Tag Archives: Philip Rohlik

Safeguarding Corporate Compliance Programs During the COVID-19 Crisis

by Kara Brockmeyer, Andrew M. Levine and Philip Rohlik

COVID-19 has altered life for billions, including how companies interact with their employees, business partners, and regulators. Some changes will reverse as the pandemic ebbs or the virus becomes treatable. Others likely will remain for an extended period of time or even become permanent.

No matter the exact course of the coming months, disruptions from COVID-19 already have had a significant impact on corporate compliance functions, internal investigations, and government enforcement. These disruptions will continue to evolve, affecting companies in differing ways and leaving an unmistakable imprint on the compliance landscape. Continue reading →

Second Circuit Curbs FCPA Application to Some Foreign Participants in Bribery

by Kara Brockmeyer, Colby A. Smith, Bruce E. Yannett, Philip Rohlik, Jil Simon, and Anne M. Croslow

I. Introduction

On August 24, 2018, the Second Circuit handed down its long-awaited decision in United States v. Hoskins, [1] addressing the question of whether a non-resident foreign national can be held liable for violating the FCPA under a conspiracy theory, where the foreign national is not an officer, director, employee, shareholder or agent of a U.S. issuer or domestic concern and has not committed an act in furtherance of an FCPA violation while in the U.S.  In a word, the court held that the answer is “no,” concluding that the government may not “expand the extraterritorial reach of the FCPA by recourse to the conspiracy and complicity statutes.”[2]  The court added, however, that the same foreign national could be liable as a co-conspirator if he acted as an agent of a primary violator. 

While the ruling is undoubtedly an important curb on some potential sources of liability for foreign entities and individuals, the availability of agent liability may limit the practical impact of the decision for many non-resident foreign nationals.  Unfortunately, the decision did not address the scope of agent liability under the FCPA, leaving that issue open.  As a result, further development in this and subsequent cases — especially with respect to the meaning of “agency” under the FCPA — will necessarily be required before the full impact of the Hoskins ruling becomes clear. However, the decision is likely good news for foreign companies that enter into joint ventures with U.S. companies and some other classes of potential defendants, as it may be harder for the U.S. government to charge them with FCPA violations. Continue reading →

Corporate Recidivism in the FCPA Context

by Bruce E. Yannett, Andrew M. Levine and Philip Rohlik and Maxwell K. Weiss

Introduction

Among the flurry of resolutions in the final days of the Obama administration, two “repeat offenders” settled FCPA cases: Zimmer Biomet Holdings, Inc. (“Zimmer Biomet”)[1] and Orthofix International N.V. (“Orthofix”).[2]  Zimmer Biomet and Orthofix are hardly the first such “repeat offenders.”  In July 2016, Johnson Controls Inc. (“JCI”) settled an enforcement action involving activities of a Chinese subsidiary with the Securities and Exchange Commission (“SEC”),[3] and the DOJ simultaneously “declined” to bring any charges.[4]  Each of these companies was a “repeat offender” in having previously settled FCPA-related allegations.

By analyzing and comparing these three recent resolutions, this Article highlights factors that may influence whether U.S. authorities bring follow-on FCPA enforcement actions and, if so, what penalties they seek to impose.  As discussed below, companies are well advised to make concrete compliance enhancements in an effort to avoid recidivist status and the significant penalties that can accompany a second resolution. Continue reading →

Judicial Scrutiny of Corporate Monitors:  Additional Uncertainty for FCPA Settlements?   

by Andrew M. Levine, Philip Rohlik, and Michael W. Gramer

Like many other complex corporate criminal matters, FCPA matters largely get resolved without meaningful judicial oversight.  Although imperfect, such negotiated settlements do provide corporations with a greater degree of predictability and finality.  In addition to a monetary penalty, these resolutions often involve the appointment of a compliance monitor, which occurred in more than half of the DOJ’s FCPA resolutions in 2016.[1]  The appointment of monitors has attracted controversy over the years, including that monitors are often seen as burdensome and expensive, have the practical effect of extending an investigation, and effectively outsource oversight to a third party.  As with negotiated resolutions themselves, typically there has been little judicial involvement in the appointment or oversight of corporate monitors. Continue reading →

The Difficulty of Defining a Declination: An Update on the DOJ’s Pilot Program

by Bruce E. Yannett, Andrew M. Levine and Philip Rohlik

On September 29, 2016, the U.S. Department of Justice (“DOJ”) issued two letters “closing its investigations” into alleged violations of the U.S. Foreign Corrupt Practices Act by HMT LLC, a Texas based manufacturer, supplier and servicer of above ground liquid storage tanks, (the “HMT Declination”)[1] and NCH Corporation, a Texas based industrial supply and maintenance corporation (the “NCH Declination).[2]  Unlike in the three earlier “declinations” the DOJ issued since the start of its FCPA Enforcement “Pilot Program,”[3] the companies here (HMT and NCH) are not issuers, so there were no parallel Securities and Exchange Commission (“SEC”) enforcement actions.  Each declination also includes what are described as findings of the DOJ’s investigation underlying violations of the FCPA and a requirement that each company pay “disgorgement” to the U.S. Treasury.  The HMT and NCH declinations therefore raise the question of whether and to what extent the Pilot Program, in addition to offering guidance on how to receive a declination, has altered the meaning of what a declination ordinarily will be.  Specifically, under what circumstances can a company receive a declination without the DOJ publicizing its “findings” and the company paying disgorgement (i.e., a “clean” declination)? Continue reading →