Court Opinion

ID: 8937173
Source: CourtListenerOpinion
Date Created: 2022-11-27 07:37:52.113059+00
Date Added: 2024-06-11T17:09:39.071096
License: Public Domain

OAKES, Circuit Judge
(dissenting).
I am required to dissent.
In my mind, the most difficult question that this case presents is whether it is legitimate for a court in the exercise of its criminal contempt powers to place its imprimatur on a sting operation that has already begun under the supervision of private attorneys and that will continue to run without effective judicial oversight. In the court below, Judge Brieant found that Judge Lasker’s earlier approval of such an operation was appropriate and also saw no reason why it should matter whether an investigation occurs before or after the court appoints a special prosecutor, so long as the investigation proceeds with respect for defendants’ constitutional rights. United States ex rel. Vuitton et Fils S.A. v. Karen Bags, Inc., 592 F.Supp. 734, 743 (S.D.N.Y.1984) (Vuitton I); see also United States ex rel. Vuitton et Fils S.A. v. *187Karen Bags, Inc., 602 F.Supp. 1052, 1055-56 (S.D.N.Y.1985) (Vuitton 77). I see the issue as slightly more complicated. I believe the timing of the appointment and the extent of judicial oversight are of critical importance. Moreover, I believe that there are compelling reasons against court approval of such an operation: the private lawyer who participates in a sting operation almost necessarily runs afoul of the canons of legal ethics; the private lawyer who represents an interested party also lacks the knowledge of legal constraints on the investigatorial process and freedom from bias that a public prosecutor would have. A court should approve a sting operation only when it has determined that there is a strong showing that a court order has been violated and where there is no other way of catching the contemners. Such approval should also be conditioned on observance of strict guidelines.
Judge Lasker’s decision to authorize further investigation on the part of Vuitton is certainly understandable. This court had already held that in criminal contempt proceedings counsel for interested parties may in appropriate circumstances be appointed special prosecutors. See Musidor, B.V. v. Great American Screen, 658 F.2d 60 (2d Cir.1981), cert. denied, 455 U.S. 944, 102 S.Ct. 1440, 71 L.Ed.2d 656 (1982). Moreover, Sol Klayminc had previously violated a court order barring him from counterfeiting Vuitton goods. Nonetheless, attorneys for Vuitton should not have been vested with the investigatory powers of prosecutors. As indicated above, a number of factors must be balanced against the interest in catching contemners, and, in this case, those factors should have been found to be predominant.
Thus, in a situation such as this, the court should have considered the possibility that Vuitton’s campaign against would-be counterfeiters would not be thwarted by denying its attorneys sweeping investigatory powers. First, other methods of investigation would remain open. For instance, in Musidor, 658 F.2d 60, the key testimony came from a private investigator who never practiced any deception: he conducted surveillance, trailed a van, and purchased one of the items bearing the protected trademark from the back of the van. Second, a company like Vuitton, that has proved over and over again just what kind of counterfeiters it is up against, see In re Vuitton et Fils S.A., 606 F.2d 1, 2 (2d Cir.1979), could conceivably obtain judicial authorization before beginning the sting, although several cases and commentators have advanced the convincing contention that sting operations may be justified only to combat activities threatening “grave harm to our society,” such as the corruption of public officials. United States v. Kelly, 707 F.2d 1460, 1473 (D.C.Cir.), cert. denied, 464 U.S. 908, 104 S.Ct. 264, 78 L.Ed.2d 247 (1983); see also United States v. Myers, 692 F.2d 823, 843 (2d Cir.1982), cert. denied, 461 U.S. 961, 103 S.Ct. 2437, 77 L.Ed.2d 1322 (1983); Blecker, Beyond 1984: Undercover in America — Serpico to Abscam, 28 N.Y.L.Sch.L.Rev. 823, 975-82 (1984).1
Another factor to be considered in a case such as this is whether the court should refuse to approve an ongoing investigation in which lawyers may have previously violated ethical norms (as it appears, con-cededly in hindsight, Vuitton’s lawyers did here). A lawyer has the general duty not to “[ejngage in conduct involving dishonesty, fraud, deceit, or misrepresentation.” Model Code of Professional Responsibility DR 1-102(A)(4) (1980); see also Model Rules of Professional Conduct Rule 8.4(c) (1983). He also has the specific duty not to “knowingly make a false statement of law or fact.” Model Code DR 7-102(A)(5); see also Model Rule 4.1(a). These duties of lawyers exist even when the lawyers are *188not acting in their capacity as such. See ABA Comm, on Ethics and Professional Responsibility, Formal Op. 336 (1974) (duties of lawyers in respect to Watergate activities). In the words of Justice Frankfurter,
It is a fair characterization of the lawyer’s responsibility in our society that he stands “as a shield,” to quote Devlin, J., in defense of right and to ward off wrong. From a profession charged with such responsibilities there must be exacted those qualities of truth-speaking, of a high sense of honor, of granite discretion, of the strictest observance of fiduciary responsibility, that have, throughout the centuries, been compendiously described as “moral character.”
Schware v. Board of Bar Examiners, 353 U.S. 232, 247, 77 S.Ct. 752, 760, 1 L.Ed.2d 796 (1957) (Frankfurter, J., concurring). I believe that the duty to refrain from.conduct that involves dishonesty, fraud, deceit, or misrepresentation and the duty to speak the truth should preclude a private attorney from participating in a sting operation without first receiving court approval. Moreover, those fundamental tenets of the legal profession mandate that such approval be granted rarely and only under exceptional circumstances.
