February/March 2009 / Cover Story
A Fate Worse than Litigation
A company that is brought before a congressional investigation encounters a process that makes being a defendant in a lawsuit seem relatively benign, according to the author.
“Many of the rules so fundamental to our western legal system do not seem to apply,” he says. There is no right to confront witnesses, little restriction on the evidence that can be used against you, and “prosecutor, judge, and jury are one and the same.”
Congressional investigations often generate other inquiries, and may generate criminal investigations and private lawsuits. Private information may have to be turned over, bad publicity is likely, and direct costs for such things as document production are likely to be substantial and may not be covered by insurance. The hearing is “a media spectacle, often designed for public consumption.”
There are, however, things that a company can do to mitigate the effects of a congressional inquiry or head one off before it starts. Compliance programs are a must, as are legal, public relations and lobbying strategies, and maintaining ongoing relations with members of Congress from key states and committees.
Also keep in mind, the author says, that congressional inquiries “present an opportunity to convey your message, set the record straight, and influence the public debate. Cooperation with Congress is often the best way to maximize that opportunity.”