United States v. R. Enterprises, Inc.

by Sandra Day O'Connor

United States Supreme Court

498 U.S. 292

United States  v.  R. Enterprises, Inc.

No. 89-1436  Argued: Oct. 29, 1990. --- Decided: Jan 22, 1991

Syllabus

Pursuant to an investigation into allegations of interstate transportation of obscene materials, a federal grand jury sitting in the Eastern District of Virginia issued subpoenas duces tecum to Model Magazine Distributors, Inc. (Model), and to respondents R. Enterprises, Inc., and MFR Court Street Books, Inc. (MFR), all of which were based in New York and wholly owned by the same person. The subpoenas sought a variety of corporate books and records and, in Model's case, copies of certain videotapes that it had shipped to retailers in the Eastern District. The District Court denied the companies' motions to quash the subpoenas and, when the companies refused to comply with the subpoenas, found each of them in contempt. The Court of Appeals, inter alia, quashed the subpoenas issued to respondents, ruling that the subpoenas did not satisfy the relevancy prong of the test set out in United States v. Nixon, 418 U.S. 683, 699-700, 94 S.Ct. 3090, 3103-3104, 41 L.Ed.2d 1039-which requires the Government to establish relevancy, admissibility, and specificity in order to enforce a subpoena in the trial context-and that the subpoenas therefore failed to meet the requirement that any document subpoenaed under Federal Rule of Criminal Procedure 17(c) be admissible as evidence at trial. The court did not consider respondents' contention that enforcement of the subpoenas would likely infringe their First Amendment rights.

Held:

1. The Court of Appeals did not apply the proper standard in evaluating the subpoenas issued to respondents. Pp. 297-303.

(a) The Nixon standard does not apply in the context of grand jury proceedings. The unique role of a grand jury makes its subpoenas much different from subpoenas issued in the context of a criminal trial. Thus, this Court has held that a grand jury may compel the production of evidence or the testimony of witnesses as it considers appropriate, and that its operation generally is unrestrained by the technical procedural and evidentiary rules governing the conduct of criminal trials. Nixon § multifactor test would invite impermissible procedural delays and detours while courts evaluate the relevancy and admissibility of documents sought by a particular subpoena. Additionally, requiring the Government to explain in too much detail the particular reasons underlying a subpoena threatens to compromise the indispensable secrecy of grand jury proceedings. Broad disclosure also affords the targets of investigation far more information about the grand jury's workings than the Rules of Criminal Procedure appear to contemplate. Pp. 297-299.

(b) The grand jury's investigatory powers are nevertheless subject to the limit imposed by Rule 17(c), which provides that "the court on motion made promptly may quash or modify the subpoena if compliance would be unreasonable or oppressive" (emphasis added). Since a grand jury subpoena issued through normal channels is presumed to be reasonable, the burden of showing unreasonableness, as the above language indicates, must be on the recipient who seeks to avoid compliance, and the Court of Appeals erred to the extent that it placed an initial burden on the Government. Moreover, where, as here, a subpoena is challenged on relevancy grounds, the motion to quash must be denied unless the district court determines that there is no reasonable possibility that the category of materials the Government seeks will produce information relevant to the general subject of the grand jury's investigation. Since respondents did not challenge the subpoenas as being too indefinite or claim that compliance would be overly burdensome, this Court does not consider these aspects of the subpoenas. Pp. 299-301.

(c) Because it seems unlikely that a challenging party who does not know the general subject matter of the grand jury's investigation will be able to make the necessary showing that compliance with a subpoena would be unreasonable, a court may be justified in requiring the Government to reveal the investigation's general subject before requiring the challenger to carry its burden of persuasion. However, this question need not be resolved here, since there is no doubt that respondents knew the subject of the particular investigation. Pp. 301-302.

(d) Application of the above principles demonstrates that the District Court correctly denied respondents' motions to quash. Based on the undisputed facts that all three companies are owned by the same person, that all do business in the same area, and that Model has shipped sexually explicit materials into the Eastern District of Virginia, the court could have concluded that there was a reasonable possibility that respondents' business records would produce information relevant to the grand jury's investigation, notwithstanding respondents' self-serving denial of any connection to Virginia. Pp. 302-303.

2. This Court expresses no view on, and leaves to the Court of Appeals to resolve, the issue whether, based on respondents' contention that the records subpoenaed related to First Amendment activities, the Government was required to demonstrate that they were particularly relevant to the investigation. P. 303.

884 F.2d 772 (CA4 1989), reversed in part and remanded.

O'CONNOR, J., delivered the opinion for a unanimous Court with respect to Parts I and II, the opinion of the Court with respect to Parts III-A and IV, in which REHNQUIST, C.J., and WHITE, SCALIA, KENNEDY, and SOUTER, JJ., joined, and the opinion of the Court with respect to Part III-B, in which REHNQUIST, C.J., and WHITE, KENNEDY, and SOUTER, JJ., joined. STEVENS, J., filed an opinion concurring in part and concurring in the judgment, in which MARSHALL and BLACKMUN, JJ., joined, post, p. ---.

William C. Bryson, Washington, D.C., for petitioner.

Herald P. Fahringer, New York City, for respondents.

Justice O'CONNOR delivered the opinion of the Court. ^[1]

Notes

1. Justice SCALIA joins in all but Part III-B of this opinion.