Court Opinion

ID: 2667008
Source: CourtListenerOpinion
Date Created: 2014-04-04 13:03:00.327318+00
Date Added: 2024-06-11T15:48:31.226757
License: Public Domain

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

§
§
In re Grand Jury Investigation § Misc. No. 09-118 (RCL)
of Possible Violation of §
18 U.S.C. § 1461 et seq. § UNDER SEAL F l L E D
§ !JCT 2 5 2009
NNCY MAYER WH|TT|NGTON, CLERK
MEMORANDUM AND ORDER U~S- D'~°'TR’CT CGURT

The United States has requested that this Court compel Company X to
comply with four subpoenas issued by a grand jury sitting in this district and
served on Company X on September 5, 2008. Having considered the United
States’ motion to compel, Company X’s response, the reply thereto, and the
arguments of counsel, the United States’ motion is granted in part and denied in
part for the reasons set forth below.

I. BACKGROUND

On September 5, 2008, the United States served four grand jury subpoenas
on Company X. Gov ’t Motz'on to C0mpel at 2 [hereinafter Motion]. The
subpoenas sought four categories of information:l

(l) the name, address, and telephone number of the businesses that
processed financial transactions for Company X between December 1,
2007 and June 30, 2008;

(2) the names, positions, hours, location of employment, home address and
telephone numbers for all persons employed by Company X between
December 1, 2007 and June 30, 2008;

1 The numbers in this list correspond to the numbers of the subpoenas as referenced in the
United States’ motion.

(3) a copy of records identifying the true name(s) and alias(es) of the
owner(s) of Company X from its date of incorporation up to and
including June 2008;

(4) a copy of records that show the identity of all movies sold or
distributed, including the date of each transaction, payment received,
and method and date of each of each shipment, from customer
purchases from the website/domain name www.[ |.com between
December l, 2007 and December 15, 2007, and April l, 2008 and April
15, 2008.

Id. The subpoenas also requested that Company X provide a completed custodian
of records form for documents responsive to each subpoena. Ia’.

Company X provided documents responsive to Subpoenas One and Two;
however, they did not complete the requested custodian of records forms. Ia’. at 3.
No documents were produced in response to Subpoena Three, which requested
materials identifying the owner of Company X. Id. Lastly, Company X
responded to Subpoena Four by providing only records for sales made in the
District of Columbia and redacting the names of the customers from those records.
Id.

Af`ter first discussing the standards for quashing a subpoena, this
memorandum and order addresses Company X’s refusal to provide custodian of
records for1ns, infra Part III, and then evaluates the company’s refusal to comply
with Subpoenas Three and Four, infra Parts IV and V respectively.

II. STANDARD FOR QUASHING A GRAND JURY SUBPOENA

The grand jury’s charge is to investigate whether a crime has been

committed and to make any and all inquiries until it is satisfied one way or the

other. United States v. R. Enterprz`ses, Inc., 498 U.S. 292, 297 (l99l). But the
grand jury’s "power is not unlimited." United States v. Calana'ra, 414 U.S. 338,
346 (1974). Its powers are constrained by any valid privilege, whether established
by the Constitution, statute, or the common law. Id.; see also Branzburg v. Hayes,
408 U.S. 665, 688 (1972) ("Although the powers of the grand jury are not
unlimited and are subject to the supervision of a judge, the longstanding principle
that ‘the public . . . has a right to every man’s evidence,’ except for those persons
protected by a constz`tutional, cornrnon-law, or statutory prz'vz`lege, is particularly
applicable to grand jury proceedings.") (citations omitted) (emphasis added). A
court may quash a subpoena where compliance would be unreasonable or
oppressive. FED. R. CRIM. P. l7(c)(2). While what is reasonable depends on the
context, it is clear that a subpoena may be quashed if it cannot withstand
constitutional scrutiny. R. Enters., 498 U.S. at 299; In re Grand Jury, John Doe
No. G.J. 2005-2, 478 F.3d 58l, 585 (4th Cir. 2007) (stating Rule l7(c) offers a
vehicle for a subpoenaed party to assert a constitutional challenge). When
deciding whether to quash a subpoena, it must be remembered, however, that a
grand jury is presumed to act within the scope of its legitimate authority, absent a
strong showing to the contrary. R. Enters., 498 U.S. at 301 (citations omitted).

