United States v. Stringer ( 2008 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA,  No. 06-30100
Plaintiff-Appellant, D.C. No.
v. CR-03-00432-ALH
J. KENNETH STRINGER, III; J. MARK  ORDER
SAMPER; WILLIAM N. MARTIN, AMENDING
Defendants-Appellees. OPINION AND
AMENDED
 OPINION
Appeal from the United States District Court
for the District of Oregon
Ancer L. Haggerty, District Judge, Presiding
Argued and Submitted
September 26, 2007—Portland, Oregon
Filed April 4, 2008
Amended July 31, 2008
Before: Mary M. Schroeder, Barry G. Silverman and
Jay S. Bybee, Circuit Judges.
Opinion by Judge Schroeder
9705
UNITED STATES v. STRINGER 9709
COUNSEL
Karin J. Immergut, United States Attorney; Hannah Horsley,
Assistant United States Attorney; and Kelly A. Zusman,
Assistant United States Attorney, Portland, Oregon, for
plaintiff-appellant United States of America.
Janet Lee Hoffman, Hoffman Angeli LLP, Portland, Oregon,
for defendant-appellee J. Kenneth Stringer, III.
Ronald H. Hoevet, Hoevet, Boise & Olson, P.C., Portland,
Oregon, for defendant-appellee Mark Samper.
John S. Ransom and Kendra Matthews, Ransom Blackman
LLP, Portland, Oregon, for defendant-appellee William Mar-
tin.
ORDER
The opinion in this matter filed on April 4, 2008, and pub-
lished at United States v. Stringer, 521 F.3d 1189 (9th Cir.
2008), is amended as follows:
On slip op. 3549, replace the listed counsel, lines 3-10, with
the following:
Karin J. Immergut, United States Attorney; Hannah
Horsley, Assistant United States Attorney; and Kelly
A. Zusman, Assistant United States Attorney, Port-
land, Oregon, for plaintiff-appellant United States of
America.
9710 UNITED STATES v. STRINGER
Janet Lee Hoffman, Hoffman Angeli LLP, Portland,
Oregon, for defendant-appellee J. Kenneth Stringer,
III.
Ronald H. Hoevet, Hoevet, Boise & Olson, P.C.,
Portland, Oregon, for defendant-appellee Mark Sam-
per.
John S. Ransom and Kendra Matthews, Ransom
Blackman LLP, Portland, Oregon, for defendant-
appellee William Martin.
On slip op. 3550, replace the first full paragraph with the
following:
Accepting the district court’s factual findings
under the clear error standard, we hold that the gov-
ernment’s conduct does not amount to a constitu-
tional violation under either the Fourth or Fifth
Amendments. We vacate the dismissal of the indict-
ments because in a standard form it sent to the defen-
dants, the government fully disclosed the possibility
that information received in the course of the civil
investigation could be used for criminal proceedings.
There was no deceit; rather, at most, there was a
government decision not to conduct the criminal
investigation openly, a decision we hold the govern-
ment was free to make. There is nothing improper
about the government undertaking simultaneous
criminal and civil investigations, and nothing in the
government’s actual conduct of those investigations
amounted to deceit or an affirmative misrepresenta-
tion justifying the rare sanction of dismissal of crimi-
nal charges or suppression of evidence received in
the course of the investigations.
On slip op. 3556, replace the last sentence of the second
paragraph with the following:
UNITED STATES v. STRINGER 9711
Rosenbaum represented Meussle, as well as Samper
and FLIR.
On slip op. 3559, replace the citation sentence in the first
partial paragraph with the following:
See, e.g., United States v. Carriles, 486 F. Supp. 2d
599, 615, 619 (W.D. Tex. 2007), appeal pending,
No. 07-50737 (5th Cir.); United States v. Rand, 308
F. Supp. 1231, 1233, 1237 (N.D. Ohio 1970).
On slip op. 3568, insert the following as the first full para-
graph:
The panel shall retain jurisdiction over any subse-
quent appeal in this matter.
Defendant-Appellee Martin’s Petition for Rehearing En
Banc, Defendant-Appellee Stringer’s Petition for Rehearing
and Suggestion for Rehearing En Banc, and Defendant-
Appellee Samper’s Petition for Rehearing En Banc are
denied. No subsequent petition for rehearing or rehearing en
banc may be filed.
OPINION
SCHROEDER, Circuit Judge:
I. Introduction
The United States appeals from a final order of the district
court dismissing criminal indictments against three individual
defendants charging counts of criminal securities violations.
The dismissal was premised on the district court’s conclusion
that the government had engaged in deceitful conduct, in vio-
lation of defendants’ due process rights, by simultaneously
9712 UNITED STATES v. STRINGER
pursuing civil and criminal investigations of defendants’
alleged falsification of the financial records of their high-tech
camera sales company. Foreseeing the possibility of an
appeal, the district court held that the indictments must be dis-
missed, but ruled in the alternative that, should there be a
criminal trial, all evidence provided by the individual defen-
dants in response to Securities and Exchange Commission
(“SEC”) subpoenas should be suppressed. See United States
v. Stringer, 408 F. Supp. 2d 1083 (D. Or. 2006).
The court also suppressed evidence relating to the “Swed-
ish Drop Shipment,” an allegedly fraudulent accounting entry.
The district court reasoned that the government had improp-
erly interfered with, or intruded into, the attorney-client rela-
tionship of one of the defendants by accepting incriminating
evidence about the entry from a defense attorney. The attor-
ney had an apparent conflict of interest because she repre-
sented the corporation as well as an individual defendant.
Accepting the district court’s factual findings under the
clear error standard, we hold that the government’s conduct
does not amount to a constitutional violation under either the
Fourth or Fifth Amendments. We vacate the dismissal of the
indictments because in a standard form it sent to the defen-
dants, the government fully disclosed the possibility that
information received in the course of the civil investigation
could be used for criminal proceedings. There was no deceit;
rather, at most, there was a government decision not to con-
duct the criminal investigation openly, a decision we hold the
government was free to make. There is nothing improper
about the government undertaking simultaneous criminal and
civil investigations, and nothing in the government’s actual
conduct of those investigations amounted to deceit or an affir-
mative misrepresentation justifying the rare sanction of dis-
missal of criminal charges or suppression of evidence
received in the course of the investigations.
We also reverse the order excluding evidence received
from the conflicted attorney. We do so because the govern-
UNITED STATES v. STRINGER 9713
ment advised the attorney of the existence of a potential con-
flict and did not interfere with the attorney-client relationship.
II. Background
A. The concurrent SEC civil and U.S. Attorney
criminal investigations
Prior to the criminal action that forms the basis of this
appeal, the SEC began investigating the defendants, J. Ken-
neth Stringer, III, J. Mark Samper, and William N. Martin,
and their company for possible civil securities fraud viola-
tions. The company was FLIR Systems, Inc. (“FLIR”), an
Oregon corporation headquartered in Portland that sells infra-
red and heat-sensing cameras for military and industrial use.
The SEC began the investigation on June 8, 2000. About two
weeks later, the SEC held the first of a series of meetings with
the Oregon United States Attorney’s Office (“USAO”) to
coordinate the ongoing SEC investigation with a possible
criminal investigation. An SEC Assistant Director and an
SEC Staff Attorney met with the supervisor of the white col-
lar crime section of the USAO to discuss the possibility of
opening a criminal investigation. The meeting apparently con-
vinced the USAO supervisor to investigate. Within days, the
USAO and the Federal Bureau of Investigation (“FBI”)
opened a criminal investigation.
Federal securities laws authorize the SEC to transmit evi-
dence it has gathered to the USAO to facilitate a criminal
investigation by the USAO. See 15 U.S.C. §§ 77t(b), 78u(d).
To gather evidence for its criminal investigation, the Oregon
USAO in June of 2000 sent a letter to the SEC (the “Access
Letter”) requesting access to the SEC’s non-public investiga-
tive files, and the SEC promptly granted access.
The civil and criminal investigations proceeded in tandem
and the SEC continued to meet and communicate with the
9714 UNITED STATES v. STRINGER
USAO and FBI. The SEC turned over documents the SEC
collected through its civil investigation.
At the beginning of the criminal investigation, the USAO
identified two of the three defendants, FLIR’s former CEO,
Stringer, and former CFO, Samper, as possible targets, and
named them in the USAO’s Access Letter to the SEC. A few
months later, in October 2000, the Assistant United States
Attorney (“AUSA”) assigned to the case made a list of the
subjects of the investigation and placed asterisks and the com-
ment “knew what [was] going on” next to the entries for Sam-
per and Stringer. A month later, the AUSA stated in his
handwritten notes that Stringer had “lied [about] his role in”
the company. In April 2001, an e-mail from the SEC Staff
Attorney to the SEC Assistant Director stated the AUSA “de-
fine[d] [the] targets as Ken Stringer and Mark Samper.”
The district court concluded that the third defendant, Mar-
tin, former VP of Sales, was also an early potential target of
the criminal investigation. Martin appears on the AUSA’s
early list of the subjects of the investigation above the com-
ment “knew pushing up sales.” During a January 2001 meet-
ing, the SEC advised the USAO and FBI that FLIR was
blaming Stringer and Martin for the fraudulent conduct at the
heart of the investigation.
