In Re January 1976 Grand Jury. Edward M. Genson, Attorney at Law, Witness-Appellant v. United States

This is an appeal from an order of the district court dated January 15, 1976, adjudging appellant, an attorney, in civil contempt and ordering him to be remanded to the custody of the Attorney General “until such time as he shall purge himself of this contempt or the discharge of the January 1976 Grand Jury, whichever comes first.” The appeal raises questions concerning the scope of the Fifth Amendment testimonial privilege and the standing of an attorney to invoke that privilege on behalf of his clients, and the scope of the attorney-client privilege. Other claimed violations of constitutional rights are asserted.

I. STATEMENT OF FACTS

On December 30, 1975, between 9:00 and 9:30 A.M., the Bellwood Savings and Loan Association of Bellwood, Illinois, was robbed of approximately $6,120.00 by a man and a woman. Investigators from the Federal Bureau of Investigation uncovered information leading to the identification of two suspects, Paul Bijeol and Sharon Kay Holloway, and a complaint and warrant were sworn and issued on December 31, 1975, naming these two suspects.

Investigation and interview disclosed that Bijeol had been in the employ of Edward Genson, attorney at law, prior to the commission of the robbery. Investigation also disclosed that Bijeol and his alleged female accomplice were in the Chicago office of Mr. Genson and one of his associates, Mr. Barry Goodman, between 10:00 A.M. and 12:00 noon on December 30, 1975, approximately one to three hours after the commission of the robbery. Further, Government investigators learned that the male suspect had transferred $200.00 in cash to Mr. Goodman at this time. It was also learned that Bijeol met with Genson at approximately 1:30 P.M. and again at approximately 5:30 P.M. on the day of the robbery.

At approximately 10:00 A.M. on December 31, 1975, Genson was notified by an agent of the FBI that any monies which he had received or would receive as fees for his legal services for the two suspects might constitute proceeds of the robbery. In response to an inquiry of an FBI agent, Gen-son stated that he received “something” from the male suspect, but he refrained from disclosing what the “something” was. In response to a subsequent inquiry whether he had in fact received any monies or any firearms from either of the two suspects at the time of or subsequent to their meetings on the day of the robbery, Genson asserted the attorney-client privilege as a *721 basis for refusing to respond to the questions.

On January 7, 1976, Genson was served with a subpoena duces tecum requesting the production of

“[a]ny and all monies paid or delivered to you or into your care, custody, and control by Paul Bijeol or Sharon K. Holloway, ... or their agents, subsequent to 9:00 A.M. on Tuesday, December 30, 1975.” 1

On January 9, 1976, Genson filed a motion to quash the subpoena. On January 15, 1976, after memoranda had been filed and arguments heard, Chief Judge Parsons denied the motion to quash and ordered Gen-son to appear before the grand jury and to comply with the subpoena. On that afternoon, Genson appeared before the grand jury and refused to comply with the subpoena or to answer a question pertaining to his receipt of monies from Bijeol.

The grounds for this refusal were the assertion of an attorney-client privilege, the Fifth Amendment privilege against self-incrimination on behalf of a client, the Fifth Amendment right to due process, the Fourth and Ninth Amendment right to privacy, the Fourth Amendment right prohibiting unlawful searches and seizures, and the Sixth Amendment right to counsel. The Government then petitioned for an order to compel testimony and to produce evidence. The witness again appeared before Chief Judge Parsons, who ordered him to proceed forthwith to the place of meeting of the Grand Jury, to answer the questions which he was asked in regard to the monies, and to produce said monies as required of him, if in his possession, without further assertion of the attorney-client privilege, the self-incrimination privilege of his client, or his client’s Sixth Amendment right to counsel.

The appellant then returned to the grand jury, where he again refused to comply with the subpoena or the order of the court. After this second refusal, the Government moved for a rule to show cause why Genson should not be held in contempt. The court held a hearing, entered a finding of contempt, and ordered Genson confined. 2 Execution of the sentence was first stayed until January 22, 1976, and a subsequent order stayed execution of the sentence pending this appeal.

