Petition for Writ of Certiorari — Kiesel Co. v. Householder

3 ,. 2 ) Supreme Court, US

3-8 7O ren Ct

NOV 22 1989

JOSEPH F. SPANIO

No. 4 £, SPANIOL, JR,

IN THE

Supreme Court of the United States

OcTOBER TERM, 1989

THE KigSEL COMPANY, INC.,

Petitioner,

VS.

KIMBERLY HOUSEHOLDER, SPECIAL AGENT,

FEDERAL BUREAU OF INVESTIGATION,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

STANLEY M. ROSENBLUM

Davip V. CAPES

ROSENBLUM, GOLDENHERSH,

SILVERSTEIN & ZAFFT, P.C.

7777 Bonhomme Avenue

Fourteenth Floor

Clayton, Missouri 63105

(314) 726-6868

Counsel for Petitioner

November, 1989

St. Louis Law Printing Co., Inc., 1330S Manchester Road 63131 314-231-4477

QUESTIONS PRESENTED

1. Whether anomalous jurisdiction may be employed for pre-

indictment relief from a facially overbroad search warrant, and,

if so, whether the availability of post-indictment review

precludes the exercise of anomalous jurisdiction or a Rule 41(e)

motion to review the warrant prior to indictment.

2. Whether allegations of a pervasive pattern of illegality in

one segment of a company’s business are sufficient to establish

and justify on ‘‘all records’’ search and seizure for all segments

of the business.

LIST OF PARTIES

The parties to the proceedings below were Petitioner, The

Kiesel Company, Inc.,' and Respondent, Kimberly

Householder, Special Agent, Federal Bureau of Investigation.

There are no additional parties to the proceeding before this

Court.

' Pursuant to Supreme Court Rule 28.1, The Kiesel Company, Inc.

identifies the following as its affiliated corporations other than wholly

owned subsidiaries: (1) Kiesel Enterprises, Inc. (parent); (2) Kiesel

Marine Services, Inc; (3) B & C Sales, Inc; (4) L & L Rigging, Inc; (5)

Branch Street Services, Inc; (6) Mississippi River Sand & Materials

Co; (7) Berryfast, Inc; (8) Pala Oil Products, Inc; (9) Patgood, Inc;

(10) American Waste Reclamation Co; (11) Goodsell, Inc; (12) Tool &

Staple Supply Co. of America; (13) Major Cornerstone Supply USA,

Inc; (14) Paramount Hauling; (15) Lindy Farms, Inc; (16) Ridgetop

Farms, Inc; (17) Corkery Fuel & Materials; (18) Falcon Energy, Inc;

(19) Falcon Energy Associates; and (20) J. W., Inc.

TABLE OF CONTENTS

Page

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TABLE OF AUTHORITIES

Page

Cases:

Center Art Galleries v. United States, 875 F.2d 747

, Gs 6. o'b. 0:0 0.540000 ss0nccanseces 6,8,10

Coolidge v. New Hampshire, 403 U.S. 443, 467 (1971).. 7

Floyd v. United States, 860 F.2d 999, 1003 (10th Cir.

Pll. uses saseGaed Mah Euaeeh cae Kenan des 5

G. M. Leasing Corp. v. United States, 429 U.S. 338,

EN ea ee eee chad Oeuae ees 6

Hunsucker v. Phinney, 497 F.2d 29, 32 (Sth Cir. 1974),

cert. denied, 420 U.S. 927 (1975)... ..........5-- 10

In re Harper, 835 F.2d 1273 (8th Cir. 1988) ........... 5

Mr. Lucky Messenger Service, Inc. v. United States,

_ 3) & 1.3 y | s S$ ree 5

Norton v. United States, 867 F.2d 1354, 1360 (11th Cir.

1989), cert. denied, 110 S.Ct. 261 (1989) ......... 9,10

Peiper v. United States, 604 F.2d 1131, 1134 (8th Cir.

EE 0.6 6 bk & 400-0 ke se eek bade eek eehes eens 5

Richey v. Smith, 515 F.2d 1239, 1243 n.10 (Sth Cir.

A es SA Leh ia Sale ea PN eid alaate « 6

Rickert v. Sweeney, 813 F.2d 907 (8th Cir. 1987)....... 8

Stanford v. Texas, 379 U.S. 476, 485 (1965) ........... 7

The Kiesel Company v. Kimberly Householder, 879

Pe GE sss waineenndeesensenen se l

United States v. Offices Known as 50 State Distributing

Co., 708 F.2d 1371 (9th Cir. 1983), cert. denied,

i, SN kn ck eceacekseskas<0ash0 7

Ee

United States v. Leary, 846 F.2d 592, 605 (1988) .......

United States v. Leon, 468 U.S. 897, 104 S.Ct. 3405, 82

SF 5 RRR RR ee Pee

United States v. Roche, 614 F.2d 6 (Ist Cir. 1980) ......

Voss v. Bergsgaard, 774 F.2d 402, 406 (10th Cir. 1985). .

Statutes:

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No.

IN THE

Supreme Court of the United States

OcTOBER TERM, 1989

THe Kreset COMPANY, INC..

Petitioner,

Vs.

KIMBERLY HOUSEHOLDER, SPECIAL AGENT.

FEDERAL BuREAU OF INVESTIGATION

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

The Petitioner, The Kiesel Company, Inc., respectfuly prays

that a writ of certiorari issue to review the judgment and opi-

nion of the United States Court of Appeals for tWfe Eighth Cir-

cuit entered in this proceeding on July 13, 1989.

OPINIONS BELOW

The opinion below of the Court of Appeals is reported as 7he

Kiesel Company v. Kimberly Householder, 879 F.2d 385 (8th

Cir. 1989), and appears in the Appendix hereto as Appendix A.

The opinion of the United States District Court for the Eastern

District of Missouri appears in the Appendix hereto as Appen-

dix B.

tv

JURISDICTION

The judgment of the Court of Appeals for the Eighth Circuit

was entered on July 13, 1989. A timely petition for rehearing en

banc was denied on September 7, 1989, and this petition for cer-

tiorari was filed within 90 days of that date. The Court’s

jurisdiction is invoked under 28 U.S.C. § 1254(1).

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

FOURTH AMENDMENT TO THE UNITED STATES CON-

STITUTION:

The right of the people to be secure in their persons, houses,

papers, and effects, against unreasonable searches and seizures,

shall not be violated, and no Warrants shall issue, but upon pro-

bable cause, supported by Oath or affirmation, and particularly

describing the place to be searched, and the persons or things to

be seized.

RULE 4l(e), FED. R. CRIM. P:

A person aggrieved by an unlawful search and seizure may

move the district court for the district in which the property was

seized for the return of the property on the ground that such

person is entitled to lawful possession of the property which was

illegally seized. The judge shall receive evidence of any issue of

fact necessary to the decision of the motion. If the motion is

granted, the property shall be restored, and it shall not be ad-

missable in evidence at hearing or trial. If a motion for return

of property is made or comes on for hearing in the district of

trial after an indictment or information is filed, it shall be

treated also as a motion to suppress under Rule 12.

—

STATEMENT OF THE CASE

On February 29, 1988, eleven federal agents from the Federal

Bureau of Investigation and Environmental Protection Agency

conducted a search of The Kiesel Company, Inc. (‘‘Kiesel’’).

Kiesel is engaged in the coal, bulk hauling, marine services, oil,

and waste oil business and had, prior to the search, an

unblemished record for the almost 100 years the company and

its predecessor has been in business. The agents seized the entire

premises of Kiesel, interviewed employees, screened all

telephone calls, obtained material samples, and reviewed

thousands of documents at the corporate offices. No office or

file cabinet was immune from the search; all corporate offices

and records of Kiesel were examined and searched.

The search was conducted pursuant to the warrant attached

hereto as Appendix C. The four-page property list attached to

the warrant contains 17 paragraphs authorizing the seizure of

literally hundreds of classes of property. There is no time

limitation as to the materials to be seized; there is no language

limiting the search to specific transactions on any particular

dates; no offense is specifically identified in the warrant; and

the scope of the warrant is not confined to any particular files or

specific categories of documents. The District Court according-

ly found:

The search warrant in this case is nothing more than a

broad statement particularly describing those records likely

to be kept by any enterprise engaged in the oil and waste oil

business. The warrant did not indicate that the documents

sought pertained to any specific transactions, did not iden-

tify the offenses on which the evidence was sought, did not

designate or refer to a time period for which records could

be seized, and finally, did not confine the search to an)

particular files or categories of documents. App. 3 at 5-6.

