Wednesday, September 30, 2009

Beware of What You Say to Counsel Representing a Corporation

The Ninth Circuit Court of Appeals issued a decision in United States v. Ruehle,a case that opens by saying "[w]e here explore the treacherous path which corporate counsel must tread under the attorney client privilege when conducting an internal investigation to advise a publicly traded company on its financial disclosure obligations."  The lower court had suppressed "all statements from former CFO William J. Ruehle to attorneys from Irell & Manella LLP, Broadcom's outside counsel, regarding the stock option granting practices at Broadcom."  In reversing this decision, the Ninth Circuit, rejected the lower court finding that Ruehle "had a reasonable belief that Irell and Manella were his lawyers prior to the June 1, 2006 interrogation by Irell, and that he never gave informed written consent, either to the dual representation by Irell or the disclosure of privileged information to third parties..."  The Ninth Circuit found that the lower court had "applied a liberal view of the privilege that conflicts with the strict view applied under federal common law, which governs here."  The Ninth Circuit stated that it "reject[s] the district court's contrary finding that an expectation of confidentiality was established because, upon review of the record, we are left with the 'definite and firm conviction that a mistake has been committed' and thus we determine that this factual finding was clearly erroneous." Some thoughts on this decision:

  • Although at first glance it may seem like the Ninth Circuit is usurping a factual finding of the lower court, there is more to this picture -  it is factual finding, yes, but one that had been determined by a different legal standard.  What is interesting here is that the Ninth Circuit chose not to remand to the lower court when changing the operative standard for determining the issue.  On the other hand, the court's decision implies that the evidence does not create a factual question.
  • Every corporate officer needs to be aware that statements made during an internal investigation may end up in the government's lap. One can't always count on an attorney client privilege to protect these statements.
  • Outside counsel's job in conducting internal corporate investigations may have just been made more difficult as one wonders if corporate officers will want to cooperate in corporate counsel's internal review.  


September 30, 2009 in Defense Counsel, Investigations, Privileges | Permalink | Comments (1) | TrackBack (0)

Sunday, September 27, 2009

Simpson - Corporate Criminal Intent

William A. Simpson, Corporate Criminal Intent - SSRN Abstract -

This paper is about the corporation as criminal defendant. In common-law legal systems a fully constituted criminal offence normally requires proof of both the proscribed action (actus reus) and criminal intent (mens rea). However, it appears highly artificial to describe corporate mens rea with ordinary language terms such as “knowledge,” “belief,” “desire,” or “intention.” After a review of common-law and philosophical approaches to imputing criminal intent to the corporate defendant, this paper proposes a behavioral approach to attributing mens rea to corporations and concludes with a review of the (UK) Corporate Manslaughter and Homicide Act 2007 which, it is submitted, adopts just such an approach.


September 27, 2009 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Schipani - Attorney-Client Privilege in Corporate Criminal Investigations

Cindy A. Schipani, The Future of the Attorney-Client Privilege in Corporate Criminal Investigations - SSRN Abstract -

This manuscript discusses how the Department of Justice (DOJ) has viewed waiver of the attorney-client privilege as an important factor evidencing cooperation when determining whether to enter non-prosecution or deferred prosecution agreements with firms allegedly involved in criminal activities. It further discusses recent changes to the DOJ's guidelines, purporting to take waiver out of the equation in deciding whether to prosecute. Questions remain as to whether the corporate attorney-client privilege is a relic of the past or whether the new guidelines, issued in August, 2008, have indeed restored the privilege to firms under federal investigation.


September 27, 2009 in Scholarship | Permalink | Comments (0) | TrackBack (0)

Friday, September 25, 2009

Hasnas - One Hundred Years of Corporate Criminal Liability

John Hasnas, The Centenary of a Mistake: One Hundred Years of Corporate Criminal Liability, forthcoming American Criminal Law Review - SSRN Abstract -

 This article argues that there is no justification for corporate criminal liability. First of all, corporations are not moral agents capable of morally praise- or blameworthy action, and hence are not properly subject to punishment. Secondly, criminal punishment of corporations is inappropriate because 1) it advances none of the legitimate purposes of punishment, 2) it creates an unacceptable risk of prosecutorial error or abuse, and 3) it is not necessary to address a public harm. The only purpose served by threatening corporations with criminal punishment is to shift the balance in power between the prosecution and defense in white collar criminal cases radically in favor of the prosecution. However, this is inconsistent with the inherent liberal bias of the criminal law that embodies the normative assessment that an unrestrained government is a greater danger to citizens’ well-being than any number of individual criminals. Corporate criminal liability cannot be theoretically justified because it is directly violative of the theoretical structure of Anglo-American criminal law.


September 25, 2009 | Permalink | Comments (0) | TrackBack (0)

Thursday, September 24, 2009

In the News & Around the Blogosphere

Baer - Governing Corporate Compliance

Miriam H. Baer, Governing Corporate Compliance, forthcoming Boston College Law Review - SSRN abstract -

In light of the financial meltdown of 2008, it is reasonable to question whether the prior decade’s emphasis on corporate compliance - the internal programs that corporations adopt in order to educate employees, improve ethical norms, and detect and prevent violations of law - has been fruitful. This Article contends that the key problem with compliance is that we regulate it through an adversarial system that pits federal prosecutors against corporate defense counsel, fueling distrust between corporate entities and the government, and between the corporate employees and the internal monitors tasked with ensuring compliance. Despite this adversarial atmosphere, a number of scholars have suggested that corporate compliance is an example of a more collaborative regulatory approach known as “New Governance.” This Article challenges that notion, arguing that the government’s adversarial stance all but eliminates the experimental and collaborative approach championed by the New Governance movement. The Article further concludes that a New Governance model of compliance regulation is unlikely to take hold. Nevertheless, policymakers should consider New Governance’s administrative stance in lieu of the more punitive, “war-driven” approach that adjudication usually encourages.


September 24, 2009 | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 23, 2009

Ben Kuehne Case Heard in the 11th Circuit

David Oscar Markus (Southern District Florida Blog) reports on the oral argument in the Ben Kuehne case in the 11th Circuit here.  What is most amazing here is that the government was appealing the decision of the lower court. For background see here.  The statute provides that the term monetary transaction "does not include any transaction necessary to preserve a person's right to representation as guaranteed by the sixth amendment to the Constitution." Should we really be spending tax resources on a case like this?


September 23, 2009 in Defense Counsel | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 22, 2009

Vanderbilt Criminal Justice Program

Vanderbilt University Law School now has a Criminal Justice Program, directed by Professor Christopher Slobogin.   The Program sponsored its first Roundtable on September 11 & 12 of this year.   Participants included Douglas Berman (Ohio State), Stephanos Bibas (Pennsylvania), Dan Kahan (Yale), Tracey Meares (Yale), Joan Petersilia (Stanford), Kevin Reitz (Minnesota), Daniel Richman (Columbia), David Sklansky (Berkeley), Kate Stith (Yale), Robert Weisberg (Stanford).   Also participating were members of Vanderbilt’s criminal justice faculty, including Slobogin, Nancy King, Ed Rubin, Nita Farahany, Terry Maroney, Robert Mikos, Alistair Newbern (Director, Appellate Litigation Clinic), Yolanda Redero (Director, Domestic Violence Clinic) and Susan Kay (Director, Criminal Clinic). 

    Six papers were introduced by discussants, followed by comments from the paper’s author and reaction by the rest of the participants.  The featured papers were Tracey Meares & Bernard Harcourt, Randomization and the Fourth Amendment (discussant:  Slobogin); David Sklansky, Hearsay’s Last Hurrah (discussant: Richman); Dan Kahan, Who Perceives What, and Why, in “Acquaintance Rape” Cases? An Experimental Investigation of Culture, Cognition, and Consent  (discussant: Weisberg); Doug Berman, Can Checks and Balances, Penumbras and Footnote 4 Improve Eighth Amendment Jurisprudence (discussant: Mikos); Stephanos Bibas, Alternatives to Imprisonment (discussant: Stith); Kevin Reitz , The Illusion of Proportionality:  Desert and Repeat Offenders (discussant: King). 

