In times past, prosecutors were only—or at least primarily—interested in putting your clients in jail and fining them. And regulators were only trying to sue your clients for money, or to regulate them by lawsuits that sought to put your clients out of business or impose significant limitations on how they could do business going forward.

Not so true anymore. More often than one might think, you show up at a prosecutor's office after a grand jury subpoena duces tecum is served by the FBI to discuss the investigation. When there, you encounter, along with the FBI agent, a representative of, say, the SEC, CFTC or HHS—thus communicating to you that your client is in for a multi-pronged battle. Meaning, you affirmatively know right then that communications with or proffers to the prosecutor on your client's behalf may be considered, not only by the prosecutor's office, but also by the regulatory agency. Well, at least you know! And you might decide, right then and there, that you will not be forthcoming, or as forthcoming as you might otherwise be if you were just dealing with criminal investigation personnel.

But what if they're not present, and so you conclude that you only have to deal with, for example, the criminal arm of the U.S. Attorney's office? Or the converse: Your client's records are subpoenaed by the Civil Division without you knowing that the Criminal Division is directly involved, or that its presence is close to the horizon. In other words, when issuing the civil subpoena, the "unitary" office—whether or not it chooses to acknowledge that—recognizes the possibility that the investigation may turn criminal at some point.

The same is true if the investigation is begun by the New York Attorney General's Office, which imposingly, also, has both civil and criminal arms, and you're not told or led to believe that there also already exists potential trouble for your client at the office's next floor up, or down.

Now, for sure, the onus is probably on you as the lawyer, to straight up ask the question: "Is there a civil (or criminal) investigation also underway, or being considered?" There is potential danger in that approach. After all, assuming your client has been subpoenaed by the civil wing, you may not want to even raise a concern about the possibility of criminal wrongdoing. And so, you might choose to forego the question, or at least raise it in that (you believe) coy manner: "Anyone else in your office looking into this?" Not ideal, but maybe better than boldly going where the wise fear to tread.

The problem, though, for those who have been there, is that oftentimes the attorney is met with an equally coy—read, BS—response. Something along the lines of "I haven't discussed it." Or, "I'm in this bureau." Or, "I'm personally not aware of anything active at the moment." Now, each of those answers may be true but, intentionally, not particularly illuminating. In Santobello v. New York, 404 U.S. 257, 262 (1971)—albeit in a totally different context where a criminal prosecutor wasn't aware of a sentencing promise by a fellow criminal prosecutor —the Supreme Court noted that staff lawyers in a prosecutor's office did have the burden of "letting the left hand know what the right hand is doing" or has done, inadvertent as the oversight may have been.

Up the chain of authority within a prosecution office, maybe at its very top, by the way, there is someone with responsibility for both the criminal and civil enforcement units. So, do you go up the chain and potentially make a mountain out of a molehill? You likely have to call "an audible," as football aficionados might refer to it, determining on the spot whether you want to risk getting in too deep with one wing of the office when you suspect a strong potential for complementary investigations within the same office.

The Rules

Needless to say, we're not talking here about a situation where you ask the government attorney directly if she knows that the other wing has already opened an investigation and she outright denies it. There, the ethical violation is clear and simply shouldn't be tolerated—no government attorney, indeed, no lawyer, is free to lie to or deceive an adversary. Period. NY Rule of Professional Conduct 4.1 ("a lawyer shall not knowingly make a false statement of fact or law to a third person"); cf. ABA Model Rule of Professional Conduct 4.1 (a lawyer shall not knowingly "make a false statement of material fact or law"); NY and ABA Rule 8.4(c) (a lawyer shall not "engage in conduct involving dishonesty … or misrepresentation"); ABA Criminal Justice Standards for the Prosecution Function 3-14 ("The prosecutor should not make a statement of fact or law … that the prosecutor does not reasonably believe to be true … except for lawfully investigative purposes"). Further, there may indeed be legal consequences to any case that results on either the civil or criminal side from such a false statement by the government attorney.