On March 1, 1988, Kiesel filed a Motion to Quash the Search

Warrant and for Other Relief pursuant to Rule 41(e), Fed. R.

— yen

Crim. P. A hearing was then conducted limited to the narrow

issue of lack of specificity in the warrant and its accompanying

property description. In the hearing, the Government acknow-

ledged that the affidavit supporting issuance of the warrant (the

“*search affidavit’’) had not been served with the warrant and

was not present at the scene during the search and seizure of

Kiesel’s property. Earlier, on the day of the search, Kiesel had

been advised through its counsel that the agent in charge was

determining in her own discretion which items should be seized

under the warrant without use or benefit of the search affidavit.

After finding the warrant to be fatally overbroad, the district

court declined to act under Rule 41(e), and instead, exercised

anomalous jurisdiction to quash the warrant and order the seiz-

ed items returned to Kiesel.' The court also enjoined use of in-

formation derived from the seized records; however, this was

without prejudice to lawful reacquisition of the same materials.

The court of appeals then reversed. After ordering the search

affidavit unsealed, the court held that exercise of anomalous

jurisdiction requires each of three independent findings: (1)

callous disregard of the Fourth Amendment; (2) irreparable in-

jury if relief is not awarded; and (3) the lack of an adequate

remedy at law. The court found that Kiesel had not satisfied

these extreme standards. In addition, the court found that an

‘fall records’’ search is valid under the Fourth Amendment if

the Government shows a ‘‘pervasive pattern’’ of illegality rather

than probable cause to believe that illegality permeated the en-

tire business operation.

' Anomalous jurisdiction is the power of a federal court to exercise

its equitable powers and frame decrees thereunder apart from the

grant of any specific authority under the Rules of Criminal Procedure.

— oo

REASONS FOR GRANTING THE WRIT

I.

THE DECISION BELOW CONFLICTS WITH THE

DECISIONS OF OTHER COURTS OF APPEAL AS TO

THE REQUIREMENTS FOR PRE-INDICTMENT

REVIEW OF A SEARCH WARRANT.

In conflict with the Tenth Circuit, the Eighth Circuit in Kiese/

has prescribed standards for pre-indictment review of a search

warrant which create an insurmountable barrier to review. The

Kiesel court, over a strong dissent, holds that the exercise of

anomalous jurisdiction requires each of three, independent find-

ings: (1) callous disregard bf the Fourth Amendment; (2) ir-

reparable injury if relief is not awarded; and (3) the lack of an

adequate remedy at law. The court further holds that the

availability of post-indictment review of a search warrant

through a motion to suppress negates a claim of irreparable in-

jury and thereby precludes pre-indictment review. Because

equitable principles are to be applied whether pre-indictment

review is sought pursuant to the exercise of anomalous jurisdic-

tion or rule 41(e), Fed. R. Crim. P., jurisdiction, /n re Harper,

835 F.2d 1273 (8th Cir. 1988), the decision effectively precludes

pre-indictment review of a search warrant. __

Kiese/ directly conflicts with Floyd v. United States, 860 F.2d

999, 1003 (10th Cir. 1988). In Floyd, the Tenth Circuit explicit-

ly reiected ‘‘callous disregard’’ as a factor in triggering pre-

indictment review of a Rule 41(e) motion. More importantly,

the Tenth Circuit found that irreparable harm permitting pre-

indictment review was not precluded by the availability of a

post-indictment motion to suppress, citing as examples Peiper v.

United States, 604 F.2d 1131, 1134 (8th Cir. 1979) (irreparable

injury if criminal indictment based on illegally seized evidence

appears imminent) and Mr. Lucky Messenger Service, Inc. v.

United States, 587 F.2d 15, 18 (7th Cir. 1978) (irreparable injury

if rule 41(e) movant needs funds to satisfy tax liability). Floyd

—

thus permits review in circumstances where the blanket prohibi-

tion of Kiese/ would preclude review. Accord Center Art

Galleries v. United States, 875 F.2d 747 (9th Cir. 1989).

Kiesel is also in conflict with the Fifth Circuit’s ruling in

Richey v. Smith, 515 F.2d 1239, 1243 n.10 (Sth Cir. 1975),

which rejects the claim that the availability of a post-indictment

motion to suppress precludes a finding of irreparable injury:

[A] wrongful indictment is no laughing matter; often it

works a grevious, irreparable injury to the person indicted.

The stigma cannot be easily erased. In the public mind, the

blot of a man’s escutcheon, resulting from such a public

accusation of wrongdoing, is seldom wiped out by a subse-

quent judgment of not guilty. Frequently, the public

remembers the accusation, and still suspects guilt, even

after an acquittal.

Richey, 515 F.2d at 1243 n.10 (quoting Jn re Fried, 161 F.2d

453, 458-59 (2d Cir.), cert. dismissed, 332 U.S. 807 (1947)). The

Richey court thus rejected the claim of the Kiese/ court that the

availability of post-indictment review defeats a claim of ir-

reparable injury.

Only in passing has this Court addressed the requirements ‘or

pre-indictment review of a warrant. In G. M. Leasing Corp. v.

United States, 429 U.S. 338, 359-60 (1977), the Court suggested

that irreparable injury was required for pre-indictment review

of a motion to suppress seized evidence. In so stating, the Court

failed to identify the other factors set forth in Kiese/ as in-

dividually necessary and determinative of the availability of pre-

indictment review. Nor did the Court provide a restrictive inter-

pretation of the irreparable injury requirement setting up an in-

surmountable barrier for review because post-indictment review

is always available. Kiese/ therefore represents a sharp depar-

ture from the limited guidance the Court has previously provid-

ed on the availability of pre-indictment review of a search war-

rant.

iain

—

These conflicts justify the grant of certiorari to review the

judgment below.

THE DECISION BELOW CONFLICTS WITH THE

DECISIONS OF OTHER COURTS OF APPEALS AS

TO THE STANDARD FOR CONDUCTING AN “ALL

RECORDS”’ SEARCH OF A BUSINESS.

The Fourth Amendment requires that a search warrant

describe the things to be seized with sufficient particularity to

prevent a ‘‘general, exploratory rummaging in a person’s

belongings.’’ Coolidge v. New Hampshire, 403 U.S. 443, 467

(1971). This requirement ‘‘makes general searches . . . impossi-

ble and prevents the seizure of one thing under a warrant

describing another. As to what is to be taken, nothing is to be

left to the discretion of the officer executing the warrant.’’ Stan-

ford v. Texas, 379 U.S. 476, 485 (1965).

A ‘‘general’’ or ‘‘all records’’ search may be valid, however,

depending upon the Circuit where the search was conducted. In

the Ninth Circuit, an all records search is permissible if there is

probable cause to believe that an enterprise has engaged in a

pervasive scheme to defraud. United States v. Offices Known as

50 State Distributing Co., 708 F.2d 1371 (9th Cir. 1983), cert.

denied, 465 U.S. 1021 (1984). In the First Circuit, the Ninth

Circuit standard must be satisfied, and, in addition, the illegali-

ty must be so pervasive that the activity cannot be segregated

from other legitimate activities of the organization. United

States v. Roche, 614 F.2d 6 (ist Cir. 1980). In the Tenth Cir-

cuit, the Ninth Circuit standard was rejected and probable cause

must be shown that illegality permeated the entire business

operation and that the records to be searched pertain to specific

criminal activity. Voss v. Bergsgaard, 774 F.2d 402, 406 (10th

Cir. 1985).

—

Although the Eighth Circuit originally adopted the stricter

standard of Voss in Rickert v. Sweeney, 813 F.2d 907 (8th Cir.

1987), the court has now abandoned that standard to adopt a

lesser showing for an all records search than any other Circuit.

Under Kiese/, a showing of a ‘‘pervasive pattern’’ of illegality in

one segment of a business is sufficient to justify an all records

search. Although the issue of probable cause was not litigated

before the district court, the Kiese/ court nonetheless found that

the alleged pervasive pattern of illegality with respect to Kiesel’s

waste oil business was sufficient to authorize a search of the

records of Kiesel’s other businesses, including subsidiaries and

affiliates (e.g., coal, bulk hauling, farming) unrelated to waste

oil processing.? This radical departure from its earlier rulings is

in conflict with the standards of the First and Tenth Circuit for

an all records search.

