The Fifth Amendment, Vicarious Liability, and the Attorney-Client Privilege

There are innumerable ways that a corporation could find itself facing potential indictment and not all of them involve clear-cut situations of “corporate greed” or “executive misconduct” demanding prosecution. While there may be instances in which a prosecutor could wisely exercise discretion and decline to bring charges against a company based on the isolated actions of an employee, these situations do provide a prosecutor with leverage in that “technically,” the corporation could be prosecuted if it did not “cooperate.” See Stoltzfus JS, Davies SL: The Empire Strikes Back: A Critique of the Backlash Against Fraud and Abuse Enforcement. 51 Ala. L. Rev. 239, 258 (1999). But what if by “cooperate,” the prosecution insisted that the company waive the privilege with respect to not just the rogue employee's conduct, but also to that of a company procedure that the company does not believe is illegal? Truth be told, there are probably very few companies that are absolutely free from any threatened criminal prosecution when one considers the standard for criminal vicarious liability. But does that make it appropriate for prosecutors to essentially extort cooperation from those corporations in the form of an attorney-client privilege waiver? Clearly not. But the Thompson Memo provides for no means to prevent such practices. As the next section illustrates, vicarious liability exacerbates a corporation's vulnerability because it lacks any Fifth Amendment protection.

The Fifth Amendment Protection Against Self-Incrimination for Individuals

In pertinent part, the Fifth Amendment to the U.S. Constitution requires that “no person … shall be compelled in any criminal case to be a witness against himself… ” See Akhil AR, Lettow RB: Fifth Amendment First Principles: The Self Incrimination Clause. 93 Mich L. Rev 857, 860-98 (1995). Even before it ever became a part of our Constitution, the right against self-incrimination was essential to our sense of justice. While there are several reasons we hold the right against self-incrimination to be a core value, there is no single, clearly articulated justification that explains why we hold the concept so dear. Many of the reasons that have been articulated can be reduced to two central themes: first, a concern for personal integrity and privacy, and; second, protecting individuals from the power of the government. To overcome these concerns, the government can grant immunity to a witness for giving testimony or producing documents. Otherwise, the individual retains the Fifth Amendment privilege against self-incrimination even when providing incriminatory evidence.

The Fifth Amendment privilege extends beyond oral testimony. See Amar and Lettow, supra. It also applies to the production of documents, but it functions differently when it comes to documentary evidence than when testimonial evidence is at issue. Documents are often requested by a subpoena duces tecum, the tool by which a grand jury can compel testimony and the production of documents when it is investigating a potential crime.

Whether or not any Fifth Amendment protection attaches to an individual's production of document pursuant to a subpoena involves an analysis under the act of production doctrine. Developed in Couch v. United States, 409 U.S. 322 (1973), Fisher v. United States, 425 U.S. 391 (1976), and Andresen v. Maryland, 427 U.S. 463 (1976), the doctrine ignores the proprietary aspects of documents. Instead, the act of production doctrine queries whether there will be testimonial aspects of handing over the documents, for which immunity must be granted. While people are no longer protected against compelled production of preexisting materials that are incriminatory in content, they are protected against incriminating inferences that can be drawn from the act of producing them. “Compliance with [a] subpoena tacitly concedes the existence of the papers demanded and their possession or control by the [individual].” Fisher, supra, at 410.

Producing documents alone does not violate the Fifth Amendment when the accused turns them over, unless the accused is impliedly admitting something incriminating by producing them, or providing the government with evidence it would not have otherwise obtained. In either case, the government must provide immunity. Fisher, supra, at 410; 18 U.S.C. '' 6002-6003 (2002). Statutory immunity provisions must provide, at the minimum, immunity coextensive with the right itself. Kastigar v. United States, 406 U.S. 441, 448 (1972). More recently, the U.S. Supreme Court explained in Hubbell v. United States, 530 U.S. 27 (2000), that the act of producing self-incriminating documents has a compelled testimonial aspect worthy of Fifth Amendment immunity. Id. at 44. In short, the primary thrust of Hubbell was that the Fifth Amendment protects a witness from being prosecuted for crimes discovered only through the documents that were turned over. Id. at 44-45. It is clear that the Fifth Amendment continues to protect natural persons from their own self-incriminatory documents.

Fifth Amendment Protection in the Corporate Context

Corporations do not receive the protection of the Fifth Amendment's self-incrimination clause. Beginning at the turn of the 20th century, in the seminal case of Hale v. Henkel, 201 U.S. 43 (1906), the U.S. Supreme Court decided that corporations could not invoke the protections of the Fifth Amendment because these organizations exist at the pleasure of the state and for the public good. That rationale, however, has subsequently been replaced by an understanding that corporations do not represent any individual person. Thus, the self-incrimination clause, which prevents a witness from testifying against him or herself, does not apply to the corporation. Despite this shift in the underlying theory, the law is consistent: corporations do not receive self-incrimination protection.

The Corporation's Only Shield: The Attorney-Client Privilege

The dual curse of vicarious liability and lack of a Fifth Amendment privilege forces corporations to rely exclusively on the attorney-client privilege as its only source of protection against an overreaching government. The attorney-client privilege is one of the oldest protections for all criminal defendants. See American College of Trial Lawyers, The Erosion of the Attorney-Client Privilege and Work Product Doctrine in Federal Criminal Investigations, Approved by the Board of Regents, March 2002, at 4. It is deeply rooted in the common law — even Federal Rules of Evidence 501 states that “the privilege of a witness … shall be governed by the principles of common law as they may be interpreted by the courts of the United States in the light of reason and experience.” Fed. R. Evid. 501; see also Upjohn Co. v. United States, 449 U.S. 383, 389 (1981).

From its early beginnings in English common law to its use in current American legal arenas, the attorney-client privilege has been based on a long-standing principle that this privilege is “in the interest and administration of justice.” Hunt v. Blackburn, 128 U.S. 464, 470 (1888). Generally considered “absolute” unless waived by the client, the “attorney-client privilege may well be the pivotal element of the modern American lawyer's professional functions.” Hazard, GC Jr.: An Historical Perspective on the Attorney-Client Privilege. 66 Cal L. Rev. 1061, 1061 (1978). And its protection is much stronger than the work-product doctrine, which can be overcome by a showing that “relevant and non-privileged facts remain hidden in an attorney's file and where production of those facts is essential to the preparation of one's case.” Hickman v. Taylor, 329 U.S. 495, 511 (1947).

Consider the following. NEWCO, a privately held company, is served with a subpoena seeking information about its chief financial officer (“John Doe”) and certain allegedly fraudulent transactions. In the course of an internal investigation, NEWCO discovers that the Mr. Doe, in fact, did make certain improper transactions on the company's behalf. NEWCO fires John Doe and expresses a desire to cooperate with the government to put this problem behind the company. The government, however, suggests that in the “spirit” of cooperation it should continue the investigation to determine if there is any other wrongdoing.

Under the government's view of cooperation, corporations must help the government catch “the bad guys.” Presumably, if the corporation is cooperating, there is at least one “bad guy.” But does that always mean the corporation and the government agree who the “bad guys” are or how many there are? What if NEWCO believes that the former CFO is a “bad guy,” but concludes that there are no additional “bad guys” to be caught with respect to the fraudulent transactions? Just because the government takes a different view, does that mean there are additional “bad guys” to be caught?

It is highly unlikely that there would be any need for this debate (or criminal defense attorneys for that matter) if guilt and innocence were always clear-cut. The vast majority of cases, however, especially in the corporate context, lie on a spectrum somewhere in between guilty and innocence. Often, the behavior at issue “is often difficult to distinguish from the gray zone of socially acceptable and economically justifiable business conduct.” United States v. U.S. Gypsum Co., 438 U.S. 422, 441 (1978). See also Bucy PH: Indemnification of Corporate Executives Who Have Been Convicted of Crimes: An Assessment and Proposal. 24 Ind. L. Rev. 279, 293 (1991) (explaining that various rules and regulations create “a gray area between legal and illegal conduct.”). It is precisely because of this “gray area” that defense attorneys need the freedom to investigate, research, hypothesize, and ultimately argue its defense to the government without a penalizing affect to the client. The question of whether there are, in fact, more “bad guys” is complicated by current DOJ policy requiring “timely” disclosure in order to obtain credit for cooperation. “Inherent in this approach is that the prosecutor's initial view of the case must be accepted as fact and not be opposed by counsel for the individual or corporation; to do so is to act at the client's peril.” American College of Trial Lawyers, Id. at 2.