    On January 29 and 30, 2010, Vanderbilt’s Criminal Justice Program will be sponsoring a Roundtable for faculty who are early in their careers.   In addition to Vanderbilt’s criminal justice faculty, participants will include Laura Appelman (Willamette), Josh Bowers (Virginia), Eve Brensike (Michigan), Samuel Buell (Washington University), Bennett Capers (Hofstra), Roger Fairfax (George Washington), Barbara Fedders (North Carolina), Lea Johnston (Florida), Erin Murphy (Berkeley), James J. Prescott (Michigan), and Alice Ristroph (Seton Hall).

   Other projects, past and future, of Vanderbilt’s Criminal Justice Program include initiation last March of a Juvenile Justice Colloquium, composed of academics, practitioners and government officials from the Nashville area, and partial sponsorship of a visit this November by the United States Court of Appeals for the Armed Forces, which will hear oral arguments at the school in a criminal case involving a privilege issue.  Additionally, this spring four members of the Program, Farahany, King, Mikos and Slobogin, will teach a short course on  “Sentencing, Corrections, and Punishment,”  which will cover theories of criminal punishment, the relationship between sentencing and actual harms, guidelines sentencing, collateral consequences of convictions (e.g. deportation, disenfranchisement, and forfeiture), probation, state regulation of incarceration (e.g., good-time credits, supervised release, parole, mandatory and discretionary release sentencing systems), and innovations in punishment (e.g. preventive detention, sexual predator statutes, "dangerous offender" statutes, notification, monitoring, mental health courts, drug courts, habitual offender statutes, shaming penalties).  One goal of the course is to develop materials that might be used in a sentencing component to the first year criminal law course, on the theory that a grasp of the nature and scope criminal sanctions and their alternatives is crucial to understanding the theory and current practice of criminal law. 

September 22, 2009 in Conferences | Permalink | Comments (1) | TrackBack (0)

Identity Theft

It is good to see another press article warning of the need to focus on Identity Theft.  See Nirvi Shah, Miami Herald, Identity theft growing, getting harder to stop   DOJ  here has taken a positive step with respect to educating on this crime, and developed a website that provides information such as how to protect yourself from being a victim of identity theft and what to do if you become a victim.

But more is clearly needed.  With the increased use of computers, and with the downturn in the economy - identity theft is ripe for growth.  As noted by the FBI, it even shows up in the mortgage fraud area.  See here

Recognition needs to be given to the fact that computer crimes are difficult to investigate and prove. More money and resources need to be focused on this problem and specifically earmarked for this type of criminality. This is not a place for government shortcuts that merely add new legislation or diminish individual rights in an effort to solve the problem.  Instead of increasing sentencing - just prosecute the individuals who are committing the crimes. It's an area that necessitates hard police work to find the perpetrators and proceed with prosecutions.


September 22, 2009 in Computer Crime | Permalink | Comments (1) | TrackBack (0)

Sunday, September 20, 2009

In the News & Around the Blogosphere

Tim Eberly, AJC, Gwinnett D.A. seeks special grand jury for county land deals

Dan Levine, The Recorder,, Rare Pharmaceutical Fraud Trial Under Way in San Francisco (hat tip to Tiffany Joslyn)

Fried, Frank, Harris, Shriver & Jacobson, Civil False Claims Acts: D.C. District Court Decision Limits Retroactive Effect of FERA Amendment to Pending "Claims," Not Pending Cases

Tom Fowler, Houston Chronicle, How case against BP traders went wrong

Michael Cooper, NYTimes, On the Lookout for Stimulus Fraud

Daniel Newhauser, BLT Blog, Former Justice Official Takes the Fifth

Sheri Qualters, National LJ, One-third of companies report no Foreign Corrupt Practices Act compliance programs

Mike Scarcella, BLT Blog,Film Producers Found Guilty in FCPA Bribery Case

Brenda Sapino Jeffreys, Texas Lawyer,,  Federal Public Defender's Office Now Represents R. Allen Stanford in Criminal Case

Neil A. Lewis, NYTimes, Justice Dept. Investigates Ex-Official’s Ties to Shell

Zachery Kouwe, NYTimes,Judge Rejects Settlement Over Merrill Bonuses

Michael Pollick, Sarasota Herald, Has the Gulf Coast become a Ponzi haven?

