Compliance Investigations: Privilege & Process

I.

M. Daria Niewenhous1

Beth S. Rosenbaum

Member Mintz, Levin, Cohn, Ferris, Glovsky, and Popeo, PC One Financial Center Boston, MA 02111 [email protected] 617.348.4865

Vice President & Chief Counsel, Kindred Healthcare, Inc. 680 S. 4th Street Louisville, KY 40202 [email protected] 512.596.7232

INTRODUCTION Health care entities are frequently required to conduct internal investigations,

often with the advice of legal counsel. These investigations may be necessary for various reasons including, but not limited to: 

determining reporting obligations under state and federal law, including selfdisclosure obligations triggered by overpayments;



identifying and ending any improper/illegal practices, which may involve taking corrective actions and/or taking appropriate disciplinary action within the organization;



monitoring ongoing adherence to a corrective action plan, including a review of the efficacy of any corrective action plans that are currently in place;

1

The views expressed in these materials and in the seminar presentation are the personal views of the authors and do not represent the formal position of Kindred Healthcare or of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., any other individual attorneys at the firm, or any of its clients. The authors expressly reserve the right to advocate freely other positions on behalf of clients. The authors want to thank Jordan T. Cohen of Mintz Levin for his contributions to this paper.



minimizing administrative, civil and /or criminal exposure to the maximum extent possible; and



managing the myriad public relations and other communications issues that health care entities routinely face. The specter of qui tam complaints is significant, and growing, resulting in an

increasing need for health care entities to monitor and investigate their activities. Further, the situations warranting an investigation are increasing as a result of an ever-growing patchwork of state and federal laws and regulations. While the process of conducting an investigation is important, health care entities often fail to conduct these investigations in a manner that maximizes their ability to protect their communications under the attorney-client privilege. The protection of communications in an internal investigation is crucial to the investigation itself, for such protection provides the organization and its parties the best mechanism for open and candid communication. This paper and the accompanying presentation will first discuss the attorney-client privilege and its relationship to investigations and then discuss the processes that should be implemented when conducting an internal investigation. II.

BASICS OF THE ATTORNEY-CLIENT PRIVILEGE The attorney-client privilege protects from disclosure certain communications

between a client and their lawyer when the purpose of those communications is to seek or provide legal advice. In doing so, the privilege encourages full and frank communication between attorneys and their clients. The privilege is particularly important in heavily regulated industries, such as health care, and is integral to ensuring compliance with applicable laws and regulations while protecting legal advice from disclosure. However,

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not all communications related to internal investigations are protected under the attorneyclient privilege, even when an attorney is directly involved in the communication. Rather, certain requirements must be satisfied in order for the communication to be deemed protected by the attorney-client privilege. A.

Elements of the Privilege.

Generally speaking, the attorney-client privilege will protect communications made between persons in confidence for the purpose of seeking, obtaining or providing legal assistance, provided that the privilege has not been waived. This general rule yields the following questions, which are critical to assessing whether the attorney-client privilege will apply: 1.

Is there a communication?

A communication need not be written; oral communications may also be protected under the attorney-client privilege. Additionally, written communications may be in either hard copy or electronic form. Determining whether there is a communication is important, for the protection afforded by the attorney-client privilege is not absolute, it applies only to communications, not to facts. 2.

Is the communication made in confidence?

The attorney-client privilege will only apply in situations where the party holding the privilege intends that the communication will remain confidential and reasonably believes that the information will not be shared with a third party. 3.

Is the communication made to or by an attorney?

For the attorney-client privilege to apply, the communication at issue must be made between a client and a duly licensed attorney or an agent of the attorney working

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under the attorney’s supervision and control. These agents may include an attorney’s assistant or paralegal, and, in some circumstances, an attorney’s expert or consultant. 4.

Does the purpose of the communication “relate to the client’s reasons for seeking representation?”

The attorney-client privilege does not apply to all topics of communication. For the attorney-client privilege to apply, it must relate to a legal issue rather than a business or other issue. Consequently, mere participation of an attorney in a communication will not necessarily be sufficient to invoke the privilege. Further, even if the communication does relate to a legal issue, the privilege will not apply to protect communications made in furtherance of a crime or fraud (the "crime-fraud" exception). 5.

