Consumer Credit Ins. Agency, Inc. v. U.S.

• Decision Date: 13 June 1979
• Docket Number: No. 76-2583,76-2583
• Parties: CONSUMER CREDIT INSURANCE AGENCY, INC., et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 770

599 F.2d 770

CONSUMER CREDIT INSURANCE AGENCY, INC., et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

No. 76-2583.

United States Court of Appeals Sixth Circuit.

Argued Oct. 3, 1978.

Decided June 13, 1979.

Bernard A. Berkman, Berkman, Gordon, Kancelbaum & Levy, J. Michael Murray, Cleveland, Ohio, Marc P. Richman, Silver Spring, Md., for plaintiffs-appellants.

James R. Williams, U. S. Atty., Cleveland, Ohio, Kenneth A. Bravo, Pittsburgh, Pa., Kathleen A. Felton, Crim. Div., App. Section, Dept. of Justice, Washington, D. C., for defendant-appellee.

Before WEICK, ENGEL and MERRITT, Circuit Judges.

ENGEL, Circuit Judge.

Plaintiffs commenced an action in the district court pursuant to Rule 41(e), Fed.R.Crim.P., seeking return of certain corporate books, correspondence, memoranda, books of account and like corporate documents, which they alleged had been unlawfully seized pursuant to "forthwith" grand jury subpoenas Duces tecum.

On the morning of September 10, 1976, Special Agent Terry A. Lyons of the FBI went to the office building at 514 Prospect Avenue, Cleveland, Ohio, wherein plaintiffs had their offices on the fifth floor. On the ground floor he identified and introduced himself to Allan M. Wachs, who worked for the plaintiffs in the building. Lyons and Wachs had known each other as the result of a previous investigation of the affairs of the Northern Ohio Bank. Upon Lyons' representation that he wanted to discuss Wachs' business activities with him, Lyons was invited to proceed to the company's fifth floor offices for the purpose of continuing the discussion. At that time Lyons was joined by Special Agents Fetterman and Graessle.

Once access had been gained to the fifth floor, Lyons served two "forthwith" subpoenas Duces tecum upon Wachs and Thomas D. Bosse, who arrived shortly after the agents. Bosse, like Wachs, was employed by the plaintiffs and, the trial court found, was in charge of the office. At that time Bosse was also served with a warrant for the search of "(t)he top right hand drawer of a brown wooden desk used by Gennaro J. Orrico" for a firearm which was believed to have been possessed by him there in violation of 18 U.S.C. App. § 1202(a)(1) (1976). ¹ Upon service of the subpoena and of the search warrant, Bosse immediately advised the agents that he would consult with his attorney and thereupon put a call in to Robert H. Jackson, a partner in the law firm of Kohrman & Jackson Company, LPA, legal counsel for plaintiff corporations and Bosse. The government agents were then joined by Kenneth A. Bravo, Special Attorney for the Department of Justice assigned to the Strike Force, and two additional FBI agents.

After substantial discussion between Wachs, Bosse and one Stephen Kalette, an attorney with the law firm of Kohrman & Jackson who had meanwhile arrived pursuant to Bosse's call, Robert H. Jackson appeared on the scene to consult with Wachs, Bosse and Kalette and to examine the subpoenas. Bosse, with Jackson's concurrence, asked that Bravo and the FBI agents stay in order to determine whether certain records were covered by the subpoenas. Jackson then departed, leaving Kalette to render further counsel.

For the remainder of the morning and into mid-afternoon Bosse, Wachs and Kalette continued intermittently to express their desire to cooperate in satisfying the requirements of the subpoenas. None of these individuals nor anyone else, according to the district court's findings, requested or directed the agents to leave the premises. Any examination of the records by the agents was found to have been upon the express consent of Bosse and Wachs, with no objection from Kalette. Immediately prior to the removal of the documents, Jackson was contacted by telephone for advice, yet thereafter Wachs, Bosse and Kalette continued to cooperate with the agents. After the review of plaintiffs' files was completed, the documents whose return is now sought were produced and delivered to the grand jury for use in its then-pending investigations.

The plaintiffs' motion made before the district court detailed a number of charges that the subpoenas were invalid and that the government conduct under the circumstances here was so tainted that they were in all events entitled to relief. Essentially they claimed that the subpoenas were overbroad, that the search warrant was but a ruse to enable the officers to gain entrance to the building, and that in the service of the subpoenas, the FBI agents were guilty of trespass and of threats and intimidation which coerced them into consenting to the delivery of the documents and which rendered their consent invalid.