Kiesel is also in direct conflict with Center Art Galleries vy.

United States, 875 F.2d 747 (9th Cir. 1989). There, the Ninth

Circuit held that an overbroad warrant could not be justified

? As set forth in the Supplemental Brief of Appellee submitted to the

Eighth Circuit after the court granted Kiesel’s request and the af-

fidavit supporting the search warrant was unsealed in redacted form

for Kiesel’s inspection, ‘‘Kiesel’’ consisted of the following at the time

of the search: (1) The Kiesel Company: sales and service in coal, oil,

bulk and liquid hauling, and tank cleaning; (2) Paramount Hauling

Company: bulk hauling in dump and truck trailers; (3) L & L Rigging,

Inc: manufacture and sale of cable slings; (4) Berryfast, Inc:

pneumatic tool, nail, and staple manufacturing; (5) Goodsell, Inc: im-

port and export of pneumatic tools, air compressors, and other items;

(6) Major Cornerstone Supply USA, Inc: nail and staple company; (7)

Patgood, Inc: property used for coal storage; (8) Pala Oil Products,

Inc: sale of private label lubricating cil products; (9) B & C Sales, Inc:

sale of wire rope; (10) American Waste Reclamation Co: waste oil

processing in Houston, Missouri; (11) Kiesel Marine Services, Inc:

marine transport; (12) Lindy Farms, Inc: farming and cattle raising,

and (13) Ridgetop Farms, Inc: farming and cattle raising.

As Judge McMillian noted in his dissent, the waste oil business con-

stitutes less than 10 percent of Kiesel’s gross income.

—

under the ‘‘permeated-with-fraud’’ doctrine where the alleged

fraud pertained to only 20 percent of the company’s business

and there was no showing in the supporting affidavits that rele-

vant evidence was inseparable from the company’s records. In

contrast, Kiese/ permits an all records search where the alleged

fraud pertains to only a small portion of the company’s business

and the supporting affidavits fail to demonstrate that relevant

evidence is inseparable from the company’s records. It also

conflicts with the Tenth Circuit’s decision in United States v.

Leary, 846 F.2d 592, 605 (1988), where the ‘‘permeation of the

business’’ test was found insufficient to permit an all records

search where the illegal activity at issue was limited to discreet

transactions.

This Court has recently recognized this conflict. On October

2, 1989, in Norton v. United States, 110 S.Ct. 261 (1989), cer-

tiorari was denied for review of a conviction where the

**permeative character of the fraud’’ was a given in an “‘all

records’’ search. Norton v. United States, 867 F.2d 1354, 1360

(11th Cir. 1989). In dissent, Mr. Justice White recognized the

conflict between the Eleventh Circuit on the one hand and the

Tenth and the Ninth Circuits on the other regarding facially

overbroad warrants in ‘‘all records’’ searches:

The Eleventh Circuit held that law enforcement officers

reasonably relied on warrants calling for the search and

seizure of ‘‘all corporate records . . . which are evidence

and instrumentalities of the offense set forth in Section

1954 of Title 18 of the United States Code,”’ and that the

evidence seized pursuant to that warrant was admissible

under the good faith exception to the exclusionary rule ar-

ticulated in United States v. Leon, 468 U.S. 897, 104S.Ct.

3405, 82 L.Ed.2d 677 (1984). The decision of the Eleventh

Circuit conflicts with the Tenth Circuit’s decision that a

warrant ordering the seizure of all records ‘‘relating to the

purchase, sale and illegal exportation of materials in viola-

tion of the Arms Export Control Act, 22 U.S.C. 2278, and

— fo

the Export Administration Act of 1979, 50 U.S.C. App.

2410,’’ was so facially overbroad that law enforcement of-

ficers could not reasonably rely on it, United States v.

Leary, 846 F.2d 592, 594 (1988), and a similar decision of

the Ninth Circuit suppressing evidence seized under a war-

rant seeking ‘‘documents, books, ledgers, records and ob-

jects which are evidence of violations of federal criminal

law.’’ Center Art Galleries-Hawaii, Inc. v. United States,

875 F.2d 747, 749 (1989). The conflict should be resolved.

Norton v. United States, 110 S.Ct. at 261. To that ferment,

there should now be added the Eighth Circuit’s Kiese/ decision.

As Mr. Justice White’s comment to the denial of certiorari con-

cludes in Norton v. United States, supra, ‘‘the conflict should

be resolved.”’

These conflicts justify the grant of certiorari to review the

judgment below.

THE DECISION BELOW RAISES SIGNIFICANT AND

RECURRING PROBLEMS REGARDING PRE-

INDICTMENT REVIEW AND “ALL RECORDS”

SEARCHES.

This Court has never addressed the doctrine of anomalous

jurisdiction or directly addressed the general availability of pre-

indictment review of a Governmental search. Although ‘‘[a]

substantial body of precedent establishes that federal district

courts have power to order the suppression or return of

unlawfully seized property even though no indictment has been

returned,’’ Hunsucker v. Phinney, 497 F.2d 29, 32 (Sth Cir.

1974), cert. denied, 420 U.S. 927 (1975), the law is unsettled, the

Circuits are in conflict and this Court has yet to endorse or re-

ject the availability of anomalous jurisdiction and the equitable

foundations for such relief. The Kiese/ decision provides an ap-

propriate opportunity for the Court to determine the availabili-

|

ty of pre-indictment review and, by so doing, reconcile the

disparate views of the courts of appeals as to when such review

is to be available.

If left unreviewed, Kiese/ will serve to foreclose pre-

indictment review of search warrants. Under Kiese/, the

possibility of post-indictment review, which is always available,

will mean that a motion to suppress or for return of seized pro-

perty cannot be entertained until and unless an indictment has

~been brought or the Government determines that no criminal

action will be initiated. Such review will accordingly occur long

after the search was conducted thereby defeating the right

codified in Rule 41(e) for return of property once it has been il-

legally seized by the Government.

Further, this Court has never addressed the propriety of the

‘*permeation of the enterprise’’ doctrine for an all records

search, an issue upon which the courts of appeal have split over

the relevant standards to justify an all records search. Kiese/ is

in direct conflict with the Ninth Circuit’s recent decision of

Center Art Galleries. Without guidance from this Court, dif-

ferent standards will govern the same Government conduct

depending solely upon location of the search. This Court has

not addressed this issue, and the facts of Kiese/, with its differ-

ing business interests, including subsidiaries and affiliates, un-

tainted by the waste oil business, provide an appropriate vehicle

to prescribe the standard for evaluating an all records search,

assuming that an all records search is ever proper in the first in-

stance.

CONCLUSION

For these various reasons, this petition for a writ of certiorari

should be granted. :

Respectfully submitted,

Stanley M. Rosenblum

David V. Capes

ROSENBLUM, GOLDENHERSH,

SILVERSTEIN & ZAFFT, P.C.

7777 Bonhomme Avenue

Fourteenth Floor

Clayton, Missouri 63105

(314) 726-6868

Counsel for Petitioner

APPENDIX

APPENDIX A

Opinion of the United States Court of Appeals For the Eighth

Circuit, /n the Matter of the Search of 4801 Fyler Avenue, etc.,

The Kiesel Company, Inc., Appellee v. Kimberly Householder,

Special Agent, Federal Bureau of Investigation, et al., Ap-

pellants, No. 88-1573, submitted September 20, 1988 and filed

tuly 13, 1989.

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No. 88-1573

In the Matter of the Search of 4801 Fyler Avenue, etc.

The Kiesel Company, Inc.,

Appellee,

Vv.

Kimberly Householder, Special Agent,

Federal Bureau of Investigation, et al.,

Appellant.

Appeal from the United States District Court

for the Eastern District of Missouri.

Submitted: September 20, 1988

Filed: July 13, 1989

Before McMILLIAN, JOHN R. GIBSON and MAGILL,

Circuit Judges.

en i ee

JOHN R. GIBSON, Circuit Judge.

