Opinion ID: 387949
Heading Depth: 2
Heading Rank: 2

Heading: Propriety of Disclosure Under Subsection C

Text: 36 Federal Rule of Criminal Procedure 6(e)(3)(C)(i) authorizes a court to order disclosure of matters occurring before a grand jury for use preliminary to or in connection with a judicial proceeding. Initially, we note that the civil enforcement action here is a judicial proceeding. But cf. United States v. Bates, 627 F.2d 349, 351 (D.C.Cir.1980) (per curiam) (administrative proceeding before Federal Maritime Commission not a judicial proceeding). 37 A court should not order disclosure in violation of the traditional grand jury secrecy except upon a showing of particularized and compelling need. E. g., U.S. Industries v. United States District Court, 345 F.2d 18, 21 (9th Cir.), cert. denied, 382 U.S. 814, 86 S.Ct. 32, 15 L.Ed.2d 62 (1965); see Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 222-23, 99 S.Ct. 1667, 1674-1675, 60 L.Ed.2d 156 (1979), rev'g Petrol Stops Northwest v. United States, 571 F.2d 1127, 1129-31 (9th Cir. 1978); United States v. Procter & Gamble Co., 356 U.S. 677, 682-83, 78 S.Ct. 983, 986-987, 2 L.Ed.2d 1077 (1958). Although determination of whether such a need exists is left initially to the discretion of the trial judge, U.S. Industries, 345 F.2d at 21, the factors guiding that determination are well established. A court must examine not only the need of the party seeking disclosure, but also the effect such disclosure would have on the policies underlying grand jury secrecy. In United States v. Procter & Gamble Co., 356 U.S. 677, 78 S.Ct. 983, 2 L.Ed.2d 1077 (1958), the Supreme Court set out those policies: 38 (1) (t)o prevent the escape of those whose indictment may be contemplated; (2) to insure the utmost freedom to the grand jury in its deliberations, and to prevent persons subject to indictment or their friends from importuning the grand jurors; (3) to prevent subornation of perjury or tampering with the witnesses who may testify before grand jury and later appear at the trial of those indicted by it; (4) to encourage free and untrammeled disclosures by persons who have information with respect to the commission of crimes; (5) to protect innocent accused who is exonerated from disclosure of the fact that he has been under investigation, and from the expense of standing trial where there was no probability of guilt. 39 Id. at 681 n.6, 78 S.Ct. at 986 n.6 (quoting United States v. Rose, 215 F.2d 617, 628-29 (3d Cir. 1954)). 40 The district court in ordering disclosure failed to consider these principles. Near the conclusion of the hearing on the Rule 6(e) motion, the trial judge stated that rationale for its order: 41 I think where you have an attorney with the Civil Division of the Department of Justice, as long as he has made a showing that he has a legitimate interest in the disclosure and that he has a need of, so-called particularized need, then I think it should and could be turned over to him. 42 .... 43 Now, I think that the government has shown a particularized need here. They have demonstrated that the grand jury materials are rationally related to civil matters within the duty of the attorney for the government and that he requires the assistance of non-lawyers described and it may be those non-lawyers will be Defense Department people, but I don't think this court is required to, nor is it going to look beyond what the statute provides, or what the rule provides. If the Civil Division has the authority to prosecute violations of False Claim Acts and there have been indications that these may have occurred the Department of Justice Civil Division attorneys have the ability and the right to determine and assist in whether or not such violations did occur. 44 The United States, like any litigant, has a legitimate interest in obtaining disclosure of materials that may help it to vindicate its rights through civil proceedings. A legitimate interest, however, is not necessarily compelling. The need for disclosure must be balanced against the policies of secrecy articulated in Procter & Gamble. See Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 223, 99 S.Ct. 1667, 1675, 60 L.Ed.2d 156 (1979). Because the criminal proceedings have terminated, the first three of those factors are not implicated. However, the fourth factor encouragement of witness cooperation may be strongly implicated here. The final factor also militates toward preserving secrecy, since at least one target, Sells, Inc., obtained dismissal of all criminal charges against it. 45 The showing of a rational relationship between the materials and the civil proceeding may explain the Government's desire for disclosure, but it does not help determine the degree of necessity. That determination is made by evaluating the policies of secrecy in light of the character of the materials. In doing so, the district court must examine each distinguishable type of protected material and determine for each whether the need for disclosure outweighs the traditional and fundamental presumption of secrecy. Any grand jury abuse that has occurred is relevant to the district court's decision whether to disclose, and the court should consider appellants' allegations of such abuse. See Robert Hawthorne, Inc. v. Director of Internal Revenue, 406 F.Supp. 1098, 1118 (E.D.Pa. 1975 amended 1976); see also In re December 1974 Term Grand Jury Investigation, 449 F.Supp. 743, 750-51 (D.Md.1978); S.Rep. No. 95-354, 95th Cong., 1st Sess. 8 (1977), reprinted in 1977 U.S. Code Cong. & Ad. News 527, 532 (On the contrary, there is no reason why such use (of grand jury-developed evidence for civil law enforcement purposes) is improper, assuming that the grand jury was utilized for the legitimate purpose of a criminal investigation.). 46 The legislative history to the 1977 amendment of Rule 6(e) states that the judicial hearing in connection with an application for a court order by the government under subparagraph (3)(C)(i) should be ex parte so as to preserve, to the maximum extent possible, grand jury secrecy. S.Rep. No. 95-354, 95th Cong., 1st Sess. 8 (1977), reprinted in 1977 U.S. Code Cong. & Ad. News 527, 532. Much of the material to which the government seeks access consists of documents belonging to appellants. In these circumstances, the district court should hear appellants' views on disclosure of these documents, since such a hearing will in no way impair grand jury secrecy. It may also be appropriate for the district court to hear appellants' views on disclosure of documents with which they are familiar but do not own. We leave it for the district court to determine in the first instance, with reference to the policies underlying grand jury secrecy, whether adversary hearings should be held regarding other materials to which the government seeks access. 47 The order of the district court granting disclosure is vacated and the cause remanded for further proceedings consistent with this opinion. Pending these further proceedings, the district court shall take such steps as are, in its discretion, necessary to protect the appellants from the effects of past disclosure. To avoid continued or further improper disclosure, the mandate in this case shall issue forthwith. See Fed.R.App.P. 2. A petition for rehearing and a suggestion of rehearing en banc will be entertained in the ordinary fashion. See Fed.R.App.P. 35(b), 40.