Saturday, July 30, 2005
The crime-fraud exception arises with some regularity in white collar crime investigations, and it is always a difficult area because the attorney-client privilege and work product protection, together with the requirements of grand jury secrecy, often mean that both sides are advancing positions based on assumptions and less-than-complete information. Many of the cases involve in camera and ex parte submissions to the court, and cryptic decisions by the judge on the question whether the exception applies. An interesting issue that arose recently in a Fifth Circuit case -- the inevitably named In re: Grand Jury Subpoena (here) -- addresses the subsequent question after a finding that the crime-fraud exception applies: Do any of the communications and attorney work product remain protected by the privilege/protection? The government often seeks particular documents or communications, so the issue may not arise in every case. But in In re: Grand Jury Subpoena, the court had to address the issue whether the attorney could be compelled to testify about all communications with the client and provide all work product (save perhaps opinion work product).
The case began as a run-of-the-mill gun possession case in which the police seized the weapon at the house the defendant shared with his girlfriend. After counsel was appointed, the girlfriend met with him and asked about the difference in penalties between a perjury charge and the gun possession offense -- you should be able to guess where this is going. The girlfriend, who had denied knowing anything about the weapon at the time of the search, then submitted an affidavit stating that it was hers and she lied because she did not want to lose custody of her child. When contacted by the prosecutor, the girlfriend changed her story back and said she and the defendant had concocted the affidavit, which was false. At this point, the prosecutor subpoenaed the defense attorney (who had since withdrawn because of the perjury and obstruction) to testify about his communications with the defendant and the girlfriend, and to turn over all documents related to the representation. The district court found that the government had established a prima facie case for the crime-fraud exception -- no great surprise there -- and ordered the defense attorney to comply with the subpoena. The defendant appealed on the ground that the subpoena was overbroad by seeking all communications and work product from the representation, without any specification of the communications that were related to the alleged crime or fraud.
Before the Fifth Circuit, the government argued that once a court finds the crime-fraud exception applies, then the protections of the attorney-client privilege and work product doctrine disappear and all parts of the relationship are open to inquiry. The court rejected that argument, stating:
We conclude that the proper reach of the crime-fraud exception when applicable does not extend to all communications made in the course of the attorney-client relationship, but rather is limited to those communications and documents in furtherance of the contemplated or ongoing criminal or fraudulent conduct . . . The orders compel Former Counsel to bring all written statements of Appellant and Witness and all notes, records, and recordings of interviews of Appellant and Witness. Moreover, because the court’s orders compel Former Counsel to appear and order that he cannot assert any attorney-client or work product privilege, no boundary exists as to the extent of his compelled testimony. The court’s application of the crime-fraud exception was overly broad because it lacked the requisite specificity to reach only communications and documents no longer protected by the attorney-client and work product privileges.
The Fifth Circuit's analysis is sensible because the attorney-client relationship can be quite extensive, and a finding that the purpose of some communications with the attorney involved a possible crime or fraud by the client cannot mean that the entire relationship is no longer subject to the protections of the privilege or work product doctrine. If the sole purpose of the client contacting the attorney is to seek assistance in a crime or fraud, then the Fifth Circuit acknowledges that such a situation may call for compelling the attorney to testify about all aspects of the relationship. But I suspect those situations are comparatively rare, at least when there is an on-going relationship between the lawyer and client, and the legal representation relates to more common business transactions, not drug deals, loan sharking, etc. (ph)