Manatt Partner Discusses Landmark Ruling in FCPA Case

Manatt Partner Discusses Landmark Ruling in FCPA Case

"FCPA Defendants Face Tougher Slog After Latest SEC Win"
Law360

February 13, 2013 - Manatt's Jacqueline Wolff, co-chair of the firm's Corporate Investigations & White-Collar Defense Practice, spoke to Law360 about why foreign citizens may find it harder to fight the U.S. Securities and Exchange Commission's Foreign Corrupt Practices Act claims.

As reported by Law360, U.S. District Judge Richard J. Sullivan recently issued a landmark ruling that struck down two commonly used defenses that foreign citizens would use in civil FCPA cases. Judge Sullivan denied a motion by two former Hungarian telecommunication executives to dismiss allegations that they tried to bribe Macedonian officials in 2005 to block a competitor from entering that country. At the time, the company's stock traded on U.S. exchanges, and it allegedly failed to disclose the bribes in its SEC filings.

Judge Sullivan ruled that the FCPA's five-year statute of limitations doesn't begin to run until a defendant physically sets foot in the United States. He also said the SEC didn't need to prove the defendants intended to engage in corruption through "interstate commerce" in order to establish U.S. jurisdiction.

Wolff told the publication that, taken together, the findings could embolden the SEC to target even more foreign citizens in its anti-bribery crackdown.

"This seems like it's part of the same trend," she said. "The SEC is looking for ways to pull in foreign citizens who you might not have thought were covered under this provision."

After Friday, other federal judges may take a page from Judge Sullivan's book and make such cases harder to contest, she added.

"It'll be interesting to see if other courts jump on that bandwagon," said Wolff.

Read the article here.

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