Early in the criminal investigation, the USAO decided the
investigation should remain confidential. At an October 2000
meeting between the SEC, USAO, and FBI, the AUSA
advised that the evidence collected by the SEC might support
criminal wire fraud charges. Nonetheless, an internal FBI
memo issued in late October stated that the AUSA had con-
cluded, based on the defendants’ cooperation with the SEC at
that point, that the SEC should investigate “without the assis-
tance or inclusion of the FBI.” At the January 2001 meeting
between the SEC, FBI, and USAO, the SEC revealed that
FLIR was cooperative and was providing evidence that was
damaging to Stringer and Martin.
UNITED STATES v. STRINGER 9715
By June 2001, the USAO was not yet ready to convene a
grand jury and issue indictments. The SEC and USAO
believed that FLIR and defendant Samper would settle with
the SEC so long as the U.S. Attorney was not directly
involved. During a December 2001 phone conversation
between the AUSA assigned to the case and the SEC Assis-
tant Director, the AUSA continued to believe it was “pre-
mature [sic] to surface” and that the presence of an AUSA
would “impede” a meeting between the SEC and defendants.
During a December 2002 phone call, the SEC and USAO
decided that the USAO would not “surface”, i.e., convene a
grand jury and issue indictments, until the “end of Jan/early
Feb” 2003.
The SEC facilitated the criminal investigation in a number
of ways. The SEC offered to conduct the interviews of defen-
dants so as to create “the best record possible” in support of
“false statement cases” against them, and the AUSA
instructed the SEC Staff Attorney on how best to do that. The
AUSA asked the relevant SEC office, located in Los Angeles,
to take the depositions in Oregon so that the Portland Office
of the USAO would have venue over any false statements
case that might arise from the depositions, and the SEC did
so. Both the SEC and USAO wanted the existence of the
criminal investigation kept confidential. The SEC Staff Attor-
ney, at one of the Portland depositions, made a note that she
wanted to “make sure [the] court reporters won’t tell [FLIR’s
Attorney]” that there was an AUSA assigned to the case.
The SEC, however, did not hide from the defendants the
possibility — even likelihood — of such an investigation. The
SEC sent each of the defendants subpoenas in the summer of
2001, and attached to each was Form 1662, a form sent to all
witnesses subpoenaed to testify before the SEC. Under the
header “Routine Uses of Information,” the four-page form
states that “[t]he Commission often makes its files available
to other governmental agencies, particularly the United States
Attorneys and state prosecutors. There is a likelihood that
9716 UNITED STATES v. STRINGER
information supplied by you will be made available to such
agencies where appropriate.”
Form 1662 also advises witnesses of their Fifth Amend-
ment rights. After the heading “Fifth Amendment and Volun-
tary Testimony,” the form states that:
Information you give may be used against you in any
federal . . . civil or criminal proceeding brought by
the Commission of any other agency. You may
refuse, in accordance with the rights guaranteed to
you by the Fifth Amendment of the Constitution of
the United States, to give any information that may
tend to incriminate you or subject you to fine, pen-
alty, or forfeiture.
None of the defendants invoked his right against self-
incrimination during his deposition, and all proceeded to tes-
tify in compliance with the subpoena. Each of the defendants
was represented by counsel when he testified.
During the course of Stringer’s deposition, taken in Port-
land in October 2001, Stringer’s attorney actually questioned
the SEC Staff Attorney about the involvement of the USAO.
In response to those questions, the SEC Staff Attorney
answered as follows:
MR. MARTSON: My first question is whether Mr.
Stringer is a target of any aspect of the investigation
being conducted by the SEC.
STAFF ATTORNEY: The SEC does not have tar-
gets in this investigation.
MR. MARTSON: The other questions I have relate
to whether or not, in connection with your investiga-
tion, the SEC is working in conjunction with any
other department of the United States, such as the
UNITED STATES v. STRINGER 9717
U.S. Attorney’s Office in any jurisdiction, or the
Department of Justice.
STAFF ATTORNEY: As laid out in the 1662 form,
in the “routine use of” section there are routine uses
of our investigation, and it is the agency’s policy not
to respond to questions like that, but instead, to
direct you to the other agencies you mentioned.
MR. MARTSON: And which U.S. Attorney’s Office
might I inquire into?
STAFF ATTORNEY: That would be a matter up to
your discretion.
The record does not show the SEC did anything to impede
an inquiry, nor does it disclose that any inquiry was made.
The record reflects that the government never furnished
defendants with any false information concerning the exis-
tence of a criminal investigation.
In September 2002, a year before the criminal indictments,
defendants Samper and Martin entered into consent decrees in
the civil action, agreeing to pay penalties, disgorgement, and
pre-judgment interest.
