In In Re Twelve Grand Jury Subpeonas, --- F.3d ---, No. 17-17213 (9th Cir. 2018), the Court affirmed the district court’s order holding an appellant in contempt for his failure to comply with the court’s order to respond to twelve grand jury subpoenas in his capacity as a records custodian.
The case involves the tension between the obligation for a corporate entity to comply with a subpoena and the Fifth Amendment privilege against self-incrimination.
The defendant argued that, because the companies were small, closely-held entities for which he was either the sole shareholder or sole employee, or was solely responsible for accounting and recordkeeping, he could invoke his Fifth Amendment privilege. The theory was that, because the jury would know the defendant provided the documents, it implicated the act of production doctrine.
The act of production doctrine recognizes “that the act of producing documents in response to a subpoena may have a compelled testimonial aspect,” in that the act “may implicitly communicate ‘statements of fact,’” such as “that the papers existed, were in [the producer’s] possession or control, and were authentic.”
Additionally, under the collective entity doctrine, individuals and sole proprietorships, which do not, as a legal matter, exist separately from the individuals who comprise them, there is a privilege against complying with subpoenas that implicate Fifth Amendment grounds.
The Court rejected the defendant's claims. It held there were no circumstances under which a records custodian could resist a subpoena for a collective entity’s records on Fifth Amendment grounds, and that the size of the entity, and the extent to which a jury would assume that the individual seeking to assert the privilege produced the documents, were not relevant.