Has the privilege been waived?

Communications that would otherwise be afforded protection under the attorneyclient privilege may nevertheless lose such protection due to the behavior of the client. Waiver can result from disclosure to a party who lacks a common legal interest with the client, for example, by sending privileged information to a third party or if a third party is present during a conversation. Waiver of the privilege can be intentional or inadvertent. Examples of a situation where the privilege would be waived include: 

disclosure of privileged information to a client's auditor, accountant, or other party in privity; or



a member of the sales team shares a privileged memoranda or other communication with a client.

There are limits to the waiver of the attorney-client privilege. For example, the Federal Rules of Civil Procedure and the Federal Rules of Evidence provide some

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protections if an inadvertent disclosure occurs in the context of litigation.2 Federal Rule of Evidence n. 502 sets limits on the how the disclosure of a privileged communication may result in waiving additional undisclosed communications of the same subject matter. Additionally, the “common interest doctrine” allows for an extension of the attorneyclient privilege in situations where communications were disclosed to third parties so long as the third party shares a common legal interest with the disclosing party. This doctrine has also been extended to situations where disclosure is made between joint defendants of a lawsuit. III.

THE WORK PRODUCT DOCTRINE In addition to the protections provided under the attorney-client privilege, the

courts have long recognized a separate work product doctrine. The work product doctrine protects from disclosure any documents and materials prepared by a party (or its representative) in anticipation of litigation.3 In one way the work product doctrine is broader than the attorney client privilege, because the doctrine’s protections expand beyond communications. However, certain aspects of the work-product doctrine are narrower than the attorney client privilege, namely, the doctrine’s limitation to tangible things prepared in anticipation of litigation. Like the attorney-client privilege, the work product doctrine’s protections can be waived in certain circumstances. IV.

LIMITS OF THE PRIVILEGE: WHEN DOES THE PRIVILEGE NOT APPLY? THE BOUNDARIES OF ATTORNEY-CLIENT PRIVILEGE IN CORPORATE COUNSEL COMMUNICATIONS A.

Generally

2

See, FED. R. CIV. P. 26(b)(5)(B) and FED. R. EVID. 502.

3

See, FED. R. CIV. P. 26(b)(3).

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The privilege often protects communications to corporate counsel for the purpose of obtaining legal advice. However, the extent of the privilege may vary depending upon the parties to the communication. It is often easier to apply the privilege to communications made between a corporation and its outside counsel (typically an attorney at a law firm). Applying the attorney-client privilege to communications between a corporation and its in-house counsel may be more difficult due to the courts’ general reluctance to grant privilege to non-legal communications that happen to involve a corporation’s in-house counsel. This is particularly relevant to corporate counsel who "have become involved in all facets" of corporations. In these situations, the parties must demonstrate that the purpose and intent of the corporate client’s communication with the in-house counsel, including counsel’s presence at meetings, is "predominantly legal," rather than focused on the client’s non-legal needs such as the client’s business objectives, public relations needs, advertising issues, or other non-legal matters.4 Maintaining privilege for communication is made difficult by the substantial compliance needs of many health care entities. These entities generally have compliance departments that are staffed with personnel responsible for ensuring compliance with relevant laws and regulations. However, internal communications with compliance personnel and documents generated by compliance personnel are not necessarily privileged. Rather, these communications are only privileged if primary purpose is to obtain or provide legal advice. As discussed below, these issues have been addressed by a number of recent court decisions.

4

See, Halifax, 2012 U.S. Dist. LEXIS 158944 at *9.

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B.

Legal Decisions Interpreting the Limits of Attorney-Client Privilege 1.

United States ex rel. Baklid-Kunz v. Halifax Hospital Medical Center.

