Often, when faced with the need to investigate an employee's
complaint of harassment or discrimination, employers will ask their regular
company counsel to investigate the allegation and defend the company if
litigation ensues. The recent mistrial declared by Judge Adams in the United
States District Court of the Northern District Ohio after 7 days of a jury
trial is a dramatic example of why employers may want to rethink this approach.
This case has a somewhat tortured and long history, but here
are the highlights relative to the issue of the production of the investigation
notes during the jury trial and the selection of the internal investigator. My Insights
for Employers are provided after the summary.
In March of 2006, at least two employees of Spitzer Motor
City ("Spitzer") complained to management that they were being discriminated
against and harassed. Spitzer's regular outside counsel was contacted and
"investigated" the concerns and advised management on how to proceed.
Not satisfied with the employer's response, several
employees subsequently filed discrimination and retaliation charges with the
EEOC. Spitzer's regular counsel responded on behalf of Spitzer citing to the
"investigation" he had conducted. By way of example, here is an excerpt from
to the EEOC from Spitzer's regular counsel:
"In the process of investigating Mr. Okafor's allegations, I
became aware that Mr. Okafor himself has made certain offensive and racially
discriminatory comments . . . . These comments and statements by Mr. Okafor are
detailed in the attached statements and those statements must be investigated
because they violate company policy."
In September of 2006, the EEOC filed the first
of several Complaints.
On November 11, 2006, Spitzer's regular counsel (the same
two attorneys who had investigated the underlying employee complaints)
Answer. In it, they asserted the Faragher/Ellerth affirmative
defense. As such, they put directly at issue the reasonableness and efficacy of
their own investigation into the allegations that were the subject of the
During the discovery period and even after it formally
closed, plaintiffs made repeated requests for all documents related to the
internal investigation conducted by Spitzer's regular counsel. Click here for
an example of these
Over three years into the lawsuit, plaintiffs served
a subpoena on Spitzer's Regular Counsel. In it, they compelled him to
appear for a deposition and bring with him all documents related to any
complaints (formal or informal) of discrimination, harassment or retaliation.
You can read the exact wording on the last page of the above link.
Three weeks later, Spitzer's regular counsel filed a motion
to withdraw. In so doing, Spitzer's regular counsel advised the court that
he "will be a witness in this matter and cannot continue as counsel."
Almost four years after the first employee complaint,
Spitzer had to retain a new law firm.
Almost seven years after the first employee complaint, the
jury trial started.
Six days into the jury trial, it was discovered that
Spitzer had failed to produce handwritten notes from the investigation
conducted by its regular counsel. The Judge declared
Insights for Employers
As the above scenario demonstrates all too vividly, it is
critical for employers to recognize that if they choose to use their regular
legal counsel (either in-house or outside counsel) to conduct a workplace
investigation that their regular legal counsel could become a fact witness in
any future litigation. If the investigating attorney becomes a fact witness,
any applicable attorney-client privilege would be waived. Moreover, the
attorney and his or her law firm would be conflicted out from the ability to
represent the employer in the litigation.
Recognizing the importance that an investigation be
impartial and objective and anticipating that the complaint has the potential
to end up in litigation, the person selected to conduct the investigation
A thank you and Hat Tip to workplace investigator and
blogger Sindy Warren for bringing this case to my attention in her blog article
Complaint Tip: Don't Have Your Lawyer Investigate."
articles about managing workplace conflict at Win-Win HR, a blog by Lorene
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