With so much happening during the holidays, who wants to think about preventive steps and corporate compliance? Unfortunately, expansion of New York’s “whistleblower protection” laws coupled with the ongoing pandemic-related return to work issues make it increasingly critical for employers to ring in the New Year with an understanding of these new developments. High on the list of to do’s should be creating an effective “whistleblower” program, that includes an internal reporting process for employees as well as, in some instances, for independent contractors.

Recently, for example, New York Governor Hochul signed legislation expanding coverage of Labor Law 740, a whistleblower law, by including employees as well as former employees and independent contractors. This law goes into effect on January 26, 2022. The “old” law provides protection from retaliation to employees who: 1) disclose or threaten to disclose to a supervisor or a public body an activity, policy or practice of the employer that violates a law, rule or regulation or creates a danger to public health and safety; 2) provide information to or testify before any public body conducting an investigation, inquiry into the employer’s violation; or 3) object to or refuse to participate in the activity or policy that violate the law. The new legislation expands protection to individuals “who report or threaten to report any activity that they reasonably believe is in violation of law, rule or regulation.” The amendments further clarify the definition of “law, rule or regulation” includes any state, local, and federal law, rule, and regulation, as well as any judicial and administrative decisions.

If a person intends on providing information to a public body, the amendments only require that the individual “in good faith reasonably believes” the activity has or will occur, and that the person “in good faith reasonably believes” the activity is an illegal business activity. Notably, there is no requirement that the person provide notice to the employer. This is a different standard of what may constitute protected activity under the current statute.

The changes to the law provide broader protections, including an expanded definition of retaliatory action, a longer statute of limitations, entitlement to jury trials and additional remedies. In addition, the law requires employers to inform employees of these rights and protections by way of a so-called “Section 740 Notice,” that is placed in a “well-lighted” and easily accessible area frequently populated by employees. https://www.litigatorsatwork.com/2021/12/employee-whistleblower-protections-expanded-under-new-york-labor-law-section-740/. Given these developments, employers should consider what strategies need to be implemented in 2022 to minimize risk and litigation.

To begin preparing for the expanded remedies available under whistleblower protection laws that are comparable to New York’s, we recommend that employers review and consider updating the company’s “internal reporting” policy. Beyond that, we recommend employers review, bolster, and/or develop the key elements of their effective “whistleblower” program which are:

  • Top Leadership Commitment and Support
  • Management Responsiveness
  • Internal Reporting System, With Alternative Systems
  • If appropriate, External Reporting System
  • Training on the Process
  • Assurance of No Retaliation to persons who make reports
  • Regular Audit or Review of Process To Determine Effectiveness
  • Continuous improvement and development of a Culture of Trust and Compliance

As you can see, even with the pandemic on everyone’s mind — updating or creating an effective “whistleblower” program is an important New Year resolution. On that note, best wishes for a happy and healthy New Year!

Please contact a Jackson Lewis attorney, including attorneys in our Corporate Governance and Internal Investigations practice group, with questions regarding legal developments and best practices in this expanding area.

Fiscal Year 2021 was a record year for the Whistleblower Program (the “Program”) of the U.S. Securities and Exchange Commission (the “SEC” or the “Commission”). The Commission released its 2021 Annual Report to Congress (the “Report”) last Monday and it reflects substantial increases in many different metrics. The Program has already awarded more than $1.1 billion to over 200 individuals who provided “high quality information” in successful enforcement actions of the SEC and other agencies since its inception a decade ago. FY2021 marked the highest number of awards to both the number of individuals and in dollar amounts awarded. Awards totaling approximately $564 million were made to 108 individuals in FY2021. This exceeds a total of $562 million paid to 106 people combined since the Program’s beginning. These totals included three of the largest awards ever in the history of the Program: two awards of $114 million (one to two individuals; the second to a single whistleblower) and a $50 million award to joint whistleblowers.

