This article from the Legal Times sets out the by-now standard account of the conviction of Arthur Andersen for obstruction of justice — in-house lawyer Nancy Temple sends a routine reminder e-mail, instructing an Andersen partner working on Enron matters that it would be useful to "make sure that we have complied" with Andersen’s document retention/destruction policy. (This article is referred to in John Steele’s post, below.) The full text of the e-mail is:
Mike –
It might be useful to consider reminding the engagement team of our documentation and retention policy. It will be helpful to make sure that we have complied with the policy. Let me know if you have any questions.
Nancy [attaching copy of policy]
The partner, Mike Odom, read that e-mail as containing a tacit suggestion to crank up the machinery of document destruction, and the shredding of thousands of Enron-related documents began. In the prosecution of Andersen for obstruction of justice, the government used this e-mail as evidence that Temple "corruptly persuaded" Odom and others to make documents unavailable for an official proceeding.
If that were the basis on which Andersen was convicted, this case wouldn’t be as troubling. As I tell my students, Temple’s e-mail was unnecessarily ambiguous. She easily could have added a sentence to the e-mail:
In any event, it is important to keep in mind that under no circumstances must documents be destroyed that may have any relevance to a pending or foreseeable litigation or government investigation.
That’s a bit overbroad, because for the purposes of criminal penalties there probably has to be a pending judicial proceeding, not one that is merely forseeable, but it’s probably useful to err on the side of caution here. The downside risk is just too great, not only of criminal prosecution for obstruction of justice, but of litigation sanctions for spoliation of evidence. A finding of spoliation of evidence does not depend on a pending judicial proceeding; the duty to preserve documents may arise when the proceeding is reasonably foreseeable. The e-mail as it exists is ambiguous, and could have been interpreted by an overeager Andersen partner as implicit permission to shred documents.
But all of this may be beside the point because of the ground for the jury’s verdict. The jury concluded that the "corrupt persuasion" charged by the government did not come in the form of Temple’s tacit instruction to destroy documents. Rather, it was based on a different e-mail, sent from Temple to David Duncan, also an Andersen partner, suggesting some changes to a draft memo that Duncan was circulating for comments. Temple suggested modifying some of the language in the memo, in effect to clean up the paper trail in the event that the document was later discovered in litigation. Note that she was not suggesting that Duncan alter a document that already had evidentiary significance — e.g. a memo that had already gone out in final form. Instead, she was suggesting changes to a draft before it became a final document, in order to make the final document less susceptible to misinterpretation in possible litigation. That advice sounds like the kind of bona fide legal advice that lawyers do, and should be able to, provide all the time.