Read the press about Judge James Gwin’s decision in United States ex rel. Barko v. Halliburton Co., No. 1:05-cv-1276 (D.D.C. Mar. 6, 2014), and you might see it as the beginning of the end for the attorney-client privilege in internal investigations. While the ultimate implications of the decision remain to be seen, that’s not how we see it.

The attorney-client privilege and the work product doctrine are alive and well, as is their application to internal investigations. The FAR clause implementing the requirement for a Code of Business Ethics and Conduct preserves the contractor’s right to conduct an internal investigation subject to the protections of the attorney-client privilege and the work product doctrine. See FAR 52.203-13 (Dec. 2008). The Justice Department’s Principles of Federal Prosecution of Business Organizations explicitly states that a company is not required to waive privilege in order to get credit for cooperating with a government investigation. “[W]aiving the attorney-client and work product protections has never been a prerequisite under the Department’s prosecution guidelines for a corporation to be viewed as cooperative.”

The Senate Committee on Commerce, Science, and Transportation today released its analysis of the 2013 Target Data Breach, using the “intrusion kill chain” framework from Lockheed Martin as its analytical tool.  In short, the analysis shows that although Target likely failed at multiple steps along the chain to stop the breach, the opening salvo by the attackers was waged on a Target vendor, Fazio Mechanical Services.

Although details are not reported, the report does suggest that the attacker may “have sent malware-laden emails to Fazio at least two months before the Target data breach began.”  Target’s supplier portal and facilities management pages were apparently viewable on the Internet, and files from the sites “allowed the attacker to map Target’s internal network prior to the breach.”  Unfortunately, Fazio was also using a free version of an anti-malware product, which did not provide real-time protection and was intended only for individual consumer use.

The line between “white collar crime” and “street crime” is often blurred as prosecutors and investigators deploy all of the tools at their disposal against white collar and regulatory offenses. Principal among these tools is the search warrant. While the execution of a lawfully obtained search warrant cannot be stopped, a company’s reaction to the search and to the agents conducting it can have a significant impact on the course of a government investigation. A well-executed response may yield intelligence about the nature and scope of the investigation and may limit the amount of information the government obtains.

In this post, we present an overview of the search warrant process and offer some basic guidelines that may be used in preparing for and responding to a search warrant.

On March 6, 2014, the District Court for the District of Columbia issued an opinion in United States ex rel. Barko v. Halliburton Company et al. requiring Kellogg, Brown & Root Engineering Corporation (“KBR”) to produce documents originally withheld on the basis of attorney-client privilege and the work product doctrine. The Court found that the documents, which related to internal investigations of possible violations of KBR’s code of conduct, were ordinary business records created to satisfy regulatory requirements and were not created for purposes of obtaining or receiving legal advice. The Court’s decision was based on the fact that KBR’s internal investigation was required under the Federal Acquisition Regulation and internal KBR policy, and that the investigation was conducted by non-lawyers. The Court’s holding raises significant questions about existing corporate compliance and investigation programs in regulated industries, including healthcare.

In Barko, the plaintiff brought a qui tam complaint alleging that KBR employees subcontracted to certain third parties who inflated invoices for substandard work, resulting in overcharges to the government. Barko sought, in the course of discovery, documentation from the internal review performed by KBR’s Office of Business Conduct into these allegations. After an in camera review of the documents at issue, the Court determined that the documents were not protected.

New guidelines from the United States Patent and Trademark Office were issued to address recent changes in the law regarding subject matter eligibility. The guidance applies to all claims “reciting or involving laws of nature/natural principles, natural phenomena, and/or natural products.” There is no change to claims reciting abstract ideas.

This step-by-step analysis of patent…

This article was originally published by the American Health Lawyers Association. Copyright 2014, American Health Lawyers Association, Washington, DC.  Reprint permission granted.

On February 5, CMS issued Change Request 8569 instructing Medicare administrative contractors (MACs) to implement system edits to prevent payment of respite care for more than five days at a time for any hospice claim submitted…

On March 10, 2014, the parties to U.S. ex rel. Baklid-Kunz v. Halifax Hospital Medical Center et al. entered into a Settlement Agreement to the resolve the claims in the United States’ Complaint in Intervention in this matter. Under the terms of the Settlement Agreement, Halifax must pay the settlement amount of $85 million by…

This article was originally published by the American Health Lawyers Association. Copyright 2014, American Health Lawyers Association, Washington, DC.  Reprint permission granted.

Using authority provided by the Affordable Care Act, the Centers for Medicare & Medicaid Services (CMS) imposed new temporary moratoria and extended existing moratoria on the enrollment of home health agencies (HHAs) and …

This morning, March 3, at what was to be the commencement of the jury trial in U.S. ex rel. Baklid-Kunz v. Halifax Hospital Medical Center (Case No: 6:09-cv-1002-Orl-31TBS), the parties informed the Court that they had reached a tentative settlement.  The parties were given until March 10, 2014 for file a Joint Motion to …