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TRANSCRIPT
PRESENTED BY:
Earl (Chip) Jones, Littler Mendelson, P.C.
Kevin O'Neill, Littler Mendelson, P.C.
Gretchen Winter, College of Business, University of Illinois at Urbana-Champaign
Conducting Lawful and Effective Global Investigations
Tuesday, September 24
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Conducting Lawful and EffectiveGlobal Investigations
Gretchen A. WinterExecutive Director
Center for Professional Responsibility in Business and Society, University of Illinois, Urbana-Champaign
Earl “Chip” Jones Shareholder
Littler Mendelson, Dallas, TX
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Kevin O’NeillPrincipal
Littler Learning Group, San Francisco, CA
Trent SuttonAssociate
Littler Mendelson, Rochester, NY
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• What has changed?
• What are the dangers?
• What are the opportunities?
Investigations Under the Microscope
• Helps with mitigation with government agencies
• Reduces civil litigation/damages
• Increases morale
• Helps to keep complaints internal
• Helps to create a culture where employees feel comfortable bringing complaints forward
• Keeps you out of the press
Effective Investigations – The ROI
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Well Known Examples
Investigations Gone Bad
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• Recent laws
• Mitigation
• Data Privacy Issues
• Attorney - Client Privilege Issues
• Global Differences
The Increasing Importance of Employment Investigations
When Conducting an Investigation,Is There Really Any Choice?
• It’s a small market, located far, far away – “Nobody will ever find out”: Its so awful why should we dig? We don’t want any PR on this?
• Revised U.S. Sentencing Guidelines
– Once criminal conduct has been detected, the company shall take certain “reasonable steps” to respond appropriately to such criminal conduct
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Attorney Client Privilege Issues –the U.S. and Abroad
EU Data Privacy Issues
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The Ethical Supply Chain
Electronic Searches
• Emails
• Text messages: Quon case
• Online searches
• Facebook, other social media
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• Dodd-Frank
• Sarbanes-Oxley
• Fraud Enforcement & Recovery Act
• Revised False Claims Act
• American Recovery & Reinvestment Act 2009
• Consumer Product Safety Act
Whistleblower Legislative Expansion
• Beware the risks of acting too quickly:
– Renault pre-judged three key employees accused of bribery; embarrassment ensued!
– Investigations must be effective and fair
– Balance
Effective—and Fair—Investigations
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Effective Investigations and Monitoring– FSG 5
The organization shall take reasonable steps to ensure the organization compliance and ethics program is followed, including monitoring and auditing to detect criminal conduct
Question: How Many of You Have A Written Investigation Protocol?
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• Thinking most complaints go to the hotline—they don’t
• Not training managers
• That there needs to be a formal complaint—its all about notice
• Not keeping the complainant anonymous if it comes in that way
• Protection of Whistleblowers and complaints against retaliation
The Triggers—Common Mistakes
Supervisors Receive Majority of 1st Reports
56% Your Supervisor
26% Higher Management
6% Other
5% Hotline/Help Line
5% Other Responsible Person Including Ethics Officer
3% Someone Outside Your Company
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• Confidentiality: What steps can be taken now to best limit the universe of people involved to those who need to know?
• Evidence: Is there any evidence that needs immediate attention or would otherwise be in danger of spoliation?
– Do not destroy evidence
– Do not improperly create evidence
• NOT Properly Escalating the complaint Attorney Client Privilege when needed
Triage—Common Mistakes
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• All investigations must be conducted promptly—TIMING
• Getting the Right team
• NOT Identifying or Gathering the Right or all the Relevant Evidence, Documents
• Not Preserving the Evidence
• Communication Issues
• Technology Issues
• Data Privacy Issues
• Contractual Rights
Planning—Common Mistakes
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• Impartial fact-finder (no biases)
• Good listener
• Gather and collect evidence
• Attention to detail
• Protect the record
• Properly document investigation
• Fairness
• Take off your HR hat
• Take out the emotion
Common mistakes of an Investigator
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• Instructions to witnesses
• Hard questions
• Confidentiality
• Funneling
• Active listening
• Taking OFF HR hat
• Data privacy fright
Pitfalls in the Interviewing
Hotline Complaint
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The Hotline Call
• How to handle?
• Do you need to investigate?
• Should you have a plan?
