# Petition — Juren v. United States > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_1082%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1983 - **Citation:** 460 U.S. 1051 ## Text B2-739 [N OCT 28 1992 L. STEVAS. CLERK In the Supreme Court of the United States OCTOBER TERM, 1982 DENNIS JUREN and EDWARD W. CROMEY, PETITIONERS *. UNITED STATES OF AMERICA PETITION FOR A WRIT OF CERTIORARI TO THE TEMPORARY EMERGENCY COURT OF APPEALS OF THE UNITED STATES WILLIAM E. NELSON ROBERT E. MONTGOMERY, JR. (Counsel of Record) (Counsel of Record) SHERLEE S. NELSON PETER BUSCEMI NELSON & NELSON, P.C. PAUL, WEISS, RIFKIND, 1825 Jefferson Pl., N.W. WHARTON & GARRISON Washington, D.C. 20036 A partnership including (202) 659-0815 professional corporations 1714 Massachusetts Ave., N.W. Washington, D.C. 20036 (202) 822-1816 Attorneys for Petitioner Attorneys for Petitioner Edward W. Cromey Dennis Juren WILSON - Epes PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001 QUESTION PRESENTED Whether, under the principles set forth in United States v. LaSalle National Bank, 437 U.S. 298 (1978), a federal agency may issue an administrative subpoena solely for purposes of advancing a criminal investigation, as long as the agency has not yet decided to refer the mat- ter to the Department of Justice for criminal prosecution. (i) TABLE OF CONTENTS Page . i x-! 1 r 1 Statutory Provisions Involved 2 — . 2 The Factual Background of Petitioners’ Subpoena.. 2 The Proceedings Below A. The District Court’s Decision 5 r . 6 C. The Sulton Memoran dunn 7 D. The Denial of Petitioners’ Rule 60 (b) Motion. 9 E. The D. C. Cireuit's Decision 9 L . 10 G. The D.C. Circuit’s Grant of Rehearing 10 Reasons for Granting the Petition 11 EERE ee 18 Appendix A / ae aoe ove la Appendix B D anti ceeiceeeeesihiciainennie tains ee 4a Appendix C D.C. Cireuit Order granting petition for rehearing. 10a Appendix D RESETS ERSTE SEED a OR 12a Appendix E District Court’s Oral Decision — 16a (iii) iv TABLE OF CONTENTS—Continued Page Appendix F February 17, 1982 District Court Order 18a Appendix G District Court Denial of Stay 20a Appendix H March 8, 1982 District Court Order 2la Appendix I March 18, District Court Order 23a Appendix J June 3, 1982 District Court Order 25a Appendix K C — 27a Appendix L TECA Denial of Petition for rehearing and sug- gestion for rehearing en bane .................................. 28a Appendix M The Sulton Memorandum ............-....----2----..--2ceeeeeeee 30a Appendix N — eat aiceialehapan iasiamniansdannesnbaiasties 32a Appendix O Statutory Provisions Involvei 36a v TABLE OF AUTHORITIES Cases: Page Bray v. United States, 423 U.S. 7 6 Coastal States Marketing, Inc. v. New England Petroleum Corp., 604 F.2d 179 (2d Cir. 1979) 6 Donaldson v. United States, 400 U.S. 517, 5338 12, 16 Gulf Oil Corp. v. United States Department of Energy, 689 F.2d 766 (TECA 198177777 6 ICC v. Gould, 629 F.2d 847 (3rd Cir. 1980), cert. denied, 449 U.S. 1077 (1981) ........................---.- 13 NLRB v. Interstate Dress Carriers, Inc., 610 F. 2d r xxx 13 Reisman v. Caplin, 375 U.S. 440, 4» 12 SEC v. Dresser Industries, Inc., 628 F.2d 1368, 1387 (D.C. Cir.), cert. denied, 449 U.S. 998 13 Spinetti v. Atlantic Richfield Co., 522 F.2d 1401 D —60ee˖¾ etait teemianntn 6 Texaco, Inc. v. Department of Energy, 616 F.2d , . 6 United States v. Art Metal-U.S.A., Inc., 484 Supp. e 13 United States v. Cooper, 482 F.2d 1393 (TECA 1 ͤ mm ur. ʃ!1 ˙ WA V nainanidaiaiaai 6 United States v. Exxon Corp., 628 F.2d 70 (D.C. Cir.), cert. denied, 446 U.S. 9644 6 United States v. Giant Industries, Inc., 4 EN. Maur. (CCH) { 26,324 (D. Ariz. 19817 4, 13 United States v. LaSalle National Bank, 437 U.S. —— A ˙ » passim United States v. Uni Oil, Inc., 646 F.2d 946 (5th Cir. 1981), cert. denied, 102 S. Ct. 1254 (1982) 6 Statutes: Economic Stabilization Act of 1970, 12 U.S.C. EATS TIE ETE CATES Oe a ERE 1 , 6 , . ˙ . -- 1 Emergency Petroleum Allocation Act of 1973, 15 D . 1 Section 4, 16 U.S.C. 788 3 I ce 1,6 Section 5(a), 15 U.S.C. 754(a) 3, 4 vi TABLE OF AUTHORITIES—Continued Page Department of Energy Organization Act, 42 U.S.C. 42 ..— v ——— 5, 12 Section 645 1 _ „ 0 Federal Trade Commission Act, 15 U.S.C. 49 Section 9 9 A er aa ed 16 28 U.S.C. 1254(1) — 1 28 U.S.C. 1331 1 6 Miscellaneous: ERA ENFORCEMENT MANUAL (CCH) Ree 3 — 3, 4, 14 Ex. Order No. 12287, 46 Fed. Reg. 9909 (1981) 3 III 9 Mandatory Petroleum Price and Allocation Regu- lations, 10 C. F. R. Parts 205, 210, 211 and 212. 2 In the Supreme Court of the United States OCTOBER TERM, 1982 No. DENNIS JUREN and EDWARD W. CROMEY, PETITIONERS v. UNITED STATES OF AMERICA PETITION FOR A WRIT OF CERTIORARI TO THE TEMPORARY EMERGENCY COURT OF APPEALS OF THE UNITED STATES The undersigned counsel, on behalf of Dennis Juren and Edward W. Cromey, petition for a writ of certiorari to review the judgment of the Temporary Emergency Court of Appeals in this case. OPINIONS BELOW The opinion of the Temporary Emergency Court of Appeals (App. A, infra, la-3a) is not yet reported. The opinion of the D.C. Circuit (App. B, infra, 4a-9a) is not reported. The oral opinion of the district court (App. E, infra, 16a-17a) is not reported. JURISDICTION The judgment of the Temporary Emergency Court of Appeals (App. K, infra, 27a) was entered on September 9, 1982. A petition for rehearing was denied on Septem- ber 28, 1982 (App. L, infra, 28a). The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1) and Sec- tion 211(g) of the Economie Stabilization Act of 1970, 12 U.S.C. 1904 note, incorporated by Section 5(a) (1) (A) of the Emergency Petroleum Allocation Act of 1973, 15 U.S.C. 754(a) (1) (A). 2 STATUTORY PROVISIONS INVOLVED The relevant statutory provisions are reprinted in App. O, infra, 36a. STATEMENT Petitioners are vice presidents of the Tesoro Petroleum Corporation. They live and work in San Antonio, Texas. During the period from 1974 to 1981, Tesoro was the subject of a virtually continuous civil audit by the De- partment of Energy (“DOE”) and its predecessor agen- cies. On July 17, 1981, apparently as part of a separate criminal investigation, DOE issued administrative sub- poenas to petitioners, directing them to appear and testify in Washington, D.C. (App. N, infra, 32a-33a). The subpoenas state that petitioners’ testimony is sought in the investigation by the Department of Energy to determine the compliance of Arizona Fuels Corpora- tion, Demenno Resources, Inc., Goldking Refinery, Ltd., Hill Petroleum, Inc., J & W Refining, Inc., Kenco Refining, Kern County Refining, Inc., Pioneer Re- fining, Inc., Refinery Associates, Inc., Refinery De- velopment, Inc., San Joaquin Refining, Inc., The Tip- perary Corporation, and Tesoro Petroleum Corpora- tion, with the Mandatory Petroleum Price and Allo- cation Regulations, 10 C.F.R. Parts 205, 210, 211 and 212. The subpoenas explain only that “(tjhis investigation concerns purchases, sales, exchanges and processing of certain volumes of crude oil and the purchases, sales and exchanges of its refined products during the period Sep- tember 1976 through December 1977” (App. N, infra, 32a). Because the facts surrounding the issuance of the sub- poenas strongly suggested an improper criminal purpose, and because the subpoenas were insufficiently specific to permit a reasoned judgment concerning the possibility of self-incrimination, petitioners declined to comply. Sub- sequently, in January 1982, the government filed these subpoena enforcement actions in the United States Dis- trict Court for the District of Columbia. THE FACTUAL BACKGROUND OF PETITIONERS’ SUBPOENAS Tesoro is a major integrated refiner that was subject to DOE’s Mandatory Petroleum Price and Allocation Reg- ulations, promulgated pursuant to Section 4 of the Emer- gency Petroleum Allocation Act of 1973 (“EPAA”), 15 U.S.C. 753.“ The EPAA authorized both civil and crimi- nal penalties for regulatory violations, 15 U.S.C. 754(a), and DOE has established separate enforcement divisions to conduct civil and criminal investigations. See Eco- nomic Regulatory Administration (“ERA”) ENFORCE- MENT MANUAL (CCH) §§ 1.503.04, 1.503.07 (deserib- ing the functions of DOE’s Program Operations Divi- sion, which is responsible for conducting civil investi- gations, and its Special Investigations Division, which is responsible for conducting criminal investigations). During the seven-year DOE audit of Tesoro’s compli- ance with EPAA regulations, DOE auditors had on-site access to virtually all of Tesoro’s records relating to the company’s crude oil refining and product marketing ac- tivities, including those records relating to Tesoro’s proc- essing agreements with other refiners during the period October 1976 through May 1977. DOE’s Office of Special Counsel (“OSC”), which was charged with enforcement of the regulations as they applied to the 34 major re- finers, apparently completed its on-site audit of Tesoro in late 1981. ‘ While OSC was completing its civil audit in San An- tonio, the Office of Special Investigations (“OSI”) in Washington, D.C., began an apparently independent in- 1 President Reagan lifted the controls applicable to crude oil and refined petroleum products on January 27, 1981. Executive Order 12287, 46 Fed. Reg. 9909 (1981). On September 30, 1981, the EPAA expired. 15 U.S.C. 760068 4 vestigation of suspected willful violations involving cer- tain of Tesoro’s processing agreements with other re- finers.