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WSJ: Esquenazi, Rodriguez will seek Supreme Court review

Image courtesy of the U.S. Supreme CourtSam Rubenfeld of the Wall Street Journal reported that Joel Esquenazi and Carlos Rodriguez, who were convicted for FCPA-related offenses in a scheme to bribe officials at Haiti’s state-owned telecom company, plan to file a petition this week for a writ of certiorari with the U.S. Supreme Court.

In May, a unanimous three-judge panel from the U.S. Court of Appeals for the 11th Circuit affirmed their convictions.

The court interpreted the FCPA's definition of "foreign official," which the statute says includes "any officer or employee of a foreign government or any department, agency, or instrumentality thereof."

In 2011, a jury in Miami found Esquenazi and Rodriguez guilty of bribing officials at Telecommunications D’Haiti. The jury convicted them of one count of conspiracy to violate the FCPA and wire fraud, seven substantive FCPA counts, one count of money laundering conspiracy, and 12 counts of money laundering.

Esquenazi was sentenced to 15 years in prison, the longest FCPA-related sentence ever handed down, and Rodriguez got seven years.

Esquenazi and Rodriguez argued on appeal that the DOJ's view of "foreign official" was overly expansive and beyond Congress's intent for the statute's coverage.

They said Haiti Teleco wasn't an "instrumentality" under the FCPA and that its directors, officers, and employees therefore weren't "foreign officials." If that was true, they argued, bribes paid to anyone at Haiti Teleco couldn’t violate the FCPA. 

The appeals court disagreed. It defined "instrumentality" as "an entity controlled by the government of a foreign country that performs a function the controlling government treats as its own."

“It’s always a long shot to get the Supreme Court to take a case, but we feel the issue of who qualifies as a ‘foreign official’ under the FCPA should be addressed and conclusively resolved now,” David Simon, a partner at Foley & Lardner who represented Rodriguez, told the Wall Street Journal.

Esquenazi and Rodriguez face long odds with their petition for certiorari, the WSJ's Rubenfeld said.

"The Supreme Court receives about 10,000 of them each year," he reported, "but grants it and hears oral arguments in only about 75 to 80 cases each nine-month term."

*     *     *

Esquenazi and Rodriguez aren't the first FCPA defendants to seek a Supreme Court review.

In 2013, the justices denied Frederic Bourke's petition for certiorari of his 2009 conviction for conspiracy to violate the FCPA and lying to FBI agents.

The U.S. Court of Appeals for the Second Circuit had denied Bourke's appeal and a request for a new trial.

He argued that prosecutors knowingly allowed a key witness to present false testimony to the jury and that the trial judge gave faulty jury instructions on the knowledge standard.

After the U.S. Supreme Court denied his petition, Bourke served a one-year prison and was released in March 2014.

And in 2008, the Supreme Court refused to review the Fifth Circuit Court of Appeals' decisions in U.S. v. Kay.

David Kay and Douglas Murphy, former executives of American Rice, Inc., were found guilty in 2005 of violating the FCPA by bribing Haitian officials in order to reduce their company's taxes.

They argued that the FCPA didn't apply to bribes to reduce taxes, or that if it applied, the "obtaining or retaining" language in the law (the business nexus element) is so ambiguous that enforcement in their case would be unfair.

After the Supreme Court turned down their request for a review, they were required to serve prison sentences -- 37 months for Kay and 63 months for Murphy.


Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.