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ROBERT HAWTHORNE v. COUNTY INVESTIGATING GRAND JURY (03/20/80)

SUPREME COURT OF PENNSYLVANIA


decided: March 20, 1980.

ROBERT HAWTHORNE, INC., APPELLANT,
v.
COUNTY INVESTIGATING GRAND JURY, APPELLEE. APPEAL OF THOMAS HAWTHORNE

No. 459 January Term 1979, Appeal from the Adjudication and Order of the Court of Common Pleas, Criminal Division, Philadelphia County, at Misc. No. 79-00-8008

COUNSEL

Wilbur Greenberg, Philadelphia, for appellant.

Steven H. Goldblatt, Deputy Dist. Atty., Philadelphia, for appellee.

Eagen, C. J., and O'Brien, Roberts, Nix, Larsen and Flaherty, JJ. Flaherty, J., filed a concurring opinion in which Nix, J., joins.

Author: Eagen

[ 488 Pa. Page 376]

OPINION

On November 28, 1979, the judge supervising the Philadelphia Investigating Grand Jury, empanelled on June 1, 1979, pursuant to the Investigating Grand Jury Act*fn1 [hereinafter: Act], adjudged Thomas Hawthorne, Vice President of Robert Hawthorne, Inc. (Hawthorne Corporation) in civil contempt for his refusal to comply with grand jury subpoena duces tecum No. 671. The same day, this Court entered a stay pending disposition of Thomas Hawthorne's appeal.

The background is as follows:

On June 22, 1979, the Commonwealth filed a notice of submission with the supervising judge, as required by section 9(a) of the Act, advising the court that the resources of the grand jury were necessary to investigate the circumstances surrounding the dumping of solid fill at a city-owned cite beneath the Penrose Bridge. On September 26, 1979, the grand jury issued a subpoena duces tecum to the custodian of records of the Hawthorne Corporation, which directed production of the corporation's records before the grand jury concerning the Penrose Bridge landfill for the period from September 1, 1978 to September 1, 1979. Hawthorne Corporation moved to quash the subpoena on October 15, 1979. After a hearing, the supervising judge ordered the

[ 488 Pa. Page 377]

Commonwealth to submit a more detailed " Schofield affidavit"*fn2 and fixed a date to enable Hawthorne Corporation to present testimony in support of its motion to quash.

On October 22, 1979, Hawthorne Corporation presented its testimony, and the supervising judge held an additional hearing with members of the district attorney's office, incamera, to inquire into the propriety of the investigation. The motion to quash subpoena No. 579 was denied on October 24, 1979, and, on October 29, 1979, compliance with the subpoena was ordered. On October 29, counsel for Hawthorne Corporation filed an amended motion to quash which was denied by the court after argument. The custodian of records, Mary Grabowski, then appeared before the court without the subpoenaed records and stated her employer would not permit her to comply with the subpoena. The court then directed the custodian to appear before the grand jury the following morning with the cash receipts journal, cash disbursements records, and check stubs of the corporation*fn3 for the period from September 1, 1978 to September 1, 1979. Hawthorne Corporation delivered the subpoenaed records to the grand jury on October 30, 1979.

Apparently because of unusual bookkeeping methods utilized by Hawthorne Corporation, the records made available did not contain all the information sought by the Commonwealth, and another subpoena duces tecum was issued to the custodian of records of Hawthorne Corporation. On November 19, 1979, custodian Grabowski appeared before the court and testified that an agent of the president of Hawthorne Corporation had informed her she was not to deliver any records to the grand jury. Based on this information, the court determined a subpoena should be issued to either Edgar Hawthorne or Thomas Hawthorne, president and vice president of Hawthorne Corporation respectively. Subpoena duces tecum No. 671, which ordered production of various

[ 488 Pa. Page 378]

    corporate records on November 26, 1979, was then served on Thomas Hawthorne. He appeared before the court on November 26 without the records. Counsel for Hawthorne Corporation moved to quash the subpoena on the ground it was oppressive in view of his client's compliance with the original subpoena.*fn4 The motion to quash was denied, and Thomas Hawthorne was ordered to appear before the grand jury the following day with the subpoenaed records.*fn5 He appeared without the records on November 27, 1979, and, after a hearing on November 28, 1979, was adjudged in civil contempt and ordered imprisoned until he purged himself. This appeal followed.

