
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 97-1693                              UNITED STATES OF AMERICA,                                      Appellant,                                          v.                                  STEPHEN M. RAKES,                                 Defendant, Appellee.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                   [Hon. Reginald C. Lindsay, U.S. District Judge]                                              ___________________                                 ____________________                                        Before                                 Selya, Circuit Judge,                                        _____________                            Aldrich, Senior Circuit Judge,                                     ____________________                              and Boudin, Circuit Judge.                                          _____________                                 ____________________            Richard L.  Hoffman, Assistant United  States Attorney,  with whom            ___________________        Donald K.  Stern,  United  States  Attorney,  and  James  D.  Herbert,        ________________                                   __________________        Assistant United States Attorney, were on brief for the United States.            Michael  F. Connolly  with whom  Francis  X. Bellotti,  Valerie B.            ____________________             ____________________   __________        Robin and Mintz, Levin, Cohn, Ferris,  Glovsky and Popeo, P.C. were on        _____     ____________________________________________________        brief for appellee.                                 ____________________                                  February 11, 1998                                 ____________________                 BOUDIN, Circuit Judge.   In May 1996, Stephen  Rakes was                         _____________            indicted by a federal grand jury and charged with perjury and            obstruction of justice.  Prior to trial, Stephen Rakes  moved            to  suppress conversations between  him and his  former wife,            Julie Rakes, and between him and his one-time  attorney, John            P.  Sullivan.  The district  court granted the motion, except            for one conversation, and the government now appeals.                 The  facts are readily  gleaned from testimony  taken by            Judge  Lindsay in  an  in  camera hearing  on  the motion  to                                   __________            suppress.1  Stephen and Julie  Rakes were married in 1978 and            engaged in various business ventures together.  In 1983, with            the help  of their attorney, John Sullivan,  the Rakes couple            established  a  corporation  named Stippo's,  Inc.,  as their            jointly owned company to operate a liquor store business at a            site  on Old Colony Avenue in South Boston.  The store opened            shortly before Christmas 1983.                 The  government believes that  not long  thereafter, the            Rakeses were threatened by unnamed people in South Boston who            were  angry that  the Rakeses were  underpricing competitors.            Then, in  early January  1994, the  government believes  that            James "Whitey"  Bulger visited  Stephen Rakes  at home  while            Julie was at the liquor  store and threatened to kill Stephen                                            ____________________                 1The hearing  was conducted  in camera  to avoid  public                                              _________            disclosure of the  assertedly privileged  materials, and  the            briefs  in this  court  have  been filed  under  seal.   This            opinion  was filed  under seal  and the  parties, having  now            reviewed it, have no objection to its publication.                                         -2-                                         -2-            unless Bulger  or his  associates were made  partners in  the            liquor  store.   By May  1984, again  with the  assistance of            Sullivan, the  Rakeses  had transferred  Stippo's,  Inc.,  to            another   individual,  whom   the  government   believes  was            associated with Bulger, for a fraction of what the government            says was its real value.                 In  May  1991,  the government  summoned  Stephen  Rakes            before a  federal grand  jury in  Massachusetts investigating            extortion, racketeering and money laundering.  The government            questioned Rakes about the transfer of Stippo's, Inc., to the            alleged Bulger associate.   Rakes testified that  he had sold            the store to make a profit and  because it was too much work,            and said that no one had threatened him to make him  sell the            store.                 In September 1995, Stephen  Rakes gave similar testimony            before   a  second  federal  grand  jury.    Thereafter,  the            government  called Julie Rakes  and Sullivan before  the same            grand jury.   Although Sullivan initially refused  to discuss            his   conversations  with   Stephen  and  Julie   Rakes,  the            government secured  an order  from district judge  compelling            Sullivan's testimony.  Stephen Rakes was not advised that the            proceedings to compel Sullivan's testimony were under way.                 