Zachery Kouwe, NYTimes, Judge Rejects Settlement Over Merrill Bonuses


September 20, 2009 in News | Permalink | Comments (0) | TrackBack (0)


ABA - Second Annual Sentencing Advocacy, Practice and Reform Institute  - November 6, Washington, D.C. - Download 2009fallconference

ABA - Fourth Annual National Institute on Securities Fraud - October 15-16, Washington D.C. here




September 20, 2009 in Conferences | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 16, 2009

NACDL’s Sept. 16, 2009, White Collar Crime CLE – “The Strategy of Secrets: The Use of Classified Information in White Collar Cases”

Guest Blogger: Michael Price, Coordinator for National Security, National Association of Criminal Defense Lawyers (NACDL)

This evening we had the privilege of spending the last two hours learning first-hand from the lawyers who defended Zacarias Moussaoui, AIPAC lobbyist Steve Rosen, Wadih El-Hage, Mohamed El-Mezain, David Hicks, and Dr. Ali al-Timimi. They discussed the use of classified information -- both defensively and offensively – in criminal proceedings. Attorney Joshua Dratel, an NACDL board member and an expert in issues related to the use of classified evidence in criminal proceedings, moderated tonight’s panel. The panel also included attorneys Abbe D. Lowell, a partner in the law firm of McDermott Will & Emery LLP and head of the Firm’s White-Collar Criminal Defense practice group in Washington, D.C., and Edward B. MacMahon, Jr., who serves as a member of NACDL’s National Security Committee and, like Joshua Dratel, as an attorney with the John Adams Project, a joint effort of NACDL and the ACLU. You can read more about these esteemed panelists by simply clicking their names and linking to their biographies.

The Classified Information Procedures Act (“CIPA”) establishes detailed procedures for “matters relating to classified information that may arise in connection” with a prosecution. In essence, it regulates the use of classified information in criminal cases. In practice, it almost exclusively prohibits it. The ever-broadening definition of “national security” together with the incentives for law enforcement to characterize criminal matters as implicating “national security” render “the prospects of otherwise ‘ordinary’ white collar cases involving classified information and CIPA significantly greater,” Dratel explained as he introduced the subject matter of tonight’s panel.

In today's world, the use of evidence the government would rather keep secret has started to, and will continue to, seep into a wide range of federal criminal prosecutions. This panel of highly experienced white collar defenders provided strategic guidance in how to respond when the government claims the evidence in your case is classified as well as when a defender might use CIPA to their own advantage.

In addition to providing practitioners with a primer on fundamental CIPA principles, the panel brought to bear their own experiences as counsel in some of the highest profile criminal matters involving CIPA-related issues, including an extensive discussion of lessons from criminal cases including those of Zacarias Moussaoui and AIPAC lobbyist Steve Rosen. The panelists provided detailed examples of how CIPA issues can arise in white collar matters as well as guidance on (i) how to defend against the government’s invocation of CIPA to withhold classified material and (ii) how to offensively use CIPA to capitalize on the real or possible presence of classified material in aid of the defense.

The panelists explained, in detail, how CIPA, which is not a discovery device, will rear its head in a criminal case, specifically delineating the three general contexts in which it arises in a criminal matter. Ed MacMahon explained how “the first thing that happens is the issuance of an order establishing procedures under CIPA.” The panelists clearly and forcefully emphasized that the constitutional issues that are at play in a criminal proceeding demand that defense counsel constantly be mindful of the importance of the record they are making as they proceed. That said, MacMahon emphasized the importance of counsel not being afraid of CIPA. Though, as Lowell explained, dealing with CIPA issues can be “a very difficult and cumbersome process.” Indeed, often “judges are intimated by the statute,” Dratel said, adding that therefore knowledgeable defense counsel “can be a very important part of the judge’s education.”

The challenges, of course, are significant. For example, the panelists discussed that while the government has the right to take interlocutory appeals of various CIPA-related decision, the defense does not share a parallel right. In addition, while counsel for the defense may be able to secure some level of security clearance to gain access to certain information, in most circumstances the defendant cannot.

In sum, the panelists provided invaluable insight into both the defensive and offensive opportunities presented by this statute. They also provided concrete, practical guidance for conducting a defense where classified information is at play, such as how to leverage different federal agencies’ perceptions of the nature of information in their custody.

