Waiving Privilege a Crucial Sentencing Issue


	Print or Email This Page Waiving Privilege a Crucial Sentencing Issue An Unlikely Coalition Urges That Waivers Not Be a Factor in Sentencing Aug. 29, 2005 National Law Journal By Marcia Coyle Washington—An unusual coalition of business and civil rights groups and a number of former U.S. attorneys general strongly urged the U.S. Sentencing Commission recently to make clear that waiver of attorney-client privilege and work-product protections should not be a factor in determining whether an "organization" gets a sentence reduction for cooperating with the government. Those groups, as well as the American Bar Association and U.S. Representative Dan Lungren, a former California attorney general, sent letters to the commission in response to the agency's call for comment on whether the waiver issue should be on its priority list as it heads into its next cycle of sentencing amendments. "This is probably one of the most important issues, post-Enron, facing the white-collar criminal defense bar because of the way it affects both corporate decision-making and the way businesses are run," said Stephanie Martz, director of the white-collar crime project of the National Association of Criminal Defense Lawyers (NACDL). "It makes it difficult for companies to conduct meaningful compliance programs when they are in constant fear that everything is going to be turned over to the government," Martz said "It also makes it very difficult for employees to feel secure in their communications with lawyers." In April 2004, the commission sent Congress a number of amendments to Chapter 8 of the guidelines relating to "organizations," a term that includes corporations, partnerships, unions, nonprofit groups, governments and other entities. The commission also included a change to the Commentary to Section 8C2.5, which encourages the government to require organizations to waive their protections to demonstrate cooperation with the government, and thus to qualify for a more lenient sentence. Those amendments became effective in November 2004. "Now that the privilege waiver amendment has been incorporated into the official Commentary to the Sentencing Guidelines, the Justice Department, as well as other enforcement agencies, are contending that this amendment provides Congressional ratification of the Department's policy of routinely asking that privilege be waived," wrote the former U.S. attorneys general. "In practice, companies are finding that they have no choice but to waive these privileges whenever the government demands it. "Even if the charge is unfounded, the charge of 'noncooperation' can have such a profound effect on a company's public image, stock price and creditworthiness that companies generally yield to waiver demands," said former Attorney General Griffin Bell, who was joined by former attorneys general Edwin Meese III, Richard Thornburgh and Stuart M. Gerson; former solicitors general Kenneth W. Starr, Seth Waxman and Theodore B. Olson; and former deputy attorneys general Carol E. Dinkins and George J. Terwilliger III. All of the groups and Lungren contend that the waiver amendment discourages personnel within organizations from consulting with their lawyers and that, in turn, impedes the lawyers' ability to counsel compliance with the law. They also assert that it makes detection of corporate misconduct more difficult by undermining internal compliance programs. And, they say, it unfairly harms employees who can cooperate and risk that their statements made to their organization's lawyers will be turned over to the government, or who can decline to cooperate and take the chance of being fired. Even though a recent U.S. Supreme Court decision made the guidelines advisory instead of mandatory, the waiver amendment continues to create problems, according to the NACDL and its coalition, which includes the American Chemistry Council, the American Civil Liberties Union, the Association of Corporate Counsel, the U.S. Chamber of Commerce and others. The commission sends its proposed amendments to Congress by May 1, 2006.
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