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Rep. Robert C. Scott

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 3013) to provide appropriate protection to attorney-client privileged communications and attorney work product, as amended.

The Clerk read the title of the bill.

Rep. Robert C. Scott

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks and include extraneous materials on the bill under consideration.

Rep. Robert C. Scott

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I introduced H.R. 3013, the Attorney-Client Privilege Protection Act of 2007 on July 12 of this year. At the time, I was joined by eight original bipartisan cosponsors, including the chairman of the Judiciary Committee, Mr. Conyers; ranking member of the full committee, Mr. Smith; Crime Subcommittee ranking member, Mr. Forbes; and other members, Mr. Coble, Mr. Davis of Alabama, Mr. Lungren, Mr. Feeney and Mr. Roskam. I would like to take a moment to personally thank each of them for their support.

The purpose of H.R. 3013 is fairly simple and straightforward. It is designed to prevent a practice that has regrettably become too common in many of Federal Government's recent investigations into corporate wrongdoing. I am specifically referring to the government's use of what are called ``coercive waivers'' to gain access to privileged communications that otherwise would remain private and protected under the constitutional doctrine of attorney-client privilege.

Coercing waivers of corporate attorney-client privilege has not always been the practice among Federal prosecutors. Formerly, a company could produce evidence of its ``cooperation'' with prosecutors by providing insight into relevant corporate information, as well as by providing general access to the company's workplace and its employees. Unfortunately, since that time, memoranda issued by the Department of Justice suggest that the policy has changed to one which now exposes corporations to an increased risk of prosecution if they claim this constitutionally protected privilege.

One of the first such memoranda was issued in 1999. The Holder memorandum was designed to provide prosecutors with factors to be considered when determining whether to charge a corporation with criminal activity, and specifically allowed prosecutors, in gauging the extent of a corporation's cooperation, to consider the corporation's willingness to waive attorney-client privilege and work-product privilege. This memorandum was superceded in 2003 by the Thompson memorandum. This memorandum contained the same language regarding the waiver of attorney-client privilege and work-product privileges and also addressed the adverse weight that might be given to a corporation's participation in a joint defense agreement with its officers or employees and its agreement to pay legal fees.

Today, the current Department policies relating to corporate attorney-client privilege and work-product privileges are embodied in the McNulty memorandum, issued in December of last year. While this new memorandum does state that the waiver requests should be the exception rather than the rule, it continues to threaten the viability of attorney-client privilege in business organizations by allowing prosecutors to request a waiver of privilege upon the finding of so-called ``legitimate need.''

I fully recognize the Department may face hurdles when undertaking investigations and prosecutions of corporate malfeasance. We look at the victims of Enron's collapse, the nearly 10,000 individuals who lost their jobs and pensions, their plans for their future, and know how vital it is for Federal prosecutors to have the tools necessary to prosecute these crimes and hold accountable wrongdoers who profit at the expense of ordinary working men and women. However, I also believe that facilitating and even encouraging such investigations should not come at the expense of vital constitutionally protected rights.

H.R. 3013 therefore prohibits the demanding of constitutionally protected materials as a necessary condition of receiving favorable consideration in decisions relating to prosecution and sentencing. This bill is supported by diverse groups such as the American Bar Association, the Chamber of Commerce, the American Civil Liberties Union, and the Heritage Foundation. That said, Mr. Speaker, I would like to once again thank the bipartisan members of the committee who have joined me in supporting this measure.

Mr. Speaker, I reserve the balance of my time.

Rep. Robert W. Goodlatte

Mr. Speaker, I yield myself such time as I may consume, and I rise in support of H.R. 3013, the Attorney-Client Privilege Protection Act of 2007. H.R. 3013 bars Federal prosecutors from requiring corporations and individuals to waive their attorney-client privilege as a condition of cooperation or for avoiding criminal charges. H.R. 3013 would not prohibit a corporation from voluntarily waiving the attorney-client privilege.

This bill is designed to remedy overreaching by Federal prosecutors. It protects the attorney-client privilege, which is deeply rooted in our jurisprudence and the legal profession. The attorney-client privilege encourages frank and open communication between clients and their attorneys so that clients can receive effective advice and counsel.

In the corporate context, as we saw in the case of Arthur Andersen, the life of a corporation can turn on a prosecutor's discretionary decision to charge a corporation. That decision can have profound consequences on our economy, the employees and the community; and it should not turn on whether or not a company waives its attorney-client privilege.

