Professional melting pot

Reuben Guttman Articles, Whistleblowers Blog

DUBLIN — At the old Jameson Distillery, lawyers from across the globe danced into the night listening to a band from Long Island pumping out the music of the Irish rockers U2.

The International Bar Association — which is meeting in the Irish capital — is a melting pot of nationalities, languages, styles, and legal systems. The record turnout of more than 5,000 international delegates is perhaps, more than anything, a reflection of the global economy and the financial crisis — a reminder that the impact of regulatory dereliction does not confine itself to geographic boundaries.

International crimes

Even on the way to the conference centre, a taxi driver pointed out the headquarters of the agency charged with picking up the pieces of the country’s property crash and dealing with troubled real estate assets.
At a meeting of the IBA’s Anti-corruption Section, money laundering, the US Foreign Corrupt Practices Act, UK anti-bribery legislation and compliance enforcement with anti-corruption laws in Africa were all discussed. Those who came late were turned away at the door to a session that left some delegates standing.
‘The crimes are international, the victims are international, the float money is international, but the laws are not,’ argued UK lawyer Brian Spiro of London-based law firm BCL Burton Copeland.

Uniformity calls

The melding of different legal systems or calls for uniformity of laws are constant topics. At a meeting of the Antitrust Section, lawyers on a panel clashed over the application of US laws and the jurisdiction’s contingency fee system, whereby lawyers can be paid based on the level of damages recovered. Stephen Susman from US national law firm Susman Godfrey, probed European colleagues over whether they can take a contingency interest in cases they refer to US lawyers who file suit in America. There was no clear response from a panel of lawyers from UK, Ireland and Poland.
At a meeting sponsored by the Banking and Securities Law Sections, lawyers from Asia, North America and Europe chatted over lunch. ‘I don’t know any other organisation where you can have the opportunity to meet lawyers from all over the world,’ said Michael Bulach from Luxembourg firm Wilgden Partners. ‘It’s an opportunity to network and learn about systems of law that could come to our country.’

http://www.globallegalpost.com/blogs/commentary/professional-melting-pot-87309557/

Puckering Up

Reuben Guttman Articles, Whistleblowers Blog

“Whether to blow or not to blow – that intriguing issue triggered heated debate at a session on criminal fraud and the global economic recession at this week’s International Bar Association annual meeting” in Dublin, Ireland Reuben Guttman reports.  See his October 2, 2012 blog in The European Lawyer.

Should the US practice of paying bounties to whistleblowers be adopted by other countries?
Currently three US laws provide for bounties to be paid to individuals or entities providing information leading to the recovery of government money. The Internal Revenue’s code allows the Treasury Department to pay individuals that provide information enabling the government to collect unpaid taxes. The False Claims Act provides for bounties to be paid to those who have brought suit in the name of the government against entities or individuals that have filed or caused to be filed false statements causing the payout of monies which — in whole or in part — came from the government.

And, the Dodd-Frank Amendments provide for the payment of bounties to those whose original information or analysis enables the Securities and Exchange Commission to collect sanctions against those that have violated securities laws including the Foreign Corrupt Practices Act, which proscribes the bribery of foreign government officials by companies trading their stock on US exchanges.

http://www.globallegalpost.com/blogs/commentary/puckering-up-46704300/

“Backing Barack”

Reuben Guttman Articles, Whistleblowers Blog

The US President wins some heavyweight economic support as Reuben Guttman sees the curtain rise on the International Bar Association’s annual gathering in Dublin, Ireland.  See Reuben Guttman’s October 1, 2012 blog in The European Lawyer.

The International Bar Association opened its annual convention with keynote speaker and Nobel Prize winning economics professor Joseph Stiglitz announcing his support for the re-election of US President Barack Obama.

Speaking before several thousand attorneys from across the globe, Prof Stieglitz called for additional regulation of the banking and financial services sectors. ‘The first fiscal stimulus worked but it was too small,’ he told delegates. ‘We need another; we cannot afford not to do another stimulus.’