The United States appeals from a district court order requir-

ing the return of property seized during execution of a search

warrant against the Kiesel Company. The warrant, issued by

another district judge, was ruled constitutionally overbroad

because it described virtually all property on the Kiesel

premises, both business and personal. Although Kiesel had

sought relief under Federal Rule of Criminal Procedure 41(e),

the district court instead asserted ‘‘anomalous’’ jurisdiction and

proceeded in equity. As a result the district court did not per-

manently suppress the evidence, but instead required only that

the government return the evidence to Kiesel and not use it at

trial unless a proper warrant had been used to again seize the

property. We reverse the order of the district court.

The United States, following an extensive investigation by

Federal Bureau of Investigation agent Kimberly Householder

into possible violations by Kiesel of federal environmental law, '

applied to a federal district judge for a warrant to search the

Kiesel business premises at 4801 Fyler Avenue, St. Louis. Agent

Householder presented a lengthy affidavit to support the ap-

' The investigation particularly focused on criminal violations of the

Resource Conservation and Recovery Act (RCRA), 42 U.S.C. §

6928(d), the Clean Water Act, 33 U.S.C. §§ 1311, 1319(c)(1) & (2), the

Rivers and Harbors Act, 33 U.S.C. §§ 407, 411, and the Toxic

Substances Control Act, 15 U.S.C. §§ 2614, 2615(b). Violators of any

of these sections are subject to fines and imprisonment, with varying

degrees of severity. RCRA violations are felonies.

—_ = oo

plication, and the warrant was issued. It is not disputed that the

scope of the warrant was extremely broad.’

The district court declined to order the government to return

the property under Rule 41(e), looking to Rickert v. Sweeney,

813 F.2d 907 (8th Cir. 1987) to support its view, as Rule 41(e)

would require suppression of the property even where there had

not been an indictment or other proceeding instituted. It chose

to consider the matter as one in equity subject to the court’s

anomalous jurisdiction, ‘‘following the apparent route of

Rickert.’’ It did not, however, determine if traditional

equitable requirements were met, but simply proceeded to the

merits. Evaluating the warrant, the district court conceded that

the suspected criminal activity was of such a complexity that

? The district court set forth in its order three paragraphs that it

found to be representative:

3. Any correspondence, records, files, work orders, logs, or

other documents, including computer storage media, relating to

receipt, storage, blending, transfer or disposal of hazardous

wastes and hazardous waste constituents, oil, waste oil, hazar-

dous waste, fuel, and PCBs.

** *

12. Kiesel Oil’s Articles of Incorporation, corporate by-laws,

and Board of Director’s meeting minutes, or any other

documents demonstrating the existence of any other company or

joint venture in which Larry Gooden, Lorraine ‘‘Pat’’ Kiesel or

other Kiesel Oil employees are or were participants or partners,

or in which any of these individuals have an ownership interest,

which companies or joint ventures are involved in the handling

of oil, waste oil, hazardous waste fuel, hazardous waste or

PCBs.

13. Any correspondence, files, records, checking or savings

accounts, financial records, or other documents, including com-

puter storage media, relating to the.companies referenced in

paragraph [12].

Kiesel Co. v. Householder, No. 88 Misc. 75, slip op. at 4 (E.D. Mo.

Apr. 7, 1988).

— ps

some latitude was allowable in the descriptions of the property

to be seized.’ Finding the warrant to authorize an all encom-

passing search, the court declared it unconstitutionally over-

broad. It ordered the FBI to return to Kiesel all property taken

under the authority of the warrant and enjoined the use of that

property and information derived from it in any criminal in-

vestigations, but specified that the order was without prejudice.

The government could thus once again seize and use any of

Kiesel’s property if it obtained a narrower warrant.

The government appeals. It argues that the warrant was not

overbroad because probable cause to suspect a substantial pat-

tern of illegality has been established, and the principles of

United States v. Kail, 804 F.2d 441 (8th Cir. 1986), therefore ap-

ply. It points out that due deference should be accorded the rul-

ing of the first district judge who issued the warrant. It also

claims that the district court was wrong to exercise equitable

jurisdiction without considering the factors set forth in Pieper v.

United States, 604 F.2d 1131 (8th Cir. 1979). Finally it argues

that the officers executing the warrant acted in good faith, and

that United States v. Leon, 468 U.S. 897 (1984), therefore re-

quires dismissal. We have ordered the FBI’s affidavit to be

unsealed, and both parties have been given the opportunity to

submit additional comments based upon its contents.

We begin by discussing the district court’s procedural ap-

proach to this case. It properly considered Kiesel’s claim as an

equitable proceeding rather than a Rule 4l(a) motion. ‘‘[A]

motion prior to any suggestion of criminal proceedings, as here,

is more properly considered as a suit in equity rather than one

> The court specifically declined to unseal the affidavit and conduct

a hearing, as in Rickert, but its order discussing the scope of the war-

rant makes specific reference to the affidavit.

— As — _

under the Rules of Criminal Procedure.’’ Richey v. Smith, 515

F.2d 1239, 1245 (Sth Cir. 1975). Having decided this, however,

the district court failed to evaluate whether the circumstances of

the case warranted the exercise of equitable jurisdiction. Our

decision in Pieper, 604 F.2d at 1133, holds that such jurisdiction

is proper only upon a showing of callous disregard of the fourth

amendment, irreparable injury if relief is not granted, and lack

of an adequate remedy at law. See also Richey, 515 F.2d at

1243-44; Hunsucker v. Phinney, 497 F.2d 29, 34-35 (Sth Cir.

1974), cert. denied, 420 U.S. 927 (1975). Pieper, as well as its

Supporting authority, found such a showing necessary to

establish ‘‘anamolous jurisdiction’’ so as to give it authority to

proceed. In contrast, after indictment exercise of the court’s

jurisdiction is specifically authorized by Rule 4l(e) of the

Federal Rules of Criminal Procedure.

The district court, however, made no such analysis and con-

sidered none of these factors, instead asserting that the only

issue to be decided was the specificity of the search warrant

itself. It relied on Rickert v. Sweeney, 813 F.2d 907 (8th Cir.

1987), and Jn re Grand Jury Proceedings, 716 F.2d 493 (8ih Cir.

1983), evidently believing that these cases obviated the need to

consider the three Pieper factors. We do not read Rickert and

Grand Jury Proceedings so broadly. Neither contains an ex-

plicit discussion of application of the three Pieper factors, but

the opinions do not reveal that this issue was raised by the par-

ties or considered by either the district court or this court in

those cases. Our recent decision of Jn re Harper, 835 F.2d 1273,

1275 (8th Cir. 1988), makes clear that the Pieper factors must

still besmet before equitable jurisdiction may be exercised.

~

Thus, we must determine whether the district court abused its

discretion by reaching the merits of Kiesel’s claim. See Harper,

835 F.2d at 1275. This is made difficult, of course, by the

district court’s failure to analyze the equitable considerations

—_.

underlying the facts of the case. We are satisfied, however, that

the district court’s acceptance of jurisdiction need not be given

deference in view of its failure to apply the proper Pieper

analysis underlying this bare conclusion. Still, on the basis of

the record before us, we have no hesitation in concluding that

Kiesel is unable to adequately demonstrate that the Pieper fac-

tors have been met.

Most significantly, Kiesel is unable to show that the govern-

ment acted in callous disregard of its fourth amendment rights.

The federal agents searching Kiesel’s premises first obtained a

warrant from a United States District Judge using a lengthy and

detailed affidavit describing a broad range of illegal activity to

establish probable cause. Thus, the officers acted in objective

good faith, rather than with callous disregard for Kiesel’s right.

Cf. United States v. Leon, 468 U.S. 897, 923-25 (1984). ‘‘When

judges can look at the same affidavit and come to differing con-

clusions, a police officer’s reliance on that affidavit must,

therefore, be reasonable.’’ United States v. Martin, 833 F.2d

752, 756 (8th Cir. 1987). In view of the agents’ efforts to comp-

ly with the warrant requirement, and the first district judge’s ap-

proval of the search, we cannot say that Kiesel’s rights were

callously disregarded, nor, in light of the unsealed affidavit

available to us, do we conclude that there was callous disregard

in the methods utilized in the search. The affidavit described

numerous occasions of mixing waste oil contaminated with PCB

with pure oil for resale and indicated that there was a wide pat-

tern of such conduct. Examination of Kiesel’s records over the

period of time in question was justified by the affidavits. The

affidavits also contained charges that not only had tanks con-

taining contaminated oil leaked on the premises, but that sludge

from cleanup activities was buried on the premises.

