A new “practice” area may be emerging for testifying experts.
When an employee(s) of an organization violates a law, regulatory requirement, etc., the organization can be, and often is, held liable for it. That liability may be, among to other things, criminal in nature (corporate criminal liability) or one associated with government contracting (present responsibility and/or responsible government contractor). It may also be civil, in such instances where there are collateral civil actions (class actions and/or shareholder derivative suits) arising out of the employee(s) misconduct.
One of the primary considerations of corporate liability, at least from the enforcement perspective, is the organization’s corporate compliance & ethics program (“Program”). That Program, in many respects, serves as the “body armor” against vicarious liability because of its consideration under 8B2.1 of the United States Sentencing Guidelines. Government prosecutors and Agency regulators, including suspension and debarment officials, consider an organization’s Program heavily, as demonstrated by the attention focused on such Programs in various government settlement agreements (i.e. Deferred and Non-Prosecution Agreements, Administrative Agreements, Consent Agreements, etc…).
While the benefits of an outside compliance expert are obvious as it relates to demonstrating the effectiveness of a Program to the Government, this may be a consideration in collateral civil litigation, where the Program can become a defense for the organization (or an offense for the plaintiff). Plaintiffs and defendants routinely hire outside experts for all sorts of things associated with such litigation (i.e. damage calculations, forensic accountants, etc.) – Why not a Compliance and Ethics Program Expert? After all, if the organization had an effective Program, what more could they have reasonably done to prevent the misconduct? If the government uses this as the measuring stick, why shouldn’t it be considered in civil litigation?
Just a thought. But if your organization or an organization you represent becomes embroiled in such matters, you should consider how this might fit into your litigation strategy.
If you want more thoughts about how a Corporate Compliance and Ethics Program Expert might fit within the litigation strategy of any matters you are involved in, call me. If nothing else, it would be a very interesting conversation.
The Fraud Guy 