Petition for Writ of Certiorari — Natalio Fridman, Petitioner v. United States

Supreme Court briefMay 3, 2021

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No. 20In the

Supreme Court of the United States

NATALIO FRIDMAN,

Petitioner,

UNITED STATES OF AMERICA,

Respondent.

On Petition for Writ of Certiorari to the

United States Court of A ppeals for the Second Circuit

PETITION FOR A WRIT OF CERTIORARI

Richard A. Levine

Counsel of Record

Roberts & Holland LLP

1675 Broadway, 17th Floor

New York, New York 10019

(212) 903-8700

rlevine@rhtax.com

Attorneys for Petitioner

302539

(800) 274-3321 • (800) 359-6859

QUESTIONS PRESENTED

1. Does an individual retain his Fifth Amendment privilege in the face of the

“foregone conclusion doctrine” when an IRS summons requires him, in effect, to provide

testimony (akin to responses to interrogatories)?

2. Does an individual retain his Fifth Amendment privilege in the face of the

“collective entity doctrine” when an IRS summons issued to him in his personal capacity seeks

to compel production of documents of a corporation, but there is no evidence or no finding of

fact that he is a custodian of the corporate records?

3. Can the Government compel an individual who asserts his Fifth Amendment

privilege to disclose whether he is a custodian of records of a collective entity and then, in

reliance on that compelled disclosure, demand that he produce the entity’s records?

RELATED CASES

United States v. Fridman, No. 15-mc-64, U.S. District Court for the Southern District

of New York. Judgment entered on November 25, 2015, and on November 14, 2018.

United States v. Fridman, No. 15-3969-cv, U.S. Court of Appeals for the Second

Circuit. Judgment entered on December 13, 2016.

United States v. Fridman, No. 18-3530-cv, U.S. Court of Appeals for the Second

Circuit. Judgment entered on September 9, 2020.

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ............................................................................................................ i

RELATED CASES ......................................................................................................................... ii

TABLE OF APPENDICES ........................................................................................................... iv

TABLE OF AUTHORITIES ...........................................................................................................v

OPINIONS BELOW ........................................................................................................................1

JURISIDICTION .............................................................................................................................1

CONSTITUTIONAL PROVISION INVOLVED ...........................................................................1

STATEMENT OF THE CASE........................................................................................................1

Background and Procedural History ........................................................................2

The Fifth Amendment, the Act of Production Privilege, and the

“Foregone Conclusion” Doctrine .............................................................................5

The Fifth Amendment and the Collective Entity Doctrine ......................................7

REASONS FOR GRANTING THE PETITION .............................................................................9

The Second Circuit’s Decision Conflicts with this Court’s Opinions and

Ignores the Pure Testimonial Aspects of Compelled Compliance with

Document Requests #1, #2, #7, #13, #15, #16, #17, and #20 ................................10

The Second Circuit Erroneously Held that Petitioner Must Prove that

He is Not a Custodian of the Records of Seven Corporations, Despite

Absence of Any Finding of Fact, Evidence, or Allegation that He Was

the Custodian .........................................................................................................15

CONCLUSION ..............................................................................................................................19

iii

TABLE OF APPENDICES

APPENDIX A – OPINION OF THE UNITED STATES COURT OF APPEALS FOR

THE SECOND CIRCUIT, DATED SEPTEMBER 9, 2020

APPENDIX B – OPINION OF THE UNITED STATES DISTRICT COURT OF THE

SOUTHERN DISTRICT OF NEW YORK, DATED NOVEMBER 14, 2018

APPENDIX C – OPINION OF UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT, DATED DECEMBER 13, 2016

APPENDIX D – ORDER OF THE UNITED STATES DISTRICT COURT OF THE

SOUTHERN DISTRICT OF NEW YORK, DATED NOVEMBER 25, 2015

APPENDIX E – DENIAL OF REHEARING OF THE UNITED STATES COURT OF

APPEALS FOR THE SECOND CIRCUIT, DATED DECEMBER 4, 2020

TABLE OF AUTHORITIES

Page(s)

Cases:

Bellis v. United States,

417 U.S. 85 (1974) ...............................................................................................................8

Braswell v. United States,

487 U.S. 99 (1988) ..................................................................................................... passim

Curcio v. United States,

354 U.S. 118 (1957) .................................................................................................8, 13, 14

Fisher v. United States,

425 U.S. 391 (1976) ................................................................................................... passim

Hale v. Henkel,

201 U.S. 43 (1906) ...............................................................................................................8

Hiibel v. Sixth Judicial Dist. Ct. of Nev.,

542 U.S. 177 (2004) .............................................................................................................5

In re Grand Jury Subpoenas Duces Tecum Dated June 13, 1983 & June 22, 1983

(Saxon Industries),

722 F.2d 981 (2d Cir. 1983)...............................................................................................18

In re Katz,

623 F.2d 122 (2d Cir. 1980)...............................................................................................15

In re Sealed Case,

877 F.2d 83 (D.C. Cir. 1989) .......................................................................................16, 17

Mathis v. United States,

391 U.S. 1 (1968) .................................................................................................................5

SEC v. Forster,

147 F. Supp. 3d 223 (S.D.N.Y. 2015)................................................................................18

United States v. Doe,

191 F.3d 173 (2d Cir. 1999)...............................................................................................18

United States v. Doe,

465 U.S. 605 (1984) .............................................................................................................8

United States v. Hubbell,

167 F. 3d 552 (D.C. Cir. 1999), aff’d, 530 U.S. 27 (2000)........................................ passim

United States v. White,

322 U.S. 694 (1944) .............................................................................................................8

Wilson v. United States,

221 U.S. 361 (1911) .......................................................................................................8, 17

Statutes & Other Authorities:

U.S. Const. Amend. V ........................................................................................................... passim

28 U.S.C. § 1254(1) .........................................................................................................................1

OPINIONS BELOW

The opinion of the Court of Appeals is published at 974 F.3d 163 and is reproduced at

App. A. The District Court’s opinion is published at 337 F. Supp.3d 259 and is reproduced at

App. B. The order of the Court of Appeals denying Petitioner’s petition for rehearing en banc

is unpublished and is reproduced at App. E. An earlier opinion of the District Court in this

case is unpublished and is reproduced at App. D, and an earlier opinion of the Court of

Appeals, vacating and remanding the District Court’s earlier opinion, is available at 665 Fed.

Appx. 94 and is reproduced at App. C.

JURISIDICTION

The Court of Appeals issued its opinion on September 9, 2020. (App. A.) The Court of

Appeals denied Petitioner’s petition for rehearing en banc on December 4, 2020 (App. E.).

Pursuant to this Court’s order of March 19, 2020, regarding filing deadlines during the

COVID-19 pandemic, this petition is due 150 days after the date of the denial of Petitioner’s

petition for rehearing en banc. This Court has jurisdiction under 28 U.S.C. § 1254(1).

CONSTITUTIONAL PROVISION INVOLVED

The Fifth Amendment to the United States Constitution provides in relevant part that

“[n]o person ... shall be compelled in any criminal case to be a witness against himself.”

STATEMENT OF THE CASE

This case raises three important questions as to the scope of the Fifth Amendment

privilege: (i) whether the “foregone conclusion doctrine” applies where the compelled self-

incrimination is styled as a demand for documents, but is, in substance, testimonial; (ii)

whether an individual who is ordered to produce corporate documents in connection with an

investigation of his personal income tax returns must prove he is not a custodian of records of

the corporation, where the Government has not alleged, and no evidence has been introduced

or finding of fact made to the effect that, he is such a custodian; and (iii) whether an individual

can be compelled to disclose whether he is a custodian of records of a collective entity and

then, in reliance on such compelled disclosure, be compelled to produce the entity’s records

under the collective entity doctrine.

A. Background and Procedural History

On December 19, 2013, the IRS issued two summonses to Petitioner in connection with

an investigation into his personal income taxes for the year 2008. (CA JA 17-48.) One

summons states that it is issued to Petitioner in his individual capacity. The other summons

states that it is issued to Petitioner in his capacity as the Trustee of the David Marcelo Trust.1

The document requests attached to each of the summonses are identical (id.), and consist of 21

separately numbered paragraphs, only nine of which are at issue in this Petition.2 The

summonses requested that Petitioner appear for an interview and produce the documents listed

in the document request.

The summonses request that Petitioner (1) list the opening and closing date of all

foreign accounts over which he had signatory authority since 1999 (Request #1); (2) produce

2006 and 2007 bank records for all his foreign accounts (Request #2); (3) produce enumerated

bank documents relating to seven named corporations from “opening date to 1/31/2009”

Petitioner was a trustee of the trust. (CA JA 60.)

Document Requests ## 4, 5, 6, 8, 9, 10, 11, 12, 14, 18, 19, and 21 are no longer at issue.

All or a portion of the remaining document requests are at issue in this Petition.

(Request #3); (4) produce bank documents to show the flow of funds, the account numbers,

and the account holders’ names for several specifically identified transactions (Request #7);

and (5) produce various documents for “any Trust [other than the David Marcelo Trust] for

which Petitioner is a Trustee or Beneficiary” (Requests #13, #15, #16, #17, #20). (CA JA 2932.)

Petitioner appeared before the IRS in response to the summonses. He asserted his Fifth

Amendment privilege in response to oral questions and in response to the summonses’ demand

for documents. On March 11, 2015, the Government filed a petition in the District Court to

enforce the summonses. In support of its petition, the Government asserted that the documents

requested were relevant to show that Petitioner had failed to file income tax returns, had filed

false income tax returns, and had failed to report his income. (CA JA 51-63.) The Government

asserted that the “collective entity” doctrine and the “foregone conclusion” doctrine applied to

negate Petitioner’s Fifth Amendment privilege with respect to production of the documents

listed in the requests.

In response, Petitioner argued that a number of the requests were not requests for

documents, but rather were demands for testimony. He also argued that the neither the

“foregone conclusion” doctrine nor the “collective entity” doctrine applied to deny him the

protection of the Fifth Amendment privilege. In response to Petitioner’s contention that

Requests #1, #2, and # 7 are requests for testimony, the Government, with the District Court’s

approval, revised those requests. In place of Request #1, asking Petitioner to list opening and

closing dates of all foreign accounts over which he had signature authority since 1999,

Petitioner was required to produce existing documents to show the opening and closing dates

of those foreign accounts, on a list of 24 specific accounts, over which he had signatory

authority. Request #7, which requests Petitioner to produce bank documents to show the flow

funds, the account numbers, and the account holders’ names for several specific transactions,

was revised by the addition of the words “existing documents.” No changes were made to

Requests #2, which requests various bank documents, and to Requests #13, #15, #16, #17 and

#20, which demand that Petitioner produce documents relating to the David Marcelo Trust and

“any other trust for which [Petitioner] is a Trustee or a Beneficiary.”

