Just when you thought you'd be hearing no more about Arthur Andersen LLP, the U.S. Supreme Court overturned the accounting firm's conviction in May. In 2002, Arthur Andersen had been convicted for obstruction of justice after shredding documents related to Enron and its finances--suspiciously close to a government inquiry. That conviction led to the collapse of the accounting firm.
The Supreme Court ruled that the federal judge in Houston gave overly broad instructions to the jury on determining guilt, and ruled prosecutors should have had to prove that the firm actually intended to break the law.
One key issue was Arthur Andersen's contention that destroying Enron documents was merely in keeping with its own document retention policy. But the firm hadn't applied its policy consistently.
"The take-away is that every company should have a document retention policy and use it," says William Mateja, a Washington, DC, attorney who specializes in white-collar criminal defense. "You can't just dust it off on the eve of illegality."
If your company doesn't have a document retention policy in place, ask your lawyer how to create one--then be consistent in following it. And if you have documents that might become damaging evidence in litigation, you're better off keeping them than sending them to the shredder.
Jane Easter Bahls is a writer in Rock Island, Illinois, specializing in business and legal topics.