2014 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

2-12-2014

In Re: Grand Jury

Precedential or Non-Precedential: Precedential

Docket 13-1237

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Recommended Citation

"In Re: Grand Jury" (2014). 2014 Decisions. Paper 184.

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PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

______

No. 13-1237

______

IN RE: GRAND JURY SUBPOENA

______

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(E.D. Pa. No. 2-10-gj-00127-002)

District Judge: Honorable Gene E. K. Pratter

______

Argued September 25, 2013

Before: AMBRO, FISHER and HARDIMAN, Circuit Judges.

(Filed: February 12, 2014)

Ian M. Comisky (ARGUED)

Matthew D. Lee

Blank Rome

130 North 18th Street

One Logan Square

Philadelphia, PA 19103

Stephen R. LaCheen (ARGUED)

LaCheen Wittels & Greenberg

1429 Walnut Street, Suite 1301

Philadelphia, PA 19102

Counsel for Appellant, John Doe

Michelle Morgan (ARGUED)

Peter F. Schenck

Office of United States Attorney

615 Chestnut Street, Suite 1250

Philadelphia, PA 19106

Counsel for Appellee, United States
2

______

OPINION OF THE COURT

______

FISHER, Circuit Judge.

Corporation and Client (together, “Intervenors”) are targets of an ongoing grand 

jury investigation into alleged violations of the Foreign Corrupt Practices Act (“FCPA”). 

The grand jury served a subpoena on Intervenors‟ former attorney (“Attorney”) and the 

Government moved to enforce this subpoena and compel Attorney‟s testimony, based 

upon the crime-fraud exception to the attorney-client privilege. Intervenors sought to 

quash the subpoena by asserting the attorney-client privilege and work product 

protection. After questioning Attorney in camera, the District Court found that the 

crime-fraud exception applied and compelled Attorney to testify before the grand jury. 

Intervenors appeal, challenging the District Court‟s decision to conduct an in 

camera examination, the procedures it fashioned for the examination, and the court‟s 

ultimate finding that the crime-fraud exception applies. We hold that the standard 

announced in United States v. Zolin, 491 U.S. 554, 572 (1989), applies to determine 

whether to conduct an in camera examination of a witness. We also find that the District 

Court did not abuse its discretion in applying this standard, in determining procedures for 

the examination, or in ultimately finding that the crime-fraud exception applies. We 

therefore affirm the District Court‟s order enforcing the grand jury subpoena.
3

I.

A.

This matter is before us in the context of an ongoing grand jury investigation. To 

maintain confidentiality, we will refer only to the facts that have been made public and 

will refer to those involved as “Corporation,” “Client,” and “Attorney” in order to 

maintain their anonymity. We also note that we and the District Court had access to 

information pertaining to the alleged criminal violations via the Government‟s Ex Parte

Affidavit, which set forth the basis for the Government‟s belief that the Intervenors 

committed FCPA violations. Intervenors were not apprised of this information. 

Additionally, we were informed by Attorney‟s account of the communications at issue, 

which were divulged to the District Court during the in camera examination. Neither the 

Government nor the Intervenors were privy to this account. As such, we are hampered in 

our ability to articulate the background information underlying our conclusions.

Intervenors are the targets of an ongoing grand jury investigation in the Eastern 

District of Pennsylvania seeking to determine whether they made corrupt payments to 

obtain business in violation of the FCPA. Corporation is a consulting firm headquartered 

in Pennsylvania and Client is Corporation‟s President and Managing Director. The grand 

jury investigation stems from Intervenors‟ business transactions with a financial 

institution (“the Bank”) headquartered in the United Kingdom and owned by a number of 

foreign countries. Between 2007 and 2009, Corporation was retained as a financial 

advisor by five companies to provide assistance in obtaining financing from the Bank for 
4

oil and gas projects. Two of the five projects were approved and financed by the Bank, 

resulting in the payment of nearly $8 million in success fees to Corporation. For all five 

projects, “Banker,” an official and banker at the Bank, was the operation leader 

responsible for overseeing the financing process. In 2008 and 2009, Corporation made 

payments totaling more than $3.5 million to Banker‟s sister. The payments occurred 

within months of the success-fee payments to Corporation. No evidence showed that 

Banker‟s sister worked on or was involved in any of the projects or meaningfully 

contributed to any of Corporation‟s other ventures.

