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Corporate Governance Information Governance and Compliance United States Supreme Court White Collar Crime

The Arrival of Justice Gorsuch May Bring Opportunity to Reform the Collective Entity Doctrine

Recognizing a Fifth Amendment privilege for corporations — whether through wholesale abolition of the collective entity doctrine or by recognizing some limited exception for custodians of smaller corporations — would not foreclose meaningful white-collar prosecutions, but it would restore protection of the Fifth Amendment rights of individuals who are sacrificed under the current bright-line rule. Will Justice Gorsuch help in this endeavor?

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A little over 100 years ago, the Supreme Court declined to extend the Fifth Amendment privilege against self-incrimination to corporations responding to grand jury subpoenas for documents, establishing what has been termed the “collective entity doctrine.” Hale v. Henkel, 201 U.S. 43, 74-76 (1906) (corporate officer, who had been immunized in his individual capacity, attempted to assert Fifth Amendment right on behalf of his employer). Some Justices have expressed discomfort with the application of the collective entity doctrine to small corporations responding to grand jury subpoenas, and recent decisions by the Court have extended First Amendment rights to corporations that had previously been limited to individuals. These developments suggest that the Court, particularly with the arrival of Justice Neil M. Gorsuch, might be receptive to reconsidering the scope of the collective entity doctrine, a rule whose principal virtue seems to be that it is a bright-line, particularly in the context of small, closely-held corporations.

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