anton piller orders page 1 civil search warrants: how they are used in fraud cases acfe 2014...

Civil Search Warrants: How They Are Used In Fraud CasesACFE 2014 Canadian ConferenceSeptember 8, 2014

Rosanne Walters, CPA, CA, CFE, CBVMichael Galambos, LLB , BA

Anton Piller Orders

Anton Piller OrdersOverview

Definition and History of the Anton Piller OrderCriteria to obtain the OrderIssues arising from Anton Piller cases in CanadaSupreme Court of Canada guidelines to conduct Anton Piller OrdersConnection with Mareva InjunctionsUse of Anton Piller Orders in recent fraud casesBenefits of Anton Piller OrdersOpportunities for CFEs

Questions and answers

Anton Piller Orders

Anton Piller OrdersDefinition

The Anton Piller Order is a court order that provide the right to search premises and seize evident without prior warning (ex-parte).

Essentially, it is a civil search warrant.

Anton Piller Orders

Anton Piller OrdersFirst Case

Anton Piller KG v. Manufacturing Processing Ltd. (1976)

Anton Piller (a German company) sued Manufacturing (an English sales agent) because of alleged leaks of copyrighted information to competitors. Anton Piller was a major supplier to IBM.

This case established the criteria that must be met to obtain an Order.

Anton Piller Orders

Anton Piller OrdersCriteria

• A strong Prima Facie case

•Misconduct causes serious damage to plaintiff, potential or actual

• Convincing evidence that the defendant has in it possession documents or information that is incriminating

•A real possibility, factually demonstrated, that the defendant may destroy such material before the discovery process can do its work in the normal course of civil litigation

Anton Piller Orders

Anton Piller OrdersPrima Facie Evidence

Prima Facie means..“At first appearance”

It does not need to be conclusive or irrefutable. Just strong enough to warrant going to trial.

In the original Anton Piller case, the Prima Facie evidence was evidence that two agents of the Defendant were corresponding with competitors about the copyrighted information.

Anton Piller Orders

Anton Piller OrdersDamages

Damages to the Plaintiff must be serious.

In the original Anton Piller case, there was a huge possibility that there would be damages if competitors obtained copyrighted information, especially at the time Anton Piller was going to market with some new innovations.

Anton Piller Orders

Accounting RecordsPossession of Evidence

There must be convincing evident that the Defendant has in its possession incriminating evidence.

In the original Anton Piller case, the evidence suggested that the Defendant had correspondence and other evidence to support the sharing of copyrighted information with German competitors.

Anton Piller Orders

Anton Piller OrdersDestroy Evidence

There must be a real possibility that the Defendant may destroy evidence.

In the original Anton Piller case, it was determined that there was grave danger that the evidence of providing information to competitors would have been destroyed if notice of the application was given.

Anton Piller Orders

Anton Piller OrdersIssues Arising from Anton Piller Orders in Canada

•Privacy issues when a search occurred in a home

•Dealing with privileged documents

•List of contents removed from premises was not itemized

•Documents lost or destroyed after the Order carried out

•Subsequent litigation arose due to privileged documents

Anton Piller Orders

Anton Piller OrdersGuidelines established by the Supreme Court for conducting Anton Piller Orders

•Normal business hours

•Defendant needs to be present during the search

•People who conduct the search should be specified and limited in number

•A copy of claim should be serviced on Defendant

•Defendant has right to contact a lawyer

Anton Piller Orders

Anton Piller OrdersGuidelines established by the Supreme Court for conducting Anton Piller Orders (continued..)

•A detailed list of evidence removed should be made

•Documents seized should be placed in the custody of a Supervising Solicitor and the Defendant should have an opportunity to review them

•Contested evidence should be kept in the Supervising Solicitor’s custody

Anton Piller Orders

Anton Piller OrdersRole of Supervising Solicitor during the search

•Act neutral

•Explain the Court’s Order to the Defendant

•Supervise the search for and seizure of evidence

•Objectively report to the Court

•Aid the Court and counsel for all parties in technical matters

Anton Piller Orders

Anton Piller OrdersRole of Supervising Solicitor after the search

•The Order should make clear the responsibilities of the supervising solicitor after the search

•File a report of the search within a time limit describing the search and evidence seized

•Oversee the review of evidence

•Protect privilege

Anton Piller Orders

Anton Piller OrdersMareva Injunctions used with Anton Piller Orders

•This is an interim or interlocutory injunction made, in most cases, without notice.