United States ex rel. Baklid-Kunz v. Halifax Hospital Medical Center5 is an important example of how a court may narrowly apply the privilege doctrine to the documents and communications of a health care provider. In Halifax, a whistleblower filed a qui tam action against Halifax Hospital Medical Center (the “Hospital”) alleging civil violations of the False Claims Act (“FCA”) due to violations of the Stark Law. The United States subsequently intervened in the case. During discovery, the relator asked the court to determine if various materials were protected by the attorney-client privilege. One group of materials consisted of documents and communications created by non-legal departments and were related to audits and reviews of the Hospital’s compliance efforts. All pages were stamped “Attorney-Client Work Product.” Notwithstanding their labeling, the court found that many of the communications were not privileged because they were not addressed to an attorney. Even those communications that were addressed to an attorney were not privileged if they were also addressed to many other non-attorneys. The court reasoned that, in such cases, “the corporation cannot claim that the primary purpose of the communication was for legal advice because the communication served both business and legal purposes.”6 A second group of materials consisted of a compliance log that the Hospital maintained of possible compliance issues that might warrant further investigation. The

5

United States ex rel. Baklid-Kunz v. Halifax Hosp. Med. Ctr., 2012 U.S. Dist. LEXIS 158944 (M.D. Fla. Nov. 6, 2012).

6

Halifax at *11-*12 citing In re Seroquel, 2008 U.S. Dist. LEXIS 39467, 2008 WL 1995058, at *4.

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log listed each complainant, the complaint, and the hospital’s corrective action. These log sheets were all labeled “Confidential Attorney-Client Privileged Information.” The court ruled that the referral log was not privileged, holding that none of the logs evidenced legal advice being sought or received.7 In making its determination, the court noted that in no instance had a lawyer commented on the information recorded nor had an employee in the Compliance Department indicated that he or she would seek advice of counsel. Further, the court concluded that some of the information in the log can only be characterized as a recordation of fact.8 Similarly, the relator in Halifax challenged applying the attorney-client privilege to numerous documents related to the facilitating, rendering and requesting of compliance advice. The Hospital argued that these documents were privileged because its organizational structure is such that the compliance department “operates under the supervision and oversight of the legal department.” The court denied the Hospital’s assertion of attorney-client privilege, concluding that the organizational structure of the Hospital is not a consideration in a privilege analysis. The court then determined that Halifax failed to otherwise meet its burden to prove that the primary purpose of each document was to seek or give legal advice. 2.

Craig v. Rite Aid Corp.

The mere copying of in-house attorneys on internal compliance communications will also not suffice to invoke the privilege. In Craig v. Rite Aid Corp.,9 a United States

7

Halifax at *21.

8

Halifax at *21.

9

Craig v. Rite Aid Corp., No. 4:08-cv-2317, 2012 U.S. Dist. LEXIS 16418, at *28 (M.D. Pa. Feb. 9, 2012) (citing United States v. Chevron Texaco Corp., 241 F. Supp. 2d 1065, 1076 (N.D. Cal. 2002)).

8

Magistrate Judge for the Middle District of Pennsylvania found that communications related to a pharmacy’s corporate reorganization were discoverable, notwithstanding the fact that in-house counsel were copied on the communications. The judge explained that, in order for the communications to be privileged, the company needed to “make a ‘clear showing’ that the speaker made the communications for the purpose of obtaining or providing legal advice.”10 The judge found that documents, including emails on which the in-house counsel was copied, were not privileged because they contained businessrelated considerations about the pharmacy’s restructuring.11 3.

In Re Kellogg, Brown, and Root.

Other courts have not been as restrictive as the Halifax court. In In re Kellogg Brown & Root, Inc.,12 the relator in an FCA case sought to discover documents generated by a government contractor in connection with an internal investigation that was conducted in accordance with the company’s compliance policies. As a contractor, the company was required to maintain an ethics and compliance program that provided for a mechanism of internal reporting and disclosure for certain types of misconduct. The District Court in Kellogg ruled that they would only consider communication to be obtained for legal advice if “the communications would not have been made ‘but for’ the fact that legal advice was sought.”13 Accordingly, the District Court concluded that the internal investigation materials were not privileged given that the investigation was

10

Id.

11

Id. at *35.

12

United States ex rel. Barko v. Halliburton Co., 2014 U.S. Dist. LEXIS 36490 (D.D.C. Mar. 6, 2014).

13

Id. at *7-*8.

