Clear Channel Generally Prevails In FCPA-Related Insurance Coverage Dispute
In 2023, Clear Channel Outdoor Holdings (a public subsidiary of iHeartMedia and one of the world’s largest outdoor advertising corporations) resolved a $26.1 million FCPA enforcement action.
The SEC stated: “This matter concerns violations of the anti-bribery, recordkeeping, and internal accounting controls provisions of the FCPA by Clear Channel in connection with the actions of its agent, a former indirect, majority-owned Chinese subsidiary, Clear Media Limited. From at least 2012 through 2017, Clear Media bribed Chinese government officials, both directly and through third parties, to obtain concession contracts required to sell advertising services to public and private sector clients for display on public bus shelters, street furniture, and billboards. In addition, Clear Media used sham intermediaries and false invoices to generate cash for off-book consultants engaged to win advertising business from government and private customers. From at least 2012 through 2019, Clear Channel failed to ensure that sufficient internal accounting controls were in place at Clear Media. Clear Channel received approximately $16.4 million in benefits as a result of Clear Media’s improper payments, which were inaccurately recorded as legitimate business expenses in Clear Channel’s consolidated books and records.”
General Cable In Coverage Dispute With Insurers Regarding Prior FCPA Matter
In 2016, General Cable Corporation (a Kentucky based manufacturer and distributor of cable and wire) resolved a parallel DOJ and SEC enforcement action concerning conduct in Angola, Bangladesh, Indonesia, Thailand, China, and Egypt by agreeing to pay approximately $75 million. (See here for the prior post).
Recently, General Cable filed a civil lawsuit against Scottsdale Indemnity Company (Nationwide) alleging that the insurer has failed to provide coverage for settlement payments and defense costs associated with the Foreign Corrupt Practices Act and related matters.
The complaint alleges in pertinent part: