Skip to content


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

Russell A. Stamets
Contributing Editor

Richard Bistrong
Contributing Editor

Eric Carlson
Contributing Editor

Tom’s Retort: DOJ Does Help Buyers

Regarding the FCPA Blog’s post Buyers Face Impossible Choice about Opinion Release 08-02, I have to disagree with the conclusion that “Halliburton’s experience was discouraging for anyone with an acquisition program and a desire to comply with the FCPA.”

On the contrary, I would urge that Opinion Release 08-02 was a welcomed advance from the DOJ, which recognized the restrictions on companies in mergers and acquisitions, while allowing companies to maintain a strong and positive stance towards anti-corruption and compliance with the FCPA.

Your post goes on to focus on pre-acquisition Confidentiality Agreements as some type of restriction on information that can be made available to the DOJ if a violation of the FCPA is found. This is a Red Herring. The reason this is a Red Herring is found in the Opinion Release itself, which had a very aggressive time frame for Halliburton to investigate the acquisition target for potential FCPA violation, if it closed the transaction. It was this post-acquisition information which Halliburton agreed to turn over to the DOJ, not information obtained in the pre-acquisition due diligence. Put another way, once you acquire a company, you own it and you can investigate your own company and turn over any information that you find about your own company to the DOJ. You, as the company owner, are not bound by any confidentiality agreement regarding your own data.

There is nothing in Opinion Release 08-02 which would require a company following it to lose access to a DOJ Opinion Release. This position is further evidenced by the Johnson and Johnson (J&J) Deferred Prosecution Agreement (DPA) which had an 18 month window for J&J to perform a retrospective FCPA compliance audit of any company that it acquired during the pendency of its DPA. Opinion Release 08-02 provided Halliburton with a 6 month window to accomplish the same investigation. Both Opinion Release 08-02 and the J&J DPA mandate that the companies must disclose any FCPA violations which are discovered in these post-acquisition FCPA audits/investigations. This is fit and proper.

As to whether Expro “after reading such a threatening scenario, they ran from Halliburton and into the arms of” another suitor, I would posit that if a target company does not want to allow itself to be reviewed for FCPA violations, it is most probably because there is something they want to hide. No acquiring company would want to subject themselves to such successor liability, but more importantly such company probably does not have a culture of compliance. This means that an acquiring company could well have many more problems in the future. One of the functions of pre-acquisition due diligence is to provide enough information to evaluate the risks in acquiring a target company. I would speculate that it was Halliburton who decided the risk was too high.


Thomas Fox is the creator and writer of the widely-read FCPA Compliance and Ethics Blog. He has practiced law in Houston for 25 years. Tom writes and speaks nationally and internationally on FCPA compliance, indemnities and other forms of risk management for a worldwide energy practice, tax issues faced by multi-national U.S. companies, insurance coverage issues, and protection of trade secrets. His book Lessons Learned on Compliance and Ethics topped Amazon’s bestseller list for international law. He can be contacted here.

Share this post


1 Comment

  1. Couldn't disagree with you more. Basically you are incenting the acquirer to root around looking for problems. There are a ton of judgment calls in the FCPA area where targets that maintain legitimate compliance programs wouldn't want regulators shining a spotlight via the agent buyers. Who would? This is a totally unworkable framework and if I were the target, I'd run for the hills.
    It will be interesting to see if targets firm up the CA's and other deal docs to make sure this kind of hunting license doesn't occur, ala what is done in the environmental area where buyers are penalized for hunting for problems on the seller's nickel.

Comments are closed for this article!