# Petition for Writ of Certiorari — Silva v. United States > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386012_2026%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1995 - **Citation:** 515 U.S. 1189 ## Text Supreme Court. vim FiLs&bD is 25 Jus \ No. 7 5 ¢€ IN THE SUPREME COURT OF THE UNITED STATES October Term, 1994 Edward Silva, Jr.; Silva Harvesting, Inc.; Ord & Norman; E.O.C. Ord, Inc.; and Edward O.C. Ord, Petitioners United States of America, and United States District Court for Northern California, Respondents. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT PETITION FOR WRIT OF CERTIORARI EDWARD O.C. ORD Counsel of Record ORD & NORMAN 650 California Street 26th Floor San Francisco, CA 94108 415/274-3800 Counsel for Petitioners June 1995 (VPS QUESTIONS PRESENTED 1) Whether the denial of a motion to quash a grand jury subpoena brought by a target of the grand jury a final appealable order under the Perlman (Perlman v. United States, 247 U.S. 7 (1918)) doctrine when the subpoena is issued to an accountant working for the target’s attorney and the subpoena calls for documents prepared by the accountant in order to assist the attorney in the defense of the target? 2) Whether the denial of a motion to quash a grand jury subpoena in the circumstances described above is reviewable pursuant to a petition to the Court of Appeals under the All Writs Act, 28 U.S.C. § 1651? LIST OF PARTIES The parties listed in the caption to this application are the real parties in interest to this case. In their petition to the Court of Appeals for the Ninth Circuit for an extraordinary writ under the All Writs Act, Petitioners, in addition to the United States of America, also named as respondents the United States District Court for the Northern District of California and some of the United States government officials involved in the underlying grand jury investigation. These officials were Assistant United States Attorney Leo P. Cunningham, Justice Department Trial Attorney Daniel J. Graber, and Internal Revenue Service Special Agent Robert Scott. The Ninth Circuit in captioning the writ petition action named only the United States District Court as ii ¥ Respondent, with the United States of America as real party in interest, apparently removing the individuals as Respondents. However, aS a matter of courtesy and in an abundance of caution, Petitioners will serve Mr. Cunningham, Mr. Graber, and Mr. Scott. In the Ninth Circuit, the United States of America (and presumably the other originally named respondents) was represented by Attorneys Cunningham and Graber. In the District Court, the subpoenaed witness, Charles D. Bailin, joined in the petitioners’ motion to quash the grand jury subpoena, but he was not a party to the appeal. 1ii TABLE OF CONTENTS QUESTIONS PRESENTED ; ........ i el ee © TABLE OF CONTENTS . . .: «© «© © « « S44 TABLE OF AUTHORITIES ........vi eee te a a a a ae JURISDICTION a a ae ee ee ee ee STATUTORY PROVISION INVOLVED .... 2 STATEMENT er ee ae er ee ae ee ee a A. The District Court PreceeGings ...:+++e § B. Proceedings in the Court et ne eee, a eT REASONS FOR GRANTING THE PETITION .. 11 I. The Ninth Circuit’s Decision Clearly Conflicts with Decisions of Other Circuits. Procedures For Appellate Review of the Invasion of Privilege by Grand Juries Must Be Uniform Among the Circuits. ......11 II. The Decision of the Court of Appeals Was Erroneous and Violates Perlman and other Decisions of this Court. .... 24 iv III. The Decision of the Court of Appeals Poses Serious Consequences for the Criminal Justice System, and the Legal and Accounting Professions, Because it, Practically Speaking, Allows the United States to Invade Validly-Established Communicative and Work-Product Privileges Prior to any Appellate Review, Thus Prejudicing the Defendant’s Right to Counsel and the Preparation a eee ee ee IV. The Ninth Circuit’s Denial of Petitioners’ Petition for a Writ of Mandamus Conflicts with Other Circuits’ Rulings Recognizing that Mandamus Is Appropriate to Review Validly-Asserted Privileges Prior to Compelled Disclosure. ek ane ig ene oo Canoe en CONCLUSION ee oe ee ee ee Le ak APPENDIX 1. Opinion of Court of Pn 23 i ad eg se a eas 2. District Court Memorandum Of Decision and other a ea - 20a 3. Initial Stay Order by Court of Appeals ..... 35a 4. Court of Appeals Denial Of Retiearing ....... 3% r TABLE OF AUTHORITIES CASES Admiral Ins. Co. v. United States District Court, 881 F.2d 1486 (9th Cir. 1989) yg ee ae ee eee ee Bogosian v. Gulf Oil Corp., 738 F.2d 587 (3d Cir. 1984) is « « Be Castle v. Sangamo Weston, Inc., 744 F.2d 1464 (11th Cir. 1964) (per curiam) ...... 39n Chase Manhatten Bank, N.A. v. Turner & Newhall, PLC, 964 F.2d 159 (2d Cir. 1992) .. 57-58 Church of Scientology v. United States, U.8. , ‘ 113 §$.Ct. €47, 121 &.8a.2d a2 {h9eal «7s. 4k Ss a ee ee City of Las Vegas v. Foley, 747 F.2d 1294 (9th Cir. 1984) ss « Be City of Los Angeles v. Williams, 438 F.2d 522 (Sth Cir. 1972) ae ak ae Sin, 52 Cobbledick v. United States, 309 U.S. 323 (1940) ee a ee Conkling v. Turner, 883 F.2d 431 (Sth Cir. 1989) i. & a ee oe Corporacion Insular de Seguros v. Garcia, 876 F.2d 254 (206 Civ. Seer: s+ 2 as & ee ee vi Diversified Industries, Inc. v. Meredith, 572 F.2d 596 (8th Cir. 1977) “a wis oe ee ee | Eastland v. United Servicemen’s Fund, 421 U.S. 491 (1975) : 27-28 Elkins v. United States, 364 U.S. 206 (1960) ay ee Fisher v. United States, 425 U.S. 391 (1976) ‘oe ee eee ec Florida v. Rodriguez, 469 U.S. 1 (1984) (Stevens, J., Giegenting) ........ 20 Grand Jury Subpoena Duces Tecum Dated Jan. 2, 1985, 767 F.2d 26 (2d Cir. 1985) ...417 Gravel v. United States, 408 U.S. 606 (1972) Oe ae te oS 6 ee Haines v. Liggett Group, Inc., 975 F.2d 81 (3rd Cir. 1992) ie) eae SS, BF Hanna v. Plumer, 380 U.S. 460 (1965) Se et oe oe oa Harper & Row Publishers, Inc. v. Decker, 423 F.2d 487 (2d Cir. 1970), affirmed by an equally divided court, 400 U.S. 348 (1971) Sag wal be eae ee Harris v. United States, 413 F.2d 316 (9th Cir. 1969) eee ee ee 39n vii In In In In In In In In In In re Burlington Northern, Inc., 822 F.2d 518 (5th Cir. 1987) cert. den. 484 U.S. 1007 (1987) S48 ee ae oe a eee re Burlington Northern, Inc., 679 F.2d 762 (8th Cir. 1982) re Doe, 662 F.2d 1073 (4th Cir. 1981) re Fink, 876 F.2d 84 (llth Cir. 1989) re Grand Jury (C. Schmidt & Sons), 619 F.2d 1022 (3d Cir. 1980) re Grand Jury Investigation of Ocean Transportation, 604 F.2d 672 (D.C. Car. 1979) re Grand Jury Proceedings, 867 F.2d 562 (9th Cir. 1989), cert. den., 493 U.S. 906, rehearing den. 493 U.S. 985 (1989) . 15, re Grand Jury Proceedings (Cianfrani), 563 F.2d 577 (3d Cir. 1977) re Grand Jury Proceedings (Damore), 689 F.2d 1351 (ath Cae. 2968) 55°. » « « 5, re Grand Jury Proceedings (Doe), 831 F.2d 222 (lith Cir. 1987) re Grand Jury Proceedings (Fine), 641 F.2d 199 (Sth Cir. 1981) o « « « 8, 38, viii 59 39n 41 39n 23 17 15n 19 SAH nee, ms In re Grand Jury Proceedings (FMC Corporation), 604 F.2d 798 (am Gane - 2979) 6 ees ue eK. 13 In re Grand Jury Proceedings -Gordon, 722 F.2d 303 COEG--C5F; 2003) - 66 2 kw. ss 4, 19 In re Grand Jury Proceedings (Katz), 623 F.2d 122 Cee eee lOO? 654 6 kkk ee « 2 In re Grand Jury Proceedings (Malone), 655 F.2d 882 (8th Cir. 1981) ia e o ea See AD In re Grand Jury Proceedings (Manges), 745 F.2d 1250 (SEn Civs 1964) ..... ss. 38n In re Grand Jury Proceedings (Schofield), 721 F.2d 1221 Swom Gals 2900) esc. es ee. 4 In re Grand Jury Proceedings, Subpoena to Testify to Wine, 841 F.2d 230 (8th Cir. 1988) .. 14 In re Grand Jury Proceedings, Subpoena to Vargas, 723 F.2d 1461 (10th Cir. 1983), cert. den. 469 U.S 819 (1984) .. 15, 62 In re Grand Jury Subpoena 92-1 (SJ}, 31 F.3d 826 SPUR Car, 1988) fees 6 ce. «ek. 18 In re Grand Jury Subpoena Issued to Bailin, 51 F.3d 203 (9th Cir. 1995) s-3 « & Ry SG~RSe ix In In In In an In In In In In ee re Grand Jury Subpoena Dated Dec. 10, 1967, 926 F.2d 847 (9th Cir. 1991) sa « u-e « a@s 89 re Grand Jury Subpoena Dated June 5, 1985, 825 F.2d 231 (9th Cir. 1987) se. =e w 2 oe BS, Se Re Grand Jury Subpoena (DeGuerin), 926 F.2d 1423 (Sim - Gaes 20PRP sk es 8 oe Ee re Grand Jury Subpoena Duces Tecum, 769 F.2d 52 2G Cat. 2SGe) il wuss sh re Grand Jury Subpoena Served Upon Niren, 784 F.2d 939 (9th Cir. 1986) . 2 ep Be 2a, 42 re Grand Jury Subpoenas, April 1978, at Baltimore, 581 F.2d 1203 S400 CES. 298. Pe) ee 25, 28n, 38 Reisman v. Caplin, 375 U.S. 440 (1964) 22, 32-34 Schlagenhauf v. Holder, 379 U.S. 104 (1964) ee eee eee ee Sporck v. Peil, 759 F.2d 312 (3d Cir. 1985), cert. den., 474 U.S. 903 (1985) era se Trammel v. United States, 445 0.8. 40 t29eer «2s. ae United States v. Davis, 1 F.3d 606 (7th Cir. 1993) we we: a? Se re ee United States v. Jones, 696 F.2d 2069 (66h Cas. 3900) «© « = « «se Oe United States v. Morton Salt Co., 338 U.S. 632 (1950) a re 32n £13 United States 418 U.S. United States 422 U.S. United States 379 U.S. United States 1183 (3d United States 402 U.S. United States District (9th Cir. United States District (4th Cir. 352 U.S. United States 3 F.3d 571 United States 554 United States v. Brimmer, (Em.App. S72 U.S. Upjohn Co. v. 449 U.S. (1989) Nixon, (1974) Vv. 683 25 v. Nobles, 225 (1975) 35-36 Vv. Powell, 48 (1964) 32n V. RMI Co., 599 F.2d Cir. 1979) 61 v. Ryan, 530 (1970) 12 v. United. States Court, 717 F.2d 478 1983) v. United States Court, 238 F.2d 713 1956), cert. den. 981 (1957) 62 Victoria-21, (2d Cir. 1993) V. a2 491 U.S. v. Zolin, 21-22 Dep’t. of Energy 776 F.2d 1554 1985), cert. den. 1045 (1986) 40, 60 United States, 383 (1981) 44-49 Velsicol Chemical Corp. v. Parsons, (7th Cir. 401 U.S. denied, (1978) 561 F.2d 671 1977), cert. 942 14, 18-19 xiii Westinghouse Electric Corp. v. Republic of Philippines, 951 F.2G@ 14346 (3G Cat. 2992)... OF Will v. United States, 3853. U.e. Be. Saget. « 25 S52, 56n Wm. T. Thompson Co. v. General Nutrition Corp., 671 F.2d 100 (30 C205 Bee? 2 See ee ee STATUTES, REGULATIONS AND RULES 20 U.3.6. © Ree we: 6 ee de ae 2 420 U.8:%s § eee 65 tS eS -St5 eee a 26 U.S.C. § 2652 ee ee Se ee ee Cal. Bus. & Prof. Code § 5100(f) (Deaexinue 29es).. es eos 3. Vs ae Cal. Bus. & Prof. Code § 5101 (Deerings 1993) 6 wie’: baa he oe eee Cal. Bus. & Prof. Code § 6068 (e) (peerings 1993). .