# Petition for Writ of Certiorari — Roe v. United States

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1990
- **Citation:** 493 U.S. 1044

## Text

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OCT 26

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JOSEPH F. SPANIOL gr

No. CLERK

IN THE
Supreme Court of the United States

OCTOBER TERM, 1989

RICHARD ROE,
Petitioner,
Vv.

UNITED STATES OF AMERICA,
Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

ROBERT P. WATKINS
Counsel of Record

JOHN D. CLINE

PAUL BUTLER
WILLIAMS & CONNOLLY
839 17th Street, N.W.
Washington, D.C. 20006
(202) 331-5000

October 26, 1989 Attorneys for Petitioner

WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

QUESTIONS PRESENTED

1. Does an appeal from a judgment of civil contempt
for failure to comply with a grand jury subpoena become
moot upon expiration of the grand jury’s term?

2. Does the “capable of repetition, yet evading review”
exception to the mootness doctrine apply to an appeal
from a judgment of civil contempt where the witness and
the government agree that the matter is moot and there
is no record evidence that the witness will ever be sub-
poenaed again?

3. Does United States v. Munsingwear, Inc., 340 US.
36 (1950), require that prior opinions in a moot case be
vacated?

(i)

TABLE OF CONTENTS

Page
QUESTIONS PRESENTED .......................-...........000.00+. i
ps EER Vv
OPINIONS BELOYV ........... ai bbicnseideeinitneeasdannbeiopiniaichinbeanei 1
Nee ici aseinksisaidanaiannnannianiedaninatannnnnns 2
CONSTITUTIONAL PROVISION INVOLVED .......... 2
GREED ‘nes setncnencenessissctiannvanvennnensennearannece 2
STATEMENT OF THE CASE ......0...0..........................- 3
REASONS FOR GRANTING THE WRIT .................... 5

I. THE COURT OF APPEALS’ HOLDING
THAT A CONTEMPT JUDGMENT IS NOT
MOOT AFTER EXPIRATION OF THE
GRAND JURY CONFLICTS WITH DECI-
SIONS IN THREE OTHER CIRCUITS .......... 7

A. The Court of Appeals’ Decision Conflicts
with the Ninth Circuit’s Decision in Jn re
Grand Jury Proceedings .......... lc ieneneetadinns 7

B. The Court of Appeals’ Decision Conflicts
with the Eighth Circuit’s Decision in
ERIS SS REE EIR en 9

C. The Court of Appeals’ Decision Conflicts
with the Fifth Circuit’s Decision in Leppig.. 10

Il. MUNSINGWEAR MANDATES THAT THE
OPINIONS OF THE COURTS BELOW _BE
VACATED ......... itecinieapalcabalbieniiawcnetthinciotaic liinanaasienen 11

I a eeslechatsatvtrleendintnccntenheneenaseianneesanteeoencmaneianeans 12

iv

TABLE OF CONTENTS—Continued

APPENDICES Page
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TA. ceecsoncenssinereeuvesspannantcnssntchben’-<taensnenesinhsatineasssentiiasieaaiidainasate 20a
Is. sscisscuapcsnninaitapedieeimnlteatcaediahieniaaadniantaateadnnapaseeisnaateieaia 2la
HPs... asinssaniapiessstcnteundshaihassamen teiainasiicenrsnniianemaniinaiciinninaiintadinaaibiie. 22a
B ccnsecscetsesssescesssstnetnsnsnetncinitasncnninnipsannanasniiennbianeaensseeeeitia 23a
Ss. <ucecresedsnyssinarsen cesenienrcteennphennesnnieitesneneneisienndiasshesinnbedinddenmneaelnieat 24a

Vv
TABLE OF AUTHORITIES

CASES: Page
Alabama Vv. Davis, 446 U.S. 903 (1980) .....00000...... ll
Braswell v. United States, 487 U.S. 99 (1988)........ 4
Burke v. Barnes, 479 U.S. 361 (1987) -.......0.0000....... 6, 11
Duke Power Co. v. Greenwood County, 299 U.S.

Ie CD cicectercesceiseedasabinnlenidabaicinbiniatbcadiidttiaiibiatinnitalinie 11
Fisher v. United States, 425 U.S. 391 (1976) ........ 4
Great Western Sugar Co. v. Nelson, 442 U.S. 92

CED ceccisnscvtsintentnabsinaninsinidisiatins 11
Hall v. Beals, 396 U.S. 45 (1969) —.......00.. 6
Hayburn’s Case, 2 U.S. (2 Dall.) 409 (1792) ....... 6
In re Grand Jury Proceedings, 863 F.2d 667 (9th

GAIA BUI: sche cretihsoceerenbisesneteeinnintebeniaietaasnapiaaindicats 7,8,9
In re Grand Jury Proceedings (Klayman), 760

re ee ie BIE. iitennnenctinehcerntnneinnsnenstiines 9
In re Grand Jury Proceedings (Larson), 785 F.2d

Re ee I ark ecictenrcncitinhiteniaiisemassiocsiens 9,10
Leppig Vv. Martin, 386 F.2d 190 (5th Cir. 1967) .... 10
Murphy V. Hunt, 455 U.S. 478 (1982) —.......00...... 6
In re Sealed Case, 829 F.2d 189 (D.C. Cir. 1987) .. 8
In re Sealed Case, 832 F.2d 1268 (D.C. Cir. 1987) .. 4
United States v. Doe, 465 U.S. 605 (1984).............. 4
United States v. Munsingwear, Inc., 340 U.S. 36

Eiri iiccebensisicienca caeehiniia Nenbumaleeishdnlaniptacaasitesiantddeebiiadicoentnnincesd 5, 6, 11
Weinstein v. Bradford, 423 U.S. 147 (1975) ........... 6,9

CONSTITUTIONAL PROVISIONS:

I CUI Lc bh acaetchananuneneiicidoncbies 5, 6
RS EEE ae OREN Oe 3, 4,5

STATUTES AND RULES:
et Te RE 9
SER eee pa em era rom 8
STS TESTA AREA AE OT OREN IR 4
EN NT me ne aN TF 8
i I I ID cs csnsstirnai ncneceietchtnnichiieliaiedeniebiiadiidah 8

MISCELLANEOUS:

Correspondence of the Justices (Aug. 8, 1793),
reprinted in HART AND WECHSLER’S THE FED-

ERAL COURTS AND THE FEDERAL SYSTEM 66-67

GREE ie. MIMTIIIIEE - cipeiinsisccesbinsinrtiaepdeisaapiesisaiepnnsebipbiitebacsaibelaaibildiias 6

ay =.

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

No.

RICHARD ROB,
Petitioner,
Vv.

UNITED STATES OF AMERICA,
Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Petitioner prays that a writ of certiorari issue to re-
view the judgment of the United States Court of Appeals
for the District of Columbia Circuit affirming in part
the judgment of contempt entered by the United States
District Court for the District of Columbia and holding
that the case was not moot.

OPINIONS BELOW

The court of appeals’ unreported opinion refusing to
vacate its judgment as moot is reprinted infra at App.
la-2a.' The earlier opinion of the court of appeals that

1 References herein to “App.” are to the Appendix to this Peti-
tion. References to “C.A.” are to the Appendix filed in the court
of appeals.