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undertaken in response to regulatory law and corporate policy rather than for the purpose of obtaining legal advice.14 The D.C. Circuit court vacated the District Court’s ruling, stating that the District Court’s ruling would limit the attorney-client privilege to only those cases where the sole purpose was to provide legal advice. The Circuit Court warned that such an approach would “eradicate the attorney-client privilege for internal investigations conducted by businesses that are required by law to maintain compliance programs, which is now the case for a significant swath of American industry.”15 The Circuit Court went on to hold that “[s]o long as obtaining or providing legal advice was one of the significant purposes of the internal investigation, the attorney-client privilege applies, even if there were also other purposes for the investigation and even if the investigation was mandated by regulation rather than simple an exercise of company discretion.”16 The Kellogg decision suggests that entities conducting an internal investigation may conduct the investigation under the direction of in-house counsel (outside counsel not always being necessary) and that employee interviews may be conducted at the direction of counsel (but that counsel need not personally conduct the interviews). While there are no “magic words,” employees should be made aware that the company’s legal department is conducting an investigation of a sensitive nature and that the information that they disclose will be protected.

14

Id. at *8.

15

In re Kellogg Brown & Root, 756 F.3d 754, 759 (D.C. Cir. 2014).

16

Id. at 758-59.

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4.

U.S. ex rel. Garbe v. Kmart Corp.

U.S. ex rel. Garbe v. Kmart Corp.17 stands for the proposition that the disclosure of attorney work product in the context of a government investigation may lead to a waiver of work product protection. As discussed above, the general rule is that a party may not discover documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative. In Garbe, a relator moved to compel production of attorney-generated information that the defendant had given to the Office of the Inspector General of the U.S. Department of Health and Human Services (the “OIG”) in response to an administrative subpoena. Outside counsel had prepared a subset of Medicare data in an "easier to understand format" and voluntarily provided their work product to the OIG under a confidentiality agreement that did not address attorney-client privilege.18 The relator in Garbe argued that any attorney work product protection has been forfeited by its disclosure to the government.19 The company rejoined that it had only "selectively waived" work product production to the federal government, and that the data should remain protected from disclosure to the relator. Ultimately, the court rejected the company's selective waiver argument and required the information to be produced to the relator, in part because of the company’s calculated decision to produce the documents in order to obtain a strategic advantage in the OIG investigation.20

17

United States ex rel. Garbe v. Kmart Corp., No. 3:12-cv-00881-MJR-PMF , 2014 U.S. Dist. LEXIS 73261 (S.D. Ill. May 29, 2014).

18

Id. at *03.

19

Id.

20

Id. at *12.

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V.

MAINTAINING PRIVILEGE IN INTERNAL INVESTIGATIONS GENERAL PRINCIPLES Notwithstanding the limitations described above, and the variation in how

different courts limit the doctrine of attorney-client privilege, certain practices may increase the likelihood that the communications related to a health care organization’s investigation will be protected by the attorney-client privilege. A.

Timing is Key

Internal investigations conducted before the appropriate legal oversight is in place may jeopardize the attorney-client privilege. Matters reviewed or interviews conducted before or without direction from counsel may not be privileged. Accordingly, ensure that all parties understand the processes and procedures by which legal oversight will be incorporated into the investigatory process. B.

Consider Using Outside Counsel

Generally speaking, courts typically presume that communications with outside counsel are privileged. Therefore, working with outside counsel may increase the odds that the communications related to the investigation retain their protection. Outside counsel may have greater and more varied experience conducting and overseeing internal investigations and may be viewed by those within the organization as more neutral. C.

Maintain Direction by Attorneys

Only that portion of the investigation directed by an attorney will fall within the attorney-client privilege. Nevertheless, attorneys may direct non-attorneys to conduct portion of investigation and still maintain the privilege.

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D.

Separate Business and Legal Discussions

As discussed above, the intermingling of business and legal discussions can be fatal to maintaining privilege. In-house counsel fulfilling both legal and compliance duties should clearly state when providing legal advice. E.

Ensure Proper Communication with Employees

When conducting an attorney-directed investigation, health care entities should: 

advise any employees being interviewed that their interview is being conducted by an attorney, or if a non-lawyer is interviewing, at the direction of the legal counsel;



advise the employees not to discuss the matter with anyone other than the investigator or the lawyer directing the investigation;



stress to the employees that the information provided is of a sensitive nature and disclosure to third parties would be protected by the attorneyclient privilege; and



when communicating with attorneys, only include those employees who need to be included.

VI.

THREE STEPS TO CONDUCTING INTERNAL INVESTIGATIONS: DEFINE, DEVELOP, PERFORM A.

