ML20023E136
| ML20023E136 | |
| Person / Time | |
|---|---|
| Issue date: | 02/28/1983 |
| From: | Levi R NRC OFFICE OF THE GENERAL COUNSEL (OGC) |
| To: | Silbert E SCHWALB, DONNENFELD, BRAY & SILBERT |
| Shared Package | |
| ML20023E137 | List: |
| References | |
| NACRLEUT, NUDOCS 8306140509 | |
| Download: ML20023E136 (9) | |
Text
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- i Earl Silbert, Esq.
Schwalb, Donnenfeld, Bray & Silbert 1333 New Hampshire Ave., N.W.
Washington, D.C.
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Re:
Advisory Committee on Rights of Employees Under Investigation
Dear Mr. Silbert:
In accord with our telephone conversation, I am providing you with information on - (l') the effective date of the _ Committee;
'and (2) background information on NRC practice in the area of individual rights and the purposes of the Committee.
j (1)
Effective Date of Committee The Charter of the Advisory Committee for Review of Office of Investigation Policy on Rights of Licensee Employees Under Investigation became effective on February 25, 1983.
I am l
enclosing copies of the January 10, 1983 letter to Gerald Carmin, Administrator of the General Services Administration (GSA), seeking GSA concurrence on formation of this Committee (Enclosure 1) and a note from John Hoyle indicating that GSA had concurred (Enclosure 2).
I am also enclosing a copy of the Federal Register Notice of Establishment of the Committee, 48 Fed. Reg. 5827 (February 8, 1983), which informed the public that the establishment of the Committee was effective upon filing the charter with the standing committees of Congress having legislative jurisdiction for the NRC (Enclosure 3).
The charter was filed with Congress on February 25, 1983 (Enclosure 4).
I am also enclosing a copy of the Charter.
(Enclosure 5).
(2)
Bac'kground Information The NRC, to improve the quality of its investigations, on April 20, 1982 announced the establishment of an Office of 12Jestigations (OI).
One of the functions of OI was to 1
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~ establish policy, procedural and. quality control guidance for investigations.
In response to this directive, on June 17, 1982 the Director, OI, forwarded to the Commission for consideration proposed investigative policies and procedures.
One procedure involved exclusion of third parties from interviews.
On July 16, 1982 the Director, OI, forwarded a memo entitled " Actions for Improvement in NRC Investigations."
Attached to this memo were eleven Investigative Procedure t
Memoranda (IPM), including one on the use of Miranda warnings.
OI subsequently issued an IPM on exclusion of third parties from interviews, consistent with the earlier statement in the June 17 memo.
The proposals were all consistent with current NRC practice, as discussed in the Appendix to this letter.
On August 13, 1982 Mr..Charnoff wrote Chairman Palladino "to request that the Commission solicit public comments on the
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proposed policies prior to their adoption" (Enclosure 6).
Mr.
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Charnoff specifically commented on (1) whether employees of licensees under investigation should be informed by the NRC of their right to counsel, and (2) whether a company attorney may represent a licensee employee during an interview.
I am enclosing an appendix which discusses these two issues at
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length.
(In that appendix I discuss the practice at a few other federal agencies.
I would be happy to -provide a more comprehensive study should you desire.)
With this background, the Commission in November 1982 held two meetings on the proposed investigative policies.
The Charnoff letter and the rights of the licensee's employees were discussed at those meetings.
In this regard the Commission focused on whether interviewees should have a right to counsel.
or non-attorney representative at all interviews (the NRC currently has no provision for non-attorney representation in investigative interviews),~whether they should be advised of this right (or any other rights) prior to any interview, whether the choice of attorney could be limited, and whether an interviewee should have a right to record the interview.
The Commission also briefly discussed whether witnesses should be granted confidentiality.
On November 23, 1982 the Commission responded to Mr. Charnoff, stating that "with
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respect to the issues you raised concerning' individual rights, the Commission has decided to obtain comments from a small j
group of individuals outside the agency."
(Enclosure 7).
As I understand the Charter for the Committee', the Commission intends for the Committee to provide its views on these issues, taking into consideration both the effect on NRC investigations and fairness to the interviewee and the l
licensee.
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I will be happy to provide any further information.
Sincerely, Richard P. Levi Office of General Counsel cc:
Chairman Palladino Commissioner Gilinsky Commissioner Ahearne Commissioner Roberts Commissioner Asselstine Ben Hayes, Director, OI
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APPENDIX With regard to the first topic raised by Mr. Charnoff,'whether interviewees should be advised of their rights prior to investigative interviews, it is the NRC's present practice not to advise interviewees of their right to counsel prior to the interview unless the interviewee is in custody or OI management directs that such warnings be given because of some special circumstance.
It is the NRC's position that persons being interviewed, unless they are being interviewed pursuant to a subpoena, have no legal right to have anyone else present during the interview.
As a matter of practice, however, the NRC does permit persons on request to be assisted by personal counsel in " informal" interviews because a denial of assistance of counsel would likely lead to a refusal to. answer questions, which in turn would lead to a subpoena and a right to counsel.
