Feb. 14, 2024

New Year, Not So New Anti-Kickback Statute Enforcement Trends at the DOJ

Judging by 2023’s criminal investigations and civil actions under the federal Anti-Kickback Statute and the False Claims Act, medical businesses should be on their guard in 2024. In this guest article, Lowenstein Sandler lawyers Scott B. McBride and Jessica M. Terry survey the DOJ’s recent pursuit of such violations in the healthcare industry and draw conclusions about what to expect in 2024. See “Implications of the Updates to the Pharmaceutical Research and Manufacturers of America Code” (Sep. 29, 2021).

SAP’s $220‑Million Settlement Offers Clues on Compliance Expectations

German software company SAP SE recently entered into a three-year deferred prosecution agreement with the DOJ. The case is the DOJ’s second coordinated resolution with South African authorities in just over a year. It is also the second time that SAP has been recognized for its cooperation and remediation, which, according to Acting Assistant AG Nicole M. Argentieri, was incentivized by the DOJ’s coordinated international efforts and its corporate enforcement policies. This article examines the SAP case and offers insight into where regulators are looking next to incentivize companies to be good citizens, with insights from Withersworldwide, Miller & Chevalier, Davis Polk and Compliance Systems Legal Group. See “Gartner’s Settlement for FCPA Violations in South Africa Raises Important Issues” (Jun. 21, 2023).

U.S. Sanctions Against Russia Expand to Target Foreign Financial Institutions

The U.S. crackdown on Russia’s purchases of military materials entered a more comprehensive phase in December 2023 with Executive Order 14114 (EO). Under the EO, effective exclusion from the U.S. financial system is now the penalty for financial institutions, in whatever country, that facilitate such transactions or otherwise continue to host accounts for entities and individuals sanctioned for those purchases. Expected to be enforced in a considered, inter-agency manner, the EO will make life harder for third-country institutions hoping to maintain relations both with the U.S. and its global foes. This article explores the EO’s impact with insights from Perkins Coie, Akin and Morgan Lewis. See “Measures Against Russia Pose Serious Compliance Challenges” (Sep. 27, 2023).

Rising Risks for PE Firms to Monitor Amidst Changing Antitrust, Whistleblower and Sanctions Landscape

The Biden administration has been very focused on private equity (PE) firms and has invoked previously unused enforcement tools to target the industry, including lawsuits based on conduct by a firm’s portfolio company. With greater public scrutiny of PE firms generally, and their investments in industries like healthcare in particular, firms should be aware of new legal risks from regulators and private plaintiffs alike. Firms seeking to avoid regulatory scrutiny or enforcement actions – and the potentially steep legal fees or penalties that accompany them – should be particularly aware of new developments in the areas of antitrust, False Claims Act violations and Office of Foreign Assets Control sanctions compliance. This guest article from MoloLamken attorneys Lauren M. Weinstein, Lauren F. Dayton and Robert Y. Chen details the recent threats posed via each of those avenues and offers scenarios that GCs and CCOs of PE sponsors should avoid to mitigate those risks. See “U.S. Regulators Focus on Labor Impacts in Proposed Antitrust Changes” (Oct. 25, 2023).

Whistleblowing Directive and U.A.E. Efforts Emerge As Key Anti-Corruption Trends

Anti-corruption advances proliferate across the globe, including in the E.U., Middle East, APAC and Latin America. The efforts of the U.A.E. and Saudi Arabia in taking on corruption stand out, as do the challenges companies face in navigating a patchwork of whistleblowing regulations. Hogan Lovells’ Global Bribery and Corruption Outlook 2024 (2024 Outlook), which predicts a year of shifting enforcement dynamics, addresses these developments and others, including compliance challenges in Latin America’s automotive sector and China’s focus on healthcare corruption. Among developments noted in the Middle East, the 2024 Outlook highlights the U.A.E.’s possible imminent removal from the Financial Action Task Force’s “grey list.” Meanwhile, Transparency International’s 29th annual Corruption Perceptions Index (TI Index) also pinpointed some positive and negative anti-corruption developments in Middle Eastern, European and Latin American nations. This article distills key findings in the 2024 Outlook and TI Index, with insights from Hogan Lovells partner Randall Walker. See “Speak-Up Technology: Can It Move the Needle on Workplace Culture?” (May 10, 2023).

Former Senior White House Official and Morgan Stanley Executive Rejoins Davis Polk As White Collar Leader

Raul Yanes has rejoined Davis Polk as a partner in the New York office. Yanes will also serve as chair of the firm’s white collar defense & investigation’s practice. He arrives from Morgan Stanley. For insights from Davis Polk, see “Newly Signed Foreign Extortion Prevention Act Complements FCPA” (Jan. 3, 2024); and “FCPA Enforcement, Changes in 2023 Foretell a Busy Year Ahead” (Jan. 17, 2024).

Brown Rudnick Adds Former Federal Prosecutor As Partner in Washington, D.C.

Brown Rudnick has welcomed former federal prosecutor Steven Tyrrell as a partner in Washington, D.C. Tyrrell joins the firm’s white collar defense, investigations and compliance group. He arrives from Weil, Gotshal & Manges. For commentary from Tyrrell, see “Top FCPA Practitioners Share Strategies for Detecting, Preventing and Responding to Whistleblower Allegations” (Jun. 26, 2013).