Grand Jury Witness, In re, s. 82-4631

• Citation: 695 F.2d 359
• Decision Date: 21 December 1982
• Docket Number: 82-4632,Nos. 82-4631,s. 82-4631
• Parties: 12 Fed. R. Evid. Serv. 326 In re GRAND JURY WITNESS. Richard J. SALAS, Appellant, v. UNITED STATES of America, Appellee. In re GRAND JURY WITNESS. Shelly WAXMAN, Appellant, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 359

695 F.2d 359

12 Fed. R. Evid. Serv. 326

In re GRAND JURY WITNESS.

Richard J. SALAS, Appellant, v. UNITED STATES of America, Appellee.

In re GRAND JURY WITNESS.

Shelly WAXMAN, Appellant, v. UNITED STATES of America, Appellee.

Nos. 82-4631, 82-4632.

United States Court of Appeals Ninth Circuit.

Submitted Nov. 19, 1982.

Decided Dec. 21, 1982.

Richard J. Salas, pro se.

Shelly Waxman, pro se.

Ralph L. Rogers, Kettering, Ohio, for Waxman.

Donald B. Ayer, U.S. Atty., Sacramento, Cal., Holly Abery-Wetstone, William A. Whitledge, James P. Springer, Glenn L. Archer, Jr., Washington, D.C., Ted Cassman, Ephraim Margolin, San Francisco, Cal., for United States.

Appeal from the United States District Court for the Eastern District of California.

Before GOODWIN, FERGUSON and CANBY, Circuit Judges.

PER CURIAM:

The government issued subpoenas duces tecum to two attorneys representing targets of a grand jury investigation. The attorneys appeal from a district court order finding them in contempt for their refusal to provide certain documents relating to their employment by the targets. We find that the subpoenas may intrude into areas protected by the attorney-client privilege and we are accordingly obliged to partially modify the judgment of contempt.

FACTS

For several months the federal grand jury in Fresno has been investigating the affairs of Paul Bell, the Belanco Religious Order, Chemical Supply Company, Jerry Mitchell, and Virginia Mitchell. The Belanco Religious Order is a tax protest organization espousing the belief, inter alia, that payment of income taxes is immoral and voluntary.

In connection with this investigation the government issued subpoenas to appellants Waxman and Salas, attorneys representing the several named grand jury targets. ¹ The subpoenas called for each to appear before the grand jury with the following documents:

1. Accounts receivable relating to Paul E. Bell, Jr., Jerry Mitchell, Virginia Mitchell, Belanco Religious Order, and Chemical Supply Company, Inc., including ledgers, for the period January 1, 1976 to December 31, 1981.

2. Time records which describe the amount of time spent by Shelly Waxman performing services for Paul E. Bell, Jr., Jerry Mitchell, Virginia Mitchell, Belanco Religious Order, and Chemical Supply Company, Inc., for the period January 1, 1976 to December 31, 1981.

3. Copies of all statements, bills, receipts and payments made by and for Paul E. Bell, Jr., Jerry Mitchell, Virginia Mitchell, Belanco Religious Order, and Chemical Supply Company, Inc., relating to attorney services for the period January 1, 1976 to December 31, 1982.

4. Retainer contracts, letters of understanding, and letters of agreement for Paul E. Bell, Jr., Jerry Mitchell, Virginia Mitchell, Belanco Religious Order, and Chemical Supply Company, relating to the creation and continuation of an attorney-client relationship for the period January 1, 1976 to December 31, 1981.

5. Complete description of the form of payment (check number, cashier's check number, denomination of cash, traveler's check number, etc.) for all payments made by Paul E. Bell, Jr., Jerry Mitchell, Virginia Mitchell, Chemical Supply Company and the Belanco Religious Order for the period January 1, 1976 through December 31, 1981.

The attorneys filed a motion to quash the subpoenas on a variety of legal grounds, including the attorney-client privilege. ² The government opposed the motion to quash and filed a written memorandum of law. The district court held a hearing on the motion. Waxman and Salas did not present any evidence relating to the reasons for which the clients sought their legal advice, nor were there any offers of proof. After hearing oral argument the district court denied the motion to quash. Waxman announced an intent to appeal from the denial of the motion to quash, but the district court astutely expressed doubt as to the appealability of the order. With the consent of all parties, the court then conducted a brief contempt hearing based on Waxman's stated intent to refuse to comply with the subpoenas. The attorneys were then held in contempt and filed notices of appeal. ³ The district court stayed its judgment of incarceration pending the outcome of these appeals. ⁴

The appeals were briefed under an expedited schedule and an amicus brief was also filed by the National Association of Criminal Defense Lawyers. Appellants suggested in their reply brief that this case be heard en banc. The suggestion is rejected as untimely. Fed.R.App.P. 35(c).

