Page 38 - American College of Trial Lawyers Federal Criminal Procedure Committee 2020 Update: Recommended Practices for Companies and Their Counsel in Conducting Internal Investigations

confidential. The agreement should also specify the protocol for withdrawal, require notice if one of
the parties is compelled to disclose protected information, and outline the rights of the participants if
one party agrees to cooperate with the government.

Joint defense communications should be limited to conversations among counsel, not among
their clients, non-lawyers, or their agents.

The Independent Committee should advise Investigatory Counsel at the outset of the
engagement not to share information with the company’s independent auditors without the fully
informed consent of the Independent Committee. With regard to investigation-related disclosures to
a company’s independent auditors, the reality is that, in most cases, especially when the issues are
accounting related, the auditor will insist that presentation of privileged material is a sine qua non
for the certification of financial statements. Under those circumstances, the company may have no
choice but to authorize the communication or delivery of such materials. In the event that disclosure
is indeed required, Investigatory Counsel should determine that any materials provided to the
auditor are indeed work product and review the applicable case law in the relevant jurisdiction(s) to
determine the governing law and ensure the specific circumstances of the audit and the nature of the
materials provided do not render the auditor an “adversary” and destroy the privilege.

Investigatory Counsel should also discuss and memorialize the independent auditor’s
confidentiality obligations to the company, if the company’s existing agreement with the auditor does
not contain adequate confidentiality provisions. Investigatory Counsel should also ensure that only
those materials necessary to the auditor’s examination are provided in order to minimize the scope of
waiver if one is later found.

During the course of the investigation, Investigatory Counsel should keep and continuously
update a record of witnesses and documents examined, documents shown to witnesses, and issues raised.

Investigatory Counsel should regularly update the Independent Committee on the course of
the investigation. In the early stages of an inquiry, updates should generally be made orally, because
of the possibility that preliminary information gathered or early conclusions formed might prove to be
inaccurate or incomplete, and prejudicial to the company as well as employees implicated by them.

Upon the completion of the investigation, Investigatory Counsel should report its findings
and the conclusions, and the bases therefor, to the Independent Committee and, as appropriate, to the
Board of Directors. Investigatory Counsel should be careful to remind the Independent Committee
that the report’s conclusions are ultimately that of the Independent Committee, not just Investigatory
Counsel. Investigatory counsel should also remind the Independent Committee and other Board
members, as the case may be, that they have fiduciary responsibilities to draw their own conclusions
as to the evidence presented.

Before presentation of the final report, the Independent Committee and Investigatory Counsel
should again give careful consideration to whether the ultimate form of the report will be oral
(supported when appropriate by PowerPoint) or written.

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