Define the Investigation

Health care entities should ensure that they fully understand the allegations and issues that have been raised. However, it is possible that the allegations may change during the course of the investigation, so don’t investigate with “blinders on.” At the

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same time, be cautious in assigning titles to every allegation or issue – not every billing issue is potential fraud. In defining the investigation, entities should consider: 

What is being investigated?



What is the proper scope of the investigation? General? Specific?



How was the issue raised?



What is the entity’s whistleblower policy? What whistleblower protection laws apply to the entity?

B.

Develop an Investigation Plan

Entities should develop an investigation plan that will guide the investigation as it proceeds. An investigation plan must address a number of considerations, including: 

Should the investigation be conducted under the cloak of privilege? o The timing of this consideration is crucial. It may be necessary to consult your team or legal counsel to determine, before any investigation, whether a matter should be put under privilege, and the steps that must be taken to ensure that the communications maintain their privileged status. Recall that, for the attorney-client privilege to apply, the entire investigation must be conducted or directed by counsel.



What is the scope of the investigation? o Research the issues being raised. Understand and document the situation or activity being reviewed. Creating flow charts of any relevant organizational processes may help. When researching the

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issue, you should strive to gain an understanding of legal and/or regulatory implications involved. You should also identify the risks implicit in the area being reviewed. o Define the organizational unit to be investigated. Is the investigation limited to one department/facility? o Review related policies and procedures. o Determine whether existing controls are in place to prevent the improper/illegal practice, from occurring. o Determine the amount of time and resources required to conduct the investigation. 

What are the objectives of the investigation? o What steps must be taken to achieve the objectives of the investigation? Outline each detailed step/action required to complete the investigation. Develop audit tools or questions to guide interviews.



What investigative methods will be used (e.g., interviews, document review, process reviews, audits, etc.)? o If employees will be interviewed, which employees will be interviewed? o If documents will be reviewed, how will they be reviewed?

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

What types of documents will be reviewed? Examples in the long term care setting may include nurses’ notes, MARS staffing schedules, time cards, CNA flowsheets, billing documents, personnel records, EMS runs, hospital records, coroner’s reports, autopsies, SMART reports, resident funds accounts records, cost reports, etc.





How will they be obtained?



Who should review them?

Should internal or outside investigators be used? o Internal

resources

may

reduce

out-of-pocket

costs,

but

consideration must be given to the type of allegation as well as who within the organization will be investigated/interviewed. 

How will the employees conducting the investigation (if any), actually conduct the investigation under counsel’s direction? Discuss details of your investigation plan with employees conducting the investigation before they begin. o Make sure they understand the scope of the investigation. o Make sure you agree on reporting of findings. o Make sure they are aware of legal issues. o Once they agree on appropriate action plan, they can begin the investigation under counsel's direction.

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

How should the investigation be evidenced? Employee statements or written summaries of interviews? Transcripts or written statements may be subject of production regardless of the attorney-client privilege. Additionally, the application of attorney-client privilege may depend upon who takes the witnesses’ statements.



Have unrelated issues arisen? If so, consider a separate investigation.



Do employees need to be suspended pending the outcome of the investigation?



What will the final written report of the investigation look like? o Should you make verbal or written recommendations? o Should you include action items?

C.

Perform the Investigation

Creating a plan for the investigation is only the preliminary step in appropriately conducting an internal investigation. The actual performance of the investigation is crucial to achieving the desired objectives.

When performing an investigation, the

following steps should be taken.21 

Notify personnel of entity/activity to be reviewed.



Perform an entrance conference with essential personnel to discuss purpose of the investigation.

21

This list is not meant to be exhaustive, as each organization is unique and, therefore, may require different and/or additional steps.

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

Advise employees of the company’s expectations of them (i.e. honesty, cooperation, confidentiality).



Advise employees not to alter or destroy existing documents/records or create new documents/records.



It may be necessary to provide a written legal hold notification to the employees (or other departments/vendors that have a role in document retention and destruction).



Complete initial review of documents prior to conducting interviews, if possible.



Conduct interviews by interviewing each person separately.



Conduct process reviews or audits, when applicable.



