“The business of the advocate, simply stated, is to win if possible without violating the law.” Marvin E. Frankel, “The Search for Truth: An Umpireal View,” 123 U. Pa. L. Rev. 1031, 1037 (1975). As recently experienced by a pharmaceutical associate general counsel, the line between fair advocacy and criminality is not a settled matter and can be clouded in the eyes of the beholder. The result of this collision can be disastrous. The U.S. Justice Department’s recent failed prosecution of Lauren Stevens, associate general counsel at GlaxoSmithKline (GSK), in United States v. Lauren Stevens, Case No. 8:10-cr-00694-RWT (May 2011), is illustrative. The government’s prosecution arose due to Stevens’s alleged failure to provide complete answers in response to an informal and voluntary request for information during an investigation being conducted by the Food and Drug Administration (FDA). While corporate in-house lawyers across the country were sure to breathe a collective sigh of relief at news of the acquittal of Stevens by District Judge Roger Titus of the United States District Court for the District of Maryland, who pulled the case away from the jury in order to dismiss it, inquisitive minds also wondered how the prosecution got as far as it did and what, if anything, can be learned from Stevens’s ordeal.
A Too Slim Response to the FDA’s Request
Stevens’s story begins on October 9, 2002, when GSK received a letter from the FDA seeking information regarding the possible off-label promotion by GSK of GSK’s well-known product, Wellbutrin. Wellbutrin was FDA-approved as an anti-depressant, but it was also believed to have weight loss potential and had that off-label use. Under current law, the affirmative marketing of a drug by a drug manufacturer for any use not approved by the FDA exposes that manufacturer to civil and criminal liability. However, physicians are free to prescribe the drug for an unapproved use so long as that prescription is issued for a legitimate medical purpose by a practitioner acting in the usual course of professional practice. The FDA requested that GSK provide copies of all marketing materials, in any form, used by GSK to promote Wellbutrin, for any and all uses. Lauren Stevens, GSK’s associate general counsel, was assigned the primary task of gathering the information and responding to the FDA letter. Stevens enlisted two GSK in-house attorneys, both of whom had previously worked for the FDA, to assist her in responding to the letter. Stevens also consulted with an outside legal team, led by a former FDA associate chief counsel, to advise in responding to the FDA’s inquiry.
On October 25, 2002, Stevens participated in a telephone conference with the FDA, concerning the breadth of the FDA’s request, wherein she agreed that GSK would make a good-faith effort to obtain materials from outside doctors under contract with GSK, including physician speakers at GSK-sponsored promotional events. Stevens confirmed GSK’s agreement in a letter to the FDA with the caveat that GSK would need to obtain consent of the owners of the additional material before GSK could properly include such materials in its response. Stevens agreed to advise the FDA if GSK was unable to secure such outside approval.
In December 2002, Stevens sent a letter to some 550 speakers who had given promotional talks on behalf of GSK. Several physicians responded with information indicating that they had promoted Wellbutrin for unapproved uses, including weight loss, at GSK-sponsored events.
Stevens sought legal advice from other GSK counsel as well as outside counsel as to whether these additional materials should be turned over to the FDA as part of GSK’s response. This request for advice culminated in a legal memorandum setting forth the pros and cons of turning over the materials. On the con side, GSK’s legal team determined that voluntarily turning over the materials would provide “incriminating” evidence against GSK. On the pro side, it was recognized that turning over the information would “potentially garner credibility” with the FDA.
Stevens proceeded to respond to the FDA inquiry without disclosing any evidence of such off-label promotion. Upon learning that another GSK employee had turned over some instances of such off-label promotion by physicians, Stevens wrote to the FDA, characterizing these instances as “isolated deficiencies,” and stated that “the objective evidence clearly demonstrates” that GSK “has not developed, maintained, or encouraged” such off-label promotional use.
In November 2010, following a lengthy criminal investigation that included a court order disclosing much of GSK’s attorney-client communications between Stevens and other counsel with whom she consulted, Stevens was indicted by a federal grand jury on several felony obstruction charges, including obstruction of a proceeding in violation of 18 U.S.C. § 1512, falsification and concealment of documents in violation of 18 U.S.C. § 1519, and making false statements in violation of 18 U.S.C. § 1001.
Dismissal of the Indictment
One month before trial was to commence, Judge Titus displayed his first hints of doubt regarding this prosecution when he threw out the indictment, without prejudice, based on the government’s errant response to a grand juror question regarding the applicability of the “advice of counsel” defense. During a colloquy between the prosecutor and the grand jury, a standard feature of grand jury proceedings, one juror asked, “Does it matter that maybe she was—that Lauren Stevens was getting direction from somebody else about how to handle this? Does it matter or is it not relevant?” Judge Titus was troubled by the prosecutor’s response, which conveyed that the “advice of counsel” defense may only be raised by the defendant after she had been charged and that it was therefore not a proper factor for the grand jury to consider in deciding whether or not there was probable cause to indict.
