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CALLAHAN v. A.E.V. INC.

August 12, 1996

MICHAEL W. CALLAHAN, et al., Plaintiffs,
v.
A.E.V. INC., et al., Defendants - and - A.L. ABROMOVITZ, et al., Plaintiffs, v. A.E.V. INC., et al., Defendants



The opinion of the court was delivered by: CINDRICH

MEMORANDUM ORDER

 CINDRICH, District Judge

 August 12, 1996

 Defendant Trone and others were targets of a three-year Pennsylvania state grand jury investigation which concluded in 1992. The investigation resulted in a twenty-three count indictment against Trone which included charges of tampering with public records, criminal solicitation, deceptive business practices and involvement in corrupt organizations.

 The instant action was initiated in 1992 by local beer distributors alleging harm from the acts of Trone and his associates. To prove their case, plaintiffs have sought numerous documents from Trone including documents submitted by Trone to the Pennsylvania grand jury, documents received from the grand jury, and transcripts of grand jury testimony in Trone's possession.

 Trone has objected to the document request claiming that such documents and transcripts are not relevant to the present action and are covered by a grand jury privilege. According to the defendants, the materials sought are Commonwealth grand jury materials and, as such, the proper party to determine disclosure is the Pennsylvania court overseeing the grand jury. Defendants also contend that plaintiffs bear the burden of showing that the alleged grand jury privilege should be lifted.

 Plaintiffs argue that the motion to compel responses should be granted because the documents sought are not privileged. Plaintiffs dispute defendants' claim that the documents sought are not relevant to the instant action and argue that the documents no longer have a meaningful need for secrecy. Under the liberal rules of discovery, plaintiffs contend, the documents and transcripts sought must be turned over absent any relevant privilege.

 Federal Rule of Civil Procedure 26(b) requires the disclosure of requested information not privileged and reasonably calculated to lead to the discovery of admissible evidence. A motion to compel under Rule 37(a)(1) for failure to provide relevant information sought through discovery requires us to determine if the materials requested are relevant to the action and whether all or part of the materials are covered by a privilege that prevents their disclosure.

 This case presents a rare situation for two reasons. First, the documents are being sought are those previously submitted to state grand jury or supplied by the prosecution to the defendant. Second, the alleged grand jury documents are sought not from the grand jury, but from a third party -- a target of a grand jury. We have combed the reported cases and found a dearth of federal cases where such document and transcript requests are made directly to the defendant and fewer still involving state grand juries.

 Plaintiffs have sought two types of materials involving the prior state grand jury investigation. First, plaintiffs seek documents submitted to or received from the Pennsylvania grand jury. In this category we will refer to "documents" as all materials other than transcripts of grand jury testimony. Second, plaintiffs seek any transcripts from that grand jury investigation. We will address these requests separately.

 What has been erroneously assumed by both sides is that all of the documents involved are grand jury materials. Not all documents received by a grand jury are converted into "grand jury materials." In re Grand Jury Investigation, 630 F.2d 996, 1000 (3d Cir. 1980). The party asserting that the materials involved are grand jury materials bears the burden of showing such. Here, defendants assert that all materials requested are grand jury materials and entitled to a presumption of privilege. Yet no showing is made that any of the documents requested will disclose the inner working of the grand jury, the purpose of the privilege being to avoid such disclosure. Id. If the documents requested are not covered by a grand jury privilege, the rules of discovery mandate that such documents be produced. Defendants have not satisfactorily demonstrated that any such privilege attaches to the documents. Accordingly, defendants are ordered to produce the requested documents submitted to or received from the Pennsylvania state grand jury.

 Plaintiffs have also requested any grand jury transcripts that defendants may have in their possession. Being created by the grand jury, such transcripts obviously may carry some privilege; the initial question consists of identifying the standard by which the privilege measured. The Third Circuit has held, and other circuits agree, that in federal question cases the federal common law of privileges applies. *fn1" Wm. T. Thompson Co. v. General Nutrition Corp., 671 F.2d 100, 103 (3d Cir., 1982); von Bulow v. von Bulow, 811 F.2d 136, 141 (2d Cir. 1987); Memorial Hospital for McHenry County v. Shadur, 664 F.2d 1058 (7th Cir. 1981). While the Third Circuit has not ruled on the status of the common law of a state grand jury privilege, other circuits and district courts have uniformly held that the standard is the same as that for disclosure of federal grand jury materials. See United States v. Tynan, 757 F.2d 1085, 1089-90 (10th Cir. 1985); United States v. Silva, 745 F.2d 840, 845 (4th Cir. 1984); Socialist Workers Party v. Grubisic, 619 F.2d 641, 643 (7th Cir. 1980).

 Defendants claim that the Pennsylvania court overseeing the grand jury investigation from which transcripts are being sought should determine whether to release the transcripts. We disagree. Defendant cites many cases where courts have held that the court overseeing an investigation is in the best position to determine whether to release transcripts. All of these cases involve a federal court being requested to obtain transcripts from a state court. Plaintiffs here have requested transcripts from the defendants. A reading of Pennsylvania law on the privilege attached to grand jury transcripts reveals that the overseeing court serves as the protector of transcripts unless the transcripts are released pursuant other provisions. Pa. Crim. R. 261. One such provision is that transcripts may be provided to a criminal defendant for use at trial. Pa. Crim. R. 263. If defendant has transcripts of the grand jury proceedings, such transcripts would have been obtained pursuant to this provision. As such, the Pennsylvania court overseeing the grand jury investigation is no longer the guardian of transcripts in Trone's ...


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