In  May 1996,  the grand  jury  indicted Stephen  Rakes,            charging him with  five counts of perjury based  on his grand            jury  testimony,  18  U.S.C.     1623,  and   two  counts  of                                         -3-                                         -3-            obstruction of  justice, 18  U.S.C.    1503; the  obstruction            counts  charged that  Rakes' grand  jury  testimony had  been            false and intended to obstruct  the grand jury.  Three counts            of the indictment were later dismissed as multiplicitious but            four others remain pending.                 Asserting   the  privilege   for  confidential   marital            communications, Stephen  Rakes moved to suppress  evidence of            conversations in December  1983 and January 1984  between him            and Julie Rakes  concerning alleged threats  and the sale  of            Stippo's.  He also asked the court to suppress, on grounds of            attorney-client  privilege,  conversations   between  Stephen            Rakes  or both  Rakeses and Sullivan  concerning the  sale of            Stippo's, Inc.  and the  purpose of the  sale.   The district            court held four days of hearings on the motion.                 In April 1997, the district court granted Stephen Rakes'            motion with  one exception:  it  denied the motion as  to one            conversation between  Stephen  and  Julie  Rakes,  apparently            because it took place in the presence  of a third party.  The            district court identified the materials to be suppressed but,            presumably  because of the  risk of disclosure  of privileged            information,  did  not  write a  supporting  opinion  or make            separate findings of fact.   The government then brought this            interlocutory appeal.  See 18 U.S.C.   3731.                                   ___                 We  will assume arguendo the relevance of the suppressed                                 ________            conversations to the  government's prosecution.  At  the same                                         -4-                                         -4-            time, most of  the formal requisites for  the attorney-client            and marital communications  privileges are  clearly met;  the            government's main claim is that the privileges were waived or            forfeited.  In a federal criminal case, privileges take their            content from the common law as it may be altered from time to            time in  the light of  reason and experience.   Fed. R. Evid.            501.      No   brief   version    of   either   the   marital            communications  or  attorney-client  privilege  can  be  both            complete and accurate.   But, broadly  stated and subject  to            exceptions, the  former  privilege permits  an individual  to            refuse to testify,  and to prevent a spouse  or former spouse            from testifying, as to any confidential communication made by            the individual  to the  spouse during  their marriage.2   The            latter  privilege, again  with  exceptions,  protects at  the            client's  behest confidential  communications between  lawyer            and client made to facilitate legal services for the client.3                 The communications  suppressed  by  the  district  court            between Stephen and  Julie Rakes were made in  the absence of            third parties and  in the course of their  marriage; that the                                            ____________________                 2See, e.g.,  Unif. R. Evid.  504(a); J. Strong,  et al.,                  ___  ____            McCormick on Evidence    78-86 (4th ed. 1992); Blau v. United            _____________________                          ____    ______            States, 340 U.S. 332 (1951).  The separate marital privilege-            ______            -to refuse to testify against a spouse in a criminal case--is            not pertinent here.   Trammel v. United States,  445 U.S. 40,                                  _______    _____________            51 (1980).                 3Unif. R. Evid.  502(b); McCormick    87-97;  Upjohn Co.                                          _________            __________            v. United States,  449 U.S. 383, 389-90 (1981); United States               _____________                                _____________            v.  United Shoe  Machinery Corp.,  89 F.  Supp. 357,  358 (D.                ____________________________            Mass. 1950) (Wyzanski, J.).                                         -5-                                         -5-            Rakeses  later divorced  is  irrelevant,  and the  government            properly makes  nothing of  the possibility  that one  of the            conversations  occurred  in  the  presence  of  their  infant            children.    Similarly,  Stephen Rakes'  communications  with            Sullivan  were   made  during   the   course  of   Sullivan's            representation of Rakes  and were related to  legal services,            and no one was present except one or both of the  Rakeses and            attorney Sullivan.                   Both  the  content  and  context of  the  communications            support the implicit finding by the district judge that Rakes            intended  his conversations,  with  both  his  wife  and  his            attorney, to be confidential.  