Additionally, the past year included the largest number of whistleblower tips ever received. Tips rose approximately 76% to over 12,200; this is up from 6,911 in total from the prior year. This increase included an almost tripling of reports of market manipulation from 942 in FY2020 to 3,090 in FY2021. Reports relating to corporate disclosures and financial and offering fraud were the second and third largest types of allegations asserted.

Approximately 60% of award recipients were current or former insiders of the entity about which they reported. Of those, over 75% had previously raised their concerns internally through various methods or were aware that the violations were known within the company before approaching the Commission as a whistleblower.
Further, the international range of the whistleblower program was strengthened. Successful whistleblowers recognized by the Commission originated from six continents, with approximately 20% of the meritorious claimants in FY2021 based outside the United States. Domestically, California far exceeded other states and territories as the location of 1,006 of the total 6,470 tips submitted from the United States.

The Report emphasized that the Office of the Whistleblower views anti-retaliation protections as “a high priority” to ensure reports are made to the Commission with no fear of reprisal. Exchange Act Rule 21F-17(a) is cited to note that “[n]o person may take any action to impede an individual from communicating directly with the Commission staff about a possible securities law violation, including enforcing, or threatening to enforce a confidentiality agreement . . . with respect to such communications.” To date, the Report mentions that 14 enforcement actions or administrative proceedings have been brought by the Commission involving violations of this Rule. These included actions in FY2021 that focused on prohibitions noted in compliance manuals, training materials, settlement releases and confidentiality and separation agreements.

Emily Pasquinelli, Acting Chief, Office of the Whistleblower, stated in the Report that these noted successes “demonstrates that [the Program] is a vital component of the Commission’s enforcement efforts” and exhibited her hope that continued awards would “enhance the agency’s ability to detect wrongdoing and protect investors and the marketplace.”

To review the full Report, see 2021 Annual Whistleblower Program Report to Congress (sec.gov)

The question of whether the False Claims Act (FCA) requires a showing of objective falsity will continue to divide the circuit courts following the U.S. Supreme Court’s decision not to address the issue.

To establish liability under the FCA, which prohibits the defrauding of the government, an individual must demonstrate actual knowledge that the claim in question was false or deliberate ignorance or reckless disregard of the truth or falsity of the claim.

The circuit courts are split as to whether or not “actual knowledge” under the FCA requires that an allegedly false claim be based on objectively verifiable facts.

In United States v. AseraCare, Inc., 938 F.3d 1278 (11th Cir. 2019), the Eleventh Circuit held that falsity under the FCA, in fact, requires objectively verifiable proof that the claim was false, and that subjective opinions of physicians, without more, are insufficient to establish the falsity of a claim under the FCA.

The Eleventh Circuit’s rationale was rejected by both the Third Circuit and the Ninth Circuit, both of which did not require objective proof of falsity. In United States ex rel. Druding v. Druding, 952 F.3d 89 (3d Cir. 2020), the Third Circuit held that a claim for reimbursement for Medicare Hospice Benefit could be considered “false” under the FCA on medical-expert testimony that accompanying patient certifications did not support patients’ prognoses of terminal illness. Similarly, in Winter ex rel. United States v. Gardens Reg’l Hosp. & Med. Ctr., Inc., 953 F.3d 1108 (9th Cir. 2020), the Ninth Circuit held that a false certification of medical necessity could be sufficient to give rise to FCA liability, and a false certification of medical necessity could be material under the FCA.

On February 22, 2021, the U.S. Supreme Court declined to grant certiorari on whether objectively verifiable facts are required to establish liability under the FCA, thereby leaving the ongoing circuit split intact on the issue of “objective falsity.”

While healthcare providers, government contractors, and other organizations have long been aware of the factual specificity and complexity often underlying FCA claims, the Supreme Court’s denial to decide the issue of “objective falsity” is an important development for organizations engaging in activities covered by the FCA. Employers and other organizations must remain educated and vigilant and understand that they may continue to face varying levels of exposure risk to liability under the FCA, depending upon not only the specific circumstances surrounding the allegedly false claim in question, but also the jurisdiction where the FCA case is brought.

