News Release

KPMG Case Is a Victory Over the Thompson Memo

Washington, DC (June 29, 2006) – Last Monday’s decision in United States v. Stein, was more than a victory for the defendants, who had their company-paid attorneys fees restored to them by a federal judge. It was the first time a federal court had recognized the arrogance and inherent unfairness of the Thompson Memorandum, which is the government’s roadmap for coercing companies facing possible criminal prosecution into settling investigations before indictment.

In a strong rebuke to the U.S. Justice Department, Judge Lewis Kaplan made clear there is a difference of constitutional dimensions between the government's awarding credit for cooperation in the form of providing more information to the government, explaining documents, making witnesses available, etc. -- and awarding credit for things that have no logical relevance to the concept of cooperation, and moreover, involve practices that are antithetical to our adversarial system of justice. All of these concessions are made by companies who, in Judge Kaplan’s words, have “a gun to their head.”

Certainly the advancement of attorneys fees is near the top of that list of practices, but the rationale applies equally well to the waiver of attorney-client privilege, the prohibition on joint defense agreements and information sharing, and the pressure on companies to fire employees who assert their Fifth Amendment rights. The attorney-client privilege is the bedrock of the attorney-client relationship and the ability to mount a defense. Joint defense agreements and information sharing are, as well, and should not be implicated outside of real allegations that they are being used to obstruct justice. The bottom line is, a business can decide for itself when it wants to punish employees and how it defines cooperation; the government has no business defining "cooperation" as "talk or else," and then punishing the company for the ultimate decision. 

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NACDL Communications Department

The National Association of Criminal Defense Lawyers is the preeminent organization advancing the mission of the criminal defense bar to ensure justice and due process for persons accused of crime or wrongdoing. A professional bar association founded in 1958, NACDL's many thousands of direct members in 28 countries – and 90 state, provincial and local affiliate organizations totaling up to 40,000 attorneys – include private criminal defense lawyers, public defenders, military defense counsel, law professors and judges committed to preserving fairness and promoting a rational and humane criminal legal system.