critical steps for responding to government investigations - presentation: reagan bradford,...

CRITICAL STEPS FORCRITICAL STEPS FOR RESPONDING TO GOVERNMENT INVESTIGATIONSINVESTIGATIONSREAGAN E. BRADFORD, DEPUTY GENERALCOUNSELCHESAPEAKE ENERGY CORPORATIONCHESAPEAKE ENERGY CORPORATION

“That kind of thing happens to other companies, not mine.”ot e co pa es, ot e

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TREND: Increasing Enforcement Activity with Growing Price Tags

Record Settlements

JPMorgan - $13 billion

J&J - $2.2 billion$

Deutsche Bank - $1.9 billion

SAC Capital $1 8 billionSAC Capital - $1.8 billion

Total S.A. - $398 million

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Be Prepared

Knowing the risks what exactly“Knowing the risks, what exactly does ‘prepared’ mean?”

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BEFORE THE INVESTIGATION BEGINS

1 2Federal Sentencing Guidelines (1987)1

31 2

The Seaboard Report (2001)23

A Resource Guide to the U.S. Foreign Corrupt Practices Act 3

Effective Compliance and Ethics Program

(2012)3

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“CULTURE OF COMPLIANCE”

• Establish standards and procedures C-SUITE

• High-level personnel ownership

• Effective training

• Monitor and audit effectiveness

• Risk assessments Tone from the Top

• Anonymous reporting

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GET IT RIGHT FROM THE START

Obstruction of justice / witness tampering1

Regulatory complications2

Prejudice defense / negotiation position33

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YOU GOT SERVED

INVESTIGATIVE TOOLS

• Search WarrantsSearch Warrants

• Subpoenas and Civil Investigative Demands

• Requests for Interviews

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IDENTIFY YOUR TEAM AND NOTIFY THEM

• In-house counselLegal • External counsel

• Independent counsel?

Media • Internal communications personnelE t l lt tMedia • External consultants

Government Response TeamGovernment Response Team

STEP #1 FOR LEGAL: ISSUE A LEGAL HOLD

Legal Hold Ground Rules

• Suspend routine document retention/destruction policies

• Issue a litigation hold

• Identify “key players”

• Identify relevant information, collect it and produce it

• Know your systemsy y

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SAFEGUARDING PRIVILEGE

Joint DefenseJoint Defense agreements

Waiver requestsAttorney-ClientWork-Product Waiver requestsWork ProductSelf-Evaluation

Outside auditors

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EMAIL TRAINING

Watch E mail ChainsWatch E-mail Chains

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D&O COVERAGE

Review all obligations:Review all obligations: contractual, statutory and strategic

Assess coverage availability and notifyIndemnity availability and notify carriers

Indemnity

Track everything

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ACCRUAL AND DISCLOSURE

ASC 450-20

Disclosure

Continually reevaluate

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INVESTIGATIVE TOOLS

Search Warrants1

Subpoenas and Civil Investigative Demands2

Requests for Interviews33

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SEARCH WARRANT

Intrusive and Disruptive

• Train• Train• Do not interfere,

but minimizebut minimize disruption

• Track and• Track and document

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SUBPOENAS AND CIVIL INVESTIGATIVE DEMANDS

C t t t• Contact prosecutor / regulator

• Manage document preservation and pcollection

• Balance• Balance cooperation, scope and costand cost

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REQUESTS FOR INTERVIEWS

Surprise! Let’s talk.

• Train• Written

memomemo• 5th

Amendment

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QUESTIONS

CREDITS

Abbe David :Lowell and Obiamaka P. Madubuko, Knock, Knock. Who’s There? The Government. ABA Section of Litigation and Criminal Justice Section gAnnual CLE Conference, April 13-15, 2011

804 H t R d t G t804: How to Respond to a Government Investigation/Inquiry: The First 30 Days, Association of Corporate Counsel

Taylor Phillips, Responding to Government Investigations: Pitfalls and Procedures, Tennessee Bar Journal 20122012