The District Court held a hearing on November 17, 2015; the hearing was not recorded,

and no transcript was made. At the hearing, Petitioner objected that the revisions to the

summonses did not cure the compelled testimonial aspects inherent in the requested responses,

and asserted that he is protected from producing any documents by the Fifth Amendment.

Petitioner also objected to the compelled production of documents relating to seven different

corporations, on the grounds that the summonses were issued to Petitioner in his individual

capacity in connection with an IRS investigation of his personal income taxes; they were not

issued to any of the seven corporations nor to Petitioner as a custodian of any of the

corporations. At the conclusion of the hearing, the District Court ruled from the bench granting

the Government’s petition to enforce the summonses.

Petitioner appealed. On December 13, 2016, the Second Circuit vacated the District

Court’s order and remanded to case to the District Court, on the grounds that the record was

insufficiently developed to permit meaningful appellate review of the District Court’s

determination that the Fifth Amendment act of production privilege did not apply. (App. C.)

On remand, and without holding an additional hearing, the District Court again granted the

Government’s petition to enforce the summonses in an opinion dated November 14, 2018.

(App. B.)

Petitioner appealed the District Court’s decision on the grounds that compliance with

the document requests would require Petitioner to provide the Government with the equivalent

of oral testimony, and that the District Court erred in holding that the “collective entity”

doctrine and the “foregone conclusion” doctrine applied, because inter alia, the Government

failed to demonstrate any custodial relationship between Petitioner and any of the seven

corporations named in Request #3 at the time the summonses were issued.

On September 9, 2020, the Second Circuit affirmed the District Court’s decision. (App.

A.) Petitioner subsequently petitioned the Second Circuit for en banc review. The Second

Circuit denied his petition on December 4, 2020. (App. E.)

B. The Fifth Amendment, the Act of Production Privilege, and the “Foregone

Conclusion” Doctrine

The Fifth Amendment guarantees that “[n]o person . . . shall be compelled in any

criminal case to be a witness against himself.” U.S. Const. amend. V. The Fifth Amendment

privilege applies when a communication is testimonial, incriminating, and compelled. Hiibel v.

Sixth Judicial Dist. Ct. of Nev., 542 U.S. 177, 189 (2004). Fifth Amendment protection

applies in civil proceedings, such as those involving an IRS summons, where there is a credible

threat of criminal exposure. See Mathis v. United States, 391 U.S. 1 (1968). In this case, the

Government’s assertions that it needs, and seeks to compel the production of, the documents in

issue because it believes that Petitioner has failed to file income tax returns, has filed false

income tax returns, and has failed to report all his income raise such a credible threat. (CA JA

52-53.)3 The questions presented in this Petition relate to the application of the Fifth

Amendment privilege to the compelled production of documents.

3 CA JA refers to the joint appendix filed below. CA Dkt. 33-1 – 33-2.

In Fisher v. United States, 425 U.S. 391 (1976), this Court held that the Fifth

Amendment protects not only compelled oral testimony, but also the testimonial aspects

implicit in the compelled “act of production” of documents in response to an IRS summons.

The implicit testimonial aspects of such an “act of production” are that: “(i) documents

responsive to a given subpoena exist; (ii) they are in the possession or control of the

subpoenaed party; (iii) the documents provided in response to the subpoena are authentic; and

(iv) the responding party believes that the documents produced are those described in the

subpoena.” United States v. Hubbell, 167 F. 3d 552, 567-68 (D.C. Cir. 1999), aff’d, 530 U.S.

27 (2000). Accordingly, the Government can overcome Fifth Amendment protection only by

showing that, in light of information already in its possession, there are no implicit testimonial

facts not already known that would be disclosed by the act of producing the documents

demanded. See Fisher, 425 U.S. at 411-13.

On the particular facts in Fisher, this Court determined that there were no testimonial

aspects to production of the documents protected by the Fifth Amendment that were not

already known to the Government. Id. In describing this conclusion, the Court stated that

“[t]he existence and location of the papers are a foregone conclusion and the taxpayer adds

little or nothing to the sum total of the Government’s information by conceding that he in fact

has the papers.” 425 U.S. at 411. The Court in Fisher used the term “foregone conclusion” as

a way of stating that there were no meaningful admissions of fact implicit in compelling the

production of the documents requested by the summons, but these lower courts have

overlooked the Court’s focus in Fisher on the absence of testimonial aspects to the particular

document production in issue. Rather, at the behest of the Government, many lower courts

have mistakenly treated the term “foregone conclusion” as a separate test that permits the

Government to require the production of the documents based on information relating solely to

the existence and location of the documents.

In United States v. Hubbell, 530 U.S. 27 (2000), the only case in which this Court

considered applying Fisher’s “forgone conclusion” argument to a claim of Fifth Amendment

privilege, this Court rejected the Government’s effort to leap from the premise that the

existence and possession of business records by Hubbell, a businessman, is a “foregone

conclusion” to the conclusion this was sufficient to overcome the privilege that attached to the

testimonial aspects of document production. The Court held that a subpoena required Hubbell

to make use of the contents of his own mind to select documents responsive to the subpoena,

thereby compelling him to be a witness against himself in violation of Fifth Amendment

protection, and that such protection was effective whether or not the Government knew of the

existence of the requested documents. 530 U.S. at 43-44.

Similarly, in this case, an “act of production” in compliance with the document requests

at issue would compel Petitioner to make admissions of fact that may be used against him in

violation of his Fifth Amendment privilege, apart from “foregone conclusions” regarding the

existence, or his possession, of documents. The District Court and the Second Circuit, by

limiting their “foregone conclusion” analyses to whether the Government had shown

knowledge of the existence of the documents demanded and of their possession by Petitioner,

ignored the purely testimonial aspects, not “foregone conclusions” at all, of producing

documents in response to Requests 1, 2, 7, 13, 15, 16, 17, and 20.

C. The Fifth Amendment and the Collective Entity Doctrine

This Court has held for more than a century that the Fifth Amendment privilege is

available only to individuals, and not to legal entities such as corporations and partnerships.

See, e.g., Braswell v. United States, 487 U.S. 99 (1988); United States v. Doe, 465 U.S. 605

(1984); Curcio v. United States, 354 U.S. 118 (1957); United States v. White, 322 U.S. 694

(1944); Wilson v. United States, 221 U.S. 361 (1911); Hale v. Henkel, 201 U.S. 43 (1906).

This Court has also held that, just as a “collective entity” cannot assert the Fifth Amendment

privilege as a bar to production of the entity’s records, a “custodian” in possession of a

collective entity’s records may similarly not refuse to produce them. See Braswell, 487 U.S. at

104-05; Bellis v. United States, 417 U.S. 85 (1974). However, this “collective entity” doctrine

has never been applied by this Court – or so far as Petitioner is aware by any federal court – to

negate the Fifth Amendment privilege of an individual, absent a finding of fact or the

presentation of evidence to the effect that the individual was, at the time of the Government’s

demand for records, such a “custodian,” acting in a capacity such as employee, officer,

director, or shareholder of the corporation.

Here, Request #3 demands that Petitioner produce an extensive list of documents

pertaining to the banking relationships of seven corporations. The Government produced no

evidence that any document demanded by Request #3 existed at the time the summonses were

served, nor did it produce any evidence that Petitioner was in possession or control of any such

documents. Indeed, the Government made no effort to show that Petitioner was an officer,

director, employee, shareholder, or other “custodian” on behalf of any of the seven

corporations. The Government did not allege that Petitioner held any such position, it offered

to evidence to prove that he was, and neither the District Court nor the Second Circuit found as

a fact that Petitioner held any such position at any of the seven corporations. Nevertheless, and

notwithstanding that the summonses were issued to Petitioner in his individual capacity, in

connection with an IRS investigation of his personal income tax returns, and notwithstanding

that there was neither any allegation by the Government or finding of fact that Petitioner was

an officer, director, employee, or other custodian of any corporate records nor any evidence to

show that he was such a person, the Second Circuit erroneously applied the “collective entity”

doctrine to compel Petitioner to produce the documents demanded by Request #3.

REASONS FOR GRANTING THE PETITION

This case presents important questions concerning Fifth Amendment protection from

the compelled production of documents. This Court has allowed only limited exceptions to an

individual’s Fifth Amendment protection, in order to ensure that it is broad enough to prevent

compelled testimony implicit in production of documents. Although, in Fisher, the Court held

that the contents of documents voluntarily prepared are not protected by the Fifth Amendment

privilege, 425 U.S. at 408-11, and, in Braswell, the Court held that a custodian of corporate

records does not have a Fifth Amendment privilege with respect to the production of corporate

records, 487 U.S. 99, the act of producing documents still has implicit testimonial aspects that

are protected by the Fifth Amendment. The Second Circuit in this case has misapplied the

doctrines of both Fisher and Braswell in a way that significantly and improperly limits the

scope of Petitioner’s Fifth Amendment privilege.

Accordingly, Petitioner asks the Court to hold that the so-called “foregone conclusion

doctrine” cannot be used to compel an individual to provide specific factual information, even

when the compulsion is styled as a document request, instead of an order for oral testimony or

a written interrogatory. The Second Circuit here erroneously used that doctrine to deprive

Petitioner of his Fifth Amendment. The Second Circuit’s decision not only conflicts with this

Court’s opinions in Fisher and Hubbell, it sets a dangerous precedent obliterating Fifth

Amendment protection by allowing the Government to structure requests for factual

information as demands for documents.

Petitioner also asks the Court to make clear that an individual cannot be forced to prove

a negative -- that he was not a custodian of records of a collective entity – in order to assert

Fifth Amendment privilege against compelled production of documents relating to that entity.

In this case, there was no finding of fact, evidence, or even allegation by the Government that

Petitioner was a custodian of records of any of the seven corporations listed in the summonses,

and there was also no evidence or finding that any of corporate documents existed or that they

were in Petitioner’s possession or control. Nevertheless, the District Court held that Petitioner

must produce bank records of seven corporations, unless he proves that he is not a custodian of

their records. Imposition of such an obligation on Petitioner compels him to relinquish his

Fifth Amendment privilege and to testify regarding his relationship, vel non, to the

corporations, dramatically expanding the limited scope of the collective entity doctrine outlined

by this court in Braswell.

A. The Second Circuit’s Decision Conflicts with this Court’s Opinions and

Ignores the Pure Testimonial Aspects of Compelled Compliance with Document

Requests #1, #2, #7, #13, #15, #16, #17, and #20.

In Fisher, this Court established the principle that, although contents of existing

documents are not protected by Fifth Amendment privilege, the act of producing documents

“has communicative aspects of its own, wholly aside from the existence of the papers

demanded and their possession or control by the taxpayer.” 425 U.S. at 410. By complying

with a demand for documents, an individual “tacitly concedes the existence of the papers

demanded and their possession or control by the taxpayer … [as well as] the taxpayer’s belief

that the papers are those described in the subpoena.” Id. (emphasis added). This Court

recognized that compelled production of documents described in a summons is, in effect, a

compelled admission that the documents produced are the ones requested by the summons.

