Friday, January 4, 2019

Ninth Circuit Rejects Spousal Testimonial Privilege for Foreign Bank Records (1/4/18)

In In re Grand Jury Subpoena, Dated March 21, 2018 (9th Cir. 12/28/18) (unpublished), here, the Court affirmed a district court order of contempt for compelling the wife of a grand jury target to produce records of her foreign bank activity for the years 2011 through 2016.  She asserted that the spousal testimonial privilege protects her from compelled production of the documents.  The district court rejected her claim of spousal testimonial privilege and held her in contempt for her continuing refusal to produce.  The Ninth Circuit held that the spousal testimonial privilege was not applicable.

The Ninth Circuit's analysis is contained in one paragraph with one footnote, so I just cut and paste them.
Doe asserts that the spousal testimonial privilege protects her from producing documents responsive to the subpoena because the grand jury is currently investigating possible federal tax crimes committed by her husband. n1  For the spousal testimonial privilege to apply, “the anticipated testimony ‘[must] in fact be adverse’ to the nonwitness spouse.” United States v. Van Cauwenberghe, 827 F.2d 424, 431 (9th Cir. 1987) (citation omitted); see also United States v. Fomichev, 899 F.3d 766, 771 (9th Cir. 2018) (“[T]he witness-spouse alone has a privilege to refuse to testify adversely.”) (emphasis added) (citation omitted). Here, “the testimonial aspect of [Doe’s] response to a subpoena duces tecum does nothing more than establish the existence, authenticity, and custody” of any responsive foreign bank account records. United States v. Hubbell, 530 U.S. 27, 40–41 (2000). Because this bare testimonial aspect of Doe’s act of production does not itself adversely affect her husband’s case, Doe is not relieved of her obligation to produce foreign bank account records over which she has care, custody, or control.
   n1 Although Doe also raised claims of privilege under the Fifth Amendment, and the marital communications privilege, before the district court, these arguments were not raised on appeal and are therefore waived. Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir. 1999) (“[O]n appeal, arguments not raised by a party in its opening brief are deemed waived.”). 
JAT Comments:

By way of background, there are two spousal or marital privileges arising from marriage and society's concern about insuring marital accord.  They are:

1.  Spousal communication privilege.  This privilege may be asserted by a witness spouse in a criminal investigation or case in which the nonwitness spouse is a potential target or defendant to avoid being compelled to testify as to their confidential spousal communications.  Either spouse may assert this privilege.  This privilege did not apply in In re Grand Jury Subpoena.

2.  Spousal testimonial privilege.  This privilege may be asserted by a witness spouse in a criminal investigation or case in which the nonwitness spouse is a potential target or defendant from being compelled to testify adversely to the nontestifying spouse.  If the testifying spouse does not invoke this privilege, the testifying spouse can be compelled to testify, even over the objection of the nontestifying spouse (the potential target or defendant).

In In re Grand Jury, the wife invoked the spousal testimonial privilege (among others not relevant to the case as presented on appeal).  Since Government sought only documents via compulsory process (the grand jury subpoena), the witness' only "testimony" would have been the testimony inherent in the act of production.  The act of production doctrine was developed in the Fifth Amendment context and holds that the act of production can be testimonial as to testimony inherent in the act of production -- the existence, authenticity and custody (or control) over the document(s).  The Court made a limited holding that, in the case as it is now, that testimony is not per se adverse to the nontestifying spouse, so the privilege did not apply.

The finer issue might be reached if, at the criminal trial, the Government has no other way of authenticating the documents (or showing chain of custody) except through the act of production testimony of the witness spouse or even by calling the witness spouse to the stand to authenticate (or show chain of custody).  Then, the testimony might be adverse and might be subject to the privilege.  I have not independently researched that issue.  But, I think the Fifth Amendment nuance on the act of production doctrine may offer some play in the joints between robust application of the Fifth Amendment (privilege applies) and the practical reality of pursuing criminal cases.  That analysis might play out in a criminal trial with respect to the spousal testimonial privilege as to acts of production.

Of course, in any criminal trial, the Government will have to authenticate the documents as being bank records.  I am not sure that the Government can do that through the spouse or this act of production testimony because it is testimony and, at that point, would be adverse testimony if the contents of the documents are incriminating.  Maybe the Government will have to make the predicate showings for use as evidence in some other way.


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