Did You Receive an FTC or DOJ Subpoena? Be Sure To Preserve Everything Ephemeral


Authors: Steven Cernak & Molly Donovan

The Federal Trade Commission and the Department of Justice are reminding companies that, in responding to grand jury subpoenas and second requests, there is an obligation to preserve data and communications created using “new methods of collaboration and information sharing tools, even including tools that allow for messages to disappear via ephemeral messaging capabilities.” The government has specifically called out Slack, Microsoft Teams and Signal as being some of the applications of concern “designed to hide evidence.”

The government says that while there has always been an obligation to produce information from ephemeral messaging applications in investigations and litigations, the purpose of the reminder is to ensure that counsel and clients do not “feign ignorance” when choosing to use ephemeral messaging to do business. Thus, the FTC and DOJ will include new, explicit language in subpoenas and other requests specifically stating that data from ephemeral messaging applications must be preserved. A failure to meet that obligation could result in obstruction of justice charges.

More generally, once a company has been served with a subpoena, a document hold should be prepared and circulated right away. A document hold is a written notification to relevant employees not to delete, destroy or alter any electronic or paper materials potentially relevant to the subpoena. The notice must unpack what that language means in plain English and should be conservative in describing what “potentially relevant” means—(remember that just because something is being preserved does not necessarily mean it will have to be produced.)

The document hold should apply to all types of messaging (text, IM, DMs, ephemeral) to ensure that all existing and going-forward materials will not be deleted. The relevant persons with IT expertise should certify internally that preservation is occurring effectively, that all auto-delete functions have been turned off, and that back-up tapes are not being purged automatically.

It’s also a good idea to instruct employees not to talk to each other about the subpoena or the underlying subject matter. When employees talk to each other, it can create the appearance of collusion—i.e., employees are coordinating with each other about what to say or not say to the lawyers or to the government. This can raise obstruction suspicions that may only grow if the discussions occur over ephemeral messaging applications that employees think will not leave a paper trail behind.

If employees believe that they or others have violated, or behaved inconsistently with, company policies or relevant laws, employees should discuss that only with in-house or outside counsel—not with each other.

Under no circumstances should employees message, or otherwise reach out to, employees at other companies to discuss the subpoena or the underlying subject matter. If employees receive any communication from an employee at another company relating to the subpoena or investigation, they should report that immediately to counsel to determine the appropriate response, if any.

Generally speaking, all materials existing when the subpoena is received should be left “as is.” Nothing should be taken home. Nothing should be deleted, altered or thrown away. If there is a concern that some materials have been lost, or not preserved properly, it is important to be transparent about that fact with the government so that steps to remediate can be taken right away.

Finally, if your subpoena is from the Department of Justice and concerns a criminal antitrust investigation, there may be an opportunity for leniency. Talk to a lawyer with experience working with the DOJ and its antitrust leniency program to determine if that’s a good option. It may not be, but it’s important to think through the option carefully yet quickly. If you do pursue leniency, the faster you get to the government with a handle on your factual situation, the better your chances of getting a good deal.

For more discussion about subpoena compliance, listen to the “If I Were You” podcast episode on this subject here. Featuring Bona Law partner Jon Cieslak.

Image by 愚木混株 Cdd20 from Pixabay

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