Grand Jury Proceedings Relative to Perl, In re, GJP-86-2

• Citation: 838 F.2d 304
• Decision Date: 03 February 1988
• Docket Number: Nos. 86-5397,GJP-86-2,GJP-86-3,86-5398,s. 86-5397
• Parties: In re GRAND JURY PROCEEDINGS RELATIVE TO Norman PERL Occurring on or about 1980, () Norman Perl, Richard Hunegs and the law firm of DeParq, Anderson, Perl, Hunegs and Rudquist, Appellants, Aetna Casualty & Surety Company, Amicus Curiae. In re: GRAND JURY PROCEEDINGS RELATIVE TO Robert APPERT and Gerald Pyle Occurring on or about 1980, () Robert Appert and Gerald Pyle and the law firm of Appert & Pyle, Appellants, Aetna Casualty & Surety Company, Amicus Curiae.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

Page 304

838 F.2d 304

10 Fed.R.Serv.3d 107

In re GRAND JURY PROCEEDINGS RELATIVE TO Norman PERL Occurring on or about 1980, (GJP-86-2) Norman Perl, Richard Hunegs and the law firm of DeParq Anderson, Perl, Hunegs and Rudquist, Appellants Aetna Casualty & Surety Company, Amicus Curiae In re: GRAND JURY PROCEEDINGS RELATIVE TO Robert APPERT and Gerald Pyle Occurring on or about 1980, (GJP-86-3) Robert Appert and Gerald Pyle and the law firm of Appert &amp Pyle, Appellants, Aetna Casualty & Surety Company, Amicus Curiae.

Nos. 86-5397, 86-5398.

United States Court of Appeals, Eighth Circuit.

Submitted Sept. 2, 1987.

Decided Feb. 3, 1988.

Gary Haugen, Minneapolis, Minn., and John R. Schulz, St. Paul, Minn., for appellants.

Martha Neese, Maplewood, Minn., for appellees.

Before BOWMAN, Circuit Judge, ROSS, Senior Circuit Judge, and WOLLMAN, Circuit Judge.

ROSS, Senior Circuit Judge.

This appeal questions the propriety of the district court's ¹ decision to disclose to civil litigants certain specified documents that had been subpoenaed by a federal grand jury in 1980. Pursuant to Federal Rules of Criminal Procedure 6(e)(3)(C)(i), the trial court found that appellees had established a particularized need for the requested documents and that the need for these documents in the interest of justice outweighed the grand jury's continued need for secrecy. The court then ordered the release of these documents. We affirm that decision.

I.

In 1980, a federal grand jury was convened to investigate the possibility of criminal violations arising out of the relationship between Willard Browne, a former Aetna Casualty and Surety Company insurance adjuster, and two law firms which represented a number of women (appellees) asserting tort claims against A.H. Robins Company, the manufacturer of the Dalkon Shield intrauterine device. Many of these women were represented by appellants Robert Appert and Gerald Pyle of the law firm Appert & Pyle. Others were represented by appellant Norman Perl of the law firm Deparcq, Anderson, Perl, Hunegs & Rudquist (Perl law firm). During this representation, the appellant attorneys negotiated settlement agreements of the Dalkon Shield claims through A.H. Robins' liability carrier, Aetna Casualty, and its employee Willard Browne. At the time of the settlement negotiations, however, Willard Browne, who was supposed to be vigorously representing Aetna in the Dalkon Shield litigation, was alleged to be receiving monetary payments from his adversaries, appellant attorneys and their law firms.

Contemporaneous with the investigation by the federal government, A.H. Robins Co. brought a motion to disqualify the appellant attorneys from representation of the Dalkon Shield claimants. District Court Judge Donald Alsop presided over the investigation and hearings in connection with the disqualification motion. Prior to any ruling by Judge Alsop, however, appellants withdrew from representation of the Dalkon Shield claims.

Subsequently, many of the Dalkon Shield claimants initiated civil actions alleging claims of legal malpractice and breaches of fiduciary duties against the attorneys and their law firms and requested complete recovery of the attorneys' fees that had been paid. ² The former clients also sought treble damages pursuant to Minn.Stat.Ann. Secs. 481.07 and 481.071, predicated upon a theory of collusion and deceit, and punitive damages based upon their claim that the appellants had represented their IUD claims with an intentional and willful disregard of their legal rights.

Pursuant to Rule 6(e)(3)(C)(i) of the Federal Rules of Criminal Procedure ³, counsel for the women plaintiffs in the civil litigation against Appert, Pyle and Perl filed a motion requesting access to certain documents gathered in connection with the grand jury proceedings. The district court granted the motion finding that the need for disclosure of the documents was greater than the need for continued secrecy. Appert, Pyle and Perl now appeal this decision.

II.

