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Criminal Enforcement of Environmental Laws: Part III--From Investigation to Sentencing and Beyond

November 1995

Citation: 25 ELR 10600

Issue: 11

Author: John F. Cooney, Judson W. Starr, Joseph G. Block, Thomas J. Kelly Jr., Andrew R. Herrup, Valerie K. Mann, and Gregory Braker

Editors' Summary: In this last of a three-part series, the authors provide a "how-to" guide for responding to an environmental criminal investigation and discuss the ramifications of an environmental criminal conviction. They first describe several basic procedures that the target of a governmental investigation should follow, emphasizing that the first and best line of defense is to have in place an effective environmental self-auditing program to identify pollution threats and to correct minor problems before they become serious. The authors discuss in detail the benefits and risks of instituting a self-auditing program, including how regulators might be able to use the information generated in a routine self-audit against the company. The authors then examine the six basic methods by which the government can obtain information from a corporation during a criminal investigation: Recordkeeping and reporting obligations, informal visits or consensual inspections, items in "plain view," inspections pursuant to administrative warrant procedures, grand jury subpoenas, and search warrants. They stress that the target should be prepared to respond in a manner that is cooperative and does not obstruct the prosecution, while fully preserving its rights to protect privileged information from disclosure. The authors then discuss how, to protect itself, a company should mount its own internal investigation, focusing on issues such as retaining outside versus in-house counsel, conducting employee interviews, handling multiple representation problems, reaching joint defense agreements, protecting privileged information through attorney-client and work product protections, and negotiating global settlements. They caution that in meeting with the prosecution to discuss its view of the case or to persuade it to drop charges, defense counsel must walk a fine line between revealing too little—and thereby failing to apprise the prosecutor of problems with the case—and revealing too much—and thereby eliminating the element of surprise or compromising its ability to assert applicable privileges. The authors then address the Department of Justice's and EPA's respective policies on parallel proceedings—simultaneous criminal and civil actions against the same defendant that arise out of a single set of facts. They point out how differences between the criminal and civil investigatory mechanisms—particularly operation of the Fifth Amendment privilege against self-incrimination—create significant tactical questions for counsel and due process concerns for defendants. They also discuss the means available to mitigate the possible adverse effects of parallel proceedings, including stays and Double Jeopardy constraints.

Turning to the consequences of a criminal conviction—which play an important role in a defendant's decision whether to seek a plea agreement—the authors first discuss the cleanup obligations the entity will likely face. Next, they explain in detail the formulaic process by which criminal sentences are imposed under the U.S. Sentencing Commission's Sentencing Guidelines. The authors then examine the collateral consequences of a criminal conviction, including collateral estoppel effects in subsequent civil litigation, mandatory "blacklisting" under the Federal Water Pollution Control Act and the Clean Air Act regarding future federal contracts, suspension and debarment from government contracts, federal tax consequences, Securities and Exchange Commission disclosure obligations, and limitations on operations imposed by state "bad actor" statutes. A company defending against environmental criminal charges, the authors emphasize, must be aware of these potential collateral effects from the onset of the government's investigation and should immediately look for opportunities to minimize their adverse effects.

Finally, in a concluding note to the entire series, the authors assess the effectiveness of the federal environmental crimes program after almost two decades. They conclude that although the federal government has taken a series of steps to deter the commission of environmental crimes, there has been little apparent effort by any branch of government to think through what the appropriate level of deterrence should be. Moreover, the policy question concerning the program's proper role in achieving environmental objectives efficiently has not yet been answered. The authors conclude that EPA and Justice should determine how their criminal programs could directly support efforts to target the largest environmental risks, even if it results in a lower "body count" of criminal convictions, and that Congress should trust EPA to determine environmental priorities, rather than setting them legislatively.

John F. Cooney, Judson W. Starr, Joseph G. Block, and Thomas J. Kelly Jr. are partners in the Washington, D.C., law firm of Venable, Baetjer, Howard & Civiletti. Mr. Cooney is a former Deputy General Counsel in the Office of Management and Budget, and a former Assistant to the Solicitor General, U.S. Department of Justice. Mr. Starr is a former Chief of the Enviromental Crimes Section, U.S. Department of Justice. Mr. Block is a former Chief of the Environmental Crimes Section, U.S. Department of Justice. Mr. Kelly is a former Assistant U.S. Attorney.

Andrew R. Herrup, Valerie K. Mann, and Gregory Braker are associates at the Washington, D.C., law firm of Venable, Baetjer, Howard & Civiletti.

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