Further, if Stephen Rakes  had            been  threatened, as  the government  alleges,  he had  ample            reason over  and above any  ordinary interest  in privacy  to            want them to be kept confidential.  We reserve for discussion            below  the  government's  claim  that  later  disclosures  by                                                   _____            Stephen Rakes undermine the claim of confidentiality.                 The government suggests that some general rule  deprives            spousal  conversations of  the privilege  if  they relate  to            financial matters;  needless to  say, it  does not  make this            claim  in  respect  to the  attorney-client  privilege.   The            marital communications privilege contains no such limitation:            the cases  say,  at  most,  that a  discussion  of  financial            matters between  husband and wife  may not be intended  to be            confidential.   E.g., In  re Witness  Before Grand  Jury, 791                            ____  __________________________________                                         -6-                                         -6-            F.2d  234, 239 (2d  Cir. 1986).   In this case,  however, the            subjectwas manifestlysensitive,albeit notforthe usualreasons.                 Nor  do we agree  with the government's  suggestion that            communications were  not privileged insofar  as Stephen Rakes            may have been relating to his wife events that occurred prior            to  the  communication.   It  is  true  that "communications"            privileges typically prevent  inquiry into communications and            not into the underlying  facts, Upjohn Co. v. United  States,                                            __________    ______________            449 U.S. 383,  395-96 (1981),  although the  subject is  more            complicated than  this  generalization suggests.4    But  the            district  court's   suppression   order   was   directed   to            communications, not to facts, and that is enough for  present            purposes.                 This brings  us to the  main thrust of  the government's            argument, namely, that  "[t]he suppressed communications  are            not  privileged  because  they  occurred  during  an  ongoing            extortion   scheme."    A   crime  of  extortion,   says  the            government,  extends  from  the  initial  threat  through the            actual  obtaining  of   the  property.    See  18   U.S.C.                                                         ___            1951(b)(2); United States v. Bucci, 839 F.2d 825, 829-30 (1st                        _____________    _____            Cir.  1988).    Here,  the  government  says  that  the crime                                            ____________________                 4Where  an attorney knows  facts only because  they were            confidentially  communicated by  the  client, the  government            cannot  circumvent the privilege by asking the attorney about            "the facts."   See Upjohn, 449  U.S. at 395.   The same  rule                           ___ ______            applies to the  marital communications privilege.   Blau, 340                                                                ____            U.S. at 333.                                         -7-                                         -7-            extended  from  the  first alleged  threat  in  December 1983            through the completion of the  property transfer in May 1984,            a period embracing all but one of the communications that the            government seeks to use.                 No   general   rule   withdraws   the   privilege   from            communications that occur  in the same time frame as criminal            act conduct.  See In re Grand Jury Subpoenas Duces Tecum, 798                          ___ ______________________________________            F.2d 32, 34 (2d Cir. 1986).  But both the privileges involved            here  are  subject  to some  type  of  crime-fraud exception.            Thus,  the attorney-client privilege  is forfeited inter alia                                                               __________            where the client sought the  services of the lawyer to enable            or  aid  the  client  to  commit  what  the  client  knew  or            reasonably  should have known to be a  crime or fraud.  E.g.,                                                                    ____            Unif. R. Evid. 502(d)(1); McCormick, supra,   95.                                      _________  _____                 The  counterpart  limitation  in  the  case  of  marital            communications is not necessarily identical;  it is expressed            in somewhat  different  terms  in  different  jurisdictions.5            However, we  will assume for  present purposes--favorably  to            the government--that the privilege for marital communications                                            ____________________                 5See, e.g., Unif.  R. Evid. 504(c); McCormick,  supra,                    ___  ____                          _________   _____            78.   In federal courts, the marital communications privilege            typically is forfeited  only where both husband  and wife are            jointly engaged in criminal  activity or where the  victim is            the other  spouse or  some other family  member.   