Cooperation in the criminal justice system is an important engine of truth. However, prosecutors should not require privileged waivers as a routine matter.

Mr. Speaker, I yield back the balance of my time.

Rep. Robert C. Scott

Mr. Speaker, I enter into the Record a letter from the American Bar Association outlining their support for this legislation.

Mr. Speaker, I would hope that the House would adopt the bill.

Dear Representative: On behalf of the American Bar Association (``ABA'') and its more than 415,000 members, I write to express our strong support for H.R. 3013, the ``Attorney-Client Privilege Protection Act of 2007.'' This bipartisan bill, sponsored by Representatives Bobby Scott, John Conyers, Lamar Smith, Randy Forbes, and eight other Members of Congress from both parties, was approved unanimously by the House Judiciary Committee on August 1 and will be considered by the full House next week under suspension of the rules. We urge you to vote in favor of this important legislation. H.R. 3013 is a comprehensive reform measure designed to roll back a number of harmful federal agency policies that are seriously eroding the attorney-client privilege, the work product doctrine and the constitutional rights of employees. Although all of these federal policies raise concerns, the most problematic is the Department of Justice's policy--set forth in the 2003 ``Thompson Memorandum'' and 2006 ``McNulty Memorandum''--that pressures companies and other organizations to waive their privileges as a condition for receiving cooperation credit, and hence leniency, during investigations. In addition, these federal policies contain separate provisions that violate employees' Sixth Amendment right to counsel and Fifth Amendment right against self- incrimination by pressuring companies to not pay their employees' legal fees during investigations, to fire the employees for not waiving their rights, or to take other punitive actions against them long before any guilt has been established. Despite the serious concerns raised by congressional leaders, former Justice Department officials, and the legal and business communities, the Department of Justice and other federal agencies have refused to reverse or fundamentally change their harmful privilege waiver or employee rights policies. Although the Department reluctantly issued new cooperation guidelines on December 12, 2006 as part of the McNulty Memorandum, the new policy falls far short of what is needed to prevent further erosion of fundamental attorney- client privilege, work product, and employee legal protections. As demonstrated by the report that former Delaware Chief Justice Norman Veasey recently sent to congressional leaders, the McNulty Memorandum has not significantly reduced the incidence of government coerced waiver, and federal prosecutors continue to routinely demand waiver of the privilege during investigations despite the new policy. (The Veasey Report is available at <a href="http://www.abanetorg/poladv/priorities/privilegewaiver/cjveaseyletter.pdf">http://www.abanetorg/poladv/priorities/privilegewaiver/cjveaseyletter.pdf</a>.) As a result, the Department's new policy continues to seriously weaken the confidential attorney-client relationship between companies and their lawyers, which, in turn, impedes the lawyers' ability to conduct thorough internal investigations and effectively counsel compliance with the law. This harms companies, employees and the investing public as well. In addition, while the McNulty Memorandum bars prosecutors from requiring companies to not pay their employees' legal fees in some cases, it continues to allow the practice in many instances. The new Department policy and other similar federal policies also continue to deny cooperation credit to companies that assist employees with their legal defenses or decline to fire them for exercising their Fifth Amendment rights. By forcing companies to punish employees long before any guilt has been shown, these federal policies weaken the constitutional presumption of innocence and undermine principles of sound corporate governance. H.R. 3013 would reverse these harmful policies by prohibiting federal agencies from pressuring companies or other organizations to waive their privileges or take certain unfair punitive actions against their employees as conditions for receiving cooperation credit during investigations. At the same time, however, the bill specifically preserves the ability of prosecutors and other federal officials to obtain the important, non-privileged factual material they need to punish wrongdoers and enforce the law. In our view, H.R. 3013 would strike the proper balance between effective law enforcement and the preservation of essential attorney-client privilege, work product and employee legal protections, and we urge you to support the bill during next week's floor vote. Thank you for considering the views of the American Bar Association on this subject, which is of such vital importance to our system of justice. If you have any questions regarding the ABA's views or need more information, please ask your staff to contact Larson Frisby of the ABA Governmental Affairs Office at (202) 662-1098. Sincerely, William H. Neukom, President.

Mr. Speaker, I yield back the balance of my time.