No choice

Prof Stiglitz’s support for Obama came as a surprise response to a question from a British lawyer. ‘Clearly Obama is better,’ he said. ‘When compared to the alternative there is no choice.’ But Prof Stiglitz also said that Mr Obama could have done ‘more with the restructuring of home mortgages’.
The Nobel Prize winner went on to compare the conduct of the banks to gambling, which is why ‘regulation is so important’.
A recent New York Times comment article — co-authored by Prof Stiglitz and economist Mark Zandi — noted that the president’s housing policies have ‘fallen short’ but that ‘Mitt Romney hasn’t offered any meaningful new proposals to aid distressed or underwater homeowners’.
Here in Dublin, when pressed, he made his ultimate political choice clear.

Political gridlock

While Prof Stiglitz urged more regulation, he expressed concern that political gridlock may preclude timely government intervention. ‘People say they believe in free markets but one person’s freedom is the right not to be injured by others,’ said Prof Stiglitz.

He continued by commenting that the ‘disparity in income brought about by the economic crisis means that there will be a disparity in political clout’. And he urged IBA members to respond by making sure that there will always be access to justice for those without the economic means.

It was a particularly intriguing observation given the controversy caused by the US Supreme Court’s 2010 ruling in Citizens United v Federal Elections Commission, which expanded the rights of corporations to make independent expenditures to influence the outcome of federal elections. The 2012 election marks the first test of that judgment on a US presidential race.

http://www.globallegalpost.com/blogs/commentary/backing-barack-91190962/

Expanded Protection for Whistleblowers: California Amends its False Claims Act

Dr. Caroline Poplin Articles, Whistleblowers Blog

On August 16, 2012, the California Assembly passed a bill (AB 2492) amending California’s state False Claims Act, Cal. Gov’t Code §§ 12650-12656 (“CAL FCA”) to largely conform to the provisions of the federal False Claims Act (“FCA”).  According to the Deficit Reduction Act of 2005, states with FCAs “at least as effective” as the federal FCA qualify for an additional 10 percent of any recoveries related to false Medicaid claims.  Due to the recent changes in the federal FCA as a result of the Fraud Enforcement and Recovery Act of 2009 (“FERA”), the Patient Protection and Affordable Care Act (“ACA”), and the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), states which seek to qualify for the additional payments must be proactive in ensuring that their FCAs are “at least as effective” as the federal FCA by the March 31, 2013 deadline.

The proposed amendments to the CAL FCA would expand both the liability of defendants and the rights of qui tam plaintiffs in a number of ways, including broadening the definition of “original source” and increasing protections for whistleblowers.  .

Some of the key amendments include:

  • Allowing the Attorney General to override the public disclosure bar.  The CAL FCA would permit the California Attorney General (“AG”) to prevent dismissal of a CAL FCA claim based on publicly disclosed information by “opposing” dismissal.
  • Expanding the definition of “original source.”  The CAL FCA definition would broaden to include individuals who have voluntarily disclosed to the state the information upon which a claim is based, or have knowledge that is independent of, and “materially adds” to, publicly disclosed allegations of false claims.
  • Broadening the definition of “claim” to include “contractor, grantee, or other recipient, if the money, property, or service is to be spent or used on a state or any political subdivision’s behalf or to advance a state or political subdivision’s program or interest . . . .”;
  • Incorporating the federal FCA’s definition of an “obligation”: An obligation includes retention of an overpayment, thereby giving rise to liability under the CAL FCA for retention of an overpayment;
  • Statute of limitations/relation back:  The CAL FCA would provide that, for statute of limitations purposes, if the AG files a complaint in intervention, it will relate back to the filing date of the relator’s complaint;
  • Making relators eligible for an award even if they planned and initiated the violation upon which the CAL FCA action was based; 
  • Eliminating the requirement that a claim must have been presented to an officer, employee, or agent of the state;
  • Clarifying that the CAL FCA’s anti-retaliation provisions apply when relators are discriminated against for furthering an action under the CAL FCA or for trying to stop a violation of the CAL FCA;
  • Granting relief to relators who are discriminated against, including reinstatement with the same seniority status, twice the amount of back pay plus interest, and compensation for special damages.
  • Defendant can recover attorneys’ fees:  clarifying an existing provision allowing defendants to recover attorneys’ fees if the defendant prevails in a CAL FCA case and the court finds that the claim was clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.

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