Courts push back on bribery prosecutions | Reuters (Aruna Viswanatha)

As the Justice Department has stepped up its enforcement of an anti-foreign bribery law, it has faced the expected stiff resistance from the business community.

Now it faces the unexpected as courts are pushing back, too.

In an unusual verbal order issued earlier this week, a federal judge in Houston dismissed without sending to the jury a case against a Texas man accused of authorizing bribes to government officials in Mexico, on behalf of his former employer, a unit of ABB Group (ABBN.VX).

The government’s principal witness “knows almost nothing”, U.S. District Judge Lynn Hughes said in announcing his decision to acquit the defendant, John O’Shea, according to a transcript.

Prosecutors also did not produce evidence to “conclude beyond a reasonable doubt” that a middleman did nothing for Swiss power products company ABB beyond pay the bribes, he said.

The decision is the latest in a string of setbacks for the Justice Department unit that prosecutes violations of the Foreign Corrupt Practices Act, a 1970s law that bars U.S.-linked companies and individuals from paying bribes to officials of foreign governments in exchange for business.

via Courts push back on bribery prosecutions | Reuters.

Deutsche Telekom, Magyar Unit To Pay $95 Million To Settle FCPA Case – Corruption Currents – WSJ

Deutsche Telekom AG and its Hungarian telecommunications unit agreed to pay more than $95 million in civil and criminal penalties to resolve U.S. probes over alleged bribes by former senior executives to government officials in Macedonia and Montenegro, authorities said Thursday.

The settlement resolves investigations stretching back about five years by the Justice Department and the Securities and Exchange Commission against Deutsche Telekom and its majority-owned Magyar Telekom unit. The Wall Street Journal

via Deutsche Telekom, Magyar Unit To Pay $95 Million To Settle FCPA Case – Corruption Currents – WSJ.

BP employees could face criminal spill charges – Houston Chronicle (Simone Sebastian)

Federal prosecutors are considering criminal charges against individual BP engineers for allegedly providing federal regulators with false information related to the safety of the well that was at the center of the nation’s largest offshore oil spill, according to a source involved with the case.

The source said it is not yet clear if the Department of Justice will target individual BP employees or focus on charges against the company. But the source said a decision could be made as soon as next month.

The charges could come nearly two years after the Macondo well blowout and Deepwater Horizon rig explosion killed 11 workers and spilled an estimated 4.9 million barrels of oil into the Gulf of Mexico.

The Wall Street Journal reported Thursday, according to people familiar with the matter, that federal prosecutors were preparing felony charges against several Houston-based engineers and at least one of their supervisors.

via BP employees could face criminal spill charges – Houston Chronicle.

Wal-Mart Discloses Internal FCPA Review – WSJ

Wal-Mart Stores Inc. disclosed late Thursday that it had started an internal review into potential violations of a U.S. foreign bribery law.

The global retailer said in its quarterly report that it had voluntarily contacted the U.S. Department of Justice and the Securities and Exchange Commission about the investigation.

“[T]he Company has begun an internal investigation into whether certain matters, including permitting, licensing and inspections, were in compliance with the U.S. Foreign Corrupt Practices Act,” the company said.

via Wal-Mart Discloses Internal FCPA Review – Corruption Currents – WSJ.

Justice Department Gears Up for AT&T Litigation

The U.S. government doesn’t appear to be gung-ho in reaching a settlement agreement with AT&T over a lawsuit aimed at blocking the telecom titan’s purchase of T-Mobile USA.

Asked at a Senate hearing whether the U.S. Department of Justice is in the case “for the long haul,” Attorney General Eric Holder responded that the agency doesn’t file a case if it is not prepared to see it through, The Wall Street Journal reported.

“There is a trial team that is in place and they are ready and eager to go to court,” The Journal quoted Holder.

AT&T is set to battle the Justice Department in federal court during a trial that is set for February. The Justice Department plans to hire Glenn Pomerantz, a litigator at law firm Munger, Tolles & Olson LLP, to strengthen its legal team for the trial, the Journal reported, citing people familiar with the matter.

via Justice Department Gears Up for AT&T Litigation.

AFP: Google to settle US online drug probe for $500 million: NYT

Google will pay $500 million to settle charges that it sold advertisements to illicit online pharmacies based in Canada, US justice officials announced on Wednesday.

The Canadian online pharmacies broke the law by selling prescription drugs to Americans without complying with US safety standards, the US Department of Justice said in a statement.

The pharmacies used Google’s Adwords programs to target customers in the United States, and the Internet search giant allowed the ads to appear on its website from 2003 to 2009, it said.

Google first disclosed that it was under investigation in a May filing with the US Securities and Exchange Commission, and set aside $500 million in anticipation of the results of the probe.

via AFP: Google to settle US online drug probe for $500 million: NYT.

Merger Review: FTC, DOJ Ponder Who’s On First?

