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MAY 2014 - FCPA
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What Your Clients Don't Know Can Hurt Them: A Recap

by Danielle Lackey

Last month, a well-received and well-attended panel event at L’Ermitage Hotel highlighted the most impactful (and to some, unexpected) consequences of the Foreign Corrupt Practices Act (FCPA) for globally-expanding companies, their lawyers, and their employees. This topic has risen to the forefront – and inspired lively discussion among panelists and attendees – due to heightened government scrutiny and enforcement of anti-corruption laws.  

Co-hosted by Maria Shtabskaya of Morgan Stanley, CadenceCounsel, Littler Mendelson, and WLALA, the event began (and ended!) with some animated mingling over cocktails, followed by a panel discussion among specialists in mergers and acquisitions, securities, employment, and the FCPA.

Moderated by Marc Morgenstern (Chairman of CadenceCounsel and long-time securities and corporate lawyer), the panel consisted of: Nina Marino (Founding Partner at Kaplan Marino, white collar criminal defense attorney, and WLALA board member), Gina Saviola (Occidental Petroleum Corporation, Senior Corporate Compliance Counsel), and Heather Peck (Littler Mendelson, management-side labor and employment attorney).

The panelists led the audience through an analysis of a hypothetical company’s response, through the eyes of its CEO, general counsel, and outside employment and white collar counsel, to uncovering FCPA violations on the heels of an international acquisition. The revelations from the panel that sparked most questions and surprise included: 

1. There is no concept of materiality in the FCPA. Sending flowers to a foreign official’s spouse, for example – a non-cash gift of very small financial value – can constitute a violation.

2. The FCPA applies to both public and private companies.

3. FCPA anti-bribery provisions prohibit offers, promises or payments of anything of value, directly or indirectly, to “foreign officials.” Because some governments (e.g., China, Russia) maintain some degree of ownership or managerial interest in most companies within their countries, nearly anyone – even a receptionist – can be considered a “foreign official.” 

Danielle Lackey is President and CEO of CadenceCounsel, Inc., a national legal staffing group whose talent community of experienced lawyers support law firms (and their lawyers) – bridging the gap between fixed firm capacity and variable client demand. With support from Cadence Ad Hoc CounselTM, law firms can supplement their high-end practice and capabilities to nimbly respond to the ebb and flow of a busy law practice.