Over the last several years, the government has asserted that cooperation is only requested when a corporation has already admitted to doing something wrong. In 2003, former Deputy Attorney General James Comey publicly stated that, “[one] must remember that waiver of the [attorney-client] privilege is voluntary and may only be necessary if the corporation chooses to cooperate in order to obtain leniency from the Government and/or the Court.” See “Interview with United States Attorney James B. Comey Regarding Department of Justice's Policy on Requesting Corporations under Criminal Investigations to Waive the Attorney Client Privilege and Work Product Protection” in the November 2003 United States Attorneys' Bulletin at p.3. But obtaining leniency from the government and/or the Court seems to imply that the corporation has conceded that it did something wrong. But that is not necessarily true. Often, a corporation has only admitted to doing something the government thinks is wrong. In these instances, a corporation may be willing to cooperate with the government, but it may also still believe that the law does not apply to the facts as the government contends. For instance, NEWCO and the government may not disagree on the facts, but they do disagree on whether the facts violate the law. In these instances, is it still fair for the government to request a waiver? Should the corporation suffer for protecting itself?

In this situation, however, NEWCO cannot get credit because according to DOJ policy statements, “for a corporation to get credit for cooperation, it must help the [g]overnment catch the crooks.” Id. at 2. There also appears to be disagreement on what constitutes a waiver. In an illustrative example outlined by former Deputy Attorney General Comey involving a $1 billion accounting error, he hypothesizes that the company “will immediately provide a briefing on what they have learned and will bring in all the witnesses the government will need to figure out exactly what happened.” Comey gives this as an example of where the company would still obtain leniency, despite no waiver. But how is that considered “no waiver?” Indeed, Comey explains: “[c]ooperation doesn't just mean complying with subpoenas. It means — and I hate to sound like a broken record — telling the government what the corporation knows about what happened, who did it, and how they did it. In short, we expect cooperating corporations to help us catch the bad guys.” Id. at 2. Yet telling the government this information will likely entail the corporation's attorney disclosing what she learned in an internal investigation — unquestionably privileged information.

In the current political environment it is paramount that we be vigilant in ensuring that that governmental power is not misused. Numerous commentators are warning about various prosecutorial abuses. Darryl K. Brown stated that, “[t]he criminal justice system is flawed not only because of the particular form and affects of its political responsiveness, but also because prosecutors have essentially no formal external checks on their discretion.” Brown DK: Cost-Benefit Analysis in Criminal Law. 92 Calif. L. Rev. 323, 331 (2004). In a corporate criminal setting, the prosecutors' power is enhanced by the fact that companies oftentimes make decisions based on business realities. In other words, corporations are not likely to use their shareholders' money to fight on account of the “principle of the matter,” even if the company has a solid legal defense. In many instances, it makes more business sense to plead to something, pay a fine, and put that matter behind so that the company can focus on the future and protect shareholder value, rather than subject the corporation, its employees, suppliers, shareholders and customers to the chaos that a criminal indictment engenders. This business reality does little to deter prosecutors from resorting to overkill approaches; indeed, perhaps it encourages them.

Among the means of preventing (perhaps minimizing is the more realistic goal) the potential for prosecutorial overreaching is maintaining the sanctity of the attorney-client privilege. It allows those suspected of committing a crime to speak freely and obtain advice from competent counsel. Again, this article is not intended to belabor prosecutorial excesses. Instead, the implicit presumption underlying current DOJ policy is that federal prosecutors always act responsibly. Experience has shown that this presumption is false — and the consequences are having far reaching negative effects on one of the most venerated principles of American jurisprudence and on corporations across the country.

Waiver of the attorney-client privilege by corporations “cooperating” with the government during investigations of alleged misconduct has become an issue of increasing concern within the legal community. Current U.S. Department of Justice policy, as set forth in a document entitled “Principles of Federal Prosecution of Business Organizations” (dated Jan. 20, 2003, and found at www.usdoj.gov/dag/cftf/corporate_guidelines.htm.), sets forth a number of factors that federal prosecutors should consider when contemplating whether or not to criminally charge a corporation. It clearly states that “[g]enerally, prosecutors should apply the same factors in determining whether to charge a corporation as they do with respect to individuals.” This policy statement goes on, however, to note that “due to the nature of the corporate 'person,' some additional factors are present,” including “[t]he corporation's timely and voluntary disclosure of wrongdoing and its willingness to cooperate in the investigation of its agents, including, if necessary, the waiver of the corporate attorney-client privilege and work-product protection.”

The policy statement discusses at great length why a waiver may be necessary. For instance, it states that “a corporation's cooperation may be critical in identifying the culprits and locating relevant evidence.” It further points out, “[i]n some circumstances, therefore, granting a corporation immunity or amnesty or pretrial diversion may be considered in the course of the government's investigation.” Importantly, while the Memo states that waiver of the privilege is not required, it may be necessary in “appropriate circumstances.”

