What To Do With Notes from an Internal Investigation? Court Says Big Firm’s Methods Were “Gamesmanship”

January 5, 2016

shredded evidenceBy: Sara Kropf

When I was a brand-new associate at a big firm, I volunteered to work on an internal investigation into accounting irregularities at a public company. I knew nothing about internal investigations.

Before we started interviewing employees, a partner explained the process: I would take notes and then draft interview memos from my notes. When the memo had been finalized by the partner, I could get rid of my notes. That way, the typed memo was the definitive record of the interview. At the time, there was no government investigation into the company; it was purely an internal inquiry. (This process changed when the government started investigating; at that point, we kept everything.)

In a recent opinion in a criminal case relating to the Bridgegate scandal, a federal judge chastised a big law firm for getting rid of its interview notes from its internal investigation. Ultimately, though, the court did not find that the firm had violated any law or requirement to keep notes of interviews.

What are best practices for handling interview notes in an internal investigation? Are they protected work product? Should you always keep them?

Bridgegate, Abridged

In September 2013, several highway access lanes from Fort Lee, New Jersey to the George Washington Bridge into New York City were suddenly closed. The mayor of Fort Lee had refused to support Governor Chris Christie’s bid for reelection. A political scandal was afoot. (A summary of the case is in my prior post here.)

As usual, it was the foot soldiers who took the blame. The New Jersey USAO started an investigation into what happened, including into the Office of the Governor of New Jersey (“OGNJ”). OGNJ hired Gibson Dunn & Crutcher to conduct an internal investigation.

Ultimately, three individuals were indicted. David Wildstein, former Port Authority director of interstate capital projects, pleaded guilty to conspiracy. William Baroni, the former Deputy Executive Director of the Port Authority of New York and New Jersey, and Bridget Kelly, then the Deputy Chief of Staff for Legislative and Intergovernmental Affairs for the OGNJ, were both charged with wire fraud.

The Subpoena

During its investigation, Gibson Dunn interviewed 70 people, drafted a report that was made public and turned over the interview memos for those 70 people to the government.

On May 27, 2015, Ms. Kelly filed, and Mr. Baroni joined, a Motion for Issuance of a Rule 17(c) Subpoena.

Rule 17(c) subpoenas are funny creatures. Based on the rule’s language, they should be a way for the defense to conduct its own investigation and seek relevant documents to fight the charges. After all, the government has used grand jury subpoenas throughout its investigation to seek documents that may help the government’s case. Why shouldn’t the defendant get the same opportunity? Here’s what the rule says:

(c) Producing Documents and Objects.

(1) In General. A subpoena may order the witness to produce any books, papers, documents, data, or other objects the subpoena designates. The court may direct the witness to produce the designated items in court before trial or before they are to be offered in evidence. When the items arrive, the court may permit the parties and their attorneys to inspect all or part of them.

(2) Quashing or Modifying the Subpoena. On motion made promptly, the court may quash or modify the subpoena if compliance would be unreasonable or oppressive.

(3) Subpoena for Personal or Confidential Information About a Victim. After a complaint, indictment, or information is filed, a subpoena requiring the production of personal or confidential information about a victim may be served on a third party only by court order. Before entering the order and unless there are exceptional circumstances, the court must require giving notice to the victim so that the victim can move to quash or modify the subpoena or otherwise object.

Courts, however, have interpreted Rule 17(c) narrowly, not allowing these subpoenas to be used for a “fishing expedition” or a broad discovery device. The party seeking a Rule 17(c) subpoena

must show: (1) that the documents are evidentiary and relevant; (2) that they are not otherwise procurable reasonably in advance of trial by exercise of due diligence; (3) that the party cannot properly prepare for trial without such production and inspection in advance of trial and that the failure to obtain such inspection may tend unreasonably to delay the trial; and (4) that the application is made in good faith and is not intended as a general ‘fishing expedition.’

United States v. Nixon, 418 U.S. 683, 699-700 (1974).

Despite this tough standard, the court granted Ms. Kelly’s motion. The defendants issued a subpoena to Gibson Dunn that requested:

  1. Any and all handwritten or typed notes, stenographic transcripts and audio and/or video recordings of witness interviews conducted by Gibson Dunn during its representation of the Office of the Governor of New Jersey from on or about January 16, 2014 to the present.

  2. Any and all metadata and the document properties for all typed notes and interview summaries created during interviews of witnesses during Gibson Dunn’s representation of the Office of the Governor of New Jersey from on or about January 16, 2014 to the present.

Gibson Dunn objected and filed a motion to quash the subpoena. In its motion to quash, the firm averred that there were no notes of the investigation to produce and so the subpoena was moot.

Why Didn’t the Firm Have the Notes?

As the motions practice over the subpoena took shape, it became clear why Gibson Dunn did not have any notes of the interviews.

The explanation started in 2013, when a party subpoenaed notes from Gibson Dunn for another internal investigation. In that case, the head of the firm’s white collar group submitted a declaration that the firm’s general practice was to take notes during an investigation and retain the notes. However, in the Bridgegate case, the firm admitted that it had not followed its normal procedure.

Rather, as the court explained:

GDC [Gibson Dunn] acknowledges that it intentionally changed its approach in this investigation. (Dkt. No. 39, October 9, 2015 Letter from [GDC’s] Randy Mastro (noting that GDC was “careful about the manner in which we prepared our interview memoranda and other work product” because of the parallel legislative investigation and media interest).) Pursuant to that new approach, “witness interviews were summarized electronically by one attorney while the interviews were being conducted and then edited electronically into a single, final version.” (Southwell Decl. ¶ 13.) The practical effect of this unorthodox approach was to ensure that contemporaneous notes of the witness interviews and draft summaries would not be preserved. Rather, they would be overwritten during the creation of the revised and edited final summary.

