EFTA01263240.pdf

U.S. Department of Justice
United States Attorney
Southern District of New York
The Silvio J. Mono Building
One Saint Andrew's Plaza
New York. New York 10007
February 28, 2019
TO BE FILED UNDER SEAL
VIA EMAIL
The Honorable Robert W. Sweet
United States District Court
Southern District of New York
United States Courthouse
New York, New York 10007
Re: In re Application to Unseal Civil Discovery Materials, USAO No. 2018R01618
Dear Judge Sweet:
The Government writes respectfully in connection with its sealed application and proposed
order pursuant to the All Writs Act, Title 28, United States Code, Section 1651, for a limited order
to unseal discovery materials in the possession of Boies Schiller & Flexner LLP
(the "A in connection with the matter v. Ghislaine Maxwell, et at
(a"), 15 Civ. 7433 (RWS) (the "Litigation"), a copy of which is enclosed as Exhibit A.
Background
As described in the Application, the Government has served a grand jury subpoena
(the "Subpoena") upon Boies Schiller & Flexner ("Boies Schiller") requiring the production of
copies of discovery and related materials related to the Litigation. The Subpoena was validly
issued pursuant to an ongoing investigation into Jeffrey Epstein and others, for possible violations
of Title 18, United States Code, Sections 1591 and 1594(c) (unlawfully trafficking minors) and
Section 2422(b) (unlawfully enticing minors) (the "Investigation"). The production of materials
pursuant to the Subpoena is solely for the purposes of the Investigation, and is subject to the
protections and restrictions of Fed. R. Crim. P. 6(e).
The Government has been advised that Boies Schiller, which is counsel for plaintiffs in the
Litigation, does not intend to contest the Subpoena. However, the Government is advised that
although Boies Schiller would not otherwise contest compliance with the Subpoena, it believes
that a protective order entered in the Litigation (the "Protective Order") may preclude compliance.
Accordingly, the Government respectfully requested that the Court issue an order
permitting Boies Schiller to comply with the validly-issued Subpoena.
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Discussion
Where, as here, a grand jury subpoena has validly issued, and the recipient of the subpoena
is not contesting compliance—but rather seeking authorization to comply with the subpoena—a
court should grant such permission through limited modification of an applicable protective order,
absent countervailing interests not present in this case. As described below, a court can and should
modify a protective order, or permit limited relief from it, to allow the recipient of a grand jury
subpoena to comply with such a subpoena under the circumstances presented here.
The Court is best guided by the decision in Chemical Bank v. Affiliated FM Ins. Co., 154
F.R.D. 91 (S.D.N.Y. 1994), which rejected an application for a party in civil litigation to be held
in contempt for complying with a grand jury subpoena despite the existence of a protective order,
without first obtaining authorization from the court, because the court would have granted such
authorization had it been sought. Chemical Bank, 154 F.R.D. at 93. As that court explained:
The role of the federal courts in law enforcement, exemplified by
the Federal Criminal Code (Title 18, USC) and in enforcing Grand
Jury subpoenas argues in favor of making significant information
available to enforcement authorities absent a countervailing
showing that the need for the information for such purposes is
outweighed by the need for protecting expectations of
confidentiality under Fed. R. Civ. P. 26(c).
Id. at 94 (citing United States v. Davis, 702 F.2d 418, 421-22 (2d Cir. 1983) (finding that the
"conflict between protection of private material used in a civil proceeding and public need in a
criminal prosecution" posed in that case was "easily resolved" and explaining that "[a]bsent
applicable grounds for exception, such as a previously asserted Fifth Amendment privilege, no
shiled protects the civil evidence" in that case "from compellable production before the grand jury
which subpoenaed it"). The court in Chemical Bank chastised the relevant party for responding to
the grand jury subpoena without authorization specifically because such disregard was "entirely
unnecessary and inappropriate" due to the readily available remedy of a modification of the
applicable protective order. Chemical Bank, 154 F.R.D. at 93. The court also explicitly noted that
such formal judicial approval could be obtained ex pane if sufficient reason for doing so was
shown. Id.