•Prohibits the Defendant from disposing of assets pending the outcome of the action between the parties.

•Must show a real risk that the assets may be disposed of.

Anton Piller Orders

Anton Piller OrdersRecent Fraud Cases

•Commonly used for commercial files but increasingly being used in fraud files

•Especially, complex family law matters where information is being concealed

•Often the files are sealed, so frequency of use of the Anton Piller Order may not be commonly known

•Due to the ease inwhich electronic information can be destroyed and/or concealed, the ex-parte order helps preserve this evidence

Anton Piller Orders


•Family Law - Undisclosed income and assets (2013)

The Plaintiff knew the Defendant spouse earned substantial undisclosed income from criminal activity. The defendant was profiled and electronic evidence was obtained that supported that there was a strong possibility of undisclosed income.

An Anton Piller Order and a Mareva Injunction was ordered.

As a result of the civil search, significant cash was seized, as well as other expensive assets and electronic data. The case settled prior to the electronic data being analyzed.

Anton Piller Orders


Fraud Against an Estate – Theft of funds (2013)

An individual worked himself into the confidence of an elderly person who willed him $750k to him and passed away. The rogue collected the funds.

The Police investigated the individual and found that he had committed the same act with a second elderly person and was about to collect $250k on this other estate.

Before the executor of the second estate paid out, the heirs to the first estate brought a civil action and obtained a Mareva Injunction and Anton Piller Order.

The individual’s apartment was searched and paper evidence of existing bank accounts was found. The bank accounts were frozen.

Anton Piller Orders


Family Law – Undisclosed Income for Support Purposes (2012)

The Plaintiff knew her Defendant spouse carried on an internet business. The income from this business was not disclosed. Without an accurate determination of income, spousal and child support could not be determined.

In order to gain evidence of the business income, an Anton Piller Order provided access to the Defendant’s computer records. The Mareva Injunction prevented the Defendant from using the income derived from this business until the litigation matter was resolved.

During the search, computers, laptops and other electronic devices were seized. Based on the analysis of these devices and other seized documents, an estimate of the Defendant’s income was determined and support established.

Anton Piller Orders


Family Law – Removal of Family Assets from the Jurisdiction (2005)

The Plaintiff believed her husband had moved RRSP funds to Ireland and was planning on moving there.

The Plaintiff attempted to obtain disclosure through a number of hearings. The husband did not comply and was found in contempt of court.

An Anton Piller Order was ordered to search the home where the husband lived and removed items to assist in the dispute.

Anton Piller Orders

Anton Piller OrdersBenefits of using the Anton Piller Order

•Saves cost to litigants when the Plaintiff is in a position where it would take numerous court applications to obtain the evidence

•Saves evidence from disappearing

•Serves as a motivator for the Defendant to settle

Anton Piller Orders

Anton Piller OrdersOpportunities for Investigators

•Provide strong prima facie evidence

•Assist in conducting the search

•Analyze the information obtained in the search

•Provide expert witness testimony

Anton Piller Orders

Anton Piller OrdersExperts Used

•Forensic Computer Experts (review online internet activity, copy hard-drives, analyze data, attend search party)

•Forensic Accountants (provide evidence in Court, review and analyze evidence obtained by the Order)

•Investigators (provide evidence for the Order, attend search party, provide on-going evidence)

Anton Piller Orders

Anton Piller OrdersContact

Rosanne E. [email protected]

T: 604 646 4381

Michael Z. Galambos [email protected]

T: 604 629 1052

anton piller orders page 1 civil search warrants: how they are used in fraud cases acfe 2014...

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