Further, we find neither of Kiesel’s two allegations of ir-

reparable injury persuasive. First, it claims that its ability to

conduct business has been unduly hampered by the search, due

to the actual seizure of needed documents. Although the record

is sparse on this point, it does seem that the government has

—". =

made provisions to allow Kiesel reasonable access to the seized

documents. In any event, the burden is on Kiesel to prove in-

terference with business operations, and it has not done so. Sim-

ple unsupported allegations of business disruption or specula-

tions as to future harm are not sufficient to establish irreparable

injury.

Second, Kiesel claims harm from the potential stigma of be-

ing improperly indicted on the basis of illegally seized evidence,

thereby facing a criminal prosecution that might have been

avoided. This is a more persuasive argument. As the Fifth Cir-

cuit has stated:

[A] wrongful indictment is no laughing matter; often it

works a grievous, irreparable injury to the person indicted.

The stigma cannot be easily erased. In the public mind, the

blot on a man’s escutcheon, resulting from such a public

accusation of wrongdoing, is seldom wiped out by a subse-

quent judgment of not guilty. Frequently, the public

remembers the accusation, and still suspects guilt, even

after an acquittal.

Richey, 515 F.2d at 1243 n.10 (quoting Jn re Fried, 161 F.2d

453, 458-59 (2d Cir.), cert. dismissed, 332 U.S. 807 (1947)).

Thus, it is completely plausible for Kiesel to claim that if the

seized evidence results in an indictment that would not other-

wise have issued, real harm will occur. Former business con-

tacts may evaporate, future business may suffer, and a general

taint may attach to Kiesel’s owners and employees.

As real as this potential harm may be, however, we are not

convinced that it is irreparable injury that warrants bypassing

the normal procedures for challenging the constitutionality of

searches by resorting to equitable remedies. These remedies are

extraordinary, and they must ve used with restraint. See

Harper, 835 F.2d at 1274; Pieper, 604 F.2d at 1133; United

States v. Rapp, 539 F.2d 1156, 1160-61 (8th Cir. 1976); See also

Meier v. Keller, 521 F.2d 548, 554 (9th Cir. 1975), cert. denied,

—_—.

424 U.S. 943 (1976); Hunsucker, 497 F.2d at 34. As the govern-

ment correctly points out, however, if we were to allow the mere

threat of future prosecution to constitute irreparable harm these

procedures would not be extraordinary, but quite ordinary.

Every potential defendant could point to the same harm,

thereby invoking the equitable powers of the court. This has

not been the practice of the past, and we see no reason to alter

that course now. We therefore must conclude that the possible

stigmatization of defending oneself in a criminal trial is an in-

sufficient harm to justify the district court’s use of its equitable

powers.

Finally, as the government points out, should criminal pro-

ceedings be instituted, Kiesel will have an adequate remedy to

challenge the search, namely a motion to suppress any evidence

that has been improperly seized. Since none of the three Pieper

factors have been miet, the district court abused its discretion by

exercising equitable jurisdiction. Kiesel should have been re-

quired to wait and litigate these issues during a criminal pro-

ceeding, most likely at a pretrial suppression hearing, the nor-

mal forum for such cases.

IV.

Although we have disposed of the case on procedural

grounds, we still feel compelled to comment on the district

court’s approach to the merits. The district court failed to give

any deference whatsoever to the initial determination of pro-

bable cause, which was made by another district judge of the

same district. //linois v. Gates, 462 U.S. 213 (1983), makes clear

that courts reviewing probable cause determinations do not do

so de novo. ‘‘A magistrate’s determination of probable cause

should be paid great deference by reviewing courts. A grudging

or negative attitude by reviewing courts toward warrants is in-

consistent with the Fourth Amendment’s strong preference for

searches conducted pursuant to warrant * * * .”’ /d. at 236 (cita-

tions omitted). The reasonableness of the search here is a close

ie

—*

question, and the initial determination should have been weigh-

ed into the balance.

Were we to reach this issue, we are satisfied that, after accor-

ding proper deference to the determination by the first district

judge, having had the opportunity to consider the unsealed af-

fidavit, and after inviting supplemental briefing by both parties

on this document, we would determine that the district court er-

red in ruling the search warrant constitutionally overbroad. The

affidavit described a pervasive pattern, extending over a period

of time, of the mixture of used contaminated oil with fresh oil,

and either accidental or intentional contamination of the

premises wich such oil. We would conclude that the warrant

and search were fully supported by our earlier decision in

United States v. Kail, 804 F.2d 441 (1986). In our view, the af-

fidavits describe circumstances permeating the entire business

operation, as in Kail, so as to support a determination of pro-

bable cause that the operation was permeated with illegal con-

duct occurring over a period of several years. The records deal-

ing with Kiesel’s used oil and hazardous waste operations,

which was the limitation placed on the warrant, were properly

seized.

We mention only two related procedural inconsistencies in

the district court’s opinion. although it relied strongly on

Rickert, it refused to follow the Rickert example of unsealing

the affidavit. Additionally, there was a factual dispute as to

whether the affidavit was present at the time of the search or

not, but the district court did not make a factual finding on this

issue. In view of the development of the case, these issues are

now irrelevant, but following Rickert consistently and determin-

ing whether the warrant was present at the search might have

channeled this case into a substantially different pattern than

that presented to us.

— A-10 —

Vv.

To summarize, we believe that the issues of this case were

decided prematurely. Since Kiesel could not justify the exercise

of equitable jurisdiction, it must wait until an indictment is

brought, and challenge the search in a suppression hearing. The

judgment of the district court is reversed, and the case is

remanded with instructions to dismiss.

McMILLIAN, Circuit Judge, dissenting.

I respectfully dissent. I would affirm the judgment of the

district court both in the application of its equitable jurisdiction

and in the quashing of the overbroad, facially defective search

warrant.

The majority cites Pieper v. United States, 604 F.2d 1131 (8th

Cir. 1979) (Pieper) for the proposition that a court is required to

make three findings of fact' before it exercises its equitable

jurisdiction? to determine the legality of a search warrant. I do

' See slip op. at 4:

Our decision in Pieper . . . holds that such jurisdiction is proper

only upon a showing of callous disregard of the fourth amend-

ment, irreparable injury if relief is not granted, and lack of an

adequate remedy at law.

* Such jurisdiction is referred to as a court’s ‘‘anomalous jurisdic-

tion”’ by the Fifth Circuit. See Richey v. Smith, 515 F.2d 1239, 1243

(Sth Cir. 1975) (Richey).

— A-ll —

not so read Pieper or its supporting authority. See also Richey

v. Smith, 515 F.2d 1239 (Sth Cir. 1975) (Richey).'

The issue on appeal in Pieper was whether a district court had

abused its discretion by refusing to exercise its equitable

jurisdiction to quash a search warrant. This court noted that

the district court had considered the three Richey factors, and

that ‘“‘they are appropriate considerations for the District

Court.”’ 604 F.2d at 1133 (emphasis added). Pieper does not

hold that an explicit finding of fact on each of these factors is

mandatory before a court may exercise its equitable jurisdiction

to quash an illegal search warrant.

In the instant case the district court implicitly considered the

three factors when it stated that it was ‘‘following the apparent

route of Rickert and the stated reasoning of Richey v. Smith.”’

The Kiesel Co. v. Householder, No. 88 Misc. 075, slip op. at 8

(E.D. Mo. Apr. 7, 1988).

Even if an explicit finding of fact on each of the Richey-

Pieper factors were mandatory before a district court could ex-

ercise its equitable jurisdiction, the proper disposition of this

case would be to remand it to the district court with directions

> Richey indicates that the list of factors that the majority in the ins-

tant case seeks to make mandatory is neither mandatory nor ex-

haustive:

In Hunsucker [Hunsucker v. Phinney, 497 F.2d 29 (1974) cert.

denied, 420 U.S. 927 (1975)], we listed some of the considera-

tions that should govern the decision of the district court

whether to exercise this “‘anomalous’’ jurisdiction. First .. .

whether . . . government agents . . . displayed ‘‘a callous

disregard for the constitutional rights of the [plaintiff].’’ Other

factors to be considered are: whether the plaintiff has an in-

dividual interest in and need for the material whose return he

seeks; whether the plaintiff would be irreparably injured by

denial of the property; and whether the plaintiff has an adequate

remedy at law for the redress of his grievance.