B. The “Swedish Drop Shipment” evidence from the
attorney jointly representing defendants
Throughout the course of the SEC investigation, FLIR was
represented by attorney Lois Rosenbaum. Defendant Samper,
FLIR’s former CFO, had retained separate counsel. In March
2000, Rosenbaum sent Samper a letter offering to jointly rep-
resent FLIR, Stringer, and Samper. In the letter, Rosenbaum
claimed that based on her “present knowledge of the facts,”
she did not anticipate that any conflicts would arise between
the co-clients. The letter, however, advised the clients to con-
sult separate counsel before consenting to the joint representa-
9718 UNITED STATES v. STRINGER
tion and promised immediately to inform the clients if a
conflict did arise.
Samper’s separate counsel sent a letter to Rosenbaum stat-
ing that Samper consented to the “joint representation in spite
of the potential conflict of interest that may arise between the
clients.” Samper’s separate counsel continued to represent
him as monitoring counsel.
On June 30, 2000, the SEC sent Samper a subpoena with
Form 1662 enclosed. It warned of possible dangers of joint
representation. The form advised that “[y]ou may be repre-
sented by counsel who also represents other persons involved
in the Commission’s investigation. This multiple representa-
tion, however, presents a potential conflict of interest if one
client’s interests are or may be adverse to another’s.”
In July 2000, when the SEC learned that Rosenbaum was
representing FLIR and its employees, it immediately sent her
a letter warning of the specific dangers of this co-
representation. “We are concerned that the broad range of
interests possessed by your many clients cannot be adequately
represented by a single attorney.” The letter specifically
pointed out the potential conflict of interest in representing a
company under investigation by the SEC and upper level
management who may have civil liability. The letter stated
that, “Although it is far too early in the investigation for the
SEC staff to identify people who may possess liability, we are
troubled by the scope and breadth of your representation.”
Rosenbaum continued to represent both FLIR and Samper,
among others.
One of the eventual charges in the indictment was that two
of the involved defendants created the “Swedish Drop Ship-
ment,” an entry in FLIR’s books that allegedly recognizes
$4.6 million in revenue without substantiation. FLIR’s Con-
troller, David Meussle, first discovered the unsubstantiated
entry. Meussle believed that Stringer and Samper made the
UNITED STATES v. STRINGER 9719
entry. Rosenbaum represented Meussle, as well as Samper
and FLIR.
The SEC civil complaint, filed on September 30, 2002, two
years after the joint representation began, did not allege a
charge relating to the “Swedish Drop Shipment.” After
Rosenbaum received a copy of the complaint, she called the
SEC Staff Attorney, disclosed the existence of the “Swedish
Drop Shipment,” and facilitated SEC interviews with Meussle
in order to enhance the level of FLIR’s cooperation with the
government. Rosenbaum also sent a memo to the SEC that
contained possibly privileged communications she had with
Samper about the transaction. The criminal indictment later
charged that Stringer and Samper created the false entry. Thus
Rosenbaum, while representing Meussle and FLIR, appar-
ently in order to further the interests of FLIR, assisted the
SEC’s investigation.
C. Proceedings Below
On September 17, 2003, a grand jury returned an indict-
ment charging Stringer, Samper, and Martin with securities,
mail, and wire fraud. Defendants filed motions to dismiss the
indictments and to suppress statements they made to the SEC.
The district court dismissed the indictments and suppressed
the SEC statements because it concluded that the government,
in violation of the due process clause, abused its authority to
conduct parallel proceedings. United States v. Stringer, 408 F.
Supp. 2d 1083, 1088-89 (D. Or. 2006). The district court held
that the government violated defendants’ Fifth Amendment
due process rights by using trickery and deceit to conceal the
criminal investigation from defendants, id. at 1080, and con-
ducting a criminal investigation under the auspices of a civil
investigation, id. at 1089. The district court suppressed evi-
dence of the “Swedish Drop Shipment” on the basis of its
conclusion that the government interfered with Samper’s
attorney-client relationship in violation of his due process
rights. Id. at 1091-92.
9720 UNITED STATES v. STRINGER
This appeal by the government followed. This court has
jurisdiction pursuant to 18 U.S.C. § 3731.7
III. Discussion
A. The parallel investigations
[1] The Supreme Court has held that the government may
conduct parallel civil and criminal investigations without vio-
lating the due process clause, so long as it does not act in bad
faith. See United States v. Kordel, 397 U.S. 1, 11 (1970). In
Kordel, the Supreme Court held that the government did not
violate the due process rights of corporate executives when it
used evidence it obtained from an FDA civil investigation to
convict them of criminal misbranding. 397 U.S. 1 at 11. The
Court explained that the FDA did not act in bad faith when
it made a request for information, which ultimately was used
in the criminal investigation, for the agency made similar
requests as a matter of course in 75% of its civil investiga-
tions. Id. at 6. The Court suggested that the government may
act in bad faith if it brings a civil action solely for the purpose
of obtaining evidence in a criminal prosecution and does not
advise the defendant of the planned use of evidence in a crim-
inal proceeding. Id. at 12-13. The Court thus distinguished the
Kordel investigation from bad faith cases where
the [g]overnment has brought a civil action solely to
obtain evidence for its criminal prosecution or has
failed to advise the defendant in its civil proceeding
that it contemplates his criminal prosecution; . . . [or]
any other special circumstances . . . might suggest
the unconstitutionality or even the impropriety of
this criminal prosecution.