Please contact a Jackson Lewis attorney, including attorneys in our Corporate Governance and Internal Investigations practice group, with questions regarding this development and the FCA.

On September 30, 2020, California Governor Gavin Newsom signed a bill into law requiring publicly held corporations to further diversify their boards of directors. He also signed a bill requiring that corporations and limited liability companies make additional disclosures.

Assembly Bill 979 (AB 979) adds Section 301.4 to the California Corporations Code. This Section requires corporations to have at least one director from an underrepresented community on their boards of directors by the close of the 2021 calendar year, with increases the following year for boards of certain sizes. Under the law, “‘[d]irector from an underrepresented community’ means an individual who self-identifies as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, or Alaska Native, or who self-identifies as gay, lesbian, bisexual, or transgender.” A corporation may increase the number of directors on its board to comply with the law. The law applies to publicly held domestic or foreign corporations with principal executive offices in California. For more on AB 979, see: https://www.californiaworkplacelawblog.com/2020/09/articles/diversity/ab-979-requires-california-based-publicly-held-corporations-to-diversify-their-boards-of-directors/

Assembly Bill 3075 (AB 3075) requires a corporation or limited liability company to disclose whether any officer or any director (or any member or manager, if a limited liability company) has an outstanding final judgment issued by a court or California’s Division of Labor Standards Enforcement for violation of the California Labor Code or any wage order. The new disclosure requirement will take effect no later than January 1, 2022, and possibly sooner as set forth in the law. For more on AB 3075, see: https://www.californiaworkplacelawblog.com/2020/10/articles/california/new-requirements-for-corporations-statement-of-information/

If you have questions about the effects of these or other recent legislation, please contact a Jackson Lewis attorney to discuss.

The Securities and Exchange Commission has voted to adopt numerous amendments to the rules governing its whistleblower program. See https://www.sec.gov/news/press-release/2020-219

The whistleblower program serves as a significant tool for the Commission to encourage individuals to come forward with information regarding suspected security fraud. As set forth in the SEC’s press release, “The amendments to the whistleblower rules are intended to provide greater transparency, efficiency and clarity, and to strengthen and bolster the program in several ways.”

Notably, the SEC Chairman Jay Clayton stated the “rule amendments will help us get more money into the hands of whistleblowers, and at a faster pace.” Chairman Clayton further stated, “Experience demonstrates this added clarity, efficiency and transparency will further incentivize whistleblowers, enhance the whistleblower award program and benefit investors and our markets.” Given the emphasis on incentivizing whistleblowers, employers may see an uptick in whistleblower activity.

The SEC’s press release contains a list of amendments, as well as a link to the Final Rule. Highlights taken from the SEC’s press release include:

  • Awards:
    • “For awards where the statutory maximum award amount for the covered action and any related actions is in the aggregate $5 million or less, the Commission is adding Exchange Act Rule 21F-6(c) to provide a presumption that the Commission will pay a meritorious claimant the statutory maximum amount where none of the negative award criteria specified in Rule 21F-6(b) are present, subject to certain limited exceptions.”
    • “For awards over $5 million, the Commission will continue to analyze the award factors identified in Rule 21F-6 and issue awards based on the application of those factors. Based on the historical application of the award factors, if none of the negative criteria specified in Rule 21F-6(b) are present, the award amount would be expected to be in the top third of the award range.”
  • Whistleblower Definition:
    • “In response to the Supreme Court’s decision in Digital Realty Trust, Inc. v. Somers, the Commission is modifying Rule 21F-2 to establish a uniform definition of “whistleblower” that will apply to all aspects of Exchange Act Section 21F—i.e., the award program, the heightened confidentiality requirements, and the employment anti-retaliation protections.”
      • “For purposes of retaliation protection, an individual is required to report information about possible securities laws violations to the Commission “in writing.” As required by the Supreme Court’s decision, to qualify for the retaliation protection under Section 21F, the individual must report to the Commission before experiencing the retaliation.”
      • “To be eligible for an award or to obtain heightened confidentiality protection, the additional existing requirement that a whistleblower submit information on Form TCR or through the Commission’s online tips portal remains in place, subject to the additional discretion of the Commission to grant waivers described below [in the Press Release].”
      • “Additionally, the Commission is issuing interpretive guidance defining the scope of retaliatory conduct prohibited by Section 21F(h)(1)(A), which includes any retaliatory activity by an employer against a whistleblower that a reasonable employee would find materially adverse.”
  • Frivolous Award Applications:
    • “To prevent repeat submitters from abusing the award application process, the rule permits the Commission to permanently bar any applicant from seeking an award after the Commission determines that the applicant has abused the process by submitting three frivolous award applications.”
    • “For the first three applications determined to be frivolous, the Office of the Whistleblower will notify a claimant of its assessment and give the claimant the opportunity to withdraw the application.”

