Need for individual counsel

When either an organizational party or multiple individual defendants who are involved in civil litigation become aware of a possible criminal investigation into the same conduct then the employees or individuals should consider retaining their own criminal defense lawyer. This is because the criminal investigation may create a conflict between the entity and its employees or even its owners and directors and among individuals. In civil litigation, the plaintiff’s interest usually lies in proving the entity’s liability because the entity has the deep pocket. Thus the entity and its employees share an interest in avoiding liability rather than apportioning blame, especially since under the doctrine of respondeat superior any employee’s wrongdoing fastens liability on the company. However, finger-pointing starts when a criminal investigation looms. Prosecutors will tempt entities with the prospect of avoiding prosecution if the entity helps to prove the guilt of its employees or officers. Unfortunately, obtaining separate lawyers indicates that the employees interests have diverged from those of the company and perhaps from each other’s. This divergence could harm all defendants in their ability to defend both the civil case and the criminal investigation.

Joint defense agreements

One way to maintain unity among the defendants when each has separate counsel is a joint defense agreement. Joint defense agreements do not prohibit their signatories from later turning against each other, but by obligating them to maintain the confidentiality of information learned through the joint defense, the agreement makes later betrayals difficult because the turncoat must prove to the prosecution and the court that the information he offers in his cooperation is not derived from privileged joint defense information. Therefore, parties who have the most to gain from cooperation with prosecutors should avoid joint defense agreements (i.e., less culpable employees; and companies who hope to avoid prosecution by serving up their wayward employees, officers and directors to the prosecution). The more culpable individuals, with the most to lose, generally should embrace joint defense agreements and suggest them early in the process, before the other parties reassess the disadvantages of jointly defending the case.

Advancing criminal lawyer fees

The company or employer should consider advancing attorney fees for employees, even if not required to do so by law or bylaws. Advancing fees demonstrates that the company has not abandoned its employees and has avoided unduly antagonizing them. Furthermore, the company can ensure that its employees have a competent criminal defense lawyer who will fight the case vigorously, and this might help the company demonstrate to prosecutors that there was no wrongdoing on anyone’s part. Finally, while each attorney, no matter who pays him, owes his duties of loyalty and confidentiality to his client, the company’s counsel can coordinate the selection of counsel to insure that the lawyers selected work well together. Agreements to advance fees often are unwritten to avoid government discovery of their terms. Any written agreement should emphasize that the agreement does not require the witness or client to tell anything but the truth.