Id. at 12-13.
[2] The Supreme Court has not had occasion to address
such issues since Kordel, but lower courts have. In SEC v.
UNITED STATES v. STRINGER 9721
Dresser Industries, Inc., the D.C. Circuit applied the princi-
ples laid down in Kordel to a case involving parallel SEC
civil and Department of Justice criminal investigations. See
628 F.2d 1368, 1376-77 (D.C. Cir. 1980) (en banc). The court
emphatically upheld the propriety of such parallel investiga-
tions. “Effective enforcement of the securities laws requires
that the SEC and Justice be able to investigate possible viola-
tions simultaneously.” Id. at 1377. The court said it would
refuse to bar such investigations absent unusual circum-
stances. Id. It said courts should refuse to “block parallel
investigations by these agencies in the absence of ‘special cir-
cumstances’ in which the nature of the proceedings demon-
strably prejudices substantial rights of the investigated party
or of the government.” Id.
District courts have occasionally suppressed evidence or
dismissed indictments on due process grounds where the gov-
ernment made affirmative misrepresentations or conducted a
civil investigation solely for purposes of advancing a criminal
case. See, e.g., United States v. Carriles, 486 F. Supp. 2d 599,
615, 619 (W.D. Tex. 2007), appeal pending, No. 07-50737
(5th Cir.); United States v. Rand, 308 F. Supp. 1231, 1233,
1237 (N.D. Ohio 1970).
In this case, the district court concluded that the govern-
ment should have told defendants of the criminal investigation
and that it violated the standards laid down in Kordel when
it failed to “advise defendants that it anticipated their criminal
prosecution.” Stringer, 408 F. Supp. 2d at 1088. It held that
the government engaged in “trickery and deceit” when the
SEC staff attorney instructed court reporters to refrain from
mentioning the AUSA’s involvement. When the SEC staff
attorney responded to Stringer’s attorney’s question, during
Stringer’s deposition, by directing him to the U.S. Attorney,
the district court concluded that the SEC attorney “evaded the
question.” Id. at 1089.
In its appeal, the government argues that it had no legal
duty to make any further disclosure of the existence of the
9722 UNITED STATES v. STRINGER
pending criminal investigation. It points to the warnings in
Form 1662 in which the government disclosed the possibility
of criminal prosecution, and it stresses that it did not make
any affirmative misrepresentations. It maintains the SEC
attorney’s answer was appropriate and truthful.
The defendants argue that the district court properly held
that the use of the evidence obtained by the SEC in a criminal
prosecution would violate defendants’ Fifth Amendment priv-
ilege against self-incrimination. The defendants were advised
that the evidence could be used in a criminal investigation,
but defendants did not invoke their Fifth Amendment privi-
lege during the SEC investigation. The government on appeal
correctly contends that defendants waived or forfeited their
Fifth Amendment right against self-incrimination.
[3] The privilege against self-incrimination protects an
individual from being forced to provide information that
might establish a direct link in a chain of evidence leading to
his conviction. Hoffman v. United States, 341 U.S. 479, 486
(1951). It may be waived if it is not affirmatively invoked. In
Minnesota v. Murphy, the Supreme Court stressed that the
privilege is lost if not affirmatively invoked, even if the
defendant did not make a knowing and intelligent waiver. 465
U.S. 420, 428 (1984). We have similarly stated that a “defen-
dant’s failure to invoke the privilege against self-
incrimination waives a later claim of privilege.” Unruh, 855
F.2d at 1374 (holding that a defendant waived the privilege
when, after being advised of his right not to answer questions,
he proceeded to testify in a civil deposition).
[4] The district court therefore erred in holding that defen-
dants’ waivers of the privilege were ineffective because they
were not told of the U.S. Attorney’s active involvement. See
Stringer, 408 F. Supp. 1089-90. The SEC Form 1662 used in
this case alerts SEC investigative witnesses that the informa-
tion can be used in a criminal proceeding. Defendants were on
sufficient notice, and so were their attorneys. As one federal
UNITED STATES v. STRINGER 9723
court has explained, all that was required was “sufficient
notice . . . that any information could be used against [them]
in a subsequent criminal proceeding.” United States v. Teyibo,
877 F. Supp. 846, 855 (S.D.N.Y. 1995). That court empha-
sized that “SEC Form 1662 stated in no uncertain terms that
the [g]overnment’s request for information could be refused
pursuant to the Fifth Amendment’s protection against com-
pelled self-incrimination.” Id. We agree.
