Alison Frankel

In new amicus brief, SEC wants to protect whistleblowers – and itself

February 21, 2014

In 2012 and 2013, when the 5th Circuit Court of Appeals was considering the question of whether Dodd-Frank’s anti-retaliation provisions protect whistleblowers who report their concerns internally, rather than to the Securities and Exchange Commission, the SEC stayed out of the fray. The case, Khaled Asadi v. G.E. Energy, centered on the tension between two sections of Dodd-Frank, one of which seemed to define whistleblowers only as those who tip the SEC about potential misconduct by their employers. In its Dodd-Frank implementation process, the SEC attempted to resolve the tension, issuing rules to clarify that whistleblowers are protected from retaliation regardless of whether they report concerns to the agency or up the chain of command through internal compliance programs, as the older Sarbanes-Oxley Act had encouraged. The SEC’s rules have convinced most of the federal trial judges who have considered the scope of Dodd-Frank whistleblower protections; courts have typically cited the deference due to the agency’s interpretation of a law it is responsible for enforcing.

With FCPA under scrutiny, will DOJ expand use of Travel Act?

March 12, 2012

If the Foreign Corrupt Practices Act is Peyton Manning, the Travel Act could turn out to be his little brother Eli.

News Corp and the FCPA paradox

February 28, 2012

For the Justice Department’s Foreign Corrupt Practices prosecutors, last week was the best of times and the worst of times. A federal judge in Houston sentenced the former CEO of the Halliburton spin-off KBR Inc. to 30 months in prison for his role in a 10-year scheme to pay $182 million in bribes to Nigerian officials in order to secure $6 billion in military oil and gas contracts. Albert Stanley’s sentencing marked the end of one of the DOJ’s most successful FCPA prosecutions, in which KBR agreed to pay $579 million in criminal fines and disgorged profits — the second-highest fine in an FCPA case at the time the guilty plea and Securities and Exchange Commission settlement was announced in 2009. The KBR case is an FCPA paradigm, a classic demonstration of the law’s power to expose and punish corruption that would otherwise have stayed in the shadows.

Lawyers for latest acquitted FCPA defendants: DOJ ‘overreaching’

January 31, 2012

When Michael Madigan of Orrick, Herrington & Sutcliffe delivered a closing statement two weeks ago in the criminal trial of his client Greg Godsey, he told the federal jury in Washington, D.C., that the government had “danced with the devil.” In 2007, Madigan said, the Justice Department set up a “little nest out in Manassas, Virginia,” with the express intention of putting together Foreign Corrupt Practices Act cases. But when the FBI first tried to use an informant who appeared right after the Manassas base was established, it couldn’t make out any traditional cases based on his evidence. So according to Madigan, the Justice Department instead engineered a 2009 sting involving alleged bribes to the defense minister of Gabon in exchange for military supply contracts. That operation netted Justice 22 FCPA defendants and countless headlines touting its get-tough policy on foreign corruption.

What FCPA defendants can learn from blockbuster Lindsey win

December 5, 2011

In the run-up to the first trial of a corporation charged with violating the Foreign Corrupt Practices Act, Lindsey Manufacturing and its lead counsel, Jan Handzlik, put up as vigorous a defense as you can imagine. Handzlik (then at GreenbergTraurig and now at Venable) worked with Janet Levine of Crowell & Moring (counsel for Steve Lee, Lindsey’s former CFO) to challenge the government’s conduct, its evidence, even its interpretation of the FCPA’s language. It was to no avail. In May, after a five-week trial and seven hours of deliberation, a Los Angeles federal jury convicted Lindsey Manufacturing, chairman and CEO Keith Lindsey, and CFO Lee on all counts. For Handzlik and Levine, who were convinced the prosecution’s allegations that their clients funneled bribes to officials of a Mexican state-owned electric company were meritless, the conviction was devastating.