Naushad et al v. Ware
MEMORANDUM AND ORDER IT IS HEREBY ORDERED that Petitioners motion for an order requiring the return of certain seized documents on the ground that they are protected under the attorney-client privilege and work product doctrines is DENIED. (Doc. No. 1.) IT IS FURTHER ORDERED that Petitioners motion to recover copying costs (Doc. No. 18) is GRANTED in part and DENIED in part as follows: a) the Government shall reimburse Petitioners for $750.00 of the copying costs they incurred, and b) Petitioners shall bear the remainder of the requested copying costs. re: 1 MOTION to Quash filed by Petitioner Abdul Naushad, M.D. P.C., Petitioner Billy Jo Ann Wilmert Signed by District Judge Audrey G. Fleissig on 3/31/14. (JWJ)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
IN THE MATTER OF THE SEARCH OF
ADVANCED PAIN CENTERS POPLAR
BLUFF, ABDUL NAUSHAD, M.D.,
P.C., a/k/a ADVANCED PAIN
CENTERS, a Missouri Professional
Corporation, et al.,
TIMOTHY WARE AND OTHER
UNKNOWN FEDERAL AGENTS,
Case No. 4:13CV01408AGF
Case No. 1:13CV00107 AGF
MEMORANDUM AND ORDER
Petitioners Adbul Naushad, M.D. P.C., also known as Advanced Pain Centers
(“APC”), and Billy Jo Ann Wilmert brought this action under Rule 411 of the Federal
Rules of Criminal Procedure against Respondents Timothy Ware and other unknown
federal agents (“the Government”) seeking to exclude as evidence, or obtain the return of,
certain seized documents and objects. This matter was originally filed as six separate
civil actions. Petitioners styled their initial filing in each case as a “Motion Pursuant to
Rule 41 of the Federal Rules of Criminal Procedure was reorganized in 2002, at
which time the provision related to the return of seized property, Rule 41(e), was redesignated as Rule 41(g). No substantive change was made to the Rule. Following this
re-designation, courts have applied case law relating to former Rule 41(e) to the current
Rule 41(g). See United States v. Garza, 486 F. App’x 782, 784 n.3 (11th Cir. 2012);
Bennett v. United States, No. 12–61499–CIV, 2013 WL 3821625, at * 8 n.5 (S.D. Fla.
2013); see also 3A Charles Alan Wright, Nancy J. King & Susan R. Klein, Federal
Practice & Procedure: Criminal § 690 (4th ed. 2004) (explaining that “[c]ourts recognize
that case law interpreting former Rule 41(e) generally applies to current Rule 41(g)”).
Federal Rule of Civil Procedure 41 to Quash Search Warrants, Subpoenas, And/Or To
Return Property Seized During the Course of the Execution of an Illegal Search.” On
Petitioners’ motion, the cases were transferred to the undersigned and consolidated, with
the three Southeastern Division cases consolidated into Case No. 1:13CV00107 AGF,
and the three Eastern Division cases consolidated into Case No. 4:13CV01408 AGF.
The Court promptly held a conference with counsel, at which a procedure for
addressing matters Petitioners identified as needing immediate attention was discussed.
At the outset, the parties agreed to address, immediately, certain time-sensitive issues
related to the seized documents, with the understanding that an evidentiary hearing on
Petitioners’ more comprehensive request for relief under Rule 41 would be conducted at
a later date.
Consistent with the procedures discussed at the conference, Petitioners filed a
Motion for a Temporary Restraining Order (“TRO”) on July 22, 2013, seeking, in part,
the immediate return of all items seized, including patient files, personal property, and
documents claimed to be protected by the attorney-client and work product privileges,
and a prompt hearing was set on dates agreed to by the parties. Although Petitioners filed
the motion for TRO only in the consolidated Southeastern Division cases (Case No.