The panel of this court hearing this case was in entire agreement as to the result to be reached in the case but was not in similar accord as to the reasons for reaching the result. The opinion following represents the views of Judge Pell supporting the result reached. Judges Tone and Bauer have set forth their views of the supportive reasons for the result reached in a separate concurring opinion which insofar as it is in conflict with Judge Pell’s opinion represents the majority view of the court. The somewhat unorthodox method of handling the *722 disposition has been necessitated by the need for an early disposition of the case.

II. THE FIFTH AMENDMENT TESTIMONIAL PRIVILEGE

The major issue in this appeal is whether a subpoena duces tecum requiring an attorney to produce for a grand jury investigation monies turned over to him by his clients and believed to be proceeds of a bank robbery infringes his clients’ Fifth Amendment privilege against compelled self-incrimination. Both the appellant and the Government admit that there is little case law exactly on point, possibly because the fruits of bank robberies, if recovered at all, are usually retrieved either pursuant to a valid search warrant or a search incident to a lawful arrest. Although there is judicial language in the decisions that bears upon the narrow issue in this appeal, it essentially is a question of first impression.

The Fifth Amendment privilege against self-incrimination does not merely encompass evidence which may lead to a criminal conviction, but also includes information which would furnish a “link in the chain of evidence” that could lead to prosecution as well as evidence which an individual reasonably believes could be used against him in a criminal prosecution. Maness v. Meyers, 419 U.S. 449, 461, 95 S.Ct. 584, 592, 42 L.Ed.2d 574, 584 (1975); Accord, Hoffman v. United States, 341 U.S. 479, 486, 71 S.Ct. 814, 818, 95 L.Ed. 1118, 1124 (1951). One of the important policies underlying the testimonial privilege is the protection of an individual’s “private enclave," Murphy v. Waterfront Comm’n, 378 U.S. 52, 55, 84 S.Ct. 1594, 1596, 12 L.Ed.2d 678, 681 (1964). In order to promote the basic policy objectives which it was believed the framers sought to achieve, the Supreme Court has recognized that the Fifth Amendment privilege respects a private inner sanctum which “necessarily includes an individual’s papers and effects to the extent that the privilege bars their compulsory production and authentication . . ..” (Emphasis supplied); Bel lis v. United States, 417 U.S. 85, 91, 94 S.Ct. 2179, 2184, 40 L.Ed.2d 678, 685 (1974). Accord, United States v. White, 322 U.S. 694, 698, 64 S.Ct. 1248, 1251, 88 L.Ed. 1542, 1545 (1944).

A series of recent Supreme Court decisions has established, however, that compulsion which makes a suspect or accused the source of real or physical evidence does not violate the testimonial privilege. E. g., United States v. Dionisio, 410 U.S. 1, 93 S.Ct. 764, 35 L.Ed.2d 67 (1973); United States v. Mara, 410 U.S. 19, 93 S.Ct. 774, 35 L.Ed.2d 99 (1973); Warden v. Hayden, 387 U.S. 294, 87 S.Ct. 1642, 18 L.Ed.2d 782 (1967); Schmerber v. California, 384 U.S. 757, 764, 86 S.Ct. 1826, 1832, 16 L.Ed.2d 908, 916 (1966). The Government relies upon this series of decisions to bolster its contention that Genson’s production of the monies, which it characterizes as mere physical evidence, would not be equatable with any self-incriminatory disclosures of a testimonial or communicative nature.

More precisely, the Government contends that Genson’s compliance with the subpoena duces tecum would not represent an impermissible authentication of the physical evidence. The only arguable testimonial disclosure which would accompany Genson’s production of the subpoenaed monies would be the implied admission that the currency had been transferred to him from one or both of his clients. 3 The appellant meets this argument by observing that the challenged subpoena seeks not just items, but items that were allegedly obtained from the attorney’s clients after a specified time on a specified day. Appellant thus argues that because the wording of the subpoena contains references to the “who” and the “when” of the alleged transfer of monies, it *723 necessarily involves assertive conduct which, as such, might well be interpreted to constitute an admission by Genson’s clients.