Thomas Hawthorne, appellant, argues the adjudication of contempt must be set aside because the grand jury's investigation of Hawthorne Corporation was illegal since it was instituted without trustworthy information that crimes had been or were being committed.*fn6 He also challenges the constitutionality of the Act and the validity of subpoena duces tecum No. 671. We will discuss Hawthorne Corporation's contentions seriatim.

Many years prior to the passage of the Act, this Court imposed in relevant decisions certain restrictions or conditions

[ 488 Pa. Page 379]

    on grand jury investigations in Pennsylvania.*fn7 See McNair's Petition, 324 Pa. 48, 187 A. 498 (1936). See also Dauphin County Grand Jury Investigation Proceedings (No. 1), 332 Pa. 289, 2 A.2d 783 (1938); Special Grand Jury Case, 397 Pa. 254, 154 A.2d 592 (1959); and, Commonwealth ex rel. Camelot Detective Agency v. Specter, supra. We ruled, inter alia, that, before a grand jury investigation may be ordered, "there must be presented [to the court] some credible evidence from a trustworthy source that a violation of the criminal law has taken place . . . ." Commonwealth ex rel. Camelot Detective Agency v. Specter, supra 451 Pa. at 373, 303 A.2d at 205 [emphasis in original].

However, the Act superseded the foregoing decisions of this Court and the provisions of the Act now govern grand jury investigations in Pennsylvania. The Act does not require that the investigation be supported by information, from a trustworthy source, that a violation of the criminal law has been committed. In relevant part the Act, section 9(a), requires only the following:

"(a) Before submitting an investigation to the investigating grand jury the attorney for the Commonwealth shall submit a notice to the supervising judge. This notice shall allege that the matter in question should be brought to the attention of the investigating grand jury because the investigative resources of the grand jury are necessary for proper investigation. The notice shall allege that one or more of the investigative resources of the grand jury are required in order to adequately investigate the matter."

A study of the instant record demonstrates the district attorney complied with section 9(a). He submitted the required notice alleging that "the investigative resources of the grand jury are necessary for proper investigation." The notice also recited specific investigative resources which the district attorney deemed necessary to adequately investigate the circumstances of the dumping of solid fill on the city-owned realty, namely, "the power to compel attendance of

[ 488 Pa. Page 380]

    investigating witnesses and the power to require the production of documents, records and other evidence . . . ." For the foregoing reasons, we reject the position that the grand jury investigation of Hawthorne Corporation was unlawful for the reasons stated.*fn8

Appellant next contends that the Act violates the Fourth Amendment to the United States Constitution and Article 1, Section 8, of the Pennsylvania Constitution because it permits a seizure without a showing of probable cause. Although a subpoena duces tecum directed to a corporation may be an unreasonable seizure within the meaning of the Fourth Amendment if it is too sweeping in its terms, Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652 (1906),*fn9 our research has disclosed no federal or Pennsylvania requirement of probable cause before issuance of a subpoena duces tecum. See United States v. Grand Jury Investigation, 417 F.Supp. 389 (E.D.Pa.1976); Levinson v. Attorney General of the United States, 321 F.Supp. 984 (E.D.Pa.1970).

Appellant next contends that he has been denied due process under the Fourteenth Amendment to the United States Constitution. He complains of being "enmeshed in the criminal process solely because of the prosecutor's surmise" and of being "subjected . . . to a grand jury investigation causing it to spedn [sic] thousands of dollars in costs and attorney's fees and to wast [sic] valuable time." Appellant cites no authority to support his contention nor

[ 488 Pa. Page 381]

    does he adequately explain this theory of denial of due process. Apparently, he complains of the expense of being subpoenaed by the grand jury to give evidence based only on the "surmise" of the district attorney. We find no merit in this claim.

