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Whistleblowers Beware

By Reuben Guttman

For fraudsters, government expenditures are a license to steal. One thing fraudsters know is that with trillions of dollars in expenditures from federal and state governments in healthcare dollars and bucks for battle tanks and fighter jets, there are not enough eyes watching the till to keep cheaters in line.

Now, in response to a pandemic, the government has pushed over $2 trillion out the door in stimulus money. Government dollars will be earmarked for grants, loans, and for the procurement necessary to battle the COVID-19 pandemic and mitigate the economic consequences of the consequent quarantine.

With government investigators already stretched too thin in enforcing compliance, there will be a need for whistleblowers to pick up the slack. Whistleblowers are no more than everyday honest citizens with an inherent litmus test fabricated from common sense and integrity which causes them to raise questions when they see impropriety. Though the current President has through his words and conducted attempted to cast a pall over the conduct of whistleblowers — particularly as they have lent transparency to his conduct — the truth is that we are a nation whose rule of law was tempered for the better by the work of whistleblowers. Those challenging the statute quo eradicated the evil of slavery, brought voting rights to women, worked to eradicate discrimination in our educational systems, and have challenged workplace harassment and discrimination based on race, gender, religion and sexual orientation. Whistleblowers have exposed unlawful pharmaceutical marketing practices and scams by fraudsters selling college and graduate degrees.

Whistleblowers now have a new challenge. In the provision of healthcare supplies and healthcare itself, they will have an opportunity to be the watchful eyes who can protect government expenditures and the quality of healthcare. In businesses — large and small — across the country they can monitor applications for government grants and loans and make their voices heard when they see impropriety.

For those who step forward and seek to bring transparency to wrongdoing, there is in existence a law dating back to 1864 that provides individuals the right to step into the shoes of the government, report fraud, and bring litigation in the name of the government to seek economic redress on behalf of the government. That statute is called the False Claims Act allowing redress against those who cheat the Federal Government. More than 20 states — including California, New York, Illinois and Florida — have their own False Claims Acts allowing whistleblowers to bring litigation when the fraud involves sate dollars.

There has been over the past several weeks clamor about the importance of this statute and perhaps a need to amend it to make it more effective in batting the fraud that will arise out of the misuse of stimulus dollars. Those who litigate under the False Claims Act know that the law was thoughtfully drafted and is effective. It needs no amendment. What is needed is an administration that fully respects the importance of whistleblowers. Americans need an administration that will fully staff — at the agency level — the ability to investigate and analyze the information and complaints brought forward by whistleblowers. We need an administration committed to imposing the full panoply of damages — treble actual damages and civil penalties — on wrongdoers. And we need an administration that goes after individuals and not merely the corporate shells that provide cover for their misconduct.

Whistleblowers are our heritage; they are an American tradition. Honoring them and protecting our stimulus dollars means aggressive enforcement compliance under a law that is on the books and works.

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COVID-19 Will Lead to New False Claims Cases

The COVID-19 virus is inspiring new private-public relationships that will lead to a new generation of whistleblower cases under the Federal False Claims Act.

Government is injecting billions of dollars into the private sector for medical devices and necessary healthcare equipment. The private sector is now supplying everything from tests to masks and ventilators. In the massive purchase of products and services there is not a corresponding gearing-up in oversight. Whistleblowers will be essential in documenting defective products, and false billing for services or products not supplied or rendered.

The fraud will not just be limited to medical products; state and federal governments are spending billions to build temporary medical facilities and there is no doubt that there will be fraud, waste and abuse in their construction.

To keep the economy from collapsing, the government has made grants and loans worth billions of dollars. Recipients of government funds must make truthful representations on their loan or grant applications and they must continue to meet the requirements of the loan or grant for an extended period of time. The conditions of receipt of government funds are as detailed as the requirement that a recipient remain neutral in a union organizing campaign; in other words, ripe for misuse.

The bottom line; COVID-19 has created a new role for whistleblowers.

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On the Rule of Law: The Times They are a-Changing and So Should Trial Advocacy Training

By Reuben A. Guttman |

As a lawyer, I grew up in dusty warehouses, the repositories for massive document reviews. I tore through boxes, often disappointed to find reams of computer runs, no doubt the product of a twentieth-century printer that pecked out letters one at a time. I drafted my first complaint on an IBM Selectric II typewriter, hitting the whiteout key repeatedly with my index finger, often erasing entire sentences at a time. I walked that complaint to the federal courthouse in Pittsburgh, Pennsylvania, wrote out a check from my personal account, and received the file stamped copy. Back in the days of the “notice pleading,” my eleven-page masterpiece was a triumph. 

For young lawyers, this may seem like the practice of a different age. For veteran attorneys, it was yesteryear. In my lifetime, technological changes have rewritten the rules of litigation and trials. 

The days of the dusty warehouses are gone. Documents arriving on zip drives are uploaded to a platform enabling a lawyer to lay in bed at night and access millions of pages of potential evidence on a two-pound iPad or small iPhone. 