The question of whether the monies constitute mere physical evidence or represent a testimonial utterance is not one to be categorically or easily answered. At oral argument, the appellant insisted that he stood in such a special relationship to his clients that the Government could not enforce a subpoena duces tecum against him. In sum, the Government could demand from Genson only what it might legitimately demand from his clients. Appellant insists that no one could fail to agree that the Government could not enforce a subpoena duces tecum against the robbery suspects demanding production of the monies. In response, the Government again underscored its view of the monies as physical evidence by arguing, without authority, that the grand jury has the power to subpoena the unrecovered proceeds of a bank robbery directly from the suspected clients. 4

The other members of the panel in this appeal are of the opinion under the assumed facts of this case that even in the case of the suspects, compliance on their part with the subpoena would not possess sufficient aspects of testimonial character to activate the protective mantle of the Fifth Amendment. The author of the opinion is less certain as there would seem to him to be an implied assertion whereby the monies so produced would furnish a link in the chain of evidence that could lead to prosecution. Hoffman, supra, 341 U.S. at 486, 71 S.Ct. at 818, 95 L.Ed. at 1124.

We need not decide the question of testimonial dimension, however, as it does not resolve the question for decision. Here, the subpoena is not being served directly upon the suspects. The clients allegedly transferred monies to Genson, their attorney. He is the witness who has been ordered to appear before the grand jury. His implied admission that he received the monies from his clients on the very day of the bank robbery is not the direct testimony of the suspects themselves. As the Supreme Court has explained, “[t]he constitutional privilege ... is designed to prevent the use of legal process to force from the lips of the accused individual the evidence necessary to convict him or to force him to produce and authenticate any personal documents or effects that might incriminate him.” (Emphasis supplied.) White, supra, 322 U.S. at 698, 64 S.Ct. at 1251, 88 L.Ed. at 1545; Accord, Bellis, supra, 417 U.S. at 88, 94 S.Ct. at 2183, 40 L.Ed.2d at 683. Even if one assumes that monies of the clients are “effects,” although certainly they are not personal documents, and even assuming that the language of White, which has been approvingly quoted in Beilis, bears a direct relationship to the situation revealed in this appeal whereby compliance with subpoena would involve testimonial dimensions, a reversal would not be required here. In simple terms, even if there were testimonial disclosure, it is that of Genson, the attorney, not that of his clients.

It is well established that the compulsory processes of the judiciary stand available to require the presentation of evidence in court or before a grand jury. United States v. Nixon, 418 U.S. 683, 94 S.Ct. 3090, 41 L.Ed.2d 1039 (1974). Moreover, it has been recently established that a lawyer is not subject to the penalty of contempt for advising his client to refuse on Fifth Amendment grounds to produce materials demanded by a subpoena duces tecum where the lawyer believes in good faith *724 that the material may tend to incriminate his client. Maness v. Meyers, supra. In this appeal, however, the court confronts not the situation where the attorney advises his client to refuse production but rather one where the attorney himself, now the alleged possessor of the demanded item, declines to produce.

Unless the relationship of attorney and client is completely sui generis, as appellant argues, the author of this opinion finds no precedents supporting Genson’s refusal to produce what may possibly be the fruits of a violent crime. Although the author is not aware of any cases directly in point, he finds applicable decisional principles which compel the conclusion that the appellant’s refusal was not justified under the mantle of the Fifth Amendment.

In the leading case of Boyd v. United States, 116 U.S. 616, 6 S.Ct. 524, 29 L.Ed. 746 (1886), the Supreme Court observed that constitutional provisions for the security of person and property should be liberally construed. It is the clear duty of the courts to be watchful for the constitutional rights of the citizen, and against any stealthy encroachments thereon. However, the Boyd court firmly recognized that stolen goods are an entirely different matter than personal papers or documents:

“The search for and seizure of stolen or forfeited goods . . . are totally different things from a search for and seizure of a man’s private books and papers for the purpose of obtaining information therein contained, or of using them as evidence against him.” Id. at 623, 6 S.Ct. at 528, 29 L.Ed. at 748.

