In Re: Application of the United States of America for Nondisclosure Order Pursuant to 18 U.S.C. 2705(b) for Grand Jury Subpoena Gj2014031022709 ( 2014 )

FILED
UNITED STATES DISTRICT COURT
FOR THE DISTRIC'I OF COLU'N[BIA C\EIR.U.S.D'|S!!?BI&BBBKIL!DIG§_'
courts for the D»s-trict of M|HMFP*#
IN THE MATTER OF THE
APPLICATION OF THE UNITED
STATES OF AMERICA FOR AN ORDER
OF NONDISCLOSURE PURSUANT TO
18 U.S.C. § 2705(b) FOR
GRAND JURY SUBPOENA
#GJ20l403l422709
Misc. Action No. 14-287
~a\.r`r\a`.u\¢`¢`y`r
MEMORANDUM OPINI ON
The government challenges two orders issued by Magistrate
Judge John Facciola regarding the government's application for
an order under 18 U.S.C. § 2705(b). The first order invited
Yahoo!, Inc. (“Yahoo”) to intervene as a respondent and file a
notice with the court on whether Yah0o intended to be heard on
the merits of the government’s application. The second order
instructed the government to file a public, redacted copy of its
application and draft order. Because the express terms of 18
U.S.C. § 2705(b) and applicable legal precedent governing public
access to grand jury proceedings and materials do not support
the first order inviting Yahoo to intervene or the second order
instructing the government to file a public, redacted copy of
the non-disclosure application, the orders will be vacated. In
addition, because the government has provided facts sufficient
to support issuing an order for delayed notice under 18 U.S.C.
..2_
§ 2705(b), the government's application for a non-disclosure
order will be granted, and the related court records will be
sealed under Rule 6(e) of the Federal Rules of Criminal
Procedure.
BACKGROUND
On March 20, 20l4, the government filed an application and
proposed order under 18 U.S.C. § 2705(b) for an order commanding
Yahoo not to notify any person of the existence or content of
grand jury subpoena #GJ2014031422709 for 90 days or until
further court order. The government also moved to seal the
application and proposed order under Rule 6(e) of the Federal
Rules of Criminal Procedure.
On March 24, 20l4, the magistrate judge issued an order
inviting Yahoo to intervene as a respondent and file a notice on
the public docket indicating whether Yahoo intended to be heard
on the merits of the government's application, In addition, the
magistrate judge ordered Yahoo not to disclose to any individual
outside of Yahoo information regarding the federal grand jury
subpoena. A second order, issued by the magistrate judge on the
same day, instructed the government to file a public, redacted
copy of its application for a non-disclosure order and proposed
order.
On March 27, 2014, the government filed what it styled as
an appeal from the magistrate judge's two orders regarding the
_3_
government's application for an order under 18 U.S.C. § 2705(b).
The government moved to vacate the orders issued by the
magistrate judge and moved for the district court to grant its
application for a nondisclosure order. In addition, the
government moved to seal the appeal and resulting order.
On that same day, Yahoo was ordered not to file during the
pendency of the appeal any notice on the public docket
indicating its intent to be heard on the merits of the
government's nondisclosure application, or any other filing.
The government's motion to seal was also granted.
DISCUSSION
I. JURISDICTION
The government cites Rule 58(g)(2) of the Federal Rules of
Criminal Procedure as authority for appealing. However, Rule
58(g)(2) pertains to “petty offenses and other misdemeanors.”
Fed. R. Crim. P. 58. The grand jury investigation here involves
a
felony
- Accordingly, Rule 58(g) (2) is inapposite. See, e.g.,
United States v. Bowman, 496 F.3d 685, 691 (D.C. Cir. 2007)
(“Rule 58, which is entitled ‘Petty Offenses and Other
Misdemeanors,’ applies only ‘in petty offense and other
misdemeanor cases and on appeal to a district judge in a case
tried by a magistrate judge.'” (quoting Fed. R. Crim. P.