On the facts of Fisher, the Court held that compelled production of documents did not

result in implicit, compelled testimony from the taxpayer, who was the target of the IRS

investigation, because “the existence and location of the papers are a foregone conclusion and

the taxpayer adds little or nothing to the sum total of the Government’s information by

conceding that he in fact has the papers.” 425 U.S. at 411. In its use of the phrase “foregone

conclusion,” the Court did not create an exception to Fifth Amendment protection against selfincrimination. Rather, it merely described its conclusion that, in a particular set of

circumstances, there were no meaningful testimonial aspects to compelled production of

documents. Unfortunately, many courts, including the District Court and the Second Circuit

below, have misunderstood the phrase “foregone conclusion” and applied it in a manner that

focused only on whether the Government has shown that the requested documents exist and are

in the possession of Petitioner; such courts have ignored the testimony inherent in admitting

that the documents produced are the ones demanded.

In Hubbell, this Court rejected the Government’s effort to overcome the testimonial

aspects of document production by applying a “forgone conclusion” argument—namely, that

the existence and possession of business records by Hubbell, a businessman, is a “foregone

conclusion.” The Court ruled that, whether or not the Government knew of the existence and

location of the requested documents, Hubbell was protected by the Fifth Amendment, because

the subpoena required him to “make extensive use of the contents of his own mind in

identifying the… documents responsive to the requests in the subpoena.” Hubbell, 530 U.S. at

43 (internal quotation marks and citations omitted).

Here, the Second Circuit’s focus on whether the documents demanded exist and are

Petitioner’s possession ignored the fact that producing the documents is the equivalent of oral

testimony.4 Request #1, which originally demanded that Petitioner provide a list of dates and

identify accounts over which he had signatory authority, was modified to require Petitioner to

provide existing documents sufficient to show the opening and closing dates of all foreign bank

accounts listed on an exhibit “over which you have signatory authority since 1999“ (CA JA

29). Request #1, as modified, still requires Petitioner to specifically identify for the

Government foreign accounts over which he has signature authority, as well which accounts

may have been open or closed at the time the Summonses were issued.

Identifying for the Government all foreign accounts over which Petitioner has signature

authority is clearly the equivalent of oral testimony. Compelling Petitioner to provide

documents which show that same information is no different. The Second Circuit’s decision

to compel Petitioner to produce documents in response to Request #1 by applying the foregone

conclusion doctrine is contrary to Fisher and Hubbell.

The same issue of compelled testimony applies to Request #2, which demands

Petitioner produce records for “all your foreign accounts during 2006 and 2007.”

Request #7 also seeks to compel the equivalent of oral testimony from Petitioner. It

originally asked him to explain the flow of funds in five specified transactions, and was

modified to require him to produce bank documents that “show the flow of the funds” for those

transactions. (CA JA 30.) This request does not merely demand that Petitioner produce

customary bank records; it compels him to specifically identify for the Government documents

Petitioner below focused extensively on the testimony that the summonses seek to compel.

CA Dkt. 34 at 18-24, 45-47; CA Dkt. 68 at 13-16, 25-27.

that show how funds moved from one account to another. This amounts to the Government’s

compelling Petitioner to provide it with “a catalog of existing documents” that fit within the

document request to answer a specific question, which is prohibited by this Court’s precedent.

See Hubbell, 530 U.S. at 42.

Document Requests #13, #15, #16, #17 and #20 all require Petitioner to provide bank

records, trust agreements, books and records and certain correspondence for any trust [in

addition to the David Marcelo trust] for which Petitioner is a trustee or a beneficiary (CA JA

31-32), thus compelling Petitioner to disclose his connection to trusts, if any, heretofore

unknown to the Government. The Second Circuit’s ruling to compel Petitioner to provide

documents with regard to such trusts compels him to identify all trusts of which he is a trustee

or a beneficiary; this is the equivalent of testimony protected by Fifth Amendment privilege.

No reasonable application of the “foregone conclusion” doctrine or interpretation of the

Court’s opinions in Fisher or in Hubbell supports the Second Circuit’s ruling.

Nor does the “collective entity” doctrine apply to compel Petitioner to produce the

documents demanded and thereby to identify trusts of which he is a trustee or a beneficiary, but

which are unknown to the Government. A traditional trust may be a collective entity,5 and,

therefore, a trustee of a trust who is served with a summons to produce the trust’s documents,

as the custodian of the trust’s records, may be unable to assert his personal Fifth Amendment

“act of production” privilege with respect to producing the trust’s documents. See Braswell,

487 U.S. 99. However, the custodian retains his personal Fifth Amendment privilege with

respect to providing oral testimony. Curcio, 354 U.S. 118, 123-124.

Petitioner does not seek review of the Second Circuit’s ruling on this issue.

The summonses were served on Petitioner in his individual capacity and in his capacity

as trustee of the David Marcelo trust. Petitioner does not seek review of the demand for

documents of the David Marcelo Trust in Requests #13, #15, #16, #17 and #20. He seeks

review only with respect to documents of “any other trusts of which he is a trustee or a

beneficiary.” The first part of each request constitutes a demand for the disclosure of the

names of all trusts of which Petitioner is a trustee or a beneficiary, and the second part is the

compelled production of the documents themselves. The first disclosure is the equivalent of

compelled oral testimony protected by the Fifth Amendment, because the Government is not

aware of the identity of any other trusts of which Petitioner is a trustee or a beneficiary, and

Petitioner should not be compelled to provide that information.

In Braswell, the Court ruled that the act of production privilege set forth in Fisher and

Hubbell did not protect a custodian of corporate records from compelled production of the

corporation’s books and records. 487 U.S. 99. The Court, however, limited this holding in

Curcio, which protects a custodian of a collective entity’s records from compelled oral

testimony, as distinguished from testimony implicit in producing documents. Id. at 114-15. As

to the demand for the names of trusts of which Petitioner is a beneficiary, a beneficiary of a

trust is not a custodian of the trust’s records. Even if Petitioner is viewed as a custodian of

records for a trust of which he is a trustee, these requests seek to compel the equivalent of oral

testimony to identify such trusts, which is prohibited by the Court’s decision in Curcio.

This Court should grant review to ensure that document requests are not used to compel

the equivalent of oral testimony, thereby depriving individuals of the protection afforded by the

Fifth Amendment and affirmed by this Court’s decisions in Fisher, Hubbell, and Curcio.

B. The Second Circuit Erroneously Held that Petitioner Must Prove that He is

Not a Custodian of the Records of Seven Corporations, Despite Absence of Any

Finding of Fact, Evidence, or Allegation that He Was the Custodian.

Request #3 demands that Petitioner produce: “All bank statements and all account

opening documents, including but not limited to, Know Your Customer Account information,

including signature cards, opening deposit slips, passport copies, certificates of beneficial

ownership, letters of reference, certificates of clean funds and/or other source of funds

documentation for accounts held under the name of Consist Teleinformatica Argentine; Consist

Consultoria Systemast Repre; Wanstst Systemar DE Computacao CTDA; Consist France;

Consist Asia Pacific; Mak Data System; Consist International Inc. from opening date to

1/31/2009.” (CA JA 29.)

The Government proffered no evidence to show that any of the requested documents

existed on the date the summonses were issued, nor any evidence to show that Petitioner was in

possession or control of any of the documents. As a result, the “existence and the location of

the papers” is not a “foregone conclusion,” and their production may well add much ‘to the

sum total of the Government’s information,’” In re Katz, 623 F.2d 122,126 (2d Cir. 1980)

(citing Fisher, 425 U.S. at 411). The Government appears to have conceded that the foregone

conclusion doctrine did not apply to Request #3 (CA Dkt. 52 at 19), and neither the District

Court nor the Second Circuit held that the foregone conclusion applied to Request #3 to

deprive Petitioner of his Fifth Amendment privilege.6 However, the District Court and the

In its brief below, the Government also concedes that the forgone conclusion doctrine does

not apply to Requests #13 through #17 and #20, and instead relies only on the collective

entity doctrine to require compelled disclosure. (CA Dkt. 52 at 38, n.10.).”

Second Circuit erroneously held that the collective entity doctrine applied to deny Fifth

Amendment protection.

The summonses were issued to Petitioner in his individual capacity and in his capacity

as trustee of the David Marcelo Trust. Declarations introduced by the Government in support

of enforcement of the summonses make clear that the summonses were issued in connection

with an examination of Petitioner’s personal income tax liability for 2008, and not in

connection with an examination of the returns of any corporations of the records of which

Petitioner might be a custodian. (CA JA 55.) Indeed, no summons was issued to any of the

seven corporations, and none of those corporations was being examined by the IRS. (See id.)

The Government introduced no evidence to show that Petitioner was an officer, director, or

employee of any of the corporations at the time the summonses were issued, or at any prior

time, and neither the District Court nor the Second Circuit found that Petitioner held any of

those positions, or that he was otherwise a custodian of the records of any of the seven

corporations. Nevertheless, the Second Circuit required Petitioner to produce corporate

records under the collective entity doctrine, because “[w]e adopt the D.C. Circuit’s burdenshifting framework. See, e.g., In re Sealed Case, 877 F.2d 83, 87 (D.C. Cir. 1989). The

Government need only show a reasonable basis to believe a defendant has the ability to

produce records; once the Government has done so, the burden shifts to the defendant to

explain or justify refusal. See id.” (App. A at 36.)

The Second Circuit’s reliance on the D.C. Circuit’s opinion in In re Sealed Case is

misplaced and abandons the principle that the collective entity doctrine applies to an individual

served with a summons or subpoena only if the individual is shown to be a custodian of the

corporation’s records. The respondent in In re Sealed Case was served with a subpoena as

custodian of records of Corporation A. Based on that individual’s admission that he was the

president, chief executive officer, and major shareholder of Corporation A, the D.C. Circuit

held that he was a custodian, and the burden then shifted to him to prove that he could not

produce the records demanded. 877 F.2d at 87. In the present case, in contrast, Petitioner was

not served with a summons as custodian of records for any corporation, and there was no

showing of any kind that he was an officer, director, employee, or shareholder of any of the

corporations at or near the time the summonses were issued. To shift to Petitioner the burden

of showing that he was not a custodian of any of the corporations denies him Fifth Amendment

protection, by forcing him to relinquish his Fifth Amendment privilege in order to preserve that

privilege, in the absence of any evidence or even allegation introduced by the Government.

The long-established basis for denying an individual Fifth Amendment protection from

producing a corporation’s documents is that an individual who is an officer, or director, or

employee of the corporation, or was otherwise a custodian of its records, holds the documents

in a representative capacity or as an agent of the corporation. Since the corporation has no

Fifth Amendment privilege with respect to its records, neither does its agent. See Braswell v.

