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John Roe, Inc. v. United States
Citations: 142 F.3d 1416; 1998 U.S. App. LEXIS 12629Docket: No. 95-2322
Court: Court of Appeals for the Eleventh Circuit; June 12, 1998; Federal Appellate Court
John Roe, Inc. and its principal officer, John Roe, appealed the district court's decision to deny their motion to quash a grand jury subpoena directed at their former attorney, Attorney Doe. After the denial, the attorney testified before the grand jury, which raised the question of whether the appeal was moot due to the absence of a case or controversy. The appellants contended that the district court's in camera procedure violated their due process rights and maintained that effective relief was still available. However, the court found their argument unpersuasive and declared the appeal moot, leading to its dismissal and directing the lower court to dismiss the case. The attorney had appeared multiple times before the grand jury regarding a criminal investigation involving the appellants, during which he was allowed to document any questions he believed would breach attorney-client privilege and consult with the appellants outside the grand jury room. Following his third appearance, the Government sought, in camera, a court order to compel the attorney to answer questions he had previously declined, citing the crime-fraud exception to the privilege. The Government provided in camera materials to support its motion, which included the attorney's grand jury testimony, witness statements, and pertinent documents. The district court found sufficient evidence indicating that the appellants were involved in fraudulent activities and ordered the attorney to answer the grand jury's questions. After the compel order, the attorney was again subpoenaed, prompting the appellants to move to quash the subpoena, asserting that any testimony would disclose privileged communications. They requested access to the in camera documents related to the motion to compel, arguing that without them, they could not adequately contest the Government's claim regarding the crime-fraud exception. The district court allowed the appellants to intervene and reviewed their arguments in camera. The court denied the appellants' request for in camera documents and reaffirmed its earlier ruling that the crime-fraud exception made communications between the attorney and appellants discoverable. Consequently, the motion to quash was denied. The court addressed the appellants' concern that this denial deprived them of a fair opportunity to contest the crime-fraud issue, stating they could fully litigate this matter in a contempt hearing if the attorney refused to answer the grand jury's questions. Following the denial of their motion to quash, the appellants appealed and sought a stay, which was also denied. The attorney subsequently appeared before the grand jury and answered its questions, resulting in no indictment. The appellants argued that the district court’s refusal to provide the in camera documents denied them due process. However, the court indicated it must first determine if the appeal is moot, as federal jurisdiction requires an existing case or controversy. Citing precedent, it explained that if an event occurs making it impossible to grant effective relief, the appeal must be dismissed as moot. The court referenced a similar case where an appeal was dismissed as moot after an attorney testified before a grand jury. Although the Supreme Court's decision in Church of Scientology v. United States posed challenges to straightforward application of this precedent, the court concluded that the appellants' situation was distinguishable and no effective relief was available to them, ultimately rejecting their argument and reaffirming the prior ruling. The decision in In re Federal Grand Jury Proceedings 89-10 relied on previous rulings in United States v. First American Bank and Lawhon v. United States, which have been effectively overruled by the Supreme Court's ruling in Scientology. In Scientology, the Church of Scientology contested an IRS summons that required a state court clerk to provide audio tapes of communications between the Church and its attorneys, claiming attorney-client privilege. The clerk complied before the appeal was resolved, rendering the appeal moot. However, the Supreme Court reversed this, stating that the appeal was not moot because Scientology had a possessory interest in the tapes, and effective relief could be granted by ordering the return or destruction of the tapes. This established that a violation of possessory interest warrants judicial relief, even if the privacy invasion had already occurred. In contrast, the current case differs from Scientology in several critical respects: first, the summons in Scientology involved tangible property (audio tapes), whereas the current case involves intangible witness testimony, which cannot be retrieved. Second, appellants lack a possessory interest in transcripts of attorney testimony, which was central to Scientology's ruling. Lastly, Scientology did not concern a grand jury proceeding, where the independence and secrecy of the process limit the potential for effective relief. Consequently, the current court concludes that Scientology does not overrule In re Federal Grand Jury Proceedings 89-10, and its principles do not necessitate a ruling in favor of the appellants. Appellants argue that their appeal is not moot despite their attorney's testimony, asserting that effective relief could still be granted if they prevail. They propose that if the court finds the district court’s in camera procedure violated their due process rights, it could remand the case with instructions