III. CUSTODIAN OF RECORDS FORMS

The United States’ motion seeks that Company X’s custodian of records be
required to qualify responsive documents as business records under Federal Rule

of Evidence 803(6) by either completing a business records form or testifying

before the grand jury. The company’s custodian of records, Mr. X_who is also
the company’s sole shareholder and president-has invoked his Fifth Amendment
right against self-incrimination as the basis for his refusal to complete the forrns.
Response at 10.

A corporation itself has no Fifth Amendment privilege. Braswell v. United
States, 487 U.S. 99, 104-105 (1987). As an extension of this rule, a company’s
custodian of records may not resist a subpoena to the company by invoking his
own Fifth Amendment privilege. Ia’. at 117 . The conflict between the custodian’s
individual privilege and the company’s lack of privilege has several consequences,
some more farcical than others. For example, while the government may not use
the custodian’s act of production against the custodian himself, the company ’s act
of production may be used against the custodian_even though they are one in the
same absent this legal f`1ction. Ia’. at 118. And because production of the
documents may be compelled against the custodian, several courts have held that
some (very) limited testimony may also be compelled if it is auxiliary to the act of
production. See Curcio v. United States, 354 U.S. ll8, 125 (1957); In re Grana'
Jury Empanelea' on Apr. 6, ]993, 869 F. Supp. 298, 301 (D.N.J. 1994); see also In
re Grana’ Jury Proceea'ings, 473 F. Supp. 2d 201, 205 (D. Mass. 2007). The
Supreme Court has explained:

The custodian’s act of producing books or records in response to a

subpoena duces tecum is itself a representation that the documents

produced are those demanded by the subpoena. Requiring the custodian to
identify or authenticate the documents for admission into evidence merely

makes explicit what is implicit in the production itself. The custodian is
subjected to little, if any, further danger of incrimination.

Curcio, 354 U.S. at 125; see also Braswell v. United States, 487 U.S. 99, 114
(l988). The D.C. Circuit has elaborated that "although an officer who produces
books and records may be required to produced ‘auxiliary information,’ such as
authentication of the items produced, this doctrine is sharply limited to
information which creates no danger of incrimination." Communist Parly v.
United States, 331 F.2d 807, 813 (D.C. Cir. 1963).

As such the Court must consider whether completing the custodian of
records forms is auxiliary to the act of production and whether doing so would
create any further danger of incrimination. Two courts have held that a custodian
may not be compelled to complete such forms over the assertion of his Fifth
Amendment rights, see In re Grana' Jury Proceeclings, 473 F. Supp. 2d 201; In re
Grana’ Jury E)npanelea’ on Apr. 6, 1993, 869 F. Supp. 298, while one court has
that custodian may be so compelled, see In re Trial Subpoena Duces Tecum, 927
F.2d 244 (6th Cir. 1991).

Although the Supreme Court has held that a custodian may be compelled to
authenticate documents, Curcz'o, 354 U.S. at 125, qualifying documents under
Rule 803(6) entails more than just authentication. Authentication is merely a
condition precedent for admissibility, whereas qualifying a document as a business
record establishes both admissibility as well as authenticity. Compare FED. R.

