This article was reprinted with permission
from FCPA Professor
Some background is necessary to place in context an
interesting development that is likewise relevant to the pending Eleventh
Circuit "foreign official" appeal by Joel Esquenazi and Carlos Rodriguez (see here for the prior
post linking to the full briefing in the case).
In terms of the number of individual criminal
defendants (9), the Haiti Teleco enforcement actions are the largest in
FCPA history (minus the manufactured Africa Sting case). The
FCPA charges in the enforcement actions were based on the theory that
Haiti Teleco was a "instrumentality " of the Haitian government, such that
Haiti Teleco employees were "foreign officials" under the FCPA.
Seven of the defendants pleaded guilty and two of the defendants,
Esquenazi and Rodriguez, exercised their constitutional right to a jury
trial and were found guilty of FCPA and related charges. As noted above,
both defendants have appealed their convictions to the Eleventh Circuit. [Disclosure
- I am providing pro bono expert services to defendants' counsel, including my
former law firm Foley & Lardner, relevant to the "foreign
In addition to the FCPA (and related) charges brought
against the above category of defendants, the DOJ also criminally charged three
"foreign officials" in connection with the matter (see this prior
post titled "Haiti Teleco Roundup" for additional details). Two of
the individuals pleaded guilty to non-FCPA offenses, and one "foreign
official," Jean Rene Duperval, was found guilty by a jury on various money
In short, 12 individuals were criminally charged, pleaded
guilty, and/or were found guilty based, in whole or in part, on the theory that
Haiti Teleco was an "instrumentality" of the Haitian government.
This prosecution theory of course is a main focus of the
Esquenazi and Rodriguez appeal in the Eleventh Circuit. As noted in this prior
post, shortly after their convictions and before their current appeal, a
stunning development occurred in the case as the Haitian Prime Minister
(Jean Max Bellerive) authored a declaration, on behalf of the Haitian Ministry
of Justice, concerning the "Legal Status of Teleco." (See here for
the declaration). The declaration asserted, among other things,
that "Teleco has never been and until now is not a state enterprise." The
declaration was dated ten days before the jury reached its
verdict in the Esquenazi and Rodriguez trial and subsequent filings in the
cases suggest that the origins of the declaration was in response to a letter
sent by Paul Calli (Carlton
Fields - then an attorney for Patrick Joseph (one of the "foreign
officials" who pleaded guilty in the case)) inquiring about the status of Haiti
Teleco and whether it was a private company or a government
In a further stunning development, and as noted in this
prior post, after the Bellerive declaration surfaced, the DOJ contacted the
Prime Minister and he filed a revised declaration (here),
in which he backtracked from many of his prior declaration statements, and
stated that he did not know his original declaration "was going to
be used in criminal legal proceedings in the United States or that it was going
to be used in support of the argument that [...] Teleco was not part of the
Public Administration of Haiti."
The trial court judge in the Esquenazi and Rodriguez
case denied defendants' request for a new trial and this denial is among
the issues on appeal in the Eleventh Circuit.
And now for the interesting and notable recent
development alluded to in this
Main Justice story.
Duperval, the key "foreign official" at the center
of the Haiti Teleco prosecutions, filed an appeal (here)
in the Eleventh Circuit earlier this week challenging his
convictions. One issue on appeal is stated as follows. "The
evidence was insufficient to prove beyond a reasonable doubt that Haiti
Teleco was a government instrumentality and that Jean Rene
Duperval was a foreign official as required to prove that a violation of
the Foreign Corrupt Practices Act generated proceeds of a specified unlawful
activity - a necessary predicate for the convictions on the money laundering
conspiracy and substantive money laundering charges."
Separately, Duperval's brief discusses the Bellerive
declarations in connection with his due process challenges. Among other
things, the brief notes that the DOJ's "explanation and Bellerive's statements
in his second declaration, are nothing short of disingenuous, border on the
nonsensical, and are expressly contradicted by the previous correspondence,
which established that Bellerive signed the first declaration in response to an
inquiry from an attorney representing Patrick Joseph ...". The
brief then asserts that "but for the government's unjustified interference with
Prime Minister Bellerive, Mr. Duperval could have availed himself of a
favorable witness to demonstrate quite simply that Teleco was not a government
instrumentality and he was not a foreign official."
Duperval's brief also challenges the sufficiency of
the trial court evidence regarding "foreign official" and whether
Duperval was a "foreign official as required to prove a charge of money
laundering related to the proceeds of a violation of the FCPA." The
substantive arguments on this issue largely mirror previous defense arguments
in the Lindsey Manufacturing and Carson "foreign official" challenges as well
as Esquenazi's and Rodriguez's arguments on appeal. Duperval's argument
includes discussion and several citations to my "foreign official" declaration
Another interesting aspect of Duperval's appeal is
his challenge that the "trial court erred in not charging the jury in
accordance with Duperval's proffered theory of defense instruction."
Specifically, Duperval argues that the trial court denied
Duperval's FCPA facilitation payments exception instruction. The
brief asserts that the "language in the instruction was extracted verbatim"
from the FCPA and that there was "ample evidence in the record to support the
giving of the instruction."
In this regard, it is interesting to note that in Judge
Keith Ellison's (S.D. Tex.) December 2012 Jackson / Ruehlen decision (see here for
the prior post regarding the SEC enforcement action) he concluded, in what is
believed to be an issue of first impression, that the SEC must bear the burden
of negating the facilitation payments exception.
Read more articles on the FCPA by Mike
Koehler at FCPA
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