In Re: Grand Jury

Opinions of the United
2006 Decisions States Court of Appeals
for the Third Circuit

4-21-2006

In Re: Grand Jury
Precedential or Non-Precedential: Precedential

Docket No. 06-1474

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 PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

No. 06-1474

IN RE: GRAND JURY INVESTIGATION*

On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. No. 03-gj-00123-07)
District Judge: Hon. Legrome D. Davis

Argued March 9, 2006

Before: SLOVITER, AMBRO and NYGAARD, Circuit Judges

(Filed: April 21, 2006)

William H. Lamb (Argued)
Joel L. Frank
James C. Sargent, Jr.
Susan C. Mangold
Scott R. Withers
Lamb McErlane PC
West Chester, PA 19381-0565

Attorneys for Appellant

*
Cite as In Re: Grand Jury Investigation, No. 06-1474.
Patrick L. Meehan
United States Attorney
Robert A. Zauzmer
Assistant United States Attorney
Chief of Appeals
John J. Pease III (Argued)
Assistant United States Attorney
Philadelphia, PA 19106

Attorneys for Appellee

OPINION OF THE COURT

SLOVITER, Circuit Judge.

I.

This matter is before us in the context of an ongoing
grand jury investigation of suspected federal criminal activity.
To maintain the confidentiality of the investigation, we will refer
only to such facts as have been made public by the Assistant
U.S. Attorney. Indeed, this panel has not been made aware of
the facts in the underlying investigation, nor need we be in order
to decide the issues before us. Moreover, because the grand jury
is impaneled for only a limited lifetime, we must act
expeditiously and limit our analysis to the issues directly before
us without digression.

II.

In late 2003, a grand jury began investigating the
financial arrangements and business dealings of the individual
who we believe may be the Primary Target. Some of his
business dealings have apparently been carried out by an entity
we call, for want of a better designation, the Organization. The
grand jury investigation led to inquiry of Jane Doe, the
Executive Director of the Organization, who had, and has,
intimate knowledge of and access to the papers and other
material of both the Primary Target and the Organization. It
appears that Jane Doe is also a target of the grand jury
investigation. If she was not at the outset, she certainly has

2
become a target in light of the events with which we are
concerned. The Organization, through its counsel (“Attorney”),
has entered into a joint-defense agreement with Jane Doe and her
counsel in response to the investigation.

On April 27, 2004, the Government issued a grand jury
subpoena to the Organization. It requested all documents,
including email, from January 1, 1996 to the present,
concerning, inter alia: the Organization’s document retention and
destruction policy; the payment of certain expenses,
contributions, or donations to the Primary Target; and all grants,
contributions, or donations to the Primary Target. Attorney
produced a large number of documents on behalf of the
Organization in response to the subpoena. These are not at issue
here.

The Government was unsatisfied with the document
production, particularly with respect to what it perceived as the
Organization’s failure to search for and produce email stored on
the Organization’s computer hard drives. On January 18, 2005,
the Government issued a second subpoena to the Organization,
requesting essentially the same documents as in its previous
subpoena. In a letter dated January 19, 2005, the Government
notified Attorney that it wished to have FBI and IRS experts
perform a scan of the Organization’s computers to recover stored
information, including deleted email files.

On February 10, 2005, pursuant to an agreement among
the parties, an FBI computer technician went to the
Organization’s place of business and “imaged” the hard drive on
Jane Doe’s computer. The Government thus made an exact copy
of the contents of the hard drive, including deleted email files. It
uncovered numerous stored messages which could be construed
to show a conscious effort by the Organization’s staff to destroy
emails.

Concerned about the potential obstruction of justice by
Jane Doe and others at the Organization, the Government issued
a subpoena duces tecum to Attorney on March 1, 2005. It
sought to compel grand jury testimony regarding his discussions
with Jane Doe as to her compliance (or apparent non-

3
compliance) with the prior subpoenas for production of the
Organization’s email. The Government also sought production
of Attorney’s notes concerning his conversation with Jane Doe
regarding the Organization’s compliance with the two grand jury
subpoenas and the January 19, 2005, letter. On March 10, 2005,
the Government issued a separate subpoena for production of
documents to the custodian of records at Attorney’s law firm.

The Government, Attorney and Jane Doe then sought to
reach an agreement that would limit the scope of Attorney’s
testimony before the grand jury. The Government proposed that
Attorney testify on five subjects: (1) that he represents the
Organization in connection with the April 27, 2004, and January
18, 2005, subpoenas; (2) that he received the January 18, 2005,
subpoena and January 19 letter from the Government; (3) that he
informed Jane Doe by telephone on January 20, 2005, of his
receipt of the January 18 subpoena; (4) that he faxed a cover
letter to Jane Doe enclosing the cover letter and subpoena from
the Government; and (5) that he advised Jane Doe on January 20
regarding how to comply with the subpoena. Jane Doe voiced no
objection to subjects (1) - (4), but she challenged number (5),
claiming that Attorney’s advice regarding compliance with the
subpoena is privileged.