Unbelievably, there is no guidance on what those appropriate circumstances might be, and it is left to the discretion of local decision-makers as to how to proceed. Indeed, the description of how waivers can be helpful would arguably apply in every federal investigation: “[s]uch waivers permit the government to obtain statements of possible witnesses, subjects, and targets, without having to negotiate individual cooperation or immunity agreements. In addition, they are often critical in enabling the government to evaluate the completeness of a corporation's voluntary disclosure and cooperation.” Such language can easily be interpreted to mean that there is no case in which seeking a waiver is not appropriate. At minimum, federal prosecutors are being given the message that “it never hurts to ask.” While it is clear that corporations are not to be treated any more or less harshly than individual targets, the DOJ's current policy pronouncement impacts them in different ways. A corporation, in a legal sense, is more vulnerable than a “two-legged” defendant for at least two important reasons: 1) An organization has no Fifth Amendment privilege against self-incrimination; and, 2) An organization is vicariously liable for the actions of its agents. The attorney-client privilege is one of the few areas in which an organization has comparable rights with individual targets.

There are innumerable ways that a corporation could find itself facing potential indictment and not all of them involve clear-cut situations of “corporate greed” or “executive misconduct” demanding prosecution. While there may be instances in which a prosecutor could wisely exercise discretion and decline to bring charges against a company based on the isolated actions of an employee, these situations do provide a prosecutor with leverage in that “technically,” the corporation could be prosecuted if it did not “cooperate.” See Stoltzfus JS, Davies SL: The Empire Strikes Back: A Critique of the Backlash Against Fraud and Abuse Enforcement. 51 Ala. L. Rev. 239, 258 (1999). But what if by “cooperate,” the prosecution insisted that the company waive the privilege with respect to not just the rogue employee's conduct, but also to that of a company procedure that the company does not believe is illegal? Truth be told, there are probably very few companies that are absolutely free from any threatened criminal prosecution when one considers the standard for criminal vicarious liability. But does that make it appropriate for prosecutors to essentially extort cooperation from those corporations in the form of an attorney-client privilege waiver? Clearly not. But the Thompson Memo provides for no means to prevent such practices. As the next section illustrates, vicarious liability exacerbates a corporation's vulnerability because it lacks any Fifth Amendment protection.

The Fifth Amendment Protection Against Self-Incrimination for Individuals

In pertinent part, the Fifth Amendment to the U.S. Constitution requires that “no person … shall be compelled in any criminal case to be a witness against himself… ” See Akhil AR, Lettow RB: Fifth Amendment First Principles: The Self Incrimination Clause. 93 Mich L. Rev 857, 860-98 (1995). Even before it ever became a part of our Constitution, the right against self-incrimination was essential to our sense of justice. While there are several reasons we hold the right against self-incrimination to be a core value, there is no single, clearly articulated justification that explains why we hold the concept so dear. Many of the reasons that have been articulated can be reduced to two central themes: first, a concern for personal integrity and privacy, and; second, protecting individuals from the power of the government. To overcome these concerns, the government can grant immunity to a witness for giving testimony or producing documents. Otherwise, the individual retains the Fifth Amendment privilege against self-incrimination even when providing incriminatory evidence.

The Fifth Amendment privilege extends beyond oral testimony. See Amar and Lettow, supra. It also applies to the production of documents, but it functions differently when it comes to documentary evidence than when testimonial evidence is at issue. Documents are often requested by a subpoena duces tecum, the tool by which a grand jury can compel testimony and the production of documents when it is investigating a potential crime.

Whether or not any Fifth Amendment protection attaches to an individual's production of document pursuant to a subpoena involves an analysis under the act of production doctrine. Developed in Couch v. United States , 409 U.S. 322 (1973), Fisher v. United States , 425 U.S. 391 (1976), and Andresen v. Maryland , 427 U.S. 463 (1976), the doctrine ignores the proprietary aspects of documents. Instead, the act of production doctrine queries whether there will be testimonial aspects of handing over the documents, for which immunity must be granted. While people are no longer protected against compelled production of preexisting materials that are incriminatory in content, they are protected against incriminating inferences that can be drawn from the act of producing them. “Compliance with [a] subpoena tacitly concedes the existence of the papers demanded and their possession or control by the [individual].” Fisher, supra, at 410.