-%-« 4's « — 23-28 Cal. Code of Regulations cit. 16, 3:36 p Yes we ee Os eee Cal. Code of Regulations ~€3€. 265.“ Ro eee se ee ee eee Supreme Court Rule 10.1.(a) ... 16, 21 OTHER AUTHORITIES C.A. Wright, et al., 15B Federal Practice and Procedure § 3914.23 at 132-133 (2d ed. 1992) .. 55, 56 Xiv C.A. Wright, et al., 16 Federal Practice and Procedure § 3934 at 235 (1977) ee ee on eee oe 56-57 C.A. Wright, et al., 16 Federal Practice and Procedure § 3935 at 246-251 (1977) ee tee ee ee C.A. Wright, et al., 16 Federal Practice and Procedure § 3935 Se @67°G8 (i077) 82 J. Wigmore, 8 Evidence § 2290 (McNaughton rev. 1961) ..... 47 R.L. Stern, et al., Supreme Court Practice § 4:15 at 191-92 (vou is BEE? 6 eee a ee xo s XV Petitioners, Edward Silva, Jr., Silva Harvesting, Inc., Ord & Norman, E.O.C. Ord, Ine. ; and Edward o.f. Ord,’* respectfully petition for a writ of certiorari to review the judgment of the United States Court of Appeals for the Ninth Circuit in this case. OPINIONS BELOW The opinion of the Court of Appeals (App., infra, 2a-19a) is published at In re Grand Jury Subpoena Issued to Bailin, S51 F.3d 203 (9th Cir. 1995). The order of the Court of Appeals denying Petitioners’ motion for rehearing (App., infra, 39a) is unreported. The opinions and orders of the District Court (App., infra, 20a-34a) are unreported. JURISDICTION The Ninth Circuit filed its opinion 1 Silva Harvesting, Inc. and E.O.C. Ord, Inc. do not have any parent or subsidiary corporations or companies. 1 on March 28, 1995. App., infra, 3a. This Court’s jurisdiction is invoked under 28 U.S.C. § 1254(1). This petition is timely filed because it is being filed within 90 days of the Ninth Circuit’s denial of Petitioners’ motion for rehearing with Suggestion for rehearing en banc, entered June 7, 1995. (App., infra, 39a). STATUTORY PROVISION INVOLVED The All Writs Act, 28 U.S.C. § 463i, provides, in pertinent part, that: "(a) The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdiction and agreeable to the usages and principles of law." STATEMENT This case arises out of a criminal tax investigation of Petitioners, Edward Silva, Jr. and Silva Harvesting, Inc. (hereafter collectively the "Clients"), in which they are represented by Petitioners, Ord & Norman, E.0O.C. Ord, ine., a 2 professional law corporation, and Edward O.C. Ord, Attorney at Law (hereafter collectively "Ord"). On March 15, 1994, a grand jury subpoena was served on the Salinas, California outside, independent accounting firm of Bailin, Stanford & Lavorato, Inc. through Charles D. Bailin, a Certified Public Accountant (CPA) and a shareholder and officer of the firm. The firm and Bailin had previously worked as tax preparers for the Clients, and had been contractually retained by Ord in April 1992 tc provide accounting and other assistance in defending the Clients against the IRS investigation. App., infra, 20a-23a. The subpoena called for the production of certain work papers and records of Bailin that had been prepared pursuant to Bailin’s engagement by Ord. Specifically, the subpoena called for work papers and records concerning a cash 3 tracing project Bailin undertook at Ord’s direction. The original impetus for the project came from a suggestion made by an Internal Revenue Service (IRS) agent that Bailin look into certain payments. App., infra, 23a-24a. Approximately two years earlier, the IRS had began an administrative investigation of the Clients’ tax returns for specific years. After being contacted by an IRS agent, Bailin recommended to the Clients that they hire a tax attorney to represent them in the IRS investigation. App., infra, 2la-22a. In April 1992, the Clients hired Ord to represent them. Id. at 22a. Ord then hired Bailin to assist in the representation. Id. The Clients’ case was formally referred to the IRS's Criminal Investigation Division for investigation of possible criminal tax violations. During this administrative criminal 4 investigation, Bailin was served with an IRS administrative summons to appear before an IRS Special Agent. He appeared, accompanied by Ord, but refused to answer some questions based on the assertion of the attorney-client and/or attorney work- product privileges. Instead of seeking an enforcement order for the IRS summons in District Court, the next year, the United States Attorney served the grand jury subpoena on Bailin, tracking the contents of the IRS summons. A. The District Court Proceedings Ord and the Clients jointly moved in the United States District Court for the Northern District of California to quash the subpoena based on claims of attorney- client and work-product privilege. The District Court had 28 U.S.C. § 1331 jurisdiction over this case. It held an evidentiary hearing on September 19, 1994. On September 21, 1994, the Court denied 5 the Petitioners’ motion and ordered Bailin to comply with the subpoena. See App., infra, 20a-3la. The District Court found that: (See App., infra, 20a-26a.) (a) As of April 15, 1992, Bailin was employed by Ord as his sub-agent in the performance of his legal work for the Clients. (b) After the IRS agent suggested that Bailin trace several cash payments in the corporate books, Bailin met with the agent and "pursuant to direction and control of his principal, Attorney Ord," disclosed that he could trace only two of the ten cash payments. (c) Since "the search conducted by Bailin was initiated not by Ord but by the Internal Revenue Service vr an ~ 39 extremely doubtful whether the results of Bailin’s search" are covered by attorney- client privilege. (d) Even if privilege -—were applicable, "the attorney-client privilege was waived by the distlosure made at Ord’s direction on December 14, 1992." (e) Since Bailin’s inquiry was initiated by the IRS "and not by any inquiry germane to Ord’s representation of Movants, the work product privilege never attached." The District Court granted a temporary stay to allow application for a stay to the Court of Appeals. App., infra, 32a-34a. In the stay order, the issue of the Perlman doctrine was addressed, and the Court found that the Ninth Circuit’s "current attorney" exception to Perlman did not apply because "[n]o case places non-attorney sub-agents of the attorney in [the category of current attorney]." App., infra, 33a. B. Proceedings in the Court of Appeals Petitioners filed a timely Notice of 7 Appeal with the United States Court of Appeals for the Ninth Circuit. On October 4, 1994, the Ninth Circuit issued an order granting a stay of the District Court’s order pending appeal, denying the United States’ motion to dismiss the appeal on jurisdictional grounds, and setting an expedited briefing schedule. App., infra, 34a-38a. The order specifically stated that "a substantial question" existed as to whether the appeal falls within the Perlman doctrine, and ordered the parties to brief the issue of its jurisdiction. Id.at 36a.? Petitioners also filed a petition, under the All Writs Act (28 U.S.C. § 1651), for a writ of mandamus with the . The United States in its reply brief in the Court of Appeals sought to sidestep the jurisdiction issue by urging the Court to take jurisdiction under the doctrine of "hypothetical jurisdiction." See App., infra, 16a-17a. The Ninth Circuit declined. Id. at 17a. 8 Ninth Circuit. App., infra, 5a. The direct appeal and the writ petition were consolidated and oral argument was held regarding both the appeal and the writ petition. The Ninth Circuit filed its opinion on March 28, 1995. App., infra, 2a-19a. The Ninth Circuit dismissed the appeal for lack of subject matter jurisdiction, and also denied the petition for a writ. App., infra, 3a, 6a. The Ninth Circuit acknowledged that an exception to the rule that the denial of a motion to quash a grand jury subpoena is a nonappealable, interlocutory order exists where the subpoena is directed to a third party who cannot be expected to risk a contempt citation in order to preserve the movant’s right to appeal. App., infra, lla, citing Perlman v. United States, 247 U.S. 7 (2936). The Court then applied an exception 9 SEA eas Pe HR Nite K 9 4 ete tinal Sane PI, WR ted AFF cS eA I RTT! RR sie i als Sain stele: to the Perlman doctrine that it had sometimes applied to third parties who are participants in the confidential relationship on which the movant’s claim of privilege is based, and over which the movant can be expected to exercise control. App., infra, 1la-14a. The Court had previously applied this exception to the narrow circumstance of an attorney who is currently representing the movant. Id. at lla-l2a. The Court’s opinion extended this exception, for the first time, to non- attorney agents (independent contractors) hired by an attorney to assist him or her in performing the legal defense work in a particular case. App., infra, 14a-1l6a. The opinion states that the appealability of such an order where the subpoenaed party is a non-attorney agent is a question of first impression in the circuit. App., infra, 10a. Specifically, 10 the Court found that because the accounting firm and the CPAs within it were brought under the umbrella of privilege through their retention by Ord, they ipso facto have the same legal duties and obligations of the attorney to commit contempt to protect the privileged relationship. App., infra, 15a. It also rejected the use of the All Writs Act (28 U.S.C. § 1651) to review the validity of this invasion of privilege and "as a means to avoid the final judgment rule in the context of motions to quash grand jury subpoenas." App., infra, 18a. The Court also found that there was no "“usurption of power." Id. Petitioners filed a timely motion for rehearing with suggestion for rehearing en banc, which was denied on June 7, 1995. App., infra, 39a. REASONS FOR GRANTING THE PETITION I. The Ninth Circuit’s Decision Clearly Conflicts with Decisions of Other Circuits. Procedures For Appellate Review 11 re —* of the Invasion of Privilege by Grand Juries Must Be Uniform Among the Circuits. Appeal from a denial of a motion to quash a grand jury subpoena typically does not lie until the person to whom the subpoena is directed has first resisted the order, committed, and been adjudged in contempt. United States v. Ryan, 402 U.S. 530 (1970); Cobbledick v. United States, 309 U.S. 323 (1940). This is because finality is a condition for appellate jurisdiction, Cobbledick, 309 U.S. at 324- 25, and a denial of a motion to quash a grand jury subpoena is generally not considered a final, appealable order. Ryan, 402 U.S. at 532-33. In Ryan, however, this Court recognized an exception to the finality rule for a "limited class of cases where denial of immediate review would render impossible any review whatsoever of an individual’s claims." 