Investigations Practices Pivot Amid 'Cascade' of Misconduct Claims
Law firms that can combine strong traditional investigations practices with #MeToo-era savvy are especially in demand.
August 20, 2018 at 01:14 PM
9 minute read
The original version of this story was published on The American Lawyer
As the #MeToo movement continues to fuel an explosion of harassment and abuse allegations against powerful men, companies and institutions caught up in the claims are adopting a familiar playbook.
Step 1? Panic. Step 2: Hire a law firm to conduct an internal investigation.
CBS announced its investigation earlier this month, after sexual harassment allegations surfaced against CEO Leslie Moonves. Wynn Casinos launched one to probe the conduct of former CEO Steve Wynn. Schools, universities and state legislatures have turned to the tool after reports of inappropriate behavior by elected officials.
For law firms with longstanding investigations practices, the climate has brought high-profile engagements for prominent partners and a boost in billable hours. Other firms have launched or branded new practices, capitalizing on their lawyers' existing expertise—and their clients' anxieties.
Of course, sexual misconduct claims aren't new, and neither are these types of investigations. Before revelations about Harvey Weinstein encouraged women to expose patterns of sexual harassment and misconduct, Fox News turned to Paul, Weiss, Rifkind, Wharton & Garrison to investigate accusations against former chairman Roger Ailes and prime-time fixture Bill O'Reilly. And both Perkins Coie and Covington & Burling took on different elements of Uber's purportedly toxic workplace culture.
But even attorneys who have been tuned into workplace misconduct for years say that it is a new era.
“As you got to the fall of last year and the Harvey Weinstein allegations were made public and the cascade of allegations came after that, it just dawned on me that this was a tipping point, of sorts, with respect to issues that I'd worked on for my entire career,” said Ann Marie Painter, chair of Perkins Coie's labor and employment practice.
Her firm is one of several that have formalized their work in the area in the last year, creating a cross-practice group focused on workplace harassment.
“It became clear that we needed a multidisciplinary approach for our clients. It's not just about the employment laws, we're seeing more allegations that involve the potential for criminal liability,” Painter said. “There are now some insurance companies that provide companies employment insurance with coverage for reputational damage. We thought about the fact that boards are becoming much more involved and engaged and sensitized and also under scrutiny.”
The firm saw value in drawing in experts in corporate governance—familiar with the unique challenges facing boards—to complement attorneys most attuned to management issues, along with white-collar pros.
In recent months, Perkins Coie has been handling a probe into allegations of sexual abuse against former Ohio State University athletic doctor Richard Strauss, but Painter and colleague Markus Funk declined to comment on the matter.
The attorneys at the forefront of Ropes & Gray's recently constituted sexual misconduct and workplace harassment initiative have also been on top of the issue. In addition to traditional work probing corporate malfeasance, the firm's internal investigations attorneys have a history of managing major matters related to child sex abuse. Between 2014 and 2015, the firm handled an independent investigation into a sexual abuse scandal at the American School of Japan. And labor and employment attorneys had long advised clients on how to respond to instances of sexual harassment.
But with the significant uptick in demand from clients since #MeToo gained steam, “We recognized it would make sense to bring them together into a working group,” said partner Joan McPhee, who leads the initiative with fellow former federal prosecutor Jim Dowden.
|Rising Demand
At labor and employment-centric Jackson Lewis, Samia Kirmani leads the firm's workplace training practice group. There's been no need to reorganize, but she says the firm has seen increased demand for work both performing and advising investigations, along with requests for training on how to respond to reports of bad behavior and how to implement guidelines to get ahead of potential issues.
“We have always been focused on preventative practices and training. It's less of a focus on capitalizing on opportunity and more a, 'Let's make sure we can meet our clients' needs,” she said.
Hogan Lovells, which handled an investigation by the Massachusetts Senate into sexual harassment claims against the husband of the chamber's president, relied on traditional relationships between its employment practice and its investigations practice.