As explained below, Judge Titus disagreed, holding that good-faith reliance on the “advice of counsel” negates the wrongful intent required to commit each of the charged offenses and therefore is a fully appropriate factor for the grand jury to consider in deciding whether there was probable cause to believe an offense had been committed. Judge Titus concluded that a proper response to the juror’s question would have been that if Stevens relied in good faith on the advice of counsel, after fully disclosing to counsel all relevant facts, then she would lack the wrongful intent required to violate the law and could not be indicted for the crimes alleged. Because the grand jury had been materially misled, the court ruled that dismissal was appropriate. However, because it had not been shown that the prosecutor’s erroneous explanation was willful or intentional, the dismissal was without prejudice.
The Government Returns
Not to be deterred, the government returned to the grand jury forthwith and obtained a new indictment of Stevens on all of the same charges. Trial commenced in May 2011. Following the presentation of evidence by the government, Judge Titus dealt his final blow to the prosecution by granting Stevens a Rule 29 motion to acquit on all charges. As explained below, Judge Titus’s ruling was based primarily on the finding and conclusion that Stevens’s actions amounted to zealous advocacy, consistent with the advice of inside and outside counsel, and that no crime had been committed.
Would Your Outside Counsel Do This for You?
Before turning to Judge Titus’s order, it is worth highlighting the declaration filed by Stevens’s trial counsel during pretrial proceedings summarizing the participation by other counsel, including outside counsel, in preparing the response to the FDA. According to the declaration, outside counsel prepared all of the first drafts of the letters Stevens submitted to the FDA containing the allegedly false statements, and outside counsel reviewed and approved multiple drafts of those letters. Outside counsel and GSK jointly took the position that while there may have been rogue physicians promoting the unapproved use of Wellbutrin, such was not the corporate policy of GSK, and it was not encouraged, promoted, or directed by GSK; therefore, GSK’s answers and responses to the FDA were accurate. According to the declaration, it was part of a joint plan and intention by GSK and outside counsel to present the withheld materials to the FDA at a follow-up meeting with the FDA in 2003, but GSK’s calls to the FDA to schedule the meeting were never responded to; accordingly, this meeting never took place.
One Judge’s Crime Is Another’s Bona Fide Legal Representation
Judge Titus began his ruling on the Rule 29 motion by questioning the wisdom of the United States magistrate judge who earlier ruled that a significant amount of GSK’s attorney-client privileged documents had to be produced to the government in the underlying investigation on the basis that the documents were discoverable under the crime-fraud exception. The crime-fraud exception abrogates the privilege against disclosure typically accorded communications between attorney and client where, as noted by Judge Titus, “the evidence establishes that the client intended to perpetrate a crime or fraud and the communications at issue between the attorney and the client were made in furtherance of such crime or fraud.” Judge Titus referred to this ruling by the magistrate judge as “an unfortunate one.” Judge Titus specifically rejected the notion that Stevens was planning a criminal scheme when she sought the advice of counsel. To the contrary, Judge Titus found that a review of all of the privileged documents produced by GSK showed “a studied, thoughtful analysis of an extremely broad request from the Food and Drug Administration and an enormous effort to assemble information and respond on behalf of the client.” In addition, Judge Titus concluded while Stevens’s responses “may not have been perfect” and “may not have satisfied the FDA,” they were communicated to the FDA “in the course of her bona fide legal representation of a client and in good faith reliance on both external and internal lawyers for GlaxoSmithKline.”
Judge Titus ruled that the “safe-harbor” provision of the Sarbanes-Oxley Act set forth in Title 18 United States Code, Section 1515(c) compelled the acquittal of Stevens as to those counts charged under Title 18 United States Code Section 1512 ( the “obstruction of proceedings” counts). The “safe-harbor” provision provides that defense counsel may not be punished under section 1512 for the “provision of lawful, bona fide legal representation services.”
Further, Judge Titus concluded that Stevens was entitled to acquittal on all of the remaining counts as well, because the evidence could only support one conclusion, which was that Stevens acted in good faith and on the advice of counsel to whom she had disclosed all relevant information; therefore, her lack of wrongful intent negated all remaining counts. Accordingly, the court acquitted Stevens on all remaining counts of the indictment.
Given that the Rule 29 judgment of acquittal was granted following the close of the government’s case, double jeopardy barred further prosecution of Stevens. Lest the legal public think Judge Titus acted precipitously, or was a “quick draw,” Judge Titus pointed out that in all his years on the bench, and after denying numerous Rule 29 motions to date, here the granting of such motion was unavoidable.
In granting the Rule 29 motion, Judge Titus made the following comment:
[L]awyers do not get a free pass to commit crimes, . . . a lawyer should never fear prosecution because of advice that he or she has given to a client who consults him or her, and a client should never fear that its confidences will be divulged unless its purpose in consulting the lawyer was for the purpose of committing a crime or a fraud.