402 U.S. at 533. 12 With regard to this class of cases, the Ninth Circuit explained in In Re Grand Jury Subpoenas Duces Tecum (Lahodny), 695 F.2d 363, 365 (9th Cir. 1982) that: "{A]n immediate appeal is proper when the subpoena is directed to a third party ... because that party normally will not be expected to risk a contempt citation but will instead surrender the sought-after information, thereby precluding effective appellate review at a later stage." (emphasis added.) This rule and rationale has been followed with regard to attorneys in many federal circuits. See, e.g., In re Grand Jury Proceedings (Katz), 623 F.2d 122, 124-25 (2d Cir. 1980); In re Grand Jury Proceedings (FMC Corporation), 604 F.2d 798, 800-01 (3d Cir. 1979); United States v. Jones, 696 F.2d 1069 (4th Cir. 1982) ;° 3 See also, In re Doe, 662 F.2d 1073, 1076 (4th Cir. 1981), in which the Fourth Circuit allowed an attorney/grand jury target to immediately appeal the denial of his motion to quash a grand jury subpoena directed to his law partnership in order to preserve his assertion of the attorney 13 In re Special Grand Jury No. 81-1, 676 F.2d 1005, 1008 (4th Cir. 1982) (stating that the vast majority of circuits have allowed appeals of orders involving grand jury subpoenas to attorneys); Conkling v. Turner, 883 F.2d 431, 433-34 (Sth Cir. 1989); In re Grand Jury Proceedings (Fine), 641 F.2d 199, 201-03 (5th Car. 1981); In re Grand Jury Proceedings - Gordon, 722 F.2d 303, 305-07 (6th Car. 1983); United States v. Davis, 1 F.3d 606, 607 (7th Cir. 1993); Velsicol Chemical Corp. v. Parsons, 561 F.2d 671, 673-74 (7th Cir. 1977), cert. denied, 401 U.S. 942 (1978); In re Grand Jury Proceedings, Subpoena to Testify to Wine, 841 F.2d 230, 232-33 (8th Cir. 1988); In re Grand Jury Proceedings (Malone), 655 F.2d 882, 884-85 (8th Cir. 1981); In re Grand Jury Subpoena 92-1 (SJ), 31 F.3d 826 (9th Cir. 1994); In work product doctrine. 14 re Grand Jury Proceedings, 867 F.2d 562, 564 (9th Cir. 1989), cert. den., 493 U.S. 906, rehearing den. 493 U.S. 985 (1989) ; In re Grand Jury Proceedings (Schofield), 721 F.2d 1221, 1222 (9th Cir. 1983); In re Grand Jury Proceedings (Damore), 689 F.2d 1351, 1352 (11th Cir. 1982) .‘ At least three circuits do not permit clients to take immediate appeals from orders compelling testimony or documents from their attorneys. See In re Sealed Case, 655 F.2d 1298, 1300-02 (D.C.Cir. 1981); In re Oberkoetter, 612 F.2d 15, 16- 18 (lst Cir. 1980); In re Grand Jury Proceedings, Subpoena to Vargas, 723 F.2d 1461, 1464-66 (10th Cir. 1983), cert. den. 469 U.S 819 (1984). Resolving this * This case may have been overruled by the Eleventh Circuit’s later decision in In re Grand Jury Proceedings (Doe), 831 F.2d 222 (11th Cir. 1987). However, it is doubtful that Doe overruled Damore because Doe involved a subpoena ad testificandum and Damore involved a subpoena duces tecum. 15 SN ee fundamental conflict between the circuits, standing alone, requires granting certiorari.” See Supreme Court Rule $0.2. (a). The Ninth Circuit appears to sometimes make a distinction between current and former attorneys for the purposes of applying the Periman doctrine. See In re Grand Jury Subpoena Served Upon Niren, 784 F.2d 939 (9th Cir. 1986); In re Grand Jury Subpoena Dated June 5, 1985, 825 F.2d 231 (9th Cir. 1987); In re Grand Jury Subpoena Dated Dec. 10, 1987, 926 F.2d 847 (9th Cir. 1991). Other Circuits have not made this distinction. See, e.g., Conkling v. Turner, 883 F.2d 431, 433-34 (Sth Cir. 1988) (holding that, ’ Moreover, the First Circuit in Oberkoetter (612 F.2d at 16-18) and the Second Circuit in National Super Spuds, Inc. v. New York Mercantile Exchange, 591 viae’ - 78, 181 (oe Cie. 1979), both questioned the soundness of the Perlman doctrine, exhibiting an even deeper conflict in this area. 16 under Perlman, a district court’s order directing a party’s present and former attorneys to submit to limited depositions was a final, appealable order)*; Grand Jury Subpoena Duces Tecum Dated Jan. 2, 1965, T67 F.26. 26, 29 (26 Cae. 1965) 3.20 re Grand Jury Proceedings-Gordon, 722 F.2d at 305-07 (6tn... Cas. 1983) (present attorney in grand jury proceeding investigating possible tax crimes); In re Grand Jury Proceedings (Malone), 655 F.2d 882, 884-85 (8th Cir. 1981); In re Grand Jury Proceedings (Damore), 689 F.2d 1351, 1352 (11th Cir. 19862) (appears to be present attorney). The distinction between former and ® See also, In Re Grand Jury Subpoena (DeGuerin), 926 F.2d 1423, 1429-30 &n. 4 (Sth Cir. 1991), where the Fifth Circuit stated that the denial of a motion to quash a subpoena issued to the present attorney of a criminal defendant was immediately appealable, but dismissed the appeal as moot because the district court denied the government’s motion to hold the attorney in contempt. 17 present attorneys iS an unwarranted exception to the Perlman doctrine, and is violative of common sense. As the Fifth Circuit observed: "We suspect that the willingness of a lawyer to protect a client’s privilege in the face of a contempt citation will vary greatly, and have a direct relationship to the value of the client’s business and the power of the client in relation to the attorney. We are reluctant to pin the appealability of a district court order upon such precarious considerations. * * * * * Although we cannot not say that attorneys in general are more or less likely to submit to a _ contempt citation rather than violate a client’s confidence, we can _ say without reservation that some significant number of client- intervenors might find themselves denied all meaningful appeal by attorneys unwilling to make such a sacrifice. That serious consequence is enough to justify a holding that a client-intervenor may appeal an order compelling testimony from the client’s attorney." In re Grand Jury Proceedings (Fine), 641 F.2d 199, 202-03 (5th Cir. 1981) (footnote omitted; emphasis added). For similar reasoning, see Velsicol Chemical Corp. v. 18 Parsons, 561 F.2d 671, 674 (7th Cir. 1977), stating that "[iJt is one thing, however, for a lawyer to invoke the (attorney-client) privilege when called to testify...and quite another to expect an attorney to defy a court order directing him stify,”" (emphasis added) and that the subpoenaed attorney should not be expected to resist the court’s order compelling him to testify. The Fifth Circuit in Fine also disagreed with the First Circuit’s reasoning in Oberkoetter, supra, 612 F.2d at 18, that a "stouthearted" attorney might be willing to risk a contempt citation to protect his client’s interest. See 641 F.2d at 202. As discussed below, a non-attorney, independent contractor accounting firm working on a single-shot engagement is not going to commit contempt and the right of the client to appeal should not turn on such precarious 19 a KS considerations. However, such a "precarious consideration" is central to the Ninth Circuit’s decision. One of this Court’s functions is to Supervise lower federal courts. Justice Stevens has observed that; "As the Court of last resort in the federal system, we have supervisory authority and therefore must occasionally perform a pure error- correcting function in federal litigation." Florida v. Rodriguez, 469 U.S. 1, 7 (1984) (Stevens, J., dissenting). This supervisory role has been voiced aS a ground in granting certiorari. See, for example, Mallory v. United States, 354 U.S. 449, 450 (1957); Elkins v. United States, 364 U.S. 206, 208 (1960) (certiorari granted to consider a "question of importance for the administration of federal justice"); Hanna v. Plumer, 380 U.S. 460, 463 £(1965) (granting certiorari because of the 20 "threat to the goal of uniformity of federal procedure posed by the decision below"). Supreme Court Rule 10.1.(a) also recognizes the appropriateness of granting certiorari in this type of case. See R.L. Stern, et al., Supreme Court Practice § 4:15 at 191-92 (7th ed. 1993). This case involves an important question of federal appellate jurisdiction under a rule that was established by a decision of this Court. Thus, given the non-uniformity of the application of the Perlman doctrine among the circuits, this Court should grant the writ and establish a uniform rule among the circuits for the pre-disclosure appellate review of validly-asserted privileges. This Court has recognized the importance of, and has gone to great pains to establish, uniform procedures in situations where privileged communications and documents are affected. See, for example, United States v. Zolin, 21 491 U.S. 554 (1989), establishing uniform Procedures for invasion of the attorney- client privilege where the crime/fraud exception to the Privilege is raised. Also see, Reisman v. Caplin, 375 U.S. 440 (1964), creating the due process procedures for IRS administrative summonses, including the right of the taxpayer to intervene to assert privileges when the accounting firm’s workpapers were summoned and that the summons enforcement order is a final, appealable order, i.e. a uniform pre-disclosure appellate review procedures. See below for further discussion. This Court, and some circuit courts of appeals, have recognized that the Perlman doctrine applies to appeals involving subpoenas and orders to produce documents in grand jury proceedings. See Gravel v. United States, 408 U.S. 606, 608 n.2 (1972) (U.3s. Senator was allowed to 22 intervene in district court proceedings to quash subpoena issued to his assistant, and was allowed to appeal denial of his motion to quash under the Perlman doctrine; this Court noted that’ the government did not challenge the propriety of the appeal and that the Senator might be powerless to avert damage if not permitted to appeal). See also, In re Grand Jury Proceedings (Cianfrani), 563 F.2d 577, 580 (3d Cir. 1977) (similar facts to Gravel); National Mortgage Equity Corp. Mortgage Pool Certificates Litigation, 857 F.2d 1238, 1240 (9th Cir. 1968) (stating that "the reason for allowing review of such orders in the Grand jury context is that there are aspects of independence from the main course of any prosecution that render the order collateral"). This certainly applies to validly-asserted privileges, which once disclosed will be lost forever. 