[5] The SEC here went even further, warning each defen-
dant at the beginning of each deposition that “the facts devel-
oped in this investigation might constitute violations of . . .
criminal laws.” Nonetheless, defendants proceeded to testify
and failed to invoke their privilege against self-incrimination.
Defendants have forfeited any claims that the use of their tes-
timony against them in the criminal proceedings violates the
privilege against self-incrimination.
[6] The defendants next contend that the district court prop-
erly concluded that the government used the civil investiga-
tion solely to obtain evidence for a subsequent criminal
prosecution, in violation of due process. The Supreme Court
in Kordel made it clear that dual investigations must meet the
requirements of the Fifth Amendment Due Process Clause.
See 397 U.S. at 11-12. While holding that “[i]t would stultify
the enforcement of federal law” to curtail the government’s
discretion to conduct dual investigations strategically, the
Court suggested that a defendant may be entitled to a remedy
where “the [g]overnment has brought a civil action solely to
obtain evidence for its criminal prosecution.” 397 U.S. at 11-
12. In this case, the government argues that it did not violate
defendants’ due process rights because the civil investigation
was not commenced solely to obtain evidence for a criminal
prosecution.
[7] It is significant to our analysis that the SEC began its
civil investigation first and brought in the U.S. Attorney later.
This tends to negate any likelihood that the government began
9724 UNITED STATES v. STRINGER
the civil investigation in bad faith, as, for example, in order
to obtain evidence for a criminal prosecution. In United States
v. Unruh, 855 F.2d 1363, 1374 (9th Cir. 1987), we held that
a defendant was not entitled to dismissal of his indictment
when the U.S. Department of the Treasury instituted its inves-
tigation before any indictment and in order to file its own civil
complaint. See also United States v. Churchill, 483 F.2d 268,
272 (1st Cir. 1973); United States v. Teyibo, 877 F. Supp.
846, 855 (S.D.N.Y. 1995).
United States v. Carriles, 486 F. Supp. 2d 599, 619-21
(W.D. Tex. 2007), on the other hand, is a clear example of
government bad faith. The district court dismissed an indict-
ment because the U.S. Citizenship and Immigration Services
(“USCIS”) interviewed the defendant solely to collect evi-
dence in support of a criminal case against him. 486 F. Supp.
2d at 619-21. The defendant, a Cuban national, filed an appli-
cation for naturalization. Id. at 601. Although USCIS had
already determined that the defendant was not eligible for citi-
zenship, the agency nonetheless invited him to a pre-
citizenship interview in order to collect evidence for a crimi-
nal false statements case. Id. at 619. The interview protocol
was altered in so many ways to serve the needs of the criminal
investigation that it became an interrogation. The court
described the “interview” as follows:
(1) it lasted eight hours over the course of two days
as opposed to the usual maximum of thirty minutes,
(2) it involved two interviewers, (3) the
[g]overnment provided an interpreter, (4) there were
a total of four attorneys present—two defense attor-
neys and two Government attorneys, and (5) it was
both audio and videotaped.
Id. Because the “entire interview was . . . a pretext for a crimi-
nal investigation,” the district court dismissed the indictment.
Id. at 629-20.
 UNITED STATES v. STRINGER 9725
[8] Our case is not remotely similar to Carriles. In this case
the SEC’s civil investigation was opened first, led to SEC
sanctions and was conducted pursuant to the SEC’s own civil
enforcement jurisdiction. It was not a pretext for the USAO’s
criminal investigation of defendants. Congress has expressly
authorized the SEC to share information with the Department
of Justice to facilitate the investigation and prosecution of
crimes. See 15 U.S.C. §§ 77t(b), 78u(d). We must conclude
the SEC interviewed the defendants in support of a bona fide
civil investigation. There was no violation of due process.
[9] Defendant appellees finally contend that the district
court properly concluded that dismissal or, in the alternative,
suppression, was warranted because the government lulled the
defendants into turning over incriminating evidence by engag-
ing in “trickery and deceit.” It was dispositive for the district
court that the SEC staff attorney instructed court reporters to
refrain from mentioning the AUSA’s involvement and that the
SEC gave evasive answers to questions about the imminence
of a dual investigation. We have previously applied the Fourth
Amendment’s bar to unreasonable searches and seizures in
the context of dual investigations by the civil and criminal
branches of the IRS, where review of documentary evidence
is inherent in the investigation. We have thus held that a
search is unreasonable, even if consensual, if the consent is
obtained by trickery or deceit. See United States v. Robson,
477 F.2d 13, 18 (9th Cir. 1973). While not every SEC and
USAO dual investigation will necessarily involve a search
and seizure, to the extent that the individual defendants may
have been led through trickery or deceit to turn over docu-
mentary or physical evidence in their possession or to use
their official authority to turn over evidence in the possession
of the corporation, the defendants could state a claim under
the Fourth Amendment.