For a more comprehensive list of amendments, as well as a link to the Final Rule, visit https://www.sec.gov/news/press-release/2020-219

Please contact a Jackson Lewis attorney, including attorneys in our Corporate Governance and Internal Investigations practice group, with questions regarding these amendments and the SEC whistleblower program.

The Securities and Exchange Commission (the “SEC”) announced a whistleblower award of more than $27 million, representing the largest SEC whistleblower award of 2020.  This is the sixth largest award overall since the inception of the SEC whistleblower program in 2011.

Congress established the whistleblower program to incentivize whistleblowers to report specific, timely, and credible information about federal securities laws violations to the SEC.  Section 21F of the Securities Exchange Act of 1934 (the “Exchange Act”) entitled “Securities Whistleblower Incentives and Protection,” requires the SEC to pay awards to whistleblowers who provide the SEC with original information about violations of the federal securities laws.  See The Exchange Act at § 240.21F-1.  The award is subject to certain limitations and conditions and the SEC has discretion to increase or decrease the award percentage based on a number of factors in relation to the unique facts and circumstances of each case.  Id. at §§ 240.21F-1, F-6.  The award can range from 10% to 30% of the monetary sanctions the SEC and other authorities are able to collect.  Id. at §§ 240.21F-6.

According to the SEC’s Order Determining Whistleblower Award Claim issued on April 16, 2020 (https://www.sec.gov/rules/other/2020/34-88658.pdf), in determining the award percentage resulting in the award of over $27 million, the SEC determined the whistleblower:

  1. provided significant information that allowed the SEC to uncover hidden conduct, in part, occurring overseas;
  2. provided ongoing assistance and cooperation, including providing documents and investigative leads that advanced the investigation and saved the SEC significant time and resources;
  3. provided information that enabled the SEC to bring an action addressing misconduct that furthered the SEC’s law enforcement interests; and
  4. repeatedly and strenuously raised concerns internally.

The SEC determined that it did not need to reduce the award amount for unreasonable reporting delay because the whistleblower “repeatedly and tenaciously objected to and escalated” concerns about misconduct within the whistleblower’s organization.

Since the first award was issued to a whistleblower in 2012, the whistleblower program has awarded approximately $425 million to 79 individuals.  The largest award—$50 million—was awarded to a whistleblower on March 19, 2018.

With enactment of the CARES Act on March 27, Congress appropriated $2.2 trillion, the largest economic stimulus package in history, to combat COVID-19 and the serious economic damage it has wrought to all facets of the economy. Along with this mammoth government subsidy, however, comes the prospect of unprecedented fraud and abuse in sectors of the economy able to take advantage of the funding.

Businesses able to secure CARES Act relief should consider protecting themselves from the risk that experts believe will be a decade of government investigations. Management decisions being made today about where and how to spend needed government subsidies will be scrutinized later by government regulators and whistleblowers alike.

Observance of in-house compliance programs that companies previously designed and implemented can protect against the risk of a future investigation. As one former federal prosecutor noted, “[I]t’s just critical that those processes not be shunted to the side in the name of keeping the business going.”