23 II. The Decision of the Court of Appeals Was Erroneous and Violates Perlman and other Decisions of this Court. In Perlman (247 U.S. 7 (1918)), documents belonging to Perlman and his corporation were impounded by a district court clerk in an unrelated civil case. The United States Attorney instituted grand jury proceedings against Perlman and requested that the documents be turned over to him. The District Court so ordered. Perlman challenged the order and the United States argued on appeal that the order was not final. 247 U.S. at 12- ‘& 2 This Court rejected that argument, stating that it was unable to concur that Perlman, although powerless to avert the mischief of the order, must accept its incidence and seek a remedy at some other time and in some other way. Thus, the District Court’s order was immediately appealable. Id. at 13. This Court affirmed the Perlman 24 doctrine’s vitality of in United States v. Nixon, 418 U.S. 683, 691 (1974). See also, Church of Scientology v. United States, U.S. ; » aoe Br Gen Sets 452 n. 11, 121 L.Ed.2d 313 (1992), stating that "under the so-called Perlman doctrine,..., a discovery order directed at a disinterested third party is treated as an immediately appealable final order because the third party presumably lacks a sufficient stake in the proceedings to risk contempt by refusing compliance." (citation omitted.) This certainly applies to an independent accounting firm hired on a one-shot engagement. It will not commit contempt so an appeal can be brought. In California, attorneys are required by law to "maintain inviolate the confidence, and at every peril to himself or herself to preserve the secrets, or his or her client." Cal. Bus. & Prof. Code § 25 Pt Sl TES el tt Se eG Rica Negitlltn aah ae E N le aS SOT A De NC OO ns ati te alan. int it ety tty AEB ain A iit neat. sonteitee e oN 6068(e) (Deerings 1993). Accountants are in a different situation. They are under a mandatory, statutory duty to comply with subpoenas ordered enforced by a court under pain of license revocation and fines.’ Cal. Code of Regulations tit. 16, § 54 requires that no information obtained by a licensee, in his or her professional Capacity, concerning a client or a 7 In California, an accountant who violates the regulation requiring disclosure of client materials pursuant to a court order could be subject to a number of disciplinary penalties. For instance, he or she could be subject to fines of $200 to $2000. Cal. Code meg. tit. 16, § 95.2. An accountant could also be subject to suspension or revocation of a permit or certificate required for practice. Cal. Bus. & Prof. Code § 5100(f) (Deerings 1993). Violation of § 5100(f) could also result in fines of $500 to $2500. Cal. Code Reg. tit. 16, § 95.2. Moreover, the revocation or suspension of a partner’s right to practice accountancy could result in the revocation, suspension, or refusal to renew the permit of an accountancy partnership. Cal. Bus. & Prof. Code § , 5101 (Deerings 1993). For the sake of brevity, Petitioners are omitting discussion of what professional discipline can result from the criminal conviction of an accountant. 26 prospective client shall be disclosed without the permission of the client or prospective client, except for (a) disclosures made in compliance with a subpoena or a summons enforceable by order of a court; and (b) disclosures made in response to an official inquiry from a federal or state regulatory agency. Thus, the Ninth Circuit incorrectly required the accounting firm to commit contempt in order to obtain review of the District Court’s order. The Ninth Circuit is essentially counseling accountants to break the law. It is clear that the accounting firm squarely falls within the Perlman rule and the District Court’s order is final and appealable. Instructive on the issue of whether a third-party witness should be expected to commit contempt is this Court’s opinion in Eastland v. United Servicemen’s Fund, 421 U.S. 491, 501 n.14 (1975), noting that the 27 cnsur-7 toe wares Court of Appeals for the District of Columbia had properly distinguished between a subpoena that seeks information directly from a party and one that seeks the same information from a third person. In the former case, the party can resist and test the subpoena; but in the latter, compliance by the third person could frustrate any judicial review.’ In opposition to Petitioners’ motion for a stay in the District Court, the United States cited three Ninth Circuit cases it argued held that where the third party subpoena is issued to the current attorney of a grand jury target, the attorney, because of his or her ® See also, J. Marshall’s concurrence in that opinion, 421 U.S. at 514, in which he cites Perlman and states that the district court properly entertained the action in order to provide a forum in which the respondent could assert its constitutional objections to the subpoena, Since "a neutral third party could not be expected to resist the subpoena by placing itself in contempt." 28 relationship to the client/target, should be willing to commit contempt in order to create a final, appealable order. See Citations, supra, at 16. The United States argued that these cases, by analogy, applied to the instant situation and supported its position that the order in this matter was not final for purposes of appeal. In granting Petitioners’ request for a temporary stay, however, the District Court noted that these cases were distinguishable from this case because they "find current attorneys of the person asserting the privilege to be persons expected to risk a contempt citation App., infra, 33a (emphasis added). This is correct. Bailin and his firm are third party independent accountants under a limited engagement that does not include 29 er i ines Pe eae eee agreeing to commit contempt and go to jail so that Petitioners can appeal. There is no evidence in the record to the contrary. Moreover, no independent, third party CPA in his or her right mind would agree in advance to such a condition as part of an engagement. In fact, such an agreement would violate California law and would be a void, unenforceable contract, Analysis of the cases cited by the United States reveals clear distinctions between them and the instant case. See In re Grand Jury Subpoena Served Upon Niren, Supra, 784 F.2d 939; In re Grand Jury Subpoena Dated June 5, 1985, supra, 825 F.2d 231; In re Grand Jury Subpoena Dated Dec. 10, 1987, supra, 926 F.2d 847. This narrow carve-out of the Perlman doctrine for current attorneys is inapplicable to the facts of this case because Bailin is not the target’s attorney, he is an independent contractor hired by the 30 attorney for the instant investigation. None of these cases involves a similar or analogous situation. In Niren, for example, the attorney- witness was in-house counsel to the grand jury target. Therefore, the attorney was the equivalent of a common-law employee of the target and under the target’s control. In fact, The Ninth Circuit analogized Niren’s situation to that of an employee in making its holding. 784 F.2d at 940- 941. This case presents a different Situation. The witness is an independent contractor CPA hired to perform specific duties for the attorney on a one-shot basis. The level of control exercised by Petitioners is not even close to the level of control exercised by an employer over a common-law employee, such as the in-house counsel in Niren. The other two case are equally inapplicable. Authority for the appealability of 31 ee oe ee the District Court’s order may also be found in this Court’s decision in Reisman v. Caplin, supra, 375 U.S. 440. In Reisman, the IRS was seeking to subpoena the workpapers of an accounting firm that had been hired by an attorney to work with him in the defense of his client in Ongoing criminal and civil tax matters. The accounting firm was served with the equivalent of a grand jury subpoena--an administrative summons to appear before an IRS Special Agent.*® Id. at 443-444. The attorney tried to intervene and object to the compliance with the summons. The District Court ordered enforcement of the ° In United States v. Powell, 379 U.S. 48, 57 (1964), this Court hel that an IRS administrative summons is_ the legal equivalent of a grand jury subpoena, and the same rules apply. Powell relied on prior decisions of this Court involving summonses issued by other governmental agencies holding that this type of process is the same as a grand jury subpoena. See United States v. Morton Salt Co., 338 U.S. 632, 642-43 (1950); Oklahoma Press Pub. Co. v. Walling, 327 U.S. 186 (1946). 32 IRS summons against the accountant. This Court ruled that any person affected by the disclosures or production could intervene and raise objections on any appropriate ground, including privilege. This Court also ruled that the order compelling compliance by the accountant was a final appealable order. Id. at 449. The instant case is factually and procedurally the same as Reisman. As in Reisman, the IRS is conducting a criminal investigation here. The attorney in Reisman, as in this case, hired an independent accounting firm to assist in the defense of the tax investigation. The instant dispute started with an IRS summons seeking the very information now sought by the grand jury subpoena. Petitioners intervened at the administrative level and asserted privileges as expressly authorized by Reisman. 