1:13CV00107 AGF), the issues raised and documents covered pertained to all six cases
and search warrants. During the pendency of the motion for TRO, the Government
permitted Petitioners to inspect and obtain copies of certain of the seized patient files that
Petitioners asserted they needed immediately for patient treatment.
On July 22, 2013, the Court conducted a hearing on the motion for TRO. On July
23, 2013, the Court issued an Order granting in part and denying in part the TRO. See
Doc. No. 10, Case No. 1:13CV00107 AGF. In that ruling, the Court refused to order the
Government to return the seized patient files, based in part on the finding that Petitioners
had not met their burden to demonstrate either that Defendants’ actions were unlawful
under the Fourth Amendment or that Petitioners were likely to succeed on the merits.
The Court did require the Government to provide Petitioners with a redacted version of
the sealed affidavit in support of the search warrant.2 See id. Defendants were also
ordered to make files available to Petitioners for copying by Petitioners’ copy service on
a set schedule, and to file an affidavit regarding when the Government first began making
arrangements for its own copying service. The Court further advised Petitioners that it
would entertain a motion to recover some or all of their copying costs, and set a schedule
for filing a motion and briefing regarding the costs.
The Court withheld any ruling with respect to the attorney-client and work product
issues pending the parties’ briefing of those issues and further proceedings. In
connection with the documents claimed as privileged, the parties agreed to a procedure
that involved the use of a Taint Team and Chinese Wall process, such that only
Petitioners also sought the return of certain personal property seized at the time of the
search. By the date of the hearing, much of that property has been returned and
Petitioners agreed that only “the Andrassen File,” a personal file belonging to a physician
employed at one of the APC clinics, remained at issue. The Court ordered the parties to
attempt, in good faith, to resolve any dispute with respect to the return of the documents
from the Andrassen File and to present to the Court any dispute they were unable to
resolve. See Doc. No. 10. As of the date of this Order, the parties have not informed the
Court of any remaining dispute with respect to the Andrassen File. The Court assumes
that the parties successfully resolved that issue because they have presented nothing
further regarding this issue.
Government attorneys who would have no involvement in the prosecution would review
the documents at issue.
The Court also set a date for an evidentiary hearing on Petitioners’ broader Rule
41 Motion. Prior to the date scheduled however, Petitioners advised the Court that they
did not wish to present any further issues other than their request for return of the
documents claimed as privileged. On September 17, 2013, the Court heard argument
with respect to the privilege issues.
The sole remaining issues currently before the Court for determination are
Petitioners’ claim that certain designated documents claimed as privileged should be
returned, and Petitioners’ motion to recover the costs of copying seized patient files. For
the reasons set forth below, Petitioners’ request for return of the seized documents on the
ground of privilege shall be denied, and Petitioners’ motion to recover copying costs shall
be granted in part and denied in part.
Petitioner Adbul Naushad, M.D. (“Dr. Naushad”) owns and operates several APCs
in the Saint Louis vicinity and in Southeastern Missouri. On June 26, 2013, a team of
federal agents, task force officers, and state investigators, including local police and
agents from the Department of Health and Human Services and the Missouri Board of
Healing Arts, executed search warrants at six of the APCs.
The Patient Files
At the time of the search, the respondent federal agents seized approximately 800
APC patient files. There is no dispute that Petitioners had a need to access the APC
patient files, which contain imaging and other health information records, in order to treat
patients and to obtain payment for the services provided. In preparing to execute the
search warrants and conduct its investigation, the Government recognized that Petitioners
would need to access seized documents, in particular patient files, and the search
warrants described how Petitioners could inspect and obtain copies of the seized
In their initial Rule 41 Motions, Petitioners moved for the return of the original
copies of the patient files claiming that they had been seized improperly. Petitioners also
asserted that at a minimum, the Government should be required to provide copies of the
files as they were necessary to the conduct of APC’s business, and without the files
Petitioners would be unable to treat APC patients. See Doc. No. 1. After some dispute
regarding the manner in which copies would be made, the parties agreed that the
Government would provide copies of the patient files to Petitioners, giving priority to the
files of 137 patients who had upcoming appointments at the APCs. Initially, the
Government copied the files and provided the copies to Petitioners. The Government
was unable, however, to provide Petitioners with the requested patient files in a
The search warrants notified Petitioners that they could access and copy the seized
documents at their own expense, as follows:
DR. NAUSHAD, or someone he designates, may contact DEA Task
force Officer Tim Ware . . . to request access to the seized documents and
to have all or some of the documents copied at APC’s expense. If APC
requests portions of one or a few patient files, the files will be copied and
provided at no cost. Patients will be provided copies of their files at no cost
See, e.g., Search Warrant, Attach. B, at p. 4.