The provisions of CARES Act subsidies most susceptible to regulatory oversight and inquiry of waste, fraud, and abuse include:

Small business relief: $350 billion has been made available to companies with no more than 500 employees that maintain payroll are entitled to up to eight (8) weeks of subsidies. Appropriated by Congress to prevent layoffs and closures while employees are home, these funds are available for payroll, mortgage interest, rent, or utilities and will be forgiven if administered correctly.

Large corporation relief: $500 billion is being set aside as loans, guarantees, and related investment for big business with $50 billion specifically earmarked for the airline industry. Loans may not exceed five (5) years, will not be forgiven, and are subject to oversight by the Treasury Department IG.

Hospitals and health care: $140 billion has been appropriated to support the U.S. health system, $100 billion of which will be made directly available to hospitals to fight COVID-19, subsidize costly acute treatments, and compensate hospitals for lost income from elective and routine medical services. Additional funds will be used to enhance PPE stockpiles, expand COVID-19 testing, and increase Medicare/Medicaid subsidies during the pandemic.

Unemployment/payroll tax relief: The CARES Act affords $250 billion to cover extended unemployment benefits up to four months, plus additional payments of $600 weekly beyond state program subsidies. Employers may delay payment of their portion of 2020 payroll taxes to 2021 and 2022.

Recipients of CARES Act funds outlined above need to be cognizant of the robust oversight and compliance authority with which Congress has empowered different legislative entities. Such mechanisms of executive oversight include:

  • Bipartisan Congressional Oversight Commission;
  • Pandemic Response Accountability Committee (comprised of nine (9) Inspector Generals (IGs) across various government agencies);
  • Special IG for pandemic recovery, SIGPR; and
  • House Speaker seeks administration to appoint a temporary select congressional committee to oversee the beginning stages of the bailout.

Risks attendant to the receipt of bailout funds and their honest, prudent use and administration are linked to the government’s interest of ensuring the money is spent properly. Evident from the myriad of critical government funding opportunities available to employers to address this crisis, likewise, is significant temptation for employee abuse, self-dealing, false claims, and outright theft.

Documenting today’s decision to apply for funding, including the facts and government guidance relied upon, is imperative. Looking to the future, companies should expect the government to scrutinize a company’s decision to accept bailout funds and how those funds were utilized.

Please contact a Jackson Lewis attorney with any questions or concerns about the CARES Act.

The Special Agent in Charge of the Boston office of the FBI, Joseph Bonavolonta, has issued an advisory aimed at alerting and keeping individuals and companies safe in the midst of the COVID-19 pandemic. His memo reported on emerging schemes and frauds being perpetrated by criminals looking to capitalize on the current crisis.

The FBI previously issued an alert to warn government and healthcare industry buyers of rapidly emerging fraud trends related to procurement of personal protective equipment (PPE), medical equipment such as ventilators, and other supplies or equipment in short supply during this time of crisis. https://www.fbi.gov/news/pressrel/press-releases/fbi-warns-of-advance-fee-and-bec-schemes-related-to-procurement-of-ppe-and-other-suppl i es-during-covid-19-pandemic

The latest advisory indicated that law enforcement was seeing an increase in other types of healthcare fraud scams. Apparently, taking advantage of the current stress on the supply chain, fraudsters — acting as vendors — have been promising to sell and deliver equipment they do not have access to in order to capitalize on the urgent need. According to the FBI, suspicious indicators of such fraud may include unusual payment terms (i.e., supplier asking for up-front payments or proof of payment), last-minute price changes, last-minute excuses for delay in shipment (i.e., claims that the equipment was seized at port or stuck in customs), and unexplained source of bulk supply.

Scammers also are utilizing several fraudulent methods to extract personal identifiable information from unsuspecting persons, including robocalls, social media sites, door-to-door promotions, telemarketers, and phishing and malware distributions through digital devices. One approach being used is to pay kickbacks to marketers to obtain personal identifiable information such as Medicare, Medicaid, and private health care insurance identifiers. Once this information is obtained, the subject uses it to submit fraudulent claims to Medicare, Medicaid, and private healthcare insurers for laboratory tests, durable medical equipment, and prescription medications that were never provided.

