 |
Lawyers Fear a DOJ 'Culture of Waiver'
March 24, 2006
The National Law Journal
By Marcia Coyle
A survey of in-house and outside counsel by a coalition of business and legal organizations reports that a "culture of waiver" of the attorney-client privilege now exists in corporate investigations by the U.S. Department of Justice and other federal agencies.
The survey, conducted in response to a request for data on the issue by the U.S. Sentencing Commission and others, drew responses from 1,400 in-house and outside counsel and was designed to capture more information about government and auditor requests and implicit expectations for privilege and work-product waivers, according to Stephanie Martz of the National Association of Criminal Defense Lawyers, a member of the Coalition to Preserve the Attorney-Client Privilege.
"We asked the questions every possible way we could think to capture as much data as we could," said Martz, director of NACDL's white-collar crime project. "We asked whether a privilege waiver was requested directly and unambiguously or indirectly, or whether it was inferred from [government officials'] statements; whether counsel thought requests had increased; whether it was made a condition of cooperation, and which [government] offices were doing it."
THE NUMBERS SPEAK
The survey results, which were submitted on March 7 to the House Judiciary Committee's subcommittee on crime, terrorism and homeland security, included the following:
Nearly 75 percent of both inside and outside counsel agree that a "culture of waiver" has evolved in which government agencies expect a company under investigation to waive legal privileges (1 percent of in-house counsel and 2.5 percent of outside counsel disagreed with the statement).
Of the respondents who confirmed that they or their clients had been subject to investigation in the past five years, approximately 30 percent of in-house counsel and 51 percent of outside counsel said that the government expected waiver in order to engage in bargaining or be eligible for more lenient treatment.
Of those who had been investigated, 55 percent of outside counsel said the privilege waiver was requested either directly or indirectly; 27 percent of in-house counsel confirmed that experience.
Eight percent of outside counsel and 3 percent of in-house counsel said they "inferred it was expected."
At the subcommittee hearing, Associate Attorney General Robert McCallum denied claims by business and legal groups that waiver of the privilege is the norm in Justice Department investigations. "We do not believe [waivers] are routinely requested," he said, adding that there are "many instances" where the department has gotten information without privilege waivers. "Waiver is but one factor in determining cooperation," he said.
THE 'CULTURE OF WAIVER' IN NUMBERS
The types of protected materials most requested by the government in work-product waiver requests:
IN-HOUSE COUNSEL:
Results of written internal investigation reports: 29%
Interview memos with witnesses: 22%
Results of reports prepared by nonlawyers or contractors hired to investigate a corporate matter: 14%
OUTSIDE COUNSEL:
Interview memos with witnesses: 30%
Results of written internal investigation reports: 25%
Results of reports prepared by nonlawyers or contractors hired to investigate a corporate matter: 16%
Source: Coalition to Preserve the Attorney-Client Privilege.
|
Presenting the opposite view were former Attorney General Richard Thornburgh of the Pittsburgh office of Kirkpatrick & Lockhart Nicholson Graham; Thomas J. Donohue, president of the U.S. Chamber of Commerce; and William M. Sullivan Jr. of Chicago-based Winston & Strawn.
Thornburgh said his firm's partners report that waiver requests are standard practice.
"The trend is to demand waiver as a precondition for favorable treatment for cooperation," said Thornburgh. "This is not an issue that Washington lobbyists have orchestrated."
The survey results are inconsistent with a survey conducted in 2002 by then-U.S. Attorney Mary Beth Buchanan from the Pittsburgh U.S. Attorney's Office. She reported in a law review article:
"The survey results indicate that requests for waivers simply are not the norm," she wrote. "In contrast, those who argue that waivers are required frequently do so on the basis of anecdotes without any supporting data."
WAIVERS NOT THE NORM?
The Justice Department maintains today that waivers are not the norm.
But the Buchanan survey was conducted several years ago and its questions were asked in a very narrow way, said Susan Hackett, senior vice president and general counsel of the Association of Corporate Counsel, also a member of the Coalition to Preserve the Attorney-Client Privilege.
Hackett said that the coalition's more recent and detailed survey supports its contentions that the privilege and the work-product doctrine as applied in the corporate context are under attack.
The NACDL's Martz agreed, saying, "I think the only way DOJ can get its arms around the problem is to accept our survey as accurate or do their own that is every bit as detailed as ours of U.S. attorneys. DOJ should ask: How often have you received information pursuant to a waiver -- and work back from there.
"There's really no thing such as a voluntary waiver at this point," Martz insisted.
|