2

was moot when rendered is reported at 877 F.2d 83 and
is reprinted infra at App. 3a-18a. The district court's
unreported orders—Apps. C, D, and E—were filed under
seal by that court and have been lodged under seal with
the Clerk of this Court.

JURISDICTION

The judgment of the court of appeals was entered on
June 6, 1989. App. 22a. A timely petition for rehearing,
with a suggestion for rehearing en banc, was denied on
August 29, 1989. App. 23a, 24a. The jurisdiction of this
Court is invoked pursuant to 28 U.S.C. § 1254(1).

CONSTITUTIONAL PROVISION INVOLVED

Article III, § 2 of the United States Constitution pro-
vides in pertinent part: “The judicial Power shall extend
to all Cases, in Law and Equity, arising under this Con-
stitution, the Laws of the United States, and Treaties
made, or which shall be made, under their Authority

”
.

STATUTES INVOLVED

Section 1657 of Title 28, United States Code, provides
in pertinent part:

(a) Notwithstanding any other provision of law,
each court of the United States shall determine the
order in which civil actions are heard and deter-
mined, except that the court shall expedite the con-
sideration of any action brought under chapter 153
or section 1826 of this title. ...

Section 1826 of Title 28, United States Code, provides
in pertinent part: r

(a) Whenever a witness in any proceeding before
or ancillary to any court or grand jury of the United

3

States refuses without just cause shown to comply
with an order of the court to testify or provide other
information, including any book, paper, document,
record, recording or other material, the court, upon
such refusal, or when such refusal is duly brought
to its attention, may summarily order his confine-
ment at a suitable place until such time as the wit-
ness is willing to give such testimony or provide such
information. No period of such confinement shall
exceed the life of—

(1) the court proceeding, or

(2) the term of the grand jury, including ex-
tensions,

before which such refusal to comply with the court
order occurred, but in no event shall such confinement
exceed eighteen months.

(b) No person confined pursuant to subsection
(a) of this section shall be admitted to bail pending
the determination of an appeal taken by him from
the order for his confinement if it appears that the
appeal is frivolous or taken for delay. Any appeal
from an order of confinement under this section shall
be disposed of as soon as practicable, but not later
than thirty days from the filing of such appeal.

STATEMENT OF THE CASE

On October 6, 1988, a federal grand jury in the District
of Columbia issued three subpoenas to Petitioner Roe as
“Custodian of Record” for three entities. The subpoenas
required Roe to produce certain documents to the grand
jury. C.A. 1-4. The government had previously informed
Roe that he was a target of the grand jury’s investiga-
tion. Roe notified the government that he would assert
his Fifth Amendment privilege against self-incrimination
in response to two of the subpoenas. C.A. 5-11.

On February 10, 1989, the district court ordered Roe
to comply with the two subpoenas. Apps. C, D. Roe de-

seen inate

4

clined to do so on the basis of his Fifth Amendment act-
of-production privilege. On March 2, the district court
held Roe in civil contempt and ordered him confined pur-
suant to 28 U.S.C. § 1826(a) for the life of the grand
jury, unless and until he complied with the subpoenas.
App. E.* The district court’s judgment made clear that
the grand jury would expire on June 2, 1989. Jd.

On March 9, 1989, Roe appealed the judgment of con-
tempt to the United States Court of Appeals for the Dis-
trict of Columbia Circuit. On June 2, the term of the
grand jury expired and it was dissolved. On June 6,
four days after the grand jury had ceased to exist, the
court of appeals issued an opinion and entered a judg-
ment reversing the contempt judgment regarding one
subpoena, App. 13a-18a, but affirming the contempt judg-
ment with respect to the other, App. 5a-13a.*

On June 8, 1989, two days after the court of appeals
had rendered its opinion and six days after the term

2 The Fifth Amendment act-of-production privilege rests on this
Court’s decisions in Fisher v. United States, 425 U.S. 391 (1976),
and United States v. Doe, 465 U.S. 605 (1984).

3 Subject matter jurisdiction in the district court was founded on
28 U.S.C. § 1826(a). Roe was released on personal recognizance
pending appeal.

*In affirming the judgment of contempt as to one subpoena, the
court of appeals held that Roe could not invoke the Fifth Amend-
ment act-of-production privilege in response to that subpoena be-
cause the government had established a “reasonable basis” to be-
lieve that Roe was a corporate custodian of records, and Braswell
v. United States, 487 U.S. 99 (1988), precludes a corporate cus-
todian from asserting the act-of-production privilege for corporate
records. In applying the ‘‘reasonable basis” standard for determin-
ing custodianship, the court of appeals rejected the holding of
another panel of the District of Columbia Circuit that the govern-
ment must prove to a “foregone conclusion” that the witness is a
corporate custodian to overcome the act-of-production privilege.
In re Sealed Case, 832 F.2d 1268, 1280 (D.C. Cir. 1987).

~

—
vo

of the grand jury had expired, Roe moved the court to
vacate its opinion as moot. Roe contended that, after the
expiration of the grand jury, there had no longer been a
“case” or “controversy” that would permit federal juris-
diction under U.S. Const. art. III, § 2.

Roe’s motion was not opposed by the United States.
The government informed the court that it “agrees that
the opinion of the Court must be vacated and this case
remanded to the district court with directions to vacate
the contempt citation.” App. 25a.

Despite the agreement of the parties that the matter
was moot and indeed had become moot four days before
the court of appeals acted, and despite their agreement
that the judgment of the court of appeals should be va-
cated, that court nevertheless refused to vacate its opin-
ion, on the ground that “[t]he case falls within the ‘cap-
able of repetition but evading review’ exception to the
mootness doctrine.” App. la.

REASONS FOR GRANTING THE WRIT

The error of the court of appeals is so fundamental
that its judgment can be vacated without additional
briefs or oral argument. That court rendered an advisory
opinion on significant Fifth Amendment issues, despite
the indisputable fact, acknowledged by both parties, that
the case had become moot before the court of appeals
acted. Moreover, the court’s sua sponte invocation of the
“capable of repetition, yet evading review” exception to
the mootness doctrine directly conflicts with decisions
from the Fifth, Eighth, and Ninth Circuits holding cases
moot in these circumstances.

The court of appeals’ decision also conflicts with United
States v. Munsingwear, Inc., 340 U.S. 36 (1950), in
which this Court held that when a case becomes moot on
app2al the court should vacate the lower court judgment
and remand with directions to dismiss.

6

It is fundamental that Article III of the Constitution
limits the power of the federal judiciary to live “cases”
or “controversies.” U.S. Const. art. III, § 2; see Burke
v. Barnes, 479 U.S. 361, 863 (1987). This limitation con-
fines Article III courts to deciding matters as to which
‘there is a “presently existing dispute.” Id. at 364. The
courts of appeals, like other courts established under
Article III, may not issue purely advisory opinions on
legal isues, no matter how interesting or important they
may believe those issues to be. See, e.g., Correspondence
of the Justices (Aug. 8, 1793), reprinted in HART AND
WECHSLER’S THE FEDERAL COURTS AND THE FEDERAL
SYSTEM 66-67 (3d ed. 1988) ; Hayburn’s Case, 2 U.S. (2
Dall.) 409, 410 n.(a) (1792). Cases that have over time
lost their character as “present, live controvers[ies]” are
moot and beyond the limited power that Article III con-
fers upon the federal judiciary. Hall v. Beals, 396 U.S.
45, 48 (1969).