sufficiently prompt manner prior to the patients’ scheduled appointments. When the
Court requested that the Government accelerate its copying process, the Government
professed that it was unable to provide the copies more quickly because it did not have an
approved contract with a copying service to perform the copying on the Government’s
behalf. The Court therefore instructed both parties to cooperate to accelerate the copying
process. Petitioners arranged for their own copy service and the parties agreed to the
manner in which the copying would be performed. Due to the slow pace of the copying
up to that point, Petitioners had to arrange to have some of the patient files copied on an
The Government thereafter continued to allow Petitioners access to all seized
patient files and delivered batches of patient files to the copy service Petitioners had
arranged. In order to protect sensitive health information contained in the patient files
and to reduce the likelihood of unauthorized access to or disclosure of protected health
information, every effort was made to avoid leaving patient files overnight with the copy
service. After Petitioners advised the Court that the copy service was able to handle a
larger number of files in each daily batch, the Government increased the number of files
released on a daily basis for copying.
Although not required to do so, the Government elected to scan some of the seized
documents for ease of use during the investigation and any subsequent prosecution.
Government counsel advised Petitioners that the Government intended to scan the seized
documents and would provide Petitioners a copy of a disc containing the scanned files.
Government counsel further advised Petitioners that she did not know how long it would
take to complete the scanning. The Government’s process for securing a printing and
scanning contractor took longer than originally anticipated, but the record indicates that
the delays were outside of Government counsel’s control.4 On August 9, 2013, the
Government notified Petitioners’ counsel that the scanning had been completed and that
he could obtain the disc containing a copy of the scanned files.
The original patient files are, and have been available for inspection and copying
by Petitioners at the offices of the United States Department of Justice in the City of St.
Louis. Dr. Naushad and his wife, who also has an ownership interest in, and is involved
in the day to day management of the clinics, reside in St. Louis County, Missouri.
Petitioners’ attorneys also have their offices in St. Louis County. The six clinics that are
the subjects of the search warrant are between 36 and 200 miles from St. Louis; three of
the clinics are located within 70 miles of the City. Dr. Naushad regularly works at the
Advanced Pain Clinic in Festus, Missouri, which is about 36 miles from St. Louis.
The Files Claimed to be Privileged
During the search of the Festus APC, the Government also seized a binder
containing 564 documents labeled “Patient Complaints” and “Incident Reports” (“the
As directed by the Court, the Government submitted an affidavit from the DEA Chief
of Office Services. See Affidavit of DEA Chief of Office Services, Doc. No. 15 p.3. In
the affidavit, the DEA Chief of Office Services avers that the delay in completing the
scanning of the files was largely due to implementation of a new procedure related to
protecting individually identifiable health information. See id. at 4. The DEA Chief
described the various steps in the process, which includes the submission of a requisition
form and a statement of work (SOW) by the field office, approval of the funding request,
submission of a printing requisition to the Public Printer, submission of the SOW and
requisitions to the Government Printing Office, preparation of a Request for a Quote to
receive bids from approved GPO printing contractors, and the award of the contract. See
id. at 4-5.
Festus Binder”). The Government subsequently Bates-stamped these documents, which
are numbered 1 through 564. Petitioners have reviewed the Festus Binder and assert no
claim of privilege with respect to approximately 180 pages of documents in that Binder.
