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SQM’s $62.5 Million Ripple


Foreign Corrupt Practices Act settlement amounts are one obvious consequence of FCPA non-compliance and tend to generate the most headlines. However, as has been discussed on these pages for years  including in this article “FCPA Ripples”, settlement amounts tend to be a relatively modest consequence of the overall financial ramifications of FCPA scrutiny and enforcement.

Pre-enforcement action professional fees and expenses are often 3-5 times (and sometimes higher) the actual FCPA settlement amount and post-enforcement action professional fees and expenses quickly add up as well.

In addition, many instances of FCPA scrutiny result in shareholder litigation – whether a derivative action against officers and directors for alleged breaches of fiduciary duty and/or a securities fraud action.

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From The Civil Litigation Docket

Judicial Decision

In 2011, Tenaris S.A. (a company headquartered in Luxembourg with American Depository Receipts listed on the New York Stock Exchange) resolved an approximate $9 million Foreign Corrupt Practices Act enforcement action regarding conduct in Uzbekistan (see here for the prior post).

The company’s shares remain traded on the NYSE and in connection with an alleged Argentine bribery scheme the company (along with various executives) were sued by plaintiff shareholders alleging securities fraud.

This post summarizes the allegations in connection with the Argentine bribery scheme as well as a recent decision in the E.D. of N.Y. dismissing certain securities fraud claims against the company while allowing certain claims to proceed. (See 2020 WL 6018919)

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Next Up For Herbalife – The Plaintiffs’ Lawyers

Greedy Lawyers

It is as predictable as the sun rising in the east and dogs barking.

In the aftermath of a Foreign Corrupt Practices Act enforcement action (or mere instances of FCPA scrutiny), plaintiffs’ lawyers representing shareholders on a contingent fee basis announce “investigations” or file securities fraud claims against the company and/or certain officers or directors. Such FCPA-related claims are frequently dismissed, but the “investigations” continue and claims continue to be filed.

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Courts Dismisses Bribery Related Securities Fraud Action Against Glencore And Various Executives


In mid-2018 Glencore (a commodities company incorporated in the United Kingdom and headquartered in Switzerland with common stock that trades on the New York based over-the-counter market) disclosed that it was under scrutiny by the U.K. Serious Fraud Office and DOJ. (See here for the prior post).

Soon thereafter, the company’s share price fell and sure as the sun rises in the east and dogs bark, attorneys representing shareholders filed securities fraud claims against the company and certain executives.

One such action was filed in the U.S. District Court in New Jersey alleging that Glencore and certain executives made false and /or misleading statements and/or failed to disclose facts relating to bribery schemes Glencore allegedly engaged in in the Democratic Republic of Congo, Venezuela and Nigeria.

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Citgo Turns Plaintiff And Sues FCPA Violator For Bribing Its Employees


As highlighted in this prior post, in May 2019 Jose Manuel Gonzalez Testino pleaded guilty to, among other charges, one count of conspiracy to violate the Foreign Corrupt Practices Act and one count of violating the FCPA for providing things of value to Citgo Petroleum Corp. (a subsidiary of Petroleos de Venezuela S.A. – the Venezuelan state-owned oil company).

Recently, Citgo turned plaintiff and sued Testino and his associated company Petroleum Logistics Service Corp. (PLS) for bribing its employees.

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