Oberlander v. United States (In re Grand Jury Proceeding)

971 F.3d 40

IN RE: GRAND JURY PROCEEDING

Frederick Martin Oberlander, Respondent-Appellant,

Richard E. Lerner, Respondent,

v.United States of America, Movant-Appellee.

No. 18-3485

August Term 2019

United States Court of Appeals, Second Circuit.

Argued: August 26, 2019

Decided: June 3, 2020

Amended: August 14, 2020

Frederick M. Oberlander, Esq., pro se, Montauk, New York.

Richard D. Belliss (Stephen C. Green, on the brief) Assistant United States Attorneys, for Grant C. Jaquith, United States Attorney for the Northern District of New York, Albany, New York, for Movant-Appellee United States of America.

Before: Winter, Pooler, and Sullivan, Circuit Judges.

Richard J. Sullivan, Circuit Judge:

Respondent-Appellant Frederick Oberlander challenges orders issued by the district court (LaShann DeArcy Hall, Judge ) denying his motion to quash various grand jury subpoenas and directing him to comply with the subpoenas on pain of coercive monetary sanctions. Oberlander argues that the district court lacked jurisdiction to enforce those subpoenas because they were either issued by the government without a sitting grand jury or were enforced only after the issuing grand jury had expired. In addition, Oberlander argues that the subpoenas were overbroad, issued for an improper purpose, and infringed upon his First and Fifth Amendment rights.

We VACATE IN PART , AFFIRM IN PART, and REMAND , holding that (1) the district court lacked jurisdiction to enforce a subpoena issued without a sitting grand jury; (2) the district court retained jurisdiction to oversee a subpoena involving the same subject matter that was subsequently issued by a newly impaneled grand jury; and (3) the district court ceased to have jurisdiction to enforce the validly issued subpoena after the issuing grand jury's term expired. Nevertheless, because yet another grand jury has been impaneled and has issued an identical subpoena, we have jurisdiction to reach the merits of Oberlander's motion to quash and find that the subpoena was neither overbroad nor issued with an improper purpose, and that it did not infringe upon Oberlander's First or Fifth Amendment rights.

I. Background

A. Prior Proceedings

In 1998, Felix Sater pleaded guilty to participating in a "pump and dump" securities fraud scheme as a part of a racketeering enterprise involving the La Cosa Nostra organized crime families. Estate of Gottdiener v. Sater , 35 F. Supp. 3d 386, 391 (S.D.N.Y. 2014) ; see also Information at 10, United States v. Sater , No. 98-cr-1101 (ILG) (E.D.N.Y. Dec. 10, 1998), ECF No. 6. Over the next decade, he secretly cooperated with the government in an undercover capacity, providing "valuable foreign intelligence as well as information concerning some of the most elusive and dangerous criminals of interest to U.S. law enforcement." United States v. Sater , No. 98-cr-1101 (ILG), 2019 WL 3288389, at *1 (E.D.N.Y. July 22, 2019). Although Sater's criminal proceedings were finally terminated when he was sentenced in 2009, the fact of his cooperation remained sealed until it was inadvertently disclosed by the Office of the Clerk of Court in August 2012. See In re Applications to Unseal 98 CR 1101(ILG) , 568 F. App'x 68, 69 (2d Cir. 2014) ; see also Sater , 2019 WL 3288389, at *1 (discussing Sater's cooperation as a matter of public record).

Between 2010 and 2013, on the heels of Sater's sentencing, Oberlander filed a series of lawsuits seeking compensation on behalf of clients who alleged that Sater had defrauded them. See Notice of Removal, Kriss v. BayRock Grp. LLC , No. 13-cv-3905 (LGS) (S.D.N.Y. June 7, 2013), ECF No. 1; Complaint, Estate of Gottdiener v. Sater , No. 13-cv-01824 (LGS) (S.D.N.Y. March 18, 2013), ECF No. 1; Complaint, Kriss v. BayRock Grp. LLC , No. 10-cv-3959 (LGS) (S.D.N.Y. May 10, 2010), ECF No. 1. As part of those lawsuits, Oberlander sought to publicly disclose information about Sater's cooperation with the government, even going so far as to attach sealed materials to the complaints as exhibits. See Roe v. United States , 428 F. App'x 60, 63–64 (2d Cir. 2011). Ultimately, this Court enjoined Oberlander from publicly disclosing any sealed information and directed the Chief Judge of the Eastern District of New York to appoint a special master to oversee compliance with the relevant sealing orders. Roe v. United States , 414 F. App'x 327, 329 (2d Cir. 2011) ; see also In re Applications to Unseal 98 CR 1101 (ILG), 568 F. App'x at 70 (affirming sealing orders); Roe , 428 F. App'x at 68 (affirming injunction).