On January 4, 2006, the Government filed a motion to
enforce the subpoena and to compel Attorney’s testimony.
Attorney and Jane Doe were permitted to intervene with regard
to the motion, and they filed a motion to quash or to modify the
subpoena to the extent that it required disclosure of privileged
information.

On January 17, 2006, the District Court held a closed-
court hearing on the motions. The Government argued that the
crime-fraud exception should overcome the claim of privilege.
In support of its position, it submitted an ex parte affidavit from
an FBI agent with knowledge of the evidence gathered in the
investigation. The District Court also heard testimony from
Attorney and from Jane Doe’s Attorney (hereinafter “Doe’s
Attorney”). With the Government absent from the courtroom,
the two Attorneys testified essentially to their recollection of the
conversations with Jane Doe on January 20, 2005, after receipt

4
of the second subpoena and the Government’s cover letter.

The dispute before the District Court was limited to
whether Attorney should be compelled to reveal the substance of
his January 20, 2005, telephone conversation with Jane Doe and
to produce his handwritten notes concerning that conversation.
On February 1, 2006, the District Court granted the
Government’s motion to enforce its subpoena. The Court
concluded that although Attorney’s advice regarding the
subpoena is protected by the attorney-client privilege, and his
notes are covered by the work-product doctrine, disclosure was
appropriate in light of the crime-fraud exception. Based on its
review of the Government’s ex parte affidavit, the District Court
found sufficient evidence that Jane Doe was in the process of
committing obstruction of justice at the time of her January 20
conversation with Attorney, and used the information provided
by Attorney in furtherance of the crime.

The Government promptly scheduled Attorney’s
appearance before the grand jury. The District Court denied a
stay pending appeal. Jane Doe timely appealed, and this court
also denied a stay. On February 7, 2006, Attorney provided the
requested documents and testified before the grand jury.

III.

A. Mootness

The Government argues that this court cannot grant any
effective relief to Jane Doe because Attorney has testified and
the documents it requested have been produced. The appeal, the
Government states, is moot and should be dismissed. It relies for
support on Church of Scientology v. United States, in which the
Supreme Court stated that federal courts are not empowered “‘to
give opinions upon moot questions or abstract propositions, or to
declare principles or rules of law which cannot affect the matter
in issue in the case before [them].’” Church of Scientology v.
United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green,
159 U.S. 651, 653 (1895)). The Court explained that if an event
occurs during the pendency of an appeal which makes it
impossible for the court to render the prevailing party “any

5
effectual relief whatever,” the appeal must be dismissed as moot.
Id. (quotation marks and citation omitted).

The Court noted, however, that if there is some means by
which the court can effectuate even a partial remedy, the case
remains a live controversy. See id. at 13. Based on that
language, Jane Doe responds to the Government’s suggestion of
mootness by arguing that she is not without a remedy because
“the true harm, which is in the indictment, has not yet occurred.”
Appellant’s Br. at 20. Jane Doe recognizes that the remedy she
initially requested, i.e., the quashing of the subpoena directed to
Attorney, is no longer available, but she posits a number of
remedies that this court could grant. Therefore, she argues, this
is not a case where, in the language of Scientology, it is
impossible for us to grant her “any effectual relief whatever.”

Turning first to the documents, Jane Doe argues that this
court could direct the District Court to order the return of
Attorney’s notes of the conversation he had with Jane Doe on
January 20, documents he turned over pursuant to the grand jury
subpoenas. This was a remedy expressly recognized by the
Supreme Court in Scientology. In that case, a district court
ordered a state-court clerk to comply with an IRS civil summons
requesting the production of two tape-recorded conversations
between officials of the Church of Scientology and their
attorneys. The Church timely appealed enforcement of the
subpoena but its request for a stay was denied, and the tapes
were produced during the appeal. The Court of Appeals
concluded that the appeal was moot because the IRS had already
obtained the tapes, but the Supreme Court rejected that
conclusion. It observed that while the Court of Appeals could
not return the parties to the status quo ante, it could effectuate a
partial remedy by ordering the Government to destroy or return
any and all copies of the tapes in its possession. The Court
stated, “When the Government has obtained . . . materials as a
result of an unlawful summons, . . . a court can effectuate relief
by ordering the Government to return the records.” Id. at 13.