THE ATTORNEY-CLIENT PRIVILEGE

Appellants assert a blanket claim that all of the information demanded by the subpoenas is protected by the attorney-client privilege. In support of this claim they cite In re Grand Jury Proceedings (Lawson), 600 F.2d 215 (9th Cir.1979); Baird v. Koerner, 279 F.2d 623 (9th Cir.1960), and In re Grand Jury Proceedings (Jones), 517 F.2d 666 (5th Cir.1975). These cases, however, do not support such a broad conclusion. Each case recognizes the general rule that the identity of the client and the amount of the fee paid is not within the attorney-client privilege. A narrow exception is recognized only where revealing that information probably would incriminate a client on the same charges for which the client sought legal assistance. In re Grand Jury Proceedings (Lawson), 600 F.2d at 218; Appellants have not carried this burden with respect to the amounts and form of attorney fees received. There was no testimony or evidence offered by Waxman or Salas below, in camera or otherwise, to explain how disclosure of the attorney fees or methods of payment would implicate their clients in the activity for which they sought legal advice. In view of the absence of proof on this issue the district court properly denied the motion to quash the subpoenas with respect to attorney fees.

                Baird v. Koerner, 279 F.2d at 630;  In re Grand Jury Proceedings (Jones), 517 F.2d at 670-71.   See also United States v. Sherman, 627 F.2d 189, 191 (9th Cir.1980);  United States v. Hodge and Zweig, 548 F.2d 1347, 1353 (9th Cir.1977), citing 8 J. Wigmore, Evidence Sec. 2313 (McNaughton rev. 1961).  Moreover, the burden is on the party asserting the privilege to explain how he fits within the exception.   United States v. Hodge and Zweig, 548 F.2d at 1354
                

The above conclusion does not, however, end our inquiry in this particular case. The subpoenas quoted above demanded more than the amount of attorney fees and manner of payment. The government sought attorney time records describing the services performed by the attorneys, retainer agreements, contracts, letters of agreement, and related correspondence. We believe this type of demand to be an unjustified intrusion into the attorney-client relationship.

As a general proposition, the client's ultimate motive for litigation or for retention of an attorney is privileged. In re Grand Jury Proceedings (Jones), 517 F.2d 666, 674-75 (5th Cir.1975); see 8 J. Wigmore, Evidence Sec. 2313 (McNaughton Ed. 1961). Confidential communications between attorney and client made in order to obtain legal assistance are likewise privileged. Fisher v. United States, 425 U.S. 391, 403, 96 S.Ct. 1569, 1577, 48 L.Ed.2d 39 (1976), citing 8 J. Wigmore, Evidence Sec. 2292. Accordingly, correspondence between attorney and client which reveals the client's motivation for creation of the relationship or possible litigation strategy ought to be protected. Similarly, bills, ledgers, statements, time records and the like which also reveal the nature of the services provided, such as researching particular areas of law, also should fall within the privilege. ⁵ On the other hand, a simple invoice requesting payment for unspecified services rendered reveals nothing more than the amount of the fee and would not normally be privileged (unless the Baird exception is properly raised, as discussed supra.)

Application of these distinctions is not possible on the record now before us. The government's subpoena was met by blanket assertions of privilege, which are extremely disfavored, United States v. Cromer, 483 F.2d 99, 102 (9th Cir.1973), United States v. Davis, 636 F.2d 1028, 1044 n. 20 (5th Cir.1981), and by a host of other, frivolous defenses. The proper procedure for asserting the attorney-client privilege as to particular documents, or portions thereof, would have been for appellants to submit them in camera for the court's inspection, providing an explanation of how the information fits within the privilege. This way the court can issue a protective order with respect to any privileged portions before they are turned over to the grand jury.

Although Waxman made no attempt to demonstrate in any specific way that any of the particular documents sought fell within the ambit of the privilege, the issues here presented are important and relatively novel, and we will allow appellants to make the required showing on remand, as was done in United States v. Davis, 636 F.2d at 1044 n. 20. Equally appropriate is the Fifth Circuit's admonition: "Future litigants who make only blanket assertions of privilege at enforcement proceedings should not expect such grace." Id.

OTHER ARGUMENTS

Appellants raise several other issues on appeal. ⁶ They assert that the subpoenas violate the Sixth Amendment and also that the subpoenas were void because the grand jury did not vote to authorize them. No authority is cited for these...