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State v. Schlanger
Decided: May 6, 1985.
THE STATE OF NEW JERSEY,
SIDNEY SCHLANGER, ET AL., DEFENDANTS
This opinion supplements a letter opinion and addresses the "no civil use" provision of R. 3:9-2. It examines the considerations to be weighed in permitting a prior guilty plea to be used in pending civil litigation where the monetary aspect of the damages sought is of significant financial consequence. Cognate to this inquiry is the relationship between the concern of a defendant that such plea not be evidential in any subsequent civil proceeding and the desirability to conserve both judicial and prosecutorial resources through disposition of a criminal indictment by plea. The facts of this case are appropriate and timely for judicial consideration of this rule. No local precedent or rule annotation has expressed comment as to its application.
For a considerable period of time this Court has been engaged in the case management and disposition of a State Grand Jury Indictment alleging a substantial conspiracy to commit theft by deception from several insurance companies through an array of fraudulent contrivances. State v. Schlanger,
197 N.J. Super. 548 (Law Div.1984). See Note 1 of that text. Companion civil actions have been filed and are currently pending in the United States District Court pursuant to the Racketeer Influenced and Corrupt Organizations Act (RICO). 18 U.S.C. § 1961 et seq.*fn1 With its treble damage penalty RICO poses formidable financial exposure to certain of these defendants far exceeding the $1,000,000 they acquired as the object of the conspiracy. Hence they strongly urge this Court to exercise its discretion in their favor and not permit their prior pleas of guilty to be used in the continuing civil litigation.*fn2
R. 3:9-2 in its pertinent part provides:
The only reported reference to this rule appears in Stone v. Keyport Bor. Police Dept., 191 N.J. Super. 554, 558 (App.Div.1983), wherein Judge Brody said:
The purpose of the rule is to avoid an unnecessary criminal trial of a defendant who fears that a civil claimant will later use his plea of guilty as a devastating admission of civil liability.
Though this statement is expressive of the purpose of the rule, it did not attempt to construe the phrase "for good cause
shown" nor determine the moral measure appropriate to the relief sought.*fn3
As of this writing substantially all of the defendants have been sentenced to significant prison terms and fines. The rationale employed by the court for its sentence structure focused on deterrence, as well as protection of the public. These sentencing goals were employed to strongly dispel the common perception that white collar offenders are dealt with less harshly than those who commit other types of non-violent crime. Notwithstanding their individual participation in this massive conspiracy and the reasons expressed by the court for imposing their respective sentences, the defendants advance three basic arguments for "no civil use" of their prior pleas. Succinctly stated, they are as follows:
1. The civil plaintiffs are capable of prosecuting and establishing their monetary claims through the ...
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