Attorney worked out of Corporation‟s office but practiced law independently. In 

exchange for permitting Attorney to work out of the office rent-free, Client would 

periodically consult Attorney on ordinary legal matters. Attorney had several brief 

interactions with Client regarding one of the successful financing projects. In April 2008, 

Client approached Attorney to discuss issues he was having with the project. Client 

explained that he planned on paying Banker in order to ensure that the project progressed

swiftly, as Banker was threatening to slow down the approval process. Attorney did 

some preliminary research, found the FCPA, and asked Client whether the Bank was a 

government entity and whether Banker was a government official. Although Attorney 

could not ascertain given his limited research whether the planned action was legal or 

illegal, he advised Client not to make the payment. Despite this advice, Client insisted 

that his proposed payment did not violate the FCPA, and informed Attorney that he 
5

would go ahead with the payment. Attorney gave Client a copy of the FCPA. After this 

communication, Attorney and Client ended their relationship.1 

In February of 2010, the Bank began an internal investigation into the transactions 

between Intervenors and Banker‟s sister. The Overseas Anti-Corruption Unit (“the 

Unit”) in the United Kingdom was informed of the situation, and the Unit informed the 

Federal Bureau of Investigation (“FBI”). The Unit arrested Banker and Banker‟s sister in 

the United Kingdom; their prosecution is ongoing. The FBI began its investigation into 

Intervenors in February 2010. Due to the parallel prosecution of Banker and Banker‟s 

sister in the United Kingdom, Intervenors have some knowledge of the nature of the 

grand jury investigation of which they are subjects.

B.

The grand jury served Attorney with a subpoena. On June 18, 2012, the 

Government moved to enforce the subpoena, seeking an order directing Attorney to 

appear and testify before the grand jury. On September 4, 2012, Corporation and Client 

moved to intervene, and the District Court granted this request. After briefing, the 

District Court determined that it would conduct an in camera examination of Attorney 

outside the presence of Intervenors and the Government to determine the applicability of 

the crime-fraud exception to the communications between Attorney and Client. The 

 

1 We recognize that even this vague recitation of the communications between 

Attorney and Client would ordinarily be covered by the attorney-client privilege. We 

reveal this account of the communications only because we have found that the crimefraud exception applies.
6

District Court invited Intervenors and the Government to submit questions for the District 

Court to ask Attorney, which both did.

On January 8, 2013, the District Court questioned Attorney in camera, with only 

Attorney‟s own counsel present. After this examination, Intervenors requested that the 

District Court release a transcript of Attorney‟s testimony so that they could argue that 

the communications were not subject to the crime-fraud exception. On January 18, 2012, 

the District Court issued a memorandum and order granting the Government‟s motion to 

enforce the subpoena and directing Attorney to testify before the grand jury. Based upon 

its review of the Government‟s Ex Parte Affidavit and Attorney‟s in camera testimony, 

the District Court found a reasonable basis to suspect that Intervenors intended to commit 

a crime when Client consulted Attorney and could have used the information gleaned 

from the consultation in furtherance of the crime. The District Court also declined to 

release a transcript of the testimony. Intervenors timely appealed and the District Court 

granted a stay of its order compelling Attorney‟s grand jury testimony pending resolution 

of this appeal.

II.