• Timing issues?
• Who should conduct it?
• Your role as Investigator
Investigation - Four Critical Steps
1) Determine the nature of the allegation.
2) Make a plan 3) Develop the Facts.
Interviews of employees or third parties and review of relevant documents
4) Document the investigation. Sometimes a brief detailed written report.
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Scope of the InvestigationConsider each of the following factors:
• What specific misconduct or actions have been reported or alleged?
• Who is the source of the allegation?
• Does the allegation seem to be a plausible and legitimate concern?
• What are the initial facts?
• Are there any inconsistencies in the initial facts?
• What evidence suggests that the misconduct did not occur”
Scope of the InvestigationConsider each of the following factors:
• Are there any mitigating circumstances?
• How serious does the potential violation appear to be?
• Is the scope broad enough to enable the company to take appropriate remedial action, including determining the extent to which internal processes should be modified?
• Will the investigation findings likely be reported to third parties such as law enforcement or regulators?
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Who Should Investigate?
• Lawyers as Investigators
• Auditors and Accountants
• Corporate Security
• Human Resources Personnel
• Outsourcing the Investigation
Resist the temptation to use any investigator. For best results, match their skills to the type of investigation you are conducting. Experience in human resources or law enforcement does not necessarily make someone an experienced workplace investigator.
Who Owns the InvestigationProcedures – Referrals
• Allegations that are potentially significant to the corporation – such as FCPA type allegations – should always be referred to your Law Department
– Knowing or willful violation of a state, federal or foreign criminal statute for benefit of the Company
– Submission of false or fraudulent statements or claims to a government agency
– Intentional or systematic failure to adhere to internal financial or other compliance related controls
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Who Should Conduct the Investigation?
• In-house Counsel, Outside Counsel? – What are internal resources within and outside Law Department?
– What are the potential implications? (Legal, Regulatory?)
– If ultimate disclosure to government anticipated, cuts in favor of retaining outside counsel
– The more the Company is at risk, the more important the independence of OC
– Ascertain privilege protection in foreign jurisdiction
• Certain foreign jurisdictions, including EU, don’t protect communications between in-house counsel and client
• Other foreign jurisdictions analyze role of in-house counsel
The Plan
• An investigation plan does not have to be formal, but set the scope properly so you will have the right parameters to guide you.
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A Good Investigation Plan Consists of:
• The order in which witnesses should be interviewed.
• What specific issues are to be covered with each witness?
• What documents will be needed to conduct the investigation and complete the investigation file?
• What documents will be shown to each witness, and which documents will be sought from each witness?
• Which senior managers will receive the reported findings, and to whom will the investigative team report?
Conducting a Legal Investigation –Investigation Plan
• Who is covered by privilege?
– Deputizing memo to everyone providing support to Law Department. Memo should instruct to
• Mark documents and emails as privileged
• Only generate work product at direction of Law Department
• Set forth protocol for producing/handling draft summaries and reports
• Maintain confidentiality
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Investigation Plan
• Communication– Must be restricted to those covered by privilege– Beware of manner in which you respond to requests of
government regulators– Originating organization may not be the client and
should not be given substantive updates– Corrective action and/discipline typically not covered;
only communicate facts necessary for those functions to be carried out
Timing of the Investigation
• Investigations vary in complexity and the length of time to complete.
• All investigations must be conducted PROMPTLY.
• Promptness may be a mitigating factor in almost every level if government enforcement, and delay or indifference can be seen as an aggravating factor.
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Your Role as an Investigator
• Impartial Fact-Finder (No Biases)
• Good Listener
• Appropriate Investigation
• Attention to Detail
• Reach Reasonable and Factual Findings
• Properly Document Investigation
• Fairness
• Take off your Compliance hat
• Own it
Conducting the Investigation
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Crucial Step -- Planning
Identify The
Allegations
Laws andPolicies
The SpecificIssues
Select The Means
Interviews
Documents
Other
Then...
