On May 2, 2024, the Boston Bar Association (BBA) held its fifth annual White-Collar Crime Conference, featuring panel discussions with current and former prosecutors at the state and federal levels, defense counsel, and members of the federal judiciary. The conversations with the bar and bench yielded several important insights for white-collar practitioners in Massachusetts. We detail below some of the most salient takeaways from the conversations among practitioners.
Navigating Cooperation with the Government
One of the key topics that cut across multiple panels was whether (and how) a white-collar defendant should cooperate with the government. As always, we heard government attorneys urging early and fulsome cooperation and defense attorneys expressing apprehension about their clients cooperating without any certainty about what they stand to gain. Many discussions focused on the threshold question of what full cooperation with the government entails, and responses from the panelists with the U.S. Attorney’s Office (USAO) for the District of Massachusetts emphasized that there is no clear answer – or, as Acting U.S. Attorney Joshua Levy stated, “you know it when you see it.” Defense attorneys emphasized the risks presented by that uncertainty and the fact that cooperation may look different depending on the particular Assistant United States Attorney (AUSA) assigned to a case.
Panelists also grappled with the risks and rewards of cooperation at an individual level. Acting U.S. Attorney Levy acknowledged the recently announced policies of certain other districts—including the Southern District of New York (Feb. 13, 2024) and the Northern District of California (March 14, 2024)—that more directly encourage individuals with knowledge of misconduct to come forward and disclose that information in exchange for more lenient treatment by the government. The USAO for the District of Massachusetts, however, has no current plans to adopt a similar policy, and will take a “wait and see” approach before implementing that type of “individual” voluntary self-disclosure policy. Nonetheless, Levy noted that the office has long been willing to consider, on a case-by-case basis, entering into a non-prosecution agreement (NPA) with an individual who voluntarily discloses.
Civil False Claims Act Enforcement
Newly promoted Chief of the Civil Division at the USAO, Abraham George, discussed the priorities and expectations of his former unit, Affirmative Civil Enforcement (ACE), with particular emphasis on False Claims Act (FCA) enforcement in the healthcare space.
George noted early in his remarks that his unit had been busy with a “historic volume” of litigated cases in recent years. While Goerge was quick to share his view that the rise in litigation was unconnected to the ACE unit’s policy of the last several years that requires settling entities to admit to underlying facts, that view was sharply contested by his fellow panelists from the defense bar.
George also highlighted that the ACE unit has now received four voluntary self-disclosures of FCA-related conduct, though no resolutions from these cases were ready to be publicly announced. While George acknowledged that there is less guidance on the civil side as to what benefits a voluntarily-disclosing entity can expect, he clarified that a disclosing entity should expect more favorable treatment than a comparable entity that did not disclose, such as may be indicated by the damages multiplier applied at settlement from case-to-case. Indeed, George noted that defense counsel’s identifying a comparable case with a more beneficial damages multiplier, despite a lack of voluntary disclosure, could be a basis to seek an audience with him and/or Acting U.S. Attorney Levy.
George could not point to specific Department of Justice policy regarding a voluntary self-disclosure’s impact on whether or not the government would require a Corporate Integrity Agreement (CIA) in a civil settlement agreement. However, he noted that the Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Health Care Fraud Self-Disclosure Protocol specifically provides the opportunity to take CIAs off the table in self-disclosure resolutions. George further noted that, while he could not speak for HHS-OIG, the protocol would still be relevant to his office’s treatment of cases because his office works closely with HHS-OIG in resolving healthcare fraud cases, such that practitioners can assume a voluntary self-disclosure to the USAO will be presented as such to HHS-OIG, even if not made using the protocol’s online submission form.
Monitors
Compliance monitorships are a powerful tool in the government’s arsenal and are often implemented in connection with a settlement involving a CIA or deferred prosecution agreement. In multiple panels throughout the day, both federal and state prosecutors emphasized their offices’ increased prioritization on implementing compliance monitorships in resolving corporate cases. First, Deputy Chief Kevin Lownds of the Medicaid Fraud Control Unit at the Massachusetts Office of the Attorney General (OAG) noted this policy for state enforcement, and he distinguished his office’s approach to monitorships (i.e., negotiating them in conjunction with negotiations regarding monetary settlements) with that of the USAO, which defers to the U.S. Department of Health and Human Services to engage with defendants regarding the need for a monitorship. Later, Co-Chief of the Criminal Division at the USAO, Amanda Strachan, noted the federal government’s similar prioritization of monitorships based on direction from the Deputy Attorney General in Washington. Both panelists, on behalf of both the OAG and the USAO, noted that defense counsel should present efforts to remediate misconduct and improve compliance throughout the course of discussions with the prosecutor, as such information could be a helpful component of making the case to avoid imposition of a monitor.
Access to the Top
Federal line AUSAs wield tremendous power in the management of their particular cases. Nonetheless, actors on both sides recognize that line AUSAs’ discretion is not unbounded or infallible. Acting U.S. Attorney Levy, himself a former white-collar defense attorney for many years, acknowledged that defense counsel may sometimes wish to communicate directly with those in the office above the line AUSA. And Levy stated that he and his senior leadership remain open to such conversations, particularly when the case presents “a close call” or when the case is at an inflection point, like a charging decision. However, Levy stated he will not take such meetings solo, and clarified that practitioners should expect no side channels to the top: any such meeting would involve the line AUSA. Levy’s remarks provide helpful guideposts to defense counsel in an area that presents strategic questions and risks.
Insights from the Bench
Through panels with magistrate judges from the District of Massachusetts, as well as Chief Judge Dennis Saylor, the bar gained valuable insights for defense representation in white-collar cases. For example, several magistrate judges noted a “missed opportunity” for counsel who rest on whatever conditions of release the court initially imposes on their client, rather than seeking to modify those conditions after a showing of compliance over a period of months. Defense counsel aware of ongoing investigations and a forthcoming indictment can also facilitate the difficult day of an initial appearance by negotiating a self-surrender and preparing their client for a speedy pre-trial services interview, which can include preparing written answers to standard biographical questions that the client can bring on the day of their arraignment. Chief Judge Saylor noted that the district is working on more efficiently resolving cases, including through efforts to facilitate discovery in complex, document-heavy cases. The court is increasingly requiring prosecutors to identify key documents in its productions, in addition to the district’s Local Rule 116.10, which already requires indices for voluminous productions.
Varsity Blues
During a conversation with Acting U.S. Attorney Levy, the lead federal prosecutor for the District of Massachusetts expressed continued support for “Operation Varsity Blues,” an unprecedented investigation into allegedly wide-ranging criminal conduct in the college admissions process. The investigation and resulting prosecutions led to over 50 convictions, but also some defense victories at trial and on appeal. Though some courts in the First Circuit have rejected some of the government’s farther-reaching theories, Levy pointed to some of the “core theories” of the investigation that he argued remain valid: admissions test scores as wire-fraud “property” under 18 U.S.C. § 1341, and a university coach as a federal-programs bribe recipient under § 666. Levy also defended the wider impact of the investigation on the college admissions system across the country, even at schools not directly implicated by the criminal cases.
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As always, the day provided a robust and insightful set of conversations among members of the Boston white-collar bar and bench. The conference continues to present a beneficial opportunity for frank discussion between defense counsel and prosecutors about the state of the practice.
