Presenting a live 90-minute webinar with interactive Q&A Attorney-Client Privilege at Risk in Investigations and Audits Preserving Confidential Information, Safeguarding Work Product, Avoiding Inadvertent Disclosure WEDNESDAY, SEPTEMBER 14, 2016 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Stuart M. Altman, Director of Corporate Legal Investigations, Intel , Santa Clara, Calif. David M. Greenwald, Partner, Jenner & Block , Chicago The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
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M AXIMIZING P ROTECTIONS O F A TTORNEY -C LIENT P RIVILEGE AND W ORK P RODUCT D OCTRINE IN I NTERNAL I NVESTIGATIONS AND A UDITS W EDNESDAY , S EPTEMBER 14, 2016 S TRAFFORD P UBLICATIONS Stuart M. Altman David M. Greenwald Director, Corporate Partner Legal Investigations Jenner & Block LLP Intel Corporation Chicago, Illinois stuart.m.altman@intel.com dgreenwald@jenner.com
T OPICS • Attorney-Client Privilege – Focus on corporate context • Work Product Doctrine • Waiver – Generally – Disclosures to Government – Disclosures to Auditors 6
S CENARIO • Anonymous Call Received By Company Helpline • Helpline Sends Report of Call to Chief Compliance Officer • CCO Notifies General Counsel • General Allegations: – European-Based Employee of U.S. Publicly Traded Company Has Been Paying Off Government Officials in Middle East to Obtain Contracts. – Employee’s Manager in U.S. Is Aware of Payments. – Company Has Been Booking Costs of Payoffs as “Commissions . ” 7
I SSUES T O C ONSIDER W HEN C OMPANY R ECEIVES C OMPLAINT • Should there be an investigation? • If so, should the company handle it internally or with outside counsel? • Who should be notified within the company? • Who should authorize the investigation? • Outside counsel: Engagement Letter – Who engages counsel? – What is the stated purpose of engagement? • Data Lock Down – Where is the data likely to reside? – Are there custodians whose data should be captured immediately ( e.g ., through forensic imaging of laptops, pdas, voicemail, email, etc.)? – If data resides outside of U.S.: What limits apply regarding: (a) processing data; (b) transferring data; (c) limiting use for which data will be used? – Litigation Hold Notice? To whom? – Has document preservation duty been triggered? 8
I SSUES T O C ONSIDER W HEN C OMPANY R ECEIVES C OMPLAINT • Determine Initial Scope of Investigation. • Engage Third Parties? – Forensics: Gathering and preserving data? – Analytics: Is there need for accounting or other technical analysis? – Public Relations? – Crisis Management? – Data Review Vendors? 9
G OALS Establish Team and Process to: • Preserve and review relevant data. • Determine if there has been any wrongdoing. • Conduct the investigation in manner that maximizes Attorney-Client Privilege and Work Product Protection. – Attorney-Client Privilege and Work Product Doctrine should be considered separately. • Preserve Company’s ability to cooperate with government authorities. • Determine corrective action, including whether or not to voluntarily disclose. • Corrective action may include optimizing internal standards and procedures. – Compliance Program – Training • Action may include employee discipline up to and including termination. 10
W HAT L AW A PPLIES IN U.S. F EDERAL C OURT • Attorney-Client Privilege – Choice of Law Governed by FRE 501 – State law in diversity cases (choice of law issues may be complex) – Federal law in federal question cases, including pending state claims – Note: FRE 502 governs both federal and state court proceedings. • Work Product Doctrine – Governed by FRCP 26(b)(3) and Federal Common Law – Rule 26 analogues govern in State Court • “Touch Base” Approach and Comity Considerations for communications occurring outside the U.S. 11
A PPLYING P RIVILEGE I N U.S. C OURTS T O N ON -U.S. C OMMUNICATIONS “Touch Base” Approach • First, determine whether communication involves U.S. or foreign law. • Foreign law governs communications relating solely to matters involving foreign jurisdictions. • U.S. law applies where a communication “touches” the U.S. • When applying U.S. law, the frequent issue is whether a person acting in a legal capacity will be treated as a lawyer for attorney-client privilege. – Lawyer generally defined as “member of the bar of a court. ” – Issue often arises whether foreign in-house lawyer or legally trained person ( e.g. , patent agent) qualifies. – Legally trained corporate personnel who are not members of the bar generally not deemed to be attorney for purposes of privilege. 12
A TTORNEY -C LIENT P RIVILEGE : E LEMENTS • Client – Who is the client in a corporate setting? • Lawyer – Acting as a lawyer, not as a business person. • Communication – Facts alone are not privileged. • Legal Purpose – Business advice is not privileged • Confidentiality – Intended and maintained. 13
A RE I NTERNAL I NVESTIGATIONS L EGAL I N N ATURE ? In re Kellogg Brown & Root, Inc. , 756 F.3d 754 (D.C. Cir. 2014) • Qui Tam Relator sought discovery of KBR’s internal investigation materials. • District Court held that investigation materials were not privileged, and instead were business in nature because the investigation had been conducted pursuant to DoD regulations and corporate compliance policy. – District Court applied “but for” test to determine if “primary purpose” of investigation was legal. – District Court found that KBR did not prove that communications would not have been made “but for” the fact that legal advice was sought. 14
A RE I NTERNAL I NVESTIGATIONS L EGAL I N N ATURE ? In re Kellogg Brown & Root, Inc. , 756 F.3d 754 (D.C. Cir. 2014) • Appellate Court granted Petition for Writ of Mandamus, holding that the court had committed clear error. – District Court’s ruling could not be reconciled with Upjohn , which involved a corporate internal investigation. – Appellate Court applied broad approach to “primary purpose” test: “Was obtaining or providing legal advice a primary purpose of the communication, meaning one of the significant purposes of the communication?” See In re Gen. Motors LLC Ignition Switch Litig. , 80 F.Supp. 3d 521, 530 (S.D.N.Y 2015) (adopting KBR standard). Note: Other courts may not apply as expansive an approach to “primary purpose” test, particularly where the investigation at issue can be described as “run -of-the- mill” and “ordinary business activity. ” 15
W HO H AS T HE P RIVILEGE ? 1. Privilege within the Corporation: Who is the client? 2. Who is the lawyer? 3. Privilege Considerations During Employee Interviews (Communications) 4. Third Parties in Investigations (Confidentiality) 5. The Garner Doctrine 16
W HO E NGAGED T HE L AWYER ? • Corporation through General Counsel? • Board of Directors? • Audit Committee? • Special Committee in response to derivative demand? • Parent? Subsidiary? Affiliates? • Joint Venture? • Joint Venturer? • Multiple Entities? Practice Point: It is critically important to know to what entity or persons the attorney owes duties. 17
W HO I S T HE C ORPORATE “C LIENT ” F OR T HE P URPOSES O F T HE A TTORNEY -C LIENT P RIVILEGE ? • Upjohn Approach – Federal Question Cases • “Subject Matter” Approach – Most States 18
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