether on direct or cross-examination. Since the State had not used Kenny's testimony, or data obtained therefrom, it contends that the prosecution was not barred.
The ultimate question is the interpretation to be given to 18 U.S.C. § 2514. For that answer we must look to the act, legislative history and prior decisions.
Title 18 U.S.C. § 2514*fn2 reads as follows:
"Whenever in the judgment of a United States attorney the testimony of any witness, or the production of books, papers, or other evidence by any witness, in any case or proceeding before any grand jury or court of the United States involving any violation of this chapter or any of the offenses enumerated in section 2516, or any conspiracy to violate this chapter or any of the offenses enumerated in section 2516 is necessary to the public interest, such United States attorney, upon the approval of the Attorney General, shall make application to the court that the witness shall be instructed to testify or produce evidence subject to the provisions of this section, and upon order of the court such witness shall not be excused from testifying or from producing books, papers, or other evidence on the ground that the testimony or evidence required of him may tend to incriminate him or subject him to a penalty or forfeiture. No such witness shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter or thing concerning which he is compelled, after having claimed his privilege against self-incrimination, to testify or produce evidence, nor shall testimony so compelled be used as evidence in any criminal proceeding (except in a proceeding described in the next sentence) against him in any court. No witness shall be exempt under this section from prosecution for perjury or contempt committed while giving testimony or producing evidence under compulsion as provided in this section."
The statute prescribes four conditions precedent to an effective immunity grant: (1) the decision of the United States Attorney that the evidence is necessary in the public interest; (2) approval of that decision by the Attorney
General; (3) the desired evidence relates to a violation of sections 2514 or 2516 or conspiracies to violate such offenses; and (4) the court upon application of the United States Attorney orders the witness to testify.
Once the conditions precedent for the grant of the immunity have been satisfied, the witness shall not be prosecuted "on account of any transaction, matter or thing concerning which he is compelled . . . to testify . . . nor shall testimony so compelled be used as evidence in any criminal proceeding . . . against him in any court." (Emphasis supplied). The language is broad, and on its face the immunity would appear to be applicable to any transaction about which he was forced to testify.
Legislative history of 18 U.S.C. § 2514 throws no interpretative light on the statute.*fn3 However, some historical background is helpful.
In the process of that review it is essential to differentiate between a use and transactional immunity. The Fifth Amendment privilege against compulsory self-incrimination is that "[n]o person . . . shall be compelled in any criminal case to be a witness against himself". Immunization coextensive with that privilege contemplates that the compelled testimony and information derived directly or indirectly from that evidence shall not be used against the witness. That protection is commonly referred to as "use" immunity. Transactional immunity affords the witness protection from prosecution for or conviction of the offense related to the testimony. It is not limited to the use of the particular testimony or the fruits thereof.
The differentiation was pointedly made in Kastigar v. United States, 406 U.S. 441, 92 S. Ct. 1653, 32 L. Ed. 2d 212 ...