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In re Search Warrant Issued June 13

United States Court of Appeals, Fourth Circuit

October 31, 2019

In re: SEARCH WARRANT ISSUED JUNE 13, 2019
v.
UNDER SEAL, Defendant-Appellant. UNITED STATES OF AMERICA, Plaintiff - Appellee,

          Argued: September 10, 2019

          Appeal from the United States District Court for the District of Maryland, at Baltimore. Liam O'Grady, District Judge. (1:19-mj-02155-TCB-1)

          ARGUED: James Patrick Ulwick, KRAMON & GRAHAM, P.A., Baltimore, Maryland, for Appellant. Derek Edward Hines, OFFICE OF THE UNITED STATES ATTORNEY, Baltimore, Maryland, for Appellee.

          ON BRIEF: Steven M. Klepper, Louis P. Malick, KRAMON & GRAHAM, P.A., Baltimore, Maryland, for Appellant. Robert K. Hur, United States Attorney, Aaron S.J. Zelinsky, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Baltimore, Maryland, for Appellee.

          Before GREGORY, Chief Judge, and KING and RUSHING, Circuit Judges.

          KING, Circuit Judge

         The appellant in these proceedings is a Baltimore law firm (the "Law Firm") that challenges the government's use of a so-called "Filter Team" - created ex parte by a magistrate judge in the District of Maryland and comprised of federal agents and prosecutors - to inspect privileged attorney-client materials. Those materials were seized from the Law Firm in June 2019 during the execution of a search warrant issued by the magistrate judge. The Law Firm requested that the district court enjoin the Filter Team's review of the seized materials, invoking the attorney-client privilege and the work-product doctrine. When the court denied its request, the Law Firm pursued this appeal. As explained below, we are satisfied that use of the Filter Team is improper for several reasons, including that, inter alia, the Team's creation inappropriately assigned judicial functions to the executive branch, the Team was approved in ex parte proceedings prior to the search and seizures, and the use of the Team contravenes foundational principles that protect attorney-client relationships. We therefore reverse and remand.

         I.

         A.

         1. For about three years, "Lawyer A," a partner of the Law Firm, handled the representation of "Client A" in an investigation conducted by federal authorities in Maryland.[1] Client A - who is also a Maryland lawyer - was suspected of assisting drug dealers in illicit activities, including money laundering and obstruction of federal investigations. According to the government, its investigation of Client A was obstructed by Lawyer A, and the relationship between Lawyer A and Client A triggered an application of the crime-fraud exception to the attorney-client privilege and work-product doctrine. In light of Lawyer A's suspected misconduct, the government also initiated an investigation of Lawyer A.

         As part of those investigative efforts, an IRS agent applied for a warrant to conduct a search of the Law Firm's Baltimore offices. On June 13, 2019, the magistrate judge approved the search warrant application and issued the warrant as requested. Based on her review of the supporting affidavit of the IRS agent, the judge found probable cause for the search of the Law Firm and the seizures of client-related materials concerning Lawyer A's representation of Client A.

         2.

         Contemporaneously with issuance of the search warrant, the magistrate judge authorized the Filter Team, which had been proposed to the judge ex parte by the prosecutors in connection with the search warrant application. In so doing, the judge adopted the "Filter Team Practices and Procedures" specified in an attachment to the search warrant application and affidavit (the "Filter Protocol"). See S.J.A. 41-45.[2] The Filter Protocol defined the membership of the Filter Team and established the process for its review of the materials to be thereafter seized from the Law Firm. Members of the Filter Team included lawyers from the United States Attorney's Office in Maryland's Greenbelt Division (the "Filter Team AUSAs"); a legal assistant and a paralegal who also worked there; agents of the IRS and DEA; and forensic examiners. The Filter Team operated in one of the two offices of Maryland's United States Attorney - the Greenbelt office.

         Pursuant to the Filter Protocol, the Filter Team members were not involved in the investigations of Lawyer A and Client A (apart from being Filter Team members). The agents and prosecutors conducting the investigations of Lawyer A and Client A (the "Prosecution Team") were excluded from the Filter Team. In contrast to the Filter Team AUSAs who were assigned to the Greenbelt office, the Prosecution Team lawyers were assigned to the United States Attorney's Baltimore office.

