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Lawrence Hoskins, a British citizen and former executive at a British subsidiary of a French multinational transportation and energy company, was convicted last November of money laundering and violations of the Foreign Corrupt Practices Act (FCPA). In a rarely granted judgment of acquittal last month, the district court sided with the defendant on the FCPA charges, finding that the government did not present sufficient evidence at trial to support the jury's guilty verdict on those charges. The decision will likely make it more difficult for the government to charge non-U.S. defendants in certain FCPA cases. The decision serves as a warning and a restraint on the Department of Justice's (DOJ) power to charge foreign nationals acting outside the United States.

Authors: Jennifer L. Achilles

The government indicted Hoskins in 2013 on charges that he had hired consultants to bribe Indonesian officials to grant a $118 million power contract to an American subsidiary of the French corporate parent. In the same decision in which it reversed the jury's conviction on the FCPA charges, the court upheld Hoskins's conviction on money laundering charges related to the same facts. Despite the fact that Hoskins is due to serve prison time on the money laundering charges, the court's reversal on the FCPA charges will likely have a profound effect on the DOJ's approach to charging non-U.S. defendants in FCPA cases.

The district court's acquittal was teed up by an interlocutory decision by the Second Circuit in 2018, which held that, in light of the fact that Hoskins did not travel to the United States while the bribery scheme was ongoing, he could only be liable for FCPA violations if he was found to be an agent of the American subsidiary that was trying to secure the Indonesian power contract. As a result, the district court's decision reads more like a case about agency law than the extraterritorial application of the FCPA.

The district court explained that a traditional agency relationship has three required elements: (1) a manifestation by the principal that the agent will act on his behalf with respect to a specific undertaking; (2) the agent's acceptance of the undertaking; and (3) an understanding by both parties that the principal will be in control of the undertaking.