As in Donaldson, then, where we refused to draw the line between permissible civil and impermissible criminal purposes at the entrance of the special agent into the investigation, 400 U.S. at 536, 91 S. Ct. 534 (at 545, 27 L. Ed. 2d 580), we cannot draw it on the basis of the agent's personal intent. To do so would unnecessarily frustrate the enforcement of the tax laws by restricting the use of the summons according to the motivation of a single agent without regard to the enforcement policy of the Service as an institution. Furthermore, the Inquiry into the criminal enforcement objectives of the agent would delay summons enforcement proceedings while parties clash over, and judges grapple with, the thought processes of each investigator.17 See United States v. Morgan Guaranty Trust Co., (572 F.2d 36 (2d Cir. 1978)) supra. This obviously is undesirable and unrewarding. As a result, the question whether an investigation has solely criminal purposes must be answered only by an examination of the institutional posture of the IRS. Contrary to the assertion of respondents, this means that those opposing enforcement of a summons do bear the burden to disprove the actual existence of a valid civil tax determination or collection purpose by the Service. After all, the purpose of the good-faith inquiry is to determine whether the agency is honestly pursuing the goals of § 7602 by issuing the summons. (Emphasis supplied.)

Without doubt, this burden is a heavy one. Because criminal and civil fraud liabilities are coterminous, the Service rarely will be found to have acted in bad faith by pursuing the former. On the other hand, we cannot abandon this aspect of the good-faith inquiry altogether.18 We shall not countenance delay in submitting a recommendation to the Justice Department when there is an institutional commitment to make the referral and the Service merely would like to gather additional evidence for the prosecution. Such a delay would be tantamount to the use of the summons authority after the recommendation and would permit the Government to expand its criminal discovery rights. Similarly, the good-faith standard will not permit the IRS to become an information gathering agency for other departments, including the Department of Justice, regardless of the status of criminal cases.

At oral argument before us, government counsel indicated that the taxpayer's burden to show lack of good faith is so great that a district court need seldom if ever hold an evidentiary hearing before enforcing a § 7602 summons. We reject that position, as did the Supreme Court in LaSalle (n. 17, n. 19), because there are instances in which such a hearing will clearly be required.

Such was the case in United States v. McCarthy, 514 F.2d 368 (3rd Cir. 1975) in which defendants stated with sufficient particularity factual support for their allegations that the IRS "had no intention of pursuing any civil remedies" (; at 375)26 and also that the IRS, having made one inspection of the records sought, was harassing the defendants in seeking a second inspection (; at 375-76). And see, in a different context, Lord v. Kelley, 223 F. Supp. 684, 689 (D.Mass.1963), Appeal dismissed on other grounds, 334 F.2d 742 (1st Cir. 1964) in which Judge Wyzanski in the District Court wrote (223 F.Supp. at 689-690):

When a special agent of the Internal Revenue Service tells an accountant who, so far as appears, is quite innocent of wrongdoing, that unless he turns over his clients' records and cooperates with the Internal Revenue Service the accountant will be in trouble, the agent is close to extortion.

In United States v. McGuirt, 588 F.2d 419 (4th Cir. 1978), the District Court, after conducting an evidentiary hearing, refused to enforce a § 7602 summons. Reversing, Judge Hall wrote (at 422) that "inconvenience is not harassment" and did not, in McGuirt, add up to bad faith. In this case, no recommendations have seemingly been made by IRS to the Department of Justice for criminal prosecution of any of the persons under investigation. There are no allegations that the IRS is not interested in the civil aspects of the tax liability of DiBiasi and the four persons questioned with him. There are only allegations of bad faith because of the failure to warn targets or potential targets, and because of the discussion of immunity, all according to DiVivo in violation by the IRS of its own regulations. The failure to warn DiBiasi and the four others hardly in and of itself shows any bad faith. The violation by the IRS of its own regulations, which at trial does not necessarily provide a basis for the application of the exclusionary rule in the absence of a deliberate or prejudicial violation or the denial of a constitutional or statutory right, See United States v. Caceres, 440 U.S. 741, 752, 754, 99 S. Ct. 1465, 1472, 1473, 59 L. Ed. 2d 733, 744, 745 (1979), is also not proof by itself of bad faith in a tax investigation. As to the immunity discussion, the attorney for DiBiasi, in an affidavit, has stated that during the telephone conversation on April 13, 1978, "the subject of immunity arose."27 Even assuming that the IRS agent in charge of the DiVivo investigation first raised the subject of immunity and even noting that the IRS Manual instructed agents in terms of "conduct to be avoided" they are to refrain from "statements or questions which may be construed as offers of immunity or attempts to settle civil liabilities in pending criminal cases,"28 the IRS is expressly provided with authority to allow both criminal and civil immunity in return for testimony against another. See United States v. Barrett, 505 F.2d 1091, 1101-02 (7th Cir. 1974) in which 18 U.S.C. § 6002 re criminal immunity and 26 U.S.C. § 7122 were discussed. While it is true that in Barrett, the immunity arrangements were made after reference to the Attorney General for prosecution, the parties to the discussions apparently believed that IRS approval was required. In Barrett, Judge Sprecher wrote (at 1102):

