In re A Witness before the Special Grand Jury 2000-2 ( 2002 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 01-3386
IN RE: A WITNESS BEFORE THE SPECIAL
GRAND J URY 2000-2.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 98 GJ 596—Marvin E. Aspen, Chief Judge.
ARGUED OCTOBER 29, 2001 — DECIDED APRIL 23, 2002*
Before FLAUM, Chief Judge, and POSNER and DIANE P.
WOOD, Circuit Judges.
DIANE P. WOOD, Circuit Judge. The central question on
this appeal is whether a state government lawyer may
refuse, on the basis of the attorney-client privilege, to
disclose communications with a state officeholder when
faced with a grand jury subpoena. The district court found
that in the context of a federal criminal investigation, no
such government attorney-client privilege existed. We
agree with this determination, and therefore affirm.
I
Roger Bickel was employed by the state of Illinois as
Chief Legal Counsel to the Secretary of State’s office
*
This opinion is being initially released in
typescript. The printed version will follow.
2 No. 01-3386
during the first four years of former Secretary (now
Governor) George Ryan’s administration. Bickel provided
legal counsel and advice to Ryan and other Secretary of
State officials as they carried out their public duties.
Bickel has also served as a personal lawyer to Ryan, his
wife, and Ryan’s campaign committee, Citizens for Ryan,
since at least 1989.
For the past three years, federal prosecutors have been
investigating a “licenses for bribes” scandal in the Illinois
Secretary of State’s office, dubbed “Operation Safe Road.”
The alleged (and in some instances admitted) corruption
extends to the improper issuance of commercial drivers’
licenses, specialty license plates, leases, and other
contracts; the improper use of campaign funds for the
personal benefit of Secretary of State employees; and
obstruction of justice in connection with internal office
investigations. Because of his role in advising then-
Secretary Ryan, federal prosecutors soug ht to discuss
these matters with Bickel. Initially, they tried scheduling
a voluntary interview with him for this purpose, but Ryan
objected to the meeting and advised both Bickel and the
federal prosecutors that he had not waived and would not
waive the attorney-client privilege with respect to any of
his prior conversations with Bickel.
After several avenues for resolving the problem proved
unsuccessful, the federal prosecutors served a subpoena
from the grand jury that commanded Bickel to appear and
testify before that body about all conversations he had
with Ryan in his official capacity as General Counsel.
They also obtained a motion to compel Bickel to testify
about those matters. Finally, the United States secured a
letter from Illinois’ current Secretary of State, Jesse
White, in which the latter purported to waive the Office’s
attorney-client privilege as to all of Bickel’s official
conversations with “all personnel and officials of the
Secretary of State, regardless of their particular position
or office.” Ryan continued to oppose all efforts to obtain
allegedly privileged information from Bickel.
No. 01-3386 3
On September 7, 2001, the district court granted the
United States’ motion to compel, finding that no attorney-
client privilege attached to the communications at issue,
and, alternatively, that if a privilege did attach, White had
effectively waived it. While the motion to compel does not
create a final judgment, we permit clients to immediately
appeal a court order that their attorney testify before a
grand jury under the exception recognized in Perlman v.
United States, 247 U.S. 7 (1918). See United States v.
Evans, 113 F.3d 1457, 1458 (7th Cir. 1997); In re Grand
Jury Proceeding, 68 F.3d 193, 195 (7th Cir. 1995); United
States v. Davis, 1 F.3d 606, 607 (7th Cir. 1993). We
therefore have jurisdiction over this appeal.
II
We review de novo the question whether Ryan may
invoke the attorney-client privilege to shield Bickel’s
testimony before the federal grand jury. See Upjohn Co. v.
United States, 449 U.S. 383 (1981). The federal courts have
authority to recognize privilege claims under the federal
common law. Fed. R. Evid. 501. While Rule 501 manifests
a congressional desire to grant courts the flexibility to
determine privileges on a case-by-case basis, Trammel v.
United States, 445 U.S. 40, 47 (1980), “these exceptions to
the demand for every man’s evidence are not lightly
created nor expansively construed, for they are in
derogation of the search for truth.” United States v. Nixon,
418 U.S. 683, 710 (1974); In re Grand Jury Proceedings, 220
F.3d 568, 571 (7th Cir. 2000).
One of the oldest and most widely recognized privileges
is the attorney-client privilege, which protects
confidential communications made between clients and
their attorneys for the purpose of securing legal advice.
Swidler & Berlin v. United States, 524 U.S. 399, 403 (1998).