One specific scam uncovered involved the offering of genetic tests to individuals, to include cancer genomic testing (used to aid in the diagnoses of cancer), and pharmacogenetic testing (used to determine how an individual’s body will react to certain medications). The purported genetic tests are fraudulent or not run at all, and the results were either fictitious or not provided to the patient. The FBI previously released a public service announcement relating to certain healthcare fraud schemes the agency had observed: https://www.fbi.gov/news/pressrel/press-releases/fbi-warns-of-emerging-health-care-fraud-schemes-related-to-covid-19-pandemic

In another piece of cautionary advice, the FBI indicated that the posting of personal health information on social media about receiving a COVID-19 test could make people susceptible to fraud schemes. Individuals may then be contacted by persons claiming to be medical professionals who purportedly are informing them of their positive COVID-19 test results. The caller will request healthcare insurance beneficiary identifiers or credit card numbers under a ruse that they will submit a prescription or mail medication. Of course, the goal is only to obtain personal identifiable information.

Finally, callers posing as physicians may offer telemedicine COVID-19 consultations or COVID-19 tests for individuals who have valid coverage through Medicare or a private healthcare insurer. Frequently, the individuals have no symptoms. Individuals are asked to provide their personal identifiable information, including health insurance identifiers. Those who succumb to this fraud scheme may have their Medicare or private healthcare insurance billed for various medical services that were never provided.

The White Collar and Government Enforcement practice group at Jackson Lewis P.C. is available to advise businesses, employers, and individuals who may have been victimized by a fraud, or who become aware of such unlawful schemes.

The COVID-19 pandemic has had a dramatic impact on the management of organizations, including throwing managers at all levels into an “all-hands-on-deck” reactive mode.  In large measure, the immediate focus of management-level employees has been on business continuity, particularly moving the organization to a work from home workforce, workforce management including reductions in force by way of layoff or furlough programs, and client/customer relations efforts aimed at maintaining the company’s lines of revenue.  As this pandemic continues to impact directly or indirectly companies of various sizes and industries, we anticipate that the board of directors of both publicly traded and privately held organizations will increasingly consider and seek to assess their governance role in addressing, managing through, and disclosing the impact of the pandemic on the company’s ongoing operations, financial results, and general sustainability.  Similar to times of other major crisis, we recommend that company boards remain vigilant and take an active role in the oversight of these organizations during this perilous time.

In the midst of this crisis, the U.S. Securities and Exchange Commission (“SEC”) has emphasized the importance of a company’s disclosure obligations.  Addressing the issue of disclosure, the SEC Division of Corporation Finance issued a CF Disclosure Guidance which states:

The Division encourages timely reporting while recognizing that it may be difficult to assess or predict with precision the broad effects of COVID-19 on industries or individual companies.  We also recognize that the actual impact will depend on many factors beyond a company’s control and knowledge.  Nevertheless, the effects COVID-19 has had on a company, what management expects its future impact will be, how management is responding to evolving events, and how it is planning for COVID-19-related uncertainties can be material to investment and voting decisions.

The Guidance includes a series of questions aimed at assessing the effects of COVID-19 on a company.  These questions, excerpted below, provide a helpful roadmap for questions board members can utilize so as to engage with management about the company’s position and thereby fulfill their governance responsibilities:

  • How has COVID-19 impacted your financial condition and results of operations?  In light of changing trends and the overall economic outlook, how do you expect COVID-19 to impact your future operating results and near-and-long-term financial condition?  Do you expect that COVID-19 will impact future operations differently than how it affected the current period?
  • How has COVID-19 impacted your capital and financial resources, including your overall liquidity position and outlook?
  • If a material liquidity deficiency has been identified, what course of action has the company taken or proposed to take to remedy the deficiency?
  • How do you expect COVID-19 to affect assets on your balance sheet and your ability to timely account for those assets?
  • Do you anticipate any material impairments (e.g., with respect to goodwill, intangible assets, long-lived assets, right of use assets, investment securities), increases in allowances for credit losses, restructuring charges, other expenses, or changes in accounting judgments that have had or are reasonably likely to have a material impact on your financial statements?
  • Have COVID-19-related circumstances such as remote work arrangements adversely affected your ability to maintain operations, including financial reporting systems, internal control over financial reporting and disclosure controls and procedures?  If so, what changes in your controls have occurred during the current period that materially affect or are reasonably likely to materially affect your internal control over financial reporting?  What challenges do you anticipate in your ability to maintain these systems and controls?
  • Have you experienced challenges in implementing your business continuity plans or do you foresee requiring material expenditures to do so?  Do you face any material resource constraints in implementing these plans?
  • Do you expect COVID-19 to materially affect the demand for your products or services?
  • Do you anticipate a material adverse impact of COVID-19 on your supply chain or the methods used to distribute your products or services? Do you expect the anticipated impact of COVID-19 to materially change the relationship between costs and revenues?
  • Will your operations be materially impacted by any constraints or other impacts on your human capital resources and productivity?
  • Are travel restrictions and border closures expected to have a material impact on your ability to operate and achieve your business goals?

The full list of questions, which the Division describes as non-exhaustive, can be found here.  Please contact a Jackson Lewis attorney for assistance with board governance questions or issues.

Several current and former federal officials recently sent letters to the President and the Attorney General urging action to protect persons in custody or facing arrest and detention during the COVID-19 crisis. In response, Attorney General Barr has issued separate directives to all U.S. Attorneys and DOJ Department Heads and to the Director of the Bureau of Prisons (BOP). This guidance comes as justice systems across the United States are dealing with an increasing rate of infection among incarcerated individuals and facility staff, and a flood of petitions seeking early release or reconsideration of orders denying bail.

In his memorandum to DOJ officials on litigating pretrial detention issues during the current health crisis, Barr stressed the “paramount obligation” of federal law enforcement to protect the public from violent offenders, including gang members and child predators, and urged prosecutors to consider the pandemic as a factor in bail determinations. The advisory directs that detention should not be considered “to the same degree we would under normal circumstances – specifically, for those defendants who have not committed serious crimes and who present little risk of flight (but no threat to the public) and who are clearly vulnerable to COVID-19 under CDC Guidelines.” In support, Barr states that each time a new person is added to a jail, it brings the risk of infection to facility personnel and those already incarcerated, as well as serious risk to the health of individuals who may be vulnerable to the virus based on age or a preexisting medical condition.

In a separate memorandum to the Director of the BOP, the Attorney General noted the “significant levels of infection at several of our facilities,” which requires prompt action to address the growing crisis. Acting based on new authority granted to him under the recently enacted CARES Act to address “emergency conditions,” Barr directed BOP to review all inmates, beginning with those at facilities most affected by the spread of COVID-19, to identify those deemed suitable for home confinement and to “immediately process them for transfer,” following a 14-day quarantine at a BOP facility, or at the residence to which the inmate is being transferred. Barr cautioned BOP that, in making these determinations, it “not inadvertently contribute to the spread of COVID-19 by transferring inmates from our facilities.” As he did in the guidance to the U.S. Attorneys, Barr reminded the BOP that it not only has a responsibility to protect those in custody, but an obligation to protect the public and the law enforcement community. He stated that “this pandemic has dramatically increased the already substantial risks facing the men and women who keep us safe,” noting that it is “impossible to engage in social distancing, hand washing, and other recommended steps in the middle of arresting a violent criminal.”

The White Collar and Government Enforcement practice group at Jackson Lewis has attorneys who are former federal and state prosecutors, and experienced criminal law practitioners. The services that we provide include guiding clients through criminal and regulatory investigations, defense of complex criminal cases, sentencing advocacy, pardon petitions, motions for compassionate release, and efforts to seal or expunge criminal records.