An evidentiary hearing was held before United States District Judge Robert B. Krupansky, who thereafter filed extensive factual findings, concluding that the plaintiffs' consent to the search had been voluntary and that the documents had been lawfully seized. The court made the following ruling:

(P)laintiffs' Motion for Return of Seized Property, pursuant to Rule 41(e), Fed.R.Crim.P., must be and hereby is denied. It appearing to the Court, however, that the great volume of documents subpoenaed from petitioners could understandably impede the operation of their business for a protracted period, the Court hereby ORDERS the Government to return to petitioners the originals of all documents produced pursuant to the instant subpoenas duces tecum by October 18, 1976. This Order does not preclude the Government from copying any or all such records. ²

Our review of the record convinces us that there is much in the conduct of the officers here which we cannot approve if plaintiffs' version of the facts is to be believed. Nonetheless, after personally hearing the witnesses, Judge Krupansky elected to assign greater weight and credibility to the government's witnesses than to the plaintiffs' with respect to the issue of voluntariness. In support of his finding is the fact that plaintiffs' agents consented to the examination and delivery of documents only after advice of their counsel, Jackson, and his associate, Kalette, who was present at the scene during the entire episode and who oversaw and approved the final delivery of possession to the agents. It is also noteworthy that Jackson testified to having advised Bosse that he was not required to turn over the documents sought.

We are not impressed with plaintiffs' characterization that Kalette, the attorney sent from the firm of Kohrman & Jackson, was only a "law clerk" and somehow allowed himself to be intimidated by the aggressive behavior of the government agents. He was admitted to practice; he was sent by a responsible law firm; he was accepted by the clients for that purpose, and had been introduced to the agents by Bosse and Wachs as "their attorney." He gave advice to them, and they followed that advice. Moreover, the evidence showed that Jackson, Kalette's superior, also participated significantly in the rendering of advice. In the absence of other persuasive evidence, we do not think it is appropriate to assume, because of the attorney's relative inexperience, that he was incompetent to give proper advice or that any consent based upon the advice he actually gave was involuntary under the circumstances. Judge Krupansky did not.

Appellants also rely upon a confrontation between Special Attorney Bravo and Orrico, who arrived at 2:35 p. m. and who was then served with a subpoena identical to the two previously served upon Wachs and Bosse. While Orrico's testimony stresses the coercive nature of the events in issue, Bravo's testimony places the incident in a different light:

(The conversation occurred) just at the time we were getting ready to leave and we were located in the large open area of the office in the end, close to the elevators. Mr. Orrico began talking, I don't believe at first directly to me, saying that he was not going to the Grand Jury and then he looked in the direction of Agent Lyons and myself and said, "If you want me to go you're going to have to take me in handcuffs."

I then explained to Mr. Orrico that he had been served with a subpoena, that until such time as a Court ruled to the contrary I expected that he would obey that subpoena and in the event he did not, we would have no alternative but to ask a Federal Judge in this district to rule on the question of whether or not a warrant should be issued.

It is clear from the foregoing that Orrico objected not so much to the collection of documents, at issue here, as to the subpoena insofar as it called for his personal presence. Moreover, the district court failed to find, as plaintiffs urged, that Bravo "threatened" Orrico.

Following Orrico's recalcitrance Bravo talked to Bosse, informing him of the possible adverse publicity which would attend noncompliance. In fact, apparently unknown to Bravo, plaintiffs' attorney Jackson had likewise earlier counselled Bosse that resistance could generate adverse publicity. Bosse then talked to Orrico and prevailed upon him to comply.

We cannot agree that Bravo's statements to Bosse and Orrico were coercive and overbore their will. The agent's observations were not shown to have been untrue, and they may have in fact been realistic arguments which a prudent businessman would have wished to consider in determining whether to comply. Moreover, Kalette was on the scene to provide advice, and Jackson was consulted by telephone. That compliance was obtained only after extensive consultation with counsel diminishes whatever coercive effect Bravo's statements may have had.

The plaintiffs also claim that the officers, after having executed the search warrant and having served the subpoenas, should immediately have left the premises. We might agree if the trial judge had found that they had been asked to leave. They were not, however, but rather had been invited to stay by Bosse, found by the district court to be in charge of the office, in order...