The United States Supreme Court has ruled that grand jury investigations may be triggered "by tips, rumors, evidence proffered by the prosecutor, or the personal knowledge of the grand jurors." See Branzburg v. Hayes, 408 U.S. 665, 701, 92 S.Ct. 2646, 2667, 33 L.Ed.2d 626 (1972). See also In re Special February 1975 Grand Jury, 565 F.2d 407, 411 (7th Cir. 1977) (grand jury may properly investigate on the basis of tips, rumors, hearsay, speculation or any other source of information). Moreover, the "mere possibility" that violations of federal laws have occurred is sufficient reason to conduct a federal grand jury investigation. See United States v. Williams, 552 F.2d 226, 230 (8th Cir. 1977); United States v. Sisack, 527 F.2d 917, 920 (9th Cir. 1976). Accordingly, since we know of no due process impediment to conducting a grand jury investigation founded on "rumors" or "mere possibilities" at the federal level and since the information presented here to the supervising judge met the federal standard, appellant's complaint that the instant investigation is improperly based on "surmise" is also without merit.*fn10 The Fourteenth Amendment due process clause does not require the states to go beyond federal standards.

Appellant's complaint about the "expense" of appearing before the investigating grand jury is apparently a claim that compliance with the subpoena is economically burdensome. This claim is similarly without merit. The United States Supreme Court has emphasized that "[c]itizens generally

[ 488 Pa. Page 382]

    are not constitutionally immune from grand jury subpoenas . . . ." Branzburg v. Hayes, supra, 408 U.S. at 682, 92 S.Ct. at 2657. Furthermore, the "duty" to appear before the grand jury outweighs injury to a witness' "social and economic status." United States v. Calandra, 414 U.S. 338, 345, 94 S.Ct. 613, 618, 38 L.Ed.2d 561 (1974). Accordingly, economic cost or expense fails to override the importance of appearing before a grand jury.

Finally, appellant mounts several attacks against the subpoena duces tecum. In order to properly review these claims, the procedure followed by the supervising judge should be examined.

In addition to a variety of specific new responsibilities reposed in a supervising judge by the Act, the supervising judge continues to be responsible for control of the subpoena process. See Carabello Appeal, 238 Pa. Super. 479, 357 A.2d 628 (1976). Instantly, in response to the motion to quash the subpoena, the supervising judge followed the procedure prescribed in Judge Spaeth's opinion in Salvitti Appeal, 238 Pa. Super. 465, 357 A.2d 622 (1976) [allocatur refused].*fn11 That procedure, used to aid the court in satisfying itself of the propriety of a subpoena before ordering its enforcement, is drawn from the decision of the United States Third Circuit Court of Appeals in In re Grand Jury Proceedings, 486 F.2d 85 (3rd Cir. 1973) [hereinafter: Schofield ], which required the following:

"[W]e think it reasonable that the Government be required to make some preliminary showing by affidavit that each item is at least relevant to an investigation being conducted by the grand jury and properly within its jurisdiction, and is not sought primarily for another purpose. . . . [U]nless extraordinary circumstances appear, the nature of which we cannot anticipate, the Government's supporting affidavit should be disclosed to

[ 488 Pa. Page 383]

    the witness in the enforcement proceeding. . . . If after such disclosure the witness makes application . . . for additional discovery in the enforcement proceeding the court must in deciding that request weigh the quite limited scope of an inquiry into abuse of the subpoena process, and the potential for delay, against any need for additional information which might cast doubt upon the accuracy of the Government's representations." Id. at 93.

The Third Circuit adopted the Schofield procedure, not as a matter of constitutional law, but pursuant to its supervisory power over the manner in which the district court employs the subpoena process. We are persuaded the Schofield procedure will enable supervising judges to monitor investigating grand jury subpoenas in an orderly, fair, and expeditious manner. Therefore, pursuant to our supervisory powers, Pa.Const., art. V, ยง 10, we adopt this procedure for use in enforcement proceedings resulting from subpoenas issued by grand juries empanelled under the Act.

