Westbrook publishes article on Foreign Corrupt Practices Act

Photograph: Amy Deen Westbrook.Professor Amy Westbrook's article, "Double Trouble: Collateral Shareholder Litigation Following Foreign Corrupt Practices Act Investigations," has been published at 73 Ohio State Law Journal 1217 (2012). A recent surge in government enforcement of the U.S. Foreign Corrupt Practices Act (FCPA) has increased opportunities for private plaintiffs to bring collateral civil actions. In response to FCPA investigations, shareholders now routinely file derivative suits, securities fraud class actions, or both. To date, FCPA-based shareholder litigation has enjoyed limited success. Nevertheless, a number of the suits have been settled, some for amounts exceeding the government penalties paid by the company for the FCPA violations. Shareholder litigation based on company behavior that violates the FCPA is significant because the threat of private litigation increases the impact of an FCPA violation by increasing a company's liability, parallel shareholder litigation may subtly expand FCPA liability, and shareholder lawsuits may also be of more general doctrinal significance. Professor Westbrook examines recent shareholder litigation based on company behavior that violates the FCPA, introduces the FCPA and the current surge in its enforcement, examines the increase in shareholder actions based on FCPA violations, analyzes shareholder derivative and securities fraud class action lawsuits in terms of what shareholders are alleging and how their suits are faring, and draws preliminary conclusions about the legal consequences of increased collateral shareholder litigation based on FCPA violations. (Posted January 31, 2013)