Producing documents alone does not violate the Fifth Amendment when the accused turns them over, unless the accused is impliedly admitting something incriminating by producing them, or providing the government with evidence it would not have otherwise obtained. In either case, the government must provide immunity. Fisher, supra, at 410; 18 U.S.C. '' 6002-6003 (2002). Statutory immunity provisions must provide, at the minimum, immunity coextensive with the right itself. Kastigar v. United States , 406 U.S. 441, 448 (1972). More recently, the U.S. Supreme Court explained in Hubbell v. United States , 530 U.S. 27 (2000), that the act of producing self-incriminating documents has a compelled testimonial aspect worthy of Fifth Amendment immunity. Id. at 44. In short, the primary thrust of Hubbell was that the Fifth Amendment protects a witness from being prosecuted for crimes discovered only through the documents that were turned over. Id. at 44-45. It is clear that the Fifth Amendment continues to protect natural persons from their own self-incriminatory documents.

Fifth Amendment Protection in the Corporate Context

Corporations do not receive the protection of the Fifth Amendment's self-incrimination clause. Beginning at the turn of the 20th century, in the seminal case of Hale v. Henkel , 201 U.S. 43 (1906), the U.S. Supreme Court decided that corporations could not invoke the protections of the Fifth Amendment because these organizations exist at the pleasure of the state and for the public good. That rationale, however, has subsequently been replaced by an understanding that corporations do not represent any individual person. Thus, the self-incrimination clause, which prevents a witness from testifying against him or herself, does not apply to the corporation. Despite this shift in the underlying theory, the law is consistent: corporations do not receive self-incrimination protection.

The Corporation's Only Shield: The Attorney-Client Privilege

The dual curse of vicarious liability and lack of a Fifth Amendment privilege forces corporations to rely exclusively on the attorney-client privilege as its only source of protection against an overreaching government. The attorney-client privilege is one of the oldest protections for all criminal defendants. See American College of Trial Lawyers, The Erosion of the Attorney-Client Privilege and Work Product Doctrine in Federal Criminal Investigations, Approved by the Board of Regents, March 2002, at 4. It is deeply rooted in the common law — even Federal Rules of Evidence 501 states that “the privilege of a witness … shall be governed by the principles of common law as they may be interpreted by the courts of the United States in the light of reason and experience.” Fed. R. Evid. 501; see also Upjohn Co. v. United States , 449 U.S. 383, 389 (1981).

From its early beginnings in English common law to its use in current American legal arenas, the attorney-client privilege has been based on a long-standing principle that this privilege is “in the interest and administration of justice.” Hunt v. Blackburn , 128 U.S. 464, 470 (1888). Generally considered “absolute” unless waived by the client, the “attorney-client privilege may well be the pivotal element of the modern American lawyer's professional functions.” Hazard, GC Jr.: An Historical Perspective on the Attorney-Client Privilege. 66 Cal L. Rev. 1061, 1061 (1978). And its protection is much stronger than the work-product doctrine, which can be overcome by a showing that “relevant and non-privileged facts remain hidden in an attorney's file and where production of those facts is essential to the preparation of one's case.” Hickman v. Taylor , 329 U.S. 495, 511 (1947).

Consider the following. NEWCO, a privately held company, is served with a subpoena seeking information about its chief financial officer (“John Doe”) and certain allegedly fraudulent transactions. In the course of an internal investigation, NEWCO discovers that the Mr. Doe, in fact, did make certain improper transactions on the company's behalf. NEWCO fires John Doe and expresses a desire to cooperate with the government to put this problem behind the company. The government, however, suggests that in the “spirit” of cooperation it should continue the investigation to determine if there is any other wrongdoing.

Under the government's view of cooperation, corporations must help the government catch “the bad guys.” Presumably, if the corporation is cooperating, there is at least one “bad guy.” But does that always mean the corporation and the government agree who the “bad guys” are or how many there are? What if NEWCO believes that the former CFO is a “bad guy,” but concludes that there are no additional “bad guys” to be caught with respect to the fraudulent transactions? Just because the government takes a different view, does that mean there are additional “bad guys” to be caught?