[10] A government official must not “affirmatively mis-
lead” the subject of parallel civil and criminal investigations
“into believing that the investigation is exclusively civil in
9726 UNITED STATES v. STRINGER
nature and will not lead to criminal charges.” Robson, 477
F.2d at 18. However, “we have consistently held that the fail-
ure of an IRS agent . . . to warn a taxpayer that an audit may
have potential criminal ramifications does not render the
search unreasonable.” Id. at 18-19 (denying suppression
where an IRS agent did not expressly advise a taxpayer that
the evidence the agent was gathering for a civil audit would
be used to support a criminal investigation).
[11] Other circuits have agreed that Fourth Amendment and
possible due process limitations may be implicated in a dual
investigation. See United States v. Peters, 153 F.3d 445, 451
(7th Cir. 1998) ( “A consensual search is unreasonable under
the Fourth Amendment or violative of due process under the
Fifth Amendment if the consent was induced by fraud, deceit,
trickery or misrepresentation.”). Almost every other circuit
has denied suppression, even when government agents did not
disclose the possibility or existence of a criminal investiga-
tion, so long as they made no affirmative misrepresentations.
See United States v. Irvine, 699 F.2d 43, 46 (1st Cir. 1983);
United States v. Sclafani, 265 F.2d 408, 414-415 (2d Cir.
1959); United States v. Parenti, 326 F. Supp. 717, 722 (E.D.
Pa. 1971), aff’d, 470 F.2d 1175 (3rd Cir. 1971); Groder v.
United States, 816 F.2d 139, 144 (4th Cir. 1987); United
States v. Prudden, 424 F.2d 1021, 1030 (5th Cir. 1970);
United States v. Marra, 481 F.2d 1196, 1203 (6th Cir. 1973);
United States v. Lehman, 468 F.2d 93, 105 (7th Cir. 1972);
United States v. Grunewald, 987 F.2d 531, 534 (8th Cir.
1993); United States v. Katz, 705 F.2d 1237, 1243 (10th Cir.
1983); United States v. Waugneux, 683 F.2d 1343, 1347 (11th
Cir. 1982); United States v. Stamp, 458 F.2d 759, 777 (D.C.
Cir. 1971).
The district court in this case relied on the Eighth Circuit’s
opinion in Grunewald, which said it would be a “flagrant dis-
regard of individuals’ rights” to “deliberately deceive, or even
lull” a person into incriminating themselves in a criminal
investigation being pursued under the guise of a civil one. 987
UNITED STATES v. STRINGER 9727
F.2d at 534. The Eighth Circuit was referring to the criminal
defendant’s argument that he was the victim of a criminal
investigation being pursued in the guise of a civil tax audit.
Id. The court rejected the argument and affirmed the district
court’s denial of suppression because there had been no
deceit. Id. We applied virtually the same standard in Robson,
where we held that suppression was not appropriate in the
absence of affirmative misrepresentations. 477 F.2d at 17-18.
[12] In this case, the SEC made no affirmative misrepresen-
tations. The SEC did advise defendants of the possibility of
criminal prosecution. The SEC engaged in no tricks to
deceive defendants into believing that the investigation was
exclusively civil in nature. The SEC’s Form 1662 explicitly
warned defendants that the civil investigation could lead to
criminal charges against them: “Information you give may be
used against you in any federal . . . civil or criminal proceed-
ing brought by the Commission or any other agency.” Defen-
dants were represented by counsel, and the government
provided counsel, so far as this record reflects, with accurate
information. The standard we laid down in Robson was not
violated.
The defendant-appellees point to a number of collateral
facts they argue demonstrate trickery or deliberate misleading.
They argue the SEC Staff Attorney affirmatively misled
Stringer’s attorney when, in response to the attorney’s ques-
tion about other agency involvement, she directed him to the
provision in Form 1662 that warned that the SEC would likely
turn over to the USAO evidence it collected at the deposi-
tions. The Staff Attorney, during the deposition taken in Port-
land, declined to direct defense counsel to a specific U.S.
Attorney’s Office, which would have been the Portland
Office, but there was nothing false or misleading in her
response that it was up to the defendant to decide where to
direct his inquiries.
