(b) The time and resources required by counsel to respond
to the subpoena will not effectively prevent him from
acting as counsel to Payden. The lawyer will not be
discouraged from conducting a proper defense because of the
threat to forfeit his fees because the professional ethics
require zealous advocacy despite the risk that he will not
be paid. If either the lawyer or the client feels that the
lawyer "can no longer provide effective representation in
this case, the court will ensure that Payden is represented
by counsel who will provide effective representation of
Payden's interests." (Slip Op. at 15-18)

(c) Should it be necessary for the attorney to testify at
the trial (because his testimony concerning fee information
is relevant to the "substantial income" charge under
Section 848(a) and the forfeiture sought by the government
in the indictment) the lawyer will have to be
disqualified. Such disqualification, however, will not
violate the defendant's Sixth Amendment rights to
assistance of counsel. The court may order a limited
disqualification but permit "Simels to continue to assist
with Payden's defense, but not appear and consult in front
of the jury." (Slip Op. at 24)

(d) With respect to the defendant's claim of abuse of
grand jury process violating his Fifth Amendment due
process rights because the government is using the grand
jury subpoena to his lawyer as a discovery tool to
accumulate evidence for the pending CCE trial, the court
holds that the government is entitled to investigate the
matter fully, provided that there is no harassment or bad
faith shown by the subpoena of Simel.

It remains to be seen whether this case will withstand the scrutiny of appeal to the Second Circuit. A number of recent appellate cases articulate potential grounds that could result in a failure to sustain the district court decision. One of these grounds is the failure of the Court to adhere to the basic thrust of In Re Grand Jury Matters, 751 F.2d 13 (1st Cir. 1984). In this case five defense lawyers were served with Federal grand jury subpoenas requesting fee and fee source information shortly before they were about to start a state court trial involving the same clients. The First Circuit upheld the lower court's decision to quash the subpoenas:

In this case the court was presented with a
subpoena whose enforcement at the particular moment
seemed to it likely to entail consequences more
serious than even severe inconveniences occasioned
by irrelevant or overboard requests for records.
To call defense attorneys before the grand jury, in
connection with an investigation of the same
activities for which their clients were standing
trial in state court, while the attorneys were

preparing for this major felony trial, could be
taken as veiled threat, with such potential for
harm to the state defendants and the defense bar as
to require the government to show with some
particularity why the grand jury's investigation
required the execution of the subpoenas at this
particularly sensitive moment. Id. at 18.

Another possible basis for reversal can be found in the recent Second Circuit case of Roe v. United States, No. 84–6319 (2nd Cir. April 1, 1985). In a two-to-one decision, the Court held that grand jury subpoena to the target's attorney, who had represented the target for some eighteen years, should be quashed unless the government shows that the information it seeks can be obtained only from the defense lawyer. The court based this decision upon the protection of the attorney-client relationship:

First, the unbridled use of the subpoena would
potentially allow the Government, in this and
future cases, to decide unilaterally that an
attorney will not represent his client. Such a
power of disqualification can undermine and
debilitate our legal system by subjecting the
criminal defense bar to the subservience of a
governmental agent. The unrestricted exercise of
this power without adequate justification does not
strike us as necessary or indispensable in an
adversary system of criminal justice, particularly
when we consider the significance of the
attorney-client relationship and the need for an
independent bar. Second, as noted earlier, the
right to have counsel of one's choosing in the
defense of a criminal charge is of constitutional
dimensions. Thus, any potential infringement of
this right must only be as a last resort. ...
Requiring adequate justification will prevent the
arbitrary dismissal of an attorney, and still
protect the grand jury's access to information if
the Government can demonstrate that the attorney's
testimony is not only relevant but that there is a
need for it that cannot reasonably be met in some
other fashion. (Slip Op. Pp. 16-17)

Sheehan and Groh

Case No. CRF No. 84-198 REC (E.D. Cal. argued April 8, 1985)

In this case of first impression, the government in a "continuing criminal enterprise" forfeiture case, included in the indictment, a request for the forfeiture of attorneys' fees:

Any and all fees in the form of currency, real and/or personal property or other thing of value paid or transferred after November 14, 1984 (the

date of the arrest) by or on behalf of the
defendant and to the attorney(s) representing him
or a co-defendant, or as a result of this matter,
which currency, real and/or personal property or
other thing of value is owned or possessed by
defendant prior to the transfer to said attorney(s).