The narrow “capable of repetition, yet evading review”
exception to the mootness doctrine applies only to the rare
situation in which a case or controversy, although form-
ally ended, remains alive in substance. The exception
arises only-when-two conditions are met: “(1) the chal-
lenged action [is] in its duration too short to be fully
litigated prior to its cessation or expiration, and (2)
there [is] a reasonable expectation that the same com-
plaining party [will] be subjected to the same action
again.” Weinstein v. Bradford, 423 U.S. 147, 149 (1975)
(per curiam) ; see Murphy v. Hunt, 455 U.S. 478, 482
(1982) (per curiam). Neither of those conditions exists
here.

The court of appeals’ application of the “capable of
repetition” exception was incorrect as a matter of law
and squarely in conflict with decisions of three other
courts of appeals that have addressed the same situation.
Moreover, the court’s refusal to vacate its opinion and the
judgment of the district court conflicts square!’ with this
Court’s mandate in Munsingwear.

7

I. THE COURT OF APPEALS’ HOLDING THAT A
CONTEMPT JUDGMENT IS NOT MOOT AFTER
EXPIRATION OF THE GRAND JURY CONFLICTS
WITH DECISIONS IN THREE OTHER CIRCUITS.

A. The Court of Appeals’ Decision Conflicts with the
Ninth Circuit’s Decision in Jn re Grand Jury
Proceedings.

Under identical circumstances—an appeal by a grand
jury witness held in contempt, ordered confined for the
life of the grand jury, and released pending appeal—-
the Ninth Circuit concluded that the case was moot,
holding that “the government cannot show that the lim-
ited duration of the contested action is likely to frustrate
effective judicial review.” In-re Grand Jury Proceedings,
863 F.2d 667,669 (9th Cir. 1988).

The court below purported to distinguish the Ninth
Circuit decision as follows:

The Ninth Circuit found that the capable of repe-
tition exception did not apply to a contempt order
covered by the “recalcitrant witness” statute, 28
U.S.C. § 1826(b) (1982). ... This statute provides
for an expedited appeal process, but only in cases
where the appeal is from an order of confinement.
As appellant was not confined pursuant to the order
of contempt, his appeal was subject to the inevitable
delays inherent in the typical appellate process.

App. la-2a (emphasis in original). But this purported
distinction is simply incorrect. The witness in the Ninth
Circuit case, contrary to what the court below supposed,
had not been confined.’ The Ninth Circuit did not hold

5 Although it is not apparent from the face of the Ninth Circuit’s
decision that the witness in that case was released, the record
reveals that she was not confined pending appeal.

8

that the particular contempt order before it was covered
by the expedited procedures prescribed by 28 U.S.C.
§ 1826(b), which mandates a 30-day time limit for an
appeal from a contempt judgment only when the witness
is confined.*° The court instead observed that § 1826(b)
provides a means of obtaining prompt review of contempt
orders generally, so that “if [the witness] is called to
testify again, her claims can be litigated in a timely
fashion.” 863 F.2d at 669 (emphasis added). The cir-
cumstances that led the Ninth Circuit to find the case
moot in In re Grand Jury Proceedings were precisely
those here; in both cases, the witnesses were held in con-
tempt, ordered confined, and released pending appeal.

The court below was also mistaken in concluding, con-
trary to the Ninth Circuit, that appeals from grand jury
contempt orders not involving confinement are “subject to
the inevitable delays inherent in the typical appellate
process.” App. 2a. In fact, such orders by law are not
subject to the “typical appellate process”; the courts of
appeals are “obliged to ‘expedite the consideration of any
action brought under . . . section 1826,’” including those
in which the recalcitrant witness is released pending ap-
peal. In re Sealed Case, 829 F.2d 189, 190 (D.C. Cir.
1987) (per curiam) (emphasis added) (quoting 28
U.S.C. § 1657(a)); see 28 U.S.C. $1657(a). This ex-
pedition ensures that grand jury contempt orders not
involving confinement generally can be fully litigated
during the life of the grand jury.’

$ Section 1826(b) provides that “[a]ny appeal from an order of
confinement under this section shall be disposed of as soon as prac-
ticable, but not later than thirty days from the filing of such
appeal.” 28 U.S.C. §1826(b) (emphasis added).

7 An ordinary ,rand jury has a term of up to 18 months, and the
district court can extend the term for up to an additional six
months. Fed. R. Crim. P. 6(g). A special grand jury has a usual

9

B. The Court of Appeals’ Decision Conflicts with the
Eighth Circuit’s Decision in Larson.

The opinion of the court below does not address the
second prong of the “capable of repetition” doctrine at all.
But to the extent that the court considered the issue and
found that “there [is] a reasonable expectation that {Roe
will] be subjected to the same action again,” Weinstein,
423 U.S. at 149, its decision conflicts with the Eighth
Circuit’s in In re Grand Jury Proceedings (Larson), 785
F.2d 629 (8th Cir. 1986). Under practically indistin-
guishable cireumstances—an appeal by a grand jury wit-
ness as to whom there was no basis to believe that she
would be subpoenaed before a new grand jury—the Eighth
Circuit concluded that there was no reasonable expecta-
tion that the witness would be subjected to the same ac-
tion again.’ Accordingly, the court held that “the ‘cap-

term of 18 months, and with extensions may have a term of up to
36 months. 18 U.S.C. § 3331.

The grand jury in this case sat for a total of two years. It was
due to expire in January 1989. It was extended six months to June
2, 1989, at which time its term was allowed to expire.

8In In re Grand Jury Proceedings (Klayman), 760 F.2d 1490
(9th Cir. 1985), the government “stated unequivocally” that it
would call the grand jury witness to testify at an upcoming trial.
Id. at 1492. Accordingly, the court of appeals held that the second
prong of the “capable of repetition” exception was satisfied, because
“the underlying dispute is capable of repetition among these par-
ties.” Jd. Even so, the court held that the exception was inapplica-
ble and the case moot because the dispute was “not likely to escape
review,” in light of the opportunity the parties would have at trial
to file motions in limine and to appeal from adverse determina-
tions. Jd.

Similarly, in In re Grand Jury Proceedings, 863 F.2d 667 (9th
Cir. 1988), the second prong of the “capable of repetition” excep-
tion was held satisfied because the government informed the court
“that there is a substantial likelihood that a new grand jury will
soon investigate the same subject matter and will again attempt to

10

able of repetition, yet evading review’ exception is not ap-
plicable and . . . the appeal has thus become moot.” /d.
at 631.°

The court of appeals’ holding here not only conflicts
with the Eighth Circuit’s, but on the record is plainly
baseless. Petitioner knows of no suggestion in the record
that he will be subpoenaed by a new grand jury. The
government’s agreement that the case is moot strongly
confirms that it has no intention of causing a new sub-
poena to issue. The court below simply had no basis for
concluding (if it considered the question at all) that Roe
would be “subjected to the same action again.”

