United States: Key Issues And Best Practices For Corporate Internal Investigations

Last Updated: March 28 2018
Article by Adam P. Schwartz and Erin J. Hoyle

Corporations today face a strict regulatory environment and close scrutiny surrounding corporate activity. Public and private companies face the potential of not only governmental investigations, but also private complaints with significant allegations that attempt to call a corporation's conduct into question. Frequently, corporate scrutiny focuses on compliance issues — whether companies comply with the legal obligations and ethical practices applicable to their businesses. To prevent or mitigate the risks associated with this environment, corporations often appoint outside counsel to conduct an internal investigation of any potential or active compliance issues.

Participating in an internal investigation can be daunting to a young lawyer, who is more familiar with the structured, rule-based arena of litigation than in the unfamiliar tasks of document collection, interview memorandums, Upjohn warnings, and report drafting. There are no easy precedents or treatises to research, and no uniform rules or procedures to follow. Instead, internal investigations offer new legal issues and tasks that a typical young lawyer has yet to encounter. The following tips should assist young lawyers in becoming valuable assets to internal investigations.

Proper Preparation

As with any new assignment, begin by taking time to understand the background of the investigation, including (i) the company; (ii) the allegations prompting the investigation; (iii) the applicable legal framework; (iv) any key individuals identified in the allegations and their roles in the company; (v) the client's expectations; and (vi) the law of attorney-client privilege and work product protection.

Maintaining the attorney-client privilege and work product protection is critically important to the success of an internal investigation. Counsel's legal advice to the client is protected by the attorney-client privilege, and the documents counsel creates in the course of the investigation are protected by work product protection. To protect against an inadvertent waiver, the client and counsel should:

  • Provide Upjohn warnings at all witness interviews and instruct witnesses to keep the discussions confidential.
  • Ensure that any non-attorneys involved in the investigation work at the direction of designated attorneys.
  • Include legends on documents and communications indicating that they are protected by the attorney-client privilege or work product protection where applicable.
  • Avoid disclosing any documents or other information about the investigation to individuals outside of the attorney-client privilege and work product protection. (For example, if the client is the audit committee, sharing documents or other information with the full board may waive privilege.)

An initial review of applicable privileges and protections will ensure proper steps are taken to preserve and protect them.

Document Collection and Review

Document collection and review are critical to reconstructing past events and assisting further fact-finding during witness interviews. Becoming familiar with the allegations, underlying legal framework, and key individuals at-issue will help assess which documents, files, and search terms would make a good starting point for a review. As witnesses are interviewed, pay particular attention for additional locations of potentially responsive documents.

Most importantly, make a record of the review process, including which documents have been collected and reviewed, the location of the documents, what search terms were applied, the number of documents and pages reviewed, and who conducted the review. Develop a comprehensive and efficient system of tagging documents by topic and individual to avoid rereviewing large quantities of documents when assisting with the compilation of witness and topic binders for interview preparations and any interim or final reports.

Witness Interviews

By reviewing documents and potentially attending some client meetings, you will likely know the facts of the investigation better than others involved in it. Partners and senior associates are relying on that knowledge, particularly during witness interviews, to make sure they don't miss key facts or lines of questioning.

Before the interview, clarify with the partner whether and how to raise any issues or topics that arise during the interview. An interviewer may make a conscious decision not to ask a question found on the interview outline. If you are unsure whether a topic was skipped due to a conscious decision or was simply overlooked, ask for a break in the interview so you can discuss the point away from the witness.

At the interview, have the Upjohn warnings handy and ensure they are given to and understood by each witness. With your expertise on the facts of the investigation, correct any factual misstatements by fellow counsel. Should the interviewer ask if they've missed anything, raise any topics that have not been addressed.

Reliable Interview Notetaking

Reliable notetaking is an essential skill for a young lawyer to master. The purpose of notetaking is not to provide a transcript. Instead, be as thorough as possible, without recording every word verbatim. Evaluate the significant substance of the interview, and concentrate on accurately recording the substance.

Verbatim notetaking has serious work product consequences. Interview notes or subsequent summary memorandum may not be considered protected work product if they simply transcribe the interview.

Discuss your partner's preference for taking notes on a laptop versus by hand. Although laptops have their advantages, such as typing speed and ease of converting typed notes into a polished interview memorandum, notetaking by laptop may not be appropriate under all circumstances. Laptops can be distracting during an interview or make witnesses more cautious in their responses. If you do use a laptop, always remember to bring a flash drive or other device to back up your notes after each interview and bring a notepad should technology issues arise.

Concise and Organized Interview Memoranda

Less is more with interview memoranda. Internal investigations often involve many witnesses and an urgency associated with the release of findings. When in need of a quick refresher on a particular interview, no one wants to spend two hours reading a memo to decipher its substance.

An interview memorandum is meant to be a coherent and concise reference point for accessing the substance of the interview. Accordingly, determine whether drafting the memo in bullet-point form with short narratives is the most appropriate format. By removing any unnecessary verbiage that accompanies the typical legal memo, you can significantly decrease the length of the memo without sacrificing substance.

Reporting Findings and Conclusions

At the conclusion of the investigation, a report (either oral or written) of the findings and conclusions is expected. A young lawyer may be tasked with formulating a first draft of any tentative findings that outline the final report. The report should detail the work of counsel, its legal conclusions, and its legal advice.

If the client, such as the audit committee, intends to provide a report of the investigation to another recipient, such as the full board, the client should prepare a report setting out its findings and conclusions, but the client's report should not include a detailed recitation of facts or counsel's legal advice. This allows the client to maintain attorney-client privilege and work product protection.


Conducting an internal investigation can be a complex matter, fraught with pitfalls for the inexperienced practitioner. When a corporation is confronted with evidence or allegations of potential wrongdoing, conducting an effective corporate investigation, protected by the attorneyclient privilege, can mitigate potential risks. A young lawyer can play an important role in such investigations by understanding the intricacies of attorney-client privilege and work product protections, coordinating document collection and reviews; leading preparations for witness interviews; taking reliable interview notes; drafting concise and accurate interview memoranda; formulating tentative findings; and drafting written reports or oral presentation outlines. Overall, thoughtful, proactive preparations will reduce mistakes, ensure important investigatory standards are met, and help evidence the corporation's efforts to identify and resolve any actual or perceived compliance issues.

Originally published in Trial Advocate Lawyer, Winter 2018 (Volume 37, No. 1). ©2018 The Florida Defense Lawyers Association. Reprinted with Permission.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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