“ In pursuit of this investigation, OSI issued the subpoenas ad testificandum that are the subject of this litigation. Before the date for petitioners’ appearances, their coun- sel learned that Miranda-type warnings were being given to witnesses testifying before OSI in connection with this investigation, and that at least one criminal referral to the Department of Justice had already occurred as a result of a similar investigation. See United States v. Giant Industries, Inc., 4 EN. Mar. (CCH) { 26,324 (D. Ariz. 1981). Because OSC’s auditors were even then con- ducting an intensive audit at Tesoro’s headquarters, with the company’s full cooperation, the issuance of formal subpoenas seeking to compel testimony from two senior ex- ecutives seemed a highly unusual and unnecessary step. In an August 1981 letter to DOE, counsel for petitioner Juren expressed his concern regarding the apparent crim- inal purpose of the DOE subpoenas (R-14 to R-18).* DOE officials did not reply to this letter. Indeed, petitioners heard nothing further regarding the subpoenas until the government began these actions. In ensuing discussions with counsel, attorneys for the gov- ernment declined to provide assurances that petitioners are not “targets” of a criminal investigation. The gov- ernment lawyers would say only that the planned in- terrogation of petitioners would involve “processing.” 2 OSI is “[rJesponsible for the management of special investiga- tions which center on possible willful violations of ERA regulations, and those which carry the possibility of referral to the Department of Justice for consideration of prosecution.” ERA ENFORCEMENT MANUAL CCH) § 1.503.07. Under Section 5(a) of the EPAA, 15 U.S.C. 754(a), a “willful” violation of the regulations is subject to criminal penalties. „R“ refers to the record on appeal in the Temporary Emergency Court of Appeals, a copy of which has been lodged with the Clerk of this Court. 5 Moreover, DOE refused to permit petitioners to review in advance the documents on which they would be questioned. In response to petitioners’ request for more specific infor- mation concerning the type of violation being investigated, OSI refused to go beyond the general regulatory refer- ences contained in the subpoena (R- 99 to R-100). In opposing DOE’s subpoena enforcement petitions, pe- titioners contended that the subpoenas had been issued for an unlawful criminal purpose, and they sought discovery to establish that fact (R-168 to R-185). Petitioners also maintained that, because of DOE’s failure to provide any coherent statement of the law applicable to the processing agreements regarding which they were to be questioned, they were unable intelligently to exercise or waive their privilege against compulsory self-incrimination and there- fore were deprived of their Fifth Amendment rights. Finally, petitioners argued that Section 645 of the De- partment of Energy Organization Act (“DOEOA”), 42 U.S.C. (Supp. III) 7255, on which the government relied, did not confer jurisdiction on the district court in the Dis- trict of Columbia to entertain the government’s subpoena enforcement actions. Rather, petitioners argued, the ac- tions should have been filed in the Western District of Texas, where petitioners live and work, and where the government’s claims arose. THE PROCEEDINGS BELOW A. The District Court’s Decision Following a hearing (R-230 to R-273), the district court granted enforcement of the DOE subpoenas. The court provided little explanation of the reasons for its de- cision (App. E, infre, 16a-17a). The court noted its “deep sympathy” for the position confronting petitioners, but it concluded that the subpoenas should be enforced in light of DOE’s representations that it has made neither a “criminal referral” to the Department of Justice nor a decision to make such a referral. The district court de- nied petitioners’ request for discovery regarding the pur- pose of DOE’s investigation (App. F, infra, 18a-19a). The district court also denied a stay pending appeal (App. G, infra, 20a). B. Petitioners’ Appeals Due to uncertainty regarding appellate jurisdiction, pe- titioners appeal to both the D.C. Circuit and the Tempo- rary Emergency Court of Appeals (“TECA”).