Publications

07.14.16 | Blog Posts

SCOTUS Quid Pro Quo Analysis in McDonnell May Broadly Affect Bribery and Insider Trading Prosecutions

The Insider: White Collar Defense and Securities Enforcement

Last month’s decision from the Supreme Court in McDonnell v. United States takes federal prosecutors to task for applying federal criminal corruption laws in too broad a manner. The Court’s decision makes clear that distasteful or offensive conduct does not necessarily rise to the level of criminality. The Court’s insistence on a “specific and focused” benefit suggests that the government may have to rethink prosecutions ranging from all forms of bribery as well as insider trading. [...]

Related Lawyers: Robert J. Anello

07.12.16 | Blog Posts

Recent Trials Highlight DOJ's Challenges in Prosecuting Individuals for Corporate Misconduct

The Insider: White Collar Defense and Securities Enforcement

Since the 2008 financial crisis, the Department of Justice has faced criticism for not aggressively prosecuting individuals and companies for alleged wrongdoing. The Department has acknowledged and addressed this criticism in speeches and policy statements, notably the September 2015 Yates Memorandum, which declared a heightened commitment to prosecuting individuals for white-collar crimes and, as I have written elsewhere, a heightened expectation of corporate cooperation in the investigation of employee conduct. [...]

Related Lawyers: Jonathan S. Sack

07.07.16 | Articles

Implications of 'Countrywide' for Mail and Wire Fraud Prosecutions

New York Law Journal

Prosecutors tend to interpret white-collar criminal statutes expansively, and sometimes courts push back. In this article, we discuss the Second Circuit’s decision reversing the $1.2 billion judgment against Bank of America’s Countrywide mortgage unit, and explain how a relatively obscure principle of statutory interpretation, the “common law canon,” led to the Second Circuit’s unexpected decision.

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

06.21.16 | Articles

Requirements for Invoking the Common Interest Doctrine

New York Law Journal

Attorneys and their clients often rely on the “common interest” doctrine to shield from disclosure communications among allied parties and their counsel. Although invocation of the common interest doctrine is seldom challenged through litigation in the Southern District of New York, its contours are not as well-defined as many lawyers assume. This article discusses the requirements for the invocation of the common interest doctrine, highlights two recent decisions, and touches on the aspects of the doctrine that remain to be defined.

Related Lawyers: Judith L. Mogul, Edward M. Spiro

06.09.16 | Articles

White-Collar Practitioner’s Guide to the Supreme Court’s Term

New York Law Journal

The Supreme Court’s 2015 Term promises significant developments for the white-collar bar. The court already has issued three decisions that are noteworthy for white-collar practitioners, with the most significant likely yet to come. In this article, we discuss the Supreme Court's recent white-collar decisions as well as cases to be decided in the upcoming year, and consider the impact of Justice Antonin Scalia’s absence.

Related Lawyers: Robert J. Anello, Richard F. Albert

06.01.16 | Blog Posts

Insider Trading, Official Corruption, and Their Common Roots in Fraud

The Insider: White Collar Defense and Securities Enforcement

Insider trading and official corruption prosecutions—two of the cornerstones of recent white-collar enforcement efforts by the Department of Justice—have both generated sufficient doctrinal confusion to land them on the Supreme Court’s docket this year and next. This past April, the Court heard the appeal of former Virginia Governor Bob McDonnell from his corruption conviction, and next term, the Court is set to hear Bassam Salman’s appeal from his insider trading conviction. On the surface, these cases have little in common: McDonnell concerns what constitutes a sufficient “official action” to trigger criminal liability under anti-corruption laws, and Salman concerns what constitutes a sufficient “personal benefit” to trigger criminal liability under insider trading precedent. But beneath the surface, the legal doctrines at issue are related, in that both official corruption and insider trading cases are rooted in theories of fraud. Further, one of the fundamental principles of fraud—that a material misrepresentation is an element of the crime—could provide important guidance as to how these cases and others might be resolved. [...]

Related Lawyers: Brian A. Jacobs

05.23.16 | Articles

Accessing Records With Bank of Nova Scotia Summonses

New York Law Journal

In a recent interview, Acting Assistant Attorney General Caroline D. Ciraolo described the Tax Division’s continuing pursuit of individuals believed to have evaded their U.S. tax obligations through offshore accounts. Among other things, Ms. Ciraolo noted that, in the wake of the DOJ’s Swiss Bank Program, the Tax Division’s civil trial attorneys were seeking to enforce Bank of Nova Scotia summonses served on U.S branches of foreign banks. This article discusses the authority supporting the use of such summonses to avoid foreign bank secrecy laws and the implications of so-called Bank of Nova Scotia summonses looking forward.