Before indictment, defense attorney Neal Sonnett received a "Notice Letter" indicating that the government sought forfeiture of any attorney's fees received by him and that any effort to dispose of his clients' fees would expose Sonnett to criminal prosecution for obstruction of justice. Counsel for co-defendant Groh, Albert Kreiger, received a similar letter. After indictment, both Sonnett and Kreiger received Rule 17(c) subpoenas seeking fee records and fee source information of their clients. The subpoenas have now been withdrawn.

The case has been briefed and argued, but no decision has been announced.

CONCLUSION AND SUMMARY

The foregoing report, and the cases cited in it, provide ample illustration of the dramatic detrimental impact that forfeiture of attorneys' fees is having on our system of criminal justice. It is worthwhile summarizing these effects as a means of concentrating attention on the magnitude and breath of their impact.

Accordingly, the following list recites the more serious ramifications of the attorney fee forfeiture practice:

1. It denies an accused the right, under the Sixth Amendment, to retain counsel of his or her choice;

2. It impedes the ability of such retained counsel to render effective assistance;

3. It impairs the relationship of confidence and

confidentiality between an accused and his or her counsel;

It allows the government to manipulate the roster of counsel, or to disqualify counsel by seeking to compel testimony by the lawyer against the client;

5.

It discourages or disallows competent attorneys from agreeing to represent clients in criminal cases which involve allegations of forfeiture; and

6. It diverts the efforts and energies of attorneys from the preparation of the defense of an accused by requiring them to litigate issues related to their attorney-client relationship.

If the forfeiture practice continues unabated and becomes a widely accepted prosecutorial practice, the resulting effects recited above will erode the elements that assure fundamental

fairness and balance in our criminal justice system. It is the ABA Criminal Justice Section's concern that these elements continue to be an integral part of our system of justice that leads to this

resolution's adoption.

July, 1985

Respectfully submitted,

Paul T. Smith, Chairperson

Criminal Justice Section

General Information Form

To Be Appended to Reports with Recommendations

No.

(Leave Blank)

Submitting Entity Criminal Justice Section

Submitted By Paul T. Smith, Section Chairperson

1. Summary of Recommendation(s).

It is recommended that the American Bar Association disapprove of using the forfeiture provisions and subpoena provisions of the "Comprehensive Crime Control Act of 1984" against attorneys actively representing defendants, unless there is reasonable grounds to believe the attorney is engaged in criminal activity or has accepted a fee to protect illegal activity of a client.

2. Approval by Submitting Entity.

The Criminal Justice Section Council approved the recommendation at its May 11-12, 1985 meeting in San Francisco, California.

3. Background. (Previous submission to the House or relevant Association position.)

This recommendation has not been submitted to the House of Delegates previously. Neither is there any existing ABA policy on

this specific issue.

4. Need for Action at This Meeting.

Since the enactment of the "Comprehensive Crime Control Act of 1984" in October, 1984, United States Attorneys in certain federal districts have been using its provisions to seek forfeiture of fees paid to lawyers by clients who are accused of racketeering and drug offenses. Attorneys have also been called before federal grand juries to testify concerning activities of clients who they represent in these matters. Both these practices have hampered defendants who are accused of federal racketeering and offenses in their efforts to retain competent counsel of their choice. It is important that the ABA take an immediate position opposing this tactic before its use proliferates, posing even greater problems for our system of equal justice.