## Facts

- Stephen Ralls, Esq., a criminal defense attorney, was retained by an unidentified third-party fee payer to represent Philip Bonnette at Bonnette’s initial appearance and detention hearing.
- Bonnette and Victor Tarrazon‑Orduno had been arrested in connection with an attempted transport of approximately 300 pounds of cocaine from Arizona to California.
- A federal grand jury issued a subpoena to Ralls seeking (1) the name of the person who hired him, (2) the amount paid, (3) the method of payment, (4) whether a retainer agreement existed, and (5) the substance of Ralls’s conversations with the fee payer.
- Ralls moved to quash the subpoena, asserting attorney–client privilege, and submitted a sealed affidavit to support the claim of privilege.
- The district court partially denied the motion: it ordered Ralls to disclose the fee payer’s identity and fee/retainer details, but held that the substance of conversations between Ralls and the fee payer was privileged.
- Ralls initially attempted to appeal, but the appeal was dismissed for lack of jurisdiction because there was not yet a contempt finding and therefore no final, appealable order.
- Ralls continued to refuse to provide the ordered identity and fee information, and the district court subsequently entered an order allowing intervention on behalf of the fee payer or, alternatively, finding Ralls in contempt for noncompliance.
- Ralls appealed the partial denial of the motion to quash and the contempt order.

## Issues

1. Whether attorney–client privilege barred enforcement of a grand jury subpoena seeking a third-party fee payer’s identity and fee/retainer information when, on the record presented, disclosure would reveal confidential communications.
2. Whether the contempt order could stand when it was based on refusal to provide information found to be privileged.

## Decision

- The Ninth Circuit reversed the district court’s partial denial of the motion to quash.
- After reviewing Ralls’s sealed affidavit, the court held that, in this case, the fee payer’s identity and the fee arrangements were inextricably linked to privileged communications and therefore protected by the attorney–client privilege.
- The court ordered the subpoena quashed in its entirety on privilege grounds.
- The court reversed the contempt order because the subpoena, as applied, sought privileged information.

## Legal Principles

- The attorney–client privilege protects confidential communications between lawyer and client made for the purpose of obtaining or providing legal advice.
- As a general rule, a client’s identity and the nature of fee arrangements are not privileged because they are usually not treated as confidential communications.
- An exception applies when disclosure of identity or fee information would effectively disclose the substance of a confidential attorney–client communication; in that situation, the identity and fee information may be privileged because they are bound up with protected communications.
- A court may consider record materials submitted under seal to evaluate whether the identity/fee request would reveal confidential communications in the specific setting presented.
- A contempt sanction based on refusal to comply with a subpoena cannot stand if the subpoena compels disclosure of information protected by attorney–client privilege.

## Conclusion

The Ninth Circuit held that, although client identity and fee details are ordinarily not privileged, Ralls’s sealed showing established that the fee payer’s identity and fee arrangements would reveal confidential communications in this particular matter. It therefore reversed the partial denial of the motion to quash, ordered the grand jury subpoena quashed in full, and reversed the contempt order entered against Ralls for refusing to disclose the protected information.


Ralls v. United States, 52 F.3d 223 (1995)