The notes Attorney produced to the grand jury are
tangible property, like the audio tapes. Therefore, this court can

6
fashion a meaningful remedy for the allegedly unlawful
subpoena by ordering a return of Attorney’s notes to Attorney at
his request if we decide the notes are privileged.1

Other Courts of Appeals have held that the availability of
a direction to the grand jury to return notes or documents
precludes a finding of mootness. See In re Grand Jury
Subpoenas (Stover), 40 F.3d 1096, 1100 (10th Cir. 1994)
(applying Scientology in grand jury context and holding that
refusal to quash subpoena duces tecum was not moot because
court could order return or destruction of produced documents);
see also In re Arbitration (Security Life Ins.), 228 F.3d 865, 870
(8th Cir. 2000) (dismissing as moot portion of appeal concerning
enforcement of subpoena for testimony, but hearing appeal
regarding production of documents); United States v. Florida
Azalea Specialists, 19 F.3d 620, 622 (11th Cir. 1994) (“[T]his
appeal is not moot because if we hold that the subpoena was
improperly issued, Florida Azalea would be entitled to a partial
remedy in the form of return or destruction of its documents.”).

The Government does not make any effort to distinguish
these cases, and we do not understand it to dispute Jane Doe’s
argument that the case is not moot, at least insofar as the
documents are concerned. We therefore conclude that the
availability of an order directing the grand jury to return
Attorney’s notes precludes any finding that this appeal is moot,
at least with respect to the documents.

The more difficult issue is whether the appeal is moot
with respect to Attorney’s testimony regarding the contents of
his January 20 conversation with Jane Doe. Jane Doe suggests
that an instruction could be given to the grand jury to disregard
Attorney’s testimony and that would constitute “effective relief”
which prevents the appeal from being moot. She argues that
federal courts have the power to instruct the grand jurors that

1
We believe this would provide some measure of relief to
Jane Doe, analogous to that provided in Scientology, insofar as the
grand jury would no longer have access to the information
contained therein.

7
they must disregard evidence previously presented to them. We
recognize that is the remedy frequently used by trial courts when
jurors are exposed to testimony that was not admissible. See,
e.g., United States v. De Jesus Mateo, 373 F.3d 70, 73 (1st Cir.
2004) (“Within wide margins, the prejudice caused by improper
testimony can be addressed by providing appropriate curative
instructions.”) (citation omitted). On the other hand, courts’
control over a grand jury is significantly more limited than their
control over a trial jury. In any event, we will assume arguendo
that a curative instruction would be a possible result in an
appropriate case.

The Government relies heavily upon In re Grand Jury
Proceedings (John Roe), 142 F.3d 1416 (11th Cir. 1998), where,
as here, an attorney testified in response to a subpoena prior to
resolution of the clients’ appeal and prior to issuance of an
indictment. Id. at 1420. The clients argued the appeal was not
moot because the court could either enjoin the grand jury from
considering the attorney’s testimony or it could dismiss the
grand jury. Id. at 1423. The court held that the appeal was
moot, distinguishing Scientology because the subpoena there
was for the production of tangible physical property (audio
tapes), whereas the subpoena under review sought “intangible
witness testimony.” Id. at 1422. The court noted that
Scientology did not involve grand jury proceedings, the
independence and secrecy of which limit the availability of
effective relief. Id. at 1422-23.

The Eleventh Circuit rejected the option of dismissing the
grand jury as a remedy, noting that it could not prevent the
Government from presenting the testimony to another grand
jury. Jane Doe has also suggested that we could circumvent
mootness by ordering the impaneling of a new grand jury. We
reject that course and agree with the Eleventh Circuit that
dismissal of the grand jury is not an appropriate remedy, at least
in this case. Even if this court could provide that remedy, we
find apt the Eleventh Circuit’s observation in In re Grand Jury
Proceedings (John Roe) that dismissing the grand jury would not
“erase the attorney’s testimony from the mind of the United
States Attorney and others having access to the testimony.” Id. at
1427. As such, ordering the impaneling of a new grand jury

8
would not constitute “effectual relief,” Scientology, 506 U.S. at
12, because it would do nothing to prevent the Government from
using the testimony again.2 In any event, that is much too
draconian a remedy for the situation presented here.

What Jane Doe really seeks, therefore, is an order that
prevents any future use of Attorney’s testimony. The Eleventh
Circuit rejected a future-use injunction as a remedy stating that it
would be unenforceable. In re Grand Jury Proceedings (John
Roe), 142 F.3d at 1428; see also Office of Thrift Supervision,
Dep’t of Treasury v. Dobbs, 931 F.2d 956, 959 (D.C. Cir. 1991)
(“[A] party cannot retrieve testimony once it is given; the party
can only ask that the testimony be sealed against future use. In
that event, such a challenge would be ripe only at the time when
that future use is a real, not a speculative, possibility. Because
appellant seeks only to seal his testimony against future use, we
find that his appeal became moot upon his compliance with the
district court's order enforcing the subpoena.”) (citations
omitted).