In other words, the lawyer taking notes during the interview did do so electronically in a file. Then, rather than starting a new document to draft the memo, the lawyer simply converted the file containing the notes directly into the memo. As a result, the original version of the notes was overwritten by the memo itself and no longer existed. It appeared to the court that this process was chosen intentionally—it was not the result of a single associate simply doing so on her own.

The court was not happy. It noted that the Gibson Dunn team was packed with five former federal prosecutors and that it appeared that the firm had been paid millions of dollars “at taxpayer’s expense.” The court understood why defendants had “cried foul” at the lack of notes.

This Court shares Defendants’ frustration. Although GDC did not delete or shred documents, the process of overwriting their interview notes and drafts of the summaries had the same effect. This was a clever tactic, but when public investigations are involved, straightforward lawyering is superior to calculated strategy. The taxpayers of the State of New Jersey paid GDC millions of dollars to conduct a transparent and thorough investigation. What they got instead was opacity and gamesmanship. They deserve better.

The court, however, found no reason to doubt the firm’s representations as to what happened to the notes. So, the motion was granted as to the first request under the subpoena.

What about the Request for Metadata?

The defendants had also requested the metadata underlying the memos. They wanted the data to identify which firm’s lawyer had interviewed the witness, for possible impeachment of government witnesses at trial.

But Rule 17(c) doesn’t allow for discovery of possible impeachment material. This is unfortunate, given that undermining government witnesses is one of the most important parts of developing a defense. According to the court, the defendants could get this evidence another way:

If, as Defendants claim, there are discrepancies between what the witnesses said during their interviews and how their statements were memorialized in the GDC summaries, Defendants may call the witnesses and/or the GDC attorneys who conducted the interviews to testify at trial. Rule 17(c), as it relates to a third party, should only be enforced when Defendants cannot obtain the information sought from any other reasonable source. As both the witnesses and GDC attorneys are available to Defendants at trial, Defendants have no need for the summary metadata.

The court quashed the second request in the subpoena as well.

Motion granted. Subpoena quashed. Game over.

So, Should You Keep Your Notes?

The court in this opinion never said that there a legal requirement that the firm keep its notes, but it clearly was not happy that it hadn’t. So, what is a prudent investigator to do?

I would draw the line depending on whether there is a government investigation. If you are investigating a private entity and there is no government investigation—and not one on the horizon—then there is no legal requirement to keep the notes. The investigation is purely internal and is not being conducted to satisfy any public purpose or to be given to a government agency. Keeping the notes in this instance simply serves to create discovery for a possible civil case, and there’s no good reason for that. It would be worthwhile to discuss this procedure with the general counsel to get her sign-off on it, though.

Note that a provision included in the Sarbanes-Oxley Act, known as the “anti-shredding provision,” is worth considering. Codified at 18 U.S.C. § 1519, it reads:

Whoever knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States or any case filed under title 11, or in relation to or contemplation of any such matter or case, shall be fined under this title, imprisoned not more than 20 years, or both.

When there is a government agency involved—say, the SEC or DOJ—then keep the notes. That’s your safest bet. If there is a subpoena issued to your client for documents related to the issue you are investigating, then deleting possible evidence could be obstruction of justice.

If you are incredibly risk averse, or your client is, then keep the notes. Make sure your interview memos are dead-on accurate and carefully drafted. Then even if you have to turn over the notes, there’s no discrepancy between the notes and the memo.

Gibson Dunn’s process was an able and strategic workaround. It is notable that the court did not find any legal requirement to keep notes, even though there was an ongoing investigation. It may have made a difference that the firm did not actively delete the files but rather merely overwrote them.

A few other thoughts about interview memos:

  1. Yes, the notes of your interviews are protected work product, generally speaking. There could be an argument that the notes simply report what the witness is saying and thus is the lesser-protected category of fact work product rather than opinion work product, but that’s not usually the case. An attorney’s notes of an interview often contain thoughts and impressions of the witness—does he or she appear candid? Are there other questions that should be asked of other witnesses? Have other strategy concerns arisen during the interview?
  2. You may be thinking—why not simply record and transcribe the interviews? That’s a bad idea. A transcription is almost certainly discoverable because it is a verbatim recitation of the interview. An interview memorandum contains the thoughts and impressions of the lawyer and thus is arguably work product and protected from discovery.
  3. That said, don’t hesitate to turn your notes into a memo so the information is in a usable form. Simply keeping the notes (perhaps thinking that no one can understand them but you) leaves you open to a few bad outcomes—for example, you or another lawyer on the team may not be able to read your own handwriting later, making it cumbersome or impossible to summarize a witness’ recollection to in-house counsel or to the board.
  4. Have only one person take notes during an interview. That way, there are not two different sets of notes that may record different things.
  5. Start your memo with a statement like this: “This memorandum summarizes the interview of John Doe on December 10, 2015. It is not a verbatim transcript and contains my thoughts and mental impressions of the interview.” It should also document that the required Upjohn warnings were given. For example, the memo should say something like “We informed Mr. Doe that we were retained to conduct an investigation, that the information obtained during the interview is privileged, that we do not represent the witness personally and that the company alone will decide whether to waive the privilege.”

Published by Kropf Moseley

Whether you need to take a case to trial, negotiate a resolution without ever setting foot in the courtroom, or navigate a complex public relations problem, we can help. View all posts by Kropf Moseley.