C. The Court of Appeals’ Decision Conflicts with the
Fifth Circuit’s Decision in Leppig.

The court of appeals’ decision also conflicts with the
Fifth Circuit’s decision in Leppig v. Martin, 386 F.2d
190 (5th Cir. 1967) (per curiam). A witness there was
held in contempt for failure to answer questions before a
Florida grand jury. He obtained a writ of habeas corpus
from the federal district court. On appeal by the govern-
ment, the term of the grand jury expired. The Fifth
Circuit held that “the appeal has become moot and is
dismissed.” Jd. There is no meaningful distinction be-
tween Leppig and this case.

call [the witness] to the stand.” Jd. at 668; see id. at 669. Again,
however, the court held the case moot because the government failed
to show that “the limited duration of the contested action is likely
to frustrate effective judicial review.” Jd.

® The court below cited Larson to support its conclusion that the
first prong of the “capable of repetition” exception was satisfied
in this case, but it ignored Larson’s contrary holding on the second
prong of the exception. App. la.

11

Il. MUNSINGWEAR MANDATES THAT THE OPIN-
IONS OF THE COURTS BELOW BE VACATED.

The court of appeals’ refusal to vacate its own opinion
as moot and to direct the district court to vacate the con-
tempt judgment conflicts directly with this Court’s direc-
tion in Munsingwear. That case declared that

[t]he established practice of the Court in dealing
with a civil case from a court in the federal system
which has become moot while on its way here or
pending our decision on the merits is to reverse or
vacate the judgment below and remand with a di-
rection to dismiss.

Munsingwear, 340 U.S. at 39; see Duke Power Co. V.
Greenwood County, 299 U.S. 259, 267 (1936). The Court
explained that vacating the lower court opinions “elimi-
nates a judgment, review of which was prevented through
happenstance. When that procedure is followed, the rights
of all parties are preserved; none is prejudiced by a de-
cision which in the statutory scheme was only prelimi-
nary.” 340 U.S. at 40. This Court has consistently fol-
lowed the procedure that Munsingwear requires. See, e.g.,
Burke, 479 U.S. at 365. When the courts of appeals have
disregarded the prescribed procedure, this Court has not
hesitated to grant certiorari and summarily vacate the
judgments below. See, e.g., Alabama v. Davis, 446 U.S.
903 (1980); Great Western Sugar Co. v. Nelson, 442
U.S. 92, 93-94 (1979).

The court of appeals ignored the Munsingwear rule in
refusing to vacate its opinion. The court’s disregard of
Munsingwear is particularly remarkable because at the
time it rendered its opinion, it was well aware from the
district court’s judgment, App. E, that the grand jury
had expired four days earlier. Despite this knowledge,
the court nevertheless issued an advisory opinion on is-
sues that had clearly become moot.

12

CONCLUSION

For the foregoing reasons, Petitioner respectfully sub-
mits that the petition for writ of certiorari should be
granted, the judgment of contempt summarily reversed,
and the case remanded to the court of appeals with in-
structions to order all opinions and judgments in this
matter vacated as moot.

Respectfully submitted,

ROBERT P. WATKINS
Counsel of Record

JOHN D. CLINE

PAUL BUTLER
WILLIAMS & CONNOLLY
839 17th Street, N.W.
Washington, D.C. 20006
(202) 331-5000

October 26, 1989 Attorneys for Petitioner

APPENDICES

*s

la

APPENDIX A

UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

SEPTEMBER TERM, 1988
No. 89-5045
IN RE: SEALED CASE

(Filed June 27, 1989)

BEFORE: Mikva, Silberman and Williams, Circuit
Judges
ORDER

Upon consideration of Appellant’s Motion to Vacate
the Opinion of the Court on the Grounds of Mootness, and
the Memorandum of Points and Authorities submitted in
support thereof, the Motion is hereby DENIED.

Although the term of the grand jury expired June 2,
1989, four days before the opinion was issued, we do not
find the case to be moot. The case falls within the “cap-
able of repetition but evading review” exception to the
mootness doctrine. See Jn re Sealed Case, No. 89-5102.
slip op. at 10 n.6 (D.C. Cir. June 27, 1989) (ruling on
mootness in a case concerning other subpoenas issued by
this grand jury); Zn re Grand Jury Proceedings (Lar-
son), 785 F.2d 629, 631 (8th Cir. 1986) (due to limited
duration of grand jury’s term, contempt issues, “in the
absence of confinement or commitment,” are capable of
repetition yet evading review).

The Ninth Circuit found that the capable of repetition
exception did not apply to a contempt order covered by
the “recalcitrant witness” statute, 28 U.S.C. § 1826(b)

2a

(1982). In re Grand Jury Proceedings, 868 F.2d 667,
669-70 (9th Cir. 1988). This statute provides for an ex-
pedited appeal process, but only in cases where the ap-
peal is from an order of confinement. As appellant was
not confined pursuant to the order of contempt, his ap-
peal was subject to the inevitable delays inherent in the
typical appellate process.

Accordingly, the Motion to Vacate on the Ground of
Mootness is denied.

So ordered.

FOR THE CourRT:
CONSTANCE L. DUPRE
Clerk

By: /s/ Robert A. Bonner
ROBERT A. BONNER
Deputy Clerk

~~, 3a
APPENDIX B

UNITED STATES COURT OF APPEALS
DISTRICT OF COLUMBIA CIRCUIT

No. 89-5045
IN RE SEALED CASE
Argued April 3, 1989
Decided June 6, 1989

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

(Civil Action No. 88-00394)

Before MIKVA, SILBERMAN and WILLIAMS, Cir-
cuit Judges.

Opinion for the Court filed by Circuit Judge STE-
PHEN F. WILLIAMS.

Concurring opinion filed by Circuit Judge MIKVA.
STEPHEN F. WILLIAMS, Circuit Judge:

On October 6, 1988 the United States Attorney had ap-
pellant served with three grand jury subpoenas duces
tecum, addressed to him as custodian of the corporate
records of three different corporations. Appellant form-
ally notified the U.S. Attorney that he would not comply
with two of the subpoenas, asserting that producing those
records would violate his Fifth Amendment privilege
against self-incrimination. Upon application by the gov-
ernment, the district court ordered him to comply with
the subpoenas and, when he refused, held him in con-
tempt. In re Two Grand Jury Subpoenas Duces Tecum
Dated October 6, 1988, Misc. No. 88-394 (D.D.C. Feb.
10, 1989) (compliance orders), (D.D.C. Mar. 2, 1989)
(judgment and order of contempt).

4a

Appellant recognizes that the Fifth Amendment priv-
ilege does not apply to records of a “collective entity.”
The exception started with the proposition that a corpora-
tion could not invoke the privilege to resist a demand for
its records, Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50
L.Ed. 652 (1906), but extends to an agent of a corpora-
tion, even-where-the content of corporate records sought
might expose him to individual criminal liability, Wilson
v. United States, 221 U.S. 361, 31 S.Ct. 538, 55 L.Ed.
771 (1911) (subpoena directed to corporation) ; Dreier v.
United States, 221 U.S. 394, 31 S.Ct. 550, 55 L.Ed. 784
(1911) (subpoena directed to corporate custodian). The
doctrine also applies to non-corporate collective entities,
including even a small partnership, see Bellis v. United
States, 417 U.S. 85, 94 S.Ct. 2179, 40 L.Ed.2d 678
(1974), and a labor union, see United States v. White,
322 U.S. 694, 64 S.Ct. 1248, 88 L.Ed. 1542 (1944).