58(a))). Because federal district courts are courts of limited
jurisdiction, see Kokkonen v. Guardian Life Ins. C0. of Am., 511
U.S. 375, 377 (1994); Commodity Futures Trading Comm'n v. Nahas,
738 F.2d 487, 491-92 (D.C. Cir. 1984), there must be an
alternative basis for jurisdiction to review the government's
challenge.1
Under section 636(b)(3) of the Federal Magistrate Act, 28
U S.C. §§ 631-639, district courts may assign federal magistrate
judges various judicial duties, provided that the assignment
does not violate the Constitution or other provision of federal
law. 28 U.S.C. § 636(b)(3); see Peretz v. United States, 501
U.S. 923, 924 (1991). Congress adopted subsection (b)(3) to
“enable[] the district courts to continue innovative
experimentations in the use of th[ese] judicial officer[s].”
H.R. Rep. No. 94-1609, at 12 (1976), reprinted in 1976
U.S.C.C.A.N. 6162, 6172. Furthermore, Congress noted that
“placing this authorization in an entirely separate subsection
1 The government styles its challenge as an appeal, but the
reference is a misnomer. With the exception of authority
granted by Federal Rule of Criminal Procedure 58 concerning
misdemeanor proceedings handled by a magistrate judge under 18
U.S.C. § 3401, the district court does not exercise appellate
power. See, e.g , United States v. Choi, 818 F. Supp. 2d 79, 85
(D.D.C. 2011) (“The magistrate judge is not an inferior court,
and the district court does not stand in an appellate capacity
over the magistrate.”). For the reasons explained below, the
government's appeal will be considered as an objection to the
magistrate judge’s two orders.
_5_
emphasizes that it is not restricted in any way by any other
specific grant of authority to magistrates ” §§; It has been
in accordance in part with § 636(b)(3) that the district court
has traditionally assigned to the magistrate judges all of the
government's applications for non-disclosure ordered
With respect to the question of jurisdiction, this
challenge appears to raise questions of first impression. Both
the Federal Rules of Criminal Procedure and the Local Criminal
Rules set forth clear procedures for objecting to a magistrate
judge's order, or report and recommendation, in pretrial
criminal matters referred to magistrate judges by the district
court under § 636(b)(1). §ee Fed. R. Crim P. 59(a), (b)(2);
LCrR 59.1(b); LCrR 59.2(b). By contrast, the procedure for.
objecting to orders issued in cases referred to magistrate
judges under § 636(b)(3) is not clearly defined in the Federal
Rules of Criminal Procedure or Local Criminal Rules.
Furthermore, although under the authority of section 636(b)(3)
and Local Criminal Rule 57.17(a)(5), the district court refers
to magistrate judges grand jury-related matters such as
applications for non-disclosure orders, those provisions make no
mention of the standard of review for objections made to
magistrate judges' orders.
However, case law discussing subsection (b)(3) does provide
some guidance. Existing precedent suggests that “additional
_5_
duties” delegated to magistrate judges under subsection (b)(3)
remain under the supervision and control of the district court
and accordingly, review by district courts of matters referred
to magistrate judges under section (b)(3) must be de n9yg. §§§
Mathews v. Weber, 423 U.S. 26l, 273 (1976) (noting that in cases
referred to the magistrate judge under subsection (b)(3), the
district court judge remains “free to give the magistrate's
recommendation whatever weight the judge decides it merits”); §§
re U.S. for an Order Pursuant to 18 U.S.C. Section 2703(d), 707
F.3d 283, 289 (4th Cir. 2013) (noting that decisions made by
magistrate judges under subsection (b)(3) are subject to de nQvg
review by the district court). Accordingly, the magistrate
judge's orders inviting Yahoo to intervene and commanding the
government to file a public, redacted copy of the application
for non-disclosure will be reviewed de n9yQ.
II. MEhITS
A. Order inviting Yahoo to intervene
Under 18 U.S.C. § 2703(c), the government may obtain a
court order to command a “provider of electronic communication
service or remote computing service”2 to disclose information
2 Yahoo is an.electronic communication service provider in
that it “provides to users . . . the ability to send or receive
wire or electronic communications.” 18 U.S C. § 2510(15); see
Yahoo Terms of Service, Yahoo!, https://info.yahoo.com/
legal/us/yahoo/utos/terms/ 11 2, 7 (last updated Mar. 16, 2012)
[hereinafter Yahoo Terms of Service] (describing Yahoo’s
_7_
regarding “a subscriber to or customer of such service." 18
U.S.C. § 2703(c)(2). When the government is acting under 18
U.S.C. § 2703, it may apply for a court order “commanding a
provider . . . to whom a warrant, subpoena, or court order is
directed, for such period as the court deems appropriate, not to
notify any other person of the existence of the warrant,
subpoena, or court 0rder.” 1§; § 2705(b). Upon application by
the government;
The court shall enter such an order if it determines
that there is reason to believe that notification of
the existence of the warrant, subpoena, or court order
will result in --
(1) endangering the life or physical safety of an
individual;
(2) flight from prosecution;
(3) destruction of or tampering with evidence;
(4) intimidation of potential witnesses; or
(5) otherwise seriously jeopardizing an
investigation or unduly delaying a trial.
“As in any statutory construction case, ‘[w]e start, of
course, with the statutory text,' and proceed from the
understanding that ‘[u]nless otherwise defined, statutory terms
are generally interpreted in accordance with their ordinary
meaning.'” Sebelius v. Cloer, 133 S. Ct. l886, 1893 (2013)
services). Yahoo is also a remote computing service because it
provides “to the public . . . computer storage or processing
services by means of an electronic communications system.” 18
U.S.C. § 2711(2); see Yahoo Terms of Service 1 13 (discussing
Yahoo's general practice regarding the use and storage of
electronic communications).
_3_
(quoting BP Am. Prod. Co. v. Burton, 549 U.S. 84, 91 (2006)).
The explicit terms of section 2705(b) make clear that if a
courts finds that there is reason to believe that notifying the
customer or subscriber of the court order or subpoena may lead
to one of the deleterious outcomes listed under § 2705(b), the
court must enter an order commanding a service provider to delay
notice to a customer for a period of time that the court
determines is appropriate. Once the government makes the
required showing under § 2705(b), the court is required to issue
the non-disclosure order.
The government contends that “Yahoo and other electronic
communication service providers and remote computing service
providers, can offer courts no information relevant or
meaningful to the criteria set forth in § 2705(b)(1)-(5)[.]”
Govt.’s Appeal from Mag. J.'s Order Regarding Govt.'s
Application for Order Pursuant to 18 U.S.C. § 2705(b) at 9.
However, section 2705(b) does not explicitly prohibit a court
from inviting a service provider to intervene and offer
arguments on the merits of the government's non-disclosure
application. lt is conceivable that the service provider may,
in some cases, have access to information that may be relevant
to whether the government has met the required showing under
§ 2705(b). However, nothing in the record or common experience
reflects that there would be information a service provider
_.9_.
could offer that would assist the court in assessing whether the
government has met the statutory showing. It is unlikely that
the service provider would be able to offer pertinent
information about whether notifying a subscriber or customer
about the existence or content of a grand jury subpoena will
endanger life or physical safety, or result in flight from
prosecution, destruction of, or tampering with, evidence, or
intimidation of potential witnesses, or will otherwise seriously
jeopardize an ongoing criminal investigation. Because the
government controls the scope of the criminal investigation, the
government is better equipped to provide information about
potential compromises to the ongoing criminal investigation than
is the service provider.
In addition, section 2705(b) includes no requirement that
the service provider be afforded an opportunity to intervene to
be heard on the merits of the government's application for a
non-disclosure order prrer re the court issuing the non-
disclosure order- Rather, the statute provides a separate
vehicle for service providers to challenge any court order to
disclose account records or other information. Under 18 U.S.C.
