The potential for federal obstruction of justice charges levied against companies has increased substantially with two recent decisions by federal Courts of Appeal.
The Sixth Circuit held in United States v. Carson that creating a document containing false information even long before a federal investigation is initiated (i.e., as much as six months prior to the investigation) may trigger obstruction of justice liability if the company reasonably knew or should have known that a federal investigation was possible or likely. The practical implications of this ruling require a company to enhance its internal controls and vigilantly monitor the management of corporate documents, regardless of whether the company believes or knows that a federal investigation may arise, in order to adequately protect against later facing charges that it should have known that an investigation into the underlying subject matter would be initiated.
In United States v. Erickson, the Tenth Circuit held that a company may be charged with obstruction of justice for producing a false document in response to a federal grand jury subpoena even where the document at issue was later shown to be irrelevant to the grand jury's investigation. The ramifications of this decision are significant for businesses—many of which are regularly required to respond to federal grand jury subpoenas due to the regulated nature of their industries—and suggest that companies should carefully examine every document produced to federal authorities to avoid production of false information, even if the document being produced appears to have little or no relevance to the matters under investigation.
- Sixth Circuit Affirms Obstruction Charges for False Statements Made Six Months Prior to Federal Investigation
- Irrelevance Is No Defense to False Documents Submitted to Federal Grand Jury