In-house counsel beware! (obstruction of justice and false statements for incriminating documents)

• Author: Copeland, Katrice Bridges

Introduction I. Background A. The FDA's Investigation of GlaxoSmithKline B. Prosecution Trends and the Lauren Stevens Case 1. Responsible Corporate Officer Doctrine 2. Attorneys As Gatekeepers 3. Pretextual Prosecutions and the Expansion of the Cover-Up Crimes 4. The Corporate Attorney-Client Privilege 5. Conclusion II. The Legal and Policy Arguments A. Misguided as a Matter of Law 1. The Crime-Fraud Exception to the Attorney-Client Privilege 2. Obstruction of Justice 3. The Advice of Counsel Defense B. Misguided as a Matter of Policy 1. The Adversarial System of Justice 2. Prosecutorial Ethics III. Good Faith Conclusion "[A] lawyer should never fear prosecution because of advice that he or she has given to a client who consults him or her, and a client should never fear that its confidences will be divulged unless its purpose in consulting the lawyer was for the purpose of committing a crime or a fraud." (1)

Judge Roger W. Titus

INTRODUCTION

The May 2011 trial of Lauren Stevens, the former Vice President and Associate General Counsel of GlaxoSmithKline (GSK), ended in a judgment of acquittal before the defense called a single witness. (2) The government charged Stevens with obstruction of justice and false statements for failing to turn over allegedly incriminating documents in response to a voluntary request for information from the Food and Drug Administration (FDA) in 2002. (3) The FDA inquiry concerned whether GSK improperly promoted its FDA-approved depression drug, Wellbutrin, for an unapproved use--weight loss--in violation of the Food, Drug, and Cosmetic Act. (4) Judge Titus, who presided over Stevens' trial, found that Stevens acted in good faith and on the reliance of counsel in her response to the FDA's inquiry about Wellbutrin. (5) Thus, Judge Titus held that a reasonable jury could not convict Stevens and granted her motion for a judgment of acquittal. (6)

Members of the defense bar watched the case closely out of fear that a guilty verdict might hamper their ability to represent their clients zealously. After Judge Titus' ruling, the defense bar breathed a collective sigh of relief. But, it is not clear that defense attorneys are out of prosecutors' crosshairs simply because of the Stevens acquittal. Indeed, the prosecution of Stevens reflects and expands on several recent trends in prosecution that will probably not change as a result of the acquittal. First, the government, particularly the FDA, has shifted its focus from prosecuting corporations to prosecuting individuals for misconduct in corporations. (7) The FDA has made recent pronouncements about its desire to hold responsible corporate officers accountable for misconduct at pharmaceutical companies. (8) The FDA has also charged executives with misdemeanors in high-profile health care fraud cases in an effort to deter improper marketing practices within health care companies. (9) It is possible that the government's prosecution of Stevens was an attempt to hold someone in the corporation responsible for the alleged illegal promotional activities of GSK. If the Stevens prosecution is a natural outgrowth of the government's effort to prosecute individuals, then Stevens' acquittal may not deter the government from indicting in-house counsel in the future.

Second, in addition to holding corporate officers responsible for conduct within the firm, the government has stepped up its effort to hold lawyers accountable as gatekeepers at their respective organizations. The government has not been shy about prosecuting in-house counsel at securities firms for facilitating or actively engaging in securities violations with their clients. (10) Prior to the Stevens prosecution, however, the government's focus on in-house attorneys appeared to be based on their involvement in the misconduct. (11) Thus, the Stevens prosecution expands the scope of gatekeeper prosecutions because there is no allegation that Stevens was involved in the actual wrong-doing. As the government has ramped up its efforts to hold in-house attorneys accountable for the actions of their client corporations, it is unlikely that the outcome in the Stevens case will deter the government from continuing to expand its prosecutions of lawyers as gatekeepers.