§ 2703, a service provider may move to quash or modify the non-
disclosure order only errer the court issues the non-disclosure
order. §ee re; § 2703(d) (“A court issuing an order pursuant to
this section, on a motion made promptly by the service provider,
_1g_
may quash or modify such order, if the information or records
requested are unusually voluminous in nature or compliance with
such order otherwise would cause an undue burden on such
provider ”). Accordingly, there is no statutory basis in the
record for an order inviting Yahoo to intervene to be heard on
the merits of the government's application.3
B. Order to file a redacted copy
“Unlike typical judicial proceedings, grand jury
proceedings and related matters operate under a strong
presumption of secrecy.” In re Sealed Case, 199 F.3d 522, 526
(D.C. Cir. 2000). Rule 6(e)(6) of the Federal Rules of Criminal
Procedure provides that “[r]ecords, orders, and subpoenas
relating to grand-jury proceedings must be kept under seal to
the extent and as long as necessary to prevent the unauthorized
disclosure of a matter occurring before a grand jury.” Fed. R.
Crim. P. 6(e)(6); see In re Grand Jury Subpoena, Judith Miller,
438 F.3d 1l38, 1139 (D.C. Cir. 2006). The Supreme Court has
“consistently recognized that the proper functioning of
our grand jury system depends upon the secrecy of grand jury
proceedings.” 'Douglas Oil Co. of Cal. v. Petrol Stops Nw., 441
U.S. 211, 218 (l979). Historically, the grand jury has
3 Nor does the order substantiate that any presumption of
public access to court documents overrides Congress' careful.
crafting of methods and timing for challenging non-public non-
disclosure orders about non-public grand jury subpoenas.
...:Ll_.
conducted its business outside of the purview of the public. §§
re Motions of Dow Jones & Co., 142 F.3d 496, 499 (D.C. Cir.
l998) (“A grand jury is a body that conducts its business in
private. The Framers knew this as well as we do. ‘Since the
17th century, grand jury proceedings have been closed to the
public, and records of such proceedings have been kept from the
public eye.’” (quoting Douglas Oil Co., 441 U.S. at 218-19
n.9)). Maintaining the confidentiality of grand jury
proceedings and records protects the integrity of grand jury
investigations. See, e.g., In re Grand Jury Subpoena, Judith
Miller, 493 F.zd 152, 154 (D.C. cir. 2007) (“srarid jury
investigations are conducted in strict secrecy to encourage
witnesses to testify ‘fully and frankly,' to prevent those about
to be indicted from fleeing, and to ensure that ‘persons who are
accused but exonerated by the grand jury will not be held up to
public ridicule.'” (quoting Douglas Oil Co., 441 U.S. at 219)).
It is generally true that there is a presumption of public
access to court records. The First Amendment or the common law
provides the legal basis for the public's right of access to
court records, depending on the particular court records at
issue. The First Amendment guarantees the public the right to
access certain proceedings and records “if such access has
historically been available, and serves an important function of
monitoring prosecutorial or judicial misconduct.” Washington
_12_
Post v. Robinson, 935 F.2d 282, 288 (D.C. Cir. 1991) (citing
Press-Enter. Co. v. Super. Ct., 478 U.S. 1, 8 (1986); §lebe
Newspaper Co. v. Super. Ct., 457 U.S. 596, 605-06 (1982)).
Furthermore, common law provides a “strong presumption in favor
of public access to judicial proceedings.” EEOC v. Nat{l
Children’S Ctr., InC., 98 F.3d l406, 1409 (D;C. Cir. 1996)
(quoting Johnson v. Greater Se. Cmty. Hosp. Corp., 951 F.2d
l268, 1277 (D.C. Cir. 1991)). Under current D.C. Circuit case
law, the presumption of public access to court records must be
weighed against the privacy interests asserted by the party
opposing public disclosure. The factors the D.C. Circuit
outlined in United States v. Hubbard, 650 F.2d 293, 317-22 (D.C.