The District Court had jurisdiction under 18 U.S.C. § 3231. Ordinarily, this Court 

has jurisdiction only over final decisions of district courts. 28 U.S.C. § 1291. When a 

district court orders a witness to testify or produce documents, the order is generally not 

immediately appealable; rather, the witness who wishes to object “must refuse 

compliance, be held in contempt, and then appeal the contempt order.” In re Grand Jury, 
7

705 F.3d 133, 143 (3d Cir. 2012) (internal quotation marks and citation omitted). 

However, under Perlman v. United States, 247 U.S. 7 (1918), a privilege holder may 

immediately appeal an adverse disclosure order when the privileged information is 

controlled by a “disinterested third party who is likely to disclose that information rather 

than be held in contempt for the sake of an immediate appeal.” In re Grand Jury, 705 

F.3d at 138. Attorney is a disinterested third party controlling allegedly privileged 

information. As such, this Court has jurisdiction to hear the appeal brought by 

Intervenors, the privilege holders.

“We exercise de novo review over the legal issues underlying the application of 

the crime-fraud exception to the attorney-client privilege.” In re Impounded, 241 F.3d 

308, 312 (3d Cir. 2001). “Once the court determines there is sufficient evidence of a 

crime or fraud to waive the attorney-client privilege, we review its judgment for abuse of 

discretion.” Id. at 318. We review procedures used by the district court for abuse of 

discretion. See In re Grand Jury Subpoena, 223 F.3d 213, 219 (3d Cir. 2000) (“We 

conclude that the District Court did not abuse its discretion in denying Appellant and/or 

his attorney access to this information to protect grand jury secrecy.”).

III.

Central to the issues in this case is the attorney-client privilege, the “oldest of the 

privileges for confidential communications known to the common law.” Upjohn Co. v. 

United States, 449 U.S. 383, 389 (1981). The “privilege protects from disclosure 

confidential communications made between attorneys and clients for the purpose of 
8

obtaining or providing legal assistance to the client.” In re Grand Jury, 705 F.3d at 151. 

Although the communications are often relevant and highly probative of the truth, they 

are protected in order “to encourage full and frank communication between attorneys and 

their clients and thereby promote broader public interests in the observance of law and 

administration of justice.” Upjohn Co., 449 U.S. at 389.

Despite their importance, the protections afforded by the privilege are not 

absolute. “[T]he reason for that protection . . . ceases to operate at a certain point, 

namely, where the desired advice refers not to prior wrongdoing, but to future 

wrongdoing.” Zolin, 491 U.S. at 562-63 (internal quotation marks, alterations, and 

citations omitted). “To circumvent [the attorney-client] privilege[] under the crime-fraud 

exception, the party seeking to overcome the privilege . . . 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.” In re Grand Jury, 705 F.3d at 151 (quoting In re Grand Jury Subpoena, 223 F.3d 

at 217) (internal quotation marks omitted). Because it is often difficult or impossible to 

prove that the exception applies without delving into the communications themselves, the 

Supreme Court has held that courts may use in camera review to establish the 

applicability of the exception. Zolin, 491 U.S. at 568-69. We explore the contours of in 

camera review and the ultimate crime-fraud finding in this appeal.
9

A.

Intervenors raise issues with: the standard that the District Court applied to 

determine whether to conduct an in camera examination, its decision to hold an 

examination in this case, and the procedures that it used in that examination.2 We hold 

that the District Court applied the proper standard and did not abuse its discretion in 

finding that the standard applied or in fashioning procedures for the examination. 

1.

In Zolin, the Supreme Court announced the inquiry that should precede an in 

camera review of documents to determine the applicability of the crime-fraud exception. 

491 U.S. at 572. The Court stated that a district court “should require a showing of a 

factual basis adequate to support a good faith belief by a reasonable person that in 

camera review of the materials may reveal evidence to establish the claim that the crimefraud exception applies.” Id. (internal quotation marks and citation omitted). In Zolin, 

the government sought to compel the production of tapes of communications and 

documents covered by the attorney-client privilege under the exception. Id. at 557. 

