Third Circuit Rules Plaintiff Failed To Follow Pennsylvania Procedure For Petitioning Grand Jury Files - DD 12/03

Defense Digest

Third Circuit Rules Plaintiff Failed To Follow Pennsylvania Procedure For Petitioning Grand Jury Files

In Camiolo v. State Farm Fire & Cas. Co., et al., 334 F.3d 345 (3d. 2003), the United States Court of Appeals for the Third Circuit recently affirmed a lower court decision issued by the Honorable Harvey Bartle, III, granting summary judgment on behalf of all defendants arising out of a house fire in Upper Moreland Township which killed the plaintiff's parents and for which the plaintiff was incarcerated for ten months as the primary suspect in that house fire.  We represented Upper Moreland Township, former Chief of Police Edward Stauch, Upper Moreland Fire Marshall Tom Sullivan, and Detectives Rick Tidwell and Rick Kerrigan throughout discovery and argued on their behalf before the Third Circuit.

On September 30, 1996, the house where Paul Camiolo resided with his parents, Edward and Rosalie Camiolo, was damaged by fire.  According to Camiolo, the fire started in the living room sofa on which his mother was sleeping.  Although he escaped from the house without injury, his father died in the fire and his mother died several months later as a result of the injuries she sustained during the fire. 

State Farm insured the Camiolo residence against fire loss.  An entry in State Farm's claim activity log dated September 30, 1996, indicated that the cause of fire "was due to careless smoking" and that efforts would be made to obtain a copy of the Fire Marshall's report.  Yet, Upper Moreland Township police and fire officials, who initiated an investigation, suspected that Paul Camiolo had, by incendiary means, intentionally started the fire.  That investigation eventually led to a request by the District Attorney of Montgomery County that the Court of Common Pleas of that county convene an investigating grand jury pursuant to Pennsylvania's Investigating Grand Jury Act.  The District Attorney's request was granted, and a county investigating grand jury met to hear the evidence on ten separate occasions between August 13, 1998, and January 14, 1999. 

State Farm had also initiated an investigation into the cause and origin of the fire, hiring Walter Kerr to conduct an investigation and submit a report.  Kerr opined in March of 1997 that the "fire was intentionally set and accelerated by the use of gasoline."  Thereafter, State Farm refused to pay Camiolo's claim for losses caused by the fire.  In response, Camiolo filed suit in November, 1997, alleging that State Farm had breached its contract of insurance.  State Farm subsequently removed the suit to the United States District Court for the Eastern District of Pennsylvania. 

In late September, 1998, while the grand jury was still conducting its criminal investigation, State Farm initiated discussions with Camiolo's counsel, which eventually led to settlement of the initial civil suit seeking payment of the fire loss claim. Camiolo signed a release on October 15, 1998, in exchange for $240,000. 

In mid-January, 1999, the County investigating grand jury returned a presentment concluding that Camiolo was responsible for the arson homicide of his parents.  The 23-page presentment described in detail the responding police officer's observations at the scene, including her conversations with Camiolo and her discovery of an unattended Rosalie Camiolo lying several feet back from the door of the house.  Five pages of the presentment concerned Camiolo's "contradictory versions of the fire," statements made by Camiolo about his whereabouts at the time the fire the was discovered, his discovery of the fire, the cause of the fire, his alleged attempts to fight the fire, and his escape from the house.

Thirteen pages of the presentment discussed the forensic evidence, including laboratory testing of samples of hardwood flooring and other debris which revealed the presence of partially evaporated gasoline.  The presentment concluded that there was "probable cause to believe that the fire at 4130 Hoffman Road was set by Paul Camiolo through the use of one or more flammable liquids which he poured in the family room of the house and then ignited with an open flame."  The grand jury, through its presentment, recommended that the Montgomery County District Attorney charge Camiolo with various offenses, including the arson murder of his parents.  Camiolo, thereafter, was arrested and detained pending trial for approximately ten months.