We are not convinced that we should rule out the
possibility of a future-use injunction as a remedy. Although this
court has not addressed whether a future- use injunction would
be appropriate in the grand jury context, we have held that
future- use injunctions can be entered in response to an unlawful
IRS civil summons. In Gluck v. United States, 771 F.2d 750 (3d
Cir. 1985), we held that an appeal from enforcement of a
summons was not moot even though the appellant had complied
with the summons by providing the requested documents. We
explained that “the surrendering of the documents to the IRS
does not end the controversy between the parties because, if we
find that the summonses were illegal, we can still fashion a

2
The Tenth Circuit has suggested, in dictum, that a court can
discharge a grand jury and empanel a new one “if the taint were
serious enough.” In re Grand Jury Subpoenas (Stover), 40 F.3d
1096, 1100 n. 2 (10th Cir. 1994). The court did not explain the
basis for its belief that such a remedy would be proper. Moreover,
it does not appear that any court has actually gone so far as to
discharge a grand jury in the face of an unlawful subpoena.

9
remedy–prohibition of the use of the summoned documents–to
afford [Appellants] effective relief.” Id. at 754 (emphasis
added). The Gluck decision relied upon United States v.
Friedman, 532 F.2d 928 (3d Cir. 1976), where we held that an
appeal from enforcement of a subpoena duces tecum was not
moot despite subsequent compliance. We observed that,

[i]f the taxpayers were to prevail in their contention that
all summonses were illegal because they were issued
solely to gather evidence for use in a criminal
prosecution, then the records acquired from Friedman
would have been obtained unlawfully. Such a ruling
could affect the possible use of these records in any
subsequent criminal or civil proceeding brought against
the taxpayers.

Id. at 931; see also United States v. Waltman, 525 F.2d 371, 373
n. 1 (3d Cir. 1975) (holding that surrender of a personal diary in
response to subpoena did not moot appeal because “if the diary
is not a corporate record, the individual respondent is entitled to
its return and appropriate suppression of the use of its contents”).
As the D.C. Circuit Court of Appeals has put it, “[t]he Third
Circuit’s approach implies that no subpoena case is moot so long
as the court can provide redress by sealing documents or
testimony against future use.” Office of Thrift Supervision, 931
F.2d at 959.

We do not need to decide at this time whether we should
or could issue a future- use injunction. We follow the example
of the Supreme Court in Scientology where, after holding that a
return or destruction of the audio tapes at issue provided an
effective remedy, the Court declined to address whether a future-
use injunction would also be an effective remedy. The Court
explained,

Petitioner also argues that a court can effectuate further
relief by ordering the IRS to refrain from any future use
of the information that it has derived from the tapes. Such
an order would obviously go further towards returning the
parties to the status quo ante than merely requiring the

10
 IRS to return the tapes and all copies thereof. However, as
there is no guarantee that the IRS will in fact use the
information gleaned from the tapes, it could be argued
that such an order would be an impermissible advisory
opinion. Because we are concerned only with the question
whether any relief can be ordered, we leave the “future
use” question for another day.

506 U.S. at 13 n. 6 (citations omitted).

Similarly, it is not clear that the U.S. Attorney plans to
use Attorney’s testimony as the basis for a still unissued
indictment or in any criminal proceeding. Under these
circumstances, we need not decide whether we will extend our
jurisprudence to the grand jury context. As in Scientology, the
potential availability of a future-use injunction means that the
issue is not moot. We thus reject the Government’s suggestion
that this appeal is moot.

B. Merits

We now turn to the merits of Jane Doe’s appeal. She
argues that the District Court’s order enforcing and refusing to
quash the subpoena to Attorney undermines the attorney-client
privilege because the subpoena seeks to ascertain the contents of
her conversation with Attorney on January 20, 2005. Although
Jane Doe retained a personal lawyer, her lawyer and Attorney
(who represents the Organization) entered into a joint defense
agreement, and therefore the attorney-client privilege is
applicable. In any event, the Supreme Court has held that
communication between a corporation’s counsel and the
employees of the corporation are covered by the attorney-client
privilege. Upjohn Co. v. United States, 449 U.S. 383, 397
(1981).

The Court stated that the attorney-client privilege is the
“oldest of the privileges for confidential communications
known.” Id. at 389. “[C]ourts long have viewed [the privilege’s]
central concern as one ‘to encourage full and frank
communication between attorneys and their clients and thereby
promote broader public interests in the observance of law and

11
administration of justice.’” United States v. Zolin, 491 U.S. 554,
562 (1989) (quoting Upjohn, 449 U.S. at 389).

Despite the importance of the attorney-client privilege in
the administration of justice, the Supreme Court in Zolin
commented on the costs of the privilege in that it “‘has the effect
of withholding relevant information from the factfinder.’” Id.
(quoting Fisher v. United States, 425 U.S. 391, 403 (1976)).
Therefore, the privilege can be overridden if the client used the
lawyer’s services to further a continuing or future crime or fraud.
See In Re Grand Jury Proceedings, 604 F.2d 798, 802 (3d Cir.
1979).