Related Lawyers: Jeremy H. Temkin

05.10.16 | Articles

When Do Business Negotiations Cross the Line and Become Fraud?

New York Law Journal

The mail, wire and securities fraud statutes have a wide but not unlimited reach. An area of particular controversy is the application of these statutes to arm’s length business negotiations. In this article, we discuss several recent appellate decisions in which business negotiations have given rise to criminal fraud charges, and suggest that the line between acceptable negotiation and fraud warrants further judicial clarification.

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

05.06.16 | Blog Posts

FCPA Pilot Program: Missing the Big Picture

The Insider: White Collar Defense and Securities Enforcement

For decades, the government has been trying to incentivize companies to self-report illegal activity by dangling the carrot of reduced punishment. The Justice Department’s one-year Foreign Corrupt Practices Act “pilot program,” announced on April 5, 2016, is the latest iteration of this enforcement technique. Although a valiant effort to formalize a practice known to white collar practitioners, the program does not address some of the more significant variables that are of importance to corporate decision makers. [...]

Related Lawyers: Robert J. Anello

04.20.16 | Articles

Service of Process by Email on Defendants Located Outside the U.S.

New York Law Journal

A plaintiff seeking to serve a defendant located overseas can face substantial, sometimes insurmountable logistical challenges. In this article, we discuss several recent Southern District of New York decisions in which plaintiffs, frustrated by elusive defendants or uncooperative foreign governments, have been permitted to serve defendants through email under Federal Rule of Civil Procedure 4(f)(3).

Related Lawyers: Edward M. Spiro, Judith L. Mogul

04.14.16 | Blog Posts

Ransomware, Cyberattacks, and Hacking in the Health Care Industry: Lessons from a Letter to the FBI

The Insider: White Collar Defense and Securities Enforcement

The last several weeks have brought a host of alarming revelations regarding the vulnerability of some of the most confidential data that corporations and legal entities maintain on their servers. Most notably, the story of the so-called “Panama Papers” continues to attract substantial media attention, as the theft of approximately 2.6 terabytes of data from the Panamaian law firm Mossack Fonseca, and its disclosure to the International Consortium of Investigative Journalists, has already caused the resignation of one international leader and threaten the fates of several more. Perhaps less provocative, but no less significant, is a recent Wall Street Journal article reporting that hackers illegally accessed the computer networks at some of the most respected and prestigious law firms in the United States, apparently for the purpose of stealing confidential information that in turn can facilitate insider trading. [...]

Related Lawyers: Robert M. Radick

04.06.16 | Articles

Rise of ABA Task Force’s ‘Shadow Sentencing Guidelines’

New York Law Journal

Because the federal sentencing guidelines applicable to fraud cases are widely acknowledged to be broken and dysfunctional, particularly in high-loss cases, sentencing judges may increasingly seek other sources to help guide their discretion. In this article, we discuss the thoughtful alternative framework offered by a blue-ribbon panel of judges, law professors and practitioners, and highlight recent court decisions applying those “shadow guidelines.”

Related Lawyers: Richard F. Albert, Robert J. Anello

04.05.16 | Blog Posts

Why Do Federal Agents Still Take Interview Notes by Hand?

The Insider: White Collar Defense and Securities Enforcement

Anyone who has attended a law school lecture in the last decade knows this sight: row after row of students typing on laptops, each taking down a nearly verbatim transcript. At the same time, anyone who has attended a witness interview—a proffer—in a federal criminal investigation in the last decade knows this sight: a group of Assistant U.S. Attorneys and law enforcement agents, all asking questions, while a single agent takes down occasional notes by hand on a yellow pad. Student notes can impact grades; agent notes can put people in jail. Yet the typed student notes will almost invariably be more complete than the handwritten agent notes. Why are law students taking better notes than federal agents? [...]

Related Lawyers: Brian A. Jacobs

03.28.16 | Blog Posts

Charging Too Many Counts Hurts Prosecutions

The Insider: White Collar Defense and Securities Enforcement

In a recent criminal case in New York County in which I was involved, the District Attorney’s Office charged one of the defendants with 106 counts – 105 felonies and one misdemeanor (two other defendants were charged with over 100 counts each). The case was a complex fraud case and the prosecution charged violations of five different statutes: (1) scheme to defraud in the first degree (one count), (2) grand larceny in the first degree (15 counts), (3) falsifying business records in the first degree (88 counts), (4) the Martin Act (the New York securities fraud statute) (one count), and (5) conspiracy in the fifth degree (one count – a misdemeanor). [...]