33 The United States, however, did not seek enforcement of the IRS summons in the District Court. It issued a grand jury subpoena, which is the legal equivalent of an IRS summons. See fn. 9, supra. Petitioners moved to intervene in the District Court and to assert again their privilege objections. Thus, Reisman compels the same result in this case--an immediate appeal of the privilege issues. The United States should not be allowed to avoid enforcement of the administrative summons by issuing a grand jury subpoena, and thus to deprive Petitioners of the Opportunity to test the legality of the order to the accountant to turn over the proven-privileged documents that they clearly would have had under Reisman if the United States had sought enforcement of the original summons. The Ninth Circuit’s opinion ignores this dispositive case, because it cannot distinguish it. 34 It is important to note that a grand jury subpoena and an IRS summons end up in the same place for enforcement--the District Court using itS powers via a court order to compel compliance. It is this enforcement order that is appealed. So it should make no difference for purposes of appellate jurisdiction if the order enforces a grand jury subpoena or its legal equivalent--an IRS summons. III. The Decision of the Court of Appeals Poses Serious Consequences for the Criminal Justice System, and the Legal and Accounting Professions, Because at, Practically Speaking, Allows the United States to Invade Validly-Established Communicative and Work-Product Privileges Prior to any Appellate Review, Thus Prejudicing the Defendant’s Right to Counsel and the Preparation of a Defense. In United States v. Nobles, 422 U.S. 225, 238 (1975), this Court observed that "Co]ne of those realities [of litigation in our adversary system] is that attorneys must often rely on the assistance of investigators and other agents in the 35 compilation of materials in preparation for trial." Since 1975, this statement has come to even more accurately describe the modern practice of law. As our world becomes more complicated, the less able attorneys are to investigate the facts of a case and prepare for trial by themselves. In many litigations, large and small, a cadre of independent contractors assist the attorney to understand the facts and prepare for trial or settlement negotiations. Most of these agents are independent contractors. The Ninth Circuit’s opinion creates a dangerous precedent because attorneys will be less willing to hire needed outside personnel, such as accountants and other investigators. Also, independent contractor agents will be less willing to accept litigation support work. If the independent contractor agent is subpoenaed to testify about his or her work for the 36 attorney, the opposing party (i.e., the United States) will be able to invade privilege and to secure privileged documents and communications. This is true because few independent contractors will be willing to commit contempt, and suffer fines, jail or license revocation, in order to preserve the attorney’s and the client’s appeal rights. This, in turn, denies a defendant the needed technical help in defense of a criminal investigation. As discussed above (see pp. 13-16), the circuits are undecided as to whether an attorney, who has an obligation to protect his or her client’s confidences at his or her own risk, should be willing to disobey a court order to disclose privileged material. Common sense dictates that other professionals, such as accountants, who do not have the same professional obligations to maintain 37 client confidences (see fn. 7, ante), will be even less willing to risk contempt by disobeying a court order to disclose privileged material. As the Fifth Circuit has noted, supra at 18, appealability of such orders should not turn on such a "Capricious circumstance." This is further demonstrated by the fact that the Perlman doctrine has been applied to non-attorney third-party record keepers. This includes accountants and accounting firms,’ medical *° See, for example, Wm. T. Thompson Co. v. General Nutrition Corp., 671 F.2d 100, 102-03 (3d Cir. 1982); In re Grand Jury Proceedings (Manges), 745 F.2d 1250, 1253: n.2 (Sth cir. 1984) ; In re International Systems & Controls Corp. Securities Litigation, 693 F.2d 1235, 1238 n.1 (Sth Gar. 1982) ; Matter of International Horizons, Inc., 689 F.2d 996, 1000-02 & n. 11 (11th Cir. 1982). But see, Matter of Grand Jury Subpoena, S69 N.E.2d 852, 854 (Mass.App. 1991), declining to apply the Perlman doctrine to an independent accounting firm. 38 professionals,*? corporate employees, ~* banks,’? and governmental agencies.** Thus, the Court of Appeals’ opinion raises serious questions affecting more than the _ 12 See In re Grand Jury Proceedings, 867 F.2d 562, 564 (9th Cir. 1989), cert. den., 493 U.S. 906, rehearing den. 493 U.S. 985 (1989) (grand jury target could appeal an order denying motions to quash subpoenas issued to her psychiatrist and two hospitals). ” See, e.g., In re Grand Jury Subpoena Duces Tecum, 769 F.2d 52, 54-56 (2d Cir. 1985); In re Grand Jury (C. Schmidt & Sons), 619 F.2d 1022, 1024-25 (3a Cig. 2960). But see, Corporacion Insular de Seguros v. Garcia, 876 F.2d 254, 258-60 (list Cir. 1989); In re Burlington Northern, Inc., 679 F.2d 762, 767-68 (8th Cir. 1982); National Super Spuds v. New York Mercantile Exchange, 591 F.2d 174 (2d Cir. 1979), all holding that employees could be expected to _ risk contempt to secure appellate review of their employer’s claim of privilege. This is yet another example of the confusion Surrounding the scope of the Perlman doctrine and how the circuits are split over many aspects of its application. 13 Harris v. United States, 413 F.2d 316, 316-17 (9th Cir. 1969). 4 ~—s Castle v. Sangamo Weston, Inc., 744 F.2d 1464, 1465-66 (llith Cir. 1984) (per curiam). 39 constitutional rights and immediate interests of the parties involved. All professionals who supply litigation support services are potentially affected. Once, disclosure of privileged material has occurred, "the bell cannot be unrung." Thus, Bailin’s compliance would moot, prejudice and waive the question of the application of the attorney-client and work-product privileges. See, eé.g., Admiral Ins. Co. v. United States District Court, 881 F.2d 1486, 1491 (9th Cir. 1989) (granting juded bit ive writ and citing the "irreparable harm a party likely will suffer if erroneously required to disclose privileged material or communications") ; United States Dep’t. of Energy v. Brimmer, 776 F.2d 1554, 1558-59 (Em.App. 1985), cert. den. 475 U.S. 1045 (1986) (stating that mandamus is appropriate to review substantial claims of privilege because review by later appeal cannot undo harm 40 done by disclosure); Iowa Beef Processors, Inc. v. Bagley, 601 F.2d 949, 955 fn. 7 (9th Cir. 1979) (stating that "disclosure of allegedly privileged or confidential information renders impossible any meaningful appellate review of claim of privilege or confidentiality"); In re Grand Jury | Investigation of Ocean Transportation, 604 F.2d 672, 674 (D.C. Cir. 1979) (stating that without prior appellate review of claim of attorney- client privilege, party would be subjected to "the irreparable loss of its right to claim the attorney-client privilege"); In re von Bulow, 828 F.2d 94, 98 (2d Cir. 1987) (stating that compliance with discovery order against claim of privilege destroys the right sought to be protected.) Compliance with the District Court’s order would clearly result in irreparable injury to the attorney-client relationship between Ord and the Clients. 41 The Ninth Circuit’s decision is dangerous because it equates independent contractors with employees by invoking National Super Spuds Vv. New York Mercantile Exchange, 591 F.2d 174 (2d Cir. 1979), and other cases involving employees (including in-house counsel). See App., infra, at 4a. If Bailin, an independent contractor hired on a project-by-project basis, is the equivalent of the high ranking Commodity Futures Trading Commission official in National Super Spuds, or the in-house counsel in Niren, supra, at 31, any person hired to assist an attorney is placed in the same position as an employee of the attorney, or of the client. That Bailin and his firm had also been the Clients’ tax preparer is of no import, because this past role was separate from their role as Ord’s independent contractor. The Ninth Circuit’s opinion is also ° 42 dangerous because it has the potential to allow the United States to invade the attorney-client privilege and the attorney work-product doctrine with impunity. All the United States and the IRS need do is determine who assisted the attorney in preparing for litigation and subpoena that person before the grand jury, rather than using an administrative summons, the judicial enforcement of which results ina final appealable order. The witness will not commit contempt and suffer fines and jail to preserve the clients’ and the attorneys’ privileges and appeal rights. This situation puts at risk decades of court decisions protecting the attorney-client privilege and the attorney worx-product doctrine. It runs counter to federal courts’ attempts to zealously protect documents within the scope of the attorney-client privilege. See Haines v. Liggett Group, Inc., 975 F.2d 81, 90 (3rd 43 Gar. 1992); Klitzman, Klitzman and Gallagher v. Krut, 744 F.2d 955, 960 (3d Cir. 1984). It also has ramifications for the right to counsel, because it could create an atmosphere of distrust between the client and the attorney and the attorney’s agents. For example, this Court held in Upjohn Co. v. United States, 449 U.S. 383 (1981), a case with parallel, but less compelling, facts, that the attorney- client privilege covers information communicated to counsel by corporate employees for the purpose of enabling counsel "to give sound and informed advice" to the corporation. Id., at 390. In Upjohn, private accountants did an internal audit and discovered possible illegal payments to foreign officials. Similarly, in this case, the impetus for the internal corporate investigation came from an outside source. The accountants 44 informed the corporation’s general counsel, who conducted an internal investigation of these "Questionable payments." Similarly, in this case, the company conducted an internal investigation into "questionable" cash payments. It is the work product of this investigation, conducted by the accounting firm hired by the attorney, that the United States seeks in this case. During the investigation, Upjohn’s general counsel and corporate employees generated communications and documentation. The investigation involved a questionnaire sent to all the corporation’s "foreign general and area managers," and interviews with the recipients of the questionnaire and some 33 other Upjohn officers or employees. Upjohn then made a public filing with the Securities and Exchange Commission in the form of a "preliminary" report 45 oe ey disclosing certain questionable payments. It simultaneously served a copy on the IRS. This triggered an investigation. Just as in this case, the IRS issued an administrative summons seeking production of all the files, records, memoranda and notes underlying the corporation’s internal investigation. In reviewing an appeal from the subsequent IRS summons enforcement order, this Court rejected the Sixth Circuit’s limited view of the attorney-client privilege, opting for broad application of the privilege in order not to discourage persons’ in corporations from providing information and generating documents to pass on to corporate counsel. This allows corporations to receive proper advice during an ongoing investigation and to comply with the law on an ongoing basis. 