Another Required Records Case; Another Government Win (12/11/12).

We have another required records case and the Government continues its trend of winning these cases.  In re Grand Jury Subpoena Dated February 2, 2012, 908 F. Supp. 2d 348 (ED NY 12/10/12), Bianco, J.  There is nothing particularly exceptional about the case except perhaps two makeweight predicate taxpayer (in this context, "witness") arguments before reaching the required records issue.

First, the witness argued that the summons should not be enforced because the Government already has copies of the documents it seeks from the witness.  The Court rejects this argument as follows:

[R]espondent's argument that the government already possesses the information requested by the Subpoena is based upon sheer speculation and is denied by the government. (See Gov't Reply Mem. of Law at 2) ("The respondent's argument begins with the false premise that the government already possesses the records sought by the Subpoena."); (id.) ("The respondent . . . has no basis for his contention that the government 'already possesses the documents sought by the subpoena.'" (quoting Resp't's Mem. of Law in Opp'n at 3)). Although the government attached to its motion to compel a selection of documents from one foreign bank account with dates spanning from 1992 to August 2008, those documents are hardly (on their face) co-extensive with the scope of the Subpoena. Specifically, the Subpoena required the production of documents for a five-year period prior to February 2012. Thus, the government's selection does not contain any documents for the majority of the five-year period covered by the Subpoena. Moreover, there are no documents from other foreign banks at which the respondent, unbeknownst to the government, may have had accounts. In other words, it is self-evident that the government would have no way of ensuring that all such records from all foreign bank accounts — for which respondent has a financial interest, or is a signatory, or has authority over — have been uncovered unless respondent complies with the Subpoena. In short, there is no reason to believe that the government already possesses all documents sought by the Subpoena. Additionally, the fact that the government has some of respondent's foreign bank records clearly does not preclude it from seeking all such relevant foreign bank records. See, e.g., United States v. Dionisio, 410 U.S. 1, 13 (1973) ("The grand jury may well find it desirable to call numerous witnesses in the course of an investigation. It does not follow that each witness may resist a subpoena on the ground that too many witnesses have been called.").

Second, the witness argues that the summons should not be enforced because the Government is using the grand jury subpoena to prepare for trial.

This argument is a legal non-starter in the instant case because the grand jury has not returned an indictment. Stated differently, the concern that the government is abusing the grand jury by preparing for trial only arises after the grand jury has returned an indictment. See, e.g., United States v. Leung, 40 F.3d 577, 581 (2d Cir. 1994) ("It is, of course, improper for the Government to use the grand jury for the sole or dominant purpose of preparing for trial under a pending indictment." (emphasis added)); see also United States v. Ohle, 678 F. Supp. 2d 215, 233 (S.D.N.Y. 2010) (same); United States v. Bin Laden, 116 F. Supp. 2d 489 (S.D.N.Y. 2000) (citing cases). Here, there are no pending charges that have been returned by the grand jury; moreover, there is no trial. In short, no evidence supports the conclusion that the government has issued the Subpoena for the sole or dominant purpose of preparing for a trial, particularly when no charges have yet been brought. For this reason, respondent's argument does not provide a basis to deprive the government, and the grand jury, of these potentially relevant documents.

The Court then launches into the required records analysis, the results of which are predictable.  The Court does note that it had previously sustained the required records analysis in In re Grand Jury Subpoena Dated September 9, 2011, No. 2:11-mc-00747-JFB (E.D.N.Y. Dec. 30, 2011).  Apparently there was no appeal from that earlier holding.