IN RE OCTOBER 1969 GRAND JURY, 17990.

• Citation: 435 F.2d 350
• Decision Date: 04 January 1971
• Docket Number: No. 17990.,17990.
• Parties: In re OCTOBER 1969 GRAND JURY. Karl BRUSSEL, Witness-Appellant, v. UNITED STATES of America, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

435 F.2d 350 (1970)

In re OCTOBER 1969 GRAND JURY.

Karl BRUSSEL, Witness-Appellant, v. UNITED STATES of America, Appellee.

No. 17990.

United States Court of Appeals, Seventh Circuit.

November 4, 1970.

Rehearing Denied January 4, 1971.

Gerald M. Werksman, Chicago, Ill., Franklin S. Bonem, Ephraim London, London, Buttenwieser & Chalif, New York City, for appellant.

William J. Bauer, U. S. Atty., William P. Cagney, Asst. U. S. Atty., Chicago, Ill., for appellee; Thomas A. Foran, U. S. Atty., John Peter Lulinski, Michael B. Nash, Asst. U. S. Attys., Chicago, Ill., of counsel.

Before CASTLE, Senior Circuit Judge, FAIRCHILD and KERNER, Circuit Judges.

FAIRCHILD, Circuit Judge.

This is an appeal by Karl Brussel from an order in a civil contempt proceeding in aid of a grand jury, committing Brussel to custody until he makes certain responses to the grand jury or until expiration of the particular grand jury.

Brussel had appeared before the grand jury and, on the grounds of possible self-incrimination, declined to answer questions except for his name and place of residence, and declined to produce records of two corporations, Cybertype Corporation and Brussel & Brussel, Inc. He was brought before the district court. Attorney Franklin S. Bonem appeared as his counsel. With respect to Cybertype Corporation, the court directed that Brussel produce its records and answer questions as an officer of Cybertype Corporation, but need not answer as to personal matters. With respect to Brussel & Brussel, Inc., the court directed that he answer whether he was an officer or agent of the corporation, and if so that he produce its records and answer questions pertaining to it, but not personal matters.

Brussel again appeared before the grand jury and declined. He was brought before the court, with counsel, and again refused, in the presence of the court. The court committed him to custody until he complied with the directions or until the expiration of the grand jury.¹

The matter arose out of two subpoenas duces tecum commanding appearance before the grand jury and production of specified documents.

One subpoena was directed

"TO: Karl Brussel, President, or any authorized agent

"Room 801, Cybertype Corp.

"80 Fifth Avenue, New York, New York 10011"

It required production of several types of records concerning transactions with respect to three books, specified by title, and production of the articles of incorporation minutes, and stock records of Cybertype Corporation.

The other subpoena was directed

"TO: Brussel & Brussel, Inc. or any authorized agent

"80 Fifth Avenue, New York, New York 10011"

It required production of documents described identically as in the first subpoena, except that the corporate records were those of Brussel & Brussel, Inc.

The subpoenas called for appearance on September 30, 1969. Mr. Brussel appeared October 7. It seems not to be disputed that on September 24 there had been a telephone conversation between Attorney Ephraim London, with whom Mr. Bonem is associated, and Assistant United States Attorney Cagney and that the postponement had been agreed upon. Other aspects of the telephone conversation have been the subject of some argument.

The marshal's return of service on each subpoena shows that a copy was handed to Karl Brussel personally. Although the returns do not appear to have been brought to the attention of the district judge at the hearing, copies of the subpoenas were produced by Mr. Bonem, and there can be little question of the accuracy of the return. We know of no reason why the delivery to Mr. Brussel was not valid service of the subpoena directed to him. Whether such delivery accomplished service on Brussel & Brussel, Inc. depends upon his relationship to that corporation.

No testimony or documentary evidence was offered to show that Brussel was an officer of either Cybertype Corporation or Brussel & Brussel, Inc. Mr. Cagney told the district court that in the conversation concerning adjournment Mr. London had said that Mr. Brussel would appear as an officer of both corporations. Mr. Bonem objected to consideration of Mr. Cagney's statement as evidence.²

It is clear that Mr. Brussel's claim of privilege against self-incrimination did not, in itself, justify his refusal to produce the records of either corporation. With respect to the Cybertype records, the subpoena was directed to Brussel personally. The pertinent issue was whether he was an officer or other representative of the corporation of such capacity that he had custody of its records. The other subpoena was directed to a corporation. Brussel & Brussel, Inc. The corporation became obligated to produce its records if the subpoena was served upon it. The first issue was whether Brussel had a relationship to the corporation such that service on it was effected by delivery of a copy to him and the second was whether he was the representative of the corporation for the purpose of compliance with the subpoena or was responsible for its failure to comply.

"It is settled that a corporation is not protected by the constitutional privilege against self-incrimination. A corporate officer may not withhold testimony or documents on the ground that his corporation would be incriminated. Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652. Nor may the custodian of corporate books or records withhold them on the ground that he personally might be incriminated by their production. Wilson v. United States, 221 U.S. 361, 31 S.Ct. 538, 55 L.Ed. 771; Ann.Cas. 1912D 558; Essgee Co. of China v. United States, 262 U.S. 151, 43 S.Ct. 514, 67 L.Ed. 917."³

The custodian of subpoenaed corporate documents may be compelled to identify and authenticate them by oral testimony.⁴

Brussel's argument on appeal is that there was not enough evidence before the court of his relationship to the corporations nor his capacity to produce the described documents to warrant a finding that he had the duty or the ability to produce them.

"The justification for coercive imprisonment as applied to civil contempt depends upon the ability of the contemnor to comply with the court\'s order."⁵

The district court does not appear to have treated as evidence Mr. Cagney's statement that Mr. London had said Brussel would appear as an officer of both corporations. With respect to the Cybertype records, the district court seems to have drawn an inference from the text of the subpoena and Mr. Brussel's appearance pursuant to it that Brussel was president of the corporation and capable of producing its records. With respect to the Brussel & Brussel, Inc. records, the court evidently concluded that Mr. Brussel could be compelled to state whether or not he was an officer or authorized agent, and conditioned the order to produce the records upon an affirmative answer.

The subpoena relating to Cybertype was directed to Mr. Brussel; it designated him "President"; permitted appearance by an authorized agent; and called for records of the corporation. An inference that Brussel was the president or an authorized agent and that he was the custodian of the records must rest upon the fact that he appeared and upon the proposition that if he were not in fact the president and the custodian of the records he would probably not have appeared without first seeking to be excused. Perhaps the latter may be the more reasonable course of conduct, but we conclude that even if there be some value to the inference, it is not of...