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Justice Department accused of hypocrisy over 'executive privilege'
Michael Roston
Published: Monday July 16, 2007
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Alberto Gonzales's Justice Department has issued legal opinions in recent weeks seeking to bolster the White House's claims of executive privilege against Congressional investigations. At the same time, a bipartisan group in Congress is fighting what it sees as hostility toward the exercise of attorney-client privilege in federal corporate crime prosecutions.

Advocates of new legislation to preserve attorney-client privilege pointed out the contrast between the Justice Department's positions in these two areas.

"There's a certain level of hypocrisy in terms of being willing to infringe on an organization's or an individual's right to privilege, but still standing very steadfast and adamant on the administration's own attorney-client or executive privilege," said Jesselyn McCurdy, Legislative Counsel in the American Civil Liberties Union's Washington Legislative Office in an interview with RAW STORY.

McCurdy has been helping to spearhead an unusual coalition encouraging Congress to preserve attorney-client privilege in the Justice Department's post-Enron and Worldcom corporate prosecutions.

Guided by the so-called 'Thompson Memorandum,' a document written by former Attorney General John Ashcroft's deputy, federal prosecutors have routinely required corporations to waive their right to attorney-client privilege, or the right to speak confidentiality with counsel on pending legal matters. Critics of the government guidance argue it is used to coerce businesses, which are threatened with economic ruin if they do not appear to be fully cooperating with government prosecutions.

But a Justice Department spokesman, Erik Ablin, challenged the claim.

"Since the McNulty Memo was issued in December 2006, prosecutors nationwide have submitted no waiver requests for attorney-client communications," he wrote in a e-mail to RAW STORY.

Nevertheless, Rep. Bobby Scott (D-VA), a Congressman who chairs the Crime Subcommittee on the House Judiciary Committee, introduced the Attorney-Client Privilege Protection Act of 2007 in the House of Representatives on Thursday night.

"This bill protects corporations and employees – from the executive suites to the mailroom – whose rights the Department of Justice and other federal agencies have violated,” Rep. Scott said in a statement issued Friday afternoon. "Corporate crime should be vigorously investigated and prosecuted but within traditional Constitutional boundaries. When government agencies use tactics that violate Constitutional rights, it is time for Congress to act."

Contrasting 'privileges' in Gonzales' Justice Department

The White House has fiercely defended its 'executive privilege' in the face of Congressional investigations, particularly the probe into the recent firing of 8 US Attorneys. Solicitor General Paul Clement outlined the current administration's position in a memo sent to White House Counsel Fred Fielding at the end of June.

"One of the underlying purposes of the privilege is to promote sound decisionmaking by ensuring that senior Government officials and their advisers speak frankly and candidly during the decisionmaking process," Clement wrote to Fielding, relying on Supreme Court precedents set in the course of Congressional investigations of the Presidency of Richard M. Nixon.

Susan Hackett, the Association of Corporate Counsel's Senior Vice President and General Counsel, agreed that there is a contradiction between the Justice Department's positions on executive privilege for the White House, and their stance on attorney-client privilege in corporate prosecutions.

"We've often joked that if you look at the government's releases on why executive privilege should be maintained, they read like our documents," Hackett explained to RAW STORY in a telephone interview. "They are speaking out of both sides of their mouths. They wish to exercise privilege in their own context, but they are relying on limiting it in their prosecutions."

But the Justice Department's spokesman questioned Hackett's argument in a Friday e-mail.

"Your question contains the premise that DOJ 'routinely encourag[es] waivers of attorney-client privilege,' which is not supported by the facts," wrote Ablin, who serves as Senior Counsel in the Justice Department's Office of Public Affairs.

Post-Enron tactics spark legal controversy

Ablin was defending current federal investigations and prosecutions of corporate fraud and other offenses. After the Enron and Worldcom collapses, Ashcroft no. 2 Larry Thompson issued a memorandum directing US Attorneys and other Justice Department officials to consider a number of factors in deciding whether or not an entire corporation should be charged for what might be the illegal practices of a few rogue employees.