“We haven't really changed what we do, we just get more requests for what we do,” said Barbara Roth, global head of the firm's employment practice. “We here have a very well established and highly skilled investigations group. When it comes to employment, we bring a different level of skill to it.”
Ultimately, the total number of investigations prompted by allegations falling under the #MeToo umbrella will be far more than what makes it into the press. Crisis management principles compel CBS's directors to trumpet they have retained both Debevoise & Plimpton and Covington & Burling in response to the airing of accusations against Moonves, and a public body like the Florida Senate has a duty to reveal it hired Jackson Lewis to probe allegations against a lawmaker. But there are bound to be many more incidents where a private entity is looking to conduct an under-the-radar look into reports about an employee.
Some companies will handle the probes themselves, via their human resources department and in-house legal team. Even then, they may seek an outside firm's expertise. One of Kirmani's clients has contacted Jackson Lewis about coming in to conduct a two-day training on best practices for conducting investigations.
There's a spectrum of these investigations, according to McPhee, from those conducted by the affected entity, extending through those conducted by the usual outside counsel, culminating in one conducted on a one-off basis by an unconnected firm. That's the strategy employed by the U.S. Olympic Committee in the investigation into the decades-long abuse by former gymnastics team director Larry Nassar, who has been convicted on multiple counts of sexual assault. A special committee of directors for the USOC has hired Ropes & Gray to conduct an independent investigation.
“There's no traditional attorney-client relationship, past or present,” McPhee said, speaking generally about this type of investigation. “And they are operating independently, typically without any privilege, necessarily without any guidance on how to report the facts, and no interim reporting to the organization that appointed the internal investigation.”
|Matter of Trust
These sexual misconduct probes often require more sensitivity than the probes into potential white-collar crimes that have traditionally been the focus of internal investigations practices.
“If you think about the typical fraud, [Foreign Corrupt Practices Act], or bribery case, they come because an internal audit identifies misconduct, the receipts look off, or an internal whistleblower tips us off,” said Markus Funk, firmwide chair of Perkins Coie's white-collar practice. “In these cases, it's often a much more public facing victim. Companies hear about these things from Twitter, from news articles. We always conduct our investigations under the assumption that they will be heavily scrutinized.”
That attention doesn't just come from the media, but also potential sources of vital information for the probe. Consequently, ignoring the way these inquiries differ from traditional investigations could be disastrous.
“For all of the parallels, and there are many—in terms of forensic fact finding, interviewing witnesses, requesting and obtaining documents—there are challenges,” McPhee said. ”You cannot in the same way simply pick up the phone and call an individual that you might like to speak with in your investigation where the individual is a survivor of sexual abuse without potentially causing a very unwelcome intrusion.”
Similarly, sources for these investigations—who often double as victims—may feel suspicious or even hostile toward figures connected to their employer. That creates another advantage for truly independent investigations, and lawyers who have conducted them in the past.
“It's about gaining the trust and having the track record. When they hear Ann Marie is going to interview them, they're immediately going to go online and check her out,” Funk said of his Perkins Coie colleague. “I do think victims want to talk to folks who are not shills for any company or any organization.”
He added that all these factors are giving companies and institutions cause to call in outside attorneys faster than they would in traditional investigations.
But that is not always the case, nor should it be, according to Kirmani.
“I completely disagree with the premise that an investigation conducted within a company is inevitably tainted,” she said. “It has to be considered on a case-by-case basis.”
Regardless of when attorneys are getting involved, there's little doubt that for firms with strength in the area, these investigations are driving work. Kirmani emphasized that while all evidence was anecdotal, she and the firm had seen more demand for help on probes, along with establishing best practices and training managers to respond to incidents.
At Perkins Coie, Funk estimated that between the investigations group and the labor and employment group, there are “well in excess” of 50 attorneys handling these matters as they arise. And at Ropes & Gray. according to McPhee, there has been a definite “uptick” in the number of attorneys involved. This impression is not surprising, again considering the attention that's been trained on these issues since last fall.
“The major effect of #MeToo has been to make people very cautious,” Roth said. ”They are not taking any chances.”
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