The controversy surrounding Deferred Prosecution Agreements (“DPAs”) and Non- Prosecution Agreements (“NPAs”) continues to boil.

In response to continuing criticism that the Justice Department is using DPAs and NPAs to coddle or let companies off the hook, the Justice Department has been channeling former President Regan’s famous speech in Berlin when he told Mr. Gorbachev to “tear down” the Berlin Wall. Criminal Division AAG Caldwell gave a speech last week in Miami in which she reassured everyone that DOJ prosecutors would “tear up” a DPA (or NPA) when a company continues to violate the law.

I know everyone wants to “tear up” or “tear down” something but before we get too far ahead of ourselves, let’s get back to basics. Companies will take a DPA rather than plead guilty to a criminal offense. Critics of DPAs want companies to plead guilty and agree to the same set of conditions as included in the DPA to reform corporate governance.

Even the courts are becoming suspect of DPAs. Judge Leon in Washington D.C. rejected a DPA as too lenient in an export control and sanctions case. Judge Gleason in New York asserted authority to review and reject the HSBC settlement for $1.9 billion relating to AML and sanctions violations. In the end Judge Gleason approved the HSBC settlement but he clearly laid a marker down that he would review and question future settlements.

DOJ has slowly been backing away from DPAs and suggesting that it will use the tool less frequently in the future. That may be easier said than done since defense counsel will continue to press for such a solution rather than plead guilty to a criminal offense.

Advocates for jettisoning DPAs harken back to the “good old days” when companies were either charged with a criminal offense or prosecutors declined to prosecute. The DPA middle ground opened up a whole new class of cases where the evidence may not have sustained a criminal case but prosecutors wanted to show something for their hard work.

Companies and defense counsel continue to argue that proving a corporate criminal case is too easy – a rogue employee can cause a company to be liable based on the well-established doctrine of respondeat superior. A single employee acting within the scope of his or her duties and acting for the benefit of the company creates corporate liability.

Companies and defense counsel who are unhappy with this well-established principle have to come up with an alternative mechanism for liability. While I do not regularly subscribe to the concept of a “rouge” employee, I am also skeptical that there are any workable alternatives to respondeat superior. But I am open to ideas, and I am sure some interesting concepts can be designed.

Take the recent AML/sanctions prosecutions against Commerzbank and BNP Paribas – there is not much room for argument against corporate liability in those cases, even though Commerzbank luckily escaped with a DPA.

I know that everyone cites the Peterson case for a true example of an FCPA rogue employee case but my intelligence on the case indicated that the SEC strongly wanted to prosecute Morgan Stanley based on evidence demonstrating that Peterson was not a rogue employee. DOJ apparently wanted to demonstrate for political reasons that it could recognize a company’s compliance program to decline a case against a company.

One solution that has absolutely no merit is recognition of a compliance program defense. Advocates for that solution have wasted time and energy (and print) on promoting an idea that has little merit and is unworkable in practice.

For now, DOJ is suggesting that it may return to the old days of prosecute or decline, with no middle ground solutions. That may not be such a bad thing. Companies may be forced to go to trial to defend themselves, challenge the government’s prosecution theories, and help to develop court interpreted legal principles surrounding the FCPA.