Third, in recent years, the government has used pretextual prosecutions based on cover-up crimes, such as obstruction of justice, as a quick and effective means of obtaining a conviction in a complicated case. (12) Thus, instead of charging the target of the investigation with the conduct that prompted the investigation, the government has chosen to charge the target for actions taken during the course of the investigation. The Stevens prosecution may reflect the government's attempt to broaden the reach of pretextual prosecutions because the initial target of the FDA's investigation was GSK, not Stevens. There is no reason to believe that the government will stop looking for ways to push the envelope through pretextual prosecutions.

Fourth, the government has a long history of attacking the corporate attorney-client privilege through its charging policies. (13) The government posits that corporations use the corporate attorney-client privilege as a shield to thwart government inquiry into corporate practices. By targeting in-house counsel, the government can gain access to privileged documents that may reveal the misconduct of the corporation. (14) Because the government has a long-standing distrust of the corporate attorney-client privilege, it is unlikely that the government will stop trying to find ways to pierce the privilege.

In short, it is possible that these or other trends will converge again and lead to the prosecution of in-house or outside counsel for actions in connection with the representation of a client during a government investigation. Therefore, it is necessary to examine not only these trends but also the ultimate question of whether Judge Titus is correct. Should attorneys fear being prosecuted for decisions they make during a document production because the government may not agree with their choices? Should the corporate attorney-client privilege be pierced because the government believes that an attorney's actions in responding to its request for information amount to a cover-up of a client's alleged crimes? The government already has a substantial amount of leverage over defense attorneys and their corporate clients. But that leverage would be greater still if the government could threaten to prosecute the corporation's attorney and invoke the crime-fraud exception to the attorney-client privilege any time the government and the defense attorney disagree on the documents that a defense attorney must produce in response to a government inquiry. In the Stevens case, the government viewed the attorney-client privileged documents, but has still not charged the corporation or any of its employees for the alleged illegal promotion that was the original subject of investigation. (15) As a matter of equity, it is difficult to understand how the government can charge an attorney for covering up a client's crime when the government has not even charged the client with a crime.

This Article argues that the prosecution of Lauren Stevens for covering up the alleged crimes of GSK was misguided both as a matter of law and a matter of policy. In particular, this Article contends that the government should not prosecute attorneys for obstruction of justice or other cover-up crimes for actions taken in good faith during a government investigation into a client's conduct. (16) Part I provides background on the Lauren Stevens case and the convergence of the four prosecution trends that led the government to indict her. (17) Part II argues that Lauren Stevens did not obstruct the government's investigation of GSK. (18) Accordingly, the government should not have sought attorney-client privileged documents by invoking the crime-fraud exception or charged Stevens because the evidence did not support the charges. Part III argues that the government should not charge in-house or outside counsel for obstruction of justice when the attorney's actions were taken in good faith during the representation of the client. It proposes that the U.S. Department of Justice (DOJ) provide guidance to U.S. Attorneys on bringing charges against defense counsel. In addition, it recommends that the DOJ institute a rule requiring approval before instituting charges against defense counsel for actions taken during the course of the investigation. (19) This Article concludes that the good faith standard, guidance to prosecutors, and an approval mechanism are necessary actions to rein in overzealous prosecutors who may seek to target their adversaries in government investigations. (20)

1. BACKGROUND

   1. The FDA's Investigation of GlaxoSmithKline

      In 2002, the FDA investigated GSK for promoting Wellbutrin, an antidepressant drug, for weight loss. Under the law, a prescription drug that has been approved by the FDA for one use (depression) may not be promoted as safe and effective for an unapproved use (weight loss). (21) The practice of promoting an approved drug for an unapproved use is referred to as off-label marketing. The FDA sent GSK a letter to inform them that the FDA had reason to believe that GSK had promoted the use of Wellbutrin for weight loss, an unapproved use. (22) In the letter, the FDA requested copies of materials regarding GSK's marketing programs, "including copies of all slides, videos, handouts and other materials presented or distributed at any GSK program or activity related to Wellbutrin." (23) Further, the FDA asked GSK to "identify any compensation provided to individuals involved in programs or activities related to Wellbutrin." (24)

      Lauren Stevens was in charge of GSK's response to the FDA's inquiry and investigation. (25) She led a group of lawyers who collected documents and information to provide to the FDA...