Monday, November 8, 2010

Esquenazi Challenges DOJ's "Foreign Official" Interpretation

Like many FCPA defendants (corporate and individual), Joel Esquenazi allegedly violated the FCPA's anti-bribery provisions by providing something of value, not to a foreign government official, but to an employee of an alleged state-owned or state-controlled enteprise ("SOE").

In a December 2009 indictment (here), the DOJ alleged that: (i) "Telecommunications D'Haiti ("Haiti Teleco") was the Republic of Haiti's state-owned national telecommunications company;" (ii) Robert Antoine and Jean Rene Duperval were, at various times, "the Director of International Relations of Haiti Teleco" and a "foreign official as that term is defined in the FCPA;" and (iii) Esquenazi, and others provides, things of value to these "foreign officials" in order to obtain or retain business in violation of the FCPA's anti-bribery provisions.

Unlike most FCPA defendants (corporate and individual), including others charged with Esquenazi in the same indictment, Esquenazi is putting the DOJ to its burden of proof, specifically as to the FCPA's "foreign official" element.

In a November 2nd motion to dismiss the indictment (here), Esquenazi "respectfully moves the Court to dismiss the indictment for failure to state a criminal offense and, in the alternative, for vagueness with respect to who would constitute a 'foreign official' within the meaning of the" FCPA.

The motion states as follows.

"The instant indictment fails to state a criminal offense because it alleges that the recipients of the improper payments were 'foreign officials' because they were employees of an entity 'owned' by the Republic of Haiti. Such a definition of 'foreign official' is unsupported by the text or the purpose of the FCPA. The FCPA is a public bribery statute which criminalizes improper payments to officials performing a public function. Mere control or partial control or ownership (or partial ownership) of an entity by a foreign government no more makes that entity's employees 'foreign officials' than control of General Motors by the U.S. Department of the Treasury makes all GM employees U.S. officials." (emphasis in original).

Alternatively, the motion states as follows.

"... the Court should dismiss the indictment on the grounds that the FCPA's definition of 'foreign official,' which includes employees of any foreign government 'department, agency or instumentality,' is unconstitutionally vague. Especially in the context of third country under a coup such as Haiti was under at the relevant time, a vague definition of 'foreign official' to include employees of entities solely based on partial or even full government 'ownership' of those entities would unfairly sweep nearly all economic activity within the scope of the statute."

Richard J. Diaz, an attorney from Coral Gables, Florida, filed the motion on behalf of Esquenazi.

*****

For prior entries regarding the Haiti Teleco case see here.

As noted in a prior post, an interesting twist is that Haiti Teleco is currently 60% owned by Viettel, a telecommunications company run by Vietnam's military (see here).

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