 

2

Intervenors also argue that the District Court‟s examination of the Attorney 

violated the separation of powers doctrine. This claim plainly misunderstands the roles 

of the grand jury in investigating independently from any branch of government and of 

the district court in ensuring that the grand jury does not infringe upon common law 

privileges. The grand jury belongs to no branch of the government, instead “serving as a 

kind of buffer or referee between the Government and the people.” In re Impounded, 241 

F.3d at 312 (quoting United States v. Williams, 504 U.S. 36, 47 (1992)) (internal 

quotation marks omitted). The District Court was fulfilling its obligation to check the 

grand jury‟s investigative power by reviewing the grand jury subpoena in order to protect 

the attorney-client privilege. See id. at 313. 
10

Intervenors assert that due to key differences between documented materials and the oral 

examination of an attorney, the latter should be subject to a more stringent standard than 

that announced for the former in Zolin. 

In determining the standard that should apply to in camera examination of a 

witness about oral communications, we first note that the Supreme Court did not exclude 

oral communications from the ambit of its holding. Id. at 574. Nevertheless, in camera

examination of a witness implicates different concerns than examination of documents or 

recordings, so we must determine whether we should adopt the Zolin standard where 

unmemorialized oral communications are at issue. 

In determining whether there ought to be a threshold showing for in camera

review, the Supreme Court articulated three concerns with the use of in camera

examinations: erosion of the privilege that is aimed at fostering disclosure between 

attorney and client, due process implications, and additional burdens on the district 

courts. Id. at 571. Intervenors present an additional concern – the malleability of witness 

recollections. We will weigh these concerns against the need to prove the applicability of 

the crime-fraud exception. 

While the “policy of protecting open and legitimate disclosure between attorneys 

and clients” is of the utmost importance, id. at 571, a district court‟s examination of a 

witness does no more to erode the protection than examination of written or recorded 

communications. Applying the same standard in both situations allows for equal 

accountability when the communications, whether at the behest of the client or not, were 
11

never chronicled. If we were to apply a heightened standard to oral communications, 

would-be criminals could use the differing standards to avoid the proper application of 

the crime-fraud exception. A client could seek to take advantage of the higher showing 

necessary to delve into oral communications by instructing the attorney not to record the 

communications in any way. We do not want to incentivize circumventing the proper 

application of the crime-fraud exception. As for the due process implications, we believe 

that a district court can properly be entrusted to consider the due process interests and 

circumstances in each case, and use its discretion to fashion a proper procedure for the in 

camera examination. With respect to the third concern, an in camera examination of a 

witness is more burdensome on the district court than examination of documents. The 

district court must fashion procedures for the examination, bring the witness into court, 

and conduct the hearing. However, the concern that the examination may be more 

burdensome does not indicate to us that such an examination should only be undertaken 

on a higher showing. This would serve to insulate some oral communications from the 

crime-fraud exception – an “intolerably high” cost. Id. at 569.

Intervenors‟ concern about the pliability of a witness‟s memory is a substantial 

one. An attorney‟s memory about the interaction with the client could be influenced by 

the mere fact that the crime-fraud exception is implicated, and the circumstances of how 

a question is asked can affect how the information is remembered and reported. There 

are also “dangers of inaccuracy and untrustworthiness” in probing into the memory of an 

attorney regarding past communications that do not occur with documented 
12

communications. Hickman v. Taylor, 329 U.S. 495, 512-13 (1947) (“Under ordinary 

conditions, forcing an attorney to repeat or write out all that witnesses have told him and 

to deliver the account to his adversary gives rise to grave dangers of inaccuracy and 

untrustworthiness.”). Despite these concerns, we are confident that district courts will be 

able to question an attorney-witness in a way that ensures that the attorney accurately 

recounts the communications with the client. The risk of inaccuracies is mitigated by the 

fact that the attorney will be under oath and face questioning from a judge rather than an 

adversary. The concern over the malleability of witness memory does not outweigh the 

importance of ensuring that abuses of the privilege are exposed. Some abuses of the 

privilege cannot be demonstrated by extrinsic evidence, so forbidding consideration of 

the communications would be “too great an impediment to the proper functioning of the 

adversary process.” Zolin, 491 U.S. at 569.