Summing up, Judge Titus told the lawyers arguing the case before him: “Not everybody can win the case. One person has to win or one person has to lose this. In this case, I conclude that justice wins by acquitting this lawyer of the charges brought against her.” Judge Titus clearly took a very dim view of the government’s prosecution of Stevens. Having first concluded that the grand jury proceedings were tainted by the prosecutor’s erroneous legal explanation, only to be met with a new indictment, Judge Titus took the exceptional step of ending the government’s prosecution, with prejudice, by granting a judgment of acquittal on the basis that the evidence presented, construed in the government’s favor, was insufficient to sustain a conviction. Double jeopardy bars any further prosecution.
In a situation like this, there are no winners. Certainly, the government does not benefit when a judge dismisses its case. It is a costly embarrassment. And one can hardly characterize an individual who has been twice indicted, made to endure the arduous and angst-filled toll of a federal criminal trial, and who is victorious whether by the judge’s or jury’s hand, as a winner in any meaningful sense.
So what is the lesson? If there is a lesson to be learned, it is that we care greatly about our adversarial system of justice, and in the same sense that we are more interested in letting the guilty go free to protect the innocent, we are more interested in coming down hard on the side of allowing a lawyer wide berth in exercising his or her loyalties and responsibilities on behalf of a client, lest the lawyer become the shill and proxy of the government. And when the lawyer becomes the shill of the government, guess what? We all lose. Because we have lost a very important part of our system, and its protections are for us all. When lawyers are intimidated or afraid to act zealously to protect the interests of their clients for fear that they may be charged criminally for their actions, we all lose.
The situation in which Stevens found herself was not an easy one. GSK had received a voluntary request for information, rather than a subpoena, and all counsel—inside and outside—truly wondered whether the additional information should be produced, given GSK’s argument that these were unapproved practices of physicians and given that counsel owed an obligation to advocate and protect the interests of her client. As is the case with many areas of law, there is room for disagreement. However, rather than regard this as a good-faith and principled disagreement among legal practitioners as to whether the better practice was for GSK to produce the disputed material, the government chose to forgo a more tempered response and, instead, opted to “swing for the fences” by charging the associate general counsel with several felony counts of obstruction of justice and related offenses. When it did, all were ill-served.
The GSK case stands as a tribute to the principle and a reminder to us all that the role of counsel to act zealously for the protection of his or her client must be protected and should be sacrosanct. And if it means that, on occasion, an in-house lawyer may receive even bad advice, and a government’s investigation may thereby be hindered or even thwarted, this may be a negative in the context of the particular investigation, but to prosecute the lawyer for honoring his or her obligations to a client, even mistakenly, is not the way to resolve the dilemma.
The case also stands as a reminder for counsel not to be reluctant to seek to pierce and unmask the secrecy traditionally afforded grand jury proceedings, where there is a basis to believe that material improprieties may have occurred, such as legal misstatements by government counsel.
Federal Rule of Criminal Procedure 6(e)(3)(E)(ii) expressly provides for such relief upon a showing that grounds may exist to dismiss an indictment based on matters that occurred before the grand jury. Our system of justice is hardly advanced when improper statements of law are made and public citizens, whose sworn duty it is to enforce the law and to decide who shall be indicted, receive faulty information from those entrusted with the sworn duty to provide accurate explanations of law. And whether done willfully or unwittingly by a prosecutor, the result is the same—an individual is improperly indicted. And one ought not be surprised that there may be additional such occurrences that will go undetected, absent the continued scrutiny and appropriate challenge made by diligent defense counsel.
Today, the role of corporate counsel is ever more complex due to the increasing pressures and incentives to cooperate with the government, which cooperation must forever be reconciled with the lawyer’s obligations to protect the interests and confidences of his or her client. This incongruence was illuminated in the months leading up to Stevens’s trial in a speech by Assistant Attorney General Lanny Breuer of the Criminal Division of the Department of Justice to a gathering of corporate counsel.Assistant Attorney General Lanny A. Breuer, Dep’t of Justice, Criminal Division, Address at the Annual Meeting of the Washington Metropolitan Area Corporate Counsel Association (Jan. 26, 2011).
Referring to the then pending Lauren Stevens indictment, Assistant Attorney General Breuer stated, “[T]he way I see it, your only incentive should be to ensure that your organization is conducting business responsibly, in every corner of the globe in which it operates.” Id. This proclamation was coupled with the directive that corporate counsel go forth to detect, deter, and prevent crime within the organization and to lead it down the path of responsibility and compliance. Although laudable, and intermittently achievable, these results are often difficult to achieve and may cause the attorney to come into direct conflict with his or her other sworn responsibilities to his or her client, to his or her mission, and to our adversarial system of justice.
It remains the difficult job of corporate in-house counsel and outside counsel to seek to reconcile these interests. But one thing is for sure: Such counsel should not have to worry about criminal prosecution in the event their good-faith decisions are second-guessed. And that is the message well sent by the court’s decision in Stevens.
This article first appeared in the American Bar Association’s (“ABA”) Criminal Litigation Section Fall 2011 Newsletter.