EVID. 803(6) with FED. R. EVID. 901; see also In re Grana' Jury Empanelea' on

Apr. 6, 1993, 869 F. Supp. at 304. Mr. X, if called on solely to authenticate the
documents, would only be required to state that the documents that have been
produced are those responsive to the subpoena. This testimony, by itself, would
merely make explicit what was implicit in the production of the documents and as
such it is auxiliary to the act of production. See Curcz`o, 354 U.S. at 125.
Requiring Mr. X to qualify the documents as business records would involve far
more, and likely poses a danger of self-incrimination. lf compelled, Mr. X would
have to testify about Company X’s business practices, that the records were made
at or near the time of the events they record, and by or from a person with
knowledge of the events recorded therein. See FED. R. EVID. 803(6). None of that
testimony is implicit in the act of production, see Curcio, 354 U.S. at l25, nor is it
clear that it would not be incriminatory.z One of the district courts that quashed
such a subpoena did so relying on this rationale. In re Grand Jury Empaneled on
Apr. 6, 1993, 869 F. Supp. at 306. The other did so solely on the ground that
business records testimony was not implicit in the act of production. In re Granal
Jury Proceea’ings, 473 F. Supp. 2d at 201.

One court, however, has held that a custodian may be compelled to qualify
subpoenaed documents as business records. In re Trial Subpoena Duces Tecurn,
927 F.2d at 251 [hereinafter Variezfy Distrz'buting]. The Varz'ey Distrz'buting court

seized on language from Curcz`o that seemed to contemplate admissibility rather

2 Indeed, given the possible offenses being investigated, this would likely amount to a
confession if an indictment were returned.

than just authentication. Id. at 248. Indeed, the Curcio court did say that a
custodian may be compelled to "authenticate the documents for admission into
evidence," Curcio, 354 U.S. at 125. But all documents must be authenticated
before they can be admitted into evidence. FED. R. EVID. 901. And when read in
context, it is clear that Curcio only contemplates testimony that "makes explicit
what is implicit in the production itself" and creates "little, if any, further danger
of incrimination." 354 U.S. at 125. While one cannot overlook the "for admission
into evidence" language, it cannot be read out of context either. And the context
makes clear that testimony that is not making explicit what was implicit in
production is imperrnissible. Furthermore, because authentication is a predicate
for admission, limiting testimony that may be compelled to authentication alone is
consistent with Curcio.

There are some additional reasons to be wary of compelling Mr. X to
testify, as it is not clear what purpose (at least at this stage) would be served by
compelling Mr. X to qualify responsive documents as business records. There is
no prohibition against presenting hearsay to the grand jury; in fact, it is explicitly
permitted. FED. R. EVID. ll0l(d)(2) ("The rules (other than with respect to
privileges) do not apply [to] [p]roceedings before grand juries."); see also R.
Enters., 498 U.S. at 298 ("[M]any of the rules and restrictions that apply at a trial
do not apply in grand jury proceedings. This is especially true of evidentiary

restrictions."); United States v. Calandra, 414 U.S. 338, 343 (1974) (stating that

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the grand jury’s "operation generally is unrestrained by the technical and
evidentiary rules governing the conduct of criminal trials.").

Compelling Mr. X to provide Rule 803(6) testimony or complete the
custodian of records form would violate his Fifth Amendment right by requiring
him to provide testimony that is not auxiliary to the act of production, and as such
he may not be compelled to do so. Furthermore, though the documents provided
in response to the grand jury’s subpoenas have already been authenticated, see
Curcio, 354 U.S. at l25, Mr. X may still be properly required to identify the
documents produced as those responsive to the subpoena, but no more.
Accordingly, the United States’ motion is denied to the extent that it seeks to
compel Company X’s custodian of records to provide Rule 803(6) testimony or
complete custodian of records forms regarding documents responsive to the grand
jury’s subpoenas.

IV. SUBPOENA THREE

Subpoena Three seeks "a copy of records identifying the true name(s) and
alias(es) of the owner(s) of Company X from its date of incorporation up to and
including June 2008." In its response Company X asserts that the United States
already possesses records identifying Company X’s owner from a prior
investigation. Response at 2. Company X also concedes that the information in
those records is still correct and that Mr. X continues to be the sole owner of
Company X. 1d at 3. But still, those records are only current through 2007 and

the subpoena seeks records through June 2008.

