Unrelated in substance, two bits of guidance issued yesterday that criminal defense lawyers ought to be aware of. First, the Department of Justice issued its long-awaited “guidance” on the Foreign Corrupt Practices Act, a law that has been so lacking in cognizable parameters as to render it incapable of compliance or review. Vague much, Congress?
But the government is here to help, and issued its guidance. All 130 pages of guidance. Imagine how much fun it would be sharing these guidelines at parties with your friends!
Fortunately, WSJ Lawblog’s Ashby Jones has done a bit of vetting of the verbs and provided some outtakes.
Illuminating stuff, right? Your guy in United Arab Emirates can now buy the sheik’s nephew a cup of coffee and offer taxi fare back to the palace, just in case his Rolls Royce breaks down. Let the senior VP from France pay for the steak tartare.
In enacting the FCPA, Congress recognized that bribes can come in many shapes and sizes—a broad range of unfair benefits—and so the statute prohibits the corrupt “offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value to” a foreign official.
An improper benefit can take many forms. While cases often involve payments of cash (sometimes in the guise of “consulting fees” or “commissions” given through intermediaries), others have involved travel expenses and expensive gifts. Like the domestic bribery statute, the FCPA does not contain a minimum threshold amount for corrupt gifts or payments. Indeed, what might be considered a modest payment in the United States could be a larger and much more significant amount in a foreign country.
Regardless of size, for a gift or other payment to violate the statute, the payor must have corrupt intent—that is, the intent to improperly influence the government official. [It] . . . is difficult to envision any scenario in which the provision of cups of coffee, taxi fare, or company promotional items of nominal value would ever evidence corrupt intent, and neither DOJ nor SEC has ever pursued an investigation on the basis of such conduct. (Page 14-15)
And when you pay that courtesy call on the War Lord in Somalia whose guns are trained on your people stringing fiber optic cable between the last two poles standing, you need not be left empty handed.
Just hand him a double bacon burger (double is okay, right DOJ, if it’s on the dollar menu?) and pray his people don’t spray your linemen with hollow point bullets.
A small gift or token of esteem or gratitude is often an appropriate way for business people to display respect or each other. Some hallmarks of appropriate gift-giving are when the gift is given openly and transparently, properly recorded in the giver’s books and records, provided only to reflect esteem or gratitude, and permitted under local law. Items of nominal value, such as cab fare, reasonable meals and entertainment expenses, or company promotional items, are unlikely to improperly influence an official, and, as a result, are not, without more, items that have resulted in enforcement action by DOJ or SEC. (Page 15)
But what everyone really wants to know is what triggers an FCPA prosecution, and the DOJ doesn’t disappoint, providing its 9 factors:
- the nature and seriousness of the offense, including the risk of harm to the public;
- the pervasiveness of wrongdoing within the corporation, including the complicity in, or the condoning of, the wrongdoing by corporate management;
- the corporation’s history of similar misconduct, including prior criminal, civil, and regulatory enforcement actions against it;
- the corporation’s timely and voluntary disclosure of wrongdoing and its willingness to cooperate in the investigation of its agents;
- the existence and effectiveness of the corporation’s pre-existing compliance program;
- the corporation’s remedial actions, including any efforts to implement an effective corporate compliance program or improve an existing one, replace responsible management, discipline or terminate wrongdoers, pay restitution, and cooperate with the relevant government agencies;
- collateral consequences, including whether there is disproportionate harm to shareholders, pension holders, employees, and others not proven personally culpable, as well as impact on the public arising from the prosecution;
- the adequacy of the prosecution of individuals responsible for the corporation’s malfeasance; and
- the adequacy of remedies such as civil or regulatory enforcement actions. (Page 53)
Turning to guidance from the Seventh Circuit in the ever-perplexing restitution issues in child porn cases stemming from “Amy,” Judge Richard Posner provides a fascinating explanation of how to address the hundreds of cases where millions of dollars of restitution have been imposed.
Got that? Barges. Fires. Briar patches. Stay with me here.
But we don’t have to get deeper into the proximate cause briar patch. Before a judge gets to the issue of proximate cause, he has to determine what the defendant caused. Amy’s and Vicky’s brief misses this point in stating (a proposition not wholly true, but we’ll ignore that qualification) that “a tortfeasor cannot say he should escape liability for sinking a barge because someone else’s acts would have sunk the barge regardless.” The statement is an allusion to a discussion in W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 52, p. 347 (5th ed. 1984), of a class of tort cases best illustrated by cases concerning not barges but “multiple fires of negligent origin. If each fire would have destroyed the plaintiff’s property, so that all the fires were sufficient conditions of the harm but none was a necessary condition, nevertheless the firemakers would be jointly liable whether or not they were acting in concert.” Greene v. Doruff, 660 F.3d 975, 979 (7th Cir. 2011). Otherwise there would be two wrongdoers, a harm from the wrongdoing—yet no liability.
Is this such a case? Amy’s and Vicky’s brief states that “apportioning [their] harm among the numerous past, present, and future defendants is all but impossible. But all of them have contributed to Amy and Vicky’s images going ‘viral’ on the internet.” It’s an open question whether the defendant in the present case uploaded any of Amy’s and Vicky’s images to the Internet—if he didn’t, then he didn’t contribute to those images “going viral.” If we consider only his having seen those images, and imagine his being the only person to have seen them, Amy’s and Vicky’s losses would not have been as great as they were.
Lest you think this is just the needless murder of words leading nowhere (with the gratuitous smack in the head to Bryan Garner, in the last paragraph of page 14, in his capacity as editor of Black’s Law Dictionary and co-author with Justice Scalia in the curious tome, Reading Law : how not to write like Posner), Judge Posner actually answers the question eventually.
But if the defendant in this case is not responsible for the viewing of the images of Amy and Vicky by even one person besides himself, joint liability would be inappropriate. Amy and Vicky argue that psychological harm is always “indivisible.” But it isn’t. If separate fires join and burn down the house, the harm is indivisible: the house is gone, and all the firemakers are liable even though any one of the fires would have destroyed the house. And in our distribution example, the distributors may be jointly liable though again the entire harm might have occurred had there been only a single distributor. But often psychological harm can be greater or less, and it would have been less in this case if instead of tens of thousands of images of Amy’s and Vicky’s rapes being viewed on the Internet one image of each had been viewed by one person, the defendant.
Still less than clear? Boy, are you demanding.
To summarize: The defendant’s prison sentence is affirmed. The calculation of the crime victims’ losses is affirmed too, except that the judge must determine how much to subtract from Amy’s losses to reflect payments of restitution that she has received in other cases. The order of restitution is vacated and the case remanded for a redetermination of the amount of restitution owed by the defendant; that will require, besides the subtraction we just mentioned, a determination whether the defendant uploaded any of Amy’s or Vicky’s images. The defendant will not be permitted to seek contribution from other defendants convicted of crimes involving pornographic images of the two girls. And Amy and Vicky will not be permitted to intervene in the district court.
So there you are. Problem solved. Tomorrow, guidance from the government on how to screw in a light bulb in a union courthouse.