Medical device maker Zimmer Holdings, Inc. said in an SEC filing yesterday that it can’t predict the outcome of DOJ and SEC investigations into its overseas sales practices.
The enforcement agencies opened their investigations in 2007.
In 2011, Zimmer received a subpoena from the SEC seeking documents and other records about sales activities in ‘substantially all’ countries in the Asia Pacific region where Zimmer operates.
On its website, Zimmer lists locations in China, India, Hong Kong, Taiwan, Thailand, Australia, and New Zealand.
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Indiana-based Zimmer Holdings, Inc. made the disclosure in its Form 10-Q filed with the SEC on November 6.
FCPA investigation: In September 2007, the Staff of the U.S. Securities and Exchange Commission (SEC) informed us that it was conducting an investigation regarding potential violations of the Foreign Corrupt Practices Act (FCPA) in the sale of medical devices in a number of foreign countries by companies in the medical device industry. In November 2007, we received a letter from the U.S. Department of Justice (DOJ) requesting that any information provided to the SEC also be provided to the DOJ on a voluntary basis. In the course of continuing dialogues with the agencies, we have voluntarily disclosed information to the SEC and DOJ relating to sales of our products by independent distributors in two South American countries. In the first quarter of 2011, we received a subpoena from the SEC seeking documents and other records pertaining to our business activities in substantially all countries in the Asia Pacific region where we operate. We have been responding to the subpoena and reporting to the government concerning our reviews in certain countries in the Asia Pacific region. We cannot currently predict the outcome of this investigation. If the result of the investigation is that we are found to be in violation of the FCPA, we could face significant monetary penalties or be required to take other remedial actions.
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