Rule l7(e) only allows a subpoena to be quashed if it violates a
constitutional, statutory, or common law privilege or if it is unreasonable or
oppressive. Calandra, 414 U.S. at 346. Company X has not identified why this
subpoena would run afoul of Rule l7(e), and it hardly seems that requiring them to
provide updated corporate records would be unreasonable or oppressive. See R.
Enters., 498 U.S. at 299 (stating reasonability depends on context). Since
Company X has provided no grounds on which Subpoena Three may be properly
quashed, compliance should be compelled, Therefore, the United States’ motion
to compel production of documents responsive to Subpoena Three is granted.

V. SUBPOENA FOUR

In its motion to compel the United States asserts that Company X has failed
to comply with Subpoena Four by redacting customer names from the records it
provided and furthermore by only providing records for sales made in the District
of Columbia. Motion at 3. (The United States has since limited its request under
Subpoena Four for information about sales outside the District of Columbia to
only seek the city and state where shipments were made and not the names of
customers. Reply at 4.) Until the United States proves otherwise, the expressive
materials being investigated are presumptively protected by the First Amendment

and Company X’s customers have a correlative right to receive that information

anonymously.3 Until the United States proves that the materials are obscene, it
will need to demonstrate both a compelling interest in the sought-after materials
and a sufficient nexus between the information sought and the grand jury’s
investigation in order to obtain the redacted inforrnation.

A. The materials the grand jury seeks are presumptively protected by the First
Amendment.

Though obscene materials are not protected by the First Amendment,
Ashcroft v. ACLU, 535 U.S. 564, 574 (2002) (citing Roth v. United States, 354
U.S. 476, 484~85 (1957)), sexual expression that is not obscene is protected, Sable
Commc’ns of Californz`a, Inc. v. FCC, 492 U.S. ll5, 126 (1969).4 Furthermore,
expressive materials are entitled to presumptive First Amendment protection. Cf
Fort Wayne Books, Inc. v. Indiana, 489 U.S. 46, 63 (1989); see Boggs v. Merletti,
987 F. Supp. 2d l, 6 n.2 (D.D.C. 1997); see also In re Subpoena Duces Tecum,
829 F.2d 1291, 1296 n.5 (4th Cir. 1987). The Govemment’s briefing assumes that

the films being investigated by the grand jury are obscene, and therefore that they

3 Though neither party has raised the issue, the Court notes that Company X has standing
to challenge the subpoena on behalf of its customers. Virginia v. American Booksellers
Ass ’n, 484 U.S. 383, 392~393 (l988).

4 Deciding what materials are obscene, and therefore not protected by the First
Amendment, has proved a difficult task. Ashcroft v. ACL U, 535 U.S. at 574.
Accordingly, courts have emphasized the need to proceed cautiously when tackling
obscenity questions as "[t]he line between speech unconditionally guaranteed and speech
which may be legitimately regulated, suppressed, or punished is finely drawn." Marcus
v. Search Warrant, 367 U.S. 717, 730-31 (1961) (quoting Speiser v. Randall, 357 U.S.
513, 525 (1958)). In several cases involving the seizure of allegedly obscene materials,
courts have emphasized the need for additional procedural safeguards to protect First
Amendment rights. See id.; see also Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 66
(1963) ("Our insistence that regulations of obscenity scrupulously embody the most
rigorous procedural safeguards . . . [is] but a special instance of the larger principle that
the freedoms of expression must be ringed about with adequate bulwarks.").

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are not entitled to First Amendment protection. However, as of yet there has been
no judicial determination that the films being investigated are in fact obscene. As
such they are entitled to the protection of the First Amendment.

A corollary First Amendment right is the right to receive ideas. "It is now
well established that the Constitution protects the right to receive information and
ideas . . . . This right to receive information and ideas, regardless of their social
worth, is fundamental to our free society." Stanley v. Georgia, 394 U.S. 557, 564
(1969) (citations omitted); see also Kleindienst v. Mandel, 408 U.S. 753, 762
(1972); Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 65 n.6 (1963) ("The
constitutional guarantee of freedom of the press embraces the circulation of books
as well as their publication."). Here if the subpoenaed customer records are given
to the Government, it could have a chilling effect on the exercise of Company X’s
customers’ First Amendment rights. As Justice Douglas once wrote "[a]
requirement that a publisher disclose the identity of those who buy his books,
pamphlets, or papers is indeed the beginning of surveillance of the press . . . .
Once the government can demand of a publisher the names of the purchasers, the
free press as we know it disappears . . . the purchase of a book or pamphlet today
may result in a subpoena tomorrow." United States v. Rumley, 345 U.S. 41, 47
(1953) (Douglas, J., concurring). This Court has once before recognized the First
Amendment implications of a subpoena for such records. See In re Grand Jury
Subpoena to Kramerbooks & Afterwords, Inc., Nos. 98-MC-135-NHJ, 98-MC-

