Stand by...

You're about to be redirected to

July 05, 2005

Implications of Andersen decision for assns

Hopefully you'll never find yourself in this predicament, but I wonder what the recent Supreme Court ruling that overturned the Arthur Andersen conviction will have on associations? In a nutshell, on June 1, the Supreme Court announced its ruling that Andersen had been wrongly convicted of obstruction of justice charges (as you recall, the government asserted that Andersen had conspired to destroy evidence ahead of an impending SEC investigation into the Enron debacle). Andersen appealed the ruling, arguing that they were simply carrying out their standard document retention (and destruction) policy. The Supreme Court exonerated Andersen, overturning the lower court's decision.

In preparing for the CAE exam, you learn that the moment you become aware of an impending anti-trust investigation, you immediately abandon your standard document destruction policy. The risk, they say, is that the association could be suspected of intentionally destroying evidence which would bolster the accuser's case.

In light of this Supreme Court decision, I wonder if new advice will be forthcoming for associations with regards to document destruction? The law firms Venable, LLP and Pillsbury Winthrop Shaw Pittman in DC, which frequently contribute to ASAE on association legal issues, haven't addressed the topic yet, to my knowledge.

No comments: