Mr Saulnier is a partner in and co-leader of the firm’s global investigations, enforcement and white-collar practice group. Mr Saulnier advises clients on investigation into and defence of bribery and corruption-related matters, focusing on external and internal corporate investigations. He has conducted investigations on five continents, and represents clients in anti-corruption and fraud matters before the DOJ and the SEC, as well as before various authorities outside the USA.
How has the legal market changed since you first started practising?
I have spent my entire legal career at K&L Gates, starting with the predecessor firm, Kirkpatrick & Lockhart, in September 1998. So I tend to view the legal market through that lens – a lawyer working at a law firm. Putting aside (for the moment) the changes likely to arise out of the covid-19 pandemic, I think that one of the larger changes I have observed is client control of the marketplace.
The days of the client community deferring to the same outside counsel time and again are largely behind us. In addition to requiring effectiveness, clients are demanding a higher degree of efficiency and accountability. Legal work is regularly put out to competitive bid through requests for proposal; exacting outside counsel guidelines govern the relationship; detailed budgets must be submitted; and strict, electronic billing practices have been put in place. We have always been a service industry, but these things have really shifted control of the marketplace to the clients.
As a consequence, we need to be nimble. We need to adapt. One way we have done that is to move the firm to more of a business model in its operation and management. Another way we have responded is through our flexible approach to alternative fee arrangements, which means collaborating with our clients to best meet their needs for high-quality legal work delivered efficiently, predictably, and in a cost-effective manner.
Do you anticipate a wave of enforcement activity due to the Coronavirus Aid, Relief, and Economic Security (CARES) Act stimulus packages post-covid-19?
Yes. Though uncertainty has been the dominant theme of the global covid-19 pandemic, one thing is for sure – the CARES Act’s distribution of more than US$2 trillion in stimulus funds is a likely precursor to a new wave of government enforcement actions once the dust settles. We need only to look at the US government’s crackdown following the 2008 Troubled Asset Relief Program (TARP) to know what is likely coming from the enforcers.
The TARP stimulus pumped US$700 billion into a struggling US economy, which was later followed by more than a decade of criminal and regulatory enforcement actions – continuing to this day – resulting in hundreds of criminal convictions and billions of dollars of financial penalties. The CARES Act stimulus dwarfs the TARP stimulus in size and scope, and enforcement activity arising out of related waste, fraud and abuse will likely outpace that of TARP.
How can clients ensure they are prepared to meet the expectations of prosecutors and regulators with regard to operational resilience and robust compliance programmes, despite challenges posed by covid-19?
A company that needs to alter or downsize its compliance function, or divert resources away from proactive compliance measures owing to challenges posed by covid-19, should be prepared to provide a reasonable, risk-based justification for any such decisions if it hopes to benefit from agency discretion if a violation is later discovered.
In fact, during a recent webinar, several senior federal law enforcement officials described how their respective agencies are operating during the global pandemic and tried to set expectations for companies as they navigate shifting economic conditions. Their overall message was clear: despite the challenges posed by the pandemic, their respective agencies remain committed to enforcing the law and holding parties accountable for violations. Although there is no pandemic defence to allegations of fraud or corruption, these officials seemed open to considering the context of the pandemic in evaluating alleged corporate misconduct and claim they will take a reasonable and practical approach given the challenges and disruptions presented by covid-19. With respect to proactive corporate compliance efforts in particular, these officials emphasised the importance of continuing to evaluate risk and the need to maintain effective internal controls despite tightened budgets and reduced resources. Finally, while the officials acknowledged complications in certain aspects of the enforcement process, they made clear that fraud and corruption investigations are moving forward largely unimpeded by covid-19.
How does K&L Gates seek to distinguish itself from its competitors?
One way we distinguish ourselves is through how we are structured and governed. K&L Gates is a fully integrated, five-continent firm, possessing one of the most transparent business models in the legal industry, and adding value by approaching client relationships with a one firm, one team philosophy.
As a globally integrated firm, we can offer efficiencies for clients that other firms cannot. We are one global network, allowing us to provide seamless service to our clients regardless of location. We have a single profit pool, a unitary governance system and a single technology platform. Because of this, we do not compete internally for work and can serve clients who are looking to work with one firm rather than multiple firms. Moreover, we devise more creative legal solutions when we operate seamlessly as a team.
What has been your greatest achievement to date?
Staying employed for over 21 years at the same firm. Shhh. Don’t tell anybody . . .