In early October, 1999, John Lentini, an expert retained by Camiolo, submitted a report to Camiolo's counsel which indicated that the laboratory samples of hardwood flooring contained gasoline and lead.  He explained that lead was not a natural component of wood finishing, but that it had been a natural component of gasoline prior to the early 1980's.  As a result, Lentini opined that the gasoline in the samples was old, and that it had not been used to set the fire.  After considering Lentini's report and confirming his methodology, and taking into account the results of further tests on fabric similar to that on the furniture in the Camiolo house, together with the fact that State Farm had settled Camiolo's insurance claim, the District Attorney dismissed the charges against Camiolo and he was released from custody in late October, 1999. 

In July, 2000, Camiolo filed a civil suit alleging RICO violations against State Farm, as well as the Upper Moreland Township police and fire officials involved in the investigation.  The complaint further alleged a §1983 claim that these same defendants violated Camiolo's constitutional rights and were liable for false arrest, false imprisonment, and a list of other state law claims. 

On March 18, 2001, the District Court, in an Order and Memorandum issued by Judge Harvey Bartle, III, granted summary judgment for State Farm on the basis of the release that Camiolo had executed in settling the underlying breach of insurance contract claim.  During the course of discovery against the remaining defendants, of which we represented Upper Moreland Township and police and fire officials, a dispute arose over access to the grand jury testimony, which had eventually handed down the indictment and had recommended the arrest of Paul Camiolo for the arson murder of his parents.  Counsel for Paul Camiolo had contacted Bruce Castor, the District  Attorney of Montgomery County, to obtain the transcripts.  District Attorney Castor informed Camiolo's attorney that, in light of Pennsylvania Rules of Civil Procedure, and "contrary to my initial inclination, I conclude that Pennsylvania law prohibits me from disclosing grand jury transcripts as a part of a civil case." 

When the District Attorney refused to voluntarily produce the investigating grand jury transcripts, Paul Camiolo applied to the District Court, one week before close of discovery, to compel their production, asserting that "at least one of the defendants has raised the grand jury indictment as a defense."  Camiolo asserted that permitting the disclosure would insure consistent and complete testimony by the witnesses since the grand jury testimony was given in 1998, three years prior to the commencement of this lawsuit.  In addition, he argued that disclosure would far outweigh any continued need of secrecy given the age of the grand jury.  It was Camiolo's contention that the disclosure was necessary to show that the grand jury indictment was obtained through fraud or other undue influences at work. 

The Upper Moreland Township defendants, along with the District Attorney's office for Montgomery County, opposed Camiolo's request for disclosure of the grand jury transcripts.  Judge Bartle denied Camiolo's motion without prejudice.

Thereafter, Camiolo again moved to compel production of the County investigating grand jury testimony by filing an identical motion to the one that had been denied.  This time, however, the District Attorney responded to Camiolo's motion by asserting that the supervising judge of the state grand jury was the custodian of the grand jury records, and that Camiolo would have to contact the supervising judge regarding his request for access to the County investigating grand jury testimony. 

In response to the duplicate motion to compel the production of the County and investigating grand jury testimony, a conference call was held with all counsel, including the District Attorney for Montgomery County, with Judge Bartle on this issue.  Judge Bartle instructed District Attorney Castor to produce the grand jury testimony for in camera review.  The transcripts of the grand jury were delivered to Judge Bartle's chambers for his review and determination on the various motions for summary judgment that had been filed by all the defendants in the matter. 

Thereafter, in an Order and Memorandum dated February 1, 2002, Judge Bartle granted the summary judgment for the remaining defendants on the RICO and §1983 claims. 

Paul Camiolo filed a timely appeal, challenging the District Court's order which denied his motion to compel the disclosure of the grand jury testimony. 

The Third Circuit Court of Appeals, in considering Camiolo's appeal, noted that Pennsylvania law is quite clear in that Pennsylvania's grand jury process is strictly regulated.  "In Pennsylvania, as in the federal system, grand jury proceedings have traditionally been conducted in secrecy."  Through the enactment of the Investigating Grand Jury Act, Pennsylvania's Legislature had endeavored to ensure the secrecy of the grand jury proceedings conducted in that state by limiting access to the transcripts of these proceedings. 

