Expedited appeal from orders of the United States District Court for the Southern District of New York (Vincent L. Broderick, Judge) holding appellants in civil contempt for refusing to sign directives authorizing foreign financial institutions to disclose information and deliver documents to the Government, and ordering them confined. Judge Newman concurs in a separate opinion.
Newman, Miner and Altimari, Circuit Judges. Jon O. Newman, Circuit Judge, concurring.
Appellants, two witnesses before the grand jury, appeal from orders of the United States District Court for the Southern District of New York (Vincent L. Broderick, Judge), which held them in civil contempt for refusing to sign directives authorizing foreign financial institutions to release documents and information to the government, and ordered them confined until they signed the directives. 28 U.S.C. § 1826(a). Appellants contend inter alia that compelled execution of the directives, as written, would violate their fifth amendment privilege against self-incrimination and right to due process of law. Because we find no fifth amendment violation here, we affirm.
On May 28 and 29, 1987, the grand jury issued subpoenas duces tecum to appellants which required them to sign "consent directives" which were attached to the subpoenas. The directives provided that the signator, i.e., both appellants, authorized foreign financial institutions to disclose to the government information and documents relating to accounts maintained by appellants, or their corporations, at the foreign financial institutions. The directives did not acknowledge that accounts in foreign financial institutions were in existence or that they were controlled by appellants. Nor did the directives indicate whether documents or any other information relating to appellants were present at foreign financial institutions, assuming that such accounts did exist.
The directives provided that they should be "construed as consent" with respect "to any and all bank confidentiality laws of any state or nation." In addition, and apparently to make it clear that, although the directives were to be construed as consent, they nevertheless were being compelled by the grand jury, the directives provided that they were executed "in compliance with the direction of a Grand Jury Subpoena Duces Tecum."
On June 8, 1987, appellants filed motions to quash the subpoenas, arguing inter alia that compelled execution of the directives would violate their fifth amendment rights. After a hearing on June 15, 1987, the district court denied their motions to quash after it found that execution of the directives by appellants would not involve testimonial communications, and thus created no basis for fifth amendment violations. The district court then ordered appellants to appear before the grand jury to sign the directives.
In light of appellants' objections to some of the language contained in the directives, however, the district court modified them by changing the title from "Consent Directive" to "Directive," and specifying that they were being executed in compliance with a court order, rather than in compliance with the direction of a grand jury subpoena. The district court also provided that the directives could not be used as an admission against appellants in any subsequent trial, and it inserted a time limitation in the directives so that, as modified, they authorized disclosure of information and records dating back to 1980.
On June 22, 1987, appellants appeared before the grand jury and refused to sign the directives as modified by the district court, despite being ordered to do so by the grand jury foreman. On the same day, and after a hearing, the district court found appellants in civil contempt, and ordered them incarcerated until such time as they executed the modified directives. 28 U.S.C. § 1826(a). At the hearing, the district court again stated that it found no testimonial communications implicated by the execution of the directives, and noted that if appellants had executed the directives, the government would have been barred from using them as an admission in any subsequent trial. The district court stated that it did not feel its order excluding the admission of the directives into evidence was required by the fifth amendment, but was in response to Second Circuit precedent which provided for such exclusion.
The district court then denied appellants' motion for a stay or bail pending appeal of the contempt and confinement orders, but granted them a limited stay to apply to this court for a stay pending appeal. On June 25, 1987, we continued the stay of confinement until the matter could be heard on an expedited basis, and at oral argument on July 14, 1987, we continued the stay until disposition of this appeal. For the reasons stated below, we affirm the district court orders holding appellants in contempt, and accordingly, lift the stay of execution of the confinement orders.
In this expedited appeal, appellants present several challenges to the district court orders requiring them to sign the directives at issue. Appellants assert, first, that the orders violated their fifth amendment privilege against compelled self-incrimination; and second, that absent language in the directives indicating that appellants signed them under protest and under threat of confinement, they were being compelled to sign false documents. Appellants also raised other challenges which we find are without merit, and thus we summarily reject them.
With respect to the self-incrimination claim, appellants recognize that precedent in this Circuit has approved of the compelled execution of directives in the face of fifth amendment challenges, In Re F.D.N.Y. Grand Jury Subpoena, 811 F.2d 114 (2d Cir. 1987), and United States v. Davis, 767 F.2d 1025 (2d Cir. 1985), but contend that those cases conflict with the Supreme Court's decision in United States v. Doe, 465 U.S. 605, 79 L. Ed. 2d 552, 104 S. Ct. 1237 (1984), to the extent that they purportedly relied on a de facto use immunity to obviate any fifth amendment problems. Appellants thus invite us to reverse our prior decisions in light of this conflict, and hold that compelled execution of the ...