Nor is it available to argue that the chicanery here was performed by an investigative firm rather than by counsel themselves. As attorney Bainton’s affidavit in support of his motion seeking appointment as a special prosecutor and judicial approval of the investigation makes clear, these operations were conducted with his knowledge and approval. In addition, there is some suggestion in the record that the course of conduct by the Kanner security firm was not only ratified by Vuitton’s counsel, but that it was in part directed by them. In either case, attorneys who employ such a firm must be held to bear responsibility for the firm’s use of techniques that would be ethical violations if utilized by the attorneys directly. Lawyers cannot escape responsibility for the wrongdoing they supervise or ratify by asserting that it was their agents, not themselves, who committed the wrong. The history of Watergate eloquently demonstrates that lawyers have the capacity to perpetrate lawlessness by directing the behavior of others; the conviction of certain of Watergate’s lawyer-defendants, see, e.g., United States v. Ehrlichman, 546 F.2d 910 (D.C.Cir.1976) (“plumbers’ ” break-in at Ellsberg’s psychiatrist’s office), cert. denied, 429 U.S. 1120, 97 S.Ct. 1155, 51 L.Ed.2d 570 (1977); United States v. Liddy, 509 F.2d 428 (D.C.Cir.1974) (original Watergate break-in and wiretapping), cert. denied, 420 U.S. 911, 95 S.Ct. 833, 42 L.Ed.2d 842 (1975), evidences the fact that the lawyer who guides others into or profits by illicit behavior bears responsibility for acts done under his supervision. Such responsibility accords with agency law. See Restatement (Second) of Agency § 217D (1957) (principal may be subject to penalties for criminal acts of agents). It accords with the canons of legal ethics. See Model Rule 5.3 (lawyer responsible for the misconduct of nonlawyer employees or associates if the lawyer orders or ratifies the conduct); ABA Comm, on Ethics and Professional Responsibility, Informal Op. 1320 (1975) (deeming it unethical for lawyer to have his investigator tape colloquy with sales clerk without clerk’s knowledge). Most basically, it accords with the obligations and duties of lawyers in our society.
In reviewing Vuitton’s attorney’s application for approval of the investigation, the court should also have considered the possibility of imposing guidelines for and limitations on that investigation. If such an operation is to be approved, guidelines are necessary. Respect for the court, the end goal of contempt, may be diminished when a court approves an open-ended investigation by attorneys unrestrained by either institutional guidelines or the court’s own specific guidance. The Rule 42 order read in part (emphasis added): “Ordered that J. Joseph Bainton, Esq., and Robert P. Dev-lin, Esq., ... are hereby specially appointed to represent the United States of America in connection with the further investigation of the alleged aforesaid criminally con*189tumacious course of conduct and the ultimate prosecution therefor____” Obviously, such a broad order must be construed to permit only lawful investigations, and I will assume that Bainton and Devlin so understood it. See Vuitton I, 592 F.Supp. at 743. Indeed, the attorneys, to their credit, anxious to remain within the bounds of California law, did secure the supervision of the Los Angeles District Attorney over their electronic eavesdropping in California. But a lawful investigation may still fall far short of the careful investigation a judge would or should approve in advance; once the evidence is in, courts have a “well-established reluctance to dismiss criminal prosecutions because of faulty Government investigation.” United States v. Myers, 692 F.2d at 843. The standard appropriate in reviewing a completed investigation is not, however, the appropriate one for a court to use when it approves an investigation in advance. In the latter situation, there is no reason for the court not to require that the investigation be conducted with the utmost scrupulousness and respect for individual rights.
There are, however, I hasten to add, certain inherent problems with the decision to authorize an investigation conducted by attorneys for private parties. When there is a history of bitter litigation between the parties under investigation and the clients of the attorneys conducting the investigation, as there is in this case, a certain amount of animus against those being investigated on the part of the attorneys is all but inevitable. At the same time, those attorneys will frequently lack knowledge of all the limits that our laws require prosecutors to observe. Through inclination and ignorance, as well as lack of responsibility to the public, to higher authorities or to an electorate, or a combination of these, private attorneys are likely to fail to exhibit the self-restraint in conducting an investigation and the candor in admitting errors that are required of prosecutors and are of critical importance if our system is to work properly. Indeed, just such an argument was utilized in Judge Lumbard’s and my recent RICO opinion in Sedima, S.P.R.L. v. Imrex Co., 741 F.2d 482, 497 (1984), reversed on other grounds, — U.S. -, 105 S.Ct. 3275, 87 L.Ed.2d 346 (1985). Attorney Bainton’s affidavit in support of his motion seeking judicial approval of the investigation illustrates the problems with placing too great a faith in interested private attorneys. That affidavit clearly indicates that the court order barring counterfeiters was being violated. My reading of the record indicates instead that the defendants here had probably not violated the earlier order at that time and that the investigation may have been the proximate cause of the violation. Hindsight at least demonstrates the need for caution.
In the end, I am concerned not so much by this case — much less by these defendants’ plights — as by the thought that courts may put their stamps of approval on whatever undercover tactics lawyers or their hired investigators may devise short of the outrageous or illegal. Authorizing the nearly-outrageous and barely legal can hardly be said in the long run to preserve the dignity of the courts or secure their position of respect.
It is my belief, therefore, that the decision authorizing Bainton and Devlin to continue their investigation was incorrect. Accordingly, I would reverse the judgment.

. I note that after the order issued in this case, remedies against counterfeiters were unquestionably strengthened by the Trademark Counterfeiting Act of 1984, Pub.L. No. 98-473, §§ 1501-1503, 98 Stat. 2178 (codified at 15 U.S.C.A. §§ 1116-1118, 18 U.S.C.A. § 2320 (West Supp.1985)). In future cases, this law must be taken into account in considering the alternate remedies available to trademark holders.