The quoted excerpt related to a Fourth rather than a Fifth Amendment context, but a recognition that a search for and seizure of stolen goods “differ toto coelo” from the search for and seizure of personal papers, id., represents a durable ground for undertaking an analysis of the policy dimensions of the present case. Even in the light of the Boyd admonition that broad and liberal construction of constitutional rights is the preferable approach, no basis is discernible for thinking that the Fifth Amendment testimonial privilege was intended to allow an attorney to suppress or secrete the physical fruits of an armed robbery.

The attorney-client relationship is not so close or special as to create some form of mystical identity between the two natural persons. No reason exists to obliterate the distinction between the person of the attorney and that of the client. The Fifth Amendment explicitly prohibits compelling an accused to bear witness against himself; it does not proscribe incriminating statements elicited from another. Couch v. United States, 409 U.S. 322, 328, 93 S.Ct. 611, 615, 34 L.Ed.2d 548, 554 (1973). As stated by Mr. Justice Holmes with typical succinctness, “[a] party is privileged from producing the evidence, but not from its production.” Johnson v. United States, 228 U.S. 457, 458, 33 S.Ct. 572, 572, 57 L.Ed. 919, 920 (1913). In the present case, the compulsion of the subpoena is directly exerted on Genson and not upon his clients. Unless he has standing to invoke on their behalf the Fifth Amendment privilege, the appellant has shown no just cause for failing to comply with the subpoena or the order of the court. 5

The touchstone for analysis of the question of standing must be the established rule that the Fifth Amendment privilege adheres basically to the person, not to the information or evidence that may incriminate him. See Couch, supra, 409 U.S. at 328, 93 S.Ct. at 615, 34 L.Ed.2d at 554. Counsel have directed attention to a number of cases which have examined the intricate policy dimensions of standing analysis, but none of the precedents is precisely applicable to the unique facts of the present appeal. The question of an attorney’s *725 standing to invoke the testimonial privilege on behalf of his clients should be approached on a case-by-case basis. In the author’s view, the best method of accomplishing this analytic task is to examine anew the meaning and thrust of Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652 (1906).

In Hale, the Supreme Court observed that “so strict is the rule that the privilege is a personal one that it has been held in some cases that counsel will not be allowed to make the objection.” Id. at 70, 26 S.Ct. at 377, 50 L.Ed. at 664. On the basis of still another passage in the Hale opinion, a number of lower courts have ruled that an attorney does not have standing to assert his client’s Fifth Amendment privilege. See United States v. Goldfarb, 328 F.2d 280, 283 (6th Cir. 1964), cert. denied, 377 U.S. 976, 84 S.Ct. 1883, 12 L.Ed.2d 746; Accord, Bouschor v. United States, 316 F.2d 451, 458 (8th Cir. 1963). On the other hand, a number of recent lower court decisions hold that an attorney, at least under certain circumstances, does have standing to assert his client’s Fifth Amendment privilege. 6 Clearly, the courts which have faced the standing question have reached varying results. See United States v. Fisher, 500 F.2d 683, 697 n. 10 (3d Cir. 1974) (en banc) (Hunter, J., concurring in part and dissenting in part), cert. granted, 420 U.S. 906, 95 5. Ct. 824, 42 L.Ed.2d 835 (1975), oral argument, 44 U.S.L.W. 3269. The more recent manifestation of a lack of unanimity among the circuits has emerged in cases involving tax investigations. The interpretative problem in those cases has revolved around differing reactions to the meaning and thrust of the Supreme Court decision in Couch, supra.

Apart from the recurring context of tax investigations, where an anticipated Supreme Court decision resolving the conflict between the Third Circuit and Fifth Circuit as exemplified in Kasmir and Fisher will provide more definite guidance, the basis for the purported conflict among the circuits over the standing question appears to stem from differing analyses of an attorney’s status as an agent, albeit one held to fiduciary standards, for his client. The source of the disagreement is the language of Hale:

“The right of a person under the Fifth Amendment to refuse to incriminate himself is purely a personal privilege of the witness. It was never intended to permit him to plead the fact that some third person might be incriminated by his testimony, even though he were the agent of such person.” Id. 201 U.S. at 69-70, 26 S.Ct. at 377, 50 L.Ed. at 663.