See United                                                               ___ ______            States v.  Picciandra, 788  F.2d 39, 43-44  (1st Cir.  1986);            ______     __________            United  States v.  Mavroules, 813  F. Supp.  115,  119-20 (D.            ______________     _________            Mass. 1993).                                         -8-                                         -8-            would be lost to Stephen  Rakes if he made the communications            in question to Julie for the purpose of carrying out a crime.                 The government  concedes  that Stephen  and Julie  Rakes            were the "victims" of an extortion scheme.  But to invoke the            crime-fraud exception, the government also says (the emphasis            is  ours) that "the communications suppressed by the District            Court  occurred  while  the  Rakeses  were  participating  in                                    _____________________________________            carrying out the [extortion]  scheme and covering it up,  and            ____________________________________            while Stephen was persuading Julie to do so."  This, says the            government, entails loss of the privilege.                 Yet,  on the  government's own  version  of events,  the            Rakeses  were  not  participants  in  the  extortion  in  any            capacity  other  than  that  of victim.    The  Rakeses  were            participants  only in  the very  specialized  sense that  the            victim of a robbery "participates" by handing over his wallet            under   threat  of  violence,   or  the  victim   of  a  rape            "participates"  by   offering  no  further   resistance  when            resistance appears futile or dangerous.  This is not the kind            of  participation in an  offense that, in  our view, vitiates            the privilege.                 It is  no accident  that  the government's  case law  is            remote from the present facts and consists of cases where one            spouse enlisted a second spouse in a criminal  venture, e.g.,                                                                    ____            United  States  v. Parker,  834  F.2d 408,  412-13  (4th Cir.            ______________     ______            1987),  or a wife  knowingly assisted  a husband  in criminal                                         -9-                                         -9-            conduct,  e.g., United States v. Picciandra, 788 F.2d 39, 43-                      ____  _____________    __________            44 (1st Cir.  1986).  Here, even the  government shrinks from            flatly  asserting that the Rakeses were criminally liable for                                                    __________            extortion.                 We have  considered the government's  further suggestion            that Stephen Rakes engaged in misconduct by inducing his wife            not to report  the threat against him.   It is enough  to say            that  the fragments  of evidence  cited do not  even approach            misprision  of  felony  or accessory  after  the  fact.   The            government's theory would  make a criminal of anyone  who, as            the  victim of  a  crime  or faced  with  a criminal  threat,            resisted a spousal suggestion that the police be called.                 The  government's underlying  notion  may  be  that  the            privilege   is  lost  for  any  communication  that  plays  a            functional role in a crime--regardless of whether the parties            to  the  communication are  entirely  innocent  and otherwise            protected  by the privilege.  On  this view, the parents of a            kidnapped child could be compelled to testify after the event            about their intimate conversations with each other concerning            the kidnapping and possible payment of a demanded ransom.  It            is not an  attractive picture, and it is hard to believe that            the suggestion is seriously intended.                 In all events, it is not the law.  Under the crime-fraud            exception, we think  that it takes wrongful complicity by the            privilege  holder, not  innocent  or involuntary  action,  to                                         -10-                                         -10-            forfeit the privilege.  This is so even though, as with  many            applications of privilege, law enforcement may be hampered in            the interest of  other values.  The victims  of kidnapping or            extortion have problems enough; loss of otherwise  applicable            privileges is not part of the package.                       The  government's  remaining  argument  is that  Stephen            Rakes himself disclosed  the alleged threats to  others, most            importantly,   to  one  Brian   Burke.    According   to  the            government,  Rakes had promised to pay Burke for construction            and  related  work  on  the  liquor  store  and  owed  him  a            substantial sum.   When in early 1984 Burke  called about the            debt, the  government says that Rakes told  Burke in dramatic            terms that  he (Rakes) had  been forced out of  the business.            This, says  the government,  shows that  the information  was            never  confidential, and, in any event, the disclosure waived            the privilege.                     