         As for the Filter Team's process of reviewing attorney-client materials seized from the Law Firm, the Filter Protocol provided for privilege issues to be handled thusly:

• After seizing materials from the Law Firm, the Filter Team would identify and separate privileged and potentially privileged materials from materials that were not privileged. Under the Filter Protocol, privileged materials included "attorney-client information, attorney work product information, and client confidences that have not been waived," see S.J.A. 43, 45;
• When seized materials were found by the Filter Team to be nonprivileged, the Filter Team AUSAs could forward such materials directly to the Prosecution Team, without the consent of the Law Firm or a court order (the "Privilege Assessment Provision");
• For privileged and potentially privileged materials, the Filter Team would decide whether any such seized materials were "responsive to the search warrant," id. at 44;
• For privileged and potentially privileged materials that were "responsive to the search warrant," id., the Filter Team AUSAs would place them in one of three categories:
1. Seized materials that were privileged and could not be redacted;
2. Seized materials that were privileged but could be redacted; or
3. Seized materials that were potentially privileged (for example, when the Filter Team identified some possible exception, such as the crime-fraud exception, to a claim of privilege);
• After providing copies to counsel for Lawyer A of the seized materials identified as within categories 2 and 3, the Filter Team AUSAs would seek an agreement with counsel for Lawyer A concerning whether those materials could be forwarded to the Prosecution Team; and
• If the Filter Team AUSAs and counsel for Lawyer A disagreed on the handling of seized materials, the Filter Team AUSAs would submit such "items to the court for [a] determination regarding privilege and/or proposed redactions of the privileged material," id.

         The Filter Protocol also authorized the Filter Team to provide the Prosecution Team with seized materials if a Filter Team member "obtain[ed] [a] waiver[] of the attorney-client privilege" by directly contacting the Law Firm client holding the privilege. See S.J.A. 42. Under the Protocol, "[i]f a client waive[d] the attorney-client privilege as to files, no further filter review of [those] files . . . for attorney-client privileged material [was] required." Id.

         3.

         Five days after the magistrate judge issued the search warrant, on June 18, 2019, fifteen IRS and DEA agents - who were members of the Filter Team - executed the warrant by conducting a six-hour search of the Law Firm's offices. Those agents seized voluminous materials, including certain "confidential, privileged documents" of the Law Firm concerning, inter alia, Lawyer A's representation of Client A. See S.J.A. 66. For example, the agents electronically copied and seized the contents of Lawyer A's iPhone and computer. The electronically seized materials contained all of Lawyer A's email correspondence, including email correspondence related to Client A and numerous other Law Firm clients.[3] More specifically, Lawyer A's seized email inbox contained approximately 37, 000 emails, of which 62 were from Client A or contained Client A's surname. And Lawyer A's seized email "sent items" folder contained approximately 15, 000 emails, of which 54 had been sent to Client A or contained Client A's surname. Id. at 80.[4] An "extensive" portion of the seized emails were "from other [Law Firm] attorneys concerning . . . other attorneys' clients that have no connection with th[e] investigation[s]" of Lawyer A and Client A. Id. at 66. Notably, some of those Law Firm clients "are being investigated by, or are being prosecuted by, the United States Attorney's Office [for the District of Maryland] for unrelated crimes." Id.[5]

         During the execution of the search warrant by the IRS and DEA on June 18, 2019, various Law Firm partners voiced objections, including to the breadth of the search and seizures. Those objections were made directly to the federal agents conducting the search, and were also made to at least two prosecutors, including a member of the Prosecution Team. A Law Firm partner specifically requested that the government's forensic examiners limit their seizures of Lawyer A's emails to those that included Client A's name or other relevant search terms. Those requests were all rejected.[6]

         By letter delivered to the United States Attorney on June 21, 2019, the Law Firm asserted that the search and seizures contravened the Constitution, Federal Rules of Criminal Procedure, and United States Attorneys' Manual. Additionally, the Law Firm advised the government that the Firm had a duty "to preserve client confidences and secrets," see S.J.A. 71, and that it was "ethically mandated to urge the return of all items seized by the government," id. at 72. The Law Firm's letter objected to the use of the Filter Team and requested that the government return the seized materials so that the Firm could conduct a privilege review - which would have been the process had the government used subpoenaes duces tecum rather than a search warrant. The Law Firm also requested that the government not examine any of the seized materials until the Firm had an opportunity to complete its privilege review. Alternatively, the Law Firm asked the government to immediately submit the seized materials to the magistrate judge or the district court for in camera inspection. The government never responded to the Law Firm's letter.

         B.

         On June 26, 2019, Client A - whose own office had also been searched by federal agents and whose files were seized - moved in the district court for relief from the Filter Protocol, which also applied to that search. The following day, the court ordered that the Filter Team not deliver to the Prosecution Team any materials that were seized from Client A and the Law Firm, pending further order of the court.[7]

         On June 28, 2019, the Law Firm separately moved in the district court for injunctive relief. More specifically, the Law Firm sought a temporary restraining order and a preliminary injunction, pursuant to Rule 65 of the Federal Rules of Civil Procedure, and the return of seized property, pursuant to Rule 41(g) of the Federal Rules of Criminal Procedure (collectively, the "Injunction Requests"). On July 1, 2019, the government responded to and opposed the Law Firm's Injunction Requests. The Law Firm replied the very next day.