Investigation Plan
• Communication– Must be restricted to those covered by privilege– Beware of manner in which you respond to requests of
government regulators– Originating organization may not be the client and
should not be given substantive updates– Corrective action and/discipline typically not covered;
only communicate facts necessary for those functions to be carried out
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The Interview
• On a case by case basis, discuss why interviews or other data should be kept confidential
– The complaint will be handled confidentially, except:
• The needs of the employer or the law may require that information be disclosed on a need-to-know basis
• Be aware of the new NLRB cases
Planning for Confidentiality
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Proper Interviewing Techniques
• Interviews
– Interview target/subject after gathered sufficient facts (some exceptions)
– Upjohn warnings
– Get the story
– Active listening
– Don’t give legal advice
– Funneling
Funnel Approach(The Pyramid)
Open Phase
Clarification Phase
Pinning Down Phase
(i.e. closing the door)
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1. Open Phase
– Open-ended questions
– Objective
– Aim to learn all relevant evidence the witness has
– Encourage the witness to talk
Open Phase
Clarification Phase
Pinning Down Phase
(i.e. closing the door)
1. Open Phase
– What? ?
– Who ?
– Where?
– When ?
– Why?
– Explain?
– Describe?
– Give me a list
Open Phase
Clarification Phase
Pinning Down Phase
(i.e. closing the door)
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1. Open Phase
– Is the mouth of the funnel open?
– Do you remember anything else?
– Careful and patient exhaustion can provoke recollection of additional facts
– Determine the scope before the depth is probed
Open Phase
Clarification Phase
Pinning Down Phase
(i.e. closing the door)
2. Clarification Phase
– Now get clarification for details
• Who?
• What?
• Where?
• Why?
• Tell me in detailOpen Phase
Clarification Phase
Pinning Down Phase
(i.e. closing the door)
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3. Closing Off
– Close the door
– Get the final answer
• Anyone else present?
• Anyone else know about the details?
– Listen to the witness
– Exhaust the subject
– Recap and ask, “Is there anything else?”
Active Listening
– Listen to the witness
– Don’t be wedded to your outline
– Hearing is different than listening
– Don’t miss obvious or subtle cues
– Take accurate notes
– Power of Silence
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Preliminary Disclosures
• Who you are
• Purpose of the meeting
• Confidentiality
• Retaliation
Confidentiality: The Balance
ConfidentialityFair Opportunity
To Respond
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The Final Report
The Final Report
• Before preparation of formal written report, there should be a discussion among investigation team of findings, conclusions and recommendations, at the direction of overseeing attorney
*****Limit informal email communications about results of investigation - don’t argue via Email about results or findings
• If no disclosure or potential disclosure obligations, less concern about full blown report; same with clearly unsubstantiated allegations– External Investigations– Retaliation claims– Qui tam actions
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• Legal Conclusions
• Keeping or not keeping notes
• Written recommendations
• Throwing out reports
• File systems
• Personal opinions
• Excited utterances (notes in margins)
• Any conclusions, just facts
• Others Conclusory allegations as findings
Common Mistakes—Report Writing
Your Investigation File
• Correspondence.
• The investigation plan.
• Interview memoranda.
• Copies of relevant fact-related documents.
• What else?
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The Final Report
• If your investigation is part of a business process, the final report is your finished product.
• It is the sum total of your efforts and proof-positive that an investigation was conducted.
• A well-written report shows that you have done your job and that you recognize your responsibilities to the company.
Report Writing Map
1. Background
– Reporter (if not anonymous)
– Alleged Perpetrator
– Date of Report /Action
– Nature of Report
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Report Writing Map
2. Other Background
– Employment History/ business unit background
– Relationships
– Work Group Setting
Report Writing Map
3. Nature of Investigation
– Date
– Time Spent
– Witness Interviewed
– Documents Reviewed
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Report Writing Map
4.Reporter’s Allegations
Report Writing Map
5. Alleged Perpetrator’s Response
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Report Writing Map
6. Witness Information and Documents Used
Report Writing Map
7. Findings
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Report Writing Map
8. Reasoning
• State facts, not conclusions of law
• Write clearly so it is easily understood and hard to misconstrue
• No recommendations
Documentation
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• Not following up
• Not taking appropriate remedial measures
Common Mistakes—Remediation
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• NOT Following your policies
• NOT Holding employees accountable
• NOT Following up with witnesses as appropriate
• NOT Following up with complainant and keep them informed of status
Common Mistakes—Final Steps
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• Retaliation against whistleblowers or witnesses opens you up to additional legal risk and erodes the needed culture of compliance that encourages internal reporting
Retaliation
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