Even for records of an individual, the privilege applies
in only a limited fashion. It does not cover the contents
of any voluntarily prepared records, including personal
ones. United States v. Doe, 465 U.S. 605, 104 S.Ct. 1237,
79 L.Ed.2d 552 (1984). On the other hand, subject to
the collective entity doctrine, the “act of production” of
incriminating evidence may be protected by the Fifth
Amendment where that act would have independent testi-
monial significance, as by manifesting the holder’s ac-
knowledgement of the exisience of the documents or his
custody or control over them, or his belief that they fit
the description in the subpoena. Fisher v. United States,
425 U.S. 391, 410-11, 96 S.Ct. 1569, 1581, 48 L.Ed.2d 39
(1976); Doe, 465 U.S. at 614 n. 13, 104 S.Ct. at 1243
n. 13; see also Braswell v. United States, USS. ;
108 S.Ct. 2284, 101 L.Ed.2d 98 (1988) (finding act of
production doctrine inapplicable to records of collective
entity).

The first of the disputed subpoenas relates to records
of an entity we will call Corporation A. As to it, appel-

5a

lant’s primary contention is that, although he is president,
chief executive officer and majority shareholder of the
corporation, its designation of another employee as its
offcial custodian of records means that appellant cannot
be considered a custodian. Further, he claims that the
records are personal rather than corporate. We reject
both claims and so far as Corporation A is concerned
uphold the district court’s order to compel production
and its later contempt citation.

The second of the disputed subpoenas relates to what
we will call Entity B. In fact it appears to be little
more than a name, and we find insufficient evidence in the
record that it is a corporation—or indeed any other kind
of collective entity. Accordingly, we reverse the district
court’s order -and contempt citation so far as these rec-
ords are concerned.

The grand jury which issued the subpoenas is investi-
gating allegations of income tax evasion and conspiracy
to defraud the government of taxes. The U.S. Attorney
has advised both appellant and Corporation A that they
are targets of the grand jury’s investigation. Further
references to the facts are necessarily somewhat vague.
To protect the secrecy of the grand jury investigation,
we must refrain from mentioning the individual or the
entities named in the subpoenas. As the government sum-
marized its evidence in a statement filed ex parte and
reviewed in camera by both the district court and this
court, even the appellant is unaware of what facts the
grand jury has uncovered. See Jn re Sealed Case, 832
F.2d 1268, 1281 (D.C.Cir.1987) (approving such sub-
missions when necessary to protect grand jury secrecy).

I.

The first subpoena was directed to the appellant as
“Custodian of Records” for Corporation A. It requested
him to produce all bank records relating to a specified
account in its name at a Maryland savings and loan asso-

6a

ciation; in addition, he was ordered to testify before the
grand jury, but only for the limited purpose of authen-
tication.1 The corporate employee who officially holds the
position of custodian has testified that he was unable to
find any evidence of the savings account. Ex parte Ap-
pendix of the United States (“Ea Parte App.”) 27.

Appellant does not deny that Corporation A is a col-
lective entity. He asserts only that he is not custodian
of the records for purposes of the collective entity excep-
tion and that the particular records sought are personal
rather than corporate.

Appellant Can Be Considered a Custodian of Any Rec-
ords of Corporation A in His Possession or Control.

Appellant’s claim that he is relieved of the burdens
of the collective entity doctrine by the corporation’s des-
ignation of another, and not himself, as custodian, finds
no support in the doctrine’s principle or the relevant
eases. The doctrine rests on the combination of the en-
tity’s having no collective privilege and the custodian’s
having voluntarily assumed a duty to hold the records
“in a representative capacity ... on behalf of the group.”
Bellis, 417 U.S. at 89, 94 S.Ct. at 2183; see also Wilson,
221 U.S. at 380, 31 S.Ct. at 544 (custodian may have
“voluntarily assumed a duty which overrides his claim of
privilege”); White, 322 U.S. at 699, 64 S.Ct. at 1251
(official records and documents are held “in a representa-
tive rather than in a personal capacity”). Nothing in this

1 Neither of the subpoenas states that the testimony requested
will be so limited, but the government concedes that appellant could
refuse on Fifth Amendment grounds to testify further. See Brief
for the United States 26-28; Braswell, 108 S.Ct. at 2293 (person
producing documents before grand jury in capacity of corporate
custodian may be required to identify and authenticate records
in so far as this merely makes explicit what is implicit in the pro-
duction itself); Curcio v. United States, 354 U.S. 118, 127 n. 6 &
128, 77 S.Ct. 1145, 1151 n. 6 & 1511-12, 1 L.Ed.2d 1225 (1957)
(further testimony could violate Fifth Amendment).

7a

theory suggests that the doctrine can apply only to one
representative for a particular entity, or only to a repre-
sentative officially designated as such by the entity.

Besides having no grounding in the doctrine’s theory,
any such formalistic requirement would undermine one of
the policy values regularly invoked on its behalf—that of
facilitating the enforcement of criminal laws against col-
lective organizations and their employees. See, e.g., Bras-
well, 108 S.Ct. at 2294 & n.9. Under appellant’s theory,
if a corporate officer wished to circumvent the doctrine,
he could simply designate as official custodian a person
ignorant of the critical records’ existence and location.

In fact, the Braswell Court expressly rejected a related
argument. By way of mitigating the effect that his pro-
posed reading of the act of production doctrine might
have on law enforcement, Braswell suggested that if pro-
duction of the documents would tend to incriminate the
subpoenaed agent, the corporation could be allowed to
appoint an alternative agent. Under the proposed expe-
dient, the government could not require the original agent
to aid in the search for the records, as statements to the
surrogate would themselves tend to incriminate. The
Court held that the proposal would unduly hinder access
to the corporate decuments:

[W]here the [originally named] corporate custodian
is likely the only person with knowledge about the
demanded documents[,] the appointment of a surro-
gate will simply not ensure that the documents
sought will ever reach the grand jury room; the ap-
pointed custodian will essentially be sent on an un-
guided search.

Braswell, 108 S.Ct. at 2294. Appellant’s proposal here
would equally circumvent the collective entity rule. Ac-
cordingly, we interpret “custodian” to encompass any
agent of the corporation who under ordinary principles
of corporate law has custody or control over corporate
documents.

8a

Second, appellant contends that the phrase “foregone
conclusion” defines the standard by which the govern-
ment must prove his custodianship. As support, he cites
our pre-Braswell decision. In re Sealed Case, 832 F.2d
1268, 1280 (D.C.Cir. 1987). There, contrary to Braswell,
we held that the act of production doctrine encompassed
corporate agents. We went on to say that even if it did
not, the “foregone conclusion” concept should govern res-
olution of factual disputes over custodianship.

The “foregone conclusion” language arose in Fisher
and Doe as a component of the act of production doctrine.
The Court said that where the existence and location of
subpoenaed documents were a “foregone conclusion,” it
could compel production by the party controlling them,
even though the party validly asserted a Fifth Amend-
ment privilege. In such a case, the Court reasoned, the
custodian’s “communication” would add “little or nothing
to the sum total of the Government’s information.”
Fisher, 425 U.S. at 411, 96 S.Ct. at 1581; see also Doe,
465 U.S. at 614 n. 18, 104 S.Ct. at 1243 n. 18; Samuel
A. Alito, Jr., Documents and the Privilege Against Self-
Incrimination, U.Pitt.L.Rev. 27, 49-50 (1986) (reading
“foregone conclusion” reference as relating to govern-
ment’s independent knowledge of records’ existence and
location) ; Comment, The Rights of Criminal Defendants
and the Subpoena Duces Tecum: The Aftermath of
Fisher v. United States, 95 Harv.L.Rev. 683, 686-87
(1982) (same). But once we disassociate the act of pro-
duction doctrine from corporate records, as Braswell
teaches,” it is not clear why any formula associated with
that doctrine should bear upon or define the standard of
proof on any relevant issue.