(Business Law Currents) In her farewell address, Christine Varney, outgoing head of the U.S. Department of Justice’s Antitrust Division (DOJ), made headlines recently when she pointedly questioned the state of American merger review, calling for Congressional examination of the antitrust authority shared by both the DOJ and the Federal Trade Commission (FTC).

With a two-headed Cerberus guarding consumers from potential monopolists, the fact that both the DOJ and the FTC share the same Horizontal Merger Guidelines (“the Guidelines”), undoubtedly raises a number of questions. For example, “If both agencies use the same Guidelines, why wouldn’t the results always be the same?” A more obvious question might be, “If two agencies use the same Guidelines, why have two agencies in the first place?”

Being Washington, the second query answers itself. The glib but incontestable rejoinder is that Joe Biden will walk on the Potomac before a D.C. bureaucrat cedes turf. While both the FTC and DOJ have different spheres of influence, “The unifying theme of [their joint] Guidelines is that mergers should not be permitted to create, enhance, or entrench market power or to facilitate its exercise.”

via Merger Review: FTC, DOJ Ponder Who’s On First?.

The Potential Perils of Cross-Border Internal Investigations | Law.com

With the U.S. Department of Justice campaigning against companies that pay off government officials abroad, and the UK Bribery Act (often referred to as the “Foreign Corrupt Practices Act [FCPA] on steroids”) about to go into effect next month, it is a tricky time for corporations that do business internationally.

Wallace Dietz, co-chair of the Internal Investigations and Government Enforcement Group of Nashville, Tennessee-based Bass, Berry & Sims, has led inquiries for a number of Fortune 500 companies. After participating in a June 15 panel discussion held in New York City by the International Law Office, he sat down with reporter Jan Wolfe to talk about the challenges lawyers face overseeing probes that span borders and multiple legal systems. An edited version of their conversation follows.

CorpCounsel: What advice would you give attorneys managing their first cross-border investigation?

Wallace Dietz: The first thing to do when you have an investigation outside the U.S. is figure out the very basic, fundamental ground rules. Otherwise you could make significant mistakes. That’s true in terms of attorney-client privilege. And it’s true in terms of collecting evidence and data, especially with certain privacy and data protection laws. Certain things that you assume in the U.S. about how to conduct an investigation simply are not true when you get into a foreign country.

via The Potential Perils of Cross-Border Internal Investigations.

Alcatel Finalizes Multimillion-Dollar Bribery Settlement | Law.com

French telecommunications company Alcatel-Lucent SA finalized its settlement Wednesday with the U.S. over bribes paid to officials in Costa Rica, Honduras, Malaysia and Taiwan.

The deal concluded in Miami federal court includes a $92 million penalty as part of a deferred prosecution agreement with the Justice Department. Alcatel also has already paid another $45 million to settle a related Securities and Exchange Commission case and $10 million in a corruption case brought by the Costa Rican government.

“It is one of the largest resolutions in the history of the Foreign Corrupt Practices Act,” said Charles Duross, a top Justice Department fraud prosecutor.

Three Alcatel subsidiaries pleaded guilty to violating the anti-bribery law and will pay a combined $1.5 million in fines. The pleas were entered Wednesday by Steven R. Reynolds, general counsel of parent company Alcatel-Lucent.

Prosecutors said the bribes enabled Alcatel to win numerous multimillion-dollar telecommunications contracts in the four countries and were deeply ingrained in the company’s business around the world. The illegal arrangements continued from at least the 1990s until late 2006, often using local consultants and agents as conduits to bribe foreign government officials.

via Alcatel Finalizes Multimillion-Dollar Bribery Settlement.

Justice Stevens Okays bin Laden Killing – Law Blog – WSJ

John Paul Stevens has been making some news lately — urging Congress to crack down on prosecutorial misconduct, propping up Justice Alito.

For a nonagenarian, the guy gets around.

Here’s the latest: The justice who wrote Supreme Court opinions upholding the rights of Guantanamo detainees said Thursday that the killing of Osama bin Laden was lawful.

“It was not merely to do justice and avenge Sept. 11,” but “to remove an enemy who had been trying every day to attack the United States,” Justice Stevens said at a dinner in Chicago, according to former Stevens law clerk Diane Amann, a University of Georgia professor who attended the dinner, which capped a Northwestern University symposium on the justice’s jurisprudence.

In 2004 and 2006, Justice Stevens wrote Supreme Court opinions holding that Guantanamo prisoners could challenge their detention before neutral judges, and that while in custody were entitled to the minimal protections of the Geneva Conventions. His rulings stressed that the laws of war—of which the Geneva Conventions, ratified by the U.S., form a principal part—cannot be ignored simply because the government found it “convenient” to do so.

But on Thursday, Justice Stevens indicated that those same laws of war permit the armed forces to kill an enemy commander who remains engaged in active hostilities against the U.S., as Navy Seals did on their May 2 operation inside Pakistan.  “I have not the slightest doubt that it was entirely appropriate for U.S. forces to do,” Justice Stevens said, according to Ms. Amann’s account.

via Justice Stevens Okays bin Laden Killing – Law Blog – WSJ.