16-1010-cr
     United States v. Hoskins
 1
 2                          UNITED STATES COURT OF APPEALS
 3                              FOR THE SECOND CIRCUIT
 4                                ____________________
 5
 6                                      August Term, 2016
 7
 8           (Argued: March 2, 2017                         Decided: August 24, 2018)
 9
10                                    Docket No. 16-1010-cr
11
12                                    ____________________
13
14   UNITED STATES OF AMERICA,
15
16                                      Appellant,
17
18   v.
19
20   LAWRENCE HOSKINS,
21
22                                      Defendant - Appellee. *
23
24                                    ____________________
25
26   Before: KATZMANN, Chief Judge, POOLER and LYNCH, Circuit Judges.
27
28            In this interlocutory appeal from a district court’s dismissal of part of one

29   count in a multi-count indictment, we are asked to decide whether the

30   government may employ theories of conspiracy or complicity to charge a


     *   The Clerk of Court is respectfully directed to amend the caption as above.
 1   defendant with violating the Foreign Corrupt Practices Act (“FCPA”), even if he

 2   is not in the categories of persons directly covered by the statute.

 3         We first decide that we have jurisdiction over the appeal under 18 U.S.C.

 4   § 3731. That statute, as amended, permits interlocutory appeals by the

 5   government when a part of a count of an indictment is dismissed.

 6         We then address the merits of the district court’s dismissal of the

 7   government’s FCPA charges. We determine that the FCPA defines precisely the

 8   categories of persons who may be charged for violating its provisions. The

 9   statute also states clearly the extent of its extraterritorial application. Because we

10   agree with the district court that the FCPA’s carefully-drawn limitations do not

11   comport with the government’s use of the complicity or conspiracy statutes in

12   this case, we AFFIRM the district court’s ruling barring the government from

13   bringing the charge in question. We REVERSE the district court’s holding on the

14   Second Object of the Conspiracy, because the government’s intention to prove

15   that Hoskins was an agent of a domestic concern places him squarely within the

16   terms of the statute and takes that provision outside our analysis on the other

17   counts.

18         Affirmed in part and Reversed in part.
                                                2
1


2   JUDGE LYNCH concurs in the opinion and files a separate concurring opinion.

3                              ____________________

                                SANGITA K. RAO, Department of Justice
                                (Michael J. Gustafson, First Assistant United
                                States Attorney, Leslie R. Caldwell, Assistant
                                Attorney General, David E. Novick, Assistant
                                United States Attorney, Sung-Hee Suh, Deputy
                                Assistant Attorney General, Andrew Weissmann,
                                Chief, Fraud Section, Daniel S. Kahn and Jeremy
                                Sanders, Attorneys, Fraud Section, on the brief),
                                Washington, D.C., for Appellant United States of
                                America.

                                CHRISTOPHER J. MORVILLO, Clifford Chance
                                US LLP (Daniel Silver and Benjamin Peacock, on
                                the brief), New York, N.Y., for Defendant-Appellee
                                Lawrence Hoskins.

                                Ira M. Feinberg and Derek Musa, on the brief,
                                Hogan Lovells US LLP, New York, N.Y., for
                                Amicus Curiae the New York Council of Defense
                                Lawyers in support of Defendant-Appellee Lawrence
                                Hoskins.

                                Jonathan Bach and Adam S. Gershenson, on the
                                brief, Cooley LLP, New York, N.Y., for Amicus
                                Curiae the New York Council of Defense Lawyers in
                                support of Defendant-Appellee Lawrence Hoskins.
4
5   POOLER, Circuit Judge:


                                          3
 1         In this case, we are asked to decide whether the government may employ

 2   theories of conspiracy or complicity to charge a defendant with violating the

 3   Foreign Corrupt Practices Act (“FCPA”), even if he is not in the category of

 4   persons directly covered by the statute. 1 We determine that the FCPA defined

 5   precisely the categories of persons who may be charged for violating its

 6   provisions. The statute also stated clearly the extent of its extraterritorial

 7   application.

 8         The FCPA establishes three clear categories of persons who are covered by

 9   its provisions: (1) Issuers of securities registered pursuant to 15 U.S.C. § 78l or

10   required to file reports under Section 78o(d), or any officer, director, employee, or

11   agent of such issuer, or any stockholder acting on behalf of the issuer, using

12   interstate commerce in connection with the payment of bribes, 15 U.S.C. § 78dd-

13   1; (2) American companies and American persons using interstate commerce in

14   connection with the payment of bribes, 15 U.S.C. § 78dd-2; and (3) foreign




     1Because the question before us is whether conspiracy and complicity charges
     can be used to extend liability beyond the categories delineated in the statute, we
     assume that Hoskins is not an agent of Alstom U.S. only for the sake of
     arguments advanced on appeal and express no views on the scope of agency
     under the FCPA.
                                              4
 1   persons or businesses taking acts to further certain corrupt schemes, including

 2   ones causing the payment of bribes, while present in the United States, 15 U.S.C.

 3   § 78dd–3.

 4         Because we agree with the district court that the FCPA’s carefully-drawn

 5   limitations do not comport with the government’s use of the complicity or

 6   conspiracy statutes in this case, we AFFIRM the district court’s ruling barring the

 7   government from bringing the charge in question. We REVERSE the district

 8   court’s holding on the Second Object of the Conspiracy, because the

 9   government’s intention to prove that Hoskins was an agent of a domestic

10   concern places him squarely within the terms of the statute and takes that

11   provision outside our analysis on the other counts.

12




                                              5
 1                                   BACKGROUND

 2      I. The Allegations

 3         The government alleges that several defendants, including Hoskins, were

 4   part of a scheme to bribe officials in Indonesia so that their company could

 5   secure a $118 million contract from the Indonesian government