The significance of section 7122 for defendant is that the end the government was seeking to accomplish Meyers' exemption from civil tax liability was authorized by law. If the government can excuse criminal or civil liability in settling a criminal case, surely it can use that power of compromise to obtain guilty pleas or to procure testimony in other proceedings. Both are legitimate objectives of plea bargaining.29

It is true that in Powell the Supreme Court has stated that "put(ting) pressure on (a taxpayer) to settle a collateral dispute" (379 U.S. at 58, 85 S. Ct. at 255) is an example of bad faith in the use of a § 7602 summons. But that was written in the context of a case in which the Court was discussing alleged repetitive inspections by the IRS and does not mean that settlement or compromise or even immunity approaches in and of themselves indicate lack of good faith use of a § 7602 summons to aid in civil tax collection.

Careful examination of the record reveals that if Judge Blair had followed his inclination expressed near the end of the evidentiary hearing he conducted and had held that there were insufficient allegations by DiVivo to require any further evidentiary inquiry, he would not have been in error. While the District Court's termination herein of the evidentiary hearing may not rest on lack of standing on the part of DiVivo, that termination was fully justified. By the time Judge Blair ended the hearing, he had heard the lengthy proffer from counsel for DiVivo as well as considerable testimony from the special agent in charge of the DiBiasi investigation which disclosed that DiVivo's attack on the good faith of the IRS investigation was without merit.