The appellate court noted that subject to certain limited exceptions, none of which applied in Camiolo's case, matters occurring before a county investigating grand jury may not be disclosed in the absence of an order from that grand jury's supervising judge.  Before a supervising judge may grant or deny any request for disclosure of certain matters occurring before a county investigating grand jury, that judge must be formally presented with an appropriate motion to permit such a determination and may require a hearing into the relevancy of the request. 

Paul Camiolo contended that he complied with these requirements by hand delivering a letter to Judge Subers' chambers, in which he included a copy of the motion he filed in federal court, and indicated that the federal district judge would like a reply within seven business days.  Nonetheless, Camiolo never presented an appropriate motion to Judge Subers and his courtesy copy of his federal motion did not sufficiently present the matter to Judge Subers for his review and determination.  The court noted that, indeed, in the absence of a motion filed with the state court, there was no reason for Judge Subers to weigh in on whether access should be granted to the transcripts from the county investigating grand jury.  In light of the secrecy afforded grand jury matters in Pennsylvania, and the respect owed by federal courts to Pennsylvania law, the appellate court noted it was not unreasonable for Judge Subers to presume that the district judge would refrain from ruling on the accessibility of the transcripts until Camiolo formally petitioned the state court for disclosure.  Camiolo failed to do so.

The Third Circuit Court of Appeals noted that, at a minimum, and out of respect and deference owned to state court, Judge Bartle should have abstained from addressing Camiolo's motion.  The court noted that principles of comity and federalism demand that a district court presented with a request to compel the disclosure of any matter occurring before a Pennsylvania investigating grand jury should direct the party to first formally petition the judicial officer who possesses the supervisory authority to grant or deny such access.  "Accordingly, a party seeking such state grand jury testimony should first present his request to the appropriate state judicial officer." 

The Third Circuit Court of Appeals noted that because Camiolo never presented a motion to request disclosure of the state grand jury materials to Judge Subers, the district court should have, at a minimum, abstained from ruling on the motion seeking to compel production of the state grand jury material until Camiolo complied with the dictates of Pennsylvania law.  The appellate court also noted that Judge Bartle erred in compelling the District Attorney to produce the grand jury transcript's for its own in camera review, and in considering whether the production of those documents was justified. 

Important, however, is that the Third Circuit ruled that the police officers had probable cause to arrest Camiolo, and that the facts and decisions made in arresting him were reasonable despite Camiolo's eventual release from prison and the charges against him being dropped.  The evidence that did arise during discovery indicated that various defendants differed as to the origin and cause of the fire, but this difference was not as a result of fraud or perjury.

Nonetheless, the court concluded that a remand of this case to the district court so that it may consider whether to afford Camiolo additional time to formally present the state court with a specific request for the materials that he sought was not warranted.  The Third Circuit concluded that any prejudice in this matter resulted solely from Camiolo's failure to follow both federal and state procedures and, therefore, the court declined to afford him another opportunity to correct his past mistakes. 

The effect of the Third Circuit Court of Appeals decision in this matter is that it sets forth in clear language the procedures that a party in federal court must comply with, consistent with Pennsylvania law, on gaining access to sealed grand jury proceedings.  The opinion also makes clear that, although in this particular case, the district court erred when it considered Camiolo's motion and obtained the grand jury proceedings for an in camera review, the opinion should not be read to preclude all district courts from considering "eleventh hour requests for extension of discovery to pursue state grand jury matters."  A district court may consider not only the nature of the evidence being sought by a party, but also the extent of the moving party's efforts to utilize ordinary discovery to obtain the desired evidence and the degree to which these efforts were unfruitful. 

*Joe, a shareholder, and Jim, an associate, both work in our Norristown, PA office.  Joe can be reached at (610) 292-4444 or jsantarone@mdwcg.com.  Jim can be reached at (610) 292-4441 or jcaponi@mdwcg.com.