It is well established that a client may be either an
individual or a corporation. See, e.g., Upjohn, 449 U.S. at
390 (1981). But here, we have a special case: the client is
neither a private individual nor a private corporation. It
4 No. 01-3386
is instead the State of Illinois itself, represented through
one of its agencies. There is surprisingly little case law on
whether a government agency may also be a client for
purposes of this privilege, but both parties here concede
that, at least in the civil and regulatory context, the
government is entitled to the same attorney-client
privilege as any other client. See Green v. IRS, 556 F.
Supp. 79, 85 (N.D. Ind. 1982) (privilege “unquestionably”
applies to conversations between government lawyers and
administrative personnel), aff’d, 734 F.2d 18 (7th Cir.
1984); Restatement (Third) of Law Governing Lawyers § 74
(2000) (“[T]he attorney-client privilege extends to a
communication of a governmental organization.”). We
therefore proceed on that basis.
In the case of private parties, the privilege functions
identically in both civil and criminal proceedings.
Swidler, 524 U.S. at 408-09 (finding “no case authority for
the proposition that the privilege applies differently in
criminal and civil cases”). The United States, however,
contends that the privilege between a government
attorney and her official client does not extend to criminal
proceedings, such as a grand jury investigation. It is
supported in that position by decisions of two courts of
appeals (both with thoughtful dissents) arising from
Independent Counsel investigations of President Clinton.
See In re Lindsey, 158 F.3d 1263 (D.C. Cir. 1998); In re
Grand Jury Subpoena Duces Tecum, 112 F.3d 910 (8th Cir.
1997). Ryan argues that those cases were wrongly decided,
at least insofar as they might apply here to support a
distinction between governmental clients and private
clients.
The first question we face is whether recognizing a
privilege in this case would be an expansion of the current
scope of the attorney-client privilege, or if a refusal to
recognize the privilege would amount to a contraction of
an existing privilege. Although this may seem like two
sides of the same coin, it is not: the Supreme Court has
instructed us, in developing a federal common law of
No. 01-3386 5
privileges, to avoid either derogating existing privileges
or extending privileges to new, uncharted waters absent
compelling considerations. Jaffee v. Redmond, 518 U.S. 1,
9 (1996). Unfortunately, there is no clear-cut answer to
this question because, outside of former Secretary Ryan
and the Clinton administration, only one government
body, the Detroit City Council, has ever attempted to
claim such a privilege in the criminal context. In re Grand
Jury Subpoena, 886 F.2d 135 (6th Cir. 1989). Thus, one
could argue either that, since historically the privilege has
never been claimed, recognizing it would be an extension,
or that, since no court has ever recognized a civil-criminal
distinction to the privilege, creating one here would
constitute an exception.
While Swidler rejected a civil-criminal distinction for
the privilege as to individuals, other courts have
recognized that the governmental context is different,
even after that decision, and have limited the privilege for
governmental agencies in the criminal context. See
Lindsey, 158 F.3d at 1272. This position is supported by
the leading treatise. 24 Charles Alan Wright & Kenneth
W. Graham, Jr., Federal Practice and Procedure § 5475, at
125-27. Furthermore, the pedigree of the privilege
recognized in Swidler was far more impressive than the
governmental privilege for which Ryan argues here.
Swidler focused on whether the privilege survived the
death of the individual client, a proposition that the
common law had assumed for over a century. Swidler, 524
U.S. at 404, citin g Russell v. Jackson, 68 Eng. Rep. 558
(V.C. 1851). The government attorney-client privilege has
no such deep historical roots. We therefore reject Ryan’s
contention that Swidler compels us to find an absolute
privilege in the criminal context just because we
acknowledge a government attorney-client privilege in the
civil context. Even the dissenting judges in the Clinton
cases were unwilling to go so far as this. Lindsey, 158 F.3d
at 1283 (Tatel, J., dissenting) (“[G]overnment lawyers
working in executive departments and agencies enjoy a
6 No. 01-3386
reduced privilege in the face of grand jury subpoenas”);
Duces Tecum, 112 F.3d at 935-38 (Kopf, J., dissenting)
(finding that in criminal context government could
overcome privilege through procedural protections and
specific showing of need). Compare Branzburg v. Hayes,
408 U.S. 665 (1972) (no First Amendment-based reporter’s
privilege to refuse to testify before grand jury). Our
decision here instead must rest on whether the policy
reasons for recognizing an attorney-client privilege in
other contexts apply equally when the United States seeks
information from a government lawyer.