449 U.S. at 390-93 & fn. 2. In reaching its holding, this Court 46 recognized the importance of the attorney- client privilege to the public interest and to the administration of justice: "The attorney-client privilege is the oldest of the privileges for confidential communications known to the common law. S a. Wigmore, Evidence § 2290 (McNaughton rev. 1961). Its is to encourage frank and full communication between attorneys and their clients and thereby promote broader public interests in the observance of law and administration of justice. The privilege recognizes that sound legal advice or advocacy serves public ends and that such advice or advocacy depends of the lawyer’s being fully informed by the client. As we stated last Term in Trammel v. United States, 445 U.S. 40, 51 (1980): ‘The lawyer- client privilege rests on the need for the advocate and counselor to know all that relates to the client’s reasons for seeking representation if the professional mission is to be carried out.’ And in Fisher v. United States, 425 U.S. 464, 470 (1976), we recognized the purpose of the privilege to be ‘to encourage clients to make full disclosure to their attorneys.’" 449 U.S. at 389. (emphasis added.) This Court also held that counsel’s 47 en ew eh A. hots Mesos notes and memoranda were work product based on oral statements of the witnesses. Where they revealed communications by witnesses, they were protected by the attorney-client privilege. 449 U.S. at 397-401. To the extent that the notes and memoranda do not reveal witness communications, they reveal counsel’s mental processes in evaluating the communications, and thus were protected from disclosure by the attorney-work product doctrine. Id. This Court also noted that the United States in Upjohn was not without recourse in the face of the company’s valid assertions ‘of privilege. It noted that the government was free to duplicate the company’s investigation and question the employees who communicated with counsel. 449 U.S. at 396 (emphasis added). The United States in this appeal is also free to conduct its own investigation. It 48 should not be able to secure the privileged work product of an accounting firm hired by the corporate attorney by the simple expedient of subpoenaing the accountant, knowing that the firm will not and cannot commit contempt in order to preserve privileges belonging to. the hiring attorney and his client. The Ninth Circuit’s opinion could potentially allow the IRS to achieve this result and to circumvent this Court’s rulings regarding the attorney-client and work-product privileges in Upjohn and other cases. Finally, because the underlying factual pattern involves a common factual Situation in IRS investigations--the IRS suggesting possible lines of inquiry for taxpayers--the District Court’s decision will chill taxpayer cooperation in tax investigations. The District Court’s opinion is revolutionary because it holds that an accountant and his firm working 49 hl _ Cwatt eateht ER A oS OS ee for the attorney in an investigation are actually working for the IRS when answering an IRS agent’s questions. Thus, neither the work product behind the answer nor the internal communications and advice behind answering the questions of the IRS agent are covered by privilege. When confronted with such a Situation, many taxpayers will be unwilling to cooperate in any investigation. Voluntary cooperation in civil audits and litigation will greatly diminish. This is because in answering any question Suggested or posed by the IRS, the taxpayer or his agents may be deemed to be working for the IRS and thus all communication and work product behind the answer would not covered be by the law of privilege. Thus, the District Court’s opinion is clearly wrong, dangerous and should have been reviewed by the Court of Appeals, either through direct appeal or through a writ of 50 mandamus, see Part IV., infra. IV. The Ninth Circuit’s Denial of Petitioners’ Petition for a Writ of Mandamus Conflicts with Other Circuits’ Rulings Recognizing that Mandamus Is Appropriate to Review Validly-Asserted Privileges Prior to Compelled Disclosure. The Ninth Circuit’s denial of Petitioners’ petition for a writ of mandamus focuses too narrowly on two older cases that denied writs of mandamus to review denials of motions to quash grand jury subpoenas,’° and also ignores numerous later court decisions finding that mandamus iS proper to- review questions of privilege before disclosure of the privileged materials to avoid waiver of the privilege. Mandamus has also be used to review disputes arising in grand jury proceedings. The Ninth 18 See App., infra, at 18a, citing Lampman v. United States District Court, 418 F.2d 215 (9th Cir. 1969), cert. den. 397 U.S. 919, 935 (1970) and City of Los Angeles v. Williams, 438 F.2d 522 (9th Cae. 2974}. S52 Circuit’s refusal to allow review by writ in this case illustrates the conflict among the circuits with regard to the application of mandamus to these areas. Moreover, one case relied on by the Ninth Circuit used an_ unreasonably expansive reading of one of this Court’s decisions to find that mandamus is not available to review denial of motions to quash grand jury subpoenas. City of Los Angeles v. Williams, 438 F.2d 522 (9th Cir. 1971), cited by the Ninth Circuit at App., infra, 18a-19a, hinged on the Ninth Circuit’s erroneous reasoning that this Court’s decision in Will v. United States, 389 U.S. 90 (1967) held that privilege does not enjoy a special status in considering a petition for an extraordinary writ. See 438 F.2d at 522- $33. Not only do Petitioners not read Will as containing such a holding or even such an implied holding or dicta, later 52 cases (see discussion, infra) have shown that mandamus is particularly appropriate to review orders compelling disclosure of information claimed to be protected by the Constitution, privilege, or more general interests of society. See, generally, C.A. Wright, et al., 16 Federal Practice and Procedure § 3935 at 247-48 (1977). Thus, the principle underpinning Williams and the Ninth Circuit’s opinion, which relies on Williams, is based on too expansive a reading of Will. Certiorari is appropriate for this Court to determine the application of mandamus to court orders compelling disclosure of privileged materials and communications. | Many courts have found mandamus to be appropriate to secure appellate review of discovery orders involving important questions of law. See, for example, In re Burlington Northern, Inc., 822 F.2d 518, 522 (Sth Cir. 1987), cert. den. 484 U.S. 53 1007 (1987), stating that "(T]he difficulty of obtaining effective review of discovery orders, the serious injury that sometimes results from such orders, and the often recurring nature of discovery issues support use of mandamus in exceptional cases." See also, Schlagenhauf v. Holder, 379 U.S. 104 (1964) (mandamus proper to review novel question involving Federal Rules); In re von Bulow, 828 F.2d 94, 97 (2d Cir. 1987); United States v. United States District Court, 717 F.2d 478, 481-82 (9th Cir. 1983) (mandamus used to set aside order in criminal proceeding requiring the government to produce documents under the Freedom of Information Act); In re Societe National Industrial Aerospatiale, 782 F.2d 120, 123 (8th Cir. 1986), vacated on other grounds, 482 U.S. 522 (1987) ("mandamus is appropriate to provide guidelines for the resolution of novel and important 54 questions presented in the discovery order that are likely to recur"); Iowa Beef Processors, Inc. v. Bagley, 601 F.2d 949, 953-55 & fn. 7 (9th Cir. 1979) (stating that a rationale for invoking mandamus to review privilege questions is that "disclosure of allegedly privileged or confidential information renders impossible any meaningful appellate review of the claim of privilege or confidentiality"). See, generally, C.A. Wright, et al., 15B Federal Practice and Procedure § 3914.23 at 132-133 (2d ed. 1992), 16 Federal Practice and Procedure § 3935 at 246-251 (1977). Orders regarding discovery matters are uniquely suited to mandamus review because they are generally considered to be interlocutory and non-appealable. See City of Las Vegas v. Foley, 747 F.2d 1294, 1296-97 (9th Cir. 1984). This is because the finality rule often prevents appellate ao Oe review of even oft-occurring discovery problems that plague district courts. See C.A. Wright, et al., 15B Federal Practice and Procedure § 3914.23 at 132-133 (2d ed. 1992). Thus, mandamus, because of its extraordinary and discretionary nature and its use in a supervisory or advisory role,*® presents the most direct and advantageous way to provide appellate review of discovery orders when such review is needed. See C.A. Wright, et al., 16 Federal Practice and Procedure § 3934 at 235 (1977), stating that "{ilmportant questions of procedure are often difficult to review by appeal, and - See Will v. United States, 389 U.S. at 107 (mandamus serves a "vital corrective and didactic function"). See also, C.A. Wright, et al., 16 Federal Practice and Procedure § 3934 at 235 (1977), wherein the authors state that the statements in Will "seem to reiterate the Court’s acceptance of writ review...by which courts of appeals may supervise practice on issues that otherwise may elude prompt or effective appellate scrutiny." 