As the summer comes to a close, so does NACDL's White Collar Crime CLE Summer Series.  But don't fret, if you weren't able to make it to one or more of these outstanding programs, you can purchase a recording of any or all of them here.


September 16, 2009 in Computer Crime | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 15, 2009

NACDL Summer Series - The Use of Classified Information in White Collar Cases

The last of its summer series, NACDL with Joshua Dratel, Abbe Lowell & Ed MacMahon, Jr this Wed., September 16th on - "The Strategy of Secrets: The Use of Classified Information in White Collar Cases."

Program Summary:

The Classified Information Procedures Act (CIPA) establishes detailed procedures for “matters relating to classified information that may arise in connection” with a prosecution. In today’s world, the use of evidence the government would rather keep secret has started to, and will continue to, seep into a wide range of federal criminal prosecutions. Our panel of highly experienced white collar defenders will provide strategic guidance in how to respond when the government claims the evidence in your case is classified as well as when a defender might use CIPA to their own advantage for affirmative discovery.

Details - CLE Program: 5:00 - 7:00 pm
Wine & Cheese Reception with the Panelists: 7:00 - 7:30 pm

Costs and RSVP see here


September 15, 2009 in Conferences | Permalink | Comments (0) | TrackBack (0)

Monday, September 14, 2009

Does DOJ Need to Rethink How it Conducts White Collar Investigations

Noted here is a discussion of the recent death of an individual who was indicted and had plead guilty in a case related to former Governor Blagojevich. This fundraiser for Blogojevich was facing yet another trial and also the threat of a sooner incarceration (see TalkLeft here).  Today Edvard Pettersson and Jeran Wittenstein of Bloomberg report on the death of Danny Pang, the indicted founder of Private Equity Management Group, Inc. See  Danny Pang Autopsy Shows No Foul Play, Coroner Says

The death of an individual facing indictment, under the strain of an investigation, or being subjected to pressure by the government to cooperate, is nothing new. With increased possible penalties for white collar offenses one has to be concerned about seeing more of these incidents. Sadly, individuals facing these investigations and ramifications garner little if any support from the general public. But perhaps an investigation and compiling of these incidents is warranted.


Addendum - Chicago Breaking News Center -Christopher Kelly may have taken rat poison

September 14, 2009 in Investigations | Permalink | Comments (1) | TrackBack (0)

New Scholarship - Should the SEC Spin Off the Enforcment Division

Professor Peter Henning (Wayne State, visiting at Indiana U- Indianapolis) posted a new piece on SSRN titled, Should the SEC Spin Off the Enforcement Division -

The abstract describes it as:

The current environment is highly supportive of increased government regulation, particularly in the financial field. One of the beneficiaries of this push for greater oversight of the markets appears to be the Securities & Exchange Commission, despite some recent high profile enforcement failures, most particularly the massive Ponzi scheme undertaken by Bernie Madoff. In this essay, I raise the question whether the SEC should retain its enforcement authority over fraud cases, or whether it would be better served if that function were shifted to the Department of Justice. The SEC’s recent push to take on a more prosecutorial air gives the clear impression that an adversarial approach to enforcement of the securities laws is in order. However, the Commission must continue to solicit the views of Wall Street to fulfill its regulatory function, much like Madoff was included in the SEC’s deliberations on rules related to the stock market. At some point in the future, the push for greater regulation is likely to pass from the scene as the pendulum swings back toward a less intrusive approach to oversight. Whether the Commission can resist renewed entreaties to go easier on enforcing the law to free the capital markets from strict regulation is an open question. To allow the SEC to regulate Wall Street properly, splitting off at least a portion of the enforcement function to an agency with expertise in prosecutions - the United States Department of Justice - is at least worthy of consideration as the government looks to increase regulation.


September 14, 2009 in Scholarship, SEC | Permalink | Comments (0) | TrackBack (0)

Saturday, September 12, 2009

Blagojevich Fundraiser: Is Death A Growing Trend

Is it my imagination, or in recent years have there been more deaths of individuals under federal investigation then occurred in the past?  This question comes to mind as I read the Chicago Tribune article titled, Ex-Blagojevich fundraiser Kelly dies of possible OD 

And if death is more common, is it related to the trauma of a white collar offender facing a government investigation?  At this point, just a lot of questions with no answers as the government now investigates the death. With sadness...


