On June 9, 2016, Acting Associate Attorney General Bill Baer delivered a speech regarding the impact of the Yates Memorandum’s focus on individual accountability and corporate cooperation at the American Bar Association’s 11th National Institute on Civil False Claims Act and Qui Tam Enforcement. The focus of the speech was on the interplay between the Yates Memorandum and investigations and litigation under the False Claims Act (FCA), underscoring the fact that the US Department of Justice’s (DOJ’s) focus on individuals is not limited to the criminal context. (more…)
On Tuesday, August 11, 2015, in United States ex rel. Barko v. Haliburton et al., the U.S. Court of Appeals for the D.C. Circuit issued an opinion vacating another series of rulings by the United States District Court for the District of Columbia that had required defendant Kellogg Brown & Root, Inc. (KBR) to produce the privileged files underlying its internal investigation into allegations that the company defrauded the U.S. government. The District Court had concluded that KBR impliedly waived the privilege by putting the contents of its corporate investigation at issue in the litigation when it produced an in-house lawyer as a deposition witness on the topic of KBR’s investigation and referenced that testimony in connection with its motion for summary judgment. The District Court had also ruled that the attorney-client privilege did not extend to summary reports prepared by KBR’s non-lawyer investigators. In vacating the District Court’s ruling, the D.C. Circuit reached three key holdings.
First, the D.C. Circuit held that KBR did not put the privileged investigation files at issue in the case by merely referencing the testimony in a footnote in its summary judgment brief because “KBR neither directly stated that the [internal] investigation revealed no wrongdoing nor sought any specific relief because of the results of the investigation.” In reaching this holding, the D.C. Circuit reasoned that cursory statements made in footnotes of briefs should not be indulged as a matter of practice, and the mere inference of “no wrongdoing” that could be drawn from KBR’s footnoted assertion held little weight because as a summary judgment movant, all inferences were to be drawn against KBR.
Second, the D.C. Circuit held that simply designating an in-house lawyer in response to a deposition notice on the topic of the privileged nature of an internal investigation, while still preserving the privilege in response to specific questioning during the deposition, does not compel the production of privileged materials reviewed by the witness to prepare for the deposition under Federal Rule of Evidence 612. In reaching this holding, the D.C. Circuit observed that “[i]f all it took to defeat the privilege and protection attaching to an internal investigation was to notice a deposition regarding the investigations (and the privilege and protection attaching to them), we would expect to see such attempts to end-run these barriers to discovery in every lawsuit in which a prior internal investigation was conducted relating to the claims.” It was this potential “floodgates” consequence that drove the D.C. Circuit to conclude that “the District Court’s rulings would ring alarm bells in corporate general counsel offices throughout the country about what kinds of descriptions of investigatory and disclosure practices could be used by an adversary to defeat all claims of privilege and protection of an internal investigation.”
Finally, the D.C. Circuit held that the District Court wrongly concluded that some of the summary reports prepared by KBR’s investigators were not privileged because it was clear that portions of the documents summarized statements made to the investigator, who “effectively steps into the shoes the [...]