On Dec. 1, Rule 408 of the Federal Rules of Evidence willbe amended to allow “conduct or statements” made duringsettlement negotiations with government regulatorsto be used against a defendant in a subsequent criminalprosecution.[FOOTNOTE 1] The new rule has the potential to significantly changethe manner in which defense counsel interact with regulators when negotiating settlements.

In its current form, Rule 408 provides a level of protection for settlementdiscussions between all civillitigants. In pertinent part, the ruleprohibits the admission of evidencederived from compromise negotiations,offers to compromise and evidence”of conduct or statementsmade in compromise negotiations”in order to prove liability or invalidityof a claim.[FOOTNOTE 2]

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