For these reasons, we hold that district courts should use the Zolin standard to 

determine whether to examine a witness in camera. Before a district court can undertake 

an in camera examination of an attorney-witness to determine the applicability of the 

crime-fraud exception, the party seeking to overcome the privilege must make a 

“showing of a factual basis adequate to support a good faith belief by a reasonable person 

that in camera review of the materials may reveal evidence to establish the claim that the

crime-fraud exception applies.” Id. at 572 (internal quotation marks and citation 

omitted). 
13

This conclusion is not inconsistent with previous decisions of this Court. See In re 

Grand Jury Investigation, 445 F.3d 266, 280 (3d Cir. 2006) (affirming the district court‟s 

finding that the crime-fraud exception applied where the district court had examined 

attorneys in camera); In re Grand Jury Subpoena, 223 F.3d at 216 (observing that use of 

in camera proceedings or ex parte affidavits is a procedure consistently endorsed to 

preserve grand jury secrecy). Nor is it inconsistent with decisions from other courts of 

appeals. See, e.g., In re John Doe, Inc., 13 F.3d 633, 637 (2d Cir. 1994) (finding that a 

district court‟s in camera examination of an attorney after the threshold Zolin showing 

was made comported with due process).

The District Court properly applied the Zolin standard and the Government‟s Ex 

Parte Affidavit sufficiently fulfilled this standard. The Ex Parte Affidavit contained 

details from the FBI investigation into the projects involving the Bank for which 

Corporation served as an advisor. The Affidavit also contained Attorney‟s statement to 

the FBI that Attorney was consulted about a financing project, although Attorney did not 

reveal the details of this communication. For these reasons, the District Court did not err 

in concluding that there was a factual basis to support a good faith belief that in camera

examination of Attorney might reveal evidence establishing the applicability of the 

crime-fraud exception and in conducting an in camera examination of Attorney.

2.

Intervenors contest the District Court‟s decision to exclude them from the in 

camera examination of Attorney and its refusal to release a transcript or summary of the 
14

examination. In considering Intervenors‟ request to attend the in camera examination, 

the District Court concluded that the balance between the need for grand jury secrecy and 

protection of the attorney-client privilege could only be met if neither Intervenors nor the 

Government were present during the examination of Attorney. The District Court denied 

Intervenors‟ request for a transcript, redacted transcript, or summary of the examination 

testimony for similar reasons. The District Court explained, “[b]ecause the grand jury 

proceeding here is ongoing and because the transcript almost certainly reflects a preview 

of [Attorney‟s] eventual grand jury testimony, . . . secrecy concerns outweigh any need 

for Intervenors to review the transcript of [Attorney‟s] in camera interview.” 

Intervenors argue that what transpired in camera is not a grand jury secret, 

because Attorney‟s recollections exist separate and apart from the grand jury 

investigation. The Government responds that Intervenors are not precluded from 

interviewing Attorney about his conversation with Client, if Attorney is willing. In this 

way, Attorney‟s recollections are not grand jury secrets. 

The Government argues, on the other hand, that the questions posed by the District 

Court, some of which were submitted by the Government, do constitute grand jury 

secrets. The Government maintains that the Intervenors should be prevented from 

uncovering what the Government wished to ask Attorney. Intervenors respond that they 

already know what the grand jury is investigating due to the parallel prosecution in the 

United Kingdom.
15

The District Court did not abuse its discretion in excluding the Intervenors from 

the interview or declining to release a transcript or summary of the testimony. The 

District Court noted that even though secrecy concerns are minimized by the parallel case 

in the United Kingdom, “there appears to be a significant amount of information before 

the grand jury that is not known to the Intervenors.” The District Court did not err in so 

concluding. Intervenors are not aware of how much the Government knows. But if they 

were privy to the in camera examination, they could preview not only Attorney‟s grand 

jury testimony, but also evidence already submitted to the grand jury, as reflected in the 

Government‟s questions, and the Government‟s eventual trial evidence and strategy. 

