United States v. Hoskins

• Decision Date: 13 August 2015
• Docket Number: Criminal No. 3:12cr238 (JBA).
• Citation: 123 F.Supp.3d 316
• Parties: UNITED STATES of America v. Lawrence HOSKINS.
• Court: U.S. District Court — District of Connecticut

123 F.Supp.3d 316

UNITED STATES of America

v.Lawrence HOSKINS.

Criminal No. 3:12cr238 (JBA).

United States District Court, D. Connecticut.

Signed Aug. 13, 2015.

Daniel S. Kahn, U.S. Department of Justice, Washington, DC, for United States of America.

Alejandra De Urioste, Christopher J. Morvillo, David Raskin, Clifford Chance U.S. LLP, New York, NY, Brian E. Spears, Nathan J. Buchok, Spears Manning, LLC, Southport, CT, for Lawrence Hoskins.

RULING ON DEFENDANT'S SECOND MOTION TO DISMISS THE INDICTMENT

JANET BOND ARTERTON, District Judge.

Defendant Lawrence Hoskins moves [Doc. # 254] to Dismiss Count One of the Third Superseding Indictment [Doc. # 209] on the basis that it charges a legally invalid theory that he could be criminally liable for conspiracy to violate the Foreign Corrupt Practices Act ("FCPA"), 15 U.S.C. § 78dd–1 et seq., even if the evidence does not establish that he was subject to criminal liability as a principal, by being an "agent" of a "domestic concern." Relatedly, the Government moves [Doc. # 232] in limine to preclude Defendant from arguing to the jury that it must prove that he was the agent of a domestic concern because the Government contends that Defendant can also be convicted under theories of accomplice liability. For the reasons that follow, Defendant's Motion to Dismiss Count One of the Third Superseding Indictment will be granted in part to preclude Defendant's FCPA conspiracy prosecution from being de-linked from proof that he was an agent of a domestic concern and the Government's Motion in Limine is denied.

I. Background

The facts of this case are set forth in detail in the Ruling [Doc. # 190] on Defendant's First Motion to Dismiss the Indictment and will be repeated only as necessary for the legal analysis herein. Briefly, Mr. Hoskins is alleged to have participated in a bribery scheme that spanned from 2002 through 2009 for Alstom Power, Inc. ("Alstom Power U.S."), a company headquartered in Windsor, Connecticut, to secure a $118 million project to build power stations for Indonesia's state-owned and state-controlled electricity company, Perusahaan Listrik Negara, known as the Tarahan Project.

From October 2001 through August 2004, Mr. Hoskins was employed as a Senior Vice President for the Asia Region by Alstom UK and assigned to Alstom Resources Management S.A. in France where he is alleged to have "performed functions and support services for and on behalf of various other Alstom subsidiaries, including Alstom Power US." (3d Indictment ¶ 3.) It is alleged that Mr. Hoskins's "responsibilities at Alstom included oversight of the hiring of consultants in connection with Alstom's and Alstom's subsidiaries' efforts to obtain contracts with new customers and to retain contracts with existing customers in Asia, including the Tarahan Project" and "[t]hus HOSKINS was an agent of a ‘domestic concern,’ Alstom Power US, as that term is used in the FCPA." (Id. ¶¶ 3, 13.) It is in this capacity that Mr. Hoskins is alleged to have been responsible for approving and authorizing payments to "consultants" retained for the purpose of "pay[ing] bribes to Indonesian officials who had the ability to influence the award of the Tarahan Project contract." (Id. ¶¶ 7–8.)

On July 31, 2014, Defendant Hoskins moved [Doc. # 149] to dismiss the Second Superseding Indictment [Doc. # 50] in its entirety, contending, in relevant part, that the indictment failed to allege that Mr. Hoskins, as an employee of a non-U.S. Alstom subsidiary, could have been an "agent of a domestic concern" subject to liability under the FCPA. The Court denied [Doc. # 190] Defendant's motion, holding that the indictment alleged that Mr. Hoskins worked as an agent of Alstom Power U.S. despite being employed by an overseas subsidiary and the "existence of an agency relationship is a ‘highly factual’ inquiry" and it was "for a jury at trial in the first instance, and not the Court on a motion to dismiss, to determine whether the Government has proven Defendant to have been an ‘agent’ " of Alstom Power U.S. (Ruling on 1st Mot. Dismiss at 14–16.)

As relevant here, the Third Superseding Indictment altered the charging language of Count One, the FCPA conspiracy count, which originally charged Mr. Hoskins with "being a domestic concern and an employee and agent of [Alstom Power U.S.]" and replaced it with the allegation that Mr. Hoskins conspired by acting "together with" a domestic concern to violate 15 U.S.C. § 78dd–2 (prohibiting domestic concerns from using interstate commerce corruptly to promise, authorize, or give anything of value to a foreign official) and 15 U.S.C. § 78dd–3 (prohibiting any person from taking acts in furtherance of the corrupt scheme while in the United States). (Compare 2d Indictment ¶ 26(a), with 3d Indictment ¶ 26(a).)¹ Defendant now moves to dismiss only Count One of the Third Superseding Indictment.