Mr. Charnoff in his letter stated that several agencies expressly recognize the interviewee's right to counsel in investigative interviews.
I contacted the three agencies cited by Mr. Charnoff, although other agencies would perhaps be more relevant.
The NTSB does not advise interviewees of-their right to counsel prior to the interview.
The CAB.does when the investigaion may lead to criminal action or administrative civil penalty proceedings.
The CPSC regulation covers investigational hearings.
Witnesses to those hearings are subpoened.
The subpoena cites the regulation, which is j
attached to the subpoena.
In that sense witnesses are notified of their right to an attorney.
With regard to the second area raised by Mr. Charnoff, exclusion of the witnesses' attorney from interviews where that attorney also represents the company which is the focus of the investigation, I am aware of two recent instances where this issue arose.
In both cases the company informed its employees that, if they desired, the company attorney would represent them during the NRC investigation.
The company's attorney in both cases informed those involved that he would report anything of interest said during the interview to' company officials.
In one instance at the NRC's suggestion the company agreed that its attorney would not attend the interviews.
In the other~ instance the NRC rearranged the order of the interviews to interview higher level officials first in order to minimize the impact ~of having the company'.s attorney present at the interview.
Mr. Charnoff in his letter discussed several cases involving other agencies which deal with whether an agency "may interfere with the choice of counsel by the person being interviewed because of its potential impact on the investigation."
Charnoff letter at ~4.
In response to your
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request to review the experience of other agencies, I will briefly review both the cases discussed by Mr. Charnoff and several others which have reached dif ferent results. l'/
In addition, I have contacted several other federal agencies to ascertain their policies in this area.
Three district court decisions have upheld the power of an agency under the Administrative Procedure Act (APA) to exclude the attorney of the person being investigated from an 1
interview with a witness even though the witness wanted to i
employ that attorney as his own.
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In United States v. Steel, 238 F. Supp. 575 (S. D. N. Y. 1-9 6 5 ),.
petitioner challenged an SEC rule which provided that " counsel may not represent any other witness or any person being investigated unless permitted -in the discretion of the officer conducting the investigation or of the Commission upon being satisfied that there is no conflict of interest in such representation and that the presence of identical counsel for other witnesses or persons being investigated would not tend to hinder the course of the investigation."
17 CFR 201.3 (emphasis added). 2/
In that case, the SEC, which was investigating the Alaska International Corporation (Alaska),
held that counsel for Alaska could not also represent petitioner because such dual representation would hinder the
, investigation.-
The court, noting that petitioner was free to select any other counsel, found that "nothing done here was any denial of counsel."
238 F.
Supp. at 577.
The court noted that even under the Sixth Amendment in criminal prosecutions "there can be reasonable ~ limitations on the selection of counsel," and that the Commission's rule and conclusion in this case reasonably required that this attorney be ineligible j
to represent the witness at the interview.
Id.
In Torras v. Stradley, 103 F. Supp. 737 (N.D. Ga. 1952), the court held that the APA did not give a witness in an IRS
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investigation "a right to the presence and advice of counsel connected with, or retained by, the taxpayer."
Id. at 738.
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See generally Anno., Right to Assistance by Counsel in Administrative Proceedings, 33 ALR3d 229 (1970).
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This regulation has been repealed.
The SEC now has only a sequestration rule that allows the SEC to bar an attorney who was present during an interview with one witness from being present'at a subsequent interview with another witness.
17 CFR 203.7.
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the taxpayer."
Id. at 738.
The court, never-specifically-discussing the APA provision-in question, held as follows:
It seems not at all unreasonable to exclude the taxpayer's counsel from the interrogction of a witness about the taxpayer's affairs.
The witness' constitutional rights are amply protected so long as he can select counsel from all other attorneys.
Under a contrary ruling it is easy to see that the Government's investigation might be seriously prejudiced.
Id. at 738.
The court in United States v. Smith, 87 F.
Supp. 293 (D. Conn.
1949), similarly upheld the power of the IRS to exclude counsel who also represented the taxpayer being investigated.
In that case the IRS was investigating a corporate taxpayer and wanted to interview three persons, each of whom had been an officer, director and stockholder of the corporate taxpayer.
The government contended that the proceeding, being investigatory, required secrecy just as grand jury proceedings do, and that allowing the taxpayer's attorney to be present-could lead to the taxpayer being apprised of the direction being taken by the investigation.
The court held as follows:
There may be cases where the right to counsel should not include, however, the right to be represented by counsel.who also represents the taxpayer.
While no harm seems likely from such a situation in this case, since the knowledge of these witnesses is necessarily also the knowledge of the taxpayer, any possibility of prejudice to the investigation should be obviated by requiring that counsel be not connected with, or retained by, the taxpayer.
Id. at 294.
One circuit court decision considering this issue, however,
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reversed a district court decision which had held that the IRS could deny a third party witness the right to be accompanied by counsel for the taxpayer being investigated. 3/
Backer v.
