Tinker, Tailor, Lawyer, P.I.: Are Your Workplace Investigations Complying With The Law?

Co-authored by Lindsay Harris, founding principal of West Coast Workplace Investigations, an internal investigations Law Firm in Berkeley, California, and serves on the Board of Directors of the Workplace Investigators, a professional member association focused on promoting and enhancing the quality of impartial workplace investigations

How Attorneys Conducting Workplace Investigations Can Comply with N.Y.'s Private Investigator Law & Rules of Professional Conduct

The recent high-profile trial in Ellen Pao vs. Kleiner Perkins [No. CGC-12-520719 (S.F. Cty. Super. Ct. filed 5/10/2012)], in which Pao unsuccessfully sued her employer, venture capital firm Kleiner Perkins, for gender discrimination and other claims, highlights the increasingly important role of attorneys who are retained by organizations to conduct impartial investigations of alleged workplace discrimination, retaliation, and harassment. Though not as widely covered by the mainstream media as other aspects of the case, the trial included crucial testimony from an attorney whom Kleiner Perkins had retained to independently investigate Ms. Pao's complaints, as well as from opposing experts who testified with respect to the adequacy of that attorney's investigation.

Many lawyers who perform such workplace investigations — in Silicon Valley and beyond —face confusion about their proper role and the ethical duties that govern them. In conducting such investigations, are they acting as attorneys? If so, how can they be impartial? And if not, in what capacity do they act? Moreover, increasingly, these questions are finding their way into court cases and judicial and administrative decisions. For example, at trial, the judge in Pao asked the employer's expert whether the employer's attorney investigator possessed authority under state law, absent a private investigator's license, to conduct the type of workplace investigation he did.

Faced with such riddles, lawyers who conduct workplace investigations have taken different tacks. While some conduct investigations in their capacity "as attorneys," many do not. Of those who do not, some structure their investigative engagements ambiguously, leaving it unclear whether they are acting as attorneys or not, while still others explicitly state in their engagement agreements that they are not acting as attorneys. Although not licensed private investigators, these attorneys insist they are not performing legal services in connection with the investigation. They contend that eschewing an attorney-client relationship and the responsibility to advocate for a particular client is the only way to ensure their investigation is truly impartial. They further contend that, since they are not acting as attorneys, the full range of attorney ethics rules do not apply to their investigative work.

In this article, we will show that this approach, when applied to workplace investigations in New York, violates New York's statutory scheme, which allows attorneys to conduct workplace investigations without a private investigator's license only if they are acting "in the regular practice of their profession." Moreover, this approach misperceives the flexibility built into New York's Rules of Professional Conduct (RPCs), particularly RPCs 1.2(c) and 2.3, which allow lawyers to limit their roles to purely impartial investigative functions. Finally, it ignores that while the RPCs do place strictures on what attorneys can do in investigations, they also provide advantages that non-attorney investigators do not have — most notably, the attorney-client privilege and work product protection.

New York Private Investigator Licensure Requirement & Attorney Exemption

New York, like most other states, requires private investigators to be licensed. Under New York General Business Law §70(2) (N.Y. GBL) [McKinney 2011], no person or entity "shall engage in the business of private investigator...without having first obtained from the department of state a license so to do." N.Y. GBL §83, however, specifically exempts practicing attorneys from the licensure requirement, providing that "[nothing] contained in this article shall be construed to affect in any way attorneys or counselors at law in the regular practice of their profession" Similar exemptions exist in many other states.

Attorney Investigations Fall Within Scope of 'Private Investigation'

N.Y. GBL §83 implicitly recognizes that lawyers' activities often encompass "private investigation," as defined by New York law. This is particularly true of attorneys who conduct workplace investigations, which typically include gathering and review of documents, interviews of witnesses, and summarizing the available facts to determine if improper acts or omissions occurred. N.Y. GBL §71(1) defines "private investigator" broadly enough to encompass these activities, as it includes persons who investigate "the identity, habits, [and] conduct ... of any person, group of persons, ... firm or corporation," "the credibility of witnesses or other persons," and "the conduct, honesty, efficiency, loyalty or activities of employees, agents, contractors, and sub-contractors." The definition also includes "the securing of evidence to be used before any authorized investigating committee, board of award, board of arbitration, or in the trial of civil or criminal cases." [See Id.] In short, New York's definition of "private investigation" encompasses the sort of factual inquiry often performed by attorneys.

This conclusion is confirmed by Megibow 397-DOS-13 (2011), a recent New York Department of State decision granting a former attorney's application for a private investigator's license. Under N.Y. GBL §72 there are certain experience requirements which private investigator applicants must meet in order to obtain a license:

Every such applicant for a license as private investigator shall establish to the satisfaction of the secretary of state...[that s/he] has been regularly employed, for a period of not less than three years, undertaking such investigations as those described as performed by a private investigator in N.Y. Gen. Bus. Law §71(1) (McKinney 2011), as a sheriff, police officer in a...