‘ Petition- * Section 211(b)(2) of the Economic Stabilization Act of 1970 (“ESA”), 12 U.S.C. 1904 note, incorporated by Section 50a) (1) (A) of the Emergency Petroleum Allocation Act of 1973 (“EPAA”) 15 U.S.C, 754(a)(1)(A), provides that the TECA shall have exclusive jurisdiction of all appeals from the district courts of the United States in cases and controversies arising under [the ESA or the EPAA] or under regulations or orders issued thereunder. Notwithstanding the broad language of Section 211(b)(2), which appears to track the “arising under” formula of 28 U.S.C. 1331, the reported cases establish that the TECA's jurisdiction is a limited “issue” jurisdiction that depends on whether the particular question in dispute involves some aspect of the ESA or the EPAA. See, e.g., Coastal States Marketing, Inc. v. New England Petroleum Corp., 604 F.2d 179 (2d Cir. 1979); Texaco, Inc. v. Department of Energy, 616 F.2d 1193 (TECA 1979); Gulf Oil Corp. v. United States Department of Energy, 639 F.2d 766 (TECA 1981) ; Spinetti v. Atlantic Richfield Co., 522 F.2d 1401 (TECA 1975); United States v. Cooper, 482 F.2d 1393 (TECA 1973). When a case, or a segregable part of a case, does not involve the interpretation or application of one or both of those statutes, appeal from a district court’s ruling lies in the appropriate circuit court of appeals rather than in the TECA. See, e.g., Bray v. United States, 423 U.S. 73 (1975); United States v. Uni Oil, Inc., 646 F.2d 946 (5th Cir. 1981), cert. denied, 102 S. Ct. 1254 (1982); Coastal States Marketing, Inc. v. New England Petroleum Corp., supra; Texaco, Inc. v. Department of Energy, supra; Gulf Oil Corp. v. United States Department of Energy, supra; United States v. Exxon Corp., 628 F.2d 70 (D.C. Cir.), cert. denied, 446 U.S. 964 (1980). As the Second Circuit observed in Coastal States, 604 F.2d at 185, „[plerhaps the clearest indication that the TECA and other courts 7 ers challenged the jurisdiction of the district court, the improper criminal purpose of the subpoenas, and the reg- ulatory vacillation of DOE that made it impossible for petitioners to determine rationally whether to exercise their Fifth Amendment privilege against compulsory self- incrimination. The D.C. Circuit granted a stay pending appeal and set an expedited briefing schedule (App. D, infra, 12a-15a). C. The Sulton Memorandum While the appeals were pending, petitioners acquired new evidence that substantially bolstered their claim that the DOE subpoenas were issued for an improper criminal purpose. The evidence, initially obtained by Tesoro through a Freedom of Information Act request, is a DOE file memorandum prepared by the Assistant Solicitor of OSC, Gloria Sulton (App. M, infra, 30a-3la). Sulton is one of the two DOE officials before whom petitioners were commended to appear in response to the disputed sub- poenas. The Sulton memorandum recounts a March 1979 meeting between DOE officials and attorneys in the Crim- inal Division of the Department of Justice. In addition to Sulton, the DOE officials present at the meeting included of appeals regard the TECA’s jurisdiction as some form of ‘issue’ jurisdiction is the development of a system of bifurcated appeals from unitary judgments” (citing cases). Of course, disputes have arisen concerning the proper characteri- zation of particular issues. The present case involved issues con- cerning the district court’s jurisdiction, the criminal nature of DOE’s investigation, and petitioners’ Fifth Amendment privilege against compulsory self-incrimination. The government argued that all of these issues fell within the TECA's exclusive jurisdiction. But none of the issues required any interpretation or application of the ESA or the EPAA. The jurisdictional issue, in particular, turns on another statute altogether, Section 645 of the DOEOA, 42 U.S.C. (Supp. III) 7255. Accordingly, petitioners believed that at least the jurisdictional issue, and perhaps the other two issues as well, should be decided by the D.C. Circuit. To avoid waiving any rights, petitioners appealed all three issues to both courts of appeals. Jeffrey Whieldon and Jerome Wiener, the two persons who have filed affidavits on behalf of the government in these enforcement actions (see R-198 to R-204). The memorandum states that the meeting concerned “approximately 18 ‘cluster’ audits involving the Entitle- ment Program * * *.” In particular, the meeting focused on the so-called Tesoro/Young investigation, which was characterized as “the most fully developed case” of the 18. (Petitioners have repeatedly asserted their belief that the subpoenas now in dispute were issued in connection with one or more of the other 18 “cluster” audits, and the gov- ernment has never disputed that assertion.) The purpose of the March 1979 meeting, as reflected in the Sulton memorandum, was informally to brief Criminal Division officials on the Tesoro/Young matter, and to discuss “ad- ditional steps to put the case in a posture for referral” (App. M, infra, 30a). DOE officials thought such a dis- cussion “would be helpful for this case as well as those