Snepp v. United States
444 U.S. 507 (1980)
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Rule of Law:
When a former government agent breaches the fiduciary duty created by a prepublication review agreement, a constructive trust on all profits earned from the unreviewed publication is an appropriate remedy, regardless of whether the publication contains classified information.
Facts:
- In 1968, as a condition of employment, Frank W. Snepp III signed an agreement with the Central Intelligence Agency (CIA).
- The agreement stated he was entering a 'position of trust' and promised he would not publish any information relating to the Agency without 'specific prior approval.'
- During his employment, Snepp was assigned to positions of trust and granted frequent access to classified information, including intelligence sources and methods.
- After leaving the CIA in 1976, Snepp published a book titled 'Decent Interval' about certain CIA activities in South Vietnam.
- Snepp published the book without submitting the manuscript to the CIA for the contractually required prepublication review.
- For the purposes of this litigation, the United States government conceded that Snepp’s book did not contain any classified information.
Procedural Posture:
- The United States sued Frank W. Snepp III in the U.S. District Court for the Eastern District of Virginia to enforce the secrecy agreement.
- The District Court (trial court) found that Snepp had breached his contract and position of trust, which caused irreparable harm to the United States.
- The District Court enjoined future breaches by Snepp and imposed a constructive trust on all profits he earned from the book.
- Snepp, as appellant, appealed to the U.S. Court of Appeals for the Fourth Circuit.
- The Court of Appeals affirmed the finding that Snepp breached a valid contract and upheld the injunction against future violations.
- However, the Court of Appeals reversed the District Court's imposition of a constructive trust, concluding it was not supported by the record and limiting the government's remedy to nominal damages and potentially punitive damages.
- Both Snepp and the United States petitioned the U.S. Supreme Court for a writ of certiorari.
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Issue:
Does a former Central Intelligence Agency (CIA) agent's breach of his contractual and fiduciary duty to submit any writing about the agency for prepublication review entitle the government to a constructive trust on all his profits from the resulting publication, even if the government concedes the book contains no classified information?
Opinions:
Majority - Per Curiam
Yes. A constructive trust is the appropriate remedy for a former agent's breach of the fiduciary duty inherent in a prepublication review agreement. Snepp's employment with the CIA created a fiduciary relationship and a high degree of trust, which he acknowledged in writing. His promise not to publish any information without clearance was an integral part of that trust. By deliberately violating this obligation, Snepp breached his fiduciary duty, not merely a contractual term. This breach inflicted irreparable harm on vital national interests by undermining the CIA's appearance of confidentiality, which is essential for recruiting intelligence sources and maintaining relationships with foreign intelligence services. The actual damage is unquantifiable, and other remedies like nominal or punitive damages are inadequate and impractical, as proving them might require the government to disclose the very secrets the agreement was designed to protect. A constructive trust is the 'natural and customary consequence of a breach of trust' and simply requires the agent to disgorge the profits gained from his faithlessness.
Dissenting - Justice Stevens
No. The remedy of a constructive trust is not authorized by statute, the contract, or the common law in this situation. Snepp breached a contractual duty to obtain prepublication clearance, but since the government conceded the book contains no classified material, he did not breach his core fiduciary duty to protect confidential information. The interest the contract was designed to protect was not compromised. The profits from the book were the result of Snepp's legitimate activities as an author, not from the misuse of confidential information. Had he submitted the manuscript, the CIA would have been obligated to approve it, as it contained no classified information. Therefore, Snepp was not unjustly enriched by his breach. Imposing a constructive trust is an unprecedented and harsh remedy that functions as a prior restraint on speech, and the preferable remedy for any generalized harm would be punitive damages.
Analysis:
This decision significantly strengthens the government's ability to enforce secrecy and prepublication review agreements with its intelligence employees. It establishes that the act of circumventing the review process is itself a breach of fiduciary duty causing irreparable harm, regardless of the content of the publication. By authorizing a constructive trust, the Court provides the government a powerful and easily administered remedy that avoids the need to prove quantifiable damages or risk disclosing sensitive information in court, thereby creating a strong deterrent against future breaches by other agents.
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