2 We note that Braswell left open whether the act of production
doctrine might apply to corporate records held by a custodian who
was also the sole employee and officer of the organization. 108 S.Ct.
at 2295 n.11.

9a

The government argues that one should resolve factual
issues relating to custodianship in the same way that
the Supreme Court has resolved the parallel issue of
whether the subject of a subpoena has control over the
records demanded. In McPhaul v. United States, 364
U.S. 372, 379, 81 S.Ct. 138, 142-43, 5 L.Ed.2d 136 (1960),
the Court said that once the government had shown a
“reasonable basis” for believing that the appellant had
the ability to produce the records, the burden shifted to
him to explain or justify his refusal. Similarly, in United
States v. Rulander, 460 U.S. 752, 757, 103 S.Ct. 1548,
1552, 75 L.Ed.2d 521 (1983), the Court referred to Mc-
Phaul as placing on the subpoenaed party “the burden of
production” for the defense that he lacks possession or
control. See also United States v. Lawn Builders of New
England, Inc., 856 F.2d 388, 395 (1st Cir.1988). In view
of appellant’s undisputed role as president, chief execu-
tive officer and major shareholder of Corporation A, the
government clearly has established a reasonable basis for
believing him to have custody of corporate records; he
has produced no evidence to the contrary, despite his op-
portunities to do so in the lower court. Although the
appellant indicated in a responsive memorandum sub-
mitted to the district court that he could produce rebuttal
evidence at an ex parte hearing, see Memorandum in
Opposition to Government’s Application for Orders Di-
recting the Production of Documents Pursuant to Two
Grand Jury Subpoenas Duces Tecum Dated October 6,
1988 1-2, 13, he never offered specific factual assertions,
in affidavits or briefs, ex parte or public, that would tend
to draw in question the normal inferences from his role
in the corporation. Considering the record before us, we
find appellant custodian of the records sought.

The Records Named in the Subpoena are
Corporate Documents.

Appellant also denies that the Maryland savings ac-
count is corporate in nature or under Corporation A’s
control. He notes that the government itself asserts that

10a

funds which should have found their way into |Cor-
poration A’s] corporate bank accounts have been di-
verted into a bank account in [Corporation A’s]
name but not within its control. Rather, during the
time relevant to this investigation that account at
[the] [s]avings & [l]oan had been under the control
of, and the funds within it had been used exclusively
by, [appellant] for non-corporate matters.

Government’s Application for Orders Directing the Pro-
duction of Documents Pursuant to Two Grand Jury Sub-
poenas Duces Tecum Dated October 6, 1988, 4 (version
served on appellant) (emphasis added).

The quoted passage may suggest a lack of relationship
between the corporation and the savings account that is
belied by other government assertions. The account was
maintained in the corporate name, and the savings and
loan was given a copy of Corporation A’s articles of in-
corporation, as well as its correct corporate income tax
identification number. According to the government’s
Statement of Evidence, the funds deposited in the account
were legitimately earned by Corporation A and were
corporate property—until they were allegedly misappro-
priated by appellant. Ex Parte App. 25. Appellant’s
powers as a corporate officer enabled him to determine
which corporate funds should be funneled to the account.

In determining what records are corporate for pur-
poses of the collective entity doctrine, we may start by
noting some conceivable limits that have been rejected.
Although the collective entity exception was based in part
on the state’s power to inspect corporate documents, Bel-
lis, 417 U.S. at 89, 94 S.Ct. at 2183, it is clear that the
records covered are not merely those that the corporation
is required by law to keep.* In Wilson, for example, the

3 Maryland, the state with jurisdiction over Corporation A, pro-
vides that

[elach corporation shall keep correct and complete (1) Books

and records of its accounts and transactions; and (2) Minutes

lla

Court held that the doctrine encompassed letters written
by the corporation’s president in the course of its trans-
actions, just as much as it would corporate ledgers and
minute books. 221 U.S. at 377, 31 S.Ct. at 543.

Wilson also states that records do not cease to be cor-
porate merely because they show the corporation to be
the victim of the custodian rather than itself the per-
petrator of offenses. In considering private corporations,
the Court said that it was no defense for the custodian to
say that the corporation was not the subject of the in-
vestigation or charged with any crimes. 7d. at 385, 31
S.Ct. at 546. Perhaps more directly on point for our pur-
poses, it explained that a public official who “embezzled
the public moneys and falsified the public accounts” could
not on that basis “seal” the relevant documents from
prosecuting authorities under the name of the privilege
against self-incrimination. Jd. at 380, 31 S.Ct. at 544.
Thus we may confidently reject the suggestion that a
corporate officer may escape the doctrine merely by show-
ing that he used the records to cheat the corporation.

As the collective entity rests upon an “agency ration-
ale,” see Braswell, 108 S.Ct. at 2291, it is natural to look
to agency law for analogies to determine whether docu-
ments are those of the collective entity. But the issues
with which agency law typically wrestles—the liability of
the agent to the principal, and of the principal to third
parties for acts of the agent—do not present precise
models for this question. It is one thing to know that an
agent will be liable to the principal for profits realized
on unauthorized transactions, see Harold Reuschlein &
William Gregory, Agency and Partnership 128-29 (1979),
and that a principal has some right to use force to re-
cover chattels entrusted to an agent, id. at 127, but this

of the proceedings of its stockholders and board of directors.

Md. Corps. & Ass’ns Code Ann. § 2-111(a) (1985).

- l2a

does not establish ipso facto that any document created by
an agent for purposes of his defalcations is on that ac-
count the principal's document. Nor can the doctrines
determining whether a principal is bound in transactions
with third parties be adopted wholesale. For instance,
assuming appellant misrepresented the character of the ac-
count to the savings and loan association (but not to the
government), the misrepresentations might well bind the
corporation in a dispute between it and the association on
the theory of apparent authority; but the logic of such a
finding would not self-evidently carry over to the govern-
ment’s benefit here. The concepts of implied or incidental
authority seem more analogous. For example, even if ap-
pellant did not have explicit corporate authorization to
open an account in Corporation A’s name and deposit
corporate funds in it, as president and chief operating
officer he surely had incidental authority to do so. See
Reuschlein & Gregory at 37 (“conferral of authority to
... Occupy a particular position must be taken as bestow-
ing authority to do all the things normally incident to...
the occupancy of the particular status”’).

