In re Grand Jury Subpoena

          Argued and Submitted October 16, 2017 San Francisco, California

         Appeal from the United States District Court for the District of Arizona Diane J. Humetewa, District Judge, Presiding D.C. No. 2:17-mc-00036-DJH

          Eric D. Miller (argued), Nicola C. Menaldo, and Todd M. Hinnen, Perkins Coie LLP, Seattle, Washington, for Movant-Appellant.

          Andrew C. Stone (argued) and Gary M. Restaino, Assistant United States Attorneys; Krissa M. Lanham, Deputy Appellate Chief; Elizabeth A. Strange, Acting United States Attorney; United States Attorney's Office, Phoenix, Arizona; for Appellee.

          Kurt Wimmer and Jadzia Butler, Covington & Burling LLP, Washington, D.C.; Sophia Cope, Electronic Frontier Foundation, San Francisco, California; for Amici Curiae Center for Democracy & Technology, Committee for Justice, Electronic Frontier Foundation, Media Alliance, and Public Participation Project.

          Before: Richard C. Tallman and Consuelo M. Callahan, Circuit Judges, and David A. Ezra, ^[*] District Judge.

         SUMMARY ^[**]

         Subpoena / First Amendment Rights

         The panel affirmed the district court's denial of Glassdoor, Inc.'s motion to quash a grand jury subpoena duces tecum that would require Glassdoor to disclose the identifying information of eight users who posted anonymous reviews about another company on its Internet website; and sustained the contempt order entered to enforce it.

         Glassdoor argued that complying with the subpoena would violate its users' First Amendment rights to associational privacy and anonymous speech.

         The panel held that to determine whether the subpoena violated the First Amendment, the proper test on the record of this case was the good-faith test the Supreme Court established in Branzburg v. Hayes, 408 U.S. 665 (1972). The panel rejected Glassdoor's contention that the district court should have applied the compelling-interest test laid out in Bursey v. United States, 466 F.2d 1059 (9th Cir. 1972).

         The panel held that because Glassdoor had neither alleged nor established bad faith on the part of the government in its investigation, under Branzburg, enforcement of the subpoena duces tecum to identify potential witnesses in aid of its inquiries did not violate the First Amendment rights of Glassdoor's uses. The panel further held that Glassdoor had not shown that any other evidence was necessary to rule on its objection.

          OPINION

          TALLMAN, CIRCUIT JUDGE:

         Glassdoor, Inc. appeals the denial of its motion to quash a grand jury subpoena duces tecum that would require Glassdoor to disclose the identifying information of eight users who posted anonymous reviews about another company on its Internet website, Glassdoor.com. Glassdoor argues that complying with the subpoena would violate its users' First Amendment rights to associational privacy and anonymous speech. It contends that the district court should have applied the compelling-interest test we laid out in Bursey v. United States, 466 F.2d 1059 (9th Cir. 1972), to determine whether the subpoena violates the First Amendment. The government argues that the good-faith test the Supreme Court established in Branzburg v. Hayes, 408 U.S. 665 (1972), controls.

         We agree that on the record before us, Branzburg, which was decided the day before we issued Bursey, supplies the proper test. Because there is no evidence that the grand jury's investigation of fraud, waste, and abuse by a third party in performing a government contract is being conducted in bad faith, we affirm the denial of the motion to quash, and we sustain the contempt order entered to enforce it.

         I

         Glassdoor, Inc. operates Glassdoor.com, a website where employers promote their companies to potential employees, and employees post reviews of what it's like to work at their companies. In these reviews, employees rate their employers in a variety of categories and describe workplace environments, salaries, and interviewing practices.