Case Law

Now, the Supreme Court itself has held that there is nothing wrong with the Office double teaming your client with parallel investigations, so long as it does not act in bad faith. See United States v. Kordel, 397 U.S. 1 (1970); see also Securities and Exchange Commission v. Dresser Industries, 628 F. 2d 1368 (D.C. Cir. 1980). The criminal wing, however, may not share evidence obtained by grand jury subpoena (protected by grand jury secrecy) to advance the ball civilly, absent a court order. FRCP 6(e)(3)(C)(i); see U.S. Department of Justice Manual 9-11.254; Prosecutorial Misconduct (Bennett L. Gershman, Thomson Reuters), §§3:21-23. Put simply, "using a grand jury subpoena to obtain discovery in a parallel civil proceeding is an abuse of process, and the subpoena should be quashed," Gershman, citing In re Grand Jury Subpoena, 175 F.3d 332 (4th Cir. 1999); Matter of April 1956 Term Grand Jury (Cain), 239 F.2d 263 (7th Cir. 1956) (the grand jury had the right to seek assistance from the IRS, but the IRS may not "in any manner" use the records or information for any other purpose—"and specifically for any civil purpose such as tax collection …"); "[I]f it had been intended that the attorneys for the administrative agencies were to have free access to matters occurring before a grand jury, the rule would have so provided." United States v. Bates, 627 F.2d 349 (D.C. Cir. 1980) (rejecting request by Federal Maritime Commission for access to grand jury records); see also generally Fed. R. Crim. Pro. 6(e); U.S. v. Doe, 341 F. Supp. 1350 (S.D.N.Y. 1972); In re Grand Jury Subpoena, 175 F.3d 332 (4th Cir. 1999); In re Grunberg, 453 F. Supp. 1225 (S.D.N.Y. 1978).

There is nothing wrong if the government, not acting in bad faith or misleading the defendants into turning over evidence, uses the civil authorities to obtain information used in the criminal investigation. United States v. Stringer, 521 F. 3d 1189, 1193 (9th Cir. 2008) is the leading case. In Stringer, there were concurrent SEC civil and U.S. Attorney criminal investigations. When defendants sought to dismiss the indictment on the theory that the government engaged in deceitful conduct by conducting simultaneous investigations, the Ninth Circuit determined that the SEC never hid from the defendants "the possibility—even likelihood—of such an investigation." Civil subpoenas included a form (the 1662 form), which stated that information could in fact be used in a criminal proceeding. At a deposition, the following colloquy took place (perhaps an example of "coy" questions and answers):

MR. MARTSON [Stringer's attorney]: My first question is whether Mr. Stringer is a target of any aspect of the investigation being conducted by the SEC.

STAFF ATTORNEY: The SEC does not have targets in this investigation.

MR. MARTSON: The other questions I have relate to whether or not, in connection with your investigation, the SEC is working in conjunction with any other department of the United States, such as the U.S. Attorney's Office in any jurisdiction, or the Department of Justice.

STAFF ATTORNEY: As laid out in the 1662 form, in the routine use of section there are routine uses of our investigation, and it is the agency's policy not to respond to questions like that, but instead, to direct you to the other agencies you mentioned.

MR. MARTSON: And which U.S. Attorney's Office might I inquire into?

STAFF ATTORNEY: That would be a matter up to your discretion.

Counsel never inquired, and the Ninth Circuit, reversing the district court's dismissal of the indictment, concluded "there was no deception or affirmative misconduct … that warranted dismissal of the indictment or suppression of any of the evidence in question."

Query: Would (should) the outcome have been different if the civil and criminal investigations were arms of the same office, i.e., an office, for example, the U.S. Attorney's office or the State Attorney General's office, in which, when you go high enough, there is indeed someone with ultimate responsibility for both investigations? If Stringer's attorney was faced with that scenario i.e., had he asked the civil division attorney if the criminal division of the same office was simultaneously conducting an investigation, would he/should he have gotten away with the same type of response that Mr. Martson was given, particularly if the civil attorney indeed knew? Or should Mr. Martson have been obliged to make a record by directly asking something like, "Are you saying you don't know if a criminal investigation is underway?" And would that have been sufficient if he received an equally evasive response?

Conclusion

Yes, government attorneys must, indeed, speak truthfully to counsel for individuals under inquiry or investigation—when they speak to them. However, as discussed above, in most cases where counsel seeks answers to whether a criminal (or civil) investigation might be underway by, say, the U.S. Attorney's Office or State Attorney General's office, the Stringer holding, particularly if followed in the Second Circuit or by New York state courts, may be key. Meaning, if you actually ask, and if the government attorney, prosecutor or regulator, uses bureaucratic legerdemain as in Stringer to avoid directly answering your question (although without directly misleading you), before your client essentially waives the fifth amendment, the onus probably remains on you to take the bull by the horns to find out whether a criminal (or even civil) investigation is underway.

Joel Cohen, a former prosecutor, is senior counsel at Stroock & Stroock & Lavan. He is an adjunct professor at Fordham Law School. Dale J. Degenshein, a partner at Armstrong Teasdale, assisted in the preparation of this article. They have recently published 'I Swear: The Meaning of an Oath' (Vandeplas Publishing, 2019). The views expressed herein are the authors', and do not necessarily reflect those of their respective law firms.