Department of Health and Human Services, Food and

B-251141 May 03, 1993 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Concerned that the employees may have engaged in insider trading. A number of the employees are employed in FDA's Office of Public Affairs and were responsible for answering public inquiries about routine FDA business. The requests for representation were not referred to Justice. All investigations of the employees have concluded and no finding of criminal misconduct has been made. Are generally precluded from using appropriations to hire attorneys to represent employees. Or an officer or employee of an agency is either a party or has an interest in the litigation. 5 U.S.C. Justice provides for the defense of the employee when the actions at issue appear to have been performed within the scope of the employee's duties and Justice determines that providing representation would be in the government's interest. 28 C.F.R. View Decision Matter of: Department of Health and Human Services, Food and Drug Administration - Reimbursement of Employees for Private Attorney Fees Incurred in Federal Criminal Investigation File: B-251141 Date: May 3, 1993 In the absence of Department of Justice approval, agency appropriations may not be used to reimburse federal employees for private attorney fees incurred incident to a federal criminal investigation. DECISION The Department of Health and Human Services (HHS), Food and Drug Administration (FDA), has requested our opinion on whether agency appropriations may be used to reimburse FDA employees for private attorney fees incurred incident to a federal criminal investigation. For reasons set forth below, we conclude that, in the absence of Department of Justice (Justice) approval, HHS appropriations may not be so used. FDA should refer the employees' requests to Justice. BACKGROUND During the course of an investigation of a California investment firm, the Securities and Exchange Commission (SEC) found the names and business telephone numbers of several FDA employees in the firm's business records. The SEC, concerned that the employees may have engaged in insider trading, relayed this information to the HHS Office of the Inspector General and the United States Attorney for the District of Maryland. Both offices conducted separate investigations to determine whether these employees had provided confidential product approval information to the firm, and the U.S. Attorney convened a grand jury. The employees, asserting that the investigation focused on acts that fell within the scope of their employment, requested legal representation by the HHS Office of General Counsel. A number of the employees are employed in FDA's Office of Public Affairs and were responsible for answering public inquiries about routine FDA business. They claimed that they had responded only to routine inquiries from the investment firm. The Office of General Counsel denied the requests on the ground that the criminal investigation raised potential conflicts of interest between the employees and HHS. The requests for representation were not referred to Justice. Subsequently, the employees retained private counsel. The Inspector General found that six of the employees had improperly disclosed information, although without criminal intent. None of the employees has been disciplined. The grand jury did not indict any of the employees. All investigations of the employees have concluded and no finding of criminal misconduct has been made. HHS recommends reimbursement of the attorney fees, ranging from $3,000 to $6,000, because no civil or criminal charges resulted from the investigations and, as it turned out, the matters at issue concerned the performance of agency functions. DISCUSSION Agencies, other than Justice, are generally precluded from using appropriations to hire attorneys to represent employees; federal law reserves the conduct of litigation to Justice where the United States, an agency, or an officer or employee of an agency is either a party or has an interest in the litigation. 5 U.S.C. Sec. 3106; 28 U.S.C. Sec. 516 (1988). Justice provides for the defense of the employee when the actions at issue appear to have been performed within the scope of the employee's duties and Justice determines that providing representation would be in the government's interest. 28 C.F.R. Sec. 50.15(a) (1990). In limited circumstances, where Justice determines that representation of a federal employee is appropriate but is unable to provide representation, agency appropriations may be used to pay for legal work that Justice determines to be in the government's interest. 50 Comp.Gen. 408, 412-413 (1975); 28 C.F.R. Sec. 50.16(d)(1). Justice representation generally is not available in federal criminal proceedings. 28 C.F.R. Sec. 50.15(a)(4).