         The reviews on Glassdoor.com are anonymous. But to post reviews, users must first provide Glassdoor with their e-mail addresses, though the addresses do not appear on the site. Before Glassdoor accepts a posting, the contributor is warned his or her information may be disclosed when required by law, either through a subpoena or court order. Glassdoor's Terms of Use incorporate a Privacy Policy that assures users the company generally "do[es] not disclose . . . individual account or usage data to third parties." But the Privacy Policy expressly warns users that Glassdoor "will disclose data if we believe in good faith that such disclosure is necessary . . . to comply with relevant laws or to respond to subpoenas or warrants or legal process served on us." Finally, Glassdoor's Terms of Use also inform users that Glassdoor reserves the right "to take appropriate action to protect the anonymity of [its] users against the enforcement of subpoenas or other information requests." The company is attempting to do that here in the face of an ongoing federal criminal investigation.

         An Arizona federal grand jury is investigating a government contractor that administers two Department of Veterans Affairs (VA) healthcare programs. The grand jury is examining whether the subject^[1] of its inquiries has committed wire fraud and misused government funds in violation of 18 U.S.C. § 1343 and 18 U.S.C. § 641, respectively.

         As of March 2017, current and former employees of the subject company had posted 125 reviews on Glassdoor.com. Many of the reviews criticize the subject's management and business practices. For example, one anonymous employee wrote that it "[m]anipulate[s] the system to make money unethically off of veterans/VA." Another asserted that "[t]here's a real disconnect between how this program runs and how the VA thinks the program runs."

         On March 6, 2017, the government served Glassdoor with a subpoena that ordered it to provide the grand jury with "Company Reviews" and associated "reviewer information" for every review of the subject on Glassdoor.com. The requested "reviewer information" included "internet protocol addresses and logs associated with all reviews including date and time of post, username, email address, resume, billing information such as first name, last name, credit card information, billing address, payment history, and any additional contact information available." The government attached eight "exemplar reviews, " all of which were critical of the subject.

         Glassdoor notified the government that it believed "the scope of the request raise[d] issues associated with the First Amendment." The government agreed to limit its request to the reviewer information associated with just the eight exemplar reviews, and it told Glassdoor the information would enable it "to contact those reviewers as third party witnesses to certain business practices relevant to [its] investigation." Glassdoor maintained its objection to the subpoena and filed a motion to quash.

         The district court denied Glassdoor's motion. It held that Bursey's compelling-interest test was inapplicable because the facts of Bursey were distinguishable. Applying Branzburg, it held that Glassdoor had not shown the grand jury investigation was being conducted in bad faith, and it ordered Glassdoor to respond to the subpoena on pain of contempt.

         Glassdoor chose to bring a recalcitrant witness appeal rather than comply with the subpoena. 28 U.S.C. § 1826. The parties stipulated to a judgment of civil contempt and sanctions of $5, 000 per day until Glassdoor fully complies by producing the requested information. The district court entered an order in accordance with the stipulation of contumacious conduct and stayed enforcement of the monetary sanctions pending resolution of this appeal. We have jurisdiction under 28 U.S.C. § 1291.

         II

         We review the district court's denial of a motion to quash a grand jury subpoena, as well as the district court's imposition of contempt sanctions, for abuse of discretion. See In re Grand Jury Subpoena (Mark Torf/Torf Envtl. Mgmt.), 357 F.3d 900, 906 (9th Cir. 2004) (denial of motion to quash); In re Grand Jury Proceedings, 33 F.3d 1060, 1061 (9th Cir. 1994) (per curiam) (contempt).

         "[M]ixed questions of law and fact contained within the analysis of a civil contempt proceeding" are reviewed de novo. In re M.H., 648 F.3d 1067, 1070-71 (9th Cir. 2011). The district court's "underlying factual findings are reviewed for clear error." Mathews v. Chevron Corp., 362 F.3d 1172, 1180 (9th Cir. 2004).

         III

         Glassdoor argues that the grand jury subpoena violates its users' First Amendment rights in two ways: it infringes on their right to associational privacy and their right to anonymous speech.^[2]

         Implicit in the First Amendment is a "right to associate for the purpose of engaging in those activities protected by the First Amendment." Roberts v. United States Jaycees, 468 U.S. 609, 618 (1984). Because there is a "vital relationship between freedom to associate and privacy in one's associations, " in some circumstances, forcing organizations to disclose their members' identities ...