Subpoena No. 671 is challenged instantly on the grounds that: (1) there was no allegation of a crime on the face of the subpoena or in the Schofield affidavit, and the investigation was, therefore, a "fishing expedition"; (2) the records involved are being sought for purposes of a civil, rather than a criminal proceeding; and, (3) the subpoena is oppressive.*fn12 In the exercise of his discretion, the supervising judge permitted the presentation of evidence in support of these challenges. In order to further satisfy himself of the propriety of the investigation, the supervising judge conducted an in-camera hearing with representatives of the district attorney's office to further probe the basis for conducting the inquiry and requested submission of an amended Schofield affidavit by the Commonwealth. The record of this proceeding was made available to counsel for appellant.

The district attorney supplied the court with sufficient information to determine whether the investigation into possible bribes of city officials was properly within the

[ 488 Pa. Page 384]

    jurisdiction of the grand jury. The court found that, given the information in the possession of the district attorney, there was a "credible, sound" basis on which to believe crimes may have occurred and that the investigative resources of the grand jury were necessary to compel production of otherwise unavailable witnesses and documents. The record supports this determination. The court further found that, under the circumstances forming the basis of the investigation, the documents sought from Hawthorne Corporation were clearly relevant and the investigation could not be characterized as a "fishing expedition."*fn13 This determination is also supported by the record, and we will not disturb it.

Appellant also alleges the subpoenaed records are being sought for purposes of a civil, rather than a criminal, proceeding because the subpoena alleges no crime and because Hawthorne Corporation's assessment of its own situation is that no criminality exists. This claim was not asserted in the four motions to quash the subpoenas in the lower court; accordingly, we will not consider it further in this appeal. Cf. Commonwealth v. Romberger, 474 Pa. 190, 378 A.2d 283 (1977) (where an issue is cognizable in a given proceeding and is not raised, it is waived and will not be considered on a review of that proceeding).

Finally, appellant claims the subpoena should have been quashed because it was oppressive. In support of that claim, the supervising judge was informed that compliance would be burdensome and inconvenient to the conduct of Hawthorne Corporation's business. Mere inconvenience is not a basis for finding a subpoena unreasonable. See In re Grand Jury Investigation, 459 F.Supp. 1335 (E.D.Pa.1978). The supervising judge assured Hawthorne Corporation the

[ 488 Pa. Page 385]

    least burdensome arrangements possible would be made for use of the subpoenaed records.

We are satisfied the supervising judge took every step in response to Hawthorne Corporation's motion to quash required by the Act or by case law to guarantee proper functioning of the grand jury and the protection of appellant and Hawthorne Corporation.

The adjudication of contempt and order are affirmed. The stay previously granted is vacated.

FLAHERTY, Justice, concurring.

I cannot agree with the majority that if there is no due process impediment to conducting a grand jury investigation founded on "rumors" or "mere possibilities" in the federal jurisdiction, such constitute sufficient grounds on which to base an investigation by a grand jury in the Commonwealth of Pennsylvania. It is true that the Fourteenth Amendment due process clause does not require the states to go beyond federal standards; however, we are free to adopt more stringent standards in order to safeguard the rights of our citizens.

Historically, as a prerequisite to a grand jury investigation in Pennsylvania, it was required that a judicial determination take place that some credible evidence from a trust-worthy source of a violation of the criminal law was present. Commonwealth ex rel. Camelot Detective Agency, Inc. v. Specter, 451 Pa. 370, 303 A.2d 203 (1973). As William Penn, the founder of this Commonwealth, was the target of similar practices perpetrated by King Charles and his "council" in secret meetings, the people of Pennsylvania should be particularly mindful of the abuses that can result when inquisitions are held in secret to discern whether or not some crime may have been committed.

The grand jury must not be set upon fruitless searches, founded upon mere rumor, suspicion or conjecture.

[ 488 Pa. Page 386]

McNair's Petition, 324 Pa. 48, 187 A. 498 (1936). To hold otherwise is to pave the way for witchhunts and "fishing expeditions". The liberty of our citizens should not be jeopardized by indiscreet and reckless charges.

In view of how basic this concept is to the law of our Commonwealth, the majority need not have added this unnecessary language.

Therefore, I concur only in the result.


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