Document findings as you conduct the investigation. o Prepare adequate documentation of interviews, including who was interviewed, how long interview lasted, when and where it took place, and who was present during the interview. o Avoid transcript-like notes.

VII.

INTERVIEWING TECHNIQUES Organizations conducting interviews as part of their internal investigations will

generally benefit from adhering to the following guidelines: 

Promptly interview all known and potential witnesses. o If under the attorney-client privilege, make sure that the attorney directing the investigation is aware of all witnesses to be

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interviewed, especially if additional witnesses become known after the investigation begins. o Make sure to advise the witness that you are investigating a matter for legal / compliance purposes under the direction of legal counsel and that the investigation is confidential and, if appropriate, subject to privilege as to the organization and third parties; be clear that the organization holds the privilege. o Advise the witness not to discuss investigation with anyone other than you or the law department/legal counsel. o Explain to the witness the purpose of the investigation. 

Locate witnesses, including former employees or contractors and set up interviews as soon as possible.



Outline areas of possible inquiry, but do not script every question.



Think and react. It is not enough just to ask a set of questions and think you are done. You must act and think like an investigator.



Do not be afraid to remain quiet during interview.



Watch the behavior of the employee.



Try to keep a record of the questions you ask during an interview.



Ask open ended questions during interviews.



Make sure to listen intently to the answers of the interviewees.



Be flexible and on the alert for other areas of inquiry that arise during the interviews.



Make notes of the interview and create a summary of the content.

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

Use each witness to help you identify other witnesses or additional documents for review.



Do not be afraid to let the interview alter the course of your investigation.



Invite the witness to contact you if s/he becomes aware of additional information. o Provide instruction for a secure, confidential way to contact you.

VIII. RESEARCH AND ANALYSIS The following principles should be applied by organizations in their review and analysis of the investigatory findings: 

Organize documented findings in a logical fashion to provide a meaningful trail of the work performed.



Determine what additional research you need to perform to fully understand all issues identified during the course of the investigation.

IX.



Identify authoritative documents, treatises, manuals, etc.



Identify experts to assist with investigation or render opinions, if necessary.



Prepare for follow-up interviews if necessary.

PREPARING THE INVESTIGATIVE REPORT A.

General Guidelines 

If employees are investigating at the direction of counsel, discuss findings with counsel before beginning to draft the report.



Prepare adequate documentation to analyze and/or quantify the issues involved.

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

Ensure that you prepare the report objectively.



Prepare a draft report summarizing investigative findings. Mark the report appropriately (i.e. DRAFT, Attorney Work Product. Prepared at the Direction of Counsel in Anticipation of Litigation - but only if you really are anticipating litigation).



Report findings in a narrative format.



Update previously filed external reports as necessary.



Work with counsel to prepare a separate report for governmental agencies if counsel determines that the investigation results meet reportable guidelines.



Organize the investigative report in a logical fashion to provide a meaningful description of the issues investigated, investigation performed, analysis, conclusions and recommendations. When possible, utilize the IRAC approach, discussed below.

B.

The IRAC Approach 

IRAC – Issue, Rule, Analysis, Conclusion o Issue: The report should concisely and clearly identify the issue or issues you are investigating.

Remember, there

could be multiple issues and your issues may change during the course of your investigation. 

The issue(s) listed in the report must match the issues in the Investigative Plan unless they changed during the course of the investigation.

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

Make sure legal counsel directing the investigation is in agreement with the issues presented.



Issues should be factual in nature and not legal. 

Was

Jane

Doe

properly

documenting

therapy treatment time? vs. Was Jane Doe committing fraud by billing for therapy not actually provided. o Rule – The report should include a section describing all the regulations, polices, procedures, etc., that you believe apply to the issue(s) investigated. 

Your job is not to interpret the rules.



It is not sufficient to just say that “this investigator reviewed the applicable policies and procedures as well as the regulations regarding the issues involved in this investigation.”



Identify the specific policies and procedures and ask the person directing the investigation if he/she wants copies attached to the report.



Identify the applicable laws and regulations

o Analysis – This is the most critical part of the report. It should be broken up in two parts: 

Part I: Summary of Investigative Steps. This part should:

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

List all documents reviewed and dates of review.



List

all

witnesses

interviewed,

where

interviewed, for how long, who was present and whether or not witness was cooperative. 