II. Discussion

Defendant contends that with the Third Superseding Indictment "the government makes plain ... its view of the law" that Mr. Hoskins "could be prosecuted for conspiracy to violate the FCPA even when he himself was not subject to the statute." (Def.'s Mem. Supp. [Doc. # 254–1] at 4.) The Government maintains that the Third Superseding Indictment is adequately pled under the governing pleading standards and faults Defendant for attempting "to assign to the Government a particular ‘view of the law’ based on [the] change" from the Second to Third Superseding Indictments. (Gov't's Opp'n at 8–9.). But the Government acknowledges that its theory is that "even were the jury to find that the defendant was not an ‘agent’ of a domestic concern, [it] may still convict the defendant on one or more of the remaining accomplice theories," i.e., "aiding and abetting, causing, and Pinkerton " liability and moves in limine to preclude Defendant from arguing to the contrary. (Gov't's Mot. to Preclude Def. from Arguing that Agency is Sole Basis for Conviction [Doc. # 232] at 4, 7.)

Therefore, these two motions put before the Court the question of whether a nonresident foreign national could be subject to criminal liability under the FCPA, even where he is not an agent of a domestic concern and does not commit acts while physically present in the territory of the United States, under a theory of conspiracy or aiding and abetting a violation of the FCPA by a person who is within the statute's reach.² The Court concludes that the answer is "no" and that accomplice liability cannot extend to this Defendant under such circumstances and thus Defendant's Motion to Dismiss Count One is granted in part and the Government's Motion in Limine is denied.

A. FCPA

As explained in greater detail below, the FCPA in its current form prohibits bribery of foreign governmental officials and has three jurisdictional bases: (1) where a "domestic concern"³ or U.S. "issuer" of securities, or any officer, director, employee, or agent thereof (regardless of their nationality) makes use of U.S. interstate commerce in furtherance of a corrupt payment, 15 U.S.C. §§ 78dd–1(a), 78dd–2(a) ; (2) where a U.S. citizen, national, or resident acts outside the United States in furtherance of a corrupt payment, regardless of whether they make use of U.S. interstate commerce, id. § 78dd–2(i) ; and (3) where any other person, while in the territory of the United States, acts in furtherance of a corrupt payment, regardless of nationality and the use of interstate commerce, id. § 78dd–3.

Defendant maintains that these provisions demonstrate that "Congress deliberately intended to exclude [non-resident foreign nationals] from the statute's reach so long as they did not act while in the territory of the United States (Section 78dd–3 ) and did not fall into an enumerated class of persons with threshold ties to a U.S. securities issuer (Section 78dd–1 ) or U.S. domestic concern (Section 78dd–2 )" and "the government cannot nullify that intent by charging such individuals with conspiracy to violate that statute." (Def.'s Mem. Supp. at 5–7.) The Government does not dispute the premise of Defendant's argument—that if Defendant is not proven to be an agent of a domestic concern, he cannot be held liable directly under the FCPA—but it maintains that "[a]s a general rule, the conspiracy and accomplice liability statutes apply to classes of persons who lack the capacity to commit a violation of the underlying substantive crime" and the two narrow exceptions to this rule do not apply in this case. (Gov't's Opp'n at 1.)

B. The Gebardi Principle

Theories of accomplice liability under the general conspiracy statute, 18 U.S.C. § 371, and aiding and abetting statute, 18 U.S.C. § 2, generally apply across the United States Code to impose liability upon those who conspire with or aid and abet in the commission of any federal crime.⁴ Thus, ever since 18 U.S.C. § 2 was enacted in 1909, "every time Congress has passed a new criminal statute the aider and abettor provision has automatically kicked in and made the aiders and abettors of violations of the new statute punishable as principals." United States v. Pino–Perez, 870 F.2d 1230, 1233 (7th Cir.1989). Likewise, 18 U.S.C. § 371, which has existed in essentially the same form since 1867, generally criminalizes a conspiracy to commit any federal offense. Gebardi v. United States, 287 U.S. 112, 121 n. 4, 53 S.Ct. 35, 77 L.Ed. 206 (1932) ; Iannelli v. United States, 420 U.S. 770, 777, 95 S.Ct. 1284, 43 L.Ed.2d 616 (1975) ("Conspiracy is an inchoate offense, the essence of which is an agreement to commit an unlawful act.").

In Gebardi, the Supreme Court considered whether a woman could be convicted of conspiracy to violate the Mann Act, which outlaws transporting across state lines "any woman or girl for the purpose of prostitution or debauchery, or for any other immoral purpose' " where she acquiesced to her own transport. 287 U.S. at 118, 53 S.Ct. 35 (quoting 18 U.S.C. § 398(2)). The Supreme Court explained that the conspiracy statute generally...