With iPhones, virtually every person, from every corner of the earth, can be videoed, photographed, or audio-recorded at a moment’s notice. Spontaneous comment, once pried loose through deposition testimony, is now recorded for posterity on Twitter feeds, Facebook newsfeeds, LinkedIn profiles, Instagram accounts, and emails. What should never have been can now be undone using a website called Wayback Machine that reveals original drafts of online information.

Of course, few people walk their complaint to the courthouse anymore for filing. That too is done electronically. Today, the only place one can find an IBM Selectric II is perhaps at a yard sale or in a Smithsonian Institution warehouse. The skilled typist, whose hands once danced on typewriter keyboards, are no longer necessary for big litigation. Lawyers can research, draft, edit, and file their pleadings directly from the confines of a tiny laptop computer, even while sipping coffee at the neighborhood coffeehouse.

The opportunities for young lawyers to hang a shingle and be a voice for the voiceless are almost infinite. The overhead of having a law library, a secretary, or a runner to file papers in court has vanished. Even where cases require more than one lawyer so that legal thought can be second-guessed, practice norms have changed. Today, smaller firms and solo practitioners join forces for a case or joint venture with other firms. Because individual lawyers can now represent those in need without the support of a big enterprise, training individual lawyers to put together and litigate cases is an even more empowering endeavor. Newly minted lawyers can no longer complain about employment prospects. A licensed law school graduate with the right training should be ready to represent clients. There is currently no dearth of those in need of representation. It is the job of law schools and legal educators to provide lawyers and would-be lawyers with practical skills.

Contemporary litigation is not just about new opportunities, it is also about how we investigate and try cases. Along with advances in technology, the United States Supreme Court has imposed procedural changes that front-load litigation, requiring lawyers to gather fact-specific evidence for the pleading stage. In the Iqbal and Twombly decisions, the Supreme Court eliminated the age-old notice pleading standard. After these opinions were issued, plaintiff lawyers feared lacking the necessary information to meet the new standards. Yet, information readily available on the Internet from LinkedIn, Facebook, Instagram, Twitter, and chat rooms continually provides data and information to would-be litigants before discovery even begins. Company policies, government standards, and the standards of well-known oversight entities like the Joint Commission of the Accreditation of Hospitals need not be accessed through a trip to the library and searching the stacks: they can be pulled up on an iPhone while watching a baseball game.

In his autobiography, My Life in Court, the great trial lawyer Louis Nizer talked about litigation as a game of probability. Witnesses are put on the stand and testify to an event or chain of events. While their testimony may be truthful, it may not be accurate. Memories are flawed and witnesses view events from a particular vantage point, often not incorporating a scene’s entirety.

One wonders if Nizer—who passed away in 1994—would view things differently today. iPhone videos, photographs, audio recordings, and emails memorializing real-time recollections eliminate jury guessing games and reduce the need for witnesses. Does counsel really need eyewitness testimony of a car accident also captured on an iPhone? In a theoretical sense, just as automation has taken workers off the production line, technological innovation has taken witnesses off the stand.

To keep up with the times, we need to adjust teaching methods. Trial advocacy programs often start by teaching students the art of direct and cross-examination, followed by openings and closings. Why not begin training by requiring that students try cases using only documents, videos, photographs, and audio recordings? This forces students to learn the evidentiary rules of relevance, hearsay, and authentication as well as the art of openings and closings. For their first mock trial, prohibit students from calling witnesses; make them try the case using non-testimonial evidence. Then have them retry the same case with witnesses. This approach is the legal equivalent of the basketball coach making players practice with their weak hand or the ice hockey coach having players scrimmage with their sticks turned upside down.

Forcing students to focus on exhibits also teaches them how to select, or better yet de-select—perhaps from a trove of electronic information—exhibits that nail the case. In an era of abundant information, the skill of exhibit de-selection is critical to avoid going down a rabbit hole and losing the decision maker.

Front-loaded litigation, caused by pleading rules changes, requires that students think about evidentiary rules during case development and investigation. Here are some rules to stress:

  • FRE 201 (Judicial Notice of Adjudicative Facts). So much available online information meets FRE 201 requirements. Challenge those in trial advocacy programs to look outside the case file for industry standards or other usable evidence. This not only teaches students about the rule, it encourages curiosity, creativity, and thinking outside the box.
  • FRE 801(d)(2) (An Opposing Party’s Statement). Simply teaching students about opposing party statements is not enough. In an age when opposing party statements are common, students must also learn this rule’s broad utility. Think about emails, PowerPoint presentations, LinkedIn, Facebook, and Tweets.
  • FRE 901 (Authenticating or Identifying Evidence) and FRE 902 (Evidence that is Self-Authenticating). Teach students that if evidence is one, relevant under 401; two, not excluded under 403; three, not hearsay under 801(d); or four, meets a hearsay exception under 803, then the 901 and 902 authentication rules are the gateway for presenting evidence without a witness in court. FRE 902(13) and (14) even contemplate the mechanisms to authenticate electronic data.
  • FRE 1006 (Summaries to Prove Content). In an age of more information than we know what to do with, consider FRE 1006 the “sleeper” of the Federal Rules of Evidence. It allows the presentation of data summaries to the court and/or the jury. Remember the movie The Rainmaker where the young lawyer, played by Tom Cruise, presents Great Insurance Company’s CEO with a foot-thick computer run of wrongfully denied claims? FRE 1006 permits summary usage in lieu of burdening the jury with a multitude of documents detailing the same thing. FRE 1006 may also eliminate the need for expert testimony from economists and accountants who will do nothing more than summarize and add up numbers.