Cir. 198O),4 serve to guide a court in determining whether to
seal court records where there is a common law right of access.
There is neither a First Amendment right nor a common law
right of access to the government's non-disclosure application
and proposed order. As the D.C. Circuit has held, there is no
4 The Hubbard factors include:
(1) the need for public access to the documents at
issue; (2) the extent of previous public access to the
documents; (3) the fact that someone has objected to
disclosure, and the identity of that person; (4) the
strength of any property and privacy interests
asserted; (5) the possibility of prejudice to those
opposing disclosure; and (6) the purposes for which
the documents were introduced during the judicial
proceedings,
Hubbard, 650 F.zd at 317~22_
_.13_
First Amendment right of access to grand jury materials,
including “ancillary materials” related to ongoing grand jury
investigations. Judith Miller, 493 F.3d at 154 (“Although
public access plays an important role in other aspects of the
judicial process, ‘there is no First Amendment right of access
to grand jury proceedings,' nor do First Amendment protections
extend to ancillary materials dealing with grand jury
matters[.]” (quoting Dow Jones, 142 F.3d at 499)). The court
filings that the government seeks to seal are er peree
applications and orders relating to an ongoing, confidential,
criminal investigation by a federal grand jury. Therefore, the
government's application and proposed order are protected from
disclosure under Rule 6(e) as ancillary materials related to an
ongoing grand jury investigation, and there is no First
Amendment right of public access to these court records.
Similarly, there is no common law right of access to grand
jury-related materials. See, e.g., In re Sealed Case, 199 F.3d
522, 526 (D.C. Cir. 2000) (“There is a plethora of authority
recognizing that the grand jury context presents an unusual
setting where privacy and secrecy are the norm.”); Dow Jones,
142 F.3d at 504 (“Although some have identified a common law
tradition of public access to criminal trials, this never
extended to preindictment, pretrial proceedings involving a
grand jury.”). Therefore, although there is a general
_l4_
presumption of public access to court records under common law,
this presumption does not apply to materials related to ongoing,
federal grand jury investigations.
C. Application for Non-Discl0sure Order
The government has met the showing required for a court to
issue an order for delayed notice under 18 U.S.C. § 2705(b).
The government proffered that it is “aware that, absent a court
order under 18 U.S.C. § 2705(b),” Yahoo's “practice and policy”
is to “notify the subscriber or customer of the existence of the
subpoena . . . .”_ Application for Order Commanding Yahoo!, Inc.
Not to Notify Any Person of the Existence of Grand Jury Subpoena
1 4. In light of what the government proffers to be Yahoo's
existing policy and practice, there is “reason to believe” that
notifying the public of the existence of the subpoena and non-
disclosure order will result in at least “destruction of or
tampering with evidence,” or “otherwise seriously jeopardizing
an investigation.” 18 U.S.C. § 2705(b). Accordingly, the
'government’s application for a non-disclosure order will be
granted under § 2705(b)_
CONCLUSION
The orders inviting Yahoo to intervene and instructing the
government to file a public, redacted copy of the non-disclosure
application are not supported by the text of 18 U.S.C.
_]_5_
§ 2705(b), Rule 6(e) of the Federal Rules of Criminal Procedure,
or the applicable D.C. Circuit precedent regarding access to
grand jury-related materials. Accordingly, the magistrate
judge's orders will be vacated. Because the government has met
its required showing under § 2705(b), the government's
application for a non-disclosure order will be granted, and the
government's request to seal the application and resulting order
under Rule 6(e)(6) of the Federal Rules of Criminal Procedure
will be granted. Separate orders accompany this memorandum
opinion.
Z'gi¢\
SIGNED this day of April, 2014.
/@ z
RICHARD W. ROBERTS
Chief Judge
U.S. District and Bankruptc'y Qourts
for the District of Columb
A T UE COP
ANGELA .CAESA oak
B`y __ ./l