The United States Supreme Court has "consistently * * * recognized that the proper functioning of our grand jury system depends upon the secrecy of grand jury proceedings." Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 218, 99 S.Ct. 1667, 1672, 60 L.Ed.2d 156 (1979). Federal Rules of Criminal Procedure 6(e)(2) codifies the traditional presumption that grand jury proceedings may not be disclosed. ⁴ The policy of secrecy surrounding grand jury proceedings, however, is not absolute. It is designed to protect from disclosure only the essence of what takes place in the grand jury room, in order to preserve the freedom and integrity of the deliberative process. See United States v. Proctor & Gamble Co., 356 U.S. 677, 681-82, 78 S.Ct. 983, 985-86, 2 L.Ed.2d 1077 (1958). Congress, through its enactment of Federal Rules of Criminal Procedure 6(e)(3)(C)(i), has recognized that in some situations justice may demand that discrete portions of grand jury proceedings be made available for use in subsequent judicial proceedings. Douglas Oil, supra, 441 U.S. at 219-20, 99 S.Ct. at 1672-73.

It is now firmly established that a person seeking Rule 6(e)(3)(C)(i) disclosure carries the burden of making a "strong showing of particularized need for grand jury materials." United States v. Sells Engineering, Inc., 463 U.S. 418, 443, 103 S.Ct. 3133, 3148, 77 L.Ed.2d 743 (1983). See also In re Matter of Disclosure of Testimony Before the Grand Jury, 580 F.2d 281, 286 (8th Cir.1978). A party demonstrates particularized need where:

the material they seek is needed to avoid a possible injustice in another judicial proceeding, * * * the need for disclosure is greater than the need for continued secrecy, and * * * their request is structured to cover only material so needed.

Douglas Oil, supra, 441 U.S. at 222, 99 S.Ct. at 1674.

The determination of whether to disclose grand jury materials under Rule 6(e) is committed to the "substantial discretion" of the district court which must "weigh carefully the competing interests in light of the relevant circumstances and the standards." Id. at 223, 99 S.Ct. at 1675. See also In re Matter of Disclosure of Testimony, supra, 580 F.2d at 287. The district court's decision is subject to reversal only if that discretion has been abused.

The requisite showing of particularized need varies with the circumstances of each case. The Supreme Court noted, "as the considerations justifying secrecy become less relevant, a party asserting a need for grand jury transcripts will have a lesser burden in showing justification." Douglas Oil, supra, 441 U.S. at 223, 99 S.Ct. at 1675. Courts have consistently distinguished the request for documents generated independent of the grand jury investigation from the request for grand jury minutes or witness transcripts, reasoning that "the degree of exposure of the grand jury process inherent in the revelation of subpoenaed documents is lesser than the degree of disclosure attributable to publication of witness transcripts." In re Sealed Case, 801 F.2d 1379, 1381 (D.C.Cir.1986). Unless a document reveals something about the intricate workings of the grand jury itself, the documents are not intrinsically secret just because they were examined by a grand jury. See United States v. Stanford, 589 F.2d 285, 291 (7th Cir.), cert. denied, 440 U.S. 983, 99 S.Ct. 1794, 60 L.Ed.2d 244 (1978). "Documents such as * * * business records * * * are created for purposes independent of grand jury investigations, and such records have many legitimate uses unrelated to the substance of the grand jury proceedings." In re Grand Jury Investigation, 630 F.2d 996, 1000 (3d Cir.1980), cert. denied, 449 U.S. 1081, 101 S.Ct. 865, 66 L.Ed.2d 805 (1981). While the disclosure of documents created independently of the grand jury investigation is less likely to impinge upon the policy underlying grand jury secrecy, the disclosure of these documents reveals "at the very least, the direction of the grand jury's investigation and the names of persons involved, and thus falls within Rule 6(e)(2)." In re Sealed Case, supra, 801 F.2d at 1381. Therefore, while the disclosure of independently generated documents may require a particularized need showing, "the parties seeking disclosure should not be required to demonstrate a large compelling need." In re Grand Jury Investigation, supra, 630 F.2d at 1001 (quoting U.S. Industries, Inc. v. United States District Court, 345 F.2d 18 (9th Cir.), cert. denied, 382 U.S. 814, 86 S.Ct. 32, 15 L.Ed.2d 62 (1965)).

In addition, the interests in grand jury secrecy are reduced, although not eliminated, when the grand jury has ended its investigation. "[A]fter the grand jury's functions are ended, disclosure is wholly proper where the ends of justice require it." United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 234, 60 S.Ct. 811, 849, 84 L.Ed. 1129 (1940). See also, Douglas Oil, supra, 441 U.S. at 222, 99 S.Ct. at 1674; In re Matter of Disclosure of Testimony, supra, 580 F.2d at 287.

With these factors in mind, we now apply the three-prong test for particularized need set forth in Douglas Oil to the case before us. The first of the three factors that we must examine is whether disclosure of the grand jury materials is necessary to avoid possible injustice in the civil lawsuits brought by the Dalkon Shield claimants against their former attorneys. The claimants have demonstrated that in order to succeed on these claims they must have access to certain documents in the possession of the grand jury, including Aetna Casualty files relating to former Appert, Pyle and Perl clients, payment by the appellant law firms to various travel agencies on behalf of Willard Browne, the general ledgers of the law firms and the firms' cancelled checks demonstrating payment to Willard Browne, and memoranda alleged to have been prepared by Browne on behalf of the two law firms.

The claimants argue that disclosure of these...