Chemical Bank further described the types of interests that otherwise might be implicated
in connection with a Rule 26(c) protective order, none of which are implicated here. Id. at 94
("There is no indication that any difficult balancing under Fed.R.Civ.P. 26(c) would have been
necessary of interests of law enforcement against protection of technological trade secrets,
currently sensitive customer lists, or contemporarily sensitive competitive information which
could benefit rivals, since no such information has been claimed to have been contained in any of
the discovery materials in this case.") (citations omitted).'
Notably, here, and in contrast to other cases further described below, the Government's specific
knowledge of the subject matter of discovery materials is relatively limited, due to the confidential
nature of the Litigation; however, the Protective Order itself indicates that discovery materials
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Indeed, the Chemical Bank opinion specifically rejected judicial protection for the type of
information the Protective Order appears to cover in the Litigation:
Avoiding embarrassment may be a reason for a party to seek
confidentiality. It is not by itself a valid reason for courts to uphold
confidentiality as against a legitimate law enforcement need for the
information. Courts must honor restrictions laid down by the Fourt
or Fifth Amendment or applicable statutes. But aside from those
restrictions, hiding possible criminal violations from law
enforcement authorities is hardly a groundf or judicial protection of
confidentiality.
Chemical Bank, 154 F.R.D. at 94 (emphasis added). Although parties may rely on confidentiality
agreements and protective orders generally, such classification "is not binding on the court" and
the "risk of disclosure is well known to the Bar, in part because disclosure may be required where
such information is needed for judicial decisions, to the basis for which the public should have
access. Id. (collecting cases).
Under some circumstances, courts in this Circuit have applied a balancing test to evaluate
the government's ability to obtain access to materials covered by a protective order. Specifically,
in Martindell v. International Tel. and TeL Corp., 594 F.2d 291 (2d Cir. 1979), the government
informally—and without use of a grand jury subpoena—sought access to discovery materials from
a civil litigation. The Court held that the Government was not entitled to the materials unless it
could show either that the protective order was improvidently granted or some extraordinary
circumstance or compelling need for the material; see also In re Grand Jury Subpoena Duces
Tecum Dated Apr. 19, 1991 ("Subpoena Duces Tecum"), 945 F.2d 1221, 1224 (2d Cir. 1991) (in
connection with bankruptcy proceeding, and citing Martindell, vacating denial of a motion to
quash a grand jury subpoena seeking production of documents subject to protective order and
remanding for determination of showing that the order was improvidently granted or of
extraordinary circumstance or compelling need).
As an initial matter, the Court need not employ the Martindell balancing test here. This is
so for two reasons. First, Martindell and cases employing its balancing test generally relate to
motions to quash or other challenges to a grand jury subpoena, or else instances where the
Government sought protected information without such grand jury process. See Martindell, 594
F.2d 291 (in which the government informally, and without use of a grand jury subpoena, sought
access to discovery materials); Subpoena Duces Tenon, 945 F.2d at 1224 (vacating denial of a
motion to quash a grand jury subpoena). Here, there is no such deficiency in the form of request
nor a challenge by the recipient of the subpoena. Indeed, in Chemical Bank, which cited
such as documents and depositions are not likely to include the kind of confidential business
information that Chemical Bank describes as having the potential to give rise to "difficult
balancing." See id.; see also =, Protective Order ("Prot. Order") (Dkt. 62) at 2 (defining
"confidential" information simply as "information that is confidential and implicates common law
and statutory privacy interests of (a) plaintiff and (b) defendant Ghislaine
Maxwell" and making no reference to trade secrets or other confidential business information).
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MartindelI , the district court opined that had the Government obtained judicial relief to issue an
uncontested subpoena for documents—precisely the scenario here—such relief would be
appropriate. Chemical Bank, 154 F.R.D. at 94.