still under investigation” (ibid.) Among the subjects dis- cussed were “potential problems with prosecution.” The memorandum on the March 1979 meeting concludes with the following paragraph (App. M, infra, 3la; em- phasis added) : The last question to be answered was the nature and extent of further work by DOE before referral to DOJ. It was agreed that depositions of key per- sons should be taken before a referral is made. OSC and OGC will work together in issuing subpoenas and scheduling the taking of testimony. The Sulton memorandum thus shows that, in an investi- gation which either actually encompassed or at least closely paralleled DOE’s present inquiry, the government deliberately delayed referral to the Department of Justice in order to gather further evidence through DOE sub- poenas. More fundamentally, the memorandum demon- strates that DOE used its subpoena power in such a case solely for purposes of a criminal investigation. For these reasons, petitioners moved in the district court for a new hearing under Fed. R. Civ. P. 60(b). Petitioners argued that, at the very least, the Sulton memorandum shows that petitioners ure entitled to some measure of discovery con- cerning the purposes for which the present DOE sub- poenas were issued. D. The Denial of Petitioners’ Rule 60(b) Motion The district court denied relief, noting only that DOE had represented that the Tesoro/Young investigation had been closed, and that that investigation “involved different facts and was conducted separately from the investigation in which the subpoenas in the present case were issued” (App. J, infra, 26a). The court did not address the peti- tioners’ contention that the Sulton memorandum revealed DOE to have used its administrative subpoena power im- properly with respect to all 18 of the so-called “cluster” audits—of which the present investigation is apparently one. E. The D.C. Cireuit's Decision In July 1982, the D.C. Cireuit ruled that the district court did have jurisdietion to hear the government's en- forcement actions (App. B, infra, 4a-9a). The court of appeals relied exclusively on Section 645 of the DOEOA and that provision’s incorporation of Section 9 of the Fed- eral Trade Commission Act, 15 U.S.C. 49. Although ac- knowledging the persuasive force of petitioners’ argu- ment to the contrary, the court held that it makes no difference whether Congress, in incorporating Section 9, “referred only to the subpoena issuance authority of the administrative agency” or “explicitly incorporated both the agency authority to issue subpoenas and the judicial authority to enforce subpoenas” (App. B, infra, 6a)“ 5In case the Court wishes to examine petitioners’ jurisdictional argument in the courts below, copies of petitioner Juren’s brief and reply brief in the D.C. Circuit, together with the petition for re- hearing in that court, have been lodged with the Clerk of this Court. 10 The D.C. Circuit declined to pass on petitioners’ sub- stantive challenges to the DOE subpoenas, holding that those matters are EPAA issues over which the Tempo- rary Emergency Court of Appeals has exclusive jurisdic- tion” (App. B, infra, 8a). F. The TECA’s Decision In September 1982, the TECA upheld the DOE sub- poenas (App. A, infra, la-3a). Like the district court, the court of appeals was persuaded that the subpoenas should be enforced because “DOE had made no determination to refer the case for crimina: investigation” (id. at 2a). Without referring to any of the evidence cited by petitioners to show that the DOE subpoenas were issued as part of a criminal investigation, the TECA declared simply that petitioners’ allegations of improper purpose were not “buttressed with specific facts” (id. at 3a). The TECA did not address the question of the district court’s jurisdiction. The court’s brief opinion does not reveal whether the TECA thought (a) that the district court had jurisdiction under Section 645 of the DOEOA; or (b) that, because the D.C. Circuit had already decided the jurisdictional issue, the TECA should not address it as well; or (c) that, because the jurisdictional question turns on a statute other than the ESA or the EPAA, the TECA lacks authority to review the matter. G. The D.C. Cireuit's Grant of Rehearing On October 5, 1982, the D.C. Circuit granted petitioners’ request for rehearing on the question of the district court’s jurisdiction (App. C, infra, 10a-lla). The court vacated its July 1982 opinion, and announced that a new decision “will issue at some future date” on the basis of the written submissions already made. 11 REASONS FOR GRANTING THE PETITION This case presents an important question concerning the authority of federal agencies to