Powell speaks to the need of a Court "not (to) permit its process to be abused." United States v. Powell, supra, at 58, 85 S. Ct. at 255. Since DiVivo was named in the summons and therefore has standing to intervene in this case, DiVivo may bring the abuse-of-court-process contention to the District Court's attention and ask the District Court not to ignore the same, even if the abuse complained of involves no violation of any right of DiVivo. But, even so assuming, DiVivo's allegations, proffers and contentions, if accepted as factually accurate, and giving DiVivo the benefit of all reasonable inferences add up only to the following: (1) That the IRS was principally and primarily interested in DiVivo and only secondarily interested in DiBiasi and certain other partners or associates of DiVivo, and (2) that the IRS would not have investigated any of those persons other than DiVivo if the IRS had not been investigating DiVivo or if one or more or all of those others had cooperated with the IRS against DiVivo. Assuming those facts, such conduct hardly constitutes an abuse of the process of the District Court. There are many criminal cases in which minor defendants are named who would not have been singled out and prosecuted but for the Government's prosecutorial decision to proceed against the major participant or participants. The inclusion of certain minor defendants is often sought by the prosecutor in the hope that one or more of them will enter into agreements to cooperate with the government in return for an undertaking by the government to seek a dismissal or to recommend leniency. Such practices, which have not been deemed inappropriate, See generally Bordenkircher v. Hayes, 434 U.S. 357, 98 S. Ct. 663 (1978), would not seem different than those involved herein. At no time has DiVivo suggested, except once30 in a single isolated conclusory oral assertion by counsel, that the civil tax investigations of DiBiasi and the others were themselves phony, I. e., that there was no factual basis upon which the IRS could have conducted an investigation to determine whether DiBiasi and the others, as admitted partners and associates of DiVivo, violated any of their respective civil tax duties and that the IRS did not decide to conduct such investigations. Perhaps, with 20-20 hindsight, the District Court might have required the Government, before terminating the hearing, to file, In camera, an affidavit by Mr. Bell or one or more others, pursuant to Federal Civil Rule 56, giving some details as to the alleged civil tax violations of DiBiasi and the others and the IRS's reasons for investigating those possible violations. But even the use of such summary-type procedures must be carefully tailored to prevent delay of "summons enforcement proceedings while parties clash over, and judges grapple with, the thought processes of each investigator." United States v. Morgan Guaranty Trust Co., quoted by Mr. Justice Blackmun in United States v. LaSalle National Bank, 437 U.S. at 316, 98 S. Ct. 2357, 2367. In this case the record discloses close cooperation between counsel for DiVivo, on the one hand, and counsel for DiBiasi and certain of the other partners and associates of DiVivo, on the other hand. There is every reason to believe that if there were no basis for the civil tax investigations of DiBiasi and the others, counsel for DiVivo as well as counsel for DiBiasi would know the same and that DiVivo would have presented specifics as to the same in one or more documents pursuant to Federal Civil Rule 56 and/or have informed the District Court of the same during DiVivo's counsel's presentation of DiVivo's "theory" of this case. There is thus no need, in this case, to remand for further presentation and consideration of further evidence to and by the District Court in order to afford the opportunity to DiVivo to prove abuse of the process of the District Court by the enforcement of the summons in the civil tax investigation of DiBiasi. DiVivo has had that opportunity and has fallen short of alleging or proffering facts or theory entitling him to any further evidentiary hearing or to any of the relief he seeks.

The judgment below is accordingly affirmed.

I agree with the majority that DiVivo has standing as an intervenor to raise the question of the good faith of the Internal Revenue Service in issuing the summons for records relating to his business dealings with DiBiasi. I disagree, however, that DiVivo has failed to allege facts sufficient to defeat enforcement of the summons. Relying on the standards enunciated by the Supreme Court in United States v. Powell, 379 U.S. 48, 85 S. Ct. 248, 13 L. Ed. 2d 112 (1964), I would hold that, when the IRS undertakes investigation of a taxpayer for the primary purpose of pressuring him to give evidence against another taxpayer, the investigation is not conducted in good faith and a summons issued in the course of the investigation is therefore not enforceable. In the instant case, DiVivo has alleged that "one of (the) purposes, if not the primary purpose (of the IRS investigation of DiBiasi is) to pressure DiBiasi into cooperating with the Internal Revenue Service in its investigation of (DiVivo)." Moreover, he has proffered evidence which tends to support his allegation. I therefore believe that the district court erred in denying DiVivo the opportunity to prove his allegation. I respectfully dissent.

Powell established that a district court should not enforce a summons issued in the course of an investigation that is not undertaken in good faith. In his opinion for the Court, Justice Harlan stated:

It is the court's process which is invoked to enforce the administrative summons and a court may not permit its process to be abused. Such an abuse would take place if the summons had been issued for an improper purpose, such as to harass the taxpayer or to put pressure on him to settle a collateral dispute, or for any other purpose reflecting on the good faith of the particular investigation. The burden of showing an abuse of the court's process is on the taxpayer . . ..

Id. at 58, 85 S. Ct. at 255. Although the claim of harassment advanced by the taxpayer in Powell involved repetitive summonses, the broad scope of the quoted language makes clear that other forms of harassment or bad faith will also render a summons unenforceable. The broad applicability of the Powell standards was reaffirmed in United States v. LaSalle National Bank, 437 U.S. 298, 98 S. Ct. 2357, 57 L. Ed. 2d 221 (1978). In particular, LaSalle made clear that the Powell standards are independent of, and in addition to, the requirement that a summons must be issued before the IRS has abandoned the pursuit of civil tax determination or collection in favor of criminal prosecution. See id. at 317 n. 19, 318, 98 S. Ct. 2357.