United States, 487 U.S. 99 (1988).7

The implicit testimonial aspects of compelled document production recognized in

Fisher protect Petitioner from having to produce any of the documents, unless Petitioner is a

custodian of the corporate records.8 The Second Circuit’s opinion ignores all applicable

precedents this Court and in the Courts of Appeals (including many of its own precedents),

Another rationale for denying Fifth Amendment protection to a custodian of corporate

records has been that the individual, by assuming the role of custodian, waived Fifth

Amendment protection. See Wilson v. United States, 221 U.S. 361 (1911).

The Second Circuit ruled that the foregone conclusion doctrine applies only to Requests #1,

#2, #4, and #7. (App. A at 29).

none of which applied the collective entity doctrine to an individual who was not an officer,

director, employee, or shareholder of the corporation. See, e.g., United States v. Doe, 191 F.3d

173 (2d Cir. 1999); In re Grand Jury Subpoenas Duces Tecum Dated June 13, 1983 & June 22,

1983 (Saxon Industries), 722 F.2d 981 (2d Cir. 1983); SEC v. Forster, 147 F. Supp. 3d 223

(S.D.N.Y. 2015).

With no legal precedent to support its holding, the Second Circuit takes words out of

context from a D.C. Circuit opinion whose facts in no way support the Second Circuit’s

decision. In in the absence of satisfying this Court’s Fisher test that the documents requested

exist and that they are in Petitioner’s possession at the time the summonses were served, the

Second Circuit simply ignores without any justification all legal precedents to deny petitioner

Fifth Amendment protection. Petitioner is not aware of any decided case by any federal court

that has applied the collective entity doctrine to deny Fifth Amendment protection in the

absence of any evidence that an individual is a custodian of the corporate records under such

facts.

The Second Circuit here improperly denied Petitioner his Fifth Amendment privilege

by forcing him to prove that he cannot produce the corporations’ records, even though there

was no showing, or even allegation, that he could or that he had an agency relationship with

any of the seven corporations at the time the summonses were issued. The Court should grant

the Petition in order to clarify the application of the Fifth Amendment in these circumstances.

CONCLUSION

For the foregoing reasons, the petition for a writ of certiorari should be granted.

Respectfully submitted,

Richard A. Levine

Counsel for Petitioner

Roberts & Holland LLP

1675 Broadway 17th Fl.

New York, NY 10019

(212) 903-8729

rlevine@rhtax.com

May 3, 2021

APPENDIX A

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page1 of 37

18-3530-cv

United States v. Fridman

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

____________________

August Term, 2019

(Argued: December 17, 2019

Decided: September 9, 2020)

Docket No. 18-3530-cv

____________________

United States of America,

Appellee,

Natalio Fridman,

Defendant-Appellant.

____________________

Before: POOLER, HALL, and LOHIER, Circuit Judges.

Appeal from the judgment of the United States District Court for the

Southern District of New York (Victor Marrero, J.) granting on remand the

Government’s petition to enforce two Internal Revenue Service summonses, one

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page2 of 37

sent to Fridman in his personal capacity and one sent to him in his capacity as a

trustee, based on the foregone conclusion and collective entity exceptions to the

Fifth Amendment’s self-incrimination clause. We agree with the district court

that the Government has shown with reasonable particularity the documents’

existence, Fridman’s control of the documents, and an independent means of

authenticating the documents such that the foregone conclusion doctrine applies.

We also agree with the district court that, as a matter of first impression in our

Circuit, a traditional trust is a collective entity subject to the collective entity

doctrine. Accordingly, we affirm the grant of the Government’s petition to

enforce the summonses.

Affirmed.

____________________

RICHARD A. LEVINE (Nancy Chassman, on the brief),

Roberts & Holland LLP, New York, NY, for DefendantAppellant.

TALIA KRAEMER, Assistant United States Attorney

(Rebecca S. Tinio, Assistant United States Attorney, on

the brief), for Audrey Strauss, Acting United States

Attorney for the Southern District of New York, New

York, NY, for Appellee.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page3 of 37

POOLER, Circuit Judge:

Natalio Fridman appeals from the judgment of the United States District

Court for the Southern District of New York (Victor Marrero, J.) granting on

remand the Government’s petition to enforce two Internal Revenue Service

(“IRS”) summonses, one sent to Fridman in his personal capacity and one sent to

him in his capacity as a trustee, based on the foregone conclusion and collective

entity exceptions to the Fifth Amendment’s self-incrimination clause. We agree

with the district court that the Government has shown with reasonable

particularity the documents’ existence, Fridman’s control of the documents, and

an independent means of authenticating the documents such that the foregone

conclusion doctrine applies. We also agree with the district court that, as a matter

of first impression in our Circuit, a traditional trust is a collective entity subject to

the collective entity doctrine. Accordingly, we affirm the grant of the

Government’s petition to enforce the summonses.

BACKGROUND

The IRS has long been investigating the use of offshore bank accounts to

improperly conceal federally taxable income. As part of these efforts, the IRS

sought to investigate Fridman for the 2008 tax year. While Fridman reported only

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page4 of 37

three foreign financial accounts maintained in a personal capacity for the 2008

tax year, the IRS became aware of at least five additional personal accounts: a

UBS account in Switzerland; a Credit Suisse account in Switzerland; a Bank

Leumi account in Switzerland; a Bank Leumi account in Israel; and a Bank Safra

account in Luxembourg (collectively, the “Personal Accounts”). The IRS learned

of these accounts in 2012 when Fridman’s representative provided the IRS with

these accounts’ statements or other bank records pertaining to the 2008 tax year.

From these documents, the IRS identified the account numbers and other

information related to the Personal Accounts.

Besides the Personal Accounts, the IRS became aware of seven companies

affiliated with or controlled by Fridman that maintained foreign bank accounts.

The IRS has identified seventeen such corporate foreign bank accounts

(collectively, the “Corporate Accounts”). 1 The IRS learned of these accounts

Four accounts relate to a company called Consist Teleinformatica Argentine;

two accounts relate to a company called Consist Consultoria Systemast Repre;

one account relates to a company called Wanstat Systemar DE Computacao

CTDA; two accounts relate to a company called Consist France; one account

relates to a company called Consist Asia Pacific; six accounts relate to a company

called Mak Data System; and one account relates to a company called Consist

International Inc.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page5 of 37

through Fridman’s filing of Foreign Bank and Financial Accounts (“FBARs”). A

person or entity is required to file an FBAR if they have “a financial interest in, or

signature or other authority over” a foreign financial account. 31 C.F.R. §

1010.350(a). In 1991, Fridman filed FBARs for the Consist Teleinformatica

Argentine, Consist Consultoria Systemast Repre, and Wanstat Systemar DE

Computacao CTDA accounts. In 1998, he filed FBARs for the Consist France and

the Consist Asia Pacific accounts. Fridman filed FBARs for one Mak Data System

account in 1998 and from 2000-2004, and for a second Mak Data System account

in 1998 and from 2000-2005. For four other Mak Data System accounts, he filed

FBARs in 2004 and 2005. For the Consist International Inc. account, Fridman filed

FBARs from 2000-2003.

Finally, the IRS learned that Fridman controls a number of trusts,

including at least one domestic trust that has a foreign financial account. This

trust is the David Marcelo Trust, named for Fridman’s son, of which Fridman is

both a trustee and beneficiary. Fridman’s sister is a second trustee, and

Fridman’s son is a second beneficiary. Though Fridman has not filed a tax return

for the David Marcelo Trust, the IRS learned that the David Marcelo Trust has an

HSBC account in Switzerland (the “HSBC Account”). The IRS came to know of

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page6 of 37

this account after Fridman’s representative provided some bank statements and

records related to the account in 2012 and 2013. One record shows a transfer of

$2.4 million from the HSBC Account into a domestic Citibank account belonging

to Fridman’s wife and son.

In 2013, the IRS issued the two summonses (“the Summonses”) that are

central to this case. One summons was sent to Fridman in his personal capacity,

and the other was sent to him in his capacity as Trustee of the David Marcelo

Trust. The documents sought (the “Requests”) were the same, and they largely

pertain to the Personal Accounts, Corporate Accounts, and HSBC Account

(collectively, the “Known Accounts”). The relevant Requests, as revised during

the proceeding below, are:

Request 1: For all of the foreign bank accounts listed on “Exhibit B”

[a list of 24 accounts] 2 over which you have signatory authority since

1999, please provide existing documents sufficient to show the

opening date and closing date of each.

Request 2: Please provide the 2006 and 2007 bank statements for all

your foreign bank accounts listed on “Exhibit B.”

Request 3: All bank statements and all the account opening

documents, including but not limited to, Know Your Customer

Exhibit B contains the name of the account holder, the bank, the country, and

the account number provided in redacted form.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page7 of 37

Account information including signature cards, opening deposit

slips, passport copies, certificates of beneficial ownership, letters of

reference, certificates of clean funds and/or other source of funds

documentation for accounts held under the name of Consist

Teleinformatica Argentine; Consist Consultoria Systemast Repre;

Wanstst Systemar DE Computacao CTDA; Consist France; Consist

Asia Pacific; Mak Data System; Consist International Inc. from

opening date to 1/31/2009.

Request 4: All bank statements and account opening documents,

including but not limited to, Know Your Customer Account

information including signature cards, opening deposit slips,

passport copies, certificates of beneficial ownership, letters of

reference, certificates of clean funds and/or other source of funds

documentation for the following accounts from opening date to

1/31/2009: UBS 29, Credit Suisse 3, Leumi Bank 49, Leumi Bank 02,

Safra 37, HSBC 15, Republic National Bank of New York (Suisse) S.A.

Request 7: Existing bank documents including but not limited to

cancelled checks, wire transfer instructions, wire transfer slips,

deposit slips that show the flow of the following funds, the account

numbers and account holders’ names for the Citibank accounts and

any other bank accounts, sufficient to show the flow of funds in five

transactions transferring funds between the HSBC account and an

unknown New York-based Citibank account on 7/26/2004, 8/30/2004,

9/28/2004, 1/31/2008, and 2/28/2010.

Request 11: Please refer to the Trust Agreement dated April 30th,

1990 – “the Grantor hereby transfers to the Trustees the property

described in the annexed Schedule A, which transfers the Trustees

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page8 of 37

hereby confirm.” See App’x at 81. Provide existing documents that

explain how the funds were transferred. For example:

a. Provide existing documents to show whether Fridman was

added to the existing account as trustee.

b. Provide existing documents relating to a redacted request

concerning the transfer of funds.

Provide existing documents sufficient to show the transfer of

property described in Schedule A of the Trust Agreement.

Request 12: All bank records for HSBC Private Bank (Suisse) SA

[redacted account number] from 1999 to 2002.

