Standing at your front desk with a badge and gun is the local sheriff handing you an official looking document. While this scenario creates a dramatic and perhaps unbelievable picture, it does in fact often occur. A company may receive a subpoena either from a law enforcement official, a process server or through the mail, seeking evidence from a party in a lawsuit that the company is not directly involved in.
What should a company do when faced with a subpoena? Because it is a legal document from a court of law commanding a response, a company must timely respond. Failure to do so may result in a contempt of court charge and financial penalties.
Below are various practical tips to consider when responding to a subpoena:
- Review the subpoena to identify the categories of information requested for production and the deadline for responding to it. A subpoena may request the production of documents, the inspection of a premises, and/or testimony at a deposition or trial. Legal rules applicable to subpoenas allow a short time frame for challenging and responding to a subpoena – typically this period is 14 days after the subpoena is received.
- Immediately suspend the routine destruction of documents for the categories of information requested and implement a litigation hold to preserve relevant information and documents. Careful evaluation of routine destruction is particularly important in today’s electronic data world where those who create the data don’t necessarily manage its destruction.
- Identify a point person responsible for timely compliance with the subpoena, including the collection and analysis of responsive information, as well as the coordination and production of it. Depending on the scope of information sought and the organizational tree of a company, a subpoena response team may need to be formed.
- Review the notice requirements of company insurance policies to determine whether the receipt of a subpoena is a triggering event for coverage. If a subpoena seeks testimony from a company’s officers or directors, the notice requirements of Directors and Officers liability insurance may apply.
- Notify company officers, select employees, IT personnel, custodians of records and others who have responsive information and/or documents that a subpoena was received and the response deadline.
- Address any company gossip regarding the subpoena by notifying employees that the request for evidence was for a tangential matter and not litigation involving the company.
- If the subpoena requests the production of documents, determine the record custodians, the approximate quantity of responsive documents, and identify whether any documents are subject to confidentiality restrictions or prohibited from disclosure by law. If so, a protective order will need to be obtained before confidential documents are produced.
- If the subpoena requests testimony, determine the availability of the witness to testify on the specified date. If a witness is no longer employed by the company, determine the circumstances under which the witness’ employment was terminated and the anticipated level of cooperation from the witness. If the subpoena requests testimony from “corporate representatives” on certain specified topics, identify the witnesses with relevant knowledge of the topics and determine their availability.
- Evaluate the company’s position and optional responses to the subpoena. A company’s response to a subpoena may be impacted by its relationship to the parties in the litigation. If the company is a business partner of the party that issued the subpoena, it may be more willing to cooperate in responding to the subpoena than if a company is a competitor of that party. Optional responses to a subpoena include (a) engaging in an informal but meaningful dialogue with the party seeking production to resolve concerns about it, (b) formally objecting to it on a variety of grounds, (c) complying with it, (d) filing a motion to quash/modify it, or (e) filing a motion for protective order seeking to limit the scope of information requested.
- Calculate the anticipated cost of compliance and consider appropriate cost-shifting. Courts are mindful of the burden imposed on subpoenaed companies and may order cost-shifting in rare instances where the cost of compliance is deemed to be “significant.” A company’s claim of significant expense must be supported by specific information of compliance costs – e.g. hiring vendors to assist with the gathering and reviewing of data, quantifying the value of employee time spent in compliance efforts, etc.
- Determine whether the company should respond directly to the subpoena or hire a lawyer to assist in the response. If a company is familiar with subpoena response procedures, it may choose to respond on its own. The company should consider hiring legal counsel to assist in responding to a subpoena if any of the following are involved: confidential or privileged information, a high volume of documents, testimony from a senior executive or board member, and/or the subpoena is subject to objection. An attorney can assess the validity and scope of a subpoena, help evaluate a company’s position, weigh the options to respond and recommend an appropriate course of action in light of the existing law and procedural requirements.