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Harry Cassin
Publisher and Editor

Andy Spalding
Senior Editor

Jessica Tillipman
Senior Editor

Bill Steinman
Senior Editor

Richard L. Cassin
Editor at Large

Elizabeth K. Spahn
Editor Emeritus

Cody Worthington
Contributing Editor

Julie DiMauro
Contributing Editor

Thomas Fox
Contributing Editor

Marc Alain Bohn
Contributing Editor

Bill Waite
Contributing Editor

Shruti J. Shah
Contributing Editor

Russell A. Stamets
Contributing Editor

Richard Bistrong
Contributing Editor

Eric Carlson
Contributing Editor

Keeping Courts Clean

Compliance programs don’t always (or even usually) cover how overseas counsel are hired, supervised and paid. But they should. A year ago, the Supreme Court denied cert in U.S. v. Kay, leaving in place the Justice Department’s expansive view of the FCPA’s business nexus element (the meaning of “assist in obtaining or retaining business”). That cleared the way for prosecutors to target bribes to foreign judges and court workers in all kinds of foreign cases.

We liked what Larry Buterman had to say earlier this week about FCPA enforcement actions in the U.N. oil for food cases (here). And we noticed he co-wrote an article in September about overseas judicial corruption. So we asked his advice. Here — in his own words — is what he told us:
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As American and other companies subject to the FCPA expand into foreign markets, they become increasingly susceptible to the risk of foreign litigation. The reality is that in many countries, payments to judges and judicial officials are standard litigation practices. Organizations must recognize that foreign judges and judicial officials are “foreign officials” for purposes of the FCPA — especially given the broad interpretation the U.S. government has adopted for that term.

Thus, organizations must be vigilant to ensure that all those who litigate on their behalves in foreign countries do not make any payments to judges and judicial officials.

The U.S. government has already shown its willingness to expand the reach of the FCPA in order to root out all types of foreign corruption. The FCPA appears to be the most promising legal tool at its disposal to combat bribery in foreign courts. Given the prevalence of judicial corruption overseas, it may only be a matter of time before the DOJ’s prosecutors turn their attention to the problem.

Common sense dictates that foreign local counsel be treated by companies the same way they treat any suppliers, agents or distributors with respect to the FCPA.
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A copy of “Foreign Judicial Corruption and Liability for Local Counsel,” co-authored by Howard B. Epstein and Lawrence E. Buterman and originally published in the New York Law Journal (September 9, 2009) can be downloaded here.

View our series about judicial corruption here.
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1 Comment

  1. Great post as ever. As a junior lawyer based in Europe around 20 years ago we were handling some litigation in Italy. Our judgment was suspended on Christmas Day – a rare case of an Italian judge working overtime. We asked our local counsel 'how' – his reply 'not how, but how much'.


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