If the attorney is just like any other agent, the quoted excerpt points to a conclusion that the lawyer has no standing to assert his client’s testimonial privilege. See Goldfarb and Bouschor, supra. Those courts which have reached the opposite conclusion have thought that an effort to distinguish the person of the attorney from that of the client would, at least under some circumstances, represent a technical and niggardly construction of constitutional guarantees that vitiates their practical efficacy.

It is not necessary to set forth the broad outlines of the policy reasons which have engendered conflict among the circuits. In Kasmir, supra, and in United States v. Judson, 322 F.2d 460 (9th Cir. 1963), there are articulate expositions of the reasons why a recognition of standing may appear appropriate. As the Judson court stated, “The attorney and his client are so identical with respect to the function of the evidence and to the proceedings which call for its production that any distinction is mere sophistry.” Id. at 467. Clearly, there is a respectable line of authority for the proposition that the law has traditionally considered the client and his attorney as one in matters relating to the compulsory production of documents. As Professor Wigmore has observed,

*726 “[W]hen the client himself would be privileged from protection of the document, * * * as exempt from self-incrimination, the attorney having possession of the document is not bound to produce. Such has invariably been the ruling. On the other hand, if the client would be compellable to produce * * * then the attorney is equally compellable, if the document is in his custody, to produce under the appropriate procedure.” (Emphasis in original.) 8 Wigmore, Evidence § 2307 (McNaughton Rev.1961).

The problem with resting a decision on this extract is that subsequent cases have tended to undermine its accuracy. The emerging conflict in the circuits over the standing question demonstrates that it is now inaccurate to assert that the courts have invariably ruled that the attorney having possession of the document is not bound to produce. That is the basic issue which is presented for decision; and the Courts of Appeals, as noted, have taken divergent approaches since the Couch decision of 1973.

The writer of this opinion is not persuaded that the post -Couch cases creating a conflict among the circuits on the standing question vis-a-vis tax investigations are apposite to the present appeal. He does not read Kasmir as establishing a rule of attorney standing in any and all circumstances. As he reads that opinion, the rationale of which the Supreme Court is presently considering, it finds standing because of today’s necessity for tax-payers to depend upon the advice of attorneys:

“When the Constitution was first ratified, the citizens of this country were not yet dependent upon attorneys to decipher complex tax laws. And at that time, the specter of the more brutal forms of compulsory self-incrimination was all that required concern. Today, however, the government’s power can be used to stimulate a taxpayer’s dependence upon his attorney and the predictable transfer of his records. Once so transferred, the government argues, the materials are subject to compelled disclosure. In our judgment, the inherent power thus to compel indirectly an individual’s self-incrimination is curbed by the Fifth Amendment as effectively as the power to compel the same result directly.” 499 F.2d at 454-55.

In essence, then, the Fifth Circuit has accepted the basic rationale of Judson. Interestingly, the Ninth Circuit has apparently receded from its earlier position. The author finds in the case In re Michaelson, 511 F.2d 882 (9th Cir. 1975), cert. denied, 421 U.S. 978, 95 S.Ct. 1979, 44 L.Ed.2d 469, a questioning by the panel assigned that appeal whether Judson possesses viability after Couch. 511 F.2d at 890. Whereas the Judson court stated that the attorney and his client were so identical with respect to the function of the evidence and the proceedings which called for its production that any distinction was mere sophistry, the Michaelson panel followed Couch and baldly asserted that the Fifth Amendment privilege is personal.

Amid the confusion engendered by Couch, it is deemed preferable to return to the two quoted passages of Hale. It does not appear that the reference to the fact that some cases, never identified, had held that counsel would not be allowed to make objection does not, without more, lead to an automatic rule of no standing for attorneys to assert a client’s testimonial privilege. If that were true, the disparity of views among the lower courts would necessarily imply that some panels were flatly refusing to follow a binding Supreme Court ruling.

