Abstract
This Article identifies and critiques “incentivized delegation,” an enforcement regime in which the Department of Justice (DOJ) conditions prosecutorial leniency on corporations’ completion of specified, prosecution-oriented, internal investigations of employee misconduct. While courts readily find state action when the government formally delegates investigative functions, they have not squarely addressed whether corporate investigations undertaken to secure prosecutorial leniency—without explicit governmental direction—should likewise trigger state-action scrutiny. United States v. Coburn illustrates the blind spot: by insisting that state action requires overt governmental direction and control, the decision exposes a fundamental failure to appreciate how the government can embed investigative mandates within the conditions of discretionary benefits—thereby shifting core public enforcement duties onto private actors without ever issuing an explicit command.
This Article offers the first sustained, dual-doctrinal critique of incentivized delegation and the DOJ’s Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP). It reconstructs the state-action doctrine to capture corporate investigations structured by leniency conditions and extends the unconstitutional-conditions analysis to the tripartite government-corporation-employee control model. Two constitutional defects follow. First, by conditioning leniency on prosecution-oriented corporate investigations, the government effectively enlists corporations to gather incriminating evidence while avoiding the constitutional constraints that bind the state, jeopardizing employees’ Fifth Amendment privilege against self-incrimination.
Second, the CEP channels regulatory effects through conditions on leniency rather than through statutes, notice and-comment rulemaking, or adjudication, bypassing the Constitution’s ordinary channels for imposing binding obligations on private parties. The consequence is clear: courts should subject incentivized delegation to state action and unconstitutional-conditions scrutiny, with corresponding limits on evidence gathering and policy-driven cooperation demands. Recognizing incentivized delegation as an exercise of state power closes a widening constitutional gap at the center of modern white-collar enforcement.
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