Ryan argues that they do. His main contention is that
the attorney-client privilege has been created “to
encourage full and frank communication between
attorneys and their clients and thereby promote broader
public interests in the observance of law and the
administration of justice.” Upjohn, 449 U.S. at 389. If
government officials know that conversations with
attorneys in their offices are not privileged, they will
avoid the candid discussion of sensitive legal matters.
Lindsey, 158 F.3d at 1286-87 (Tatel, J., dissenting). This
could lead to more legal violations and corruption in
public office. Duces Tecum, 112 F.3d at 930-32 (Kopf, J.,
dissenting). Alternatively, uninformed public officials
afraid to obtain legal advice will be unable effectively to
carry out their policy objectives, hampering the
implementation of government programs. Id. at 932.
Indeed, absent a privilege, citizens might be unwilling to
serve in public office at all.
While we recognize the need for full and frank
communication between government officials, we are more
persuaded by the serious arguments against extending the
attorney-client privilege to protect communications
between government lawyers and the public officials they
serve when criminal proceedings are at issue. First,
government lawyers have responsibilities and obligations
different from those facing members of the private bar.
While the latter are appropriately concerned first and
No. 01-3386 7
foremost with protecting their clients – even those
engaged in wrongdoing – from criminal charges and public
exposure, government lawyers have a higher, competing
duty to act in the public interest. Lindsey, 158 F.3d at
1273; Comment to ABA Model Rule 1.13 (noting that
government lawyers may have higher duty to rectify
wrongful official acts despite general rule of
confidentiality). They take an oath, separate from their
bar oath, to uphold the United States Constitution and the
laws of this nation (and usually the laws of the state they
serve when, as was the case with Bickel, they are state
employees). Their compensation comes not from a client
whose interests they are sworn to protect from the power
of the state, but from the state itself and the public fisc.**
It would be both unseemly and a misuse of public assets to
permit a public official to use a taxpayer-provided
attorney to conceal from the taxpayers themselves
otherwise admissible evidence of financial wrongdoing,
official misconduct, or abuse of power. Compare Nixon, 418
U.S. at 713 (qualified executive privilege applies in the
face of a criminal investigation). Therefore, when another
government lawyer requires information as part of a
criminal investigation, the public lawyer is obligated not
to protect his governmental client but to ensure its
compliance with the law.
This discussion necessarily points out another crucial
difference between a government lawyer’s clients and the
**
Of course, a state may provide an officeholder
with an individual taxpayer-provided attorney to
represent her in, for example, a Bivens action or an
independent counsel investigation and could perhaps even
specify by statute that the first duty of an agency’s general
counsel ran always to the head of the agency as individual
rather than officer. Here, however, there is no indication
that Illinois has abrogated the traditional understanding
that an organizational attorney’s client is the organization.
8 No. 01-3386
clients of other lawyers. Individuals and corporations are
both subject to criminal liability for their transgressions.
Individuals will not talk and corporations will have no
incentive to conduct or cooperate in internal
investigations if they know that any information disclosed
may be turned over to authorities. Swidler, 524 U.S. at
407. A state agency, however, cannot be held criminally
liable by either the state itself or the federal government.
See United States v. Price, 383 U.S. 787, 810 (1967). There
is thus no need to offer the attorney-client privilege as an
incentive to increase compliance with the laws. True,
individual state employees can be held liable, and many
have been found guilty of crimes in this very investigation.
But the privilege with which we are concerned today runs
to the office, not to the employees in that office. See Ill.
Sup. Ct. R. 1.13 (2001) (making clear that an organizational
lawyer’s duty is to the organization, not the organization’s
individual officers). Just as a corporate attorney has no
right or obligation to keep otherwise confidential
information from shareholders, Garner v. Wolfinbarger,
430 F.2d 1093, 1101 (5th Cir. 1970), so a government
attorney should have no privilege to shield relevant
information from the public citizens to whom she owes
ultimate allegiance, as represented by the grand jury.
Branzburg, 408 U.S. at 688 (noting grand jury’s
presumptive “right to every man’s evidence”).
In formulating privileges, this court cannot ignore the
interests and responsibilities of the coordinate entities
within our federal system, all of which are sworn to
uphold the public interest and committed to the “general
duty of public service.” Duces Tecum, 112 F.3d at 920.
Public officials are not the same as private citizens
precisely because they exercise the power of the state.
