Criminal Charging of Corporations and the Attorney-Client Privilege Protection Act

The attorney-client privilege is an evidentiary principle that supplements rather than supplants constitutional protections such as the Fifth Amendment right against self-incrimination and the Sixth Amendment right to a trial by jury.  The basic principle is that an individual can generally not be compelled to produce communications made to an attorney made in preparation for a criminal defense or made during the course of a criminal defense.  The policy objective underlying the attorney-client privilege is that criminal defendants, confronted with the typically superior resources of states and prosecutors, should be allowed to communicate openly and completely with their legal representatives.  In terms of criminal court practice, therefore, the attorney-client privilege is a defensive evidentiary tool that may be invoked in court proceedings to prevent the disclosure of communications made between a criminal defendant or client and an attorney.  The communication itself is treated as a type of possessory interest, this interest is attributed to the criminal defendant, and while the attorney may invoke the attorney-client privilege on behalf of the client the privilege belongs to the client.

It is important to note, however, that the attorney-client privilege is not an absolute privilege and that it may be voluntarily relinquished or waived during the course of criminal proceedings.  Waivers most frequently occur when criminal defendants desire to establish a cooperative posture with respect to the prosecution in an effort to secure more lenient results in terms of charges levied or even at the sentencing stage.  In addition to voluntary waivers, there are situations when the attorney-client privilege is deemed not to apply to particular types of communications.  A communication involving the perpetration of a fraud, for instance, may be treated as a communication outside the scope of the attorney-client privilege in such instances, a judge in a criminal court proceeding may reject the evidentiary claim of privilege and compel disclosure of the communication.  The limitations pertaining to the applicability of the attorney-client privilege have long been defined in terms of competing interests among prosecutors seeking relevant information to use in criminal court proceedings and the need to promote open and unhindered communications between individuals and their attorneys.  A particularly contentious debate about the nature of the attorney-client-privilege and the waiver versus compulsory disclosure exceptions has arisen in the past decade with respect to corporate defendants in criminal proceedings.  Indeed, aggressive prosecutorial efforts to secure communications made between corporate defendants and corporate attorneys have led one legal scholar to argue that the demise of the corporate attorney-client privilege and work product doctrine is imminent HYPERLINK httpwww.questia.comPM.qstaod5034195374(OSullivan, 2008, p. 1237).

A fear has developed, based on specific prosecutorial policies and practices, that although the attorney-client privilege applies to corporations as artificial or quasi-individuals, that it is effectively being eliminated by overly aggressive prosecutors.  This debate, in turn, has compelled Congress to consider passing federal legislation in the form of the Attorney-Client Privilege Protection Act in order to maintain the integrity of the attorney-client privilege within the context of corporate defendants in federal criminal court proceedings.  In an effort to better illustrate the nature of this debate, this paper will examine two recent law review articles addressing the application of the attorney-client privilege to corporate criminal defendants, how the privilege has been threatened by aggressive Department of Justice practices, and the implications of alternative courses of action.

Literature Review
OSullivan, a Professor at Georgetown University Law center writing in the American Criminal Law Review, engages in an exhaustive analysis of both case law and statutory law in an effort to establish that, in the context of criminal court proceedings, a corporation is entitled to the same fundamental attorney-client privileges as an individual.  As a point of analytical departure, the author begins by noting that the United States Supreme Court in Upjohn Co. v. United States conceded that corporations were entitled to the attorney-client privilege in criminal proceedings.  Specifically, at the time this case was being tried back in the 1970s and early 1980s, the scope of the attorney-client privilege in the corporate context was unsettled HYPERLINK httpwww.questia.comPM.qstaod5034195374(OSullivan, 2008, p. 1242).  In the Upjohn case the corporation was suspected of violating certain criminal laws for providing payments characterized as bribes to foreign government officials as a tool for generating business contracts as a consequence of these allegations of criminal wrongdoing, the Upjohn executives ordered the corporations attorneys to initiate and to pursue an internal investigation regarding these particular payments.

The Internal Revenue Service subsequently requested these investigatory documents, Upjohn refused citing the attorney-client privilege, and the United States Supreme Court ultimately decided in 1981 that these documents included legal communications between the corporation and its attorneys.  From 1981, therefore, corporations were entitled to the same attorney-client privilege as individuals.  Problems arose, as the author notes, with a new round of corporate scandals involving such highly visible corporations as Enron.  In response to the belief that corporations were abusing the attorney-client privilege in a series of deliberate efforts to hide fraud and wrongdoing not protected by the attorney-client privilege, the Department of Justice drafted and implemented new attorney-client waiver rules and policies.