[13] The defendant-appellees also point to the Staff Attor-
ney’s request to the court reporters not to mention the AUSA
9728 UNITED STATES v. STRINGER
in the presence of defendants’ attorneys. While this indicates
an intent to prevent disclosure to defendants of the actual
criminal investigation, the possibility of criminal investigation
should have been well known to both the defendants and their
counsel. The request to the court reporters to, in effect, mind
their own business did not mislead or misinform defendants
about the existence of an investigation. Thus, to the extent
that the Fourth Amendment may have been implicated by the
dual investigation, the district court erred in concluding that
the government’s actions in this case constituted an unreason-
able search or seizure.
B. Interference with Samper’s attorney-client
relationship
The district court concluded that the government violated
defendant Samper’s due process rights when it obtained evi-
dence about the “Swedish Drop Shipment” from Samper’s
attorney, knowing that she had a conflict of interest. Stringer,
408 F. Supp. 2d at 1092. The government argues that it did
not deliberately intrude into Samper’s attorney-client relation-
ship because all that it did was receive information that Sam-
per’s attorney offered the government, wholly independent of
any government conduct.
[14] We have held that “government interference with a
defendant’s relationship with his attorney may render coun-
sel’s assistance so ineffective as to violate . . . his Fifth
Amendment right to due process of law.” United States v.
Irwin, 612 F.2d 1182, 1185 (9th Cir. 1980). “ ‘[A] claim of
outrageous government conduct premised upon deliberate
intrusion into the attorney-client relationship will be cogniza-
ble where the defendant can point to actual and substantial
prejudice.’ ” United States v. Haynes, 216 F.3d 789, 797 (9th
Cir. 2000) (quoting United States v. Voigt, 89 F.3d 1050,
1067 (3d Cir. 1996)). A claim of government interference
with the attorney-client relationship has three elements: (1)
the government was objectively aware of an ongoing, per-
UNITED STATES v. STRINGER 9729
sonal attorney-client relationship; (2) the government deliber-
ately intruded into that relationship; and (3), as a result, the
defendant suffered actual and substantial prejudice. Voigt, 89
F.3d at 1067.
Most cases finding deliberate intrusion into the attorney-
client relationship involve government informants who some-
how penetrate the attorney-client relationship to obtain confi-
dential or privileged information, and then feed that
information to the government. See, e.g., Haynes, 216 F.3d at
793-94. In Haynes, the defendant’s attorney’s investigator
served as a paid informant for the government. Id. at 792. In
United States v. Marshank, 777 F. Supp. 1507, 1519-1520
(N.D. Cal. 1991), the defendant’s attorney served as an
unpaid informant for the government by providing the gov-
ernment confidential client information on a regular basis. In
contrast, we have held that the government’s asking a defen-
dant’s former attorney to turn over privileged information
does not constitute deliberate intrusion on the part of the gov-
ernment when the attorney complies. See United States v.
Rogers, 751 F.2d 1074, 1080 (9th Cir. 1985). “The fact that
the attorney failed to assert the ethical obligation does not
transform [the government’s] investigation into governmental
misconduct.” Id.
[15] For similar reasons, there was no deliberate govern-
ment interference here. The government did not deliberately
intrude into the relationship between Samper and Rosenbaum
when it accepted potentially incriminating evidence from
Rosenbaum, nor was Rosenbaum a government informant
whom the government sought out. Cf. Haynes, 216 F.3d at
793-94. In fact, in Form 1662, the government explicitly
warned Samper that “[y]ou may be represented by counsel
who also represents other persons involved in the Commis-
sion’s investigation. This multiple representation, however,
presents a potential conflict of interest if one client’s interests
are or may be adverse to another’s.” The conflict resulted
from Rosenbaum’s decision, wholly independent of the gov-
9730 UNITED STATES v. STRINGER
ernment, to represent FLIR and Samper. Samper had full
knowledge of a potential conflict and consented to the repre-
sentation. There was no impropriety on the government’s part.
[16] Indeed, had the government contacted Samper directly
to warn him about the conflict, bypassing his attorney, the
government would have engaged in conduct that itself may
have amounted to interference. Cf. Or. Rules of Prof’l Con-
duct R. 4.2; Model Rules of Prof’l Conduct R. 4.2. The gov-
ernment’s receipt of evidence from counsel intended to assist
one client, but that also tended to incriminate another, was not
an intrusion or intentional interference with the attorney-client
relationship and did not justify dismissal of the indictment or
suppression of the evidence of the “Swedish Drop Shipment.”
IV. Conclusion
For the foregoing reasons, we conclude that there was no
deception or affirmative misconduct on the part of the govern-
ment in the course of the SEC and U.S. Attorney investiga-
tions that warranted dismissal of the indictment or
suppression of any of the evidence in question. In addition,
defendants’ Fifth Amendment rights were not violated.
The panel shall retain jurisdiction over any subsequent
appeal in this matter.
The judgment of the district court dismissing the indictment
is VACATED. The district court’s suppression ruling is
REVERSED. The case is REMANDED for further proceed-
ings.