56 at times may demand appellate intervention to secure uniformity between different judges, or simply bring the balancing perspective that appellate review is intended to provide in controlling the practice as well as the substantive decisions of trial courts." Many courts have also found mandamus to be an appropriate remedy to deal with questions regarding the attorney-client privilege because "maintenance of the attorney-client privilege up to its proper limits has substantial importance to the administration of justice, and because an appeal after disclosure of the privilege communication is an inadequate saneie* Harper & Row Publishers, Inc. v. Decker, 423 F.2d 487, 492 (2d Cir. 1970), affirmed by an equally divided court, 400 U.S. 348 (1971). See also, Haines v. Liggett Group, Inc., 975 F.2d 81, 88-91 (3rd Cir. 1992); Chase Manhatten Bank, N.A. v. 57 ea Turner & Newhall, PLC, 964 F.2d 159, 163 (2d Cir. 1992); Admiral Ins. Co. v. United States District Court, 881 F.2d 1486, 1491 (9th Cir. 1989), and the cases cited therein; Diversified Industries, Inc. v. Meredith, 572 F.2d 596, 606 (8th Cir. 1977) ("where a claim of attorney-client privilege has been raised in and rejected by a district court,... mandamus is available as a means of immediate appellate review"). Mandamus has also been held to be appropriate for review of orders requiring discovery of information claimed to be privileged under other theories or where other important interests are at stake, on the grounds that irreparable harm will occur if the information is disclosed. See, e.g., In re Steinhardt Partners, L.P., 9 F.3d 230, 233 (2d Cir. 1993) (question of whether work-product protection iS waived by voluntary disclosure to government agency 58 presents "one of those rare circumstances permitting the use of mandamus to review a district court order"); United States v. Victoria=2i,. 3 F.3@ S7i, S75 ‘ee. Cit. 1993); Westinghouse Electric Corp. vv. Republic of Philippines, 951 F.2d 1414, 1422 (3d Cir. 1991) (mandamus found to be suitable means of reviewing order compelling discovery on ground that prior disclosure to different adversary had waived privileges); In re Fink, 876 F.2d 84 (11th Cir. 1989) ("{iJn the context of discovery orders which will compromise a claim of privilege or invasion of privacy rights, mandamus has been found appropriate due to the importance of the privilege, the seriousness of the injury if discovery is obtained, and the difficulty of obtaining effective review once the privileged information has been made public"); In re United States, 872 F.2d 472 (D.C.Cir. 1989), cert. dism’d. 59 re 493 U.S. 960 (1989) (mandamus was proper to review district court’s determination that claim of state secrets privilege should be decided on item-by-item basis) ; United States Dep’t. of Energy v. Brimmer, 776 F.2d 1554, 1558-59 (Em.App. 1985), cert. den. 475 U.S. 1045 (1986) (order to produce internal government documents, rejecting claim of governmental privilege, set aside by mandamus); Sporck v. Peil, 759 F.2d 312, 314-15 (3d Cir. 1985), cert. den., 474 U.S. 903 (1985) (mandamus was appropriate to set aside an order to product a set of documents selected by counsel to prepare for deposition; the work product questions presented invoked mandamus’ instructional goals and discharge of the court’s supervisory function); Bogosian v. Gulf Oil Corp., 738 F.2d 587 (3d Cir. 1984); Iowa Beef Processors, Inc. v. Bagley, 601 F.2d 949, 953-54 (9th Cir. 1979), and the cases 60 cited therein. Because of its appropriateness for review of discovery orders and orders affecting privilege, a number of circuit courts of appeals have used mandamus to review orders inv iving grand jury disputes. See, for example, In re Oswalt, 607 F.2d 645, 648 (Sth Cir. 1979) (mandamus issued to correct order that authorized direct seizure of documents subpoenaed by grand jury); United States v. RMI Co., 599 F.2d 1183, 1185-87 (3d Cir. 1979) (mandamus was proper method to challenge district court’s refusal to consider request for protective order against disclosure of documents that non- party produced before grand jury); In re Grand Jury Subpoenas, April 1978, at Baltimore, 581 F.2d 1103, 1106-1110 (4th Cir. 1978); Nixon v. Sirica, 487 F.2d 700, 707 (D.C.Cir. 1973) (mandamus used to review propriety of district court order 61 a to produce allegedly-privileged documents in camera); United States v. United States District Court, 238 F.2d 713 (4th Cir. 1956), cert. den. 352 U.S. 981 (1957) (holding that courts of appeals may grant relief by way of writ of mandamus to order a district court to vacate an order quashing a subpoena for production of records before a grand jury). One Circuit has even commented that mandamus would be an appropriate route for clients seeking to challenge a District Court’s denial of their motion to quash a grand jury subpoena without having to wait fora contempt citation. See In re Grand Jury Proceedings, Subpoena to Vargas, Supra, 723 F.2d at 1464-66. Mandamus is an appropriate avenue to assure that important questions of privilege arising in the grand jury context are reviewed by appellate courts prior to court-enforced disclosure of the 62 privileged materials or communications. This avoids waiver of privileges and allows early resolution of privilege questions without the necessity of proceeding through a criminal prosecution before the questions can be heard by the appellate court. ONCL ON This Court must establish a uniform procedure for the pre-disclosure appellate review of validly-asserted privileges, either through appeal by right or by writ. For all the reasons given above, this Court should grant this Petition for Writ of Certiorari. Respectfully submitted, EDWARD 0O.C. ORD Counsel of Record ORD & NORMAN 650 California Street, 26th Floor San Francisco, CA 94108 415/274-3800 Counsel for Petitioners June 1995 63 APPENDIX 1. Opinion of Court of Appeals 2. District Court Memorandum of Decision and other Orders 3. Initial Stay Order by Court of Appeals 4. Court of Appeals Denial of Rehearing Be lala ee SRLS Ltt Cate ashes adn alee et FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT IN RE: GRAND JURY ) SUBPOENA ISSUED TO ) CHARLES D. BAILIN EDWARD SILVA, JUR.; SILVA HARVESTING INC.; EDWARD O.C. ORD, INC.; ORD & NORMAN, Appellants, Vv. UNITED STATES OF AMERICA, Appellee. EDWARD SILVA, JR. an individual; SILVA HARVESTING INC.; et al., Petitioners, we UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA, Respondent, UNITED STATES OF AMERICA, ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) eee eee 2a No. 94-16684 D.¢c. HO. CV-94-7008-WAI No. 94-70757 D.¢. Be. CV-94-7008-MISC OPINION Real Party ) in Interest. _) Appeal from the United States District Court for the Northern District of California William A. Ingram, Chief Judge, Presiding Argued and Submitted December 12, 1994 San Francisco, California Filed March 28, 1995 Before: J. Clifford Wallace, Chief Judge; Harry Pregerson and Robert R. Beezer, Circuit Judges. Opinion by Judge Beezer SUMMARY Criminal Law and Procedure/Discovery/Appeals The court of appeals dismissed an appeal and denied a petition. The court held that it lacked jurisdiction over an appeal of the district court’s denial of a motion to quash a grand jury subpoena directed at the movant’s tax accountant. The Internal Revenue Service (IRS) investigated cash payments received by 3a appellant Edward Silva, Jr. Silva retained an attorney in connection with the investigation. The attorney retained Charles Bailin, Silva’s tax accountant, to aid him in representing Silva. An IRS agent met with Bailin and gave him a list of cash transactions which she stated had been paid to Silva’s company. She requested that Bailin trace the payments into Silva's records to determine whether they had been reported as income. Bailin did the investigation. A criminal investigation ensued. The United States Attorney initiated a grand jury investigation. The grand jury issued a subpoena duces tecum to Bailin demanding production of all of his workpapers relating to the cash tracing and all of his notes of his conversations with the IRS agent, Silva and Silva’s employees relating to the investigation. Silva filed a motion to quash the 4a subpoena directed at allegedly privileged records of Bailin. The district court denied the motion. Silva appealed. Silva also attempted to obtain review of the district court’s ruling through a petition for an extraordinary writ under the All Writs Act. The government moved to dismiss the appeal for lack of jurisdiction. [1] The order at issue in this case was not appealable. [2] Generally, the denial of a motion to quash a subpoena is a monappealable interlocutory order. There is a narrow exception to this rule where the subpoena is directed at a third party who "cannot be expected to risk a contempt citation" in order to preserve the movant’s right to appeal. [3] The exception did not apply in this case. Bailin was retained by Silva’s attorney to ‘represent Silva in a confidential, fiduciary capacity. He has remained + i “a Sa Silva’s agent throughout the proceedings and is, therefore, subject to Silva's control to some degree. More importantly, Bailin is necessarily a party to the relationship upon which Silva’s entire claim of privilege is based. In such circumstances, a third party can be expected to risk contempt in order to protect the privileged relationship. [4] It did not matter that Bailin is an accountant rather than an attorney. [5] This case was not an appropriate one in which to apply the doctrine of "hypothetical jurisdiction." The ‘government ’s own arg ment revealed that resolving the appeal on the merits, rather than dismissing 3 for lack of jurisdiction, would affect the outcome. [6] Silva’s petition for review of the district court’s order by extraordinary writ also failed. The Ninth circuit has rejected attempts to use the 6a All Writs Act as a means of avoiding the final judgment rule in the context