Specifically, the U.S. Department of Justice, it is charged, have routinely insisted that corporations waive these protections to secure cooperation credit and declination of criminal action against the corporate actor andor consideration at sentencing HYPERLINK httpwww.questia.comPM.qstaod5034195374(OSullivan, 2008, p. 1238).  By insisting that corporations waive the attorney-client privilege, federal prosecutors are effectively attempting to blackmail corporations by threatening to pursue more aggressive tactics unless corporations waive a fundamental evidentiary right.  Congress, recognizing how federal prosecutors are attempting to unilaterally abrogate the attorney-client privilege for corporations as recognized in Upjohn, has for the past five years unsuccessfully proposed an Attorney-Client Privilege Protection Act specifically designed to force federal prosecutors to give up these aggressive tactics more particularly, the Attorney-Client Privilege Protection Act has been introduced that would bar federal prosecutors from asking organizations to disclose information protected by the attorney-client privilege HYPERLINK httpwww.questia.comPM.qstaod5034195374(OSullivan, 2008, p. 1238).  Thus far, given the fact that public opinion is highly suspicious of corporate intentions in light of corporate debacles such as that in the Enron case, the legislation has not been enacted.   OSullivan believes that the problem should be attributed to federal prosecutors for being too aggressive and that the proposed legislation is unnecessary so long as all parties respect the type of attorney-client parameters set down in Upjohn.  She fears that political considerations, in sum, will upset fairly reasonable legal parameters with respect to the attorney-client privilege and corporations in criminal court proceedings.

Gilman, writing in the Fordham Urban Law Review, expresses similar fears and argues that Corporate fraud has and will continue to capture national attention HYPERLINK httpwww.questia.comPM.qstaod5034171996(Gilman, 2008, p. 1076) and further that Cooperation in a criminal investigation often involves a degree of coercion. Severe consequences might befall the subject of an investigation who refuses to cooperate or strike a deal with prosecutors HYPERLINK httpwww.questia.comPM.qstaod5034171996(Gilman, 2008, p. 1075).  The key, in the authors opinion, is to avoid extreme reactions which would substantively alter the well-established principles of the attorney-client privilege in any significant manner.  The proposed Congressional legislation is therefore too restrictive because it would handcuff prosecutors and take away the coercive powers that are an integral part of the prosecutorial and evidentiary collection functions.  In the same way, the author also acknowledges that federal prosecutors responding to politically-charged corporate scandals have institutionalized coercive waiver and disclosure policies which threaten the legitimacy of the attorney-client privilege.  Interestingly, Gilman advocates a sort of middle legislative compromise in which  Congress should consider enacting selective waiver provisions, which, in practice, would do much to ease the concerns of those who vehemently oppose the DOJ corporate charging policy HYPERLINK httpwww.questia.comPM.qstaod5034171996(Gilman, 2008, p. 1084).  This is an interesting proposal because it seeks to allow federal prosecutors to retain coercive discretion while at the same time avoiding the sweeping restrictions included in the Attorney-Client Privilege Protection Act.

A review of these two scholarly articles demonstrates a number of relevant points with reference to the application of the attorney-client privilege with respect to corporations and criminal court proceedings.  First, most academic commentators believe that the Congressional approach via the Attorney-Client Privilege Protection Act is unnecessary and undesirable.  Case law such as the Upjohn case establish more flexible parameters while allowing for prosecutorial coercion in appropriate circumstances and simultaneously safeguarding the procedural and substantive integrity of the attorney-client privilege.  Second, both commentators view this debate as being more of a political nature than a legal nature.  This is because corporate scandals have been heavily publicized and politically it seems easier to pass anti-corporate legislation even if is bad or ill-advised legislation.  Finally, and most importantly, both scholars argue that the attorney-client privilege ought to be viewed as an independent doctrine which supplements other constitutional protections within the context of criminal court proceedings to this end, it must be viewed as a well-established right rather than a transient privilege to be abused or revoked.

Doing nothing is simply not a viable option.  First, with respect to the aggressive tactics and perhaps abuses being committed by Department of Justice prosecutors, there is a very real danger that corporations will respond by communicating less openly and less honestly with corporate attorneys.  This would defeat the fundamental public policy objective underlying the very existence of the attorney-client privilege and perhaps lead to claims of inadequacy of counsel because of inadequate communications caused by fears of disclosure.  Second, with respect to the Attorney-Client Privilege Protection Act as proposed, there is a very real fear that the Privilege Protection Act may greatly expand prosecutorial liability for certain conduct during a white-collar investigation. The Privilege Protection Act forbids government attorneys from demanding, requesting, or conditioning treatment on the disclosure of any privileged communication HYPERLINK httpwww.questia.comPM.qstaod5034171996(Gilman, 2008, p. 1081).  Prosecutors might therefore be discouraged from zealously representing the state in criminal prosecutions for fear of prosecutorial liability.  Both extremes seem to create too many negative implications.  The best solution would be an ethical type of self-control exercised by federal prosecutors in criminal proceedings involving corporate defendants lest Congress feel compelled to finally pass the Attorney-Client Privilege Protection Act.

In the final analysis, these articles rather clearly illustrate how Americas political context can threaten to result in extreme legal approaches to old legal issues.  While it may be too much to suggest that political considerations can be wholly extricated from substantive legal debates, it is not too much to suggest that extreme legal reactions can negatively impact the functioning and the legitimacy of the criminal justice system.  Competitive rivalries must be tempered with reasoned analysis and political outrage ought to be replaced with objective discourse.  The attorney-client privilege in the corporate criminal context ought to be interpreted and applied in a manner consistent with the Supreme Courts decision in Upjohn.


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