Written by Matthew V. Daly, Esq.
Edited by Janeen B. Koch, Esq.
“Parallel proceedings” are two legal proceedings arising out of a single set of facts, ongoing simultaneously –civil, criminal, or administrative. A common example in the liability world is a defendant in a car accident suit that is simultaneously pursuing his own claim for injuries sustained in the same accident. Such a scenario, and all others involving a parallel proceeding, requires the insurer and defense counsel to work together to make certain the insured’s interests in both proceedings are adequately protected.
While all parallel proceedings present unique challenges, a particularly sensitive set of issues arises when the defendant in a civil case faces a simultaneous criminal prosecution arising from the same incident. Thanks to the Sixth Amendment guarantee to a speedy trial, in many cases, any criminal charges arising from the same incident are fully adjudicated by the time civil litigation begins. However, it is entirely possible for a criminal prosecution to extend well into the discovery phase of a civil case, particularly in cases involving more serious charges (e.g., hit and run, driving under the influence, manslaughter). In those instances, the civil discovery can be a source of valuable information to the criminal prosecution – possibly including damaging party admissions by the defendant – all of particular interest to prosecutors hamstrung by the more limited criminal discovery rules.
The defendant may be able to protect himself by invoking his Fifth Amendment privilege against self-incrimination in the civil case. The Fifth Amendment provides, in part, “[n]o person…shall be compelled in any criminal case to be a witness against himself;” this protection against self-incrimination applies in all legal proceedings. However, if a defendant is not careful to properly invoke that privilege in his civil case, even if the defendant plans to assert his Fifth Amendment privilege in the criminal proceedings, damaging testimony from the civil case could be used against the defendant in the criminal case. Determining how to assert that privilege in the civil case is therefore paramount to ensuring that the civil discovery does not negatively impact the criminal prosecution.
The party defending against simultaneous civil and criminal allegations cannot make a blanket refusal to participate in the civil litigation, or make a blanket claim of Fifth Amendment protection, to avoid giving testimony in the civil matter. Rather, the Fifth Amendment privilege must be specifically claimed on each particular question – whether the question is posed in written discovery or in oral testimony. The privilege is not so narrow as to only apply to the direct question of whether the defendant committed a particular crime. North American Mortgage Investors v. Pomponio, 291 Va. 914 (1979). However, to sustain the privilege, it must be evident from the question and its context that a substantive answer would furnish a “link in the chain of evidence” that could lead to prosecution. Id., See also, Edgar v. Edgar, 44 Va. Cir. 191 (1997). The Fifth Amendment privilege can be claimed by a simple statement that clearly identifies the defendant’s intention, such as: “the defendant refuses to answer the question and asserts his Fifth Amendment Privilege against self-incrimination.” The defendant’s attorney may assert the privilege on behalf of the defendant, and should be ready to do so should the issue arise in a deposition, hearing, or trial.
Because the Fifth Amendment privilege can be waived (although a waiver in one proceeding does not constitute a waiver in the other), caution is required from the outset to ensure that the defendant does not relinquish the privilege. Virginia courts are unlikely to deem a denial in pleadings to constitute a waiver. See, e.g., Helmes v. Helmes, 41 Va. Cir. 277 (1997). However, substantive responses in written discovery or oral testimony relevant to the criminal allegations can certainly constitute a waiver. If the privilege is deemed to have been waived, the defendant would be precluded from asserting his Fifth Amendment privilege later on in the litigation, and thus could be compelled to testify.
In many civil/criminal parallel proceedings, the criminal trial will occur long before the end of discovery in the civil proceedings. In that scenario, the defendant invoking his Fifth Amendment privilege may be able to simply obtain an extension of time to fully respond to all discovery; the defendant can agree to fully respond to discovery requests after the criminal trial when the threat of incrimination is extinguished. However, in exceptional circumstances, particularly if it appears that the criminal prosecution may extend near or even beyond the end of discovery in the civil litigation, defense counsel should seek a stay of the civil proceedings. Whether such a request is granted depends on the particular circumstances of each case, but the request is worthwhile where the civil litigation is substantially hampered by the defendant invoking his constitutional rights. See United States v. Kordel, 397 U.S. 1 (1970).
Proceeding to trial in the civil case while the criminal case is ongoing is troublesome because, unlike in a criminal case, a civil jury may be permitted to make an adverse inference based on defendant’s refusal to testify (Virginia Model Jury Instruction 2.080 states: “[i]f you believe that a party, without explanation, failed to call an available witness who has knowledge necessary and material facts, you may presume that that witness’s testimony would have been unfavorable to the party who failed to call the witness”).
The foregoing is only a cursory review of one issue presented in parallel proceedings. Fifth Amendment jurisprudence is a robust and nuanced area of law, and each case must be examined individually. However, in every claim it is important for the insurer, and defense counsel once retained, to ascertain the nature of any pending criminal charges. If the insured is facing charges, claims handlers and counsel should work directly with the insured’s criminal counsel to find out the circumstances of the prosecution and determine the best course of action for protecting the insured. As always, do not hesitate to contact KPM Law with specific questions.