The Mechanics of Conducting an Internal Investigation (Installment 4)

As part of my LinkedIn Article in internal investigations, I’ve addressed threshold considerations including two specialty threshold issues. I have also addressed the mechanics of conducting the investigation. In this post, I turn to the mechanics of conducting the investigation. In this post, I continue the focus on these issues.

 Compelling witness participation

Employees of public or private entities are usually required to cooperate with internal investigations as a responsibility of employment. Review of the entity’s policies and procedures regarding what employees are required to do, as terms of their employment, is a useful first step. Those unwilling to be interviewed may be subject to some form of progressive discipline or job action.[1] The specter of such actions is usually sufficient to secure participation.

Former employees present a different issue. Unless there are contractual requirements that survive the employee’s separation from the entity, participation in an internal investigation by a departed employee is entirely voluntary. Participation can often be secured when the witness is informed that some manner of formal process may issue from the government or a potential party to litigation. Often the witness wants to know what those processes will entail and what she/he may be asked to do. When providing this information, it remains important that the entity’s counsel not provide legal advice, as prohibited by the Model Rule of Professional Responsibility 4.3, and that counsel clearly define its role as counsel to the entity. Counsel also must assess whether Upjohn warnings apply. Additionally, it is prudent to recognize that former employees do not have the same job-related motivations as current employees, and may not heed counsel’s request not to discuss the content of the interview.

Witness’ access to counsel during the interview

Internal investigations involving private entities ordinarily do not implicate a witness’ right to have counsel participate in the interview. Nevertheless, there may be special circumstances—including interviews of victims or whistleblowers—where the client may permit such participation. These are fact-specific determinations made to enhance the efficacy of the investigation. It may be that a witness simply will not cooperate at the level necessary without her/his counsel in the room. The net benefit of getting better cooperation and candor may outweigh the anticipated downsides of participation by the witness’ counsel.

When permitting counsel to participate, it is often helpful to set ground rules. Among other things, counsel is there to observe and not participate in the questions and answers. It is not a deposition, there is no right to object and the counsel cannot behave is a way that disrupts the investigation. Further, the counsel needs to agree to maintain the process as confidential.

Work papers and drafts of the report of investigation

All work papers and drafts of the report should be labeled as “Confidential Attorney-Client Communications and Attorney Work Product,” and also as drafts. The materials should be treated and maintained as confidential and should be shared only on a “need to know basis.” Disclosure should be limited to members of the investigative team or certain select decision makers of the client. Counsel also should be mindful that disclosure of drafts to third parties may waive privilege protections. By maintaining strict formalities, the chances of sustaining the privileges and protections through challenges are increased. Conversely, lack of diligence on these issues puts the protections at risk of waiver, which, as discussed above, can vary in scope.

Circulation and control of the final report of investigation to maintain privilege

If the client wants to maintain privilege of the final report of investigation, strict precautions must be used to limit circulation. Counsel should consider issuing individually numbered reports to specifically identified decision makers at the client. Express written warnings should accompany the circulation of the report and should detail the consequences of circulating the report beyond the defined audience. Presenting the report through a secure read-only platform that limits the reader’s ability to copy or forward the report may be useful to control circulation to only the intended audience.

[1]      There often are differences in what actions private entities can take over employees versus public entities. These differences may drive the strategy and tactics employed to secure participation.