138-NHJ, 26 Med. L. Rptr. 1599, 1600 (D.D.C. Apr. 6, 1998); see also 1n re

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Grand Jury Subpoena to Amazon.com dated Aug. 7, 2006, 246 F.R.D. 570, 572
(W.D. Wis. 2007) ("This presents a legitimate First Amendment concem. The
subpoena is troubling because it permits the government to peek into the reading
habits of specific individuals without their prior knowledge or permission.").
Because the subpoena seeks records of customer purchases of expressive
materials, which are presumptively protected by the First Amendment, the records
are presumptively protected as well. Therefore, the United States may only obtain
the records if it demonstrates a compelling need for them and a sufficient nexus
between the records and the grand jury’s investigation, or if it shows that they are
not entitled to the protection of the First Amendment, which it has not attempted
to do.
B. Standard of Review

In Branzburg v. Hayes, the Supreme Court stated "[w]e do not expect
courts will forget that grand juries must operate within the limits of the First
Amendment. . . ." 408 U.S. at 708. This Court has not forgotten. But it also
remembers that while the First Amendment generally restricts government from
regulating expression, it is not absolute. Ashcroft v. ACLU, 535 U.S. at 573. And
despite its admonition in Branzburg, the Supreme Court has yet to define the
appropriate standard for reviewing grand jury subpoenas that implicate First
Amendment concems. Amazon.com, 246 F.R.D. at 572. However, several courts
of appeal, in addition to this Court, have adopted a two-part test to determine

whether to enforce a subpoena that may infringe on First Amendment rights. See

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1n re Grand Jury Subpoena Duces Tecum, 78 F.3d 1307, 1312 (8th Cir. 1996); In
re Grand Jury Proceedings, 776 F.2d 1099, 1102-1103 (2d Cir. 1985);
Kramerbooks 26 Med. L. Rptr. at 1600. In order to survive a First Amendment
challenge the government must show that they have a compelling interest in
obtaining the sought-after material and that there is a sufficient nexus between the
subject matter of the investigation and the information they seek. Kramerbooks,
26 Med. L. Rptr. at 1601.

The United States argues that the Kramerbooks standard is not appropriate
and that this Court should instead "balance the govemment’s need for documents
against the possible constitutional infringement . . .without placing any special

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burden on the govemment. Reply at 3 (citing In re Grand Jury 87-3 Subpoena
Duces Tecum, 955 F.2d 229, 234 (4th Cir. 1992)). To support its position the
United States claims that the Supreme Court has twice declined to apply the
substantial relationship test in cases where subpoenas implicating First
Amendment interests were challenged. Id. (citing Pennsylvania v. EEOC, 493
U.S. 182 (1990) and Branzburg v. Hayes, 408 U.S. 665). This reading of Supreme
Court precedent is incorrect though, because neither case held a First Amendment
right was implicated by the subpoenas being reviewed, and as such neither court
considered whether the substantial relationship would be the appropriate standard
of review for a subpoena implicating First Amendment interests. See

