No End to Aggressive Investigative Techniques

July 7, 2011

By Anne K. Walsh & John R. Fleder

Companies must proactively prepare for the strong arm tactics the government employs to investigate companies regulated by FDA.  A recent case demonstrates that the federal government can act with little regard to companies seeking to represent themselves by defending against such aggressive tactics.   As a result, without certain procedures in place, a company’s employees could disclose otherwise privileged documents, or make statements on behalf of the company without the company’s knowledge. 

In In re Amgen, Inc., No. 10-MC-0249(SLT) (E.D.N.Y. Apr. 6, 2011), Amgen sought a protective order to stop the government from interviewing its current employees without coordinating through Amgen’s legal counsel.  Amgen argued that such communications violated the “no contact” rule of New York’s Code of Professional Responsibility.  The magistrate judge recommended that the court deny Amgen’s motion on the ground that it was non-justiciable, or in the alternative, without merit.  The district court later entered an Order in accordance with that recommendation on June 14, 2011.  

The “no contact” rule provides that a lawyer shall not communicate (or cause another to communicate) about the subject of the representation with a party the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the prior consent of the other lawyer or is authorized to do so by law.  N.Y. Rule of Prof’l Conduct 4.2(a).  This rule applies to all federal government attorneys practicing within the State of New York by virtue of 28 U.S.C. § 530B(a).  Most states have a similar rule of professional conduct preventing lawyers from communicating with represented parties. 

In its report and recommendation, the magistrate judge analyzed application of the rule to the relevant facts of the case.  The report merits review by anyone interested in the nuances of the rule of professional conduct governing these communications.  One interesting highlight is the list of alternative remedies the magistrate judge identifies for Amgen, in lieu of granting the injunctive relief it seeks: 1) seeking professional disciplinary action against the prosecutors before the relevant state bar authorities; 2) seeking disciplinary action before the court’s Committee on Grievances; 3) seeking internal disciplinary action by the U.S. Department of Justice for violating its policies; and 4) seeking to suppress in litigation any evidence resulting from a violation of the “no contact” rule. 

We want to highlight that the federal government makes no apologies in purposefully and systematically directing its agents to interview employees of represented companies.  The result in this case likely will increase the number of interviews conducted in this manner. 

As described in Amgen’s memorandum in support of its motion, for two years the government had coordinated with Amgen’s counsel to interview its current employees.  There appears to have been some discussion between the company and the government about this coordination, but obviously the discussions did not lead to a meeting of the minds.  The coordination ended without notice, and the government conducted interviews of several current employees at their homes.  In at least one of those interviews, government agents sought to obtain documents belonging to Amgen.  According to Amgen, the government “was looking to interview current Amgen employees outside of the presence of counsel and to attempt to obtain statements binding against Amgen about activities that might have occurred exclusively, or at least primarily, in past years.” 

Given the increasing likelihood of “at home” visits to current employees, companies must have procedures for employees to respond to inquiries from federal law enforcement agents.  These procedures should require employees to immediately notify in-house counsel of any contacts made by the federal government.  In addition, employees should be instructed about the confidentiality and potential privileged status of certain documents and information, and the prohibitions on their disclosure outside the company without prior approval.  Employees should be trained about these issues.

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