List all internal and external discussions relating to this investigation.

 

Outline final approved Investigation Plan.

Part II: Detailed Factual Summary. 

The key is to report the facts of your investigation so that a person with no knowledge will understand them.



Don’t assume the reader has knowledge of the facts or issues.



There should not be any conclusions or findings in this section – you are simply to report the facts.



Remember your Ws – Who, What, Where, When and Why.



Part Two should follow along the outline of the investigative steps in Part One.

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o Conclusion 

Address

whether

the

allegations/issues

are

substantiated/ unsubstantiated / unable to be determined? 

Distinguish factual findings from legal conclusions; non-lawyers should not draw legal conclusions and should avoid using legal terms.



If purely an HR issue, contact HR before reaching a conclusion.



Make sure the conclusion adheres to the objectives set out in your Investigative Plan.

X.

EMAILS, EMAILS AND MORE EMAILS The ubiquity of email, and the inherent ease and speed with which emails can be

sent, may pose challenges for those conducting an internal investigation. Generally, an entity conducting an investigation should keep in mind the following principles regarding email: 

Every email is subject to review by the company and others.



Don’t expect that everyone will understand what you meant to say in your email – email is very linear.



If you must email, mark the subject as you would a report (e.g., Attorney Work Product, Attorney-Client Privileged).



There may be situations where a phone call is more appropriate than an email.



Copying counsel on emails may not confer protection.

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o Documents prepared by non-attorneys and addressed to non-attorneys with copies sent to counsel are generally not privileged. 

For example, a court found that certain documents related to a corporate restructuring process, including emails copying in-house counsel, were not privileged because they concerned factual matters or business-related considerations.

o Must “make a clear showing that the speaker made the communications for the purpose of obtaining or providing legal advice.” XI.

IS THE "LITIGATION HOLD" NOTICE DISCOVERABLE? In United States ex re. Barko v. Haliburton Co.,22 defendant Kellogg, Brown &

Root, Inc. (“KBR”) was ordered to produce the litigation hold notices that it circulated to company employees. Although the court recognized that other courts found notices to be protected by attorney-client privilege, these notices were not protected because they: 

were shared more widely than necessary;



were not intended to be confidential even though labeled "privileged and confidential";



lacked confidentiality instructions;



were distinguishable from the "generic case";



merely described KBR's document retention policies, rather than related to attorney prep for litigation; and

22

United States ex rel. Barko v. Halliburton Co., 1:05-CV-1276, 2014 U.S. Dist. LEXIS 162680 (D.D.C. Nov. 20, 2014).

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

contained facts likely to lead to admissible evidence.23

Further, the court noted that KBR employees were encouraged to share the notice with other employees who may not have received it. XII.

RETAINING PROFESSIONALS WITHOUT DESTROYING THE PRIVILEGE Health care organizations must pay careful attention to their use of outside experts

and professionals. Disclosure of information to third parties, including experts and professionals, can lead to a forfeiture of the attorney-client privilege. To maintain the privilege while retaining or hiring experts and professionals, the general rule is that the communication must be “made in confidence for the purpose of obtaining legal advice from the lawyer.”24 The professional's presence must be “necessary, or at least highly useful, for the effective consultation between the client and the lawyer.”25 For these reasons, an attorney should always directly engage the consultant or other professional. XIII. ADDITIONAL TIPS ON PRESERVING THE PRIVILEGE 

Be explicit about seeking or providing legal advice – but only when you actually are. o “I am writing to request your legal advice.” o “Attached is my legal analysis regarding the question of….”



Lawyers should provide legal advice instead of simply noting facts when conducting an investigation.

23

Id. at *16-*17.

24

United States v. Kovel, 296 F.2d 918, 922 (2d Cir. N.Y. 1961).

25

Id.

26



If lawyers write memos to file, include legal analysis, reference statutes, regulations, cases. Seek or provide legal advice!



Documents created by non-lawyers in connection with an internal investigation should be created at the direction of counsel, and should explicitly reference that fact.



Mental impressions of a fact witness are discoverable and should not be memorialized.



During pre-suit fact investigations, label materials "In Anticipation of Litigation" – but only if they actually are.



When in doubt, consult in-house or outside counsel. ****

27