In Re Grand Jury Matter. Appeal of James Gilbert Brown , 768 F.2d 525 ( 1985 )

OPINION OF THE COURT

GIBBONS, Circuit Judge:

James Gilbert Brown appeals from an order adjudging him to be in civil contempt of court for refusing to obey an order enforcing a subpoena duces tecum. The subpoena duces tecum sought the production, before a grand jury, of corporate records of J. Gilbert Brown Co., P.C. In resisting the enforcement of the subpoena duces tecum, Brown asserted that his authenticating testimony with respect to those records would violate his privilege against self-incrimination. The district court held that because the records belonged to a corporation, Brown had no privilege against self-incrimination, either with respect to the contents of the records, or with respect to their authentication before the grand jury. On appeal Brown does not contend that his privilege against self-incrimination applies to the contents of the records. He contends, rather, that having made a non-frivolous claim that authentication of the records would incriminate him, he could not be held in contempt absent findings by the district court that the fact of his possession of the records was not of evidentiary significance, and that his production of them would not be used for evidentiary purposes. We agree, and thus we reverse.

The issue presented by this appeal is a narrow one. We must decide whether a person, simply by virtue of his status as a custodian of a corporation’s records, can be compelled to make self-incriminating disclosures that are testimonial, i.e., communicative or assertive in nature. The subpoena duces tecum addressed to Brown seeks the records of J. Gilbert Brown Co., P.C., an incorporated accounting firm wholly owned by Brown. Brown makes no claim that because he is the sole owner of this professional corporation, it or he can claim any privilege against self-incrimination with respect to the contents of the records. The government acknowledges that the grand jury could obtain the records by means other than a subpoena duces tecum addressed to Brown. Thus, what is in issue is solely the question whether Brown may be compelled by a subpoena to give testimony before the grand jury, verbally or by a non-verbal communicative act, authenticating those records. The government urges (1) that he may be so compelled, and (2) that if such compelled authentication testimony is elicited before the grand jury, it may be used against Brown, to the extent relevant, in the trial of any indictment which might be returned against him. See Fed.R.Evid. 801(d). The district court agreed with the government, and held Brown in contempt for refusing to give authentication testimony even though he is concededly a target of the grand jury investigation, and even though he had offered to submit the records to the grand jury through his attorney.¹ The possibility that the authentication testimony might tend to incriminate Brown was, in the trial court’s view, irrelevant.

In United States v. Austin-Bagley Corp., 31 F.2d 229, 233-34 (2d Cir.), cert. denied, 279 U.S. 863, 49 S.Ct. 479, 73 L.Ed. 1002 (1929) the Court of Appeals for the Second Circuit held that communicative or assertive testimony with respect to corporate records could be compelled, even though it resulted in self-incrimination. The Austin-Bagley exception to the privilege against self-incrimination has never been adopted by this court or the Supreme Court. Such an exception is, moreover, inconsistent with the Supreme Court’s recent treatment of the privilege.

The Supreme Court’s modern treatment of the privilege against self-incrimination commences with Justice Brennan’s opinion in Schmerber v. California, 384 U.S. 757, 761, 86 S.Ct. 1826, 1830, 16 L.Ed.2d 908 (1966), in which, in contrast with earlier cases such as Boyd v. United States, 116 U.S. 616, 6 S.Ct. 524, 29 L.Ed. 746 (1886), the Court focused upon the distinction between evidence of acts which are noncommunicative, and evidence of acts which, by their nature, require the direct manifestations of an individual’s thoughts. Schmerber v. California recognized that compelled production of blood samples did not require disclosure of the mental process of the person from whom the sample was, taken. Schmerber, 384 U.S. at 765, 86 S.Ct. at 1832. The Court has applied the same principle to permit a defendant’s compelled participation in a lineup, United States v. Wade, 388 U.S. 218, 221-23, 87 S.Ct. 1926, 1929-30, 18 L.Ed.2d 1149 (1967), and the compelled production of handwriting samples, Gilbert v. California, 388 U.S. 263, 265-67, 87 S.Ct. 1951, 1952-53, 18 L.Ed.2d 1178 (1967), and voice exemplars, United States v. Dionisio, 410 U.S. 1, 5-7, 93 S.Ct. 764, 767-68, 35 L.Ed.2d 67 (1973). In each case the Court noted that the evidence obtained was devoid of testimonial significance. Once the Court recognized that the privilege against self-incrimination was concerned only with the compelled disclosure of thought processes, it was inevitable that earlier holdings such as Boyd v. United States, supra, 116 U.S. 616, 6 S.Ct. at 524, applying the privilege to the contents of records which were voluntarily created, would be reconsidered. That reconsideration occurred in Fisher v. United States, 425 U.S. 391, 96 S.Ct. 1569, 48 L.Ed.2d 39 (1976), holding that the compelled production from attorneys of documents which had been prepared either by their clients or for their clients by accountants did not implicate the clients’ privilege against self-incrimination. As the Court explained,

[T]he Fifth Amendment does not independently proscribe the compelled production of every sort of incriminating evidence but applies only when the accused is compelled to make a testimonial communication that is incriminating.

