Bribery Conspiracies, Foreign and Domestic: Ocasio v. United States and Its Implications for FCPA Complicity Theories

by Shu-en Wee and Daniel Richman*

To what extent can a nonresident foreign national be prosecuted for violations of the Foreign Corrupt Practices Act (FCPA)[1] when he neither is an agent of a domestic concern nor has committed acts while physically present in U.S. territory?  Does the fact that the FCPA explicitly creates criminal liability in only these two situations mean that he cannot be charged for conspiring to violate the Act, or aiding and abetting a violation?  Such was the issue presented to Judge Janet Bond Arterton in United States v. Hoskins.[2]  Her rejection of the government’s conspiracy and accomplice theories in that case is presently up on appeal in the Second Circuit, but an intervening Supreme Court case may well lead the Circuit to see the case a bit differently.

In Hoskins, a British national who had been Alstom U.K.’s Senior Vice President for Asia and had also worked for Alstom Resources Management S.A. in France, was charged with participating in a scheme to bribe various Indonesian officials.  Mindful of the limitations of the FCPA, the government alleged that his use of “consultants” for steering bribes to the officials violated the general conspiracy statute and also amounted to “aiding and abetting” an FCPA violation.

When rejecting these prosecution theories, Judge Arterton relied heavily on United States v. Gebardi[3] and some of its progeny.   That 1932 case involved a man and a woman charged with conspiring to violate the Mann Act — which proscribes the knowing transportation or the causing, aiding, or assisting of transportation, of any woman or girl for the purpose of “prostitution, or debauchery, or for any other immoral purpose” in interstate or foreign commerce.[4] There was evidence that the man had purchased the railway tickets, and that the woman had “consented” to “voluntarily” follow the man for the immoral purpose of engaging in sexual intercourse.[5] The Supreme Court, however, determined that this level of consensual engagement was not enough. Sure, general conspiracy law is pretty sweeping, the Court reasoned, but conspiracy liability under the Mann Act had to reflect the contours of liability under that specific provision. The “failure” of the Mann Act to expressly create liability for the woman’s participation in the crime where the woman’s participation was an “inseparable incident” of the crime, the Court reasoned, bespoke an “affirmative legislative policy” to leave the woman’s acquiescence unpunished, whether under the Act itself or on a theory of conspiracy.

When moving to dismiss the indictment, Hoskins looked to the legislative history of the FCPA. He found in it an intent to immunize nonresident foreign nationals from prosecution, and argued that Gebardi therefore precluded any conspiracy charge against such individuals (absent an agency relationship or other US contact). The government, not surprisingly, read Gebardi and its progeny more restrictively.  It arguing the relevant inquiry was not into any broad issue of legislative intent, but rather into the very structure of the statute.  Only when a party who is “necessary” to an offense but has nonetheless been excluded from a statute’s purview would the immunization from substantive law carry over to conspiracy or accomplice liability.

Ultimately, Judge Arterton determined that the Gebardi principle exempted Hoskins from conspiratorial liability. She reasoned the Gebardi principle allowed for congressional intent to immunize a given class of persons in “other circumstances” beyond the situation laid out in the government’s memorandum.[6] In support of this, Judge Arterton drew heavily on Second Circuit precedent, Amen, where the court applied the Gebardi principle because “legislative history . . . makes clear that the purpose [of the drug kingpin statute] . . . was not to catch in the net those who aided and abetted the supervisor’s activities.”[7]

The ruling, which the government has appealed to the Second Circuit, raises tough issues about the appropriate scope of FCPA liability.  Notwithstanding the drumbeat of complaints from the U.S. Chamber of Commerce and others about FCPA’s breadth, the narrowing of the pool of individuals who could be criminally prosecuted for corporate crimes could prevent prosecution of the most culpable individuals in multinational companies with international operations and international employees.  As the government noted in its brief in Hoskins, it was odd that a “high-level” executive (like the defendant) who potentially played a substantial role in orchestrating the entire bribery scheme should fall through the cracks of the FCPA and be “immune from prosecution” from the outset.

When it hears this case, the Second Circuit will have to consider the Supreme Court’s articulation of the Gebardi principle in a case this May, Ocasio v. United States.[8]  That case involved a different kind of bribery prosecution – one with its own peculiar doctrinal challenges.  The defendant there was a police officer charged with participating in an extortion conspiracy, with the purpose of the conspiracy to “obtain property from another” “under color of official right,” in violation of the Hobbs Act.  The twist here was that, because a reasonably settled interpretation has allowed instances of quid pro quo bribery to be charged as “extortion,” the defendant here was ostensibly being charged with conspiring his “victims.”

In the course of rejecting the Ocasio defendant’s effort to gain the benefit of the Gebardi principle the Court, with Justice Alito writing, highlighted the limitations of the protection it offers.  Gebardi is good law, but so is United States v. Holt, where, prior to Gebardi, the Court, in what Justice Alito called a “succinct opinion by Justice Holmes” in another Mann Act case, held that “a person may conspire for the commission of a crime by a third person,” even if “she could not commit the substantive crime herself.”

Justice Alito concluded: “Holte and Gebardi make perfectly clear that a person may be convicted of conspiring to commit a substantive offense that he or she cannot personally commit. They also show that when that person’s consent or acquiescence is inherent in the underlying substantive offense, something more than bare consent or acquiescence may be needed to prove that the person was a conspirator.”

In the Second Circuit, Hoskins will surely urge the more expansive (although always fraught) engagement with legislative history that underlay Judge Arterton’s invocation of Gerbardi.  But the government can draw considerable support from the emphasis on Gebardi’s limitations in Ocasio.

* This post draws on a Note by Shu’en Wee, The Gebardi Principles, forthcoming in the Columbia Law Review.


[1] 15 U.S.C. §§ 78dd-1–3 (2012).

[2] 2015 WL 4774918 (D. Conn. Aug. 13, 2015).

[3] 287 U.S. 112 (1932).

[4] 36 Stat. 825 (1910) (current version at 18 U.S.C. § 2421 (2012)).

[5] Gebardi v. U.S., 287 U.S. 112, 116 (1932).

[6] Id. at *5.

[7] United States v. Amen, 831 F.2d 373, 382; see also U.S. v. Hoskins, 2015 WL 4774918, at *5 (quoting passage from Amen).

[8] 578 U.S. ____ (2016).

Shu-en Wee, is a member of Columbia Law School’s Class of 2017. Daniel Richman is the Paul J. Kellner Professor of Law at Columbia Law School.


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