The Government also seized two similar binders containing incident reports and patient
complaints from the Sullivan and Farmington APCs (“the Sullivan Binder” and “the
Farmington Binder”). Together these two binders contain 280 pages of Bates-stamped
documents, which are numbered 565-844.
Pursuant to the Court’s Order of July 28, 2013, the Government instituted a Taint
Team and “Chinese Wall” process for review of the seized documents that Petitioners
assert are protected by the attorney-client privilege and work product doctrine. See Doc.
No. 10. The process involved designation of separate attorneys from the United States
Attorney’s office (the “Privilege Team”) to review and address the privilege issues. The
procedures assured that the Government attorneys involved in the investigation and
prosecution would neither see nor discuss the documents at issue, and the Privilege Team
would neither participate in nor discuss the prosecution. Assistant United States Attorney
Howard J. Marcus was assigned as lead attorney on the Privilege Team.
A hearing was held on September 17, 2013, at which counsel for Petitioners and
attorneys from the Privilege Team presented argument. Copies of the documents at issue
were also provided to the Court for in camera review.
Following the Privilege Team’s review of the 564 pages of Bates-stamped
documents in the Festus Binder, the Government agreed to return 15 of those documents
conceding that these documents constitute protected attorney work-product. The
Government also concedes that pages 554 through 560 of the Festus Binder should be
returned to Petitioners as they are subject to the attorney-client privilege in light of their
disclosure at one point, to counsel for Petitioners’ insurance carrier.
II. Documents Claimed to be Privileged
A. Applicable Law
1. Attorney-Client Privilege
‘“[T]he common law–as interpreted by United States courts in light of reason and
experience–governs [the claim of attorney-client privilege]” here. Fed. R. Evid. 501; see
also United States v. Yielding, 657 F.3d 688, 706 (8th Cir. 2011); Baranski v. United
States, No. 4:11-CV-123 CAS, 2012 WL 425007, at *3 (E.D. Mo. Feb. 9, 2012).
The attorney-client privilege extends to confidential communications made for the
purpose of facilitating the rendition of legal services to a client. See Yielding, 657 F.3d at
707 (citing United States v. Horvath, 721 F.2d 557, 561 (8th Cir. 1984)). “A
communication is made for the purpose of obtaining or providing legal assistance . . . if it
is made to or to assist a person . . . who is a lawyer or who the client or prospective client
reasonably believes to be a lawyer . . . .” Restatement (Third) of the Law Governing
Lawyers § 72(1) (2010).
Petitioners, as the holders of the privilege, bear the burden of demonstrating that
the privilege is applicable to the documents at issue. See Hollins v Powell, 773 F.2d 191,
196 (8th Cir. 1985). The validity of any claim of attorney-client privilege turns on the
existence of an attorney-client relationship. See Horvath, 721 F.2d at 561 (stating that a
communication will not be privileged unless it was “made for the purpose of facilitating
the rendition of legal services to the client”).
2. Work Product Doctrine
“Historically, a lawyer’s mental impressions, conclusions, opinions, and legal
theories have been afforded substantial protection in order to secure the lawyer’s
effective advocacy and representation of his or her clients’ interests.” In re Grand Jury
Proceedings, G.S., F.S., 609 F.3d 909, 916 (8th Cir. 2010) (Bye, Circuit J., concurring in
part and dissenting in part) (citation omitted). The work product doctrine restricts the
access of an opponent to materials “prepared in anticipation of litigation or for trial.”
Fed. R. Civ. P. 26(b)(3); see also Hickman v. Taylor, 329 U.S. 495, 511 (1947)
(explaining that the work product doctrine applies to “materials obtained or prepared by
an adversary’s counsel with an eye toward litigation”).
