ACC, US Chamber Protest Whistleblower Privilege Decision

ACC, US Chamber Protest Whistleblower Privilege Decision

Raising concerns about the protection of attorney-client privilege, the Association of Corporate Counsel, the U.S. Chamber of Commerce and other business groups this week challenged a federal trial judge’s ruling that ordered contractor Kellogg Brown & Root Services Inc. to hand over documents to lawyers for a whistleblower.

In a 28-page amicus curiae brief [PDF] filed with the U.S. Court of Appeals for the District of Columbia Circuit on Wednesday, lawyers for the organizations wrote that U.S. District Judge James Gwin erred when he ruled March 6 that KBR must produce 89 documents for lawyers who are representing whistleblower Harry Barko. He is suing the company for alleged violations of the False Claims Act.

KBR’s lawyers on March 12 appealed the order to the D.C. Circuit, which stayed the ruling. They have said the paperwork, which concerns an internal company investigation, didn’t come out of a “routine business audit devoid of privilege or work production protection” [PDF]. The lawyers include Vinson & Elkins partner Craig Margolis and Washington, D.C., solo practitioner John Faust.

Lawyers for ACC and the Chamber, as well as the National Association of Manufacturers, Coalition for Government Procurement and the American Forest & Paper Association, wrote that the ruling is an “unprecedented decision [that] threatens to work a sea change in the well-settled rules governing internal corporate investigations.” Elisebeth Cook, a Washington, D.C.-based Wilmer Cutler Pickering Hale and Dorr counsel, is the counsel of record for the business groups.

“Amici’s members depend on in-house attorneys, many of whom are members of amicus curiae Association of Corporate Counsel, to oversee internal investigations needed to ensure compliance with various legal obligations,” the lawyers wrote in their brief. “Amici are concerned that the District Court’s ruling will erode the attorney-client privilege and negatively affect how their members conduct internal compliance programs.”

Gwin wrote in his order [PDF] that KBR didn’t conduct its investigation for the purpose of obtaining legal advice, leaving it without protection afforded by the attorney-client privilege.

“The Court finds that KBR fails to carry its burden to demonstrate that the attorney-client privilege applies to the [investigation] documents,” he wrote.

Lawyers for the whistleblower have said that the involvement of in-house counsel in an internal investigation doesn’t make documents related to the probe privileged. The lawyers include David Colapinto and Michael Kohn of Kohn, Kohn & Colapinto in Washington.

“Notably, an attorney performing investigative, compliance or corporate management functions is performing a business, not a legal function,” the lawyers wrote in a court filing [PDF].

See also: “Inadmissible: Judiciary Hiring Public Defenders Again,” The National Law Journal, March 17, 2014.

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