of motions to quash grand jury subpoenas. (7] There was no judicial "usurpation of power" in this case. COUNSEL Edward 0O.C. Ord, Ord & Norman, San Francisco, California, for the appellants- petitioners. Leo P. Cunningham and Daniel Graber, Assistant United States Attorneys, San Jose, California, for the appellee-real party in interest. OPINION BEEZER, Circuit Judge: Edward Silva, Silva Harvesting Inc. (collectively "Silva"), Edward 0.C. Ord, Inc. and Ord & Norman appeal the district court’s denial of their motion to quash a grand jury subpoena duces tecum directed 7a at allegedly privileged records of Charles Bailin, Silva’s tax accountant. Silva also attempts to obtain review of the district court’s ruling through a petition for an extraordinary writ under the All Writs Act, 28 U.S.C. § 1651. We dismiss the appeal for lack of subject matter jurisdiction and deny the petition. I Bailin has been Silva's tax accountant for several years. In mid- 1992, Bailin became aware that an agent of the Internal Revenue Service ("IRS"), Elizabeth Davis, was investigating a large number of cash payments received by Silva. Bailin recommended to Silva that Silva retain attorney Edward 0.C. Ord iin connection with the investigation, which Silva did in April 1992. Shortly thereafter, Ord retained Bailin to aid him in representing Silva in the investigation. Bailin testified that all actions he took after Ord was retained were at Ord’s direction. The district court found that Bailin was Ord’s agent at all times relevant to these proceedings. In July 1992, Davis met with Bailin and gave him a list of ten cash transactions which she stated had been paid to Silva Harvesting. She requested that Bailin trace the payments’ into Silva’s records to determine whether they had been reported as income. She candidly informed Bailin that she suspected Silva of using the cash illegally. Bailin did the investigation, and apparently could not trace all of the payments into Silva’s books. Bailin revealed this fact to Davis at Ord’s direction. A criminal investigation ensued, and eventually the United States Attorney initiated a grand jury investigation. The grand jury issued a subpoena duces tecum to Bailin demanding production, among 9a other things, of all of his workpapers relating to the cash tracing, and all of his notes of his conversations with Davis, Silva and Silva’s employees relating to the investigation. Silva initiated the instant action in response to the subpoena. The district court denied Silva’s motion to quash the subpoena. The United States moved to dismiss the appeal for lack of jurisdiction. ae [1] Silva contends that the district court’s denial of the motion to quash the Subpoena is appealable because Bailin was a "third party." The appealability of such an order where the subpoenaed party is a nonattorney agent of the movant is a question of first impression in this circuit. We hold that the order at issue here is not appealable. A 10a [2] Generally, the denial of a motion to quash a subpoena is a nonappealable interlocutory order. United States v. Ryan, 402 U.S. 530, 532-33 (1971). In order to appeal the order, the person subpoenaed must refuse to comply and contest the validity of the subpoena by appealing a contempt determination. Id. There is, however, a narrow exception to this rule where the subpoena is directed at a third party who "cannot be expected to risk a contempt citation" in order to preserve the movant’s right to appeal. In re Grand Jury Subpoena Served Upon Niren, 784 F.2d 939, 941 (9th Cir. 1986) (citing Perlman v. United States, 247 U.S. 7, 15 (1918)). We have previously held that the Perlman exception does not apply where the subpoena is directed at an attorney who is currently representing the party moving to quash the subpoena in connection with the lla grand jury proceedings. Niren, 784 F.2d at 941; In re Grand Jury Subpoena Dated June 5, 1985, 628 F.2d 231, 237 (Sta Cir. 1987). On the other hand, the denial of a aektin to quash a subpoena directed at the movant’s former attorney is appealable. In re Grand Jury Subpoenas Duces Tecum (Lahodny), 695 F.2d 363, 365 (9th Cir. 1982). Although In re Grand Jury Subpoena 92-1 (SJ), 31 F.3d 826 (9th Cir. 1994), concluded that the denial of a motion to quash a subpoena directed at a movant’s attorney was immediately appealable without expressly discussing whether the attorney was still representing the movant, the opinion’s citation to Grand Jury Subpoenas Dated Dec. 10, 1987, 926 F.2d 847, 852-53 (9th Cir. 1991) (order immediately appealable because attorney was no longer representing the target of the subpoenas), indicates that the attorney was no longer representing the 12a movant. See Subpoena 92-1 (SJ), 31 F.3d at 828-29. Also, an order denying a motion to quash a subpoena directed at an attorney representing the movant on a matter unrelated to the grand jury investigation is immediately appealable. In re Subpoena to Testify Before the Grand Jury (Alexiou), 39 F.3d 973, 975 (9th Cir. 1994). In Niren we expressed two reasons for the limitation of the Perlman exception: (1) the exception is intended to protect only those movants who are "powerless" to control the actions of the subpoenaed third party; and (2) it is particularly inappropriate to extend the exception to third-parties who are participants in the confidential relationship upon which the avin’ Claim of privilege is based. Niren, 784 F.2d at 941 (citing National Super Spuds, Inc. v. New York Mercantile Exch., 591 F.2d 174, 179-80 n.7 (2d Cir. 13a 1979) (Friendly, J.)). These factors become decisively strong in the situation where the subpoenaed party is actively representing the movant in connection with the grand jury investigation. Subpoena Dated June 5, 1985, 825 F.2d at 237; cf. Alexiou, 39 F.3d at 975. [3] Under the above rationale, the Perlman exception does not apply here. Bailin was retained by Ord, Silva's attorney to represent Silva in a confidential, fiduciary capacity. He has remained Silva’s agent throughout these proceedings, and is therefore subject to Silva’s control to some degree. More importantly, Bailin is necessarily a party to the relationship upon which Silva’s entire claim of privilege is based. It is in precisely these circumstances that a third party can be expected to risk contempt in order to protect the 14a privileged relationship.? [4] It does no matter that Bailin is an accountant rather than an attorney. Our cases declining to extend the Perlman exception to this situation have not relied on any special fiduciary obligations of attorneys, but rather on the present, confidential nature of the movant’s agency relationship with the third party, and the fact that the relationship was related to the grand jury investigation. See Niren, 784 F.2d at 941; National Super Spuds, 591 F.2d at 179 (third party was nonattorney employee of ‘eles Subpoena Dated June 5, 1985, 825 F.2d at 237. This is consistent with a strict application of the final judgment rule in the grand jury process, designed ‘We noted in WNiren that, where a principal directs his or her agent to resist a court order to comply with a subpoena, it may be appropriate for the contempt sanctions to be directed at the principal. 784 F.2d at 941-42. 15a ORL ES OS ALR POM ES ee ee ee to prevent parties from taking frivolous appeals for the purpose of delay. Subpoena Dated June 5, 1985, 825 F.2d at 236-37. B Although the United States argues that we have no subject matter jurisdiction over Silva’s appeal, it nevertheless urges us to avoid the jurisdictional question and apply the doctrine of "hypothetical jurisdiction" in order to affirm on the merits. We decline to extend "hypothetical jurisdiction" to this case. We have applied "hypothetical jurisdiction" in certain cases. where jurisdiction is disputed to assume, without deciding, the existence of subject matter jurisdiction in order to reach the merits of an appeal. Clow v. United States Dep’t of Housing and Urban Dev., 948 F.2d 614, 616-17 n.2 (Sth Cir. 1991). 16a The doctrine has several required elements: (1) the jurisdictional question must be difficult; (2) the merits of the appeal must be insubstantial; (3) the appeal must be resolved against the party asserting jurisdiction; and (4) undertaking a resolution on the merits as opposed to dismissing for lack of jurisdiction must not affect the outcome. Id. [5] This case is not an appropriate one in which to apply this doctrine. it is sufficient to observe that the government’s own argument reveals that resolving the appeal on the merits, rather than dismissing it for lack of jurisdiction, will affect the outcome. Because, as the government argues, we have no subject matter jurisdiction over this appeal, we cannot substantively alter the Situation of the parties by deciding the appeal on the merits. 17a III (6) Silva’s eleventh-hour petition for review of the district court’s order by extraordinary writ also fails. We have rejected attempts to use the All Writs Act as a means of avoiding the final judgment rule in the cpntext of motions to quash grand jury subpoenas. Lampman v. United States Dist. Court, 418 F.2d 215, 217 (9th Cir. 1969), cert. denied, 397 U.S. 919 (1970); City of Los Angeles v. Williams, 438 F.2d 522, 522-23 ($8th cir. 1971). [7] In order to justify review by extraordinary writ, the district court’s ruling on a motion to quash a grand jury subpoena must amount to ae judicial "usurpation of power." Lampman, 418 F.2d et 217. No such usurpation is present here; it was obviously within the district court’s jurisdiction to rule on Silva’s motion to quash, and to decide whether the 18a subpoenaed materials are privileged.* 4 that category. rney in Y _* 33a pan > ; » OZ r -mAuIYes e+ y pF ee ee Pe 1) @ an © [14 a AQ 'é) fx) g bd 5 wo Q@ Q UO UY) $5 aA Mm & G wv Q Ose uv) we M4 Mm rte] + G ‘ : wv w . Ay ria} c > @ m wv i) 6) oo 4 w 4 rw v i © > ™ 4 W M4 © U My @ t “ Q4 1) ; v 4 a . md &. {) \ c c () WH iP 4 O | } rt 4 ‘ by a3 W) rie Ww) qd wv U ) e Mm : ‘ i 'e)) ‘ } \ ~ @ a a + cd , bd ; fa] a by 9) b4 @ @ () Ty) VU E @ v [1] e. W fH & rt J v (1) rc @ 04 @ iJ TT) = O O S W”) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386012_2026%3A1. Public record. Not legal advice.