Government regulation, Work product privilege (Law) -- Laws, regulations and rules, Disclosure (Taxation) -- Laws, regulations and rules, Self-incrimination -- Laws, regulations and rules, Summons -- Laws, regulations and rules, Summons -- Remedies, Confidential communications -- Attorneys, Confidential communications -- Laws, regulations and rules, and United States v. Greenfield (831 F.3d 106 (2d Cir. 2016))
Table of Contents I. Introduction 337 II. The Greenfield Decision 342 III. Despite Greenfields Robust Application of the Fifth Amendment, 354 the Case Regrettably Does Nothing to Undercut Eight Circuit [...]
In 1976, in Fisher v. United States, the Supreme Court first recognized the 'act of production privilege' as being a necessary component of the Fifth Amendment's privilege against self-incrimination. A grand jury subpoena or Service summons does not violate the Fifth Amendment just because documents the government seeks are incriminating; pre-existing documents are not the result of government compulsion. But, a taxpayer may refuse to produce those same documents if the compelled act of producing them is testimonial and incriminating. By producing documents, a taxpayer may 'testify' that the documents exist, that she possesses and controls them, that she believes that they are described in the subpoena or summons, and that they are authentic--all admissions that may be incriminating. The act of production privilege does not apply, however, if factual admissions inherent in producing documents are a 'foregone conclusion' (i.e., if the government can independently prove those facts without relying on the documents' production). In 2016, in United States v. Greenfield, the Second Circuit narrowly drew this foregone conclusion exception. Greenfield asserted his act of production privilege in response to a 2013 Service summons seeking records of foreign bank accounts. Evidence in the government's hands indicated that Greenfield might have controlled the accounts in 2001. But the court held that the 'critical issue' was whether the government could prove that facts which would be conveyed by Greenfield's act of producing documents were a foregone conclusion in 2013. The government could not meet this burden (although it might have done so in 2001). The court therefore applied the act of production privilege to quash the summons, because the existence and Greenfield's control of the summonsed documents in 2013 could be incriminating. 'One of Greenfield's strongest defenses to a charge of tax evasion would be to argue that his father [who died in 2009]... was the sole person with knowledge of how the family's finances were organized,' a defense which would be undermined by evidence that Greenfield took control of bank records after his father's death. Greenfield seems to be a robust affirmation of the Fifth Amendment's act of production privilege. Yet the Greenfield court was careful to distinguish its 2013 decision in In re Grand Jury Subpoena Dated Feb. 2, 2012, where it refused to apply the act of production privilege to a grand jury subpoena that sought a taxpayer's foreign bank account records, but only from the previous five years. In the earlier case, the Second Circuit applied the so-called 'required records exception' to the Fifth Amendment privilege, because a regulation under the Bank Secrecy Act (BSA), 31 C.F.R. [section] 1010.420, requires taxpayers sometimes even to create, and to retain for five years, records of foreign bank accounts. The Greenfield decision stated: 'The Government can require an individual to produce documents related to foreign bank accounts maintained pursuant to... 31 C.F.R. [section] 1010.420, without violating an individual's right against self-incrimination under the Fifth Amendment.' Consequently, the difference between Greenfield and In re Grand Jury Subpoena Dated Feb. 2, 2012 is not the result of meticulous constitutional analysis, but rests only on the length of time that an agency regulation requires foreign bank account records to be maintained. If the BSA regulation required taxpayers to maintain foreign bank account records for, say, 12 years, presumably the Greenfield court would not have engaged in its extensive discussion of the Fifth Amendment, but would simply have ordered Greenfield to respond to the summons. Greenfield thus, by its own terms, applies only if no statute or regulation requires a taxpayer to maintain records that the government seeks. Greenfield does nothing to mitigate the potentially far-reaching and troubling fallout from decisions of eight of the 12 federal circuit courts, dating from 2011 through 2016, all of which applied the so-called 'required records exception' to the Fifth Amendment. This 'exception' dates from the Supreme Court's 1948 decision in Shapiro v. United States, a case that involved emergency wartime recordkeeping regulations governing a publicly conducted business. Nevertheless, the eight circuit court cases all relied on Shapiro to hold that a taxpayer may not assert her Fifth Amendment act of production privilege (first recognized three decades after Shapiro) to refuse to produce records from the past five years in connection with the private act of owning a foreign bank account, no matter how testimonial and incriminating the taxpayer's act of producing those records may be. The eight circuit court decisions espoused the dubious notion that whether the Fifth Amendment act of production privilege applies depends on whether there is a statute or even a regulation that requires taxpayers to maintain for a specified period records that the government seeks via subpoena or summons. As a result, Congress, or even a federal agency, can 'override' the Constitution's protection against compelled self-incrimination simply by prescribing recordkeeping requirements. This surely cannot be correct constitutional law; these decisions contravene the bedrock propositions that a statute (let alone a regulation) cannot override the Constitution, and that, when the prerequisites of compulsion, testimony, and possible self-incrimination are met, the Fifth Amendment's privilege is 'unequivocal and without exception.'