Id. at 408, 96 S.Ct. at 1579 (emphasis in original).

Although Fisher v. United States put an end to the successful assertion of the privilege against self-incrimination with respect to the contents of business documents voluntarily created, the quoted passage makes clear that the Court continued to recognize that testimonial communication of any kind was protected if it might tend to incriminate. Indeed, long before the Court cut back on the privacy interests in the contents of records which it recognized in Boyd, it had determined that custodians of business records were protected from compelled incriminating testimony. In Curcio v. United States, 354 U.S. 118, 77 S.Ct. 1145, 1 L.Ed.2d 1225 (1957), the government, relying on United States v. White, 322 U.S. 694, 64 S.Ct. 1248, 88 L.Ed. 1542 (1944), urged that the custodian of a labor union’s books and records could be compelled to testify before a grand jury about their location. A unanimous Court flatly rejected that contention, reasoning:

The Fifth Amendment suggests no such exception. It guarantees that “No person ... shall be compelled in any criminal case to be a witness against himself ____” A custodian, by assuming the duties of his office, undertakes the obligation to produce the books of which he is custodian in response to a rightful exercise of the State’s visitorial powers. But he cannot lawfully be compelled, in the absence of a grant of adequate immunity from prosecution, to condemn himself by his own oral testimony.

Curcio, 354 U.S. at 123-24, 77 S.Ct. at 1149. Justice Burton’s opinion in Curcio v. United States distinguishes the Second Circuit opinion in United States v. Austin-Bagley Corp., supra, and contains dicta to the effect that mere authentication testimony may be compelled. 354 U.S. at 125, 77 S.Ct. at 1150. That dicta, however, is inconsistent with the reasoning and holding of Curdo, for Justice Burton holds unequivocally that “forcing the custodian to testify orally as to the whereabouts of non-produced records requires him to disclose the contents of his own mind.” Id. at 128, 77 S.Ct. at 1151. By focusing on the fact that the testimony for which compulsion was sought would require a custodian of records to reveal the contents of his mind, Curdo anticipated the reasoning of the Schmerber line of cases. The dicta in Cur-do arguably approving the Austin-Bagley rule simply cannot be squared with such a focus of inquiry, and furthermore, are inconsistent with the Court’s reasoning in Fisher and in the more recent case of United States v. Doe, 465 U.S. 605, 104 S.Ct. 1237, 79 L.Ed.2d 552 (1984).

In Fisher the Court specifically referred to the communicative nature of production:

The act of producing evidence in response to a subpoena nevertheless has communicative aspects of its own, wholly aside from the contents of the papers produced. Compliance with the subpoena tacitly concedes the existence of the papers demanded and their possession or control by the taxpayer. It also would indicate the taxpayer’s belief that the papers are those described in the subpoena. Curcio v. United States, 354 U.S. 118, 125 [77 S.Ct. 1145, 1150, 1 L.Ed.2d 1225] (1957).

425 U.S. at 410, 96 S.Ct. at 1581. Thus in Fisher the Court cited with approval the holding in Curdo that a record custodian could not be compelled to give evidence of a communicative nature which might incriminate him. The Court went on to examine the papers in issue, prepared by someone other than the custodian, and determined that as a matter of law admitting the existence and possession of the papers would not tend to incriminate. 425 U.S. at 411, 96 S.Ct. at 1581. The Fisher Court, therefore, did what the trial court in this case refused to do, and what the AustinBagley Court held to be irrelevant. It made a determination that the production of the requested evidence would not tend to incriminate the subpoenaed witness.

More recently, in United States v. Doe, 465 U.S. —, 104 S.Ct. 1237, 79 L.Ed.2d 552 (1984), that critical determination was made, in the first instance, by the district court which found that the act of producing the subpoenaed documents would be communicative and incriminatory. The Supreme Court affirmed the holding of this court that the production of the documents in question was privileged, and could not be compelled absent a grant of use- immunity pursuant to 18 U.S.C. §§ 6002 and 6003. Doe, 465 U.S. at —, 104 S.Ct. at 1245. The Court stated that

[although the contents of a document may not be privileged, the act of producing the document may be. [.Fisher v. United States, supra ] at 410, 96 S.Ct. at 1581. A government subpoena compels the holder of the document to perform an act that may have testimonial aspects and an incriminating effect.

Id. at-, 104 S.Ct. at 1242.

