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RESOLUTION TRUST CORP. v. LOPEZ

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA


May 5, 1992

RESOLUTION TRUST CORPORATION, Petitioner,
v.
PEDRO RAMON LOPEZ and TERESA SALDISE, Respondents.

The opinion of the court was delivered by: LOUIS F. OBERDORFER

MEMORANDUM

 The Resolution Trust Corporation ("RTC") moves for enforcement of two subpoenas duces tecum targeted at two former directors or officers of a failed Florida savings and loan. The subpoenas seek tax returns, bank statements, insurance policies, and several other categories of personal financial records reflecting the sources and amount of respondents' assets. The RTC alleges that it served the subpoenas on November 30, 1991, and has not received any response. Respondents argue that they were not served with the subpoenas, and that, in any event, the very act of producing the documents and the documents' contents are protected by the Fift Amendment privilege against self-incrimination. The Court heard argument on the RTC's petition on April 30, 1992. For the reasons stated below, the Court will grant RTC's petition to enforce the subpoenas, but will stay enforcement for a period of twenty days and transfer the action to the Southern District of Florida, without prejudice to respondents' seeking further consideration of this order in that court.

 The RTC is investigating potential civil claims arising from the failure of General Federal Savings Bank in Miami, Florida. As part of that investigation, the RTC issued two identical subpoenas duces tecum directed toward respondents Lopez and Saldise, former directors or officers of General Federal who are husband and wife. According to the RTC's affidavits, the subpoenas were served on an unidentified adult male at respondents' residence on November 30, 1991. Mr. Lopez also has filed an affidavit, in which he avers that the two subpoenas were not served on him. However, respondents have not attempted to controvert the RTC's claim that the subpoenas were in fact delivered to someone at the respondents' residence, or that both respondents have actual knowledge of them. Thus, the service issue is disposed of by applicable FDIC regulations, *fn1" which provide that "service of a subpoena may be made by personal service, by delivery to an agent, by delivery to a person of suitable age and discretion at the subpoenaed person's residence . . . or in such other manner as is reasonably calculated to give actual notice." 56 Fed. Reg. 37,979 (Aug. 9, 1991) (to be codified at 12 C.F.R. § 308.11(d)). At a minimum, the affidavits show that the subpoenas were left with an adult at respondents' residence, which showing is sufficient under the regulation. Accordingly, respondents' service claim does not provide any basis for denying enforcement.

 Respondents argue that they have "reasonable cause" to believe that documents produced in response to the subpoenas might be used against them in a criminal prosecution. Hoffman v. United States, 341 U.S. 479, 486, 95 L. Ed. 1118 , 71 S. Ct. 814 (1951); Butcher v. Bailey, 753 F.2d 465, 470 (6th Cir.), cert. dismissed, 473 U.S. 925, 87 L. Ed. 2d 696, 106 S. Ct. 17 (1985). This claim is amply supported by the fact that the Office of Thrift Supervision already has brought allegations of misrepresentation and misapplication of funds against the respondents in the Southern District of Florida, and by regulations which require the RTC to refer possible evidence of any criminal violations to the United States Attorney. 12 C.F.R. § 563.180(d). As a result, the respondents essentially assert that the privilege must apply to all thirty-four categories of documents sought by the subpoenas.

 At the outset, however, it seems clear that category 1, the respondents' federal and state tax returns and associated schedules and exhibits, are "required records" that are outside the scope of the privilege. Shapiro v. United States, 335 U.S. 1, 92 L. Ed. 1787 , 68 S. Ct. 1375 (1948); OTS v. Zannis, Misc. No. 90-0136, 1990 U.S. Dist. LEXIS 10591 (D.D.C. Aug. 14, 1990). Accordingly, the Court will immediately enforce that portion of the subpoenas, and will order respondents to produce all such documents to the RTC forthwith.

 As for the remaining categories of documents, respondents are protected by the Fifth Amendment privilege if the act of producing those documents is both "testimonial" and "incriminating." Fisher v. United States, 425 U.S. 391, 410, 48 L. Ed. 2d 39 , 96 S. Ct. 1569 , 37 A.F.T.R.2d (P-H) 1244 (1976). For instance, where admitting the existence, possession, or authenticity of documents would itself be an incriminating fact, the privilege has been held to be applicable. See United States v. Doe, 465 U.S. 605, 79 L. Ed. 2d 552 , 104 S. Ct. 1237 , 57 A.F.T.R.2d (P-H) 1270 (1984). In the present case, it is simply not clear from the record before the Court that the act of producing documents would incriminate the respondents. It does not appear that here, as in Zannis, and at least one district court has required the respondent "to specify, as to each document, the basis of the asserted Fifth Amendment privilege." FSLIC v. Hardee, 686 F. Supp. 885, 886 (N.D. Fla. 1988). Thus, in light of the respondents' failure to make a more detailed showing of how the privilege applies to the requested documents, the Court is inclined to grant the RTC's petition to enforce the two subpoenas in full.

 At the same time, the Court is mindful that determination of the privilege question "depends on the facts and circumstances of particular cases." Fisher, 425 U.S. at 410. It appears that the best way to ascertain the facts and circumstances of this case and ultimately to ensure that the respondents' interest are protected would be an in camera review of the requested documents, such as the one conducted in Hardee. 686 F. Supp. at 886. Given that the documents at issue are located in Florida, the most efficient venue for such review is the Southern District of Florida, the district in which respondents reside and where this action might have been brought. Accordingly, while the Court will order respondents to produce the remaining thirty-three categories of documents, it will transfer this action under 28 U.S.C. § 1404(a) for the convenience of the parties and in the interest of justice, and also will stay enforcement of that order for twenty days. Once the case has been transferred to the Southern District of Florida, the respondents may seek reconsideration of the accompanying Order in that court. Nothing in the ruling here should prejudice any contention by the respondents for review of this ruling in general or with respect to particular documents which respondents consider to be privileged by operation of the Fifth Amendment. *fn2"

 DATED: May 5, 1992

 LOUIS F. OBERDORFER

 United States District Judge

 ORDER - May 5, 1992, Filed

 Upon consideration of the RTC's petition to enforce subpoenas duces tecum served on the respondents, and for the reasons stated in the Court's Memorandum of this same date, it is hereby

 ORDERED, that the RTC's petition is GRANTED, and the subpoenas shall be enforced in full. It is further

 ORDERED, that respondents shall produce forthwith all tax documents described in category 1 of the subpoenas. It is further

 ORDERED, that enforcement of the remainder of the subpoenas shall be stayed for a period of twenty days. It is further

 ORDERED, that this action shall be transferred forthwith to the Southern District of Florida, without prejudice to respondents' seeking reconsideration there of this Order, either in general or with respect to particular documents.

 IT IS SO ORDERED.

 DATED: May 5, 1992

 LOUIS F. OBERDORFER

 United States District Judge


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