Request 13: All bank records for any account held under the name of

any trust for which Fridman is a Trustee or Beneficiary since the

inception of such trusts.

Request 14: In reference to first clause of Trust Agreement dated

04/30/1990, the Trust Agreement states “The Grantor wishes to record

that she intends by this Trust Agreement to create two separate trusts

. . .” See App’x at 81.

a. Please provide existing documents that show the name of the

trusts and all bank records for any account holding assets from

the inception of the trusts.

Request 15: Trust Agreement for any Trust for which Fridman is a

Trustee or Beneficiary.

Request 16: All books and records for the Trusts referenced in Clause

1 of the Trust Agreement dated 04/30/1990 and any other Trusts for

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page9 of 37

which Fridman is a Trustee or Beneficiary, including but not limited

to David Marcelo Trust.

Request 17: All records pertaining to property in which David

Marcelo Trust and/or any other trust have an interest.

Request 20: All correspondence between Fridman and any other

trustees, trustors, beneficiaries, and any other persons involved with

the trust(s) for which Fridman is a Trustee or Beneficiary related to

such a trust, its property and/or its administration.

Fridman asserted his Fifth Amendment privilege and refused to

produce the requested documents. On March 11, 2015, the Government

filed a petition to enforce the summonses. United States v. Fridman, 337 F.

Supp. 3d 259, 262 (S.D.N.Y. 2018). On November 25, 2015, the district court

granted the petition on the grounds that the documents were relevant and

certain exceptions to the Fifth Amendment act-of-production privilege

applied. Id. Fridman appealed, and a panel of this Circuit vacated and

remanded by summary order. United States v. Fridman, 665 F. App’x 94, 94

(2d Cir. 2016). While we affirmed the determination on relevance, we

remanded on the Fifth Amendment issue because the record was

insufficiently developed. Id. at 96-97. In a footnote, we directed the district

court to look to an intervening decision from our Circuit, United States v.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page10 of 37

Greenfield, 831 F.3d 106 (2d Cir. 2016), with respect to its analysis of the

foregone conclusion doctrine. Fridman, 665 F. App’x at 96 n.1.

On remand, the district court again granted the petition. Fridman,

337 F. Supp. 3d at 264. The district court applied the foregone conclusion

doctrine to Requests 1, 2 (limited to the Known Accounts only), 4, and 7.

Id. at 268-71. Because the Government “has provided the name of the

account holder, the bank, the country, and the account number for each of

the Known Accounts,” the district court was satisfied that the Government

knew of the existence, location, and authenticity of the requested

documents, as required by Greenfield. Id. at 268-71. The district court also

held that so-called “traditional trusts” were collective entities for purposes

of the collective entity rule, and therefore that Requests 1-4, 7, 11-17, and

20 were excepted as to all trust-related documents. Id. at 270-72. The

district court applied the collective entity rule to Request 3 as well because

the entities listed are collective. Id. at 272-74. Rejecting Fridman’s argument

that the Summonses were not served on him in his capacity as

representative for any of those entities, the district court reasoned that

“[r]egardless of the capacity in which Fridman was served, the result is the

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page11 of 37

same: [he] is required to produce documents responsive to Document

Request No. 3 to the extent he possesses such documents in his individual

capacity or his capacity as the custodian of a collective entity, including the

corporations listed in the Document Request.” Id. at 273.

Fridman timely appealed.

DISCUSSION

“We review de novo the District Court’s determination of questions of law

as to the Fifth Amendment privilege. But [we] will overturn the District Court’s

determination as to whether the act of producing the documents would involve

testimonial self-incrimination only where such a finding has no support in the

record.” Greenfield, 831 F.3d at 114 (internal quotation marks and citations

omitted).

The Fifth Amendment provides that no person shall be compelled in a

criminal case to be a witness against himself. U.S. Const. amend. V. In Fisher v.

United States, 425 U.S. 391, 409-11 (1976), the Supreme Court defined the contours

of the Fifth Amendment as it applies to document requests. The Court held that

documents voluntarily prepared prior to the issuance of a summons were not

compelled testimony, so there was no Fifth Amendment protection for the

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page12 of 37

contents of these records. Id. at 410-11. At the same time, however, the Court

recognized a narrow privilege against the act of production. Because producing

documents “tacitly concedes the existence of the papers demanded and their

possession or control by the taxpayer . . . [as well as] the taxpayer’s belief that the

papers are those described in the subpoena,” the Court concluded that the act of

production could, in some cases, communicate incriminatory statements and

thus may fall under the Fifth Amendment’s protection against self-incrimination;

but the Court hinted that such a determination would be conditioned on the

“facts and circumstances of particular cases.” Id. at 410-11. Similarly, when a

defendant must “make extensive use of the contents of his own mind in

identifying the hundreds of documents responsive to the requests in the

subpoena,” he or she contributes to a “link in the chain” of their prosecution in

violation of the Fifth Amendment privilege. United States v. Hubbell, 530 U.S. 27,

42-43 (2000) (internal quotation marks and citations omitted).

The act-of-production privilege is not an absolute one. Fridman challenges

the district court’s ruling that two exceptions to the act-of-production privilege

permitted enforcement of the requests at issue in this case.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page13 of 37

The Foregone Conclusion Doctrine

Under one exception, when “[t]he existence and location of the papers are

a foregone conclusion and the taxpayer adds little or nothing to the sum total of

the Government’s information by conceding that he in fact has the papers,”

production does not run afoul of the Fifth Amendment. Fisher, 425 U.S. at 411.

This principle has been aptly called the foregone conclusion doctrine.

As referenced above, our Circuit most recently addressed the foregone

conclusion doctrine in United States v. Greenfield, 831 F.3d 106, 110 (2d Cir. 2016).

There too, we dealt with a summons related to tax evasion. Id. at 110. In

Greenfield, we explained that for the foregone conclusion exception to apply, the

Government must establish “with reasonable particularity” its knowledge as to

“(1) existence of the documents, (2) the taxpayer’s possession or control of the

documents and (3) the authenticity of the documents.” Id. at 115; see also id. at

119. 3

We acknowledged that “both our court and our sister circuits have struggled

with the extent of Government knowledge necessary for a foregone-conclusion

rationale to apply.” Greenfield, 831 F.3d at 116. Indeed, in Greenfield, we wrestled

with enunciating the requisite level of knowledge of each specific responsive

document covered by the Summons. On the other hand, the Government must

know, and not merely infer, that the sought documents exist, that they are under

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page14 of 37

To meet the existence requirement, the “Government is not required to

have actual knowledge of the existence and location of each and every

responsive document.” Id. at 116. When a summons seeks “customary account

documents related to financial accounts that [the Government] knew existed,”

the documents’ existence is a foregone conclusion. Id. at 118.

Although we did not explicitly define “control” in the context of the

foregone conclusion doctrine in Greenfield, we start from the premise that a

taxpayer’s “possession or control of the [requested] documents” is one of the

“communicative elements” protected by the Fifth Amendment. Id. at 115

(emphasis added); see also Fisher, 425 U.S. at 409-11. The Government may

therefore satisfy the control requirement by establishing its knowledge of the

physical possession of the requested documents by the subpoenaed individual,

see Fisher, 425 U.S. at 411-12, or the subpoenaed individual’s control over the

requested documents, see Greenfield, 831 F.3d at 119 (explaining that an

the control of defendant, and that they are authentic.” Id. (citation omitted). The

“sweet spot” for the Government’s level of knowledge is somewhere between

“perfect knowledge” and a “mere inference.” Determining whether the foregone

conclusion doctrine applies requires a fact-intensive, case-by-case analysis. Id. at

119-28.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page15 of 37

individual’s ability or authority to receive the requested documents is an

essential part of being able to control the documents); id. at 199 n.10 (“[B]oth a

general power of attorney and the power to give instructions would suffice to

provide [the individual] with control over [the requested] documents.”); see also

Matter of Marc Rich & Co., A.G., 707 F.2d 663, 667 (2d Cir. 1983) (“The test for the

production of documents is control, not location); Control, Black’s Law Dictionary

(11th ed. 2019) (defining “control” as “[t]o exercise power or influence over”).

Thus, if the Government can prove it knows that an individual controls the

disposition of assets in an account, it follows that that individual controls the

requested documents associated with that account—given the Government has

satisfied the existence requirement.

With respect to the authenticity requirement, documents may be

“implicitly” authenticated if an individual complies with a summons demanding

production of documents, and the Government establishes that “th[ose]

documents are in fact what they purport to be” and “the taxpayer [was] not . . .

forced to use his discretion in selecting . . . the responsive documents.” Greenfield,

831 F.3d at 118 (internal quotation marks and citation omitted). Additionally, the

Government can “independently establish[]” authenticity in several ways: “a)

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page16 of 37

through the testimony of third parties familiar with that type of document, b) by

comparison to a prior version of the document, or c) by comparison to other

related documents.” Id. (citations omitted).

There is a critical temporal requirement as well. The Government must

prove its knowledge at the time the summons was issued. Id. at 119. “Relevant”

to this inquiry is whether “the Government can demonstrate that the documents

ever existed.” Id. at 119. “[I]n many circumstances, the Government’s ability to

establish existence and control as of an earlier date does permit an inference of

existence and control as of the date of the Summons.” Id. at 125 (emphasis

added). When considering whether such an inference of continued existence and

control is available, 4 we have borrowed and applied a balancing test from the

Eighth Circuit that examines: “(1) the nature of the documents, (2) the nature of

the business to which the documents pertained, (3) the absence of any indication

that the documents were transferred to someone else or were destroyed, and (4)

the relatively short time period . . . between the date as of which possession was

We stress that this inference of continued existence and control is different than

the “inference” forbidden in Greenfield. The inference allowed in Greenfield is one

of continued existence and control, not of knowledge itself.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page17 of 37

shown and the date of the ensuing IRS summons.” 5 Id. at 125-26 (internal

quotation marks and citation omitted).

Greenfield provides a bifurcated approach to the foregone conclusion

analysis when the “inference” of continued existence and control is at play. First,

we examine “whether the Government can establish the existence, control, and

authenticity of each category of sought documents” at some point prior to the

issuance of the summons. Id. at 119. For those documents for which the

Government’s evidence suffices, we then examine “whether it is a foregone

conclusion that these documents remained in [the individual’s] control through

the issuance of the Summons . . . . Only if that retention is a foregone conclusion

will the issuance of the Summons not violate [the] Fifth Amendment privilege.”

Id. at 123. 6

In this case, Fridman challenges the district court’s determination that the

foregone conclusion doctrine allows enforcement of Requests 1, 2, 4, and 7. He

We read “possession” here as synonymous with “control” in the context of the

foregone conclusion doctrine analysis.

