Government Contracts, Investigations & International Trade Blog : Government Contracts Lawyer & Attorney : Sheppard Mullin Law Firm : Bids, Licenses, Awards, Conflict of Interest.

By: Curt Dombek & Reid Whitten

On November 7, 2011, the U.S. State Department published a proposed rule amending the International Traffic in Arms Regulations (“ITAR”) by narrowing the categories of aircraft and related equipment controlled on the United States Munitions List (“USML”). Concurrently, the U.S. Department of Commerce, Bureau of Industry and Security (“BIS”) published a proposed rule adding five new Export Control Classification Numbers (“ECCNs”) to the Commerce Control List, which lists items controlled under the Export Administration Regulations (“EAR”). The two rules are linked, as the new ECCNs in BIS's proposed rule will cover those items carved out of the ambit of ITAR controls by the State Department’s proposed rule.   

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By Keith Szeliga and Christopher E. Hale

On December 2, 2011, Federal Acquisition Regulation Subpart 3.11 – Preventing Personal Conflicts of Interest for Contractor Employees Performing Acquisition Functions – takes effect. The new Rule requires contractors to screen for and prevent personal conflicts of interest when supporting Government acquisition functions. [1] The Rule also requires contractors to prohibit covered employees from utilizing non-public information for personal gain and to obtain from covered employees executed non-disclosure agreements prohibiting the dissemination of such information.

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By John M. Hynes

On November 1, 2011, Transparency International (“TI”) released its 2011 Bribe Payers Index (“BPI”), which ranks the countries whose companies are most likely to engage in bribery when doing business abroad. The BPI can serve as an important tool for companies in their efforts to avoid violations of the United States Foreign Corrupt Practices Act (“FCPA”).

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By Anthony N. Moshirnia

Blowing the whistle on alleged fraud against the Government does not entitle an employee to loot and disclose her employer’s records in violation of a confidentiality agreement – at least not in the Ninth Circuit. In an opinion handed down in March of this year, the Ninth Circuit refused to adopt a so-called “public policy exception to confidentiality agreements to protect [qui tam plaintiffs]” who misappropriate documents from their employers ostensibly to buttress claims brought under the federal False Claims Act (“FCA”). U.S. ex rel. Cafasso v. Gen. Dynamics C4 Sys., Inc., 637 F.3d 1047, 1061-62 (9th Cir. 2011). Though this opinion has been on the books since Spring, it remains relevant, and worth keeping an eye on, as it provides powerful ammunition against FCA plaintiffs that continue to tout the “public policy” exception as though it were unassailable. 

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By Thaddeus McBride & Cheryl Palmeri

On October 26, 2011, Joel Esquenazi was sentenced to 15 years in prison for committing and conspiring to commit both money laundering and violations of the Foreign Corrupt Practices Act (“FCPA”). Esquenazi is the former president of Terra Telecommunications Corporation (“Terra”), an international telecommunications company. According to the U.S. Department of Justice (“DOJ”), this is the longest prison sentence yet imposed in a case involving the FCPA.

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By John Chierichella

On October 26, 2011, Ryan E. Roberts of Sheppard Mullin was recognized by the Board of Contract Appeals Bar Association with its 2011 President’s Award. The award is given annually to the individual who has made the most significant contribution to BCABA during the previous year. Mr. Roberts received the award for his work in developing and editing the BCA Case Digests – a recurring addition to the BCABA’s quarterly publication, The Clause. Mr. Roberts oversees a staff of 18 authors who summarize every substantive decision of the ASCBA, CBCA, and PSBCA. The most recent editions of The Clause can be found here, and a complete list of awardees can be found here.
 

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By Thaddeus McBride & Cheryl Palmeri 

On October 5, 2011, the U.S. Department of Justice (“DOJ”) and Bridgestone Corporation (“Bridgestone”) filed a plea agreement in U.S. District Court in which Bridgestone admitted to violating the Sherman Antitrust Act (15 U.S.C. § 1) (“Sherman Act”) and the Foreign Corrupt Practices Act (18 U.S.C. § 371) (“FCPA”). Under the terms of the resolution, Bridgestone agreed to (i) plead guilty to violating the Sherman Act and the antibribery provisions of the FCPA, (ii) implement a comprehensive FCPA compliance program, and (iii) cooperate fully in the DOJ’s ongoing investigations of antitrust and FCPA violations resulting from the manufacture and sale of marine hose. Under the agreement, Bridgestone will pay a criminal fine of $28 million. In exchange, the DOJ agreed not to bring further charges against Bridgestone or its affiliates for acts taken before the date of the agreement in furtherance of the charged crimes.[1]

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