Id. 1243-44 (emphasis added; citation omitted)

— A-12 —

to make the findings of fact. See Richey, 515 F.2d at 1244. In-

stead, the majority improperly makes the findings of fact for

the district court, see slip op. at 5-8, unnecessarily indulging in

judicial activism.

Accordingly, | would hold that the district court did not

abuse its discretion in exercising its equitable jurisdiction.

In dicta, the majority concludes that, were it to reach the

merits it would reverse the decision of the district court because

the search warrant in question is not unconstitutionally over

broad. I disagree. I would hold that the district court correctly

found that the search warrant was both overly broad and im-

properly executed.

A search warrant must limit the items to be seized so that

‘**nothing is left to the discretion of the officer executing the

search.’ Andresen v. Maryland, 427 U.S. 463, 480 (1976). In

| the instant case the affidavit supplying the probable cause for

| the search warrant was not even at the scene of the search. Nor

was there any document indicating what crime or crimes the

Kiesel Company was suspected of committing. Therefore,

nothing limited the discretion of the officers conducting the

search even though this court has held that ‘‘some measure must

be taken not only to limit the discretion of the executing officer

but also to inform the subjected person what the officers are en-

titled to take.”’ Rickert v. Sweeney, 813 F.2d 907, 909 (8th Cir.

1987). Because the search warrant in the instant case did not

limit the discretion of the officers, they did indeed search and

seize the records of many of the Kiesel Company’s subsidiaries

and controlled corporations which have nothing to do with

waste oil production and sale.

A search warrant so broad that it allows seizure of all or

almost all of the business papers of an entity is constitutionally

permissible only if the government can show ‘‘probable cause to

believe that fraud permeated the entire business operation.”

United States v. Kail, 804 F.2d 441, 445 (8th Cir. 1987) (Kai).

arterial

— A-13 —

Even with the support of the affidavit, the government cannot

make such a showing. The Kiesel company consists of such

diverse subsidiaries and controlled corporations as Berryfast,

Inc., a California corporation manufacturing pneumatic tools,

nails and staples, and Ridgetop Farms, Inc., an Illinois farming

and cattle raising corporation. Waste oil production and sales

account for less than ten percent of the Kiesel Company’s gross

income. Yet all of the allegedly illegal activities cited in the af-

fidavit (which was only made available to Kiesel Company in

redacted form months after the search) involve waste oil pro-

duction and sales and related activities. No fraud is alleged in

pneumatic tool manufacturing or farming activities, or any of

the other widespread enterprises of the Kiesel Company. For

that reason, Kai/ does not control this case as the majority sug-

gests. Furthermore, unsealing the affidavit would have been of

little use to the district court in trying to save this facially over-

broad warrant.

For these reasons, I would affirm the judgment of the district

court,

A true copy.

Attest:

Clerk, U.S. Court of Appeals, Eighth Circuit.

- it — -

APPENDIX B

Order of the United States District Court, Eastern District of

Missouri, Eastern Division, /n the Matter of the Search of 4801

Fyler Avenue, etc., The Kiesel Company, Inc., Petitioner v.

Kimberly Householder, special Agent, Federal Bureau of In-

vestigation, et al., Respondent, Civil Action No. 88-MISC-075,

entered April 7, 1988.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

No. 88 MISC 075

In the Matter of the Search of 4801 Fyier Avenue, etc.

The Kiesel Company, Inc.,

Petitioner,

Vv.

Kimberly Householder, Special Agent,

Federal Bureau of Investigation, et al.,

Respondent.

ORDER

In accordance with the Memorandum filed this day and in-

corporated herein,

IT IS HEREBY ORDERED that the restated motion of the

Kiesel Company to quash search warrant and for other relief is

GRANTED in part and DENIED in part.

IT IS FURTHER ORDERED that the search warrant in the

Matter of the Search of 4801 Fyler, St. Louis, Missouri, is

QUASHED.

IT IS FURTHER ORDERED that the government agents

return to the Kiesel Company all real and personal property

seized from the premises pursuant to the search warrant.

— A-1S —

IT IS FURTHER ORDERED that the return of property be

STAYED through April 12, 1988, to give the parties time to ex-

ercise their right of appeal.

IT IS FURTHER ORDERED that the government and its

agents are enjoined, subject to the limitations set out in the

memorandum incorporated herein, from using in any pro-

ceeding information derived from the records or property while

in the possession of the government agents pursuant to seizure

under this search warrant.

IT IS FURTHER ORDERED that the motion is DENIED in

all other respects.

Dated this 7th day of April, 1988.

/s/ Edward H. Filippine

United States District Judge

— A-16 —

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

No. 88 MISC 075

In the Matter of the Search of 4801 Fyler Avenue, etc.

The Kiesel Company, Inc.,

Petitioner,

Vs

Kimberly Householder, Special Agent,

Federal Bureau of Investigation, et al.,

Respondent.

MEMORANDUM

This matter is before the Court on the motion of petitioner,

The Kiesel Company, Inc. (hereinafter Kiesel), to quash search

warrant and for other relief. The government has filed a

response in Opposition to the motion to which Kiesel has

replied.

This action is brought by Kiesel in response to the execution

of a search warrant by the Federal Bureau of Investigation

(hereinafter FBI) and two agents of the Environmental Protec-

tion Agency (hereinafter EPA). Beginning on February 29,

1988, at 12:30 p.m., agents of the FBI and EPA seized the

premises of Kiesel at 4801 Fyler, St. Louis, Missouri, interview-

ed employees of Kiesel, screened all telephone calls in and out of

the premises, searched the premises and facilities, and seized a

number of items, real and personal property of Kiesel, pursuant

to the search warrant. Petitioner moves the Court, pursuant to

Federal Rule of Criminal Procedure 41(e), to quash the search

warrant and order suppression and return of all property seized,

and further, to unseal the affidavit in support of the search war-

rant, enjoin any investigatory activities based upon the search

warrant, quash or suspend any grand jury investigations until

— felt

the validity of the search and seizure is determined, and for such

other relief as the Court deems just and proper under the cir-

cumstances.

In support of its motion, Kiesel asserts that the search war-

rant authorized an unconstitutional general exploratory search

of its entire premises in violation of the Fourth Amendment of

the Constitution of the United States. Petitioner asserts in its

motion that the search warrant was ‘‘excessive, overbroad, and

unreasonable’”’ in the following respects:

It authorized two agencies of the United States to seize all

business and personal records for an unlimited period of

time; the scope of the search was unlimited; the face of the

warrant did not state that any documents or other items

sought therein was evidence of any specific criminal viola-

tion; the face of the warrant did not establish any probable

cause in terms of any evidence to be seized; and the face of

the warrant did not confine the search to particular items,

documents, or materials alleged to be evidence of any

specific crime.

The affidavit filed in support of the search warrant is under seal

so Kiesel has not had an opportunity to examine its contents.

Kiesel further argues that even if valid, the search warrant was

improperly executed in that areas outside its scope were search-

ed and property outside its scope was seized. The government

raises a number of issues in its response to Kiesel’s motion, in-

cluding its argument for dismissal under the holding in Pieper v.

United States, 604 F.2d 1131 (8th Cir. 1979). As to the latter, in

view of the more recent Eighth Circuit cases of Rickert v.

Sweeney, 813 F.2d 907 (8th Cir. 1987), and Jn re Grand Jury

Proceedings, 716 F.2d 493 (8th Cir. 1983), the Court finds this

argument unpersuasive and further finds the issue of the

specificity of the search warrant to be dispositive of this matter.

‘*The fourth amendment prohibits general searches and re-

quires that a search warrant describe with particularity the items

— A-18 —

to be seized.’’ Rickert v. Sweeney, 813 F.2d 907, 909 (8th Cir.

1987); Andresen v. Maryland, 427 U.S. 463, 480 (1976). Where

probable cause exists to believe the suspected wrongdoing is

complex and invades the entire business enterprise, broad

language in a search warrant may be appropriate. Rickert, 813

F.2d at 909; United States v. Bentley, 825 F.2d 1104, 1110 (7th

Cir. 1987) (‘‘seize every business paper’’ may be sufficiently

particular language); United States v. Kail, 804 F.2d 441, 444-45

(8th Cir. 1986). The description in the search warrant of the

place to be searched and items to be seized, however, ‘‘must be

as particular as the circumstances reasonably permit.’’ Bentley,

825 F.2d at 1110; Rickert, 813 F.2d at 909 (8th Cir. 1987) (pro-

bable cause existed to search for tax evasion in connection with

one particular project); Voss v. Bergsgaard, 774 F.2d 402, 406

(10th Cir. 1985) (bulk of warrant not restricted to evidence

relating to tax fraud); United States v. Roche, 614 F.2d 6, 7 (Ast

Cir. 1980); (warrant could have been limited to documents

relating to automobile insurance).