Second, any presumption against modification of a protective order is unreasonable where,
as here, the protective order is on its face temporary or limited. Such protective orders "that are
on their face temporary or limited may not justify reliance by the parties [and] in such
circumstances reliance may be unreasonable." S.E.C. v. TheStreet.com, 273 F.3d 222, 230-31 (2d
Cir. 2001). "Where a litigant or deponent could not reasonably have relied on the continuation of
a protective order"—for example, where such an order was limited to the pretrial stages of
litigation—"a court may properly permit modification of the order." Id. (citing In re "Agent
Orange" Prod. Liab. Litig., 821 F.2d 139, 147 (2d Cir. 1987)); see also Alien v. City ofN ew York,
420 F.Supp.2d 295, 301 (S.D.N.Y. 2006) (Mag. J. Gorenstein) (analyzing the differently-situated
interests of civil litigants but where, as here, the relevant protective order specified that a party
could object to the designation of a document as confidential, and was also temporary or limited
on its face). In such a case, "'[w]hether to lift or modify a protective order is a decision committed
to the sound discretion of the trial court."' TheStreet.com, 273 F.3d at 231 (modification in
original) (citing In re Agent Orange, 821 F.3d at 147) (additional citations omitted). Here, the
parties in the Litigation explicitly contemplated the public disclosure of such information at trial
by the very terms of the Protective Order, thereby establishing precisely the kind of temporal limit
described above. See Prot. Order at 5 ("This Protective Order shall have no force and effect on
the use of any CONFIDENTIAL INFORMATION at trial in this matter."). The parties could not
have—as, for example, they might in a bankruptcy proceeding such as in Subpoena Duces
Tecum-relied upon the Protective Order to indefinitely keep the relevant materials hidden.
In this case, where the Protective Order is limited by its terms to only the pretrial stages
of the civil litigation, no confidential business information appears to be at issue, and counsel for
the victims of the suspected crimes being investigated have indicated a willingness to voluntarily
comply with the Subpoena, the "sound discretion of [this] court," TheStreet.com, 273 F.3d at 231,
militates overwhelmingly toward limited, narrow modification of the Protective Order to permit
compliance with the Subpoena.' This is consistent with the grand jury's "wide ranging authority
to inquire into suspected violations of the criminal law; and to effectuate such investigations it may
compel the production of documentary evidence or the testimony of witnesses, as it deems
necessary." Id. at 421-22; see Branzburg v. Hayes, 408 U.S. 665, 688 (1972) ("Although the
powers of the grand jury are not unlimited and are subject to the supervision of a judge, the
longstanding principle that `the public . . . has a right to every man's evidence,' except for those
2 The Government notes that any materials produced pursuant to a grand jury subpoena fall under
the protections and restrictions set forth in Fed. R. Crim. P. 6(e), and further notes and emphasizes
that the proposed order accompanying the Application provides no additional exception or
modification to the Protective Order as to the recipient of the subpoena other than the narrow,
limited ability to comply with grand jury process. The Protective Order will remain otherwise
intact and fully enforceable.
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persons protected by a constitutional, common-law, or statutory privilege is particularly applicable
to grand jury proceedings.") (citations omitted).;
Finally, even were the Court to apply the Martindell test here,4 despite the significant
distinguishing factors described above, this Investigation is a paradigmatic example of
extraordinary circumstances. In the first instance, unlike in Subpoena Duces Tecum, the posture
of the Application does not involve a motion to quash. Of course, should this Court permit Boies
Schiller to respond, Boies Schiller would have the right to move to quash—including, for example,
if a grand jury subpoena made any improper requests, such as for materials subject to privilege.
But it is not anticipated that Boies Schiller will do so.
Additionally, as set forth in the Application, the existence and scope of the Investigation
in this district is not publicly known. While counsel for certain victims are aware of the
Investigation, neither Epstein nor other subjects of the investigation are believed to be similarly
aware. Accordingly, the ordinary exercise of grand jury power to "subpoena witnesses to testify,
regardless of whether they have already testified or furnished documentary evidence in civil
litigation," Martindell, 594 at 296, would implicate and invite the very risk of disclosure—and the
possibility of alerting potential criminal targets that they are under investigation, causing them to
destroy evidence, flee from prosecution, or otherwise seriously jeopardize the Investigation—that
caused the Government to proceed via subpoena and its related Application. Cf. Subpoena Duces
Tecum, 945 F.2d at 1224 (in which the party that moved to quash the relevant subpoena argued
that the government could not meet its burden of showing need for deposition testimony until it
had at least called the witness before the grand jury).