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The District Court in Backer had relied heavily on Unite'd States v. Smith, supra.
The Circuit Court in vacating *
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the District Court's decision noted this reliance but did not attempt to explain or distinguish it.
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Commissioner of Internal Revenue, 275 F.2d 141 (5 th Cir.
1960).
The court in Backer noted first that the IRS was acting pursuant to i policy statement, and that it was' doubtful whether the policy statement even covered the situation where counsel is in fact counrel for the witness as well as the taxpayer. 4/
The court next noted that since there was no regulation covering this situation it need not decide whether the Treasury Department could, pursuant to formal rule-making procedures, qualify the right of a witness to be represented by a lawyer who is also counsel for the person under investigation.
The court then held that
"[c]ertain it is that in the absence of any such regulation the Commission cannot put limitations on the general authority to have counsel as granted by the statute by saying. that _the witness's choice cannot include one who also represents the taxpayer."
275 F.2d at 144.
The court, relying on cases involving the Sixth Amendment, held that "[t]he term 'right to counsel' has always been construed to mean counsel of one's choice.
When Congress used the terms 'right to be accompanied, represented and advised by counsel,' it must have used the language in the regularly accepted connotation Id. at 144.
The court concluded as follows:
None of the harm which the Commissioner here apprehends will result from letting taxpayer's counsel represent a witness as his own selected counsel vill result except upon the' failure of counsel to conduct himself in accord with his sworn duty to the court.
If he does so fail then is the time for remedial action to be taken.
Such action is not permissible when, as here, the trial court and government counsel reject any suggestion that either the witness or counsel will violate either the law or the ethics of their profession in the proposed investigation.
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Two other Court of Appeal's decisions, both involving the SEC's sequestration rule, 5/ have also indicated that the 4/
This policy was set forth in a Manual of Instructions for Spe^cial Agents as follows:
"(A) third party witness is enuitled to the attendance of his own counsel, but not the counsel for taxpayer."
275 F.2d at 143.
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See Footnote 2, supra.
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terminology of 5 U.S.C. ' 555 (a) means counsel of one's choice.
SEC v.
Csano, 533 F.2d 7 (D.C. Cir. 1976); SEC v. Higashi, 359 F.2d 550 (9th Cir. 1966).
Both of those courts held, however, that there could be circumstances where an attorney could be barred from the interview, but that it could not be done under the facts of those cases.
The court in Csapo, noting that the authority to disqualify an attorney is plainly inconsistent with 5 U.S.C.
555 (a), held that such an authority, "if it is' to be enforced, [must) be confined within ' permissible limits.'"
533 F.2d at 11.
The court, although it recognized the utility of a sequestration rule "in preserving the integrity of an investigation and recognize its practical necessity under certain circumstances," held that the SEC, before it could exclude an attorney, had to come forth with "' concrete evidence' that his presence would obstruct and impede its investigation."
Id. at 11.
The court held that the mere fact of multiple representation "is no basis whatsoever for concluding that presence of such counsel would obstruct the investigation."
Id.
The court reinforced its conclusion by noting that any j
statements by Csapo could lead to criminal charges against
. hnn, and that therefore his choice of counsel should not needlessly or lightly be disturbed.
In Higashi the court at the outset noted that "[t]he reason for and purpose of the Commission's sequestration rule are clear and there can be no question as to its necessity and general propriety."
In Higashi the SEC had invoked the sequestration rule to prevent the same attorney from representing Silver King Mines, Inc., which the SEC was investigating, and Higashi, a director of Silver King Mines.
The court agreed with the district court that Higashi, as a director of the corporation, could be held responsible for the acts of the corporation, that Higashi and the corporation may j
have interests in common, and that under these facts the Commission exceeded the permissible limits for disqualifying an attorney..The court stated that invocation of the rule here impermissibly " bears directly and prejudicially upon the interests of the witness himself," rather than having its -
i impact limited to the interests of those under investigation.
Id. at 553.
I also contacted several federal agencies.
None as a matter of common practice excluded the compa~ny's attorney where the J
witness wanted that attorney as his personal representative.
The policy followed.by the SEC and the Comptroller of Currency is to make it clear. to the witness that the attorney is also.
representing others and that there is a potential conflict of interest.
If the witness still wants the company's attorney as his own, the interview proceeds with the attorney present.
The FTC' stated that it would allow the attorney to be present l
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unless some real " hanky-panky" were shown.
I am attaching the, regulations of various agencies which relate to the issue of counsel in investigative interviews.
(Enclosure 8).
Finally, with regard to the other issues discussed by the Commission, the NRC does not have a policy. against tape recording interviews where the witness so requests.
The NRC leaves the issue to the discretion of each investigator.
The NRC does have a policy, however, of providing a copy of a signed statement or tape, if one exists, to the interviewee on request.
In the area of witness confidentiality, the Commission's regulations provide only that the identity of a person not subject to Part 21 who reports to the Commission "a known or suspected defect or failur'e to comply.
will be withheld from disclosure."
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