use their administra- tive subpoena power for criminal investigations. The gov- ernment maintains, and the courts below held, that an agency may issue such a subpoena solely for purposes of a criminal investigation, as long as the agency has made no decision to refer the matter to the Department of Justice for prosecution. That is not the standard adopted by this Court in United States v. LaSalle National Bank, 437 U.S. 298 (1978). Under LaSalle, the critical inquiry is whether the agency issuing a subpoena has made an “institutional commitment” to treat the matter as a criiuinal case. Here, there are substantial indications of such a commitment, all of which were disregarded by the courts below because of the courts’ erroneous concentration on whether the agency had actually decided to refer the case to the Department of Justice. Intervention by this Court is needed to correct the lower courts’ misapplication of LaSalle, and to ensure that the subpoena authority of DOE and other agencies is not used for purposes beyond those sanctioned by Con- gress. Before turning to a further discussion of the LaSalle issue, the peculiar procedural context of this petition must be mentioned. The D.C. Circuit has granted re- hearing, and has vacated its opinion sustaining the juris- diction of the district court. The D.C. Circuit may well rule on rehearing that the government’s enforcement ac- tions against petitioners were not properly brought in the District of Columbia, and should have been brought in the Western District of Texas. In that event, this Court should grant the present petition, vacate the TECA’s decision, and remand for reconsideration in light of the D.C. Cireuit's ruling. On the other hand, if the D.C. Circuit adheres to its earlier decision and merely sup- ports it with a new opinion, petitioners will seek re- view in this Court, and the Court can simultaneously 12 consider both the jurisdictional and substantive ques- tions presented. If this Court does not hold the present petition pend- ing the outcome of the rehearing in the D.C. Circuit, undesirable consequences could ensue. If the Court were to grant this petition now, and the D.C. Circuit were subsequently to hold that the district court lacked juris- diction, the precedential value of any decision this Court might render would be cast in doubt. This is particu- larly so if, as we believe, the TECA’s appellate jurisdic- tion does not extend to issues under the DOEOA, and TECA therefore could not rule on the district court’s jurisdiction (see note 4, supra). If the Court were to deny this petition now, and the D.C. Circuit were subsequently to hold that the district court lacked jurisdiction, the government might well try to assert some res judicata or collateral estoppel effect of the TECA judgment in a subsequent enforcement ac- tion in the Western District of Texas. Petitioners, of course, would argue that the TECA decision could have no such effect in light of the holding on direct appeal that the district court lacked jurisdiction over the gov- ernment’s actions. These potential difficulties can easily be avoided, however, if this Court simply holds the present petition pending the D.C. Circuit’s decision on rehearing. 1. Returning to the reasons why this petition ulti- mately should be granted, we begin with the well- established proposition that an administrative subpoena may not be used solely to obtain evidence for a criminal prosecution. United States v. LaSalle National Bank, supra, 437 U.S. at 316; Donaldson v. United States, 400 U.S. 517, 533 (1971); Reisman v. Caplin, 375 US. 440, 449 (1964). As this Court explained in LaSalle, absent “an affirmative grant of summons authority for 13 purely criminal investigations,” 437 U.S. at 317 n.18, an agency that issues an administrative subpoena to obtain evidence for a criminal prosecution is not exercis- ing its subpoena power in the good-faith pursuit of a legitimate objective. Id. at 316 & n.18. The Court ac- cordingly announced that it would “not countenance delay in submitting a recommendation to the Justice Department when there is an institutional commitment to make [a criminal] referral and the [agency] merely would like to gather additional evidence for the prosecu- tion.” Id. at 316-317. “Similarly, the good-faith stand- ard will not permit the [agency] to become an information-gathering agency for other departments, in- cluding the Department of Justice * * *.” Id. at 317. Although LaSalle involved a summons issued by the Internal Revenue Service, numerous courts have recog- nized that LaSalle’s principles apply to other administra- tive agencies, including DOE. See ICC v. Gould, 629 F.2d 847 (3d Cir. 1980), cert. denied, 449 U.S. 1077 (1981); NLRB v. Interstate Dress Carriers, Inc., 610 F.2d 99 (8d Cir. 1979); United States v. Giant Industries, 4 EN. MGMT. (CCH) { 26,324 (D. Ariz. 1981) (applied to DOE); United States v. Art Metal-U.S.A., Inc., 484 Supp. 884 (D. N.J. 1980) (applied to Inspector General of GSA). See also SEC v. Dresser Industries, Inc., 628 F.2d 1368, 1387 (D.C. Cir.), cert. denied, 449 U.S. 993 (1980) (SEC subpoenas must be issued in good faith, and not solely for criminal purposes). 