Most importantly, we as teachers need to keep up with changes, adjust our methods, and maintain student engagement.


Reuben Guttman is a founding partner of Guttman, Buschner & Brooks, PLLC, in Washington, D.C. Read more of his On the Rule of Law columns here.

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Litigation in the age of the Internet

Top trial lawyer Reuben Guttman considers the use of emails and social media postings as evidence and how it is changing the nature, and possibly the outcome, of cases.

On the morning of 18 December 2015, the New York law firm of Kaye Scholer still had not taken off its website the biography of partner Evan Greebel, who, along with Turing Pharmaceutical CEO Martin Shkreli, had been indicted for securities fraud less than 24 hours earlier by the US Attorney for the Southern District of New York. By sundown, the biography was gone. Those wanting to learn about Mr Greebel could still view his LinkedIn page, which showed one ‘endorsement’ for his skill in private equity. That endorsement came from none other than Martin Shkreli.

For his part, Mr Shkreli’s life is more of an open book, with posts on LinkedIn, Facebook and Twitter and lengthy livestreams on YouTube. His LinkedIn page shows endorsements from approximately 100 individuals, whose detailed biographies also appear on the site. His tweets and retweets are revealing. Re-tweeting Bloomberg Press on 16 December, Mr Shkreli posted: ‘Wu-Tang loving Turing CEO Martin Shkreli is really good at short selling.’ Re-tweeting XXL Magazine on the same day, he wrote: ‘Martin Shkreli, who paid $2 million for the secret Wu-Tang album, says he’ll bail Bobby Shmurda out of jail.’ Now there’s an irony!

The New York office of the Federal Bureau of Investigation also cannot resist social media; it too has a Twitter account. On 17 December, it posted: ‘BREAKING: no seizure warrant at the arrest of Martin Shkreli today, which means we didn’t seize the Wu-Tang Clan album.’

Not hip enough to have heard of Wu-Tang? No problem, Wikipedia can tell you that it the Clan is an American hip hop band from New York. By the way, the band also has a Twitter account. And Bobby Shmurda? He’s a rapper from Brooklyn whose biography is on Wikipedia and who, like Shkreli, tweets whatever comes to mind.

With about one hour of internet surfing, an FBI agent can come up with a list of witnesses to interview, gain insights into the mind-set of criminal targets and even get a rough sense of who is communicating with whom. In the age of the Internet, the lives of witnesses and targets are to a certain extent an open book.

Federal agents undoubtedly looked at this very public information when crafting document subpoenas and conducting witness interviews, which allow penetration well below the surface of public banter.  And what do the document subpoenas turn up? Thumb drives loaded with emails!

Undoubtedly, it is the communications memorialised in emails that allowed the Justice Department to craft a detailed indictment alleging the who, what, when, where, and how of the criminal conduct. In a federal district court in the US, emails transmitted by a ‘party opponent’ (in this case the defendant) can be admitted into evidence as long as they are authentic, which means that they are what the purport to be: true and correct copies of the emails.  In US v. Shkreli, it is possible that federal prosecutors can make the case on the documents alone. Electronic communication and social media memorialise events in real time and statements made in these communications can be more insightful and convincing to a jury than oral testimony recollecting prior events. Times have changed since the days when handwritten drafts were given to a cleric to type. That process took spontaneity out of the mix.  These days, trial lawyers comb through electronic databases reviewing emails that have not been filtered through drafting and editing. It is an age where we say what is on our mind, press a button and transmit information with typos, wit, and sometimes wisdom, but always with stream of consciousness. The ability to use emails as evidence is perhaps only second to playing recordings of verbal or videotaped exchanges. For the attorneys and investigators in US v. Shkreli, it is just another day litigating in the age of the Internet.

Reuben Guttman is a prominent trial lawyer and founding partner at Washington, DC-based firm Guttman, Buschner & Brooks.

Article also available at The Global Legal Post.

This article is Part I of a series. Learn More at the National Institute for Trial Advocacy.

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Democracy Misconceived

By William Nettles and Reuben Guttman

There is a misconception among many that democracy and freedom are synonymous and that freedom, in turn, equates to the right to do and say anything.

The White House recently issued an Executive Order and a Memorandum setting a course toward deregulation; this misconception may explain why initiation of plans for the scrapping of rules – actually promulgated pursuant to laws passed by Congress — may seem as American as the Boston Tea Party. Yet, merely having the optics of consistency with American values does not mean that the President’s plans are – in truth – consistent with our sacred rule of law.

Read the full article here.

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