• Insurance: Responding To Regulatory Subpoenas
  • May 5, 2005 | Authors: Lewis S. Wiener; W. Thomas Conner
  • Law Firm: Sutherland Asbill & Brennan LLP - Washington Office
  • Who can blame insurers for wanting to turn back the clock? From the catastrophic events of September 11 to the 2004 quartet of hurricanes that struck the southeastern United States, immense catastrophes continue to wreak havoc with performance. External risks such as rising tort costs and the failure of medical malpractice reforms create the same sort of daily chaos for corporate counsel. For companies seeking to withstand the legal and business gale winds, the following is a critical issues to take into account as they plan for the months ahead.

    As the insurance industry responds to fast-changing corporate governance and regulatory demands, almost equally quickly, regulatory subpoenas are being served on some of the industry's leading companies. In-house counsel should follow these five "C's" to help their clients respond to a regulatory subpoena:

    Clarify the scope of the subpoena. If you believe it's too broad or exceeds applicable regulatory authority, discuss a possible narrowing. Suggest specific, less burdensome alternatives. Discuss timing of the response, including a possible extension. Agree in advance about the form of production.

    Communicate and explain what the regulator wants. Draft a memo explaining what people need to produce, when the information must be produced and to whom questions should be directed. Identify who must produce documents and be prepared to explain why these individuals were selected. Specify search terms to be used in searching for electronic documents.

    Coordinate document production. Understand your company's information system(s) and the kinds of documents that it has. Questions to ask: Does your company regularly back up/purge files? How often? What is the document retention policy? What are the applicable regulatory requirements?

    Confirm that complete responses were received. If not, why not? It's better to tackle potential problems (like document destruction) early. Understand the scope of any problems and develop solutions that can be suggested to the regulator.

    Copy everything that's produced. This may save time/expense if your company later faces another subpoena and may avoid problems if questions arise regarding the production. Consider "Bates stamping" all documents for future reference.