2. Here, there are strong indications that the DOE subpoenas were issued to petitioners solely for a criminal purpose. Among these items of evidence are the follow- ing: a. The administrative subpoenas were issued by OSI, the division within DOE that has expressly been as- signed the responsibility for investigating suspected 14 criminal violations of DOE regulations. ERA ENFORCE- MENT MANUAL (CCH) § 1.503.07.° b. The subpoenas were issued after DOE’s civil en- forcement branch (OSC) had already completed its in- dependent and unrelated investigation of Tesoro’s com- pliance with the pertinent regulations. ce. OSI is seeking not simply further information, or even answers to specific questions concerning Tesoro’s processing arrangements, but the personal testimony of petitioners in a way undeniably indicative of a highly focused criminal investigation. Government attorneys have announced that they will give petitioners Miranda- type warnings. DOE will provide no assurance that peti- tioners are not “targets” of a criminal investigation. d. Although DOE has in its possession a large number of documents relevant to the transactions that are the subject of the subpoenas issued to petitioners, OSI has re- fused to meet with counsel to discuss the specific subject matter of the proposed interrogations or to provide peti- tioners with an opportunity to review in advance those documents regarding which they would be interrogated. OSI has also refused to disclose the types of violations being investigated, beyond the inscrutable references con- tained in the subpoenas. e. The Sulton memorandum shows that in conducting its “Tesoro/Young investigation” DOE not only used its 6 The clear distinction between civil and criminal investigations within DOE, and the unquestionable focus of this investigation on suspected criminal violations, are dramatized by the recent internal reorganization of the ERA, which separated OSI entirely from the other enforcement arms. In that reorganization, DOE formalized the separation of the criminal investigatory authority reposing in OSI from the civil investigatory authority delegated to other divi- sions of the agency (R-102 to R-136). In anticipation of this reor- ganization, Mr. Rayburn Hanzlik, the Administrator of ERA, was quoted in the press describing Mr. Whieldon, the official who signed the subpoena issued to appellant Juren, as a “criminal expert” (R-138 to R-140). 15 subpoena power for a purely criminal investigation, but also consciously conspired with Criminal Division attor- neys to delay a referral to the Justice Department until additional evidence could be gathered through administra- tive subpoenas. The Tesoro/Young investigation was only one of 18 entitlement “cluster” audits under investi- gation at the time of the Sulton memorandum; the gov- ernment has not denied that petitioners’ subpoenas were issued in connection with one or more of the other 18 such audits which were discussed at the March 1979 meet- ing. The DOE officials who participated in that meeting were precisely the same DOE officials who are now seeking to compel petitioners’ testimony. 3. In response to the foregoing evidence, the govern- ment has offered only the equivocal affidavits of two DOE officials who attended the March 1979 meeting memorial- ized in the Sulton memorandum (R-198 to R-204). Not- withstanding the government’s conceded obligation to make a prima facie showing that the subpoenas directed to petitioners did in fact have a lawful civil purpose, the affidavits do not contain any clear and unqualified state- ment to that effect. The affidavits appear to say only that the information sought through the subpoenas “may” be used to further a civil purpose, not that the subpoenas were actually issued with such a purpose in mind. The affidavits contain lengthy generalized descriptions of the functions of OSI and the various possible pur- poses to which information gathered in a special investi- gation may be put. They also assert that there has been no criminal referral of, or decision to refer, this case to the Department of Justice. But, on the simple, direct, and most relevant issue of whether the disputed sub- poenas were issued solely for a bona fide civil purpose, th. affidavits are conspicuously silent. 