With this responsibility comes also the responsibility to
act in the public interest. It follows that interpersonal
relationships between an attorney for the state and a
government official acting in an official capacity must be
subordinated to the public interest in good and open
No. 01-3386 9
government, leaving the government lawyer duty-bound to
report internal criminal violations, not to shield them
from public exposure. Nixon, 418 U.S. at 712-13
(recognizing executive interest in confidentiality may be
lessened in face of criminal investigation); Lindsey, 158
F.3d at 1273 (noting public interest in “transparent and
accountable government”).
In the final analysis, reason and experience dictate that
the lack of criminal liability for government agencies and
the duty of public lawyers to uphold the law and foster an
open and accountable government outweigh any need for
a privilege in this context. An officeholder wary of
becoming enmeshed in illegal acts may always consult
with a private attorney, and there the privilege
unquestionably would apply. While Ryan fears that our
refusal to recognize a privilege will cause even the most
trivial of matters to be taken to outside counsel, this
strikes us as unduly alarmist. In fact, analogous rules
apply in th e corporate realm, where attorneys are
repeatedly admonished to advise corporate officials that
they are not personal clients of the attorney and may wish
to retain other counsel. These rules do not appear to have
stifled corporate discussion or proved impossible to
administer, and we see no reason why a similar result
cannot be countenanced here.
Ryan makes one final argument in favor of his assertion
of a governmental privilege: in a word, federalism. He
notes that the two leading cases in this area involved the
assertion of a privilege by a lawyer for the federal
government, vis à vis a federal investigation. From this, he
argues that even if federal attorneys lack an attorney-
client privilege in criminal proceedings, state-employed
attorneys should receive one. See Grand Jury Subpoena,
886 F.2d at 138 (implicitly finding that attorney for Detroit
City Council could assert privilege); Duces Tecum, 112
F.3d at 917 (noting in dicta that assertion by a state
attorney “implicates potentially serious federalism
concerns”).
10 No. 01-3386
Although we recognize the importance of federalism in
general, we do not see its relevance to the present
situation. Neither of the cases on which Ryan relies
offered a square holding that an attorney-client privilege
exists between state government lawyers and their state
clients that can override the interests of a federal grand
jury. The Eighth Circuit’s assertion is dicta, and the Sixth
Circuit never analyzed the unique features of a
government-attorney-client privilege, as it was focused
almost entirely on the question whether the attorney’s
advice in that case was even confidential under state law.
Grand Jury Subpoena, 886 F.2d at 138-39. Now that the
question is before us, we can see no reason why state
government lawyers are so different from federal
government lawyers that a different result is justified.
Although the Supreme Court has recognized important
Eleventh Amendment limitations on the ability of private
parties to bring suits against the states, it has made clear
that the United States may still sue a state to enforce the
nation’s laws. Alden v. Maine, 527 U.S. 706, 755 (1999);
Monaco v. Mississippi, 292 U.S. 313, 329 (1934). This
structural fact about our federal system implies that state
officials, including state lawyers, likewise enjoy no
immunity from disclosing relevant information to a federal
grand jury. See In re Special April 1977 Grand Jury, 581
F.2d 589, 592 (7th Cir. 1978).
Finally, we note that the federal courts have never
afforded an evidentiary privilege to the states that is not
also afforded to the federal government. In fact, the most
pertinent case from the Supreme Court cuts the other
way. In United States v. Gillock, 445 U.S. 360, 370-73 (1980),
the Court refused to acknowledge a privilege in a criminal
proceeding for statements made by a state senator, even
though similar statements would have been privileged
under the Speech or Debate Clause, U.S. Const. Art. I, § 6,
cl. 1, if they had been made by a federal legislator. The
Court rejected the idea that either separation of powers or
comity required the judiciary to create a privilege in favor
No. 01-3386 11
of state governments. Instead, “where important federal
interests are at stake, as in the enforcement of federal
criminal statutes, comity yields.” Id. at 373. Thus, a state
privilege should not be recognized if it will impair
legitimate federal interests and provide “only speculative
benefit” to a state official. Id. Having already determined
that the policy reasons behind the attorney-client
privilege do not justify its extension to government
attorneys in the context of criminal investigations, we
decline the invitation to make any distinction between
state and federal attorneys for ill-defined reasons of
federalism.
III
The district court also determined that the current
Secretary of State, Secretary White, was the holder of his
Office’s attorney-client privilege and had the power to
waive that privilege as to conversations occurring before
he took office. In light of our holding that none of the
conversations between Bickel and Ryan made in their
official capacities as General Counsel and Secretary of
State are privileged in the face of a federal grand jury
subpoena, we express no opinion on this determination.
The judgment of the district court is AFFIRMED.