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Richard L. Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Michael Scher
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Elizabeth K. Spahn Contributing Editor

Julie DiMauro Contributing Editor

Eric Carlson Contributing Editor

Michael Kuria Contributing Editor

Thomas Fox Contributing Editor

Philip Fitzgerald Contributing Editor

Marc Alain Bohn Contributing Editor

Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

Russell A. Stamets Contributing Editor

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« Hong Kong Protests As New Chief Exec Takes Office | Main | A Truly Global Anti-Corruption Tool »
Wednesday
Jul042012

Civil Complaint Against GE Energy Tossed

A federal judge threw out a whistleblower claim by a former country manager for Iraq against GE Energy (USA) who had alleged FCPA violations.

Khaled Asadi, a dual citizen of the United States and Iraq, was based in Amman, Jordan. He claimed he was fired by the GE subsidiary for telling supervisors and a company ombudsman about potential bribes to win work.

The judge in Houston ruled that Asadi wasn't covered by Dodd-Frank's Anti-Whistleblower Retaliation provisions. A whistleblower under Dodd-Frank, the judge said, is a person who complains to the SEC. Asadi, however, complained only to his supervisor and a GE ombudsman.

The judge also ruled against Asadi on substantive grounds. He had sought reinstatement, two times his back pay, and litigation costs and attorney fees.

General Electric Company settled an FCPA enforcement action with the SEC in July 2010. It paid $23.4 million in disgorgement, interest, and a civil penalty for violations of the FCPA's books and records and internal controls provisions. From 2000 to 2003, the SEC said, four GE subsidiaries paid $3.6 million in kickbacks to the prior Iraqi regime for medical supply and water purification contracts. The kickbacks violated the United Nation's oil-for-food program and weren't properly accounted for.

The GE subsidiaries named by the SEC were Marquette-Hellige and OEC-Medical Systems (Europa) AG, Ionics Italba S.r.L. (a then-subsidiary of Ionics), and Nycomed Imaging AS (a then-subsidiary of Amersham). Those subsidiaries are now known as GE Healthcare Ltd. and GE Ionics Inc. They weren't mentioned in Asadi's civil suit.

A copy of Judge Nancy F. Atlas' June 28, 2012 decision in Asadi v. G.E. Energy (USA), LLC can be viewed here.

_________

Our thanks to contributing editor Jessica Tillipman for a heads up about the decision.

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