Department of JusticeHypothetical Bad News. You or your company has been served with a civil investigative demand requiring you to produce documents and answer questions from the government. The Department of Justice (DOJ) is investigating you for suspected violations of the False Claims Act, or perhaps for participating in a price-fixing conspiracy in violation of the antitrust laws. The investigation could drag on for years and—if you’re found liable—you may be on the hook for millions of dollars.

Hypothetical Worse News. Government agents have also inspected your premises pursuant to a search warrant, and you learn that associates of yours have been subpoenaed to testify before a grand jury. You are the target—or at least the subject—of a criminal investigation. For a company, a criminal conviction and associated fines could be devastating. For an individual, it could result in the loss of your liberty.

To provide a more concrete example, there have been dozens of administrative and criminal proceedings over the last few years that grew out of a massive public corruption scandal involving the bribing of dozens of Navy officials in exchange for participating in or turning a blind eye to baseless bills from an overseas defense contractor. Many participants have been criminally prosecuted, but the criminal investigation (which remains ongoing) has also coincided with administrative enforcement actions that resulted in the debarment of numerous contractors, permanently preventing them from doing business with the government.

More and more, government officials and agencies bring to bear all of the enforcement tools—civil, criminal, and administrative—in parallel investigations and proceedings to put a stop to unlawful conduct.  If you’re the target of parallel investigations, you and your lawyer will need to be mindful about the different discovery tools available to the government, the risks of compromising your rights in one investigation through your response to another, and the need for a global settlement with the government.

All of that could fill a treatise, so I won’t try to cover it here.  Instead, I’ll cover:

  • A brief overview of the DOJ’s approach to parallel investigations and proceedings (they’re favored).
  • Your chances of halting either a civil or administrative proceeding pending resolution of the criminal case (spoiler alert: not great).
  • The importance of thinking strategically at every stage of your response—not just about the individual request or process you’re responding to—but also about how it affects the other investigations (it’s really important).

Continue Reading A Quick Look at Parallel Proceedings

And no one expects a target letter. The Department of Justice defines a “target” of federal criminal investigation as “a person as to whom the prosecutor or the grand jury has substantial evidence linking him or her to the commission of a crime and who, in the judgment of the prosecutor, is a putative defendant.” Federal prosecutors are encouraged to notify targets of their status and give them a chance to testify before the grand jury when such notification won’t compromise the integrity of the government’s investigation—such as by prompting the target to flee the jurisdiction or destroy evidence. When they’re given, those notifications are known as target letters.

We want our clients to avoid getting those target letters. That starts with great compliance programs and robust internal controls to avoid fraud and other malfeasance. It also takes rigorous and sensitive internal investigations to determine whether there’s a problem. If the government begins its own investigation, potential white collar defendants need careful counsel to avoid enforcement action, which can take the form of civil, criminal, and administrative proceedings, and to achieve the best possible outcome in any enforcement action that does ensue.

Target Letter—published by our Investigations, Compliance & White Collar Team—is a resource for those who are in need of practical information and valuable insights covering a broad range of government investigations and state and federal criminal and civil proceedings. We’ll focus particularly on gathering news and providing analysis of white collar issues related to healthcare, government contracting, technology, money laundering, corruption, and fraud and enforcement developments in the Pacific Northwest.  Because no one expects the Spanish Inquisition . . . .