Jane Doe argues that the crime-fraud exception is
inapplicable in this case because she did not initiate the
communication with Attorney or solicit any advice. She relies
on the language in Doe, where this court stated, “[o]nly when a
client knowingly seeks legal counsel to further a continuing or
future crime does the crime-fraud exception apply.” United
States v. Doe, 429 F.3d 450, 454 (3d Cir. 2005).

That sentence in the Doe opinion reflects the facts in that
case, i.e., the client, a law enforcement officer, initiated the
communication with the attorney and sought his advice as to
how to circumvent the prohibition against investing in a
witness’s business. Nothing in that opinion, or in any opinion,
suggests that the crime-fraud exception applies only if the client
initiates the conversation.

To the contrary, the crime-fraud exception is equally
applicable in situations where there has been a prior attorney-
client relationship and the communication at issue was made in
the context of that relationship. There would be no reason to
limit the applicability of the crime-fraud exception to client-
initiated contact, as the exception’s purpose is to further frank
and open exchanges between the client and his or her attorney,
whether newly retained for purposes of the investigation or
otherwise.

The burden to make the necessary showing for the crime-
fraud exception falls on the party who seeks application of the

12
exception. In criminal cases, it is the Government that seeks to
invoke the crime-fraud exception to counter a defendant’s effort
to prevent disclosure of certain testimony or documents on the
ground of the attorney-client privilege. Therefore, it is the
Government that must bear the initial burden. We have
described the showing that must be made as follows:

[T]he government must make a prima facie showing that
(1) the client was committing or intending to commit a
fraud or crime, and (2) the attorney-client
communications were in furtherance of that alleged crime
or fraud. A “prima facie showing” requires presentation
of “evidence which, if believed by the fact-finder, would
be sufficient to support a finding that the elements of the
crime-fraud exception were met.”

In re Grand Jury Subpoena, 223 F.3d 213, 217 (3d Cir. 2000)
(citations omitted); see also Impounded, 241 F.3d 308, 317 (3d
Cir. 2001); Haines v. Liggett Group, Inc., 975 F.2d 81, 95-96 (3d
Cir. 1992).

In Clark v. United States, 289 U.S. 1 (1933), the Supreme
Court, in describing the evidentiary standard for the application
of the crime-fraud exception, stated:

There must be a showing of a prima facie case sufficient
to satisfy the judge that the light should be let in. . . .

. . . To drive the [attorney-client] privilege away,
there must be “something to give colour to the charge”;
there must be “prima facie evidence that it has some
foundation in fact.” When that evidence is supplied, the
seal of secrecy is broken.

Id. at 14-15 (citations and footnote omitted). The burden is not a
particularly heavy one. As the Court of Appeals for the Seventh
Circuit stated, prima facie evidence cannot mean “enough to
support a verdict in favor of the person making the claim.” In re
Feldberg, 862 F.2d 622, 624 (7th Cir. 1985).

In this case, the District Court found that at the time of

13
Jane Doe’s January 20, 2005 conversation with Attorney, Jane
Doe was committing the crime of obstruction of justice. The
Court’s finding that the Government met its burden of presenting
evidence demonstrating a reasonable basis to suspect the
perpetration of a crime, if based on adequate evidence, satisfies
the first prong of the crime-fraud exception.

The District Court based its finding on the evidence
before it, which included the ex parte affidavit provided by the
Government. The Supreme Court has made clear that the district
courts may use ex parte evidence supplied by the Government in
order to make the required findings. Zolin, 491 U.S. at 554.

In Zolin, the IRS sought to use two tape recordings
produced in an earlier case to make the required showing that the
crime-fraud exception overcame the claimed attorney-client
privilege. The Court of Appeals for the Ninth Circuit had opined
that the determination of the applicability of the crime-fraud
exception must be based on “sources independent of the
attorney-client communications recorded on the tapes.” Id. at
561. In holding that was error, the Supreme Court stated that “a
rigid independent evidence requirement does not comport with
‘reason and experience,’. . . that in camera review may be used
to determine whether allegedly privileged attorney-client
communications fall within the crime-fraud exception,” and that
the party opposing the privilege “must present evidence
sufficient to support a reasonable belief that in camera review
may yield evidence that establishes the exception’s
applicability.” Id. at 574-75.

In accordance with Zolin, the District Court here used the
affidavit of the FBI agent to support its finding that at the time of
Jane Doe’s January 20, 2005 conversation with Attorney, Jane
Doe was committing the crime of obstruction of justice by
participating in a scheme to delete emails on the computers of
the Organization, its officers, and staff. That this was the crime
on which the Government hinged its arguments with respect to
the crime-fraud exception was made clear in the Assistant U.S.
Attorney’s arguments before this court.

