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By: Scott A. Coffina
One thing leaders of organizations routinely recognize is that “you never know what tomorrow will bring.” Another common slogan is “life happens.” If “life” happens to bring the organization a situation that could expose the organization, its employees, customers, leaders or other constituencies to physical, legal, financial or reputational peril, a logical first step is to conduct an internal investigation to identify the extent, cause, and scope of the problem, and to receive informed legal advice about how to address it.
The information developed through internal investigations may be protected from disclosure to third parties by the attorney-client privilege and work product doctrines. This article presents an “FAQ” about how those privileges may apply to internal investigations, and steps that should be taken to preserve those protections.
Bearing in mind that attorney-client privilege protects confidential communications with counsel aimed at receiving legal advice, and the work product doctrine protects the analysis and mental impressions of counsel, the best way to ensure that information developed in an internal investigation will be protected from unwanted disclosure is to have an attorney direct the investigation.
Note that one of the hallmarks of a privileged attorney-client communication is that the communication be for the purpose of seeking legal advice from an attorney. To the extent outside counsel is retained to lead or conduct the internal investigation, the engagement letter should expressly note that counsel is being retained not merely to conduct a factfinding investigation, but also to provide legal advice related to the client related to the matter.
Of course, every situation is different, and the organization should consider at the outset whether circumstances will require the release of a report of investigation due to regulatory requirements, cooperation with the government, or intense public interest in the matter being investigated. This may affect how witness interviews, communications, and documentation of information obtained during the investigation will be structured.
Generally, no. The work of in-house counsel is entitled to the same attorney-client privilege and work product protection that would apply if outside counsel conducted the investigation. In certain circumstances, and depending upon the typical responsibilities of the in-house attorney conducting the investigation, there may be practical reasons to have outside counsel lead an investigation to present a clear distinction to employee witnesses between the investigation team and counsel they routinely consult for legal advice.
No. Interviews and document review can be conducted by investigators or, for example, forensic accountants, without sacrificing the protections of the attorney-client privilege, so long as the actions of these non-attorneys are being directed by counsel. It is important, however, that investigators provide employees with the applicable elements of the Upjohn Warnings (see below), to avoid misunderstandings about the role of the investigator(s) and the degree to which privilege may or may not protect the content of that interview.
The key to maintaining the privilege over an interview with an organization’s employee during an internal investigation is to clarify counsel’s role (or the investigator’s role, acting at counsel’s direction) and scope of representation, the so-called “Upjohn Warnings,” based upon the Supreme Court’s decision in Upjohn v. United States.
The Upjohn Warnings, which should be given at the outset of the interview, inform the employee that, as an employee of the organization, the attorney-client privilege protects the conversation, but counsel represents the organization, not the employee individually, and so the privilege belongs to the organization. The attorney should stress that they do not have an attorney-client relationship with the employee.
It also should be made clear to the employee that the company may decide to waive the privilege and disclose what is said in the interview to a third party, including the government. That right belongs to the organization, not the employee, so the employee should be directed not to discuss what is said in the interview with anyone else, in order to preserve the attorney-client privilege, and for practical reasons as well.
The Upjohn Warnings and the employee’s acknowledgement that they understand them can be communicated orally, but they should be memorialized in writing.
Finally, when conducting interviews intended to be protected by the attorney-client privilege, only the witness, counsel, and/or investigators acting at the direction of counsel should be in the room (or, in contemporary practice, on the video conference). No one from outside the organization should be present.
There is an argument that the privilege recognized in Upjohn that protects confidential communications between the organization’s counsel and its employees extends to former employees as well, particularly if the subject of the interview relates to the time when the individual was still employed. However, courts have not been consistent in protecting communications with former employees, and the safer course is to approach interviews with former employees as non-privileged. That said, counsel can still advise the witness that the matter is confidential and ask them to treat it as such. In addition, the interview memorandum generated to document the interview with the former employee still should be protected from disclosure by the work product doctrine, assuming the other requirements for work product protection are met.
It is important to memorialize witness interviews conducted during an investigation, to establish the record on which conclusions are drawn and decisions are based. The most reliable way to preserve privilege is by counsel documenting an interview in a memorandum, reflecting what should be described as the attorney’s “recollection and mental impressions of what was discussed during the interview.” Such language invokes the essence of attorney work product protection: protecting the attorney’s mental impressions, conclusions, opinions, or legal theories developed in anticipation of litigation. Of course, the underlying communications between employee and the interviewer are, as noted, also protected by the organization’s attorney-client privilege.
The question sometimes arises whether a recorded interview or a signed witness statement is afforded work product protection to the same degree as a memo from counsel. The general consensus is that these methods of documenting information during an investigation would receive the same protection, under the theory that, despite there being a verbatim account of the witness’ statement, the interview was conducted in anticipation of litigation (assuming litigation has been threatened or reasonably can be anticipated), and the topics covered and questions asked reflect counsel’s assessment of what is relevant and important for strategizing and advising the client. However, an interview memorandum by counsel, rather than a verbatim “transcript,” likely wards off any later challenge that the statement is discoverable.
This next suggestion may seem like a formality, but it has substantive importance for expressing counsel’s and the organization’s intent to maintain confidentiality and thus preserve privilege – all work product, i.e., summaries, memoranda, correspondence, etc., created in the investigation should be labeled “Privileged and Confidential, Attorney Work Product, Attorney-Client Communication.”
This subject underscores the importance of giving thoughtful consideration at the outset to what the end product from the investigation will be. If the matter under investigation is high profile and requires a public accounting of what occurred, or if the organization is considering cooperating with a government investigation that may involve turning over the findings of the internal review, the organization can anticipate disclosing a report of some kind.
Anticipating the need for a post-investigation disclosure, the organization can take steps to minimize the risk of a broad privilege waiver by planning and preparing a non-privileged report. Such a report would set forth the facts that the investigative team distilled from the evidence they reviewed, but does not disclose the underlying communications with witnesses (i.e., confidential attorney-client communications) on which those facts rest. To illustrate, the report might find, “based upon the weight of the evidence” that “the light was red,” without specifically attributing the observation to each of the five employee witnesses who told the investigative team in confidence that, “the light was red.”
This approach does not guarantee that a broader waiver won’t be found, but the organization’s taking steps to preserve its privilege substantially strengthens the argument in a later challenge that the attorney-client communications – and attorney work product – underlying the disclosed matter should remain confidential.