955 F.2d 229 (4th Cir. 1992), 88-5619, In re Grand Jury 87-3 Subpoena Duces Tecum

Docket Nº:88-5619, 88-5620.
Citation:955 F.2d 229
Party Name:In re GRAND JURY 87-3 SUBPOENA DUCES TECUM. UNITED STATES of America, Plaintiff-Appellee, v. MODEL MAGAZINE DISTRIBUTORS, INC.; R. Enterprises, Inc.; MFR Court Street Books, Inc., Defendants-Appellants, PHE, Inc., Amicus Curiae. (Two Cases) In re GRAND JURY 87-4 SUBPOENA DUCES TECUM.
Case Date:January 29, 1992
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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955 F.2d 229 (4th Cir. 1992)

In re GRAND JURY 87-3 SUBPOENA DUCES TECUM.

UNITED STATES of America, Plaintiff-Appellee,

v.

MODEL MAGAZINE DISTRIBUTORS, INC.; R. Enterprises, Inc.;

MFR Court Street Books, Inc.,

Defendants-Appellants, PHE, Inc., Amicus

Curiae. (Two Cases)

In re GRAND JURY 87-4 SUBPOENA DUCES TECUM.

Nos. 88-5619, 88-5620.

United States Court of Appeals, Fourth Circuit

January 29, 1992

Argued Oct. 1, 1991.

As Amended March 2, 1992.

Herald Price Fahringer, Lipsitz, Green, Fahringer, Roll, Salisbury & Cambria, New

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York City, argued, for defendant-appellant R. Enterprises; Ralph J. Schwarz, Jr., New York City, argued, for defendant-appellant MFR Court Street Books (Diarmuid White, Lipsitz, Green, Fahringer, Roll, Salisbury & Cambria, Richard S. Brown, Jr., New York City, Gerard G. Treanor, Jr., Venable, Baetjer & Howard, McLean, Va., on brief), for defendants-appellants.

Andrew Gerald McBride, Associate Deputy Atty. Gen., Crim. Div., U.S. Dept. of Justice, Washington, D.C., argued (Marian E. Wysocki, Attorney-Advisor, Office of Legal Counsel, Janis Kockritz, Sp. Atty., Crim. Div., U.S. Dept. of Justice, Washington, D.C., Henry E. Hudson, U.S. Atty., William G. Otis, Sr. Litigation Counsel, Bradford R. Clark, Sp. Asst. U.S. Atty., Alexandria, Va., on brief), for plaintiff-appellee.

Bruce J. Ennis, Jr., Ann M. Kappler, Jenner & Block, Washington, D.C., on brief, for amicus curiae.

Before ERVIN, Chief Judge, and PHILLIPS and WILKINSON, Circuit Judges.

OPINION

ERVIN, Chief Judge:

R. Enterprises, Inc. and MFR Court Street Books, Inc. appealed the district court's denial of their motion to quash grand jury subpoenas seeking various corporate records, arguing in part that the denial violated their First Amendment rights. This court reversed on other grounds, and the Supreme Court reversed our decision. In re Grand Jury 87-3 Subpoena: Subpoena Duces Tecum, 884 F.2d 772 (4th Cir.1989), rev'd sub nom. United States v. R. Enterprises, --- U.S. ----, 111 S.Ct. 722, 112 L.Ed.2d 795 (1991). The Supreme Court remanded for further proceedings, and this court ordered the parties to address the question of whether the First Amendment requires heightened scrutiny of the grand jury subpoenas in question. Because we have determined that the facts of this case do not implicate the First Amendment, we affirm.

I.

A grand jury sitting in the Eastern District of Virginia began to investigate allegations of interstate transportation of obscene material in 1986. The grand jury issued a subpoena to Model Magazine Distributors, Inc. (Model) calling for the production of over 2,000 videotapes allegedly depicting sexually explicit conduct. Model moved to quash the subpoena. The district court denied the motion and held Model in contempt; Model appealed. This court reversed the district court's denial of the motion to quash, because the subpoenas were impermissibly vague and overbroad. In re Grand Jury Subpoena: Subpoena Duces Tecum, 829 F.2d 1291 (4th Cir.1987), reh'g denied, 844 F.2d 202 (4th Cir.1988) ("Model I").

In 1988, the grand jury subpoenaed 193 videotapes from Model and various corporate records from Model and two other companies: R. Enterprises, Inc. (R. Enterprises) and MFR Court Street Books, Inc. (MFR). R. Enterprises is a New York distributor of adult material; MFR is a Brooklyn bookstore that sells adult books, magazines, and videotapes. The same individual owns Model, R. Enterprises, and MFR. While Model admittedly shipped material to customers located in the Eastern District of Virginia, R. Enterprises and MFR have repeatedly denied having any connection to that district. The corporations moved to quash the subpoenas, but the district court denied the motions, finding that the subpoenas were properly "tailored" and were "fairly standard business subpoenas." On August 12, 1988, the district court held all three corporations in contempt for failure to comply, fined each corporation $500 per day, and stayed imposition pending resolution of an appeal.

On appeal, this court affirmed in part, reversed in part, and remanded in part. In re Grand Jury 87-3 Subpoena Duces Tecum, 884 F.2d 772 (4th Cir.1989) ("Model II"), rev'd sub nom. United States v. R. Enterprises, --- U.S. ----, 111 S.Ct. 722, 112 L.Ed.2d 795 (1990). The Model II court applied the "relevancy, admissibility, and specificity" test of United States v. Nixon,

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418 U.S. 683, 700, 94 S.Ct. 3090, 3103, 41 L.Ed.2d 1039 (1974) and upheld the subpoenas for Model's business records. Id. at 776. As for R. Enterprises' and MFR's business records, the court quashed the subpoenas because the government had failed to show either relevance or admissibility. Id. at 776-77. Finally, as to the 193 videotapes, the court reversed and remanded for further proceedings. Id. at 777-79.

The Supreme Court granted the government's petition for certiorari on the question of whether a grand jury must demonstrate the relevance and admissibility of corporate business records before an otherwise valid subpoena can be enforced. 1...

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