Pennsylvania v. EEOC, 493 U.S. at 199 ("[W]e think the First Amendment cannot

be extended to embrace petitioner’s claim."); id. at 201 ("Because we conclude

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that the EEOC subpoena process does not infringe any First Amendment right
enjoyed by petitioner, the EEOC need not demonstrate any special justification to
sustain the constitutionality of Title VII as applied to tenure peer review
materials . . . ."); Branzburg, 208 U.S. at 708 ("If there is no First Amendment
privilege to refuse to answer the relevant and material questions asked during a
good-faith grand jury investigation, then it is a fortiori true that there is no
privilege to refuse to appear before such a grand jury until the Government
demonstrates some ‘compelling need’ for a newsman’s testimony."). As such
Pennsylvania v. EEOC and Branzburg v. Hayes are inapposite as neither had
occasion to fashion a test, given that neither case found a First Amendment right
was implicated by the challenged subpoenas. One court has repeated this
mistaken assumption that the Supreme Court had twice declined to apply the
substantial relationship test, which perhaps explains some of this confusion. See
In re Grand Jury 87-3, 955 F.2d at 234 (citing Pennsylvania v. EEOC, 493 U.S.
182 and Branzburg, 408 U.S. 665). And while that court adopted the test
advocated by the government, it also did so after concluding that the case before it
was "not a case in which First Amendment rights are implicated." Id. at 234.
Because actual First Amendment rights are implicated in this case, unlike in any of
the three cases cited by the United States, this Court declines to adopt that
position, and instead chooses to follow the test enunciated in Kramerbooks and

Amazon.com.

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C. Has the Government met its burden?

In addition to several other obscenity statutes, the grand jury is
investigating a possible violation of 18 U.S.C. § 1466, which criminalizes the
interstate or foreign shipment of obscene materials by those persons engaged in
the business of producing obscene material with intent to distribute or sell, or
engaged in the business of selling or transferring obscene materials.5 The statute
creates a presumption that a person is "engaged in the business" if a person offers
two or more copies of any obscene materials or a total of five or more obscene
materials for sale or transfer at any one time. 18 U.S.C. § 1466(b). The
Govemment contends that in order to trigger this presumption "proof of multiple
sales must be given." Reply at 3. The United States does not, however,
demonstrate how the subpoenaed records fail to establish proof of multiple sales
and Company X even concedes that the redacted records demonstrate a sufficient
number of sales to trigger the presumption (though it denies that the materials sold
are obscene). Response at 9. Company X also points out that the undercover
agent could have purchased two copies of the same title or five copies of different
titles to gather enough proof to trigger the presumption. Id. (lndeed, two of the
records show that five titles were purchased at the same time, which should itself
be enough to trigger the presumption, assuming that all of those titles are shown to

be obscene.) Still it should be noted that the United States does not need this

5 The United States’ briefs only address the reasons why the subpoenaed materials would
assist with the grand jury’s investigation of a possible violation of 18 U.S.C. § 1466. As
a consequence this Court only analyzes the reasons the Govemment offered in its briefs.

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presumption to prove its case, it merely needs to show that the distributor is
"engaged in the business" which means that "the person who produces[,] sells or
transfers or offers to sell or transfer obscene material devotes time, attention, or
labor to such activities, as a regular course of business, with the objective of
earning a profit . . . ." 18 U.S.C. § l466(b). What the names of the customers who
made these purchases have to do with this presumption is unclear to this Court,
and since the records produced by Company X already go towards establishing the
presumption, the United States’ proffered reason is not compelling.

The United States also argues that its agent does not have a First
Amendment right at stake, and as a result there is no basis for redacting the agent’s
name from the records provided in response to the subpoena. Reply at 4. But
because providing Company X with the agent’s name would break the secrecy of
the grand jury’s investigation, id., it would prefer that this Court order all three
responsive records to be turned over unredacted. Here the three records that are
responsive to the subpoena are each unique. And because the responsive records
are receipts, presumably an unredacted copy of the agent’s receipt is already in the
grand jury’s possession. Even if one is not, it should not be all that difficult for
the United States to pick out which records correspond to their agent’s purchases
since no two titles purchased are the same.