6 We note that the Government does not need to prove authentication at an

earlier date so long as it can authenticate the documents as of the issuance of the

summons.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page18 of 37

makes two primary arguments. First, he claims that the district court misapplied

our decision in Greenfield. Second, he asserts that enforcing these Requests would

require him to provide testimonial information because the Government has

failed to establish its knowledge of the relevant documents with reasonable

particularity. We are not persuaded by either argument.

1. Existence

There is no doubt that the Government knows that the Known Accounts

existed prior to the issuance of the Summonses. Exhibit B, which lists the Known

Accounts, specifies the account holder, account number, the bank, and the

location (by country) for each account. Based on filings from Fridman or his

representative, the Government also knows the following about the listed

accounts: (1) the Personal Accounts existed in 2008; (2) the HSBC Account existed

in the years 2003-2010; (3) the Consist Consultoria Systemast Repre Corporate

Accounts and Wanstat Systemar Corporate Account existed in 1991; (4) the

Consist France Corporate Accounts existed in 1998; (5) the Consist Asia Pacific

Corporate Account existed in 1998; and (6) two of the Mak Data System

Corporate Accounts existed in 1998 and in the years 2000-2004 while four others

existed in 2004 and 2005.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page19 of 37

Requests 1, 2, 4, and 7 seek “customary account documents” from the

Known Accounts: (1) records sufficient to show the opening and closing dates of

the Known Accounts (listed in Exhibit B)7; (2) bank statements for the Known

Accounts for 2006 and 2007; (3) bank statements and account opening documents

for certain Personal Accounts and the HSBC Account, from the account opening

date through to January 31, 2009; and (4) bank records for transactions that the

Government knows occurred between the HSBC Account and an unknown

Citibank account. These requested documents—bank statements, account

opening documents, transaction records, and account closing documents—are all

quintessential customary account documents. Because of this, and because these

documents pertain to “financial accounts that [the Government] knew existed,”

their existence is a foregone conclusion. Greenfield, 831 F.3d at 118.

Fridman offers a number of unavailing counterarguments. First, Fridman

argues that the Government has not proven that it knows the specific requested

documents existed. But it was not required to do so. Greenfield makes clear that

The Government no longer seeks records under the foregone conclusion

doctrine for the four Argentina-based Corporate Accounts. Moreover, although

not a foreign account, the Government also does not seek records under the

foregone conclusion doctrine for the U.S. Citibank account.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page20 of 37

even if “the Government does not have specific knowledge of every document

that is responsive to the Summons, such specific knowledge exceeds what is

required under a ‘reasonable particularity’ standard.” Id. at 119. And when

dealing with customary account documents, proof of the account’s existence is

sufficient to show knowledge of the account documents with a reasonable

particularity. Id. Therefore, because the Government knows of the accounts’

existence, it has met its burden.

Fridman’s argument has the most traction with respect to Requests 1 and

2. As to the account closing documents sought in Request 1, it is true that the

Government does not know for certain that any of the Known Accounts, other

than the HSBC Account, have been closed. And unlike account opening

documents, which must necessarily exist for all the Known Accounts, account

closing documents will only exist for those accounts that have been closed.

Therefore, it is not as obvious whether knowledge of closing documents can be

predicated on knowledge of the accounts’ existence. Similarly, although Request

2 seeks bank documents for 2006 and 2007, the Government does not know for a

fact that the Personal or Corporate Accounts existed in those years; the IRS has

documents showing the Personal Accounts existed in 2008, and it knows the

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page21 of 37

FBAR filings for the relevant Corporate Accounts were made at various points

from 1991 to 2005.

But the Government does not need specific knowledge that the accounts

had been closed or that the accounts existed in 2006 and 2007. Such a

requirement does not square with our decision in Greenfield. In Greenfield, the

summons called for, inter alia, all documents in Greenfield’s possession for a

certain account. Id. at 112-13. There, we held that the Government had

sufficiently proven its knowledge of the existence of those documents because of

its knowledge of the account’s existence in 2001 and because the documents

sought were customary account documents. Id. at 119. It was no matter that the

category of documents sought—“all documents in [Greenfield’s] possession”

pertaining to the account—was sweeping and significantly broader than

Requests 1 and 2 here. See id. at 113. Thus, even though the Government in this

case does not have “specific knowledge of every document that is responsive to

the Summons,” such a heightened standard is not required under our

“reasonable particularity” standard, nor does it align with our analysis in

Greenfield. Id.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page22 of 37

Fridman also contends that the Government does not have specific

knowledge of the facts contained in the documents soughtBut in arguing that the

Government must know of the facts contained in the documents, Fridman

conflates the documents’ contents with their existence. The distinction is a

consequential one: the contents of documents are not covered by the Fifth

Amendment privilege. Fisher, 425 U.S. at 409-10. Therefore, the Government need

not prove its knowledge of the documents’ contents. Further, In re Katz, 623 F.2d

122, 126 (2d Cir. 1980), is not to the contrary. In In re Katz, the Government

sought “all documents relating to any dealings or business with . . . any company

owned, operated or controlled” by an individual named Benjamin Jamil. Id. at

123. We denied enforcement of the subpoena as written because the Government

did not know the identity of the corporations, Jamil’s relationship with them, or

whether some documents may be protected by attorney-client privilege. Id. at

126-27. We remanded to the district court to either conduct in camera review or

limit enforcement of the subpoena to public documents related to known entities.

Id. But here, the Government knows the accounts whose records are sought and

their connection to Fridman.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page23 of 37

Because the Government knew the accounts existed and requested only

customary account documents, we conclude that there is sufficient evidence in

the record to support the Government’s knowledge as to the documents’

existence for Requests 1, 2, 4, and 7.

2. Prior Control

The record establishes that Fridman’s representative provided account

statements or other bank records to the IRS in 2012 for the Personal and HSBC

Accounts. Moreover, Fridman held the Personal Accounts individually in his

name, and the HSBC Account was held in the name of the David Marcelo Trust,

for which Fridman serves as Trustee. This is sufficient to establish the

Government knew Fridman had control over the Personal and HSBC Accounts.

See id. at 119-20.

With respect to the relevant Corporate Accounts, Fridman made FBAR

filings at various points from 1991 to 2005. An individual must file an FBAR if he

has “a financial interest in, or signature or other authority over” a foreign

financial account. 31 C.F.R. § 1010.350(a). By filing FBARs for the Corporate

Accounts, Fridman indicated that he had control over those accounts’ records as

of the years of those corresponding filings. See id. § 1010.350(a), (e)-(f).

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page24 of 37

Although Fridman argues that certain requested documents would be in

the possession of offshore banks, not the account owner, this argument is

inapposite. We first note that the Government was not required to establish that

Fridman possessed the documents; rather, it was required to prove possession or

control of the documents. See Fisher, 425 U.S. at 410; see also Greenfield, 831 F.3d at

119-21 . Moreover, we have previously explained that “[t]he test for the

production of documents is control, not location.” Matter of March Rich & Co.,

A.G., 7070 F.2d at 667 (holding that a witness cannot resist the production of

documents on the ground that the documents are located abroad).

Because Fridman or his representative filed FBARs and copies of

documents pertaining to the Known Accounts, there is sufficient evidence in the

record to establish the Government’s knowledge of Fridman’s control over the

requested documents.

3. Inference of Continued Existence and Control

Having concluded that the Government has met its burden of showing

that the documents existed and were in Fridman’s control at one point, we now

turn to the question of existence and control at the time the Summonses were

issued in 2013. See Greenfield, 831 F.3d at 123. In doing so, we are permitted to

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page25 of 37

infer existence and control if the four factors from the Greenfield balancing test

weigh in favor of such an inference. Id. at 125-26.

After considering these factors, we conclude that the record permits an

inference of continued existence and control in the present case. The first three

factors support an inference of continued existence and control. First, as we

explained in Greenfield, “bank documents are more likely to be retained long term

as compared to documents like receipts or prosaic emails.” Id. Second, banks

“tend to maintain consumer records.” Id. Third, unlike in Greenfield, here there is

no “significant intervening event[] that might well have resulted in transfer or

destructions of the sought documents.” Id. Although Fridman suggests that the

absence of continued FBAR filings for the Corporate Accounts indicates that he

ceased having an interest in those accounts, we are not convinced. This absence

could be a product of Fridman’s failure to make requisite filings consistently. 8

His suggestion that he lost control of his Corporate Accounts during certain

years is just that—a suggestion. It does not amount to evidence of intervening

factors like those encountered in Greenfield. Id. at 126-27.

The record supports that Fridman failed to consistently file FBARs for other

foreign accounts.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page26 of 37

The final factor is less clear-cut. We have little difficulty agreeing with the

Government that the time period between the last date of possession for the

Personal and HSBC Accounts and the date of the Summonses was relatively

short. Fridman’s representative provided the IRS with documents relating to the

Personal Accounts in May 2012. The same representative last provided the IRS

with records relating to the HSBC Account in November 2012. Thus, only

nineteen and thirteen months, respectively, eslaped between this evidence of

control and the date of the Summonses (December 2013). Both lengths of time are

relatively short. See United States v. Rylander, 460 U.S. 752, 761 n.3 (1983)

(concluding that an “inference of continuing possession” over twenty-one

months was reasonable).

The same cannot be said for the Corporate Accounts. The last known date

of control for some of these accounts was more than a decade before the issuance

of the Summonses. The most recent last-known date of control was 2005,

approximately eight years prior to the Summonses’ date. This factor is not

dispositive, however, for we weigh all four factors in determining if an inference

of existence and control is acceptable. The Summonses seek “customary account

documents,” the requested documents are related to financial accounts, and

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page27 of 37

there is no evidence suggesting that the documents were transferred or

destroyed. 9 Here, while the time lapse for the Corporate Accounts is significant,

considering all the factors together, the inference is still applicable.

4. Authentication

We are also satisfied that the Government could independently

authenticate the documents it seeks without relying on Fridman’s act of

production. It could do so through the testimony of third parties familiar with

records, by comparisons to other bank records it already possesses, or by

comparisons to similar bank documents. Greenfield, 831 F.3d at 118. For the

Personal and HSBC Accounts, the Government possesses copies of statements

and other account documents that Fridman’s representative produced to it, and

the Government can use those as comparators for authentication purposes.

Although Greenfield did not reach the issue of whether such comparisons can

sufficiently authenticate documents, we so hold here.

We note that Fridman is a sophisticated businessman who is likely to retain

corporate records. Additionally, multinational banks tend to hold onto records of

their accounts, even those accounts that have been closed. A former client of a

bank is still entitled to seek records of a closed account (i.e., he has control over

them). For these reasons, we put less weight on the fourth factor of the balancing

test in this situation.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page28 of 37

As to the relevant Corporate Accounts, the Government argues that it can

use bilateral tax treaties to authenticate the documents. It points to a declaration

from an IRS employee noting that through certain treaties, the United States can

request authenticated records from Switzerland, Israel, Brazil, France, Spain, the

Philippines, and Germany—countries where the relevant Corporate Accounts

are located. Through those treaties, the Government may also obtain sworn

testimony or statements of authentication from bank officials to authenticate

bank records. 10 In our view, these tax treaties provide the Government with a

sufficient independent method of authentication.

