In an important case decided in June 2020, the Supreme Court, in Liu et al v. SEC, addressed the SEC’s ability to seek “equitable relief” in civil proceedings. In 2017, the Supreme Court, in Kokesh v. SEC, ruled that a disgorgement order in an SEC action constitutes a “penalty” for purposes of application of the five-year statute of limitations. The Supreme Court left open the...
We have a new poster-child for a defective corporate culture of wrongdoing. Novartis has joined the exclusive club, along with Siemens, General Motors, Wells Fargo, and others in the misconduct Hall of Fame. Within the space of two weeks, Novartis has settled FCPA violations for foreign bribery, and just recently, Novartis settled two separate cases in the United States for anti-kickback and False Claims Act...
The Volkov Law Group wishes everyone a Happy Fourth of July!! Even in this turbulent and troubled times, we should share our gratitude for the sacrifices so many have made in the past to secure our freedoms, while recognizing that our work to build an even greater country continues. We hope that everyone — our clients, our colleagues, friends and family are staying safe and...
Companies are under enormous stress given the pandemic and the social unrest. Employees are looking to companies to provide some sense of stability and ultimately leadership. Corporate leaders are being tested and it is clear that in this defining moment, some will rise and some will fail. It is pretty obvious whether a CEO can meet this challenge. Perfunctory and happy-talk emails or positive messaging...
The Novartis and Alcon FCPA enforcement action is chock full of interesting issues. See Novartis DPA Here , Alcon DPA Here and SEC Novartis Order Here. At the outset, Novartis is “lucky” – the settlement is relatively positive, despite its 2016 SEC enforcement action in China. Given Novartis weak culture of compliance (if anything, a better description may be a culture of non-compliance) and its...
Novartis and Alcon engaged in separate but significant bribery schemes. Considering the fact that Novartis had a similar violation in 2016 in China involving much of the same conduct, Novartis’ conduct reflects a weak corporate culture of compliance. Novartis’ conduct is all the more troubling given its enforcement record on domestic False Claims Act and anti-kickback prosecutions. Novartis has real compliance and culture problems, apparently...
Even during this difficult time of the pandemic, economic uncertainty and social unrest, the Justice Department and the SEC have concluded a major FCPA enforcement action. Novartis and Alcon (which was a Novartis subsidiary at the time of the misconduct) agreed to pay a total of $345 million in criminal and civil penalties. Novartis spun off Alcon in 2019. Under the DOJ settlement, Novartis and...
Companies that rely on mergers and acquisition for growth have to build robust post-acquisition integration policies and controls. Such a requirement applies not only to ethics and compliance program integration but to overall business operations. Successful companies employ a robust pre-acquisition planning process, incorporating ethics and compliance as an important part of the overall integration process. Compliance officers have to participate in the integration process...
The Justice Department’s recent revisions to the Evaluation of Corporate Compliance Programs highlights an important trend and evolution of prosecution focus. DOJ’s Revised Corporate Compliance Guidance recognized and reinforced the continuing focus on post-acquisition integration versus pre-acquisition due diligence. For years, DOJ and compliance professionals placed significant emphasis on pre-acquisition due diligence. This balance has been adjusted over the last ten years to raise the...
After a lengthy sentencing hearing in federal court in San Francisco, Bumble Bee CEO Chris Lischewski was sentenced to 40 months in prison for his involvement in a tuna price-fixing conspiracy. The judge rejected prosecutors’ request to sentence Lischewski to 10 years in prison. Lischewski, who is 59 years old, argued for 12 months home confinement in view of the coronavirus. Judge Chen also imposed a...