It is highly unlikely that there would be any need for this debate (or criminal defense attorneys for that matter) if guilt and innocence were always clear-cut. The vast majority of cases, however, especially in the corporate context, lie on a spectrum somewhere in between guilty and innocence. Often, the behavior at issue “is often difficult to distinguish from the gray zone of socially acceptable and economically justifiable business conduct.” United States v. U.S. Gypsum Co. , 438 U.S. 422, 441 (1978). See also Bucy PH: Indemnification of Corporate Executives Who Have Been Convicted of Crimes: An Assessment and Proposal. 24 Ind. L. Rev. 279, 293 (1991) (explaining that various rules and regulations create “a gray area between legal and illegal conduct.”). It is precisely because of this “gray area” that defense attorneys need the freedom to investigate, research, hypothesize, and ultimately argue its defense to the government without a penalizing affect to the client. The question of whether there are, in fact, more “bad guys” is complicated by current DOJ policy requiring “timely” disclosure in order to obtain credit for cooperation. “Inherent in this approach is that the prosecutor's initial view of the case must be accepted as fact and not be opposed by counsel for the individual or corporation; to do so is to act at the client's peril.” American College of Trial Lawyers, Id. at 2.

Over the last several years, the government has asserted that cooperation is only requested when a corporation has already admitted to doing something wrong. In 2003, former Deputy Attorney General James Comey publicly stated that, “[one] must remember that waiver of the [attorney-client] privilege is voluntary and may only be necessary if the corporation chooses to cooperate in order to obtain leniency from the Government and/or the Court.” See “Interview with United States Attorney James B. Comey Regarding Department of Justice's Policy on Requesting Corporations under Criminal Investigations to Waive the Attorney Client Privilege and Work Product Protection” in the November 2003 United States Attorneys' Bulletin at p.3. But obtaining leniency from the government and/or the Court seems to imply that the corporation has conceded that it did something wrong. But that is not necessarily true. Often, a corporation has only admitted to doing something the government thinks is wrong. In these instances, a corporation may be willing to cooperate with the government, but it may also still believe that the law does not apply to the facts as the government contends. For instance, NEWCO and the government may not disagree on the facts, but they do disagree on whether the facts violate the law. In these instances, is it still fair for the government to request a waiver? Should the corporation suffer for protecting itself?

In this situation, however, NEWCO cannot get credit because according to DOJ policy statements, “for a corporation to get credit for cooperation, it must help the [g]overnment catch the crooks.” Id. at 2. There also appears to be disagreement on what constitutes a waiver. In an illustrative example outlined by former Deputy Attorney General Comey involving a $1 billion accounting error, he hypothesizes that the company “will immediately provide a briefing on what they have learned and will bring in all the witnesses the government will need to figure out exactly what happened.” Comey gives this as an example of where the company would still obtain leniency, despite no waiver. But how is that considered “no waiver?” Indeed, Comey explains: “[c]ooperation doesn't just mean complying with subpoenas. It means — and I hate to sound like a broken record — telling the government what the corporation knows about what happened, who did it, and how they did it. In short, we expect cooperating corporations to help us catch the bad guys.” Id. at 2. Yet telling the government this information will likely entail the corporation's attorney disclosing what she learned in an internal investigation — unquestionably privileged information.

In the current political environment it is paramount that we be vigilant in ensuring that that governmental power is not misused. Numerous commentators are warning about various prosecutorial abuses. Darryl K. Brown stated that, “[t]he criminal justice system is flawed not only because of the particular form and affects of its political responsiveness, but also because prosecutors have essentially no formal external checks on their discretion.” Brown DK: Cost-Benefit Analysis in Criminal Law. 92 Calif. L. Rev. 323, 331 (2004). In a corporate criminal setting, the prosecutors' power is enhanced by the fact that companies oftentimes make decisions based on business realities. In other words, corporations are not likely to use their shareholders' money to fight on account of the “principle of the matter,” even if the company has a solid legal defense. In many instances, it makes more business sense to plead to something, pay a fine, and put that matter behind so that the company can focus on the future and protect shareholder value, rather than subject the corporation, its employees, suppliers, shareholders and customers to the chaos that a criminal indictment engenders. This business reality does little to deter prosecutors from resorting to overkill approaches; indeed, perhaps it encourages them.

Among the means of preventing (perhaps minimizing is the more realistic goal) the potential for prosecutorial overreaching is maintaining the sanctity of the attorney-client privilege. It allows those suspected of committing a crime to speak freely and obtain advice from competent counsel. Again, this article is not intended to belabor prosecutorial excesses. Instead, the implicit presumption underlying current DOJ policy is that federal prosecutors always act responsibly. Experience has shown that this presumption is false — and the consequences are having far reaching negative effects on one of the most venerated principles of American jurisprudence and on corporations across the country.