That so few records are at issue also undercuts the Government’s argument
that breaking grand jury secrecy here would result in the sort of broad disclosure

that would "afford[] the targets of the investigation far more information about the

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grand jury’s internal workings than the Federal Rules of Criminal Procedure
appear to contemplate." R. Enters., 498 U.S. at 299. The three subpoenaed
receipts only record the purchase of seven films. And since no two titles
purchased are the same, the only way the Government could have gathered enough
evidence to establish the presumption that Company X was engaged in the
business of distributing and selling obscene materials would have been by
showing that Company X offered five or more copies of an obscene movie at one
time. See U.SC, § l466(b). One needn’t be Sherlock Holmes to deduce which
records go towards establishing the presumption, as only two receipts show a
combination of five titles being sold at one time. Because disclosure of which
purchases were made by the undercover agent would not allow Company X to
peer into the inner workings of the grand jury, the Government’s rationale for why
the Court should order disclosure as to all the records is not compelling.

But that is still just conjecture; the Government might not have purchased
five titles in its investigation. The grand jury may not be investigating all the titles
in Company X’s catalog or all those sold in the District of Columbia. Indeed, it is
implied that they are not. See Reply at 4 ("If the FBI agent’s name is the only
name tumed over, then Company X will know precisely the matter being
investigated, including the specific movies the grand jury is considering for
possible prosecution. . . .") (emphasis added). Even if the government proves the
titles the grand jury is investigating are obscene the subpoena still faces a problem

of over breadth. See NAACP v. Alabama, 377 U.S. 288, 307 (l964) ("A

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governmental purpose to control or prevent activities constitutionally subject to
state regulation may not be achieved by means which sweep unnecessarily broadly
and thereby invade the area of protected freedoms."). Should the Government
prove at trial that the titles it is investigating are obscene, any remaining titles
Company X has sold in the District of Columbia are still entitled to First
Amendment protection. And customers who purchased those titles would still
enjoy a presumptive First Amendment right to receive them anonymously. This
Court does not know which titles were purchased by the government agent, nor
does it know how many purchases the agent made. Revealing all the customer
names here to protect the govemment’s minimal interest in grand jury secrecy
would prove too much as it might infringe on the legitimate First Amendment
interests of Company X’s customers. Because the subpoena here is overbroad,
and would infringe upon legitimate First Amendment rights, it will not be
enforced as written.

Because none of the government’s proffered reasons for ordering Company
X to comply with the subpoena are compelling, the United States’ motion to
compel is denied as to the unredacted records of purchases made in the District of
Columbia.
D. Records of Sales Made Outside the District of Columbia

Subpoena Four originally sought not only those records of sales made in the
District of Columbia, but also records of all sales made during the relevant time

periods anywhere. The United States has since limited its request under Subpoena

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Four for information about sales outside the District of Columbia to exclude the
names of customers. Reply at 4. Because the United States no longer seeks the
names of customers who purchased materials from Company X, the First
Amendment rights of Company X’s customers are no longer implicated.
Accordingly, the Kramerbooks standard of review is not appropriate for
examining whether the grand jury is entitled to redacted customer records for
purchases made outside the District of Columbia. Instead, the appropriate
standard for review is that enunciated in R. Enterprises. When "a subpoena is
challenged on relevancy grounds the motion to quash must be denied unless the
district court determines that there is no reasonable possibility that the category of
materials the Govemment seeks will produce information relevant to the general
subject of the grand jury’s investigation." R. Enterprises, 498 U.S. at 301. And
although the First Amendment rights of Company X’s customers are not
implicated by these final records, the First Amendment, in particular the obscenity
doctrine, still has a bearing on their relevance. And because of the patchwork
nature of obscenity law, the Court is convinced that Company X has met the
demanding R. Enterprises standard.

In developing a definition of obscenity the Supreme Court noted that "[i]t is
neither realistic nor constitutionally sound to read the First Amendment as
requiring that the people of Maine or Mississippi accept public depiction of
conduct found tolerable in Las Vegas, or New York City." Miller v. California,

413 U.S. 15, 32 (1973). In Miller the Court "succeeded" in "defin[ing] what may

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be indefinable." Jacobellis v. Ohio, 387 U.S. 184, 197 (Stewart, J., concurring).
Miller set out the following test for determining whether something was obscene:

(a) whether ‘the average person, applying contemporary community

standards’ would find that the work, taken as a whole, appeals to the

prurient interest, (b) whether the work depicts or describes, in a patently

offensive way, sexual conduct specifically defined by the applicable state

law; and (c) whether the work, taken as a whole, lacks serious literary,

artistic, political, or scientific value.
Miller, 413 U.S. at 24 (intemal citations omitted). As implied by Miller what is
constitutionally punishable in one jurisdiction might be constitutionally protected
in another. This aspect of the test has been criticized as burdening publishers who
choose "to send their products in interstate travel" by forcing them "to cope with
the community standards of every hamlet into which their goods may wander."
Hamling v. United States, 418 U.S. 87, 144 (1974) (Brennan, J., dissenting).
While it is certainly a peculiar constitutional doctrine that protects a film’s
distribution in one place but allows it to be punished in another, the "variegated
standards" the Miller test creates have consequences for prosecutors and grand
juries as well.

The charge of the grand jury is to investigate crimes committed within the
district where it sits. See 18 U.S.C. § 3332 ("lt shall be the duty of each such
grand jury impaneled within any judicial district to inquire into offenses against
the criminal laws of the United States alleged to have been committed within that

district."). Sometimes crimes committed in other districts will have a bearing on

such an investigation and will help the grand jury investigate crimes committed in

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L_l______

its district. For example, understanding how a drug trafficking network operates
in other places might help a grand jury determine how that network distributes
drugs in its own district. But distributing narcotics is illegal whether in
Washington, D.C. or Boise, Idaho. Pornography is different because its
distribution is only criminal if it is obscene or if it involves the exploitation of
minors. And what is obscene, and therefore cannot be distributed legally, can vary
from place to place. This is because fact finders have to apply "contemporary
community standards" to determine whether the materials distributed are obscene
and in this they are limited to applying the standards of their own community. lt
would violate due process for a fact finder in one place to determine that Company
X had distributed obscene materials in some other community, where the threshold
for obscenity might be higher. Indeed, the distribution of pomography from the
San Fernando Valley to just across the Potomac in Virginia could be perfectly
legal and constitutionally protected; even though those same materials might be
found to be obscene in Washington, which would make their distribution here
illegal.

The grand jury investigating Company X is similarly limited to using its
members’ sense of this community’s standards to determine whether there is
probable cause to believe that the materials being distributed here are obscene.
Company X’s distribution of pornography in other communities has no relevance
to this deterrnination. While grand juries investigatory powers are broad, they are

not licensed to engage in fishing expeditions, R. Enterprises, 498 U.S. at 299, and

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l

because of the geographic limitations of the Miller test, this search for records
from outside the District of Columbia cannot be anything but. When some other
grand jury thinks it necessary to begin an investigation of Company X’s activities
in its district, because it believes that Company X’s films may be obscene under
its community’s standards, records of sales in that district would be relevant, but
again only to that grand jury’s investigation, not this one’s.

Because expressive materials are presumptively protected by the First
Amendment and a grand jury in the District of Columbia cannot apply community
standards for any community other than its own, Company X’s distribution of
films outside the District of Columbia has no relevance to this grand jury’s
investigation, even if those same films distributed other places are later found to
be obscene here. See id. As such, the United States’ motion to compel production
of sales records from outside the District of Columbia is denied.

VI. CONCLUSION

For the reasons set for the above, it is hereby ordered that the United States’
motion to compel the custodian of records of Company X to qualify responsive
documents as business records under Rule 803(6) is DENIED;

lt is further ordered that the United States’ motion to compel the production
of unredacted documents responsive to Subpoena Four is DENIED;

lt is further ordered that the United States’ motion to compel the production
of documents responsive to Subpoena Four regarding transactions outside the

District of Columbia is DENIED; and

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lt is further ordered that the United States’ motion to compel the production
of documents responsive to Subpoena Three is GRANTED, and that such
documents shall be produced within ten days of this date.
so oRDERED this jj[f¢l§y ofiuiy 2009.
Q“t/¢O 
RofdcE c. `LAMBERTH

Chief Judge
United States District Court

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