The  disclosure  to  Burke is  weak,  and  to  us wholly            unpersuasive, evidence that the  communications suppressed by            the  district court were  never intended to  be confidential.            For reasons already indicated, there is every reason to think            Stephen  Rakes'  conversations  with  Julie  Rakes  and  with            Sullivan  were  intended  to be  confidential.    The limited            disclosure  to Burke, however dramatic, was obviously made to            ward off  a debt  collection effort  and not because  Stephen                                         -11-                                         -11-            Rakes had any interest in broadcasting information that might            endanger his life.                 The  waiver  issue  is  more  complicated.   Ordinarily,            deliberate disclosure of a privileged communication, where no            privilege  protects   this  further   disclosure,  waives   a            communications privilege.  See United States v. MIT, 129 F.3d                                       ___ _____________    ___            681,  684-85 (1st Cir.  1997).   The restriction  is directed            against  selective disclosures  by  reserving protection  for            only those communications  that the privilege holder  himself            is prepared  to keep  confidential.  SEC  v. Lavin,  111 F.3d                                                 ___     _____            921, 929, 933  (D.C. Cir. 1997).   The restriction is one  of            public  policy,  and  applies  regardless  of  the  privilege            holder's subjective intent.  MIT, 129 F.3d at 684.                                         ___                 As already  noted, the privileged communication  and the            facts recounted within  it are two different things.  Upjohn,                                                                  ______            449 U.S.  at 395.  Thus, a client  does not normally lose the            privilege  as  to  communications  with  his attorney  merely            because he testifies  at trial to  the same events  discussed            with his lawyer.  United States v. El Paso Co., 682 F.2d 530,                              _____________    ___________            538-39, n.10 (5th  Cir. 1982).  Here, there  is no suggestion            that Stephen Rakes  ever told Burke or anyone  else about his            communications with Julie or with attorney Sullivan.            ______________                 Nevertheless, we  agree that (on  a theory of  waiver) a            disclosure of information might be so complete as to defeat a            claim of privilege.  We so held in United States v. Billmyer,                                               _____________    ________                                         -12-                                         -12-            57  F.3d 31 (1st  Cir. 1995), but  in peculiar circumstances:            the information  had been collected  by the attorney  for the            client and  then voluntarily disclosed in full  by the client            to   the  government;  the   issue  was  whether   this  same            information, already possessed by the government, should also            be made available  to the third  parties whom the  government            was prosecuting.                 The  present case  is  not  remotely  comparable.    The            communications by Stephen Rakes to his  wife and his attorney            apparently  contained much that  was not disclosed  to Burke,            whom the government  can always call as  a witness.  Nor,  in            contrast  to Billmyer,  is Rakes making  a disclosure  to the                         ________            government  while  trying  to withhold  the  information from            defendants  whom  the  government  is  trying  to  prosecute.            Billmyer is the exception, and we have no trouble letting the            ________            camel's nose into the tent without letting in the camel.                 At  oral argument the government accused Rakes of trying            to invoke  a "victim's privilege."   There is, of  course, no            such privilege.    A  defense  of  "duress"  exists  but  its            requirements are  stringent.  See  1 W. Lafave and  A. Scott,                                          ___            Substantive Criminal  Law,   5.3  (1986).  In any  event, the            _________________________            duress defense has not been  invoked in this appeal and forms            no part of  our decision.  We simply  agree with the district            court  that  the  suppressed  communications were  originally                                         -13-                                         -13-            privileged, and that there was no later loss of the privilege            as claimed by the government.                 The  government's arguments  are, as  is  usual in  this            district, presented  with skill,  and its  zeal to  pursue an            alleged extortionist is  understandable.  But skill  and zeal            are to  be harnessed by  common sense.   The notion  that the            Rakeses could properly  be treated as participating  in their            own  extortion is  Orwellian.   An  appeal for  which such  a            proposition had to  be the linchpin ought never  to have been            brought.                 Affirmed.                 _________                                         -14-                                         -14-