In this appeal, the court is concerned not with the compelled production, either by IRS summons or grand jury subpoena, of personal papers or documents but rather with the demand for monies which may have been stolen from a federally insured savings institution. The important testimonial communication in this case is that the suspects have had at a point in time subsequent to the armed robbery possession of the stolen monies. Such an evidentiary fact would appear to the author of this opinion to be an important link in the chain of *727 evidence. 7 As Judge Gibbons observed in his concurring opinion in the en bane Fisher decision:

“Three separate possible forms of communication may be involved with a subpoena duces tecum. One is the communication involved in the identification or authentication of the document. A second is the communication involved in acknowledging the fact of possession. The third is the communication involved in the contents of the document.” 500 F.2d at 693.

In that case, as in Kasmir, the truly incriminating communication arose from the contents of the document. Here, by way of contrast, the incriminating communication relates to the possession of the stolen monies.

In the judgment of the author of this opinion, it is unnecessary to reach the broader question of an attorney’s standing to assert his clients’ Fifth Amendment privilege under circumstances where tax records or work papers are demanded. This case is distinguishable on its facts, and there would appear to be no reason to anticipate that the Supreme Court resolution of the standing issue in the tax context will control this case. Adoption of a rule of no attorney standing in tax fraud or tax investigation cases might provide persuasive authority for a conclusion of no standing in this case, but adoption of the contrary rule of standing in tax cases would not be directly applicable. The recognition that an attorney need not produce stolen monies in response to a subpoena would provide a mechanism by which a member of a learned profession could become the privileged repository of the fruits of a violent crime. There is no reason for thinking that the policy of respecting the private enclave of individual citizens reaches that far.

For the separate reasons hereinbefore set out, it is the holding of this court that Genson’s reliance upon the Fifth Amendment is misplaced. Specifically, the majority of the panel is of the opinion that the money itself is non-testimonial and that its delivery was not assertive conduct. In this situation, the attorney is simply a witness to a criminal act. The fact that the attorney is also a participant in the act is irrelevant since he is not asserting his own privilege against self-incrimination. The author of this opinion rests his opinion upon the lack of standing on the part of the lawyer to assert the Fifth Amendment claim on behalf of his clients. Whatever implied testimony arises from the act of production is that of the lawyer. This remains true even if the wording of the subpoena contains implied questions regarding the “who” and the “when” of the alleged transfer.

III. THE ATTORNEY-CLIENT PRIVILEGE

Genson also based his refusal on the attorney-client privilege. Analytically, of course, this privilege is not identical with the Fifth Amendment right, even though closely-related concepts of privacy and confidentiality play an important role in determining the scope of the two privileges. Nor is there a similarity of analysis as *728 regards the issue of standing. The attorney-client privilege arose in the days of Elizabeth I from a consideration of the oath and the honor of the attorney rather than for the apprehensions of his client, and only in the middle of the nineteenth century did the privilege become substantially recognized as that of the client. Radiant Burners, Inc. v. American Gas Association, 320 F.2d 314, 318 (7th Cir. 1963).

The basis for the privilege is to afford the client a reasonable expectation of privacy and confidentiality with regard to disclosures made during the course of consultation with his attorney. The general rule is that, barring unusual circumstances, matters involving the receipt of fees from a client are not privileged. In Re Grand Jury Proceedings, 517 F.2d 666, 670-71 (5th Cir. 1975). That opinion, at n. 2, contains an extensive, albeit incomplete, collation of leading cases stating or applying the general rule. We find no basis for deviation here from the general rule.

Assuming that the alleged transfer of monies represented a retainer or a prepayment of fees, the fact of payment and the money itself would fall outside the scope of the privilege. Assuming that the monies were transferred not as a fee payment but as a bailment for the purposes of safekeeping, the appellant finds himself in a position closely analogous to the attorney in the case of In re Ryder, 263 F.Supp. 360 (E.D.Va.) aff’d, 381 F.2d 713 (4th Cir. 1967).

Before turning to an analysis of Ryder, we note Genson contends that he was under an ethical responsibility not to produce the demanded monies or to answer questions regarding them. The ethical obligation of a lawyer to guard the confidences and secrets of his client is broader than the attorney-client privilege. See A.B.A. Code of Professional Responsibility, EC 4 — 4 (