to provide them access to the in camera documents, consider further arguments on the crime-fraud exception, and either enjoin the grand jury from using the attorney's testimony or dismiss it entirely if an injunction is inadequate. However, the document states that these remedies would not provide effective relief for two main reasons: first, it questions the permissibility of enjoining the grand jury under the court's supervisory powers; second, even if permissible, such an order would be practically unenforceable due to the grand jury's historical independence from direct judicial control. The court emphasizes that the grand jury operates autonomously, with judges typically only involved in administrative functions, thereby complicating the enforcement of any injunction against it. The independence of the grand jury is affirmed, emphasizing that it can consider both competent evidence and evidence obtained in violation of constitutional rights without affecting the validity of an indictment. Supreme Court precedent holds that a grand jury indictment is valid even if based on evidence obtained in violation of the Fifth Amendment's privilege against self-incrimination. Consequently, an indictment cannot be challenged on the grounds of inadequate or unconstitutional evidence. The court finds it impermissible to issue an injunction preventing the grand jury from considering an attorney's testimony already presented, as judicial oversight is limited. Enforcing such an order would be impractical since the grand jury operates in secrecy, making it difficult for appellants to demonstrate that the grand jurors are using the testimony. Federal Rule of Criminal Procedure 6(e)(2) restricts inquiries into grand jury proceedings, prohibiting disclosure of deliberations and votes. Any attempt to enforce an injunction would require monitoring the grand jury's actions, which is not feasible due to the confidentiality protections in place. Even if a hearing could occur without breaching these protections, it would disrupt grand jury proceedings, undermining the efficiency and integrity of the criminal justice system. Appellants face significant challenges if they choose to wait for an indictment to move for dismissal on the grounds of grand jury misconduct. The district court would be unable to assess whether the grand jurors adhered to court orders, primarily due to Federal Rule of Evidence 606(b), which prohibits inquiry into jurors' deliberative processes. This rule prevents the court from determining if the grand jury improperly considered the attorney's testimony when issuing the indictment. Even attempts to evaluate compliance through the grand jury transcript would be futile, as legal precedent prohibits questioning the validity of indictments based on alleged reliance on inadequate or unconstitutional evidence. Consequently, enforcing an order against the grand jury would be ineffective. Similarly, an order dismissing the grand jury would not eliminate the attorney's testimony from the minds of those who had access to it, nor would it prevent the government from presenting this evidence to another grand jury. For effective relief, an injunction against the government would be necessary, but such an injunction would also be unenforceable. Appellants would face practical difficulties in monitoring the United States Attorney's actions, leading to speculation rather than concrete allegations. The burden would fall on the United States Attorney to demonstrate compliance, which could inadvertently expose sensitive investigatory information, undermining public interests in the criminal justice process. The Supreme Court has established that when a grand jury receives evidence claimed by a defendant to be illegally obtained or privileged, the appropriate remedy is not the dismissal of the indictment but rather a post-indictment motion in limine to suppress the evidence at trial. Given that the attorney has already testified before the grand jury, appellants have no effective relief available to prevent his testimony or to address the district court's denial of their motion to quash. Consequently, the appeal is deemed moot, leading to its dismissal and an instruction for the district court to dismiss the case upon receiving the mandate. In the context of the grand jury proceedings, the attorney's representation of the appellants had ended by the time of the first subpoena. The appellants sought to quash this subpoena on grounds that it would force the attorney to reveal privileged communications. The district court denied this motion, stating it was premature as it could not speculate on the questions the attorney might face. The court noted that the attorney-client privilege does not apply if communications were made to further a crime or fraud. The record does not clarify whether the affidavits were provided to the grand jury. The appellants also requested a stay of the order compelling the attorney to answer grand jury questions until their motion to quash was resolved. They argued that not receiving in camera documents, specifically the questions intended for the attorney, hindered their ability to counter the government's claim regarding the crime-fraud exception. However, the court found this claim disingenuous, noting that the attorney had consulted with the appellants before addressing any potentially privileged questions, indicating that the appellants were aware of the government's inquiries. The due process concerns raised by the appellants have been addressed by other circuit courts, which have upheld the validity of in camera reviews in similar contexts and found no due process violations under the circumstances presented. No Eleventh Circuit precedent addresses