UNITED STATES OF AMERICA
COMMODITY FUTURES TRADING COMMISSION
In the Matter of
MARK B. FISHER, et al.
CFTC Docket No. 93-2
ORDER DENYING INTERLOCUTORY REVIEW
Respondents Mark B. Fisher, Kenneth Carter and Frank Amodeo seek interlocutory review of the February 19, 1999 order of the Administrative Law Judge ("ALJ") denying their motions to reopen the hearing in this matter. Respondent Mark Singer also seeks review of the ALJ's order, though he filed no motion below.1 The Division of Enforcement ("Division") opposes the relief requested.2
Three rounds of oral hearings in this administrative enforcement proceeding concluded in November 1997. The post-hearing briefing period ended in November 1998, and the case is awaiting decision. The respondents seek to reopen the hearing at this time to admit the testimony of Vincent L. White, the former New York branch chief of the Division of Trading and Markets, who left the Commission's employ in January 1999.
The respondents are charged, inter alia, with noncompetitive trading at the New York futures exchanges during 1987-89, allegations that rest in part on the manner in which they resolved out-trades. The respondents argued before the ALJ, and now assert to the Commission, that Vincent White is prepared to testify that he witnessed similar behavior and that the CFTC did not object to this resolution of error trades. The respondents further assert that they did not become aware that Vincent White could provide potentially useful testimony until after he left the Commission.
In a one-page order refusing relief, the ALJ ruled that "[r]eopening the hearing is likely to present cumulative evidence," Order of Feb. 19, 1999, and that the respondents had failed to show that reasonable grounds existed for not attempting to present White's evidence at the time of the hearing. He said that White's former status as a Commission employee did not bar his being called as a witness for respondents.
Although a higher standard is required to subpoena Commission
under Rule 10.68(b), it does not appear that any of the petitioners sought to
[subpoena] Mr. White at the time. . . . Respondent Fisher listed current employees
as possible witnesses in its Prehearing Memorandum, and such a subpoena request
may have been granted.
The respondents' motions are not properly before
the Commission. Rule 10.101(a)(5) provides that an application for
interlocutory review generally must be preceded by the ALJ's
certification that "(i) a ruling sought to be appealed involves a
controlling question of law or policy, (ii) an immediate appeal may
materially advance the ultimate resolution of the issues in the
proceeding, and (iii) subsequent reversal of the ruling would cause
unnecessary delay or expense to the parties." Interlocutory review
from certain kinds of rulings may be sought without certification,
see Rule 10.101(a)(1)-(4), but none of those exceptions applies here.
The respondents erroneously attempt to rely on one of those exceptions,
Rule 10.101(a)(3), which allows applications for interlocutory relief
without certification from an ALJ's refusal to issue a subpoena to a
Commission employee. Accord, Rule 10.68(b)(4) (reiterating that
interlocutory review is available without certification). However, no
respondent ever requested a subpoena for White while he worked for the
Commission, rendering Rules 10.68 and 10.101(a)(3) irrelevant here.4
The respondents also cite Rule 10.107 as a ground for the relief they seek. That rule also does not apply in these circumstances. The rule, which states that at "[a]ny time prior to issuance of [its] final decision the Commission may . . . reopen the hearing for the reception of further evidence," applies only to appeals pending before the Commission. This matter is still before the ALJ. A motion under Rule 10.107 would be appropriate only when and if a respondent were to seek review of the initial decision.
In refusing to reopen the hearing, the ALJ acted under
Rule 10.69 (the trial level counterpart of rule 10.107), which allows any
party to petition the ALJ to reopen a hearing "to adduce additional
evidence at any time prior to issuance of the initial decision" upon
a showing that the evidence "is relevant and material and that there
were reasonable grounds for failure to adduce such evidence at the time
of the original hearing."
Whether the ALJ should have reopened the hearing is not before us--the question was not certified. The ALJ could not reasonably have certified that question because it facially does not meet the standard of Rule 10.101(a)(5). It is not a controlling issue of law or policy. Given the advanced stage of the proceedings before the ALJ, an immediate appeal will likely not materially advance the ultimate resolution of the case. Nor will a subsequent reversal of the ruling cause unnecessary delay or expense. The time and cost of reconvening a hearing that has been closed and transcribed to take additional testimony will not change materially if it occurs pursuant to a successful appeal instead of taking place now.
In the absence of a certified or certifiable question, the respondents' applications for interlocutory review are denied.
IT IS SO ORDERED.
By the Commission (Chairperson BORN and Commissioners HOLUM, SPEARS and NEWSOME).
Catherine D. Dixon
Assistant Secretary of the Commission
Commodity Futures Trading Commission
Dated: April 29, 1999
1 See untitled motion of Mark Fisher (filed Feb. 24, 1999); untitled motion of Mark Singer (filed Mar. 2, 1999); untitled motion of Kenneth L. Carter and Frank Amodeo (filed Mar. 2, 1999).
2 See Division of Enforcement's Opposition to respondent Fisher's motion (filed Mar. 3, 1999); Division of Enforcement's Opposition to motions of respondents Singer, Carter and Amodeo (filed Mar. 12, 1999). The Division's motion for an enlargement of time to file the latter opposition is granted.
3 All Commission Rules cited are codified at 17 C.F.R. Part 10.
4 Respondents urge that if they had timely known that White possessed relevant evidence, they would have tried to subpoena him before the hearings concluded. They contend that they could not ethically approach him while he was in the Commission's employ and thus they were not in a position to evaluate his usefulness as a witness. This contention is persuasively countered by the Division's credible response that one of Fisher's witnesses "testified to having had discussions with White regarding the operations of the NYMEX floor committee and its resolution of errors." Division Opposition at 5 (Mar. 3, 1999). See id. at 4, citing the hearing transcript. In addition, the Division argues, while Fisher's prehearing memorandum listed as potential witnesses "present and former CFTC employees who served on the floors of the NYMEX, COMEX and CSCE," he did not try to call any such persons. Id. at 5.