Even though some information regarding the investigation is public, the content of this 

interview is entitled to protection as a grand jury secret. See In re Grand Jury Subpoena, 

233 F.3d at 219 (“Given the acknowledged need for secrecy in grand jury proceedings, 

we reject Appellant‟s argument that the „unique facts and circumstances in this case,‟ 

including . . . the fact that the nature of the investigation has already been made public in 

several contexts, required the District Court to order disclosure of the government‟s ex 

parte affidavit.”). We therefore conclude that the District Court did not abuse its 

discretion in adopting these procedures for the in camera proceeding. 

B.

Intervenors challenge the District Court‟s determination that the crime-fraud 

exception applies to their communications with Attorney. In this circuit, the crime-fraud 

exception to the attorney-client privilege applies “[w]here there is a reasonable basis to 
16

suspect that the privilege holder was committing or intending to commit a crime or fraud 

and that the attorney-client communications or attorney work product were used in 

furtherance of the alleged crime or fraud . . . .” In re Grand Jury, 705 F.3d at 153.3 

We review the District Court‟s determination that there is sufficient evidence for 

the crime-fraud exception to apply for an abuse of discretion. In re Impounded, 241 F.3d 

at 318. We begin by acknowledging that this was a close case. The communication 

between Attorney and Client was brief, and consisted mainly of informing Client of the 

applicable law and advising that he not make the payment. However, we believe that the 

questions posed by Attorney to Client and the information that Client could gain from 

 

3

Intervenors argue on appeal that the District Court erred in applying this standard 

for the crime-fraud exception. They maintain that the panel in In re Grand Jury

improperly overruled prior precedent to create this standard. In In re Grand Jury 

Subpoena, we held that “to invoke the exception, the 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.” 223 F.3d at 217 (internal citations omitted). We then clarified that “[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.‟” Id. (quoting Haines v. Liggett Grp., Inc., 975 F.2d 81, 95-96 (3d Cir. 1992)). 

The In re Grand Jury panel observed that “sufficient to support” was “not 

particularly helpful,” as it “begs the quantum-of-proof question because it does not 

quantify what evidence is sufficient.” 705 F.3d at 152. The Court sought to clarify the 

standard, and examined Third Circuit precedent to conclude “that our precedent is 

properly captured by the reasonable basis standard.” Id. at 153. 

The In re Grand Jury panel followed what was “binding,” see IOP 9.1; “sufficient 

to support” was not a holding, but part of a standard that we clarified. The panel further 

clarified that for a presentation of evidence to be “sufficient,” there must be a “reasonable 

basis to suspect” that the elements of the crime-fraud exception are fulfilled. The In re 

Grand Jury Court did not improperly overrule the holding from a prior opinion; rather, it 

clarified an applicable precedent to delineate a more specific standard. Therefore, we 

adhere to the “reasonable basis to suspect” standard.
17

those questions are sufficient for us to conclude that the District Court did not abuse its 

discretion in determining that the advice was used in furtherance of a crime or fraud.

For the crime-fraud exception to apply, the client must be “committing or 

intending to commit a crime or fraud” at the time he or she consults the attorney. In re 

Grand Jury, 705 F.3d at 153. This requirement is stated in the present tense, and does 

not by its terms apply to a situation where a client consults an attorney about a possible 

course of action and later forms the intent to undertake that action. We have also 

observed that the attorney-client privilege “is not lost if the client innocently proposes an 

illegal course of conduct to explore with his counsel what he may or may not do.” United 

States v. Doe, 429 F.3d 450, 454 (3d Cir. 2005). The exception does not apply where the 

client forms the intent to engage in criminal or fraudulent activity after the consultation. 