whether an in camera procedure, like the one used in this case, denies due process to parties in the appellants' position. The court previously evaluated such procedures in *In re Grand Jury Proceedings (Freeman)*, where targets of a grand jury investigation contested the district court's in camera review regarding their former attorney’s potential disclosure of privileged communications. They argued that the court improperly considered the Government's in camera motion without granting them access to the materials, although their due process claim was not explicitly stated. The court noted that cautious in camera proceedings can be appropriate for resolving privilege disputes, yet did not explore the due process implications of such procedures. Jurisdiction is established under 28 U.S.C. § 1291, which limits appeals to final district court decisions. Generally, orders denying motions to quash subpoenas are not final and thus not immediately appealable, except under the exception from *Perlman v. United States*, where it becomes final for the affected third party who cannot prevent disclosure. The court referenced *Bonner v. City of Prichard*, affirming that cases from the former Fifth Circuit prior to September 30, 1981, remain binding. As a result, the order denying the motion to quash is appealable for the appellants. The court also examined the "capable of repetition yet evading review" exception to mootness but did not determine if the case was moot based on the potential for relief. It assumed relief could only be available if the grand jury indicted the appellants and that any objection related to attorney-client privilege would be raised again if an indictment occurred. The court concluded that the objection would not evade review, as the appellants could move to suppress the testimony during trial. Thus, the court found no need to rule on the testimony's admissibility before an indictment, as doing so would constitute an advisory opinion. Ultimately, since the attorney had already testified and the privilege issue could be reviewed in a future trial, the appeal was deemed moot. Appellants may pursue post-indictment review regarding the government's intent to use an attorney's grand jury testimony, as the "capable of repetition yet evading review" exception to mootness does not apply here. The court cites Stein v. Reynolds Securities, Inc., establishing that decisions from Unit B of the former Fifth Circuit post-1981 are binding precedent. It contrasts this with the D.C. Circuit's ruling in Office of Thrift Supervision v. Dobbs, where an appeal was deemed moot after the appellant complied with a subpoena by testifying. The court emphasized that the appellant could not convert their testimony into a returnable record merely by requesting to seal the deposition transcript. The appellants' reliance on United States v. Florida Azalea Specialists is deemed misplaced, as the court found that an appeal of a subpoena enforcement order was not moot due to the potential for ordering the return or destruction of documents produced. The court has not determined whether similar relief applies in grand jury contexts, referencing a footnote from Scientology regarding the potential future use of information derived from tapes. The court expresses that the relief suggested by the appellants is not applicable in grand jury proceedings, citing In re Grand Jury Subpoenas, where the Tenth Circuit found that an appeal was not moot even after compliance with a subpoena, as the court could order the return or destruction of the documents produced. The Tenth Circuit suggested, in dicta, that a court could enhance its order regarding the return or destruction of internal affairs files by potentially directing the grand jury to avoid using statements from those files. Additionally, if the contamination from such files was significant, the court could consider discharging the grand jury and empaneling a new one. However, it does not assert that these remedies would be necessary or ordered at this stage. The current court, however, finds these remedies unavailable in the grand jury context and chooses not to adopt the Tenth Circuit’s suggestions. Appellants argue for the district court to grant relief without considering the applicability of the crime-fraud exception if it is determined that the district court's in camera procedure violated their due process rights. They contend that such relief is essential to uphold their rights, referencing Scientology and In re Grand Jury Subpoenas. The court, however, concludes that those cases do not support granting the relief sought. In a prior case, In re Federal Grand Jury Proceedings 89-10, the court assumed the only available relief would be post-indictment suppression of the attorney's grand jury testimony, noting that the potential for an indictment makes the issuance of such relief speculative and therefore barred by Article III. In contrast, the relief the appellants seek—either preventing the grand jury from considering the attorney's testimony or dismissing the grand jury—is not speculative since the attorney's testimony is already presented to the grand jury. Thus, considering the availability of effective relief is crucial for determining whether the appeal is moot. Furthermore, it is highlighted that a witness may refuse to answer grand jury questions if invoking the Fifth Amendment right against self-incrimination. The text also cites relevant statutes, including 18 U.S.C. § 1503 and § 1508, which make it a felony to corruptly influence a grand juror or to record grand jury proceedings unlawfully, warning that monitoring grand jury activities could lead to violations of these statutes and potential criminal contempt citations.