DiVivo has alleged that the IRS undertook its investigation of DiBiasi and issued the summons in question for the purpose, if not the primary purpose, of pressuring DiBiasi into cooperating with the investigation of DiVivo by giving evidence against him. If it is proved that the primary purpose of the investigation and the summons was to force DiBiasi's cooperation in the DiVivo investigation, then I think Powell requires that enforcement of the summons be denied. It is difficult to conceive of an example of bad faith that would better qualify as "an improper purpose, such as to harass the taxpayer or to put pressure on him to settle a collateral dispute."

The majority seeks to justify the purpose attributed by DiVivo to the IRS by citing the authority granted to the IRS under I.R.C. § 7122(a) to compromise any civil or criminal tax case, prior to referral to the Department of Justice. In United States v. Barrett, 505 F.2d 1091, 1100-03 (7 Cir. 1974), Cert. denied, 421 U.S. 964, 95 S. Ct. 1951, 44 L. Ed. 2d 450 (1975), § 7122(a) was relied upon to permit the grant of civil tax immunity to the accomplice of a bribery defendant, with respect to the income tax owed by the accomplice on bribes which passed through his hands, in exchange for the accomplice's testimony against the defendant. But the power of the IRS to compromise tax cases has no bearing on the question before us. DiVivo does not deny that if the IRS had undertaken an investigation of DiBiasi in good faith for the primary purpose of determining and collecting DiBiasi's tax liability, then the IRS could properly issue summonses pursuant to that investigation and could ultimately compromise DiBiasi's case in exchange for his testimony against DiVivo. Rather, DiVivo alleges that the investigation of DiBiasi was undertaken in bad faith as a pressure tactic to force DiBiasi to cooperate in the investigation of DiVivo. Nothing in § 7122(a) or Barrett authorizes the IRS to undertake or pursue an investigation for such a primary purpose.

I fully recognize the difficulty that DiVivo would have in proving his case. Powell places the burden of proving bad faith on the party opposing enforcement, 379 U.S. at 58, 85 S. Ct. 248, and this burden is a heavy one indeed. In order to prevent enforcement of the summons, DiVivo would have to prove that the primary purpose of the investigation of DiBiasi was not to determine and collect his tax liability but rather to pressure him to give evidence against DiVivo. Although such proof would be quite difficult to establish, DiVivo proffered evidence to the district court, Inter alia, that DiBiasi was contacted about cooperating with the DiVivo investigation very soon after receiving notification of his own investigation; that DiBiasi was told to contact the Special Agent in charge of the DiVivo investigation, rather than the agents handling his own investigation; and that the DiBiasi investigation has been characterized by several other unexplained departures from standard IRS procedures. While such evidence may be insufficient to prove the ultimate fact sought to be established, it was sufficient to raise a genuine dispute on the question of good faith of the IRS, and the district court therefore erred in denying DiVivo "the adversary hearing to which (he) is entitled before enforcement (of the summons) is ordered," Id.

Although I share the concern expressed by the majority that consideration by district courts of objections charging IRS bad faith may unduly delay the enforcement of IRS summonses, I doubt that such objections will be frequent. The difficulty of proving IRS bad faith, which I discuss above, will be a deterrent to many unfounded objections. Summary procedures, where appropriate, can assist in the expeditious disposition of such objections. See id. at 58 n. 18, 85 S. Ct. 248 (Federal Rules of Civil Procedure govern proceedings to enforce IRS summonses). In any event, both Congress and the Supreme Court have determined that full consideration of objections to the validity of a summons is worth the delay that may result. Congress has provided for a judicial hearing prior to the enforcement of a summons and for the right of a person in DiVivo's position to intervene in such a proceeding. See I.R.C. §§ 7604(b), 7609(b)(1). And, as the majority notes, the Supreme Court has indicated that occasional delays caused by the consideration of unmeritorious objections to IRS summonses is the necessary price for ensuring that the process of the courts is not abused. See United States v. LaSalle National Bank, 437 U.S. at 316 n. 17, 98 S. Ct. 2357; United States v. Powell, 379 U.S. at 58, 85 S. Ct. 248.

I would reverse the judgment of the district court and remand the case for a full hearing on DiVivo's allegations of IRS bad faith.