"In determining whether to charge a corporation, that corporation's timely and voluntary disclosure of wrongdoing and its willingness to cooperate with the government's investigation may be relevant factors," Thompson's Jan. 2003 memo read. "In gauging [sic] the extent of the corporation's cooperation, the prosecutor may consider the corporation's willingness to...waive attorney-client and work product protection."

Critics of the memo warned that this practice restricted the rights of individuals within the suspected corporation to speak with an attorney, a guarantee found in the Constitution's Sixth Amendment.

"[W]e’ve conducted inquiries, conducted hearings, and solicited views and are of the judgment that the Thompson memorandum is excessive and that it impinges upon the constitutional right to counsel," said Senator Arlen Specter (R-PA) in a Dec. 2006 press conference. Earlier this year, Specter introduced the Senate version of Scott's bill.

Senator Patrick Leahy (D-VT), the current chairman of the Senate Judiciary Committee, explained why he believed the issue was not only worrisome for large corporations.

"The right to counsel has long been recognized as essential to ensure fairness, justice and equality under the law for all Americans," he said in a September 2006 hearing. "This Administration has taken extraordinary steps to investigate and prosecute the press and to intimidate the press, critics, and attorneys while it has claimed unlimited privileges and secrecy for itself."

The ACLU's McCurdy agreed.

"We're really concerned about the Justice Department routinely asking organizations to waive attorney-client privilege because of the way it affects individual employees and their rights to counsel and against self-incrimination," the ACLU attorney explained. "We're concerned about the broader issue of maintaining and protecting privilege. What's the point of having that right if everything you say to your attorney can go to the government?"

Additionally, a federal judge rebuked the Justice Department for the practice in his ruling on a prosecution brought against the company KPMG.

But the Justice Department insisted that any zealousness caused by the Thompson memorandum's guidelines had been discontinued with the issuing of a follow-up guidance from current Deputy Attorney General Paul McNulty (who recently announced that he will resign from the Justice Department later this summer).

"[M]y policy now makes clear that attorney-client communications should only be sought in rare cases; that is, that legal advice, mental impressions and conclusions and legal determinations by counsel are protected," McNulty said in a December 2006 address. "Before they are requested, the United States Attorney must seek approval directly from me. I must personally approve each waiver request for attorney-client communications."

ACC's Hackett responded that the McNulty memo was "too little too late."

"They still behave as if they have a right to decide when clients can or cannot consult their lawyers for confidential advice," she wrote to RAW STORY. "Those prosecutors who were likely to ask for privilege waivers before are still doing it now, without going up the ladder for permission, according to our members’ feedback."

'Strange bedfellows' cooperate on attorney-client bill

In the current Congress, Democratic and Republican House Members are at odds over the course of the US Attorneys investigation. But Rep. Scott's legislation represents a rare point where Republican and Democratic members of the Judiciary Committee are coming together.

"Prosecutors may be overreaching by routinely demanding that corporations waive their attorney-client privilege as a condition of cooperation and a decision not to indict a company," said Rep. Lamar Smith (R-TX), the top Republican on the House Judiciary Committee. "The bill will bar prosecutors from making such a demand but will not prevent a corporation from voluntarily waiving the privilege."

He was joined by other Republicans in supporting Scott's bill: Ranking Crime Subcommittee Member Rep. J. Randy Forbes (R-VA), Rep. Daniel E. Lungren (R-CA), Rep. Howard Coble (R-NC), Rep. Tom C. Feeney III (R-FL), and Rep. Peter J. Roskam (R-IL).

The ACC's Hackett suggested that the coalition supporting Scott's bill was unusual.

"If you take a look at the coalition, the bedfellows are very strange, there is such a wide and diverse group of people who are worried about the Justice Department's practices," she said. "It's hard to figure out who's against us except for the Justice Department and the Securities and Exchange Commission. But it's getting pretty cold out there for them."

The ACLU's McCurdy also insisted that the bill wouldn't be letting the next Enron off easily when it came in the sights of federal investigators.

"Prosecutors have the tools to investigate corporations now," she argued. "The concern we have about the routine waiver request is that it's really just a way for the Justice Department to take a shortcut when prosecuting cases. They can still collect evidence, but they have to do it in a way that's consistent with the Constitution."