Although in Greenfield we said that authentication through use of the

Hague Evidence Convention was insufficient, we emphasized that this was “in

light of the controversy surrounding the source of the documents” and the

Government’s failure to provide anything beyond “a conclusory statement” that

authentication was likely to occur. 831 F.3d at 120. Because whether treaties can

be used to authenticate documents depends on the facts and circumstances of a

This second method of authentication is not available for accounts located in

Switzerland and France, per those countries’ respective treaties with the United

States.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page29 of 37

particular case, and because the record before us presents neither the unusual

circumstances existing in Greenfield nor any other indication that the bilateral tax

treaties to be used here are too complicated or ineffective to permit

authentication, we conclude that the Government has sufficiently established

that it can authenticate the Corporate Account documents.

In sum, we are satisfied that the Government has met its burden of

proving knowledge of the existence of the documents, knowledge of Fridman’s

control over the documents, and an independent means of authenticating of the

documents as required by Greenfield. Therefore, the district court’s decision that

the foregone conclusion doctrine applies to Requests 1, 2, 4, and 7 for documents

relating to the relevant Known Accounts is affirmed.

II.

The Collective Entity Doctrine

Because the Fifth Amendment privilege protects only natural persons,

collective entities such as corporations or partnerships may not invoke it to

evade document requests. See, e.g., Braswell v. United States, 487 U.S. 99, 102, 104-

08 (1988); Bellis v. United States, 417 U.S. 85, 88-89, 93-101 (1974). Nor may an

individual custodian holding a collective entity’s records in a representative

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page30 of 37

capacity refuse to produce documents. Braswell, 487 U.S. at 108-12; In re Grand

Jury Subpoena Issued June 18, 2009, 593 F.3d 155, 158 (2d Cir. 2010).

“The critical issue [for determining what is a collective entity] is whether

the organization had an institutional identity separate from that of its individual

members.” In re Two Grand Jury Subpoenae Duces Tecum Dated Aug. 21, 1985, 793

F.2d 69, 72 (2d Cir. 1986); see also Bellis, 417 U.S. at 94-95. Pursuant to this rule, we

have held that sole proprietorships are covered by the Fifth Amendment’s

privilege against compulsory self-incrimination, because “a sole proprietorship

has no legal existence apart from its owner.” United States v. Fox, 721 F.2d 32, 36

(2d Cir. 1983); see also Braswell, 487 U.S. at 104. We have been strict in limiting the

privilege to only sole proprietorships and even holding that one-person

corporations are collective entities. In re Grand Jury Subpoena Issued June 18, 2009,

593 F.3d at 158-59. Our conclusion was motivated in part by the desire to

“avoid[] creating a category of organizations effectively immune from regulation

by virtue of being beyond the reach of the Government’s subpoena power.” Id. at

159.

Fridman first challenges the district court’s holding that trusts are

collective entities and that Fridman is therefore required to produce all trust30

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page31 of 37

related documents contemplated by Requests 1-4, 7, 11-17, and 20. Fridman also

challenges the district court’s conclusion that he is required to produce

documents responsive to Request 3 that he possesses in his capacity as custodian

of certain collective entities.

A. The collective entity rule applies to trusts, including traditional

common law trusts, like the David Marcelo Trust.

Whether a trust is a collective entity for purposes of the Fifth Amendment

is an issue of first impression for our Circuit. Every other circuit to address the

issue has answered in the affirmative. See In re Grand Jury Subpoena, 973 F.2d 45,

48 (1st Cir. 1992); Watson v. Comm’r of Internal Revenue, 690 F.2d 429, 431 (5th Cir.

1982); United States v. Harrison, 653 F.2d 359, 361-62 (8th Cir. 1981); In re Grand

Jury Proceedings, 633 F.2d 754, 757 (9th Cir. 1980). Our sister circuits have focused

on facts like the circumscribed discretionary authority of trustees, formal status

of the trust, and that a defendant may not be the sole beneficiary, In re Grand Jury

Subpoena, 973 F.2d at 48-51; that trusts are artificial entities, Watson, 690 F.2d at

431; that a trust is formally organized and legally distinct from the trustees,

Harrison, 653 F.2d at 361-62; and that a trust has independent functions even

when it is grantor-controlled, In re Grand Jury Proceedings, 633 F.2d at 757.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page32 of 37

We join these circuits and hold that a trust is a collective entity. We

conclude so for a number of reasons. Notably, a trust, including a traditional

common law trust like the David Marcelo trust, 11 has a separate legal existence

from the trustee, which is the critical hallmark of a collective entity. See Aug. 21,

1985, 793 F.2d at 72; see also Harrison, 653 F.2d at 361-62; In re Grand Jury

Proceedings, 633 F.2d at 757. Unlike a sole proprietorship, which cannot survive

without the owner or creator, when a trustee resigns or is removed, the trust may

still continue under New York law. Cf. 106 N.Y. Jur. 2d Trusts §§ 294, 298, 303.

This could not be so if the trust and trustee were one and the same.

In addition, a trust “represent[s] a formal institutional arrangement.” Cf.

Bellis, 417 U.S. at 95. A trust is “relatively well organized and structured,” much

like the other collective entities previously recognized by Supreme Court

precedent on the collective entity exception. See id. at 92-93; see also Braswell, 487

U.S. at 104-12 (detailing the collective entity rule’s “lengthy and distinguished

Traditional common law trusts are those that “create[] fiduciary relationships

for purposes of estate planning” and “cannot sue or be sued in [their] own right,”

in accordance with the common law of trusts. Raymond Loubier Irrevocable Tr. v.

Loubier, 858 F.3d 719, 729 (2d Cir. 2017); see also Restatement (Second) of Trusts §§

177 cmt. a (1959) (summarizing a trustee’s duty to enforce and defend against

claims on behalf of the trust).

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page33 of 37

pedigree”). One example is that a trustee’s discretion is limited by the governing

document and the principle that a trustee must act in the beneficiaries’ best

interest. See 106 N.Y. Jur. 2d Trusts §§ 347, 360; see also In re Grand Jury Subpoena,

973 F.2d at 48-50. This clearly distinguishes a trust from an entity that “embodies

little more than [a] personal [venture].” See Bellis, 417 U.S. at 94-95. Another

example is that a trust’s records are “distinct from the personal books and

records of” the trustee. Id. at 93; 106 N.Y. Jur. 2d Trusts § 373.

Finally, our holding that trusts are collective entities recognizes that the

decision to create a trust “is freely made and generates benefits, such as limited

liability, and burdens, such as the need to respond to subpoenas” for records. See

In re Grand Jury Subpoena Issued June 18, 2009, 593 F.3d at 159. As the Eighth

Circuit has said, “those who form a separate business entity [and] hold that

entity out as distinct and apart from the individuals involved . . . are estopped

from denying the existence and viability of that entity for Fifth Amendment

purposes.” Harrison, 653 F.2d at 361-62. We agree that it would be inequitable to

allow individuals to create a separate entity like a trust for favorable treatment

while simultaneously denying that entity’s separate existence for subpoena

purposes.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page34 of 37

Fridman’s arguments to the contrary are meritless. He first argues that

because a trustee can be held personally liable, a trust is more akin to a sole

proprietorship. Although a trustee is personally liable “in the first instance”

when acting on behalf of the trust, the trustee may be “entitled to be reimbursed

or indemnified . . . from [trust] assets.” 106 N.Y. Jur. 2d Trusts § 356. Fridman

next argues that because a trust cannot take legal action on its own behalf, and

because recent case law establishes that a trustee’s individual citizenship governs

jurisdiction in diversity suits, a trust and trustee are one and the same. See

Americold Realty Tr. v. ConAgra Foods, Inc., 136 S. Ct. 1012, 1016 (2016); Raymond

Loubier Irrevocable Tr. v. Loubier, 858 F.3d 719, 731 (2d Cir. 2017). But that “state

and federal law do not treat [trusts] as distinct entities for all purposes” does not

alter the conclusion that a trust is a collective entity because trusts “bear enough

of the indicia of legal entities to be treated as such for the purpose of our analysis

of the Fifth Amendment issue presented in this case” for the reasons discussed.

See Bellis, 417 U.S. at 97 n.7.

We hold that trusts, including a traditional common law trust like the

David Marcelo Trust, are collective entities for purposes of the Fifth Amendment.

As such, we affirm the district court’s grant of the petition to enforce the

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page35 of 37

Summonses with respect to any documents Fridman retains in his capacity as a

trustee in response to Requests 1-4, 7, 11-17, and 20. 12

B. Fridman must also produce responsive corporate documents he

retains in a representative capacity.

Fridman also challenges the district court’s ruling that if he possesses or

controls records of any of the entities listed in Request 3 in a representative

capacity, he must produce these records under the collective entity doctrine.

The parties seem to dispute whether, with respect to Request 4, the district

court limited its enforcement order solely to records of the Known Accounts. If

the district court had in fact limited its order in such a manner, then Fridman

need not produce records relating to the Republic National Bank of New York

account belonging to the David Marcelo Trust. Our review indicates, however,

that the district court ordered Fridman to produce “all trust-related documents

contemplated by Document Request Nos. 1-4, 7, 10-17, and 20,” which by its

terms covers the Republic National Bank of New York documents. See Fridman,

337 F. Supp. 3d at 272. The district court limited enforcement of Request 4 to the

Known Accounts only with respect to its analysis under the foregone conclusion

doctrine.

Additionally, Fridman has abandoned any other challenge to the scope of

the district court’s order to produce all trust-related documents that he possesses

in a representative capacity by failing to raise any such argument on appeal and

conceding that—at least with respect to Requests 13, 15, 17, and 20—the order

encompasses documents held in connection with known and unknown trusts

other than the David Marcelo Trust.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page36 of 37

Fridman argues that it is the Government’s burden to prove a custodial

relationship exists between him and the corporations.

While our Circuit has not articulated a specific framework for establishing

a custodial relationship, we adopt the D.C. Circuit’s burden-shifting framework.

See, e.g., In re Sealed Case, 877 F.2d 83, 87 (D.C. Cir. 1989). The Government need

only show a reasonable basis to believe a defendant has the ability to produce

records; once the Government has done so, the burden shifts to the defendant to

explain or justify refusal. See id.

In the case at hand, the Government has established Fridman’s control

over the records for the Corporate Accounts, as we discussed in our analysis of

the foregone conclusion doctrine. This control provides a reasonable basis for

believing that Fridman has the ability to produce these records, and the burden

has thus shifted to Fridman to prove otherwise. See id.

