In re Grand Jury Proceedings, G.S., F.S.

Business owners G.S. and F.S. planned to file for bankruptcy and consulted J.P. (defendant), an experienced bankruptcy attorney. G.S. and F.S. had assets that were not exempt from bankruptcy liquidation and sought J.P.’s advice on exemption planning. J.P. warned G.S. and F.S. about the potential for bankruptcy fraud, including the risks of conducting insider transactions with close relatives and repurchasing their assets after the bankruptcy proceeding. G.S. and F.S. ignored these warnings and sold certain assets to relatives. Some stock was sold to G.S.’s parents, with the rest given to another relative as collateral for a loan. G.S.’s father provided the relative with the money for this loan. J.P. facilitated these transactions. A year later, G.S. and F.S. filed for bankruptcy. J.P. was not involved. After the proceeding, G.S. and F.S. bought their property back from family members for no loss. The federal government (plaintiff) began a grand jury investigation of G.S. and F.S. for bankruptcy fraud, and the government served J.P. with a subpoena for evidence, including opinion work product, related to J.P.’s representation of G.S. and F.S. prior to the bankruptcy proceeding. J.P. refused to comply, claiming protection under the work-product doctrine. The district court reviewed the relevant evidence in camera and found probable cause to believe J.P. was complicit in the unlawful conduct of G.S. and F.S. The district court held that the privileges J.P. asserted did not protect the subpoenaed work product, because the work product fell within the crime-fraud exception. J.P. was ordered to appear before the grand jury. J.P. appealed.