When the Supreme Court overturned accounting firm Arthur Andersen's conviction for obstruction of justice by destroying documents, it clarified and narrowed the application of one witness-tampering statute to the destruction of documents. However, the Sarbanes-Oxley Act of 2002 added additional witness-tampering provisions that may diminish the effect of the decision. Accordingly, in structuring and enforcing document retention policies, companies should consider not only the witness-tampering provision used in the Andersen prosecution, even if narrowed, but also the new provisions added by Sarbanes-Oxley.
Among the actions that Arthur Andersen took in response to the gradual discovery of Enron's accounting improprieties was that Andersen partners and in-house counsel instructed employees on the Enron engagement team to comply with Andersen's document retention policy. Andersen's policy was unremarkable, calling for retention in Andersen's central engagement file of only such information as is relevant to supporting Andersen's work, but providing that document destruction should stop once litigation is threatened. Andersen personnel complied with the policy by destroying documents related to Enron, even though some members of the Andersen engagement team considered a government investigation probable. Andersen personnel were instructed to terminate document destruction only after Andersen was formally served by the SEC with a subpoena for its records relating to Enron.
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