In conducting our review of the District Court’s finding,

14
we too must base our decision on the evidence submitted to the
District Court ex parte. We are hampered in articulating the
basis for our conclusion by the need to keep the evidentiary
support confidential because much of the relevant information
that was before the District Court is sealed as it pertains to the
ongoing investigation of the grand jury. Moreover, the parties’
briefs have been sealed. We are therefore comfortable to discuss
only such facts as the Assistant U.S. Attorney disclosed in his
argument in open court before us.

Based on our review, we agree that there was sufficient
evidence to support the District Court’s finding that Jane Doe
could be found to have engaged in the ongoing crime of
obstruction of justice.3 That does not mean we believe there is
sufficient evidence to support a jury verdict to that effect beyond
a reasonable doubt. However, there is enough evidence to meet
the first prong of the crime-fraud standard.

The second prong that the Government must satisfy, i.e.,
that the communication with the Attorney is, or was, in
furtherance of the crime, requires a more subtle analysis. In
holding that the Government had satisfied the second prong of

3
The Government apparently relies on 18 U.S.C. § 1519,
which provides as follows:

Whoever knowingly alters, destroys,
mutilates, conceals, covers up, falsifies, or
makes a false entry in any record, document,
or tangible object with the intent to impede,
obstruct, or influence the investigation or
proper administration of any matter within
the jurisdiction of any department or agency
of the United States . . . or in relation to or
contemplation of any such matter or case,
shall be fined under this title, imprisoned not
more than 20 years, or both.

There are other provisions arguably applicable and we do not
limit our analysis to Section 1519.

15
the crime-fraud exception, the District Court initially stated that
the attorney-client communication need only have been “related
to” the ongoing crime. For that proposition, it cited to a recent
Not Precedential Opinion (“NPO”) of this court, United States v.
Paz, 124 Fed. Appx. 743 (3d Cir. 2005) (per curiam), where the
opinion states for the crime-fraud exception to apply “the
Government must show that the attorney-client communications
were related to this continuing or intended criminal activity.” Id.
at 746 (citing In re Grand Jury Subpoena, 223 F.3d at 217). The
District Court erred in relying on a NPO.

Under this court’s Internal Operating Procedures
(“IOPs”), NPOs “are not regarded as precedents that bind the
court because they do not circulate to the full court before
filing.” 3d. Cir. IOP 5.7 (July 1, 2002). A fortiori, they are not
precedents for the district courts of this circuit. Although they
have always been available to the public in binders held for that
purpose in the Clerk’s Office, and hence were not “secret”
notwithstanding contrary characterization by members of the
bar, academia, and the press, they are not precedential because
they do not have the imprimatur of the full court. As our IOPs
explain, a precedential opinion of a panel of this court circulates
to all members of the court for eight days before it is filed. IOP
5.7. This gives non-panel active judges the opportunity to make
comments or to seek an en banc hearing if a judge believes that
the issue requires the consideration of and determination by the
full court. In contrast, NPOs, whether designated as per curiam
or signed by a member of the court, do not circulate because
they are written primarily to explain to the parties the basis for
the court’s determination.

The issue has arisen only recently with the publication of
such opinions on-line and in the Federal Appendix series
published by West Publishing. This court does not prohibit
citation to NPOs but the members of this court regard them for
what they are worth - the opinion of three members of the court
in a particular case.

Some NPOs would easily receive the imprimatur of the
full court because they are denominated NPOs on the premise
that they merely apply settled circuit law. Nothing in the per

16
curiam opinion in Paz suggests that the panel intended to
articulate a new standard for the crime-fraud exception. Indeed,
the page of In Re Grand Jury Subpoena cited in Paz for the
“related to” standard stated that the second prong of the crime-
fraud exception requires showing that “the attorney-client
communications were in furtherance of that alleged crime or
fraud.” In re Grand Jury Subpoena, 223 F.3d at 217 (emphasis
added). We recognize that the reference to “related to” in In Re
Grand Jury Subpoena may have misled the District Court in this
case.

This court’s precedential opinions have repeatedly set
forth the crime-fraud test as requiring that the communication
have been “in furtherance” of the crime, not only in In re Grand
Jury Subpoena, 223 F.3d at 217, but more recently in Doe, 429
F.3d at 454. See also Haines, 975 F.2d at 95. Indeed, the
Assistant U.S. Attorney so stated at the oral argument before us,
and that is the standard we apply here. Of significance, despite
the District Court’s articulation of the more relaxed “related to”
standard, in fact the District Court made the requisite finding
under the “in furtherance of the crime” standard.

When questioned by this court at the oral argument as to
how the Attorney-Jane Doe conversation furthered the crime of
obstruction of justice, the Assistant U.S. Attorney used as an
example a baseball player who seeks information about a grand
jury investigation of the illegal use of steroids. He posited a
player who

receive[d] a subpoena that directly asks for documents
related to his potential criminal use of illegal drugs. And
in the course of that he does, takes certain steps to prevent
the documents from being turned over, for example, by
destroying them.