The description of the items to be seized in the search of

Kiesel’s premises is set out in a four page property list attached

to the search warrant and incorporated therein by reference.

Rather+than-set out the entire property list herein, the Court will

set Out three paragraphs of the property list which are represen-

tative of the items sought throughout:

3. Any correspondence, records, files, work orders,

logs, Or other documents, including computer storage

media, relating to receipt, storage, blending, transfer or

disposal of hazardous wastes and hazardous waste consti-

tuents, oil, waste oil, hazardous waste, fuel, and PCBs.

12. Kiesel Oil’s Articles of Incorporation, corporate by-

laws, and Board of Director’s meeting minutes, or any

other documents demonstrating the existence of any other

company or joint venture in which Larry Gooden, Lor-

a etd —

raine ‘‘Pat’’ Kiesel or other Kiesel Oil employees are or

were participants or partners, or in which any of these in-

dividuals have an ownership interest, which companies or

joint ventures are involved in the handling of oil, waste oil,

hazardous waste fuel, hazardous waste or PCBs.

13. Any correspondence, files, records, checking or sav-

ings accounts, financial records, or other documents, in-

cluding computer storage media, relating to the companies

referenced in paragraph [12].

The government argues that although the government

established in the affidavit that the entire enterprise was engag-

ed in pervasive criminality, it chose to seize only particularly

described classes of records. Furthermore, the government

asserts that although no specific dates or similar limitations

were placed on the records to be seized, it is error to assume

“that law enforcement agents would willingly seize outdated

records which were of no value to their investigation.’’ (Govern-

ment’s Response to Restated Motion, at 20).

In this case, the government was not searching for one tangi-

ble item that could be particularly described with ease; but,

rather, the suspected wrongdoing as set out in the sealed af-

fidavit is of some complexity warranting some latitude in the

breadth of the description in the search warrant. Even if the af-

fidavit is assumed to provide probable cause that property that

constitutes evidence of the commission of a criminal offense

would be obtained in a search of Kiesel, the affidavit does not

provide probable cause to justify the search warrant authorizing

a search of a// Kiesel’s records for a// time. The Court’s review

of the returns submitted by the government’s agents of the items

seized in the search support this conclusion. To assume that the

agents executing the warrant will limit the seizure of records to

those which are of value to the investigation is to ignore the

Supreme Court’s directive that the search warrant is to be drawn

to ensure ‘‘nothing is left to the discretion of the officer ex-

— A-20 —

ecuting the warrant.’’ Andersen v. Maryland, 427 U.S. 463, 497

(1976); Stanford v. Texas, 379 U.S. 476, 485 (1965); Marron v.

United States, 275 U.S. 192, 196 (1927).

The search warrant in this case is nothing more than a broad

statement particularly describing those records likely to be kept

by any enterprise engaged in the oil and waste oil business. The

warrant did not indicate that the documents sought pertained to

any specific transactions, did not identify the offenses on which

evidence was sought, did not designate or refer to a time period

for which records could be seized, and finally, did not confine

the search to any particular files or categories of documents. See

In re Grand Jury Proceedings, 716 F.2d 493, 497-98 (8th Cir.

1983). The Court holds that the search warrant on its face failed

to particularly describe the records to be searched and seized

and thus authorized a general search in violation of the fourth

amendment.

In Rickert v. Sweeney, the Eighth Circuit addressed a similar

case in which the search warrant was found to be lacking in par-

ticularity. The search warrant had been supported by a sealed

affidavit providing probable cause for the search which was not

available to the party owning the premises being searched and

which was not incorporated into the warrant nor brought to the

scene of the search. The court found that the affidavit revealed

that probable cause existed to search the records of one par-

ticular project. The Rickert court recognized that had the af-

fidavit been incorporated into the search warrant or attached to

the warrant, or even brought to the scene of the search to limit

the discretion of the agents, sufficient particularity would have

been provided. The court further noted that Rickert and his

companies were never informed as to what the agents were en-

titled to take, and that the items taken exceeded the scope of

probable cause. Rickert, 813 F.2d at 909. Nevertheless, the

court held that if the district court on remand would unseal the

affidavit, the warrant’s lack of particularity could be cured and

a hearing held in which the district court would determine which

— A-21 —

items seized were within the scope of the affidavit’s probable

cause and the items seized outside the scope of probable cause

would be ordered returned.

Upon remand, the district court unsealed the affidavit and a

hearing was held in which the government had the burden of

proof to show that the items seized in the search were within the

scope of probable cause established by the affidavit. Rickert v.

Sweeney, 86 MISC 182 (Mar. 17, 1987 and April 3, 1987).

In this case as in Rickert, the search warrant on its face is un-

constitutionally overbroad; the affidavit providing probable

cause for the warrant is under seal; the affidavit was not incor-

porated into nor attached to the search warrant; although there

is some dispute as to whether the affidavit was available at the

scene of the search, the initial representations by the parties

were that it was not available on the premises to limit the discre-

tion of the agents conducting the search; Kiesel was not inform-

ed as to what items were authorized by the warrant to be search-

ed and seized; and finally, the items seized exceeded the scope of

the affidavit’s probable cause. Virtually all business and per-

sonal records maintained by Kiesel on the searched premises

were seized. Although the sealed affidavit provides probable

cause to warrant a search of Kiesel’s premises for property con-

stituting evidence of criminal activity, unlike Rickert, the af-

fidavit does not provide particularized information going to a

specific project or projects and therefore could not be used to

limit the scope of the warrant. The affidavit would not afford

much assistance to the Court in attempting to distinguish, by

dates or specific transactions, those items seized in the search

that would fall within the scope of probable cause from those

items that would fall without.

The Court thus finds that to unseal the affidavit and hold a

hearing as was done in Rickert would be inappropriate in this

case. Nevertheless, it is clear from the Eighth Circuit’s holding

in Rickert, that the court was unwilling to order a return of pro-

a= A-22 —

perty under Federal Rule of Criminal Procedure 41(e), which

provides that property ordered returned shall also be suppress-

ed, especially at a time when there was no indictment or other

proceeding initiated by the government against Rickert. Thus,

although Kiesel’s motion is pursuant to Rule 41(e), the Court

will decline to exercise its jurisdiction under the Federal Rules of

Criminal Procedure, and will instead consider the matter as one

in equity and subject to the Court’s anomalous jurisdiction

following the apparent route of Rickert, and the stated reason-

ing of the Fifth Circuit in Richey v. Smith, 515 F.2d 1239 (Sth

Cir. 1975) relying upon the approach of Judge Wyzanski in

Lord v. Kelley, 223 F.Supp. 684 (D.Mass. 1963). In Lord, the

court ordered a return of the seized records but refused to order

their suppression from future proceedings noting that the Inter-

nal Revenue Service (hereinafter IRS) agents knew of the ex-

istence of the records prior to their seizure and could have ob-

tained the records by a signed summons had they waited until

the date of summons, reasoning that by the remedy of returning

the taxpayers’ property, the complainant would ‘‘be as well off

as, but not better off than, before the unlawful seizures.’’ Lord,

223 F.Supp. at 691.

In this case it is evident from the sealed affidavit that the

government’s agent knew of the existence of items and records

prior to their seizure. Unfortunately, the search warrant and

resulting seizure was not limited to a search for those items and

records, but rather constituted a general search and an all-

encompassing seizure. Thus, pursuant to the equitable powers

of the Court, the Court will order that all items seized pursuant

to the search warrant be returned to Kiesel, without prejudice,

but the Court will enjoin any federal agent from using in any

proceeding information derived from the records or property

while in the possession of the government agents pursuant to

seizure under this search warrant. See Lord, 223 F.Supp. at

689, 691. As in Lord, however, the injunction shall not

‘*preclude the United States or its agents from requiring, by ap-

propriate warrant, subpoena, summons, or other due process of

pene ald Lee LO

— A-23 —

law,’’ Kiesel to produce any record or item covered by the af-

fidavit before the unlawful seizure. Lord, 223 F.Supp. at 691;

see Segura v. United States, 468 U.S. 796 (1984) (independent

source of information on which warrant was secured). All other

relief requested by petitioners shall be denied.