There are two types of work product, opinion and non-opinion or fact work
product. See In re Grand Jury Proceedings, G.S3and F.S., 609 F.3d at 913. Opinion
work product “encompasses a lawyer’s opinions, conclusions, mental impressions, and
legal theories. . . .” Id. Non-opinion or fact work product is “raw data collected in the
course of litigation and included in an attorney’s file.” Baker v. General Motors Corp.,
209 F.3d 1051, 1054 (8th Cir. 2000). Regardless of the type of work product at issue, the
threshold question governing application of the doctrine is whether the contested
documents were prepared in anticipation of litigation. Binks Mfg. Co. v. Nat’l-Presto
Indus., Inc., 709 F.2d 1109, 1118 (8th Cir. 1983). The mere possibility that litigation
may result is not sufficient to trigger the protection of the work product doctrine. Id. at
1119; see also Diversified Indus., Inc. v. Meredith, 572 F.2d 596, 604 (8th Cir. 1977)
- 10 -
(holding that more than a remote prospect of future litigation is required to trigger work
product protection). “[M]ore than a remote prospect” is required because
[p]rudent parties anticipate litigation, and begin preparation prior to the
time suit is formally commenced. Thus the test should be whether, in light
of the nature of the document and the factual situation in the particular case,
the document can fairly be said to have been prepared or obtained because
of the prospect of litigation. But the converse of this is that even though
litigation is already in prospect, there is no work product immunity for
documents prepared in the regular course of business rather than for
purposes of the litigation.
Id. (internal quotation omitted). Finally, as with claims of attorney client privilege, the
parties claiming protection under the doctrine bear the burden of establishing the
requisites for its application. See Hickman, 329 U. S. at 512.
B. Arguments of the Parties
At the hearing, Petitioners requested the return of the remaining 375 pages of
documents from the Festus Binder and the 274 pages of documents in the Sullivan and
Farmington Binders on the ground that they are protected by the attorney-client privilege
or work product doctrine. Petitioners contend that the documents are privileged because
an attorney had once advised them to create incident reports, in a format provided by that
attorney, whenever there was an incident that might lead to litigation. The documents at
issue are incident reports that were prepared by employees of APC regarding such
matters as complaints by patients, incidents, such as a fall, regarding a patient, and
employee disputes. Petitioners concede that no attorney ever saw or reviewed these
documents, with the exception of pages 554 through 560, prior to the execution of the
- 11 -
In response, the Government asserts that pages 1 through 553 and 561 through 564
of the Bates-stamped documents are not protected by the attorney-client privilege or work
product doctrine because they are not associated with an attorney client relationship or
were not prepared in anticipation of litigation. Rather, these documents are in-house
reports related to employee and patient misconduct, the “firing” of patients, work-place
accidents, patient complaints, and medical mistakes. The bulk of these documents are
entitled “Advanced Pain Center Adverse Incident Report.” Some of the forms appear to
have been downloaded from the Internet and although some of them carry the label
“Attorney Client Privileged Document Anticipation of Litigation,” the Government
contends the documents do fall within either privilege as they were not discussed with
counsel nor specifically prepared at the direction of counsel in anticipation of litigation.
Upon review of the parties’ arguments, the affidavits and exhibits submitted by the
parties at the hearing, and in camera review of the documents at issue, the Court
concludes that none of the disputed documents are subject to the attorney-client privilege.
In support of their claim of privilege, Petitioners assert that some years ago, in aftermath
of other litigation, an attorney prepared a form incident report for them and advised
Petitioners’ Compliance Officer to complete the forms “in anticipation of litigation” and
to use it to record incidents that might arise in the day-to-day operation of the practice.
Notably, Petitioners do not assert that they have a present or continuing relationship with
that attorney. In fact, it is undisputed that prior to the execution of the search warrant
neither the completed Adverse Incident Reports, nor their contents had ever been
- 12 -
communicated to or reviewed by an attorney. Finally, Petitioners apparent argument that
the labeling of some of the documents as “Attorney-Client Privileged” renders those
documents privileged is without merit.