Transcript of Oral Argument at 44. One may infer from his use
of that example that the obstruction of justice that the
Government is investigating is the deletion of potentially
relevant email files with knowledge of their relevance to the
grand jury’s investigation.

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 In this era, when communications between leaders of
business organizations are transmitted to their employees by
email rather than by phone or mail, examination of those emails
is the method most commonly used by government investigators.
That is evident to those engaged in the criminal or fraudulent
activity that is the subject of the investigation. It should
therefore come as no surprise that efforts to forestall such
investigations frequently take the form of deletion of past emails.
See, e.g., Arthur Andersen LLP v. United States, 544 U.S. 696
(2005).

In United States v. Quattrone, No. 04-5007-CR, 2006 WL
700978 (2d Cir. Mar. 20, 2006), the Government’s charge of
obstruction of justice was based in part on an email from the
defendant, Quattrone, who chaired the Company’s Tech Group,
to the bankers in that group. Quattrone was aware of the
existence of the grand jury and regulatory investigations. His
email (the “Endorsement Email”) attached an email from a
banker in the Tech Group which urged recipients not to preserve
documents under the company’s document retention policy and
stated, “Note that if a lawsuit is instituted, our normal document
retention policy is suspended and any cleaning of files is
prohibited under the [company’s] guidelines (since it constitutes
the destruction of evidence). We strongly suggest that before
you leave for the holidays, you should catch up on file cleanup.”
Id. at *5 (emphasis added). Quattrone’s Endorsement Email, the
basis for the indictment, stated, “having been a key witness in a
securities litigation case in south texas . . . I strongly advise you
to follow these procedures.” Id. at *6. The court noted that the
Tech Group had not been asked to preserve documents. The
court stated that as a “result of the Endorsement Email, at least
some Tech Group bankers began or continued ‘cleaning’ their
files.” Id.

In considering whether the evidence was sufficient to
convict Quattrone of corruptly endeavoring to obstruct a grand
jury proceeding, 18 U.S.C. §§ 1503 & 1505, the Court of
Appeals stated that “[t]here was sufficient evidence from which
a trier of fact could conclude that the government established the
nexus element of the [count at issue]. A rational trier of fact
could conclude beyond a reasonable doubt that Quattrone knew

18
that his conduct would obstruct the grand jury’s investigation
because there was a logical relationship between his knowing
conduct - sending the Endorsement Email while aware of the
grand jury subpoena’s call for documents relating to the IPO
allocation process that were in the possession of Tech Group
bankers - and the effect it was likely to have - destruction of
documents that otherwise would have been produced.” Id. at
*10. The court’s subsequent vacation of the conviction for a
jury instruction error and remand for trial does not detract from
the significance of its holding that, based on the evidence
referred to above, “the jury could infer that Quattrone was aware
that his conduct was likely to affect the grand jury
investigation.” Id.

The Government’s position in this case is that the
communication between Attorney and Jane Doe provided her
with knowledge of the type of material the Government sought,
comparable to the documents relating to the IPO allocation
process sought in Quattrone. The decision of the Court of
Appeals for the Second Circuit held that destruction of these
documents with knowledge that they were sought was sufficient
to constitute obstruction of justice. In this case, the Assistant
U.S. Attorney continued his explanation of how the Attorney-
Jane Doe conversation furthered the crime by referring again to
the hypothetical baseball player:

And in order to keep on top of where the grand
jury is going and what it’s investigating and whether the
records it may be looking for are going to be sought next
he continues to communicate with his attorney, who is in
turn the only person authorized to communicate with the
federal prosecutor who is conducting the investigation.

And as a consequence, through those
communications famous baseball player continues to be
aware of where the investigation is going and uses the
information to destroy evidence to obstruct the
investigation.

Is that relationship, are the communications that
are being used between the attorney and the prosecutor

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 and the target in furtherance of ongoing criminal activity?
I would submit that they certainly are.

Is the conduct here, are these communications the
type that this court should protect under the
attorney/client privilege? Absolutely not.

Is it this situation that we see in Doe where a client
decides, okay, I’m going to, I want to go and get involved
in some criminal scheme with some target of an
investigation, how can I go about doing this, and goes to a
lawyer. No, that’s not what we have here.

But we have an attorney/client relationship that
was used and abused by a person who was directly
involved in destroying evidence to thwart an
investigation. Those are not the type of confidential
communications that this court should protect.

Transcript of Oral Argument at 44-45 (emphasis added).

