The US Court of Appeals for the Second Circuit, in a decision issued on December 3, 2012, in United States v. Caronia, threw out a criminal conviction of the defendant Alfred Caronia, a pharmaceutical sales person, for an off-label marketing violation, ruling that the prosecution violated the First Amendment. (A copy of the decision is here). The Caronia Court ruled in a 2-1 decision that the...
The US Chamber of Commerce “praised” the FCPA Guidance. The Chamber did not get what it wanted but it had to recognize that the FCPA Guidance was helpful for businesses. The FPCA Guidance provides important information for compliance, due diligence and other relevant issues. Some industries received a little bit of relief; others did not. Unfortunately, for the pharmaceutical and medical device industries, the FCPA...
Compliance professionals need to thank DOJ and SEC for the FCPA Guidance discussion on corporate compliance. DOJ and SEC provide important suggestions for improving compliance but they do so while reaffirming several important compliance principles. First, and most importantly, DOJ and SEC reaffirm the requirement that a single senior manager or group of senior managers must be assigned responsibility for the compliance program, have appropriate...
It is interesting that the most significant advances in compliance program requirements have been developed in the context of criminal prosecutions. Maybe it is because the stakes are so high and the government’s leverage is at its zenith. The US Sentencing Guidelines’ definition of an “effective compliance program” led to a sea-change in corporate compliance. The FCPA Guidance is an equally transformative document. FCPA enforcement...
The FCPA Guidance contains good news and bad news. When I ask one of my kids which they want to hear first … they inevitably choose bad news first. With that in mind, the FCPA Guidance includes relatively bad news on successor liability. In leading up to the FCPA Guidance, I thought the DOJ and SEC “teasers” would become a reality. What was I hoping...
Perhaps I was being overly optimistic. I thought the Justice Department and the SEC could bring a little clarity to the term “instrumentality” in the definition of a “foreign official” under the FCPA. It was wishful thinking on my part. In fairness, the Justice Department has a pending appeal before the 11th Circuit on this issue and any statements made could definitely have been used...
The FCPA Guidance is a terrific contribution to FCPA law and policy. I have the utmost respect and admiration for the DOJ and SEC professionals who enforce this law. They are true public servants. A testament to the importance of the FCPA Guidance is the absence of any meaningful or persuasive criticism of the FCPA Guidance. Of course, the FCPA Paparazzi will try and strike...
Companies often get “hung up” on paying for gifts, meals, travel and entertainment expenses. There are risks in this area but it most cases the risks are overblown. I am not saying that companies should ignore the issue but companies spend too much time on this issue which can be better used on financial controls and third party risks. The FCPA Guidance only reinforces...
With all the hype and bloviating behind us, it is now time to take a closer look at some of the more significant aspects of the FCPA Guidance. For those who continue to carp about the failure of the FCPA Guidance to contain any real “reforms,” I would suggest that your expectations were misguided. Those who anticipated significant changes to FCPA enforcement were way off...
It has taken a long time but the status of whistleblowers has reached an all time high. Whistleblowers can expect even more encouragement and protections in the future. What is the reason for this? Does greater reliance on whistleblowers reflect a lack of confidence in traditional law enforcement tactics? The Obama Administration’s aggressive enforcement program has been built on a number of principles which are...