In the absence of an existing attorney client relationship relating to the documents
or a showing by Petitioners that the documents at issue were ever communicated to an
attorney for purposes of obtaining legal advice, the Court cannot conclude that any of the
disputed documents are subject to the attorney-client privilege. Hollins v Powell, 773
F.2d at 196; Horvath, 721 F.2d at 561. Petitioners do not contend, much less establish,
that the forms were completed or reviewed by counsel. Hollins v Powell, 773 F.2d at
196. Nor have Petitioners asserted that the information on the forms at issue was ever
discussed with any attorney. In addition, it has long been established that the mere
labeling of a document or the use of a form prepared by an attorney is not sufficient to
convey the protection of the attorney-client privilege. See Hickman, 329 U. S. at 512.
The Court further concludes that the contested documents are not subject to either
variant of the work product doctrine. Petitioners have not satisfied their burden to show
that the documents were prepared by, or at the behest of, an attorney and in reasonable
anticipation of litigation. Petitioners’ practice of marking each incident report with the
phrase “Prepared in Anticipation of Litigation” does not magically convert the document
to attorney work product. Indeed, many of the reports were completed many years ago,
and Petitioners cannot show any reasonable basis for claiming any litigation is anticipated
with respect to these matters.
Petitioners’ contention that the generic incident report forms are subject to the
- 13 -
work product doctrine because the form was prepared by an attorney also lacks merit.
The record indicates that in the course of the operation of the APCs many different
individuals including medical assistants, receptionists, compliance officers, and
physicians filled out the forms in the wake of every day mishaps and incidents of many
types. The very fact that the incident reports were used in so many different types of
situations by personnel with varying qualifications strongly suggests that they were
prepared as part of the day-to-day operation of the APCs and not in anticipation of
litigation. See Diversified Indus., Inc., 572 F.2d at 604 (holding that there is no work
product immunity for documents prepared in the regular course of business rather than
for purposes of the litigation); Love v. Sears Roebuck and Co., No. 3-13-CV-402-S, 2014
WL1092270, at *2 (holding that incident reports were not prepared in anticipation of
litigation where they were prepared as part of general policy to record incidents rather
than specific concern about litigation). To the extent that the reports were completed in
recognition of the mere possibility that the numerous types of incidents of varying
degrees of severity might result in litigation, that possibility is not sufficient to warrant
the application of the work product doctrine here. Id.
Accordingly, the Privilege Team shall return to Petitioner the fifteen documents
the Government previously agreed to return, and the documents numbered 554-560, and
shall not discuss the contents of these documents with anyone, including the attorneys
and agents involved in the investigation and prosecution of the case. Except with respect
to these documents, Petitioners’ motion to return documents based on a claim of attorneyclient or work privilege is denied.
- 14 -
III. Copying Costs
A. Applicable Law
Absent exceptional circumstances, the Government is not required to bear the
costs of copying documents lawfully seized pursuant to a valid search warrant.5 See
225,1468 and 1470 Statler Towers, 197 Delaware Avenue v. United States (Statler
Towers), 787 F.2d 796, 799 (2d Cir. 1986) (citing Federal Rule of Criminal Procedure 16
and holding that “[a]bsent exceptional circumstances,” a party who unsuccessfully moves
before indictment for return of property seized under a warrant bears “the burden of
duplicating costs”);6 Delta Engr. v. U.S., 41 F.3d 259, 263 (6th Cir. 1994) (holding that
the Government’s refusal to pay for copying documents seized from an engineering
business was “substantially justified” because Rule 41(g) does not require the
government to bear copying costs).
Most federal courts considering the issue have refused to place responsibility on
the Government for the costs of copying lawfully seized documents. See, e.g., Bennett,
2013 WL 3821625, at *8-9 (concluding that owner of seized documents who was not
The Court has not found and the parties have not offered any Eighth Circuit case law
addressing the issue of who must bear the cost of copying lawfully seized documents for
use by the owner of the documents.