September 12, 2009 in News, Prosecutions | Permalink | Comments (5) | TrackBack (0)

Friday, September 11, 2009

In the News & Around the Blogosphere

Jeff Jeffrey, BLT Blog, Holder Declines to Prosecute Schlozman

Holtz Rubenstein Reminick LLP, Town Hall Meeting- Implications & Consequences of Foreign Bank Account Reporting - Wed., Sept. 16th, NYC -  Download September 16 Foreign Income Disclosure - Invite

DOJ Press Release,International Hacker Pleads Guilty for Massive Hacks of U.S. Retail Networks

 Dan Newhauser, BLT Blog, Computer Hacker Pleads Guilty in Major Identity Theft Case

DOJ Press Release, Three Individuals Indicted for Roles in Conspiracy Schemes Involving Two U.S. Environmental Protection Agency Superfund Sites in New Jersey

Terrie Morgan-Besecke, Times Leader, Judges Facing More Jail Time - Racketeering Charge Added to List

Leo Strupczewski And Hank Grezlak, Legal Intelligencer,, Arraignment Scheduled for Former Pa. Judges on Racketeering Charges

Society of Corporate Compliance and Ethics - Upcoming conferences here

Crime & Federalism Blog,DOJ's Office of Professional Responsibility: Protecting Their Own (w/ a hat tip to Tiffany Joslyn)

KattenMuchinRosenman Release, Obama's Pick for Top DOJ Environment Post Appears Headed for Confirmation, Beau Diamond (compilation of articles)

DOJ Press Release, Pennsylvania Businessman Pleads Guilty and Is Sentenced in Puerto Rico Corruption Case


September 11, 2009 in News | Permalink | Comments (0) | TrackBack (0)

In the News & Around the Blogosphere

Cary O’Reilly and Linda Sandler, Bloomberg, Judges Punish Wall Street as Regulators Just Talk About Reform

Florida AG Press Release, Jensen Beach Pastor, Wife Sentenced to Prison for Mortgage Fraud Scheme(sentences of 20 and 10 years and restitution to banks of $700,000.)

Edmund H. Mahony, Hartford Courant,Names Of 4 Finalists For U.S. Attorney For Connecticut Sent To Obama

Michael Pollick, DIAMOND' - Bail denied for currency trader Beau Diamond

Terrie Morgan-Besecker,, Judges Facing More Jail Time - Racketeering Charge Added to List

Daily Business Review,, Former Miami DEA Chief Indicted in Stanford Probe

Jenna Greene, National LJ, SEC Attacked for 'Colossal Failure' Over Madoff

Lynne Marek,, National LJ, Judge wants to make federal sentences easier to calculate 


September 11, 2009 in Mortgage Fraud, News | Permalink | Comments (0) | TrackBack (0)

Thursday, September 10, 2009

The Con Artist Hall of Infamy

Check it out here.


September 10, 2009 in Fraud, News | Permalink | Comments (1) | TrackBack (0)

Wednesday, September 9, 2009

Upcoming Conferences

ABA - Foreign Evidence: Collecting It and Protecting It - Washington, D.C. - Sept. 17, 2009 - Download Foreign Evidence Invitation

ABA - Second Annual Sentencing Advocacy, Practice and Reform Institute With Special Focus on Reentry - Washington, D.C. - November 6, 2009 - here

NACDL - Defending White Collar Crimes - October 1-2, NY - here

American Conference Institute, Foreign Corrupt Practices Act (FCPA) - November 17-18, 2009 - Washington, D.C. here ($200 discount to blog readers when they reference discount code "White Collar Crime."

American Conference Institute, Financial Institution Fraud Enforcement & Financial Recovery - November 16-17, 2009 - Washington, D.C. here [$400 discount off the standard price (for a price of $1795 - no expiration) when they reference discount code "White Collar Fraud"]

ABA - 4th Annual National Institute on Securities Fraud - October 15-16, Washington, D.C. - Download CEN9SFR FINAL BROCHURE 929032_R5


September 9, 2009 in Conferences | Permalink | Comments (0) | TrackBack (0)