In August 2012, Sater commenced a civil contempt proceeding against Oberlander, alleging that Oberlander had intentionally violated this Court's disclosure injunction. See Motion, In re Motion for Civil Contempt by John Doe , No. 12-mc-557 (PKC) (E.D.N.Y. Aug. 22, 2012), ECF No. 1. In March 2015, Judge Cogan, then serving as special master, issued an order directing Oberlander to show cause as to why he had not violated the sealing orders and this Court's orders by repeatedly disclosing sealed documents and other information between February 2011 and January 2015. See id. , ECF No. 97. Four months later, Judge Cogan referred the matter to the United States Attorney for the Eastern District of New York for a criminal investigation. See id. , ECF. No. 117. The United States Attorney's Office for the Eastern District of New York subsequently recused itself and referred the investigation to the United States Attorney for the Northern District of New York.

B. Grand Jury and District Court Proceedings

In April 2016, following Judge Cogan's referral, a grand jury was impaneled in the Eastern District of New York (the "First Grand Jury") to investigate Oberlander's conduct with respect to the sealing orders. Two months later, in June 2016, the First Grand Jury issued the first of at least four subpoenas requesting documents from Oberlander relating to his communications with reporters. Oberlander refused to comply with the subpoena, and the First Grand Jury's term expired on December 14, 2016.

Nevertheless, over four months later, the government, apparently unaware that the First Grand Jury had expired, served Oberlander with another grand jury subpoena (the "April 2017 Subpoena") in connection with the same investigation. This subpoena, dated April 3, 2017, was directed to the custodian of records for Oberlander's law firm and requested the same records as the first subpoena, as well as the custodian's testimony. Neither Oberlander nor a different records custodian appeared to give testimony, and no records were produced. Meanwhile, on April 19, 2017, a new grand jury was impaneled (the "Second Grand Jury") to investigate the same conduct: Oberlander's mishandling of sealed documents and his violation of court-issued sealing orders.

In August 2017, the government filed a motion to compel Oberlander to comply with the April 2017 Subpoena. The district court granted the motion a week later. After eight months and at least nine extensions of time, Oberlander filed a pro se motion to quash the subpoena on May 7, 2018.

On June 6, 2018, the district court denied Oberlander's motion to quash but directed the government to reissue the April 2017 Subpoena with minor amendments not relevant here. The court further ordered Oberlander to produce the documents demanded by the soon-to-be-reissued subpoena within a month and warned that failure to comply would "result in sanctions, including the imposition of coercive fines or imprisonment pending compliance." Gov't App'x at 133.

On June 12, 2018, in accordance with the district court's direction, the Second Grand Jury issued a revised subpoena (the "June 2018 Subpoena"), which, like the prior two subpoenas, sought records of communications between Oberlander and eight news reporters "involving any matters about Felix Sater" and others occurring between January 11, 2011 and February 1, 2015. Gov't App'x at 136. The June 2018 Subpoena also required the custodian of records to testify before the Second Grand Jury.

On June 22, 2018, Oberlander filed a motion for reconsideration of his motion to quash the April 2017 Subpoena and to stay enforcement of the district court's June 6 order, which the district court denied on June 27, 2018.¹ In so doing, the district court again warned Oberlander that his continued failure to produce responsive documents would result in coercive sanctions.

On July 3, 2018, one day before the production deadline set by the district court's June 6 order, Oberlander produced responsive records for the period beginning on January 9, 2013 – the date on which Oberlander had incorporated his law practice – and continuing through the June 2018 Subpoena's end date. Oberlander subsequently submitted to the district court additional records covering the period from the subpoena's start date to January 8, 2013 – a period in which Oberlander operated his law firm as an unincorporated sole proprietorship. Relying on that fact, Oberlander, ostensibly moving to quash the June 2018 Subpoena, requested that the court review those records in camera to determine whether they constituted personal records protected by the Fifth Amendment's "act of production" privilege – an argument that he had already raised, unsuccessfully, in his motion to quash the April 2017 Subpoena. Predictably, on September 25, 2018, the district court, treating Oberlander's request as "an additional baseless motion for reconsideration," determined that the records were not protected by the Fifth Amendment and ordered Oberlander to produce them "to the government" within six days. Gov't App'x at 144, 146.

Despite this order, Oberlander still had not produced the withheld documents by October 17, 2018 – the date on which the Second Grand Jury, which issued the June 2018 Subpoena, expired. Five days later, without an impaneled grand jury, the government filed a motion to compel Oberlander to produce all withheld documents as required by the district court's...