Other courts of appeals have specifically clarified when the client must have 

developed the requisite intent. The Second Circuit explained that because the exception 

only applies where the communications “were intended in some way to facilitate or to 

conceal the criminal activity,” United States v. Jacobs, 117 F.3d 82, 88 (2d Cir. 1997) 

(quoting In re Grand Jury Subpoenas Duces Tecum, 798 F.2d 32, 34 (2d Cir. 1986)) 

(internal quotation marks omitted), it is required “to show that the wrong-doer had set 

upon a criminal course before consulting counsel.” Id. (emphasis in original). See also

In re Grand Jury Subpoenas, 144 F.3d 653, 660 (10th Cir. 1998) (“The evidence must 

show that the client was engaged in or was planning the criminal or fraudulent conduct 

when it sought the assistance of counsel . . . .”); In re Grand Jury Proceedings, 87 F.3d 
18

377, 381 (9th Cir. 1996) (“To trigger the crime-fraud exception, the government must 

establish that „the client was engaged in or planning a criminal or fraudulent scheme 

when it sought the advice of counsel to further the scheme.‟” (quoting In re Sealed Case, 

754 F.2d 395, 399 (D.C. Cir. 1985)).

A hypothetical question posed by Judge Ambro at oral argument highlights the 

importance of the timing of intent. A client consults with an attorney, intending at the 

time to go as close to the line of illegality as possible but to remain within the realm of 

legal conduct. The client tells the attorney of a possible course of conduct and asks for 

advice on the applicable law. The attorney gives advice, explaining which actions would 

be legal and which actions would be illegal. A year later, the client decides that he or she 

will cross the line from legal to illegal. Here, the crime-fraud exception would not apply, 

because the client was not committing a crime or fraud or intending to commit a crime or 

fraud at the time he or she consulted the attorney. Even if the client clearly used the 

advice obtained a year earlier in furtherance of the crime or fraud, the exception would 

not apply because the client did not have the requisite intent at the time of the 

consultation. 

In this case, the District Court did not abuse its discretion in determining that 

Client intended to commit a crime at the time he consulted with Attorney in April 2008. 

The evidence shows Client‟s intent to make a payment to Banker in order to ensure that 

the project was approved in a timely manner. We can infer Client‟s pre-existing intent to 

make the payment in part from his statement to Attorney that he was going to make the 
19

payment anyway, after Attorney advised him that he should not do so. This suggests that 

Client had already considered the advisability of making the payment, and determined 

that it was in his best interest to do so. The fact that the payment occurred in the same 

month that the Bank approved the project financing also indicates that Client planned on 

making the payment when he consulted with Attorney. Given the information available 

to the District Court, we cannot say that it abused its discretion in concluding that Client 

“set upon an illegal course before seeking [Attorney‟s] advice about the scheme‟s 

legality.” Jacobs, 117 F.3d at 89.

In delineating the connection required between the advice sought and the crime or 

fraud, we have repeatedly stated that the legal advice must be used “in furtherance” of the 

alleged crime or fraud. We have rejected a more relaxed “related to” standard, In re 

Grand Jury Investigation, 445 F.3d at 277, and explained that the legal advice must 

“„give[] direction for the commission of future fraud or crime,‟” In re Grand Jury 

Subpoena, 223 F.3d at 217 (quoting Haines, 975 F.2d at 90). Most recently, in In re 

Grand Jury, we observed, “[a]ll that is necessary is that the client misuse or intend to 

misuse the attorney‟s advice in furtherance of an improper purpose.” 705 F.3d at 157. It 

is therefore clear from prior precedent that for advice to be used “in furtherance” of a 

crime or fraud, the advice must advance, or the client must intend the advice to advance, 

the client‟s criminal or fraudulent purpose. The advice cannot merely relate to the crime 

or fraud. 
20

If the attorney merely informs the client of the criminality of a proposed action, 

the crime-fraud exception does not apply. For example, consider the situation where a 

client, intending to undertake an illegal course of action, consults a first attorney, tells the 

attorney the proposed course of action, and the attorney advises that the course of action 

is illegal. The client, dissatisfied with the first attorney‟s answer, then consults a second 

attorney. The client tells the attorney the same proposed course of action, but this 

attorney says yes, that course of action is legal. Both of these consultations would remain 

privileged, because the attorneys merely opined on the lawfulness of a particular course 

of conduct, and this advice cannot be used “in furtherance” of the crime.