Fridman fails to meet his burden. He cites to two cases from our Circuit, In

re Grand Jury Subpoenas Duces Tecum Dated June 13, 1983 & June 22, 1983, 722 F.2d

981, 986-87 (2d Cir. 1983), and In re Three Grand Jury Subpoenas Duces Tecum Dated

January 29, 1999, 191 F.3d 173, 181 (2d Cir. 1999), for the proposition that former

employees possess records only in an individual, not representative, capacity.

Case 18-3530, Document 89-1, 09/09/2020, 2926155, Page37 of 37

But Fridman’s reliance is misplaced. It is clear that former employees could not

serve in a custodial capacity and therefore would hold records only in a personal

capacity. See In re Three Grand Jury Subpoenas Duces Tecum Dated January 29, 1999,

191 F.3d at 181. However, Fridman has not shown that he is no longer affiliated

with any of the corporate entities at issue here. Therefore, these cases are

inapposite.

We accordingly affirm the district court’s ruling that Fridman must

produce the corporate documents he holds in a representative capacity.

CONCLUSION

For the reasons given above, we affirm the district court’s grant of the

petition to enforce the Summonses.

APPENDIX B

Case

1:15-mc-00064-VM

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Document

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Page1

Page

of 134

of 34

USOC Sll\TY

DOCP!\IENT

ELECTRONIC ALl. y FILED

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

if I

~ II'

?flf'[b

DOC #:

DAH !!LED:

------------- --------------------X

UNITED STATES OF AMERICA,

15 Misc. 64

Petitioner,

DECISION AND ORDER

- against NATALIO FRIDMAN,

Respondent.

----X

VICTOR MARRERO, United States District Judge.

I . BACKGROUND

On March

11,

America

("Petitioner"

petition

summonses

Fridman

enforce

(the

Petitioner

2015,

two

the

United

States

"United

States")

filed

Internal

"Summonses")

("Respondent"

the

Revenue

against

or "Fridman") .

Service

("IRS")

Respondent

Natalia

(See

"Petition,"

Dkt.

No. 1.) The Summonses request various records and documents

(the "Document Requests"), and were issued in connection with

an IRS investigation into Fridman's tax liabilities for the

tax year 2008. One of the Summonses was issued against Fridman

in his individual capacity, and the other was issued against

Fridman in his capacity as trustee of the David Marcelo Trust.

On November 25,

2015,

the Court granted the Petition.

(9ee "November 25 Order," Dkt. No. 28.) The Court determined

that

(1)

Amendment

Respondent's

blanket

privilege

against

invocation

the

Fifth

self-incrimination

was

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of 234

of 34

insufficient to establish his entitlement to that protection;

(2)

even if Respondent's invocation of the Fifth Amendment

had been sufficient, Respondent would have been required to

produce the documents requested by the Summonses because of

certain exceptions to the Fifth Amendment act of-production

privilege; and (3) the United States satisfied its burden and

demonstrated

that

Summonses.

See

Respondent

custody,

id.

was

"produce

entitled

The

3-4.)

all

enforcement

Court

documents

therefore

or control that are responsive

his

the

ordered

possession,

to the Summonses'

document requests" and to "appear for an interview .

. to

provide testimony identifying and/or authenticating documents

produced by Respondent in his capacity as a representative of

a trust."

(Id. at 4.)

Fridman appealed, and on December 13, 2016, the Court of

Appeals for the Second Circuit issued a summary order vacating

and remanding the November 25 Order.

See "Appellate Order,"

Dkt. No. 33.) While the Second Circuit found that the Court

did not err in determining that the United States satisfied

its burden of showing the relevance of the requested documents

(see id. at 3), the appellate court concluded that the record

was

insufficiently developed for

determination

regarding

the

it to review the Court's

applicability

the

fth

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of 334

of 34

Amendment act-of production privilege

(see

Second Circuit directed the Court to "(1)

sufficient

Fridman

for

appellate

properly

determining

invoked

his

Fifth

Amendment

(2)

privilege;

and

exceptions

act

identify

production

4} .

The

provide a record

review

production

the

id.

any

privilege

whether

act

applicable

for

each

document request and determine the period of time for which

the exception applies."

On April

28,

(Id. at 5.)

2017,

Fridman

filed

objecting to enforcement of the Summonses.

brief

remand

(See "Respondent

Brief," Dkt. No. 3 9.} He asserts his Fifth Amendment privilege

as the basis for his objection to the Document Requests that

remain open, namely, Document Request Nos. 1 4, 7 17, and 20.

(See id. at 2,

Fifth Amendment

8.)

Fridman argues that no exception to the

act of-production

privilege

i.e.,

the

required records doctrine, the foregone conclusion doctrine,

and

the

collective

Document Requests,

entity

doctrine

applies

these

thus meaning that he cannot be compelled

to produce the documents.

See id.

at 8 20.}

Additionally,

Fridman argues that he does not possess or have control of

documents responsive to Document Request Nos.

and

10. (See id. at 21-23.) Finally, Fridman argues that in camera

review of responsive documents, as contemplated by the Second

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of 434

of 34

Circuit, would be inappropriate and unnecessary.

(See id. at

24-25.)

On June 23,

2017,

the United States filed a brief on

remand in support of its petition to enforce the Summonses

and requesting oral argument.

{See "Petitioner Brief," Dkt.

No. 42.) Petitioner asserts that Respondent has conceded that

the required records exception applies to certain Document

Requests, and that Fridman has produced documents responsive

to Document Request

Nos.

exception.

at 7 n. 5.)

(See id.

and

that

fall

within that

Petitioner argues that the

Fifth Amendment act-of production privilege does not protect

Fridman from producing documents and providing testimony in

response to the other Document Requests because one or both

of the other exceptions

and/or

the

foregone

the collective entity doctrine

conclusion

requests.

See id.

at 7-24.)

Petitioner

filed

the

doctrine

apply

the

In support of its arguments,

declarations

Theresa

Alvarez 1

Ms. Alvarez is an IRS Revenue Agent who is conducting an investigation

concerning Fridman's tax liabilities for the tax year 2008. (See Dkt. No.

43 ~ 2.) Ms. Alvarez explains that the IRS knew at the ti~e the IRS

issued the Summonses -- of the existence of a number of accounts at

various banks that Fridman controlled.

See id. ~~ 6-9.)

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("Alvarez Declaration," Dkt. No. 43), Tina B. Masuda 2

(Dkt.

No. 44), and John M. Gillies 3 (Dkt. No. 45)

On July 28,

2017, Respondent filed a reply memorandum.

("Respondent Reply," Dkt. No. 51.) In addition to reasserting

his

Fifth Amendment

privilege

against

self- incrimination,

Respondent argues that the United States cannot expand the

scope of the Summonses to cover documents held by Respondent

as custodian of any corporation or as trustee of any trust

other than the David Marcelo Trust.

(See id.

August 18,

sur-reply memorandum.

2017,

Petitioner filed a

{"Petitioner Sur-Reply," Dkt.

counters Respondent's

No.

objections

53.)

at 1-3.)

Petitioner not only

relating

the

foregone

conclusion doctrine and the collective entity doctrine, but

also argues that the scope of the Summonses is not limited by

the capacity in which Fridman was served.

(See id. at 1 5.)

On September 25, 2018, the United States sent the Court

a letter informing it of a recent decision in another case in

this district mc-213

United States v. Glaister

regarding

enforcement

IRS

et al., No. 18summonses.

(See

Ms. Masuda is an IRS Exchange of Information Program Manager. (See Dkt.

No. 44 ~ 1.) Ms. Masuda's declaration explains the various methods used

by the United States to authenticate bank records from foreign countries.

(See id. ~~ 3-40.)

3 Mr.

Gillies is an Associate Director with the Office of International

Affairs in the Criminal Division of the U.S. Department of Justice. (See

Dkt. No. 45 ~ l.) Mr. Gillies's declaration explains how the United States

can authenticate documents under the Mutual Legal Assistance Treaty

between the United States and Argentina. (

id. ,~ 8 12.)

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"September 25

Letter,"

Dkt.

No.

56.}

On October 3,

Fridman responded to the September 25 Letter,

2018,

arguing that

Glaister is inapposite to the present case because it involved

"business entities,"

not

"domestic

Marcelo Trust at issue in this case.

trusts"

the David

(See "October 3 Letter,fl

Dkt. No. 59.) On October 15, 2018, the United States responded

to the October 3 Letter, arguing that the collective entity

doctrine does not distinguish between domestic and business

trusts.

(See "October 15 Letter," Dkt. No. 61.}

The Court previously determined that the United States

has made a sufficient showing that the documents sought by

the Summonses are relevant to the IRS investigation:

The Government satisfied its burden under United States

Powel_!_, 379 U.S. 48 {1964), by demonstrating that it

is entitled to enforcement of its Summonses with regard

to its document requests as modified and/or clarified

and with regard to testimony

identifying

and/or authenticating documents produced by Respondent

in his capacity as a representative of a trust.

"'!_·

(November 25 Order at 4.} Because the Second Circuit found no

error

the

Court's

prior determination that

the

United

States satisfied its burden of showing the relevance of the

requested documents

see Appellate Order at 3), the Court now

considers only the questions of whether Respondent properly

invoked his Fifth Amendment privilege and, if so, whether any

doctrine

applies

such

that

Respondent

required to respond to the Summonses.

nevertheless

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For the following reasons,

the Petition to Enforce the

Summonses is GRANTED.

II.

LEGAL STANDARD

The Fifth Amendment provides that

shall be

"[n] o person

[c]ompelled in any criminal case to be a

[w]itness

against himself." U.S. Const. Amend. V. The privilege against

self-incrimination is not absolute: "the Fifth Amendment does

not independently proscribe the compelled production of every

sort

incriminating evidence

but

applies

only when the

accused is compelled to make a [t]estimonial [c]ommunication

that

incriminating."

sher v.

425 u.s.

United States,

391, 408 (1976).

The Supreme Court has recognized,

act

producing

evidence

however,

response

nevertheless has communicative aspects of

that "[t]he

subpoena

its own,

wholly

aside from the contents of the papers produced." Id. at 410;

see

als~

:Q_nited States v____:__I?oE:_, 465 u.s. 605

612

(1984)

("A

government subpoena compels the holder of

the document to

perform an act

aspects

that

incriminating effect.

that

( 2)

(1}

testimonial

and an

Document production can communicate

"documents responsive to a given subpoena exist/ n

"they are

party,"

may have

(3)

the possession or control of the subpoenaed

"the

documents

provided

response

the

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subpoena

are

authentic,"

and

(4)

"the

responding

party

believes that the documents produced are those described in

the subpoena." United States v. Hubbell,

(D.C.

Cir.

1999),

aff'd,

530 U.S.

167 F.3d 552,

(2000);

567-