         Eight days later, on July 10, 2019, the district court conducted a telephonic hearing on the Injunction Requests.[8] During that hearing, the Law Firm's counsel explained that the Law Firm had more than twenty lawyers, and he described the Firm's extensive and ongoing law practice in Maryland, including its involvement in a vast amount of criminal and civil litigation and related legal services. Counsel emphasized to the court that Lawyer A's entire email file had been copied and seized by the federal agents and that the file contained privileged communications with and between various lawyers and clients of the Law Firm concerning criminal and civil matters unrelated to the investigations of Lawyer A and Client A. Counsel advised the court that the Law Firm had conducted a search of Lawyer A's emails using Client A's surname and identified only 116 responsive emails in the approximately 52, 000 emails that were seized from Lawyer A's email file. The Law Firm's counsel emphasized his objections to any use of a government filter team and argued that the Filter Protocol approved by the magistrate judge was fatally flawed. He stressed the Filter Protocol's illegality as to all clients of the Law Firm. Counsel added that the Filter Team would have access to and would be reviewing seized materials related to Law Firm clients that the Filter Team members could be investigating, or might thereby become interested in investigating.

         The government responded that the Filter Team AUSAs had asked the Law Firm for a list of clients with pending matters in the United States Attorney's Office, in order to confirm that no Filter Team member was involved in such matters.[9] The Law Firm, however, declined to provide that information. The government represented that it had no alternative but to seize Lawyer A's entire email file because an onsite review was impractical. The government also argued that, if it had provided search terms to the Law Firm, those terms would have revealed what the government was searching for, and those revelations might have allowed Lawyer A to obstruct its investigations. In addition, the government claimed that using search terms might cause the Filter Team to overlook emails relevant to the investigations.

         At the conclusion of the telephonic hearing of July 10, 2019, the district court orally denied the Law Firm's Injunction Requests, ruling that the Firm had not shown "any likelihood of irreparable harm." See S.J.A. 122. The court related that "filter teams can be neutral," and that this Filter Team was "operating under the [c]ourt's direction." Id. at 120. The court observed that, "absent a finding that there has been some breach of [the prosecutors'] ethical responsibilities and duties in this case, which rarely occurs," the Filter Protocol was not "inappropriate." Id. at 121. Additionally, the court related that "having an independent group" of prosecutors review the seized materials did not "create[] great risk or create[] the appearance of unfairness." Id. The court said there was no "per se rule that law firms are to be treated so differently that neutral examiners must be appointed in every case." Id. Finally, the court remarked that the Law Firm had "delay[ed] in coming to the [c]ourt," and stated that the Filter Team had made substantial progress in reviewing the seized materials. Id. at 122.

         On July 11, 2019 - the day after the hearing - the district court entered an order denying the Injunction Requests because the Law Firm had not established that it would suffer irreparable harm absent injunctive relief. See In re Search of Under Seal, No. 1:19-mj-02155 (D. Md. July 11, 2019), ECF No. 11 (the "Denial Order"). The Denial Order stated, in part:

In reviewing the search warrant, the [m]agistrate [j]udge knew that the search was to be of [a] law firm[] and imposed appropriate and well-established constraints on the [Filter Team] that would be reviewing the seized documents. There is no inherent conflict in having the seized documents reviewed by [the Filter Team] composed of Assistant United States Attorneys who have no connection to the underlying case or [the Law Firm] and no contact with the [Prosecution Team] on this case. . . . As a result, the [c]ourt finds that the limits in the search warrant and the constraints imposed on the [Filter Team] are such that the appointment of a special master or magistrate judge is not necessary to protect [the Law Firm] or its clients from irreparable harm.

Id. at 2.

         Later that day, the Law Firm noted this appeal, pursuant to 28 U.S.C. § 1292(a)(1). That jurisdictional provision authorizes appellate review of a district court's decision denying injunctive relief.

         On July 17, 2019, after the Law Firm's appeal was lodged, the district court entered an agreed order modifying the Privilege Assessment Provision of the Filter Protocol. Specifically, the court altered that Provision to require that the Filter Team's forwarding of seized materials to the Prosecution Team be first approved by the Law Firm or by the court (the "Modified Privilege Assessment Provision"). Prior to that modification, the Privilege Assessment ...


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