In a first-of-its-kind decision sure to please executives under investigation everywhere, a federal judge has slapped down prosecutors for pressuring KPMG to cut off legal support to 16 employees indicted for selling illegal tax shelters.

In a New York federal court, Judge Lewis Kaplan said that KPMG refused to pay its employees’ legal bills “because the government held the proverbial gun to its head.” Kaplan went on to say that the Justice Department’s policy of considering whether a company pays the legal fees of employees accused of wrongdoing as a factor in whether to indict the company itself is unconstitutional. ...