The question we confront is slightly different. Instead
of determining whether appellant was authorized by a
corporate principal to act as he did, we must decide
whether an agency relationship exists between appellant
and Corporation A with respect to the Maryland savings
account. Without trying to generate any definitive test,
we conclude that here the records are corporate for pur-
poses of applying the collective entity doctrine. Only one
specific factor suggests the opposite—the assertion that
they were used by appellant to steal from the corporation;
Wilson makes clear that that is insufficient. The govern-
ment’s conclusory statements quoted above, at least as
used by appellant, beg the question. For example, the
contention that the account was not within the corpora-
tion’s “control” appears inextricable from the ultimate
one now before us. (In so far as the assertion merely

.. 18a

repeats the point of appellant’s misuse, of course it adds
nothing. )

Apart from appellant’s alleged use of the account for
larceny or for other illegal purposes, the records are cor-
porate. The account is in the corporation’s name, is run
by the corporation’s president and chief executive officer,
and is funded with corporate property.‘ These facts af-
ford a reasonable basis for concluding that any records
relating to the savings account in appellant’s custody are
held on behalf of Corporation A; neither their contents
nor their production by him is privileged.

Il.

Appellant received a second subpoena duces tecum from
the grand jury directed to him as “Custodian of Records”
of Entity B. The subpoena was quite extensive, directing
appellant to produce the following:

1. Articles of incorporation and minutes of corpo-
rate meetings. 2. Correspondence to and from [En-
tity B]. 3. Contracts to which [Entity B] is a party.
4. Bank records for all accounts, e.g. statements, can-
celed checks, duplicate deposit tickets, debit and
credit memoranda, confirmations of wire transfer,
signature cards and account agreements/contracts.
5. Accounting records, e.g., ledgers, journals, work-
papers. 6. Leases, [Entity B’s] personnel records,
telephone bills and toll records. 7. Tax returns and
financial statements.

Subpoena to Testify Before Grand Jury, Oct. 6, 1988,
App. 4. Appellant declined to comply with the subpoena
on the same Fifth Amendment grounds that he cited with
respect to Corporation A’s documents. See Letter from

4*cf. United States v. MacKey, 647 F.2d 898 (9th Cir. 1981)
(diary and calendar used by corporate executive to record meetings
and transactions conducted as executive, as well as other events,
held corporate for privilege purposes).

| ceremmenentetteel

l4a

Appellant’s Counsel, Nov. 2, 1988, App. 7-9. Again, the
government responded that the collective entity doctrine
controlled.

Unlike the case of Corporation A, this issue depends
upon whether Entity B actually is a “collective entity.”
By its very terms, the threshold requirement for the ap-
plication of the collective entity rule is that the appel-
lant is acting as an agent of a collective organization that
engages in “organized, institutional activity.” White, 322
U.S. at 701, 64 S.Ct. at 1252. As we noted above, the
entity need not be a corporation; such collectives as a
partnership or labor union suffice.

For classifying a non-corporate entity, the Court in
Bellis offered the following guidance:

[The collective entity] analysis presupposes the ex-
istence of an organization which is recognized as an
independent entity apart from its individual members.
The group must be relatively well organized and
structured, and not merely a loose, informal associa-
tion of individuals. It must maintain a district set
of organizational records, and recognize rights in its
members of control and access to them. And the
records subpoenaed must in fact be organizational
records held in a representative capacity.

417 U.S. at 92-98, 94 S.Ct. at 285-86. At least outside
the corporation, which is perhaps necessarily a collective
entity, see id. at 100, 94 S.Ct. at 2189, the language seems
to require more than one person to whom (or among
whom) obligations may run.

The Court in Bellis used these general rules to find the
three-person partnership before it to be a collective entity.
It relied on a variety of facts, including the existence of
a bank account in the partnership’s name, stationery with
the firm’s letterhead, specific examples of partners hold-
ing the firm out to third parties as an independent in-
stitution, the number of employees other than partners

l5a

(six), the filing of separate partnership tax forms, and
statutory provisions that treated a partnership as a dis-
tinct entity in other contexts. Jd. at 96-97, 94 S.Ct. at
2187. Thus, the Court concluded that “the partnership
here did have an established institutional identity inde-
pendent of its individual partners.” Jd. at 95, 94 S.Ct. at
2187. It noted that the case required it to explore the
“outer limits” of collective entity analysis. Jd. at 94, 94
S.Ct. at 2186.

We can find in this record no reasonable basis for treat-
ing Entity B as a collective one. It appears to be nothing
more than a name under which appellant shuffles funds.
Although the bank account sought by the government was
opened as a corporate account, with a designated presi-
dent, vice-president and secretary, and with purported
corporate bank resolutions filed, none of the persons
named appears to have done more than lend an address
or perform ministerial acts at appellant’s direction. See
Statement of Evidence, Ex Parte App. 4-10. There is no
evidence that anyone executed articles of incorporation or
other rudimentary constitutive documents, much less filed
any such papers with any state. The word “Limited” ap-
pears at the end of Entity B’s name, suggesting that it is
a corporation, but nothing substantiates that except as
the items mentioned above may do so. There seems to be
no one within Entity B, other than appellant himself, to
whom the sort of obligations contemplated by Bellis might
run.

In view of the absence of any real collective entity, the
government argues that Entity B should be treated as a
collective organization because appellant has held it out
as a corporation to third parties. The government does
not claim the entity to be a de facto corporation—wisely,
as the focus of that doctrine, in jurisdictions that apply
it, is upon the existence of a good faith effort to incorpo-
rate. See 8 Fletcher’s Cyclopedia of the Law of Private
Corporations §§ 3777, 3796-3834 (1982). Rather, the

l6a

government cites the concept of corporation by estoppel—
the doctrine that when an entity has been held out as a
corporation to a third party, neither the entity nor the
third party may deny the existence of the corporation in
subsequent litigation. See Cranson v. International Busi-
ness Machines Corp., 234 Md. 477, 200 A.2d 33 (1964) ;
Fletcher’s Cyclopedia at § 3889.

We seriously doubt whether the doctrine of corporation
by estoppel can ever establish a corporation for Fifth
Amendment purposes. The estoppel depends on dealings
between those holding the entity out as a corporation and
the third parties to whom such representations are made.
See Fletcher's Cyclopedia at § 3898 (the doctrine “cannot
apply .. . to one who has not dealt with the association,
or in any way recognized it as having a corporate exist-
ence, or in any way participated in holding it out as a
corporation’). For example, creditors who have dealt
with an entity as a corporation may be estopped to hold
individuals personally liable for its debts. See, eg.,
Cranson v. International Business Machines Corp., 234
Md. 477, 200 A.2d 33 (1964). Thus it serves to protect
reasonable expectations or reliance. Cf. Fletcher’s Cyclo-
pedia at § 3907 (noting general requirement of reliance
by party asserting estoppel). But it seems improbable
that the government as investigator will have engaged in
dealings with the “entity” that give rise to the sort of
expectations protected by the estoppel. More important,
it is hard to see any principal link between the corpora-
tion by estoppel and the collective entity doctrine. The
latter arises out of a person’s having voluntarily assumed
duties to act for an entity that does not enjoy the protec-
tion of the privilege against self-incrimination. Unless
there actually are persons within the entity to whom the
duties described by Bellis can run, it is hard to see why
misrepresentations to outsiders can make the doctrine ap-
plicable. Here, in any event, there is no claim that ap-
pellant or Entity B implicitly or explicitly represented to

—

17a

the government that it was a corporation, so the bare
bones of the doctrine are not satisfied.

It is quite true that in Bellis the Court noted that the
partnership had “in general, held itself out to third par-
ties as an entity with an independent institutional iden-
tity.” 417 U.S. at 97, 94 S.Ct. at 2187. But we do not
read the reference as by any means adopting a doctrine
of corporation (or “entity’”) by estoppel. The “holding
out” was certainly an indicium that the persons involved
acted as a collective entity, but that hardly indicates that
one person’s pretense of corporate status, in relations with
a bank over one account, could turn that person and a
few minions into a corporation or other collective entity.

The government cites a number of cases in support of
its pronosed use of estoppel, but we believe they establish
a good deal less. In re Two Grand Jury Subpoenae Duces
Tecum Dated August 21, 1985, 793 F.2d 69, 72 (2d Cir.
1986), is similar to Bellis in that the court mentions,
among many other elements, that the entity it finds to be
collective had held itself out as a multi-person law firm.
Similarly, while the court in United States v. Theodore,
479 F.2d 749 (4th Cir.1973), said that a partnership was
estopped to deny “the existence and viability of its cor-
porate entity,” 7d. at 753, this was simply a response to a
claim that its failure to file articles of association pre-
vented it from becoming a valid corporation. (The court
assumed that a partnership did not constitute a collec-
tive entity.) The opinion does not reveal any other fact
that might militate at all against a finding of collective
entity. In re Subpoena Duces Tecum to Gold Depository
Unlimited of America, 436 N.Y.S.2d 794, 106 Misc.2d
992 (N.Y.Sup.Ct.1980). which follows Theodore with vir-
tually no discussion, does not indicate how the entity
would measure up under the Bellis criteria.

Thus the record does not establish a reasonable basis
for treating Entity B as a collective entity. In the ab-

18a

sence of such a showing (or proof by the government that
the possession, existence and authentication of the rec-
ords is a “foregone conclusion,” see Doe, 465 U.S. at 614
n. 13, 104 S.Ct. at 1243 n. 13), appellant may invoke his
privilege against self-incrimination. We reverse the dis-
trict court’s order compelling appellant to comply with
this subpoena and reverse the corresponding portion of
its contempt order.

So ordered.
MIKVA, Circuit Judge, concurring:

I agree with the decision and thoughtful opinion of my
colleagues. I write separately because I am troubled by
the effort made by the government (and analyzed by the
court) to apply an estoppel doctrine to the question of
whether Entity B is a collective entity not entitled to
claim the privilege against self-incrimination. My col-
leagues question “whether the doctrine of corporation by
estoppel can ever establish a corporation for Fifth Amend-
ment purposes.” At 90. I think that the answer is ap-
propriate, but that the question is not.

I find the government’s argument more confusing than
illuminating. It is clear that Entity B never held itself
out to the government to be a corporation; if the only
applicable doctrine is “estoppel” that indeed ends the
inquiry. But the government is seeking to vindicate the
public interest, rather than any victim of an estoppel.
A more appropriate inquiry would be whether an entity
taking the benefits of the corporate form expressly or
impliedly “waives” the privilege of non-production of
documents. Such a doctrine of waiver better fits the fact-
situations that arise in this Fifth Amendment thicket.
But since the government did not claim such a waiver
here, and since the facts seem not to sustain such a hold-
ing, the result ordained by my colleagues would be the
same.

19a

APPENDIX C

Order, In the Matter of Two Grand Jury Subpoenas
Duces Tecum Dated October 6, 1988, Misc. No. 88-0394
(D.D.C. Feb. 10, 1989) (Under Seal)

[Lodged Under Seal with Cierk, United States Supreme
Court]

20a
APPENDIX D

Order, In the Matter of Two Grand Jury Subpoenas
Duces Tecum Dated October 6, 1988, Misc. No. 88-0394
(D.D.C. Feb. 10, 1989) (Under Seal)

[Lodged Under Seal with Clerk, United States Supreme
Court]

2la
APPENDIX E

Judgment and Order of Contempt, Jn the Matter of Two
Grand Jury Subpoenas Duces Tecum Dated October 6,
1988, Misc. No. 88-0394 (Under Seal) (D.D.C. Mar. 2,
1989)

[Lodged Under Seal with Clerk, United States Supreme
Court]

22a
APPENDIX F

UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1988
D.C. Mise. No. 88-0394

No. 89-5045
IN RE: SEALED CASE

[Filed Jun. 6, 1989]

APPEAL FROM THE UNITED STATES DISTRICT
COURT FOR THE DISTRICT OF COLUMBIA

Before: MIKVA, SILBERMAN and WILLIAMS, Cir-
cuit Judges
JUDGMENT
This cause came on to be heard on the record on ap-
peal from the United States District Court for the Dis-
trict of Columbia and was argued by counsel. On con-
sideration thereof, it is

ORDERED and ADJUDGED, by the Court, that the
orders and judgment of the District Court appealed from
in this cause are hereby affirmed in part and reversed
in part, in accordance with the Opinion for the Court

filed herein this date.
Per Curiam

FOR THE COURT:

/s/ Constance L. Dupre
CONSTANCE L. DUPRE
Clerk
Date: June 6, 1989

Opinion for the Court filed by Circuit Judge Williams.
Concurring opinion filed by Circuit Judge Mikva.

28a

APPENDIX G

UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1988
Civil Action No. 88-00394
No. 89-5045
IN RE: SEALED CASE

[Filed August 29, 1989]

BEFORE: Mikva, Silberman and Williams, Circuit
Judges
ORDER
Upon consideration of petitioner’s petition for rehear-
ing, filed July 21, 1989, it is

ORDERED, by the Court, that the petition is denied.
Per Curiam
FOR THE COURT:
CONSTANCE L. DUPRE
Clerk

By: /s/ Robert A. Bonner
ROBERT A. BONNER
Deputy Clerk

24a

APPENDIX H

UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1988
Civil Action No. 88-00394

No. 89-5045
IN RE: SEALED CASE

[Filed August 29, 1989]

BEFORE: Wald, Chief Judge; Robinson, Mikva, Ed-
wards, Ruth B. Ginsburg, Silberman,
Buckley, Williams, D. H. Ginsburg and
Sentelle, Circuit Judges

ORDER

Petitioner’s Suggestion For Rehearing En Banc has
been circulated to the full Court. No member of the
Court requested the taking of a vote thereon. Upon con-
sideration of the foregoing it is

ORDERED, by the Court en banc, that the suggestion
is denied.

Per Curiam
FOR THE COURT:

CONSTANCE L. DUPRE
By: /s/ Robert A. Bonner

ROBERT A. BONNER
Deputy Clerk

25a
APPENDIX I

UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 89-5045
(C.A. No. 00394)

(UNDER SEAL)
IN RE SEALED CASE

RESPONSE TO MOTION TO VACATE
OPINION ON GROUNDS OF MOOTNESS

The United States of America, appellee, agrees that the
opinion of the Court must be vacated and this case re-
manded to the district court with directions to vacate the
contempt citation. Jn re Grand Jury Proceedings, 863
F.2d 667 (9th Cir. 1988) ; United States v. Munsingwear,
340 U.S. 36 (1950).

Respectfully submitted,

/s/ Jay B. Stephens
JAY B. STEPHENS
United States Attorney

/s/ Michael W. Farrell
MICHAEL W. FARRELL
Assistant United States Attorney

‘s/ David Eisenberg
DAVID EISENBERG
Assistant United States Attorney

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385020_0523%3A1. Public record. Not legal advice.