Related Lawyers: Lawrence S. Bader

03.23.16 | Articles

DOJ Tax Division Today: Interview With Acting Assistant Attorney General

New York Law Journal

Early last year, after almost two decades in private practice, Caroline Ciraolo joined the Tax Division of the Department of Justice, and she has served as the Acting Assistant Attorney General since February 25, 2015. In that capacity, she leads the DOJ’s civil and criminal tax enforcement efforts. In this article, Ms. Ciraolo discusses the DOJ’s Swiss Bank Program, the Tax Division’s commitment to offshore enforcement and its challenges going forward.

Related Lawyers: Jeremy H. Temkin

03.02.16 | Articles

Justice Scalia’s Approach to Textualism in White-Collar Law

New York Law Journal

The late Justice Antonin Scalia was the leading expositor of textualist methodology over the last several decades. Whatever one’s view of textualism and of Justice Scalia, every judge and lawyer (for the government and the defense) must now reckon with the precise language of the statute at issue and be prepared to analyze the relevant words of the statute in context. In light of Justice Scalia’s recent death and the ongoing debate over his judicial philosophy, this article reflects upon the Justice’s influence on the interpretation of white-collar statutes and highlights the significant impact of his textualist approach.

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

02.18.16 | Articles

A Smaller World, but Personal Jurisdiction Still Matters

New York Law Journal

When the Supreme Court decided Daimler AG v. Bauman two years ago, it effectively re-wrote the rules on personal jurisdiction, abandoning the “continuous and systematic” contacts inquiry for general jurisdiction. Daimler announced a new rule, providing that only in “an exceptional case” could a corporation’s operations in a state be so substantial as to subject it to general jurisdiction other than where it is incorporated or has its principal place of business. This article discusses a number of recent decisions from the Southern District of New York that illustrate the sea change wrought by Daimler on New York’s personal jurisdiction jurisprudence.

Related Lawyers: Judith L. Mogul, Edward M. Spiro

02.17.16 | Blog Posts

GSK and the U.K.’s Competition and Markets Authority: A New Agency Arrives in Health Care Enforcement

The Insider: White Collar Defense and Securities Enforcement

It does not take much these days to notice that law enforcement has gone global. The transnational nature of prosecutions, enforcement actions, and regulatory proceedings can be seen in a host of recent cases. The prosecution of the FIFA scandal, for example, involves not just the U.S. Department of Justice but also the active participation of the Swiss authorities, and the governments of Costa Rica and Colombia have recently announced their own independent investigations. Similarly, the alleged manipulation of interbank lending rates has led to prosecutions by the United Kingdom’s Serious Fraud Office and the U.S. Department of Justice, as well as actions by a less well-known enforcement agency, Japan’s Financial Services Agency. And as this blog noted over two years ago, the Chinese Ministry of Public Security led an investigation into Glaxo Smith Kline’s alleged bribing of officials and doctors to utilize the company’s drugs, which ultimately resulted in a $500 million corporate fine and a suspended sentence for a Glaxo executive who otherwise would have been relegated to a Chinese prison. [...]

Related Lawyers: Robert M. Radick

02.10.16 | Blog Posts

Non-Prosecution Agreements: Reserved for VIPs?

The Insider: White Collar Defense and Securities Enforcement

Should individuals who cooperate with the government in high-profile cases get better deals than individuals who cooperate in cases that do not make the headlines? The rules laid out in the Department of Justice’s U.S. Attorney’s Manual suggest that the answer—at least in the government’s view—is “yes.” [...]

Related Lawyers: Brian A. Jacobs

02.03.16 | Articles

Potential Impact of Supreme Court’s Upcoming Political Quid Pro Quo Case

New York Law Journal

The Supreme Court's grant of certiorari in the highly-publicized case of former Virginia Governor, Robert McDonnell, to examine the contours of a quid pro quo arrangement under federal law will have an impact on more than just federal political corruption prosecutions. A number of other federal criminal statutes, including the Anti-Kickback Enforcement Act and the Foreign Corrupt Practices Act, include a quid pro quo requirement. In this article, we discuss the McDonnell case and its implications.

Related Lawyers: Robert J. Anello, Richard F. Albert


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