In quashing the search warrant, the Court will stay the return

of property to allow the parties time to exercise their right of ap-

peal.

Dated this 7th day of April, 1988.

/s/ Edward H. Filippine

United States District Judge

==

APPENDIX C

Search Warrant of the United States District Court, Eastern

District of Missouri, Eastern Division, issued February 26, 1988

. on the premises of 4801 Fyler Avenue, St. Louis, Missouri.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

SEARCH WARRANT

Case Number: 88 MISC 075

In the Matter of the Search of

(Name, address or brief description of person

Or property to be searched)

See Attachment #1 (Fylér) :

TO: Special Agent Kimberly Householder and any Authorized

Officer of the United States

Affidavit(s) having been made before me by Special Agent

Kimberly Householder who has reason to believe that _ on the

person of or {X) on the premises known as (name, description

and/or location)

See Attachment #1 (Fyler) incorporated herein by reference

In the Eastern District of Missouri, there is now concealed a cer-

tain person or property, namely (describe the person or proper-

ty)

See attachment #2 (Property List), incorporated herein by

reference

I am satisfied that the affidavit(s) and any recorded testimony

establish probable cause to believe that the person or property

so described is now concealed on the person or premises above-

described and establish grounds for the issuance of this warrant.

i Sle I ae CO el le ee A A AR

I a hs eR

~ a mee: Paterna: a8

ic

— A-25 —

YOUR ARE HEREBY COMMANDED to search on or before

March 8, 1988

Date

(not to exceed 10 days) the person or place named above for the

person or property specified, serving this warrant and making

the search (in the daytime — 6:00 A.M. to 10:00 P.M.) (at any

time in the day or night as I find reasonable cause has been

established) and if the person or property be found there to seize

same, leaving a copy of this warrant and receipt for the person

Or property taken, and prepare a written inventory of the person

or property seized and promptly return this warrant to Stephen

N. Limbaugh, U.S. District Judge, as required by law.

February 26, 1988 at St. Louis, Missouri

Date and Time issued City and State

Stephen N. Limbaugh, U.S. District Judge

Name and Title of Judicial Officer

/s/ Stephen N. Limbaugh

Signature of Judicial Officer

—~_~y

ATTACHMENT #1

Premises List

a. 4801 Fyler, St. Louis, Missouri

This site is more particularly described as real estate, containers,

and attached structures on the north side of Fyler, along the

most easterly part of the 4800 block, east of the intersection of

Fyler and Kingshighway, and which has the address of 4801

Fyler. The property is immediately to the east of a used car lot

and is bounded by a wire fence on all sides, with a railroad track

bounding its northern and eastern sides. Two large warehouse-

style buildings are located at 4801 Fyler, with the main office be-

ing located in the western portion of the easternmost of the two

large warehouse-style buildings. On this building, a small

enclosed porch, with five cement steps attached, forms the en-

trance where ‘‘The Kiesel Co.”’ appears in white block letters on

the brick front. A large parking, storage, shipping and delivery

area surrounds these buildings and numerous tanks and drums

are on the property. There are two entrances through the sur-

rounding fence, which are on the south side of the property,

along Fyler, which dead-ends at the railroad track running

directly east of the property. Photographs of the property are

attached as exhibits 1, 2 & 3.

ATTACHMENT #2

Property List

i. Hazardous waste and hazardous waste constituents, oil,

waste oil, hazardous waste fuel and polychlorinated biphenyls

(hereinafter ‘‘PCBs’’); sludges, wastes and residues generated

by the receipt, storage, blending and transfer of oil, waste oil,

and hazardous waste fuel, PCBs, and contents of vacuum

trucks, tank trucks and barges; tanks, drums, barrels, contain-

ment or impoundment areas/devices, drains, tunnels, hoses and

sewer lines, spigots, faucets and valves in which or through

which hazardous wastes, hazardous waste constituents, oil,

= Atl —

waste oil, hazardous waste fuel and PCBs or residue thereof, are

concealed or have passed; samples of earth, soil, gravel, pave-

ment or other surface coverings, of subsurface soil or material,

of leachate and of contiguous navigable waters and waterbed.

2. All books and records (of all sorts, including computer

disks or printouts) indicating the names, addresses, and

telephone numbers, of all company employees, and all

documents which contain job descriptions or other material

defining the nature and scope of each employee’s responsibility

at The Kiesel Company (and its subsidiary or controlled cor-

porate entities, as more fully described in paragraph 3 of the af-

fidavit in support of this search warrant, said description being

hereby incorporated by reference, and which entities are

hereafter jointly referred to as Kiesel Oil), and records which

show time and attendance of said employees, including time

cards, or other such records reflecting employment history, such

records to include those of former employees no longer current-

ly employed by the company.

3. Any correspondence, records, files, work orders, logs, or

other documents, including computer storage media, relating to

receipt, storage, blending, transfer or disposal of hazardous

wastes and hazardous waste constituents, oil, waste oil, hazar-

dous waste, fuel, and PCBs.

4. Documents demonstrating or pertaining to purchases of

raw and waste material by Kiesel Oil for distribution.

5. Any correspondence (inter and intra office) of Kiesel Oil

and between Kiesel Ou! aad its employees and other companies

and persons, memoranda, records, files or other documents (in-

cluding computer storage media) regarding contracts with Kiesel

Oil customers for the handling of hazardous wastes or

materials, oil, waste oil, hazardous waste fuel or PCBs.

6. Any correspondence, notes, or memoranda between of-

ficials and employees of Kiesel Oil, and federal, state, and local

— A-28 —

environmental agencies (or other public safety agencies) which

in any way relate to the company’s oil or waste oil handling or

brokering activities or to hazardous wastes.

7. Any documents relating to instructions given to Kiesel Oil

employees or personnel regarding the handling or disposal of

oil, waste oil, or wastes from the oil or waste oil business, in-

cluding safety-related information.

8. Any documents showing knowledge by Kiesel Oil its ex-

ecutives or employees of federal or state hazardous waste permit

and regulatory requirements, or hazardous waste fuel

regulatory requirements.

9. Any diagrams or blueprints pertaining to the premises

described herein.

10. Any manifests, bills of lading, shipping papers, invoices

or other documents showing pick up, transportation, or

delivery of any oil, waste oil, hazardous waste fuel, hazardous

waste, hazardous waste constituents, or PCBs, or pertaining to

analyses of any of said substances.

11. Documents relating to any vehicles registered to, owned,

or leased by Kiesel Oil and used in the business of Kiesel Oil.

12. Kiesel Oil’s Articles of Incorporation, corporate by-laws,

and Board of Director’s meeting minutes, or any other

documents demonstrating the existence of any other company

Or joint venture in which Larry Gooden, Lorraine ‘‘Pat’’ Kiesel

or other Kiesel Oil employees are or were participants or part-

ners, Or in which any of these individuals have an ownership in-

terest, which companies or joint ventures are involved in the

handling of oil, waste oil, hazardous waste fuel, hazardous

waste or PCBs.

13. Any correspondence, files, records, checking or savings

accourts, financial records, or other documents, including com-

puter storage media, relating to the companies referenced in

paragraph 13.

—~—= wn

14. Documents relating to personal checking accounts, sav-

ings accounts, or other financial documents relating to Larry

Gooden and Lorraine ‘‘Pat’’ Kiesel, which documents will

reflect salaries received, payments made from or to either or

both on account of the operation of Kiesel Oil, its subsidiary or

controlled companies.

1S. Any records of telephone conversations made by

employees of Kiesel Oil, as well as long distance telephone bills

and personally-imaintained diaries of such employees relating to

Kiesel Oil activities.

16. Any correspondence, files, records, analysis or other

documents relating to laboratories utilized by Kiesel Oil, Larry

Gooden and Lorraine ‘‘Pat’’ Kiesel or by any other companies

or joint ventures in which Kiesel Oil, Larry Gooden, and Lor-

raine ‘*Pat"’ Kiesel are involved.

17. Computerized records of any documents described in

paragraphs | through 16 above, along with the documentation

explaining operation of the computer system and any back-up

tapes or discs.