The Second Circuit recognized that Rule 16 governs criminal discovery and does not
apply to pre-indictment motions such brought under Rule 41(e). Nonetheless, the court
noted that Rule 16 “provides a useful analogy” for resolving the issue of copying costs.
The court further observed that in the discovery context, the clear import of Rule 16 is
that the non-indigent criminal defendants must pay the cost of copying documents legally
held by the government. Thus the court concluded “[t]here is no reason not to follow the
same general rule in the context of a failed pre-indictment challenge to the validity of a
seizure.” Id. at 798.
- 15 -
indigent and had not demonstrated that bearing the costs of duplicating the seized
documents would be an “undue hardship” must do so at his own expense); 55 W. 47th St.,
Suites 620 & 650 v. United States, 712 F. Supp. 437, 441 (S.D.N.Y. 1989) (stating with
regard to seized documents that “Rule 41[(g)] mandates that the Government either return
or retain property; it does not obligate the Government to furnish copies of the seized
property, much less to pay for such copying.”) (citation omitted); 6600 Long Island
Expressway, Suites 104 & 105, No. 88–0906 M, 1988 WL 142662, at *2 (E.D.N.Y. Dec.
28, 1988) (finding that the Government was not required to pay the expense of copying
documents seized from a marketing company because it was “under no legal obligation to
return the documents” and the document owner had not demonstrated any “extraordinary
circumstances which would shift the burden of this expense to the United States”).
Courts have identified, however, certain factors that, in combination, constitute
“exceptional circumstances” justifying an award of copying costs to the owner of seized
documents. For example, the court in In re Search Warrants Concerning Nat’l Ins.
Consultants Inc. (Nat’l Ins. Consultants), 139 F.R.D. 684 (D. Colo. 1991), observed that
the following factors were present in that case.
First, there [was] no indication that an on-going grand jury
investigation [was] in progress. Second, the affidavit remain[ed] sealed,
and the real parties [were] at a disadvantage in seeking return of the original
documents. Third, the property seized [had] been moved to Kansas City,
some four hundred and fifty miles from [the] Court and the real parties in
interest. Fourth, no grand jury indictment [had] been returned or is
anticipated within a reasonable period of time, as so stated by counsel for
the Government. Fifth, there [was] no dispute that the files of clients are
necessary for payment of medical claims under the plans. Sixth, there [had]
been no determination made that the property seized should not be returned.
- 16 -
Seventh, almost four months [had] elapsed since the seizure of the items
and no indictment has been returned.
Id. at 687.
After recognizing the general rule set forth in Statler Towers, that the government
should not bear the cost of copying seized documents, the court held that the factors set
out above gave rise to “exceptional circumstances” justifying an award of costs to the
defendants in that case. See id. The court relied heavily on the fact that the government
had stored the seized documents at a location some 450 miles away from defendants and
found that this circumstance imposed an additional “substantial cost of transport for the
. . . parties to inspect the files and insure that copies [were] complete.” Id. Therefore, the
court concluded that imposing travel and copying costs on defendants was “inequitable”
and a significant departure from the “equities” present in Statler Towers. Id.
The court also noted that at the time of the request, a grand jury indictment had not
issued, no ruling had issued with respect to the return of the files and the search warrant
affidavit remained under seal, which made it more difficult for the defendants to pursue
return of the property. Id. Finally, the court reasoned that the government rather than the
defendants had chosen “to undertake a criminal investigation rather than utilizing civil
remedies, such as injunction, to close the [defendants’] business” and that lack of access
to the documents would harm both the defendants and their clients. Id.
Petitioners contend that exceptional circumstances justify an order requiring the
Government to bear those copying costs which totaled $9,579.15 at the time this motion
- 17 -
was filed. Doc. No. 18-1. Petitioners assert that the factors identified in Nat. Ins.
