Potpourri
Calavo Growers
As highlighted in this prior post, in early 2024 Calavo Growers, Inc. “a global leader in quality produce, including avocados, tomatoes and papayas, and a pioneer of healthy fresh-cut fruit, vegetables and prepared foods” disclosed:
“On January 16, 2024, the Company announced that its internal audit process had identified to the Audit Committee of the Board of Directors certain matters that the Board of Directors determined after fiscal year end merited enhanced evaluation. A Special Committee of the Board of Directors (the “Special Committee”) was established to commence an investigation, with the assistance of external legal counsel and external forensic accountants. The Special Committee determined that certain of those matters related to the Company’s operations in Mexico raised potential issues under the Foreign Corrupt Practices Act (“FCPA”). The Company voluntarily disclosed this ongoing investigation to the SEC and the DOJ, and the Company intends to fully cooperate with the SEC and the DOJ in connection with these matters.”
Once Again, Rebooting A Long-Standing FCPA Proposal, This Time In The Aftermath Of A Recent Disclosure By Calavo Growers
Including the first time I proposed this concept in 2010, this is the 12th time I have written this general post (see here, here, here, here, here, here, here, here, here, here and here for the previous versions). Until things change I will keep writing it which means I will probably keep writing this same general post long into the future.
The proposal is this: when a company voluntarily discloses an FCPA internal investigation to the DOJ and/or SEC and when one or both of the enforcement agencies do not bring an enforcement action, have the enforcement agency publicly state, in a thorough and transparent manner, the facts the company disclosed and why the enforcement agency did not bring an enforcement action based on those facts.
Calavo Growers – “Activity In The [SEC] Investigation Has Been Postponed”
Several prior posts have discussed the impact of President Trump’s Executive Order on upcoming or recently completed FCPA trials involving individuals. (See here, here, here and here).
What impact might the Executive Order have on existing corporate FCPA investigations by the DOJ or SEC?
Tough to tell as there is little in the public domain regarding such investigations.
Except of course public company filings – if the company chooses to disclose FCPA issues.
In what is believed to be the first filing by a company under existing FCPA scrutiny since the February 10th Executive Order, Calavo Growers disclosed yesterday that “activity in the [SEC] investigation has been postponed.”
Scrutiny Alerts And Updates
This post highlights a scrutiny alert regarding previous FCPA violator SQM and scrutiny updates regarding Calavo Growers (is it “boiling the ocean?) and the two instances of “monkey business” FCPA scrutiny involving Inotiv and Charles River.
SQM
As highlighted in this prior post, in 2017 Sociedad Quimica y Minera de Chile S.A. (SQM) (a chemical and mining company based in Chile with American Depository Shares listed on the New York Stock Exchange) resolved a $30.5 million FCPA enforcement action (DOJ and SEC) in relation to alleged conduct with Chilean officials.
SQM recently disclosed:
Is Calavo Growers “Boiling The Ocean”?
Not all companies under Foreign Corrupt Practices Act scrutiny disclose the fees and expenses to conduct an internal investigation.
In my estimation, approximately 25% of issuers do so.
Calavo Growers, Inc. has done so.