The government urges that the holding in United States v. Doe does not control because in Doe the records were those of a sole proprietorship, while in this case they belong to a professional corporation. That argument misses the whole point of the Court’s analysis in Fisher and Doe.² Those cases, consistent with Schmerber v. California, make the significant factor, for the privilege against self-incrimination, neither the nature of the entity which owns documents, nor the contents of documents, but rather the communicative or noncommunicative nature of the arguably incriminating disclosures sought to be compelled.

Our holding that a witness may not be held in contempt for refusing to authenticate records absent either a finding that there is no likelihood of self-incrimination or a grant of use immunity casts no doubt on the continued vitality of the rules of Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652 (1906) and United States v. White, 322 U.S. 694, 64 S.Ct. 1248, 88 L.Ed. 1542 (1944), that neither corporations nor other collective entities may assert a privilege against self-incrimination. Nor does it weaken in the slightest the utility of the compulsory record rule discussed in Marchetti v. United States, 390 U.S. 39, 57, 88 S.Ct. 697, 707, 19 L.Ed.2d 889 (1968). Records of collective entities still must be maintained, and their production can be compelled by a subpoena duces tecum addressed to the entity. In situations where authentication is required,³ Fed.R.Evid. 901(a) indicates that the requirement can be satisfied by the submission of “sufficient evidence to support a finding that the matter in question is what its proponent claims.” Id. See Fed.R.Evid. 104(b). This is particularly true in the case of business records which, more often than not, can be authenticated without resort to extrinsic evidence. In re Japanese Electronic Products, 723 F.2d 238, 284, 288 (3d Cir.1983), cert. granted in part sub nom. Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corporation, — U.S. -, 105 S.Ct. 1863, 85 L.Ed.2d 157 (1985). Where a witness is required to authenticate records, most business entities will have agents who can provide the testimony without self-incrimination.⁴ The grant of use immunity pursuant to 18 U.S.C. §§ 6002 and 6003 is always a possibility. The dissent’s raising the spectre of two corporations avoiding prosecution for price fixing by virtue of a “de facto” corporate privilege is, thus, unrealistic in suggesting that the actual participants in a corporate conspiracy would be the only persons within the organization capable of authenticating the hypothetical document. Further, the dissent is notably silent on the possibility of the grant of use immunity in this scenario.

In the present case the government never explored alternate means of production or authentication of the documents, and it never considered the possibility of a grant of use immunity before moving to have Brown held in contempt. Indeed, it candidly concedes that what it wants amounts to compelled authentication testimony which may later be used against a target of the grand jury investigation. Such a result would be a convenience to prosecutors, but the Court rejected essentially the same argument for efficiency in prosecutions in Curcio v. United States, 354 U.S. at 127, 77 S.Ct. at 1151. We have no doubt that the repeal of the privilege against self-incrimination by a constitutional amendment would even be a greater convenience to prosecutors, but until that occurs prosecutors must live with the rule that no person, even the sole stockholder of a professional corporation, may be compelled to disclose the contents of his mind when such disclosure may tend to provide an incriminating link in an evidentiary chain for use against him.

Since the court gave Brown no opportunity to establish that production and authentication would tend to incriminate him, and no offer of statutory use immunity was made, the order holding Brown in civil contempt must be reversed. Whether the act of production, or testimony authenticating the records of J. Gilbert Brown Co., P.C., would in fact tend to incriminate Brown is a matter which must be determined by the trial court if the government makes a further effort to enforce the subpoena duces tecum.

The judgment appealed from will, therefore, be reversed.

1 . The dissent’s doubt, expressed in footnote 3, that such an offer was, in fact, made by Brown’s counsel is surprising in view of the statements made by the parties during oral argument before all the members of this court. In the course of his argument, Brown’s attorney represented that the proffer had been made and was refused. Later, in response to a direct question from the court, the government, through Mr. Welsh, confirmed that Brown had offered to produce the records through his counsel, and that the offer had been rejected.

2 . The government places great reliance on Bellis v. United States, 417 U.S. 85, 94 S.Ct. 2179, 40 L.Ed.2d 678 (1974), but Bellis stands only for the proposition that the custodian of a collective entity’s documents has no fifth amendment privilege with respect to the incriminating contents of those documents. Bellis did not urge, and the Court did not consider, the often communicative and incriminatory nature of the act of production. See Brief for Petitioner, Bellis v. United States, 417 U.S. 85, 94 S.Ct. 2179, 40 L.Ed.2d 678 (1974). Thus, the holdings in Fisher and Doe render untenable any suggestion that Beilis would require a custodian to produce documents where the act of production is both communicative and incriminatory.

3 . A grand jury proceeding is, of course, not such a situation, since the Federal Rules of Evidence do not apply. Fed.R.Evid. 1101(d)(2). See Costello v. United States, 350 U.S. 359, 76 S.Ct. 406, 100 L.Ed. 397 (1965).

4 . The government did not in this case request the court to direct that the corporation appoint such an agent. See Rogers Transp. Inc. v. Stern, 763 F.2d 165 (3d Cir.1985) (en banc).