Consultants are present in this case and give rise to exceptional circumstances justifying
an award of copying costs to Petitioners. Having reviewed those factors and the
circumstances of this case, the Court concludes that Nat’l. Ins. Consultants is
distinguishable from this case in several respects. Therefore, the Court finds no reason to
depart from the general rule that the Government does not bear the costs of copying
Specifically, in this case, unlike Nat’l Ins. Consultants, the Government asserts
that there is an ongoing grand jury investigation, which began prior to the execution of
the search warrant. In addition, the search of the clinics took place only six weeks, rather
than four months, before the filing of this motion. At that juncture, the Government had
not had sufficient time to review the seized documents and its continued need for the
documents as well as the absence of an indictment were reasonable. Perhaps most
importantly, the patient files in this case were stored and available for inspection in the
City of Saint Louis in close proximity to Dr. Naushad’s residence and the offices of his
attorneys. Moreover, Petitioners do not assert and there is no indication that they are
indigent or that any unusual financial circumstances warrant an exception to the general
rule regarding copying costs.
Finally, at the time of the court’s opinion in Nat’l Ins. Consultants the search
warrant affidavit remained under seal and the court had not ruled with respect to the
request for return of the seized documents. In this case, however, the Court has denied
the Petitioners’ request for a preliminary injunction mandating return of the patient files
- 18 -
and Petitioners have been given a redacted copy of the sealed search warrant affidavit.
Petitioners are not disadvantaged with respect to their Rule 41(g) motion because, unlike
the defendants in Nat’l. Ins. Consultants, they had access to the information necessary to
pursue their arguments concerning return of the documents and the validity and proper
execution of the search warrant. On the basis of the foregoing, the Court concludes that
the factors identified in Nat’l Ins. Consultants are not present here.
Nonetheless, the Court concludes that one aspect of the circumstances here
justifies shifting responsibility to the Government for a minor portion of the copying
costs, attributable to expediting the copying of the first group of documents. At the time
the Government executed the search warrants, it knew that it was seizing patient files
from active medical facilities, and could reasonably anticipate that APC would need to
have access to some significant number of files for patient treatment. Although the
Government was not unreasonable in refusing simply to return the files to Petitioners for
copying, it also had not put any arrangements in place for it to copy those files within the
time frame required for continued treatment and care of APC patients. The effect on
patients–third parties in no way responsible for the alleged criminal activity–of the delay
in copying should have been given greater consideration.
The Court finds that the Government did not act in bad faith. Nevertheless, the
Government’s failure to make arrangements with a copy service at or near the time the
search warrants were executed placed Petitioners in the position of having to arrange to
have a portion of the first group of documents—needed for immediate patient care—
copied on an expedited basis. And the Court believes it would be unfair to require
- 19 -
Petitioners to bear this additional portion of the copying costs. The documentation
Petitioners submitted does not indicate a breakout of the copying expenses, but the Court
estimates the cost of expediting the copying of these files at $750.00 and will award that
amount to Petitioners. See Doc. No. 18-1.
Finally, although they do not tie their argument to the legal authority they cite,
Petitioners assert the Government’s conduct with respect to the production of the seized
patient files and retention of a copy service to copy or scan the seized documents was
dilatory and dishonest. Upon review of the record, the DEA affidavit, and the
circumstances related to the scanning and copying processes, the Court finds no basis to
conclude that the Government purposefully engaged in delaying tactics or failed to act in
good faith. Further, the Court notes that Petitioners also contributed to the delay by their
own positions prior to and during the early portion of the Court’s involvement.
IT IS HEREBY ORDERED that Petitioners’ motion for an order requiring the
return of certain seized documents on the ground that they are protected under the
attorney-client privilege and work product doctrines is DENIED. (Doc. No. 1.)
IT IS FURTHER ORDERED that Petitioners’ motion to recover copying costs
(Doc. No. 18) is GRANTED in part and DENIED in part as follows:
a) the Government shall reimburse Petitioners for $750.00 of the copying
costs they incurred, and
- 20 -
b) Petitioners shall bear the remainder of the requested copying costs.
AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 31st day of March, 2014.
- 21 -
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?