The subject matter of the Litigation also demonstrates the extraordinary circumstances of
the Government's Investigation and Application, insofar as the materials at issue here appear not
to be of the sort that ordinarily would provide protection against Government investigation. See
3 To read Martindell more broadly would not only be contrary to the opinion itself, as described
above, but would risk rendering that opinion in even further conflict with the well-reasoned
decisions of numerous other Circuits. In particular, the Fourth, Ninth, and Eleventh Circuits have
each adopted a per se rule favoring enforcement of a grand jury subpoena even where a protective
order exists. See In re Grand Jury Subpoena, 836 F.2d 1468, 1477 (4th Cir.), cert. denied, 487
U.S. 1240 (1988); In re Grand Jury Subpoena Served on Meserve, Mumper & Hughes, 62 F.3d
1222, 1226-1227 (9th Cir. 1995); In re Grand Jury Proceedings (Williams), 995 F.2d 1013, 1020
(11th Cir. 1993) (expressly criticizing the Martindell test and stating that it "is administratively
unworkable," "defies construction," and "places prosecutors in untenable positions"). In the First
and Third Circuits, a grand jury subpoena overrides a protective order unless the party seeking to
quash the subpoena shows "exceptional circumstances that clearly favor subordinating the
subpoena to the protective order." hi re Grand Jury Subpoena (Roach), 138 F.3d 442, 445 (1st
Cir.), cert. denied, 524 U.S. 939 (1998); hi re: Grand Jury, 286 F.3d 153, 157-158 (3d Cir.
2002). The Government is aware of no case in those circuits where the presumption was rebutted
and the grand jury subpoena was not enforced.
4 An application of the Martindell test would not in any event preclude the provision of a list of
witnesses deposed, see 594 F.2d at 293, and of pre-existing documents collected or produced in
the course of discovery, see id. at 297 n.8.
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Chemical Bank, 154 F.R.D. at 94 (describing such materials a "technological trade secrets,
currently sensitive customer lists, or contemporarily sensitive competitive information which
could benefit rivals"). Rather, the Government seeks materials that relate to among the gravest
criminal offenses it investigates—the sexual exploitation of minors—which materials, if revealed,
would tend to inculpate and/or embarrass some parties to the Protective Order. Indeed, by the very
terms of the Protective Order, the confidential materials appear to be of the category for which
"[a]voiding embarrassment . . . is not by itself a valid reason for courts to uphold confidentiality
as against a legitimate law enforcement need for the information." Id.; see also Prot. Order at 2
(designating as "confidential" only information that is "confidential and implicates common law
and statutory privacy interests of" the plaintiff and defendant"). "Aside from those restrictions
[laid down by the Fourth or Fifth Amendment or applicable statutes], hiding possible criminal
violations from law enforcement authorities is hardly a ground for judicial protection of
confidentiality." Chemical Bank, 15 F.R.D. at 94.
Finally, this is unlike a case in which the contours of the civil litigation are publicly
apparent. Cf. Subpoena Duces Tecum, 945 F.2d at 1223 (noting that a "lengthy report" of the
bankruptcy examination in that case "was made available to the public"). In Subpoena Duces
Tecum, for example, not only was the government apparently unconcerned with the confidentiality
of the grand jury investigation, but the government knew from a lengthy public report precisely
what it might replicate through a grand jury investigation. Id. Not so with respect to the Litigation,
which resulted in no such report, no trial, and limited public filings.
For all of these reasons, and for the reasons set forth in the Application, the Government
respectfully requests that the Court grant the Application.
Respectfully submitted,
GE FFREY S. BERMAN
Un. ed States Attorney
By:
Assistant United States Attorney
Tel.:
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