Concededly, there are no opinions of which we are aware
that apply the crime-fraud exception in precisely these
circumstances. However, we see no reason why it does not
apply. The Assistant U.S. Attorney stated, or it can be inferred
from his statements at oral argument, that in the course of the
communication between Jane Doe and Attorney, Attorney
advised Jane Doe of the contents of the most recent subpoena
and of the Government’s interest in retrieving from
Organization’s computers emails to or from certain persons,
including Jane Doe, who were or are connected with the
Organization. Apparently, the ongoing deletion of email
included information stored on the hard drive of Jane Doe’s own
computer. There is no suggestion that Attorney did anything
improper in transmitting this communication to Jane Doe and
providing legal advice on how to respond. Nor is there any
suggestion that Attorney was aware of either past wrongdoing or

20
potential future wrongdoing.4

If, with knowledge of the Government’s interest in
retrieving any remaining emails, Jane Doe continued to receive
emails that were arguably responsive to the subpoena and failed
to use her position as an executive of the Organization to direct
that all email deletions stop immediately, she may be viewed as
furthering the obstruction of the grand jury’s investigation or the
obstruction of justice. Cf. United States v. Laurins, 857 F.2d
529, 541 (9th Cir. 1988) (holding that crime-fraud exception
applied where client obstructed justice by removing responsive
documents from jurisdiction and used counsel to misrepresent to
IRS that records sought were no longer available). Certainly, the
temporal proximity of the ongoing deletion of emails after
January 20 could be viewed as an additional indication that Jane
Doe intended to use the information she gathered from the
January 20 communication to further the scheme to obstruct.
See In re Sealed Case, 754 F.2d 395, 402 (D.C. Cir. 1985)
(noting that more than “mere coincidence in time” is needed to
support invocation of crime-fraud exception).5 In any event, if
Jane Doe learned of the Government’s interest in certain
documents from her conversation with Attorney on January 20,
2005 and subsequently acquiesced in the deletion or destruction

4
Of course, the crime-fraud exception applies even when an
attorney is unaware that the client is engaged in or planning a
crime. See, e.g., In re Grand Jury Proceedings, 87 F.3d 377, 382
(9th Cir. 1996) (“It is therefore irrelevant, for purposes of
determining whether the communications here were made ‘in
furtherance of’ Corporation's criminal activity, that [counsel] may
have been in the dark about the details of that activity.”); In re
Sealed Case, 754 F.2d 395, 402 (D.C. Cir. 1985) (“It is well settled
that an attorney’s ignorance of his client’s misconduct will not
shelter that client from the consequences of his own wrongdoing.”).
5
We do not suggest that passive receipt by a low-level
employee of an email that could be viewed as suggesting deletion
of stored emails necessarily suggests that the employee has
furthered the obstruction of justice. But Jane Doe was not such an
employee.

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of those documents, the second prong of the crime-fraud
exception would be satisfied.

According to the Assistant U.S. Attorney’s statements at
the oral argument, Jane Doe’s communication with Attorney on
January 20 made it clear what the Government wanted and what
was called for in response to the subpoenas. As we previously
noted, the Government does not bear a heavy burden in showing
that Jane Doe misused her communication with Attorney in
furtherance of an improper purpose. As one court has observed,

The government does not have to show that
the intended crime or fraud was
accomplished, only that the lawyer’s advice
or other services were misused. Typically
that can be shown by evidence of some
activity following the improper
consultation, on the part of either the client
or the lawyer, to advance the intended crime
or fraud.

In re Public Defender Serv., 831 A.2d 890, 910 (D.C. 2003).

We cannot lose sight of the ultimate fact that the attorney-
client privilege is designed to promote the fair administration of
justice. Thus, while we have acknowledged that the privilege
serves “to encourage clients to make full disclosure of facts to
counsel so that he may properly, competently, and ethically
carry out his representation,” In re Grand Jury Proceedings
(FMC), 604 F.2d 798, 802 (3d Cir. 1979), we have also made it
clear that “[t]he ultimate aim [of the privilege] is to promote the
proper administration of justice.” Id. (emphasis added). A
client’s criminal misuse of advice from counsel clearly serves to
frustrate this goal. Id.

The District Court here was required to, and did, closely
scrutinize the Government’s evidence, and it also received in
camera evidence proffered by Attorney and Doe’s Attorney
regarding the substance of the January 20 communication.
Although the District Court was compelled by the secrecy of the
grand jury proceeding to redact its substantive analysis from the

22
version of its Opinion that it released to the parties, an
unredacted version of its Opinion has been provided to this
court. Based on our review of the same evidentiary record and
the District Court’s thoughtful analysis, we see no abuse of
discretion in the District Court’s decision to enforce the
subpoena to Attorney.

We note also that Jane Doe does not take issue with the
scope of the District Court’s order concerning the documents
and testimony Attorney was to provide to the grand jury, and we
are satisfied that the District Court properly tailored its order to
cover only those subjects implicated by the crime-fraud
exception.

IV.

For the reasons stated, we will affirm the District Court’s
February 1, 2006, order.
___________________

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