The Nebraska Supreme Court held that trial courts may not automatically dismiss civil lawsuits where a person bringing a suit invokes the Fifth Amendment privilege against self-incrimination and refuses to answer some questions. The decision was handed down December 30, 2010. A copy of the decision may be seen here.
The Court ordered that the trial court must allow a case against an Omaha lawyer to proceed. Bryan Behrens, a former insurance salesman, was convicted of securities fraud in connection with his failure to pay persons who invested money with him in exchange for promises in high interest rates and return of their principal investment. The federal Securities Exchange Commission took Behrens' assets away from him and a receiver was appointed. The Receiver, suing in Behrens' name, seeks to recover money for investor victims.
"The Receiver controls Mr. Behrens' assets, including his rights to file suits against others" Dave Domina said. Domina, representing the SEC Receiver, argued that dismissal of the suit because Mr. Behrens could not, or would not, answer questions until after his criminal case was over, would only hurt victims. "Mr. Behrens will not get any money from this case if it is successful on remand", Domina said. Instead, any recovery will go to the receivership for the victims.
The Supreme Court said that in this case, and future cases, courts must balance the importance of the Fifith Amendment against the impact of its use on the civil suit and rights of other litigants before deciding whether to let a civil suit proceed. "Now, Mr. Behrens criminal case is over and he should be able to answer the other side's questions," Domina said. "This should allow the case to develop normally, now."
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