4. Petitioners identified numerous indicators that the DOE subpoenas were intended solely to advance a crim- 16 inal investigation. The government responded with in- conclusive affidavits. Yet the TECA panel found that petitioners had “presented no evidence that DOE acted improperly” (App. A, infra, 2a). This ruling was possible only because the TECA, like the district court, viewed as dispositive the agency’s representations that it had not yet decided to refer petitioners’ case to the Department of Justice (App. A, infra, 2a; App. E, infra, 17a). That is not the critical consideration under LaSalle. The critical question is whether there has been an “institutional com- mitment” to conduct a purely criminal investigation. Here, the evidence of such a commitment was substantial. It was at least sufficient to warrant further inquiry through limited discovery regarding DOE’s objectives. The courts below demurred, because they erroneously focused exclusively on whether a referral] decision had been made. LaSalle involved an IRS investigation of a taxpayer’s tax liability. Unlike the investigating division of DOE, the investigating division of the IRS is not bifurcated. It is charged with uncovering both civil] and criminal violations of the Internal Revenue Code. See 26 U.S.C. 7602; see also Donaldson v. United States, 400 U.S. 517, 535 (1971). Thus, in LaSalle, the only reliable indicator of whether an investigation was solely criminal may have been an actual decision to refer the case to DOJ. Given the “institutional posture” of DOE, however, reliable indicators of a purely criminal investigation can be identified well in advance of an actual decision to refer. It is therefore not necessary to await a referral decision to ascertain the nature of the “institutional commit- ment.” DOE has already made an institutional commit- ment, apparently with the full knowledge and approval of the Justice Department’s Criminal Division, to con- duct a criminal, as distinguished from a civil, investi- gation. At minimum, therefore, the government should 17 be required to make an affirmative showing that the ad- ministrative subpoenas are not being used “to expand [the government's] criminal discovery rights,” or as a means of allowing the DOE “to become an information- agency for * * * the Department of Justice” (437 U.S. at 317). Both the district court and the TECA misunderstood the standard set forth in LaSalle. Had these courts recog- nized that LaSalle requires a judicial determ*~~*tion as to whether the egency has committed itself to . criminal investigation (whether performed internally or by the Department of Justice),’ and recognized the differ- ences in enforcement structure between DOE and the IRS, they could not have found petitioners’ evidence irrele- vant, or the government’s representations conclusive. Those courts erred in accepting DOE’s representation that no referra! decision has been made as equivalent to the re- quired showing that “the information sought will advance a civil, as distinguished from a criminal, investigation.” In this case, the former simply does not establish the latter. This Court should grant review to correct the danger- ous misimpression that agency subpoenas automatically satisfy the LaSalle standard, as long as no referral deci- sion has been made. TIt can hardly be suggested, and the government has not at- tempted to suggest, that the prohibition of LaSalle extends only to criminal investigations conducted by DOJ. The Supreme Court's warning related to the type and purpose of the investigation being conducted, not to the identity of the agency conducting it. 18 CONCLUSION The petition for a writ of certiorari should be held pending the D.C. Circuit’s rehearing on the question of the district court’s jurisdiction. If the D.C. Circuit reverses, this petition should be granted, the judgment vacated, and the case remanded for reconsideration in light of the D.C. Cireuit's ruling. If the D.C. Circuit affirms, this petition should be granted. Respectfully submitted. WruiaM E. NELSON RoBERT E. MONTGOMERY, JR. (Counsel of Record) (Counsel of Record) SHERLEE S. NELSON PETER BUSCEMI NELSON & NELSON, P.C. PAUL, WEiss, RIFKIND, 1825 Jefferson Pl., N. W. WHARTON & GARRISON Washington, D.C. 20036 A partnership including (202) 659-0815 professional corporations 1714 Massachusetts Ave., N.W. Washington, D.C. 20086 (202) 822-1816 Attorneys for Petitioner Attorneys for Petitioner Edward W. Cromey Dennis Juren --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_1082%3A1. Public record. Not legal advice.