The situation here is different. In addition to the advice Attorney provided to 

Client that he should not make a payment, Attorney also provided information about the 

types of conduct that violate the law. We cannot say that the District Court abused its 

discretion in determining “that there is a reasonable basis to conclude that [Attorney‟s] 

advice was used by [Intervenors] to fashion conduct in furtherance of [their] crime.” 

Specifically, Attorney‟s questions about whether or not the Bank was a governmental 

entity and whether Banker was a government official would have informed Client that the 

governmental connection was key to violating the FCPA. This would lead logically to

the idea of routing the payment through Banker‟s sister, who was not connected to the 

Bank, in order to avoid the reaches of the FCPA or detection of the violation. Of course, 

it is impossible to know what Client thought or how he processed the information gained 

from Attorney. But the District Court did not abuse its discretion in determining that 
21

Client “could easily have used [the advice] to shape the contours of conduct intended to 

escape the reaches of the law.” For these reason, we affirm the District Court‟s finding 

that the crime-fraud exception applies and its order compelling Attorney to testify before 

the grand jury.

C.

Intervenors assert that Attorney‟s testimony is protected by the work product

doctrine. The District Court did not address this issue; however, it was fully briefed 

before the District Court. “The work-product doctrine . . . protects from discovery 

materials prepared or collected by an attorney „in the course of preparation for possible 

litigation.‟” In re Grand Jury Investigation, 599 F.2d 1224, 1228 (3d Cir. 1979) (quoting 

Hickman, 329 U.S. at 505). The burden of proving the applicability of the work product 

privilege rests upon the party asserting the privilege. Haines, 975 F.2d at 94. A lawyer 

“may assert the work product privilege,” and “[t]o the extent a client‟s interest may be 

affected, he, too, may assert the work product privilege.” In re Grand Jury Proceedings, 

604 F.2d 798, 801 (3d Cir. 1979). Intervenors have attempted to assert the work product 

privilege on their own behalf and on Attorney‟s behalf, arguing that an innocent attorney 

can prevent disclosure of work product even if the client used it to further a crime or 

fraud. Attorney did not raise the work product issue before the District Court and 

Intervenors cannot assert the privilege on his behalf. Therefore, we need not address 

whether an innocent attorney may raise the privilege when there is a crime-fraud finding. 
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A crime-fraud finding overcomes the work product privilege. “Where there is a 

reasonable basis to suspect that the privilege holder was committing or intending to 

commit a crime or fraud and that the . . . attorney work product w[as] used in furtherance 

of the alleged crime or fraud, this is enough to break the privilege.” In re Grand Jury, 

705 F.3d at 153. Because, as discussed supra, we affirm the District Court‟s crime-fraud 

finding, the work product privilege does not apply. Nevertheless, even without the 

crime-fraud finding, the communications between Intervenors and Attorney do not 

qualify as protected work product because they were not made “in the course of 

preparation for possible litigation.” In re Grand Jury Investigation, 599 F.2d at 1228 

(quoting Hickman, 329 U.S. at 505). “Work product prepared in the course of business is 

not immune from discovery.” Holmes v. Pension Plan of Bethlehem Steel Corp., 213 

F.3d 124, 138 (3d Cir. 2000). Although the “legal theories, research, and fact material 

gathered” here could be considered intangible work product, In re Grand Jury 

Proceedings, 604 F.2d at 801, Attorney‟s recollections and research are not protected 

because they were not made in preparation for possible litigation. When Intervenors 

consulted Attorney in April 2008, there was no litigation on the horizon. Investigation 

into the transactions that led to the grand jury investigation began nearly two years later. 

The consultation was made in the ordinary course of a business transaction; therefore, 

Attorney‟s recollections are not protected work product.
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IV.

For the foregoing reasons, we affirm the order of the District Court enforcing the 

grand jury subpoena.