In re Special February 2011-1 Grand Jury Subpoena Dated September 12, 2011
691 F.3d 903
7th Cir.2012Background
- T.W. is target of IRS/DOJ investigation into offshore accounts to evade taxes.
- Grand jury issued a subpoena seeking Bank Secrecy Act records for Oct 2006–present.
- Records required to be kept under 31 C.F.R. § 103.32 / § 1010.420 are demanded.
- Producing records may incriminate T.W. if he lacks or misreports accounts.
- District court quashed the subpoena, ruling the Required Records Doctrine did not apply.
- Government argues the Required Records Doctrine applies, overriding the Fifth Amendment privilege.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Required Records Doctrine applies to compel production of Bank Secrecy Act records. | T.W. argues doctrine does not apply when production is testimonial and incriminating. | The Government argues the three Grosso criteria are met and doctrine overrides privilege. | Yes; doctrine applies and compulsion is allowed. |
| Whether the Bank Secrecy Act records satisfy Grosso’s three requirements. | Records are not inherently public and do not fit regulatory purposes. | Records meet regulatory purposes, are kept by regulated party, and have public-like aspects. | Yes; all three requirements are satisfied. |
| Whether the district court erred by not applying the Ninth Circuit’s reasoning in similar Bank Secrecy Act cases. | Cites Ninth Circuit in re M.H. finding no Fifth Amendment barrier. | Seventh Circuit applies Required Records Doctrine broadly; governing analysis differs. | Appellee’s subpoena must be complied with under the doctrine. |
Key Cases Cited
- Shapiro v. United States, 335 U.S. 1 (Supreme Court 1948) (established the origin of the Required Records Doctrine in regulatory records)
- Marchetti v. United States, 390 U.S. 39 (Supreme Court 1968) (rejected application of doctrine in certain contexts; clarified criteria)
- Grosso v. United States, 390 U.S. 62 (Supreme Court 1968) (three Grosso requirements for applicability)
- Fisher v. United States, 425 U.S. 391 (Supreme Court 1976) (recognition of act-of-production privilege)
- Doe v. United States (Doe I), 465 U.S. 605 (Supreme Court 1984) (production may be testimonial)
- Doe v. United States (Doe II), 487 U.S. 201 (Supreme Court 1988) (production may have testimonial aspects)
- Bouknight, 493 U.S. 549 (Supreme Court 1990) (production in regulatory regime may not be shielded)
- Lehman, 887 F.2d 1328 (7th Cir. 1989) (applied production privilege vs. required records)
- Smith v. Richert, 35 F.3d 300 (7th Cir. 1994) (recited Grosso framework and doctrinal history)
- Porter, 711 F.2d 1397 (7th Cir. 1983) (recognized act of production concerns under doctrine)
- In re Grand Jury Subpoena Duces Tecum Served Upon Underhill, 781 F.2d 64 (6th Cir. 1986) (application of doctrine to production)
- In re Grand Jury Subpoena, 21 F.3d 226 (8th Cir. 1994) (application to production)
- Commodity Futures Trading Comm v. Collins, 997 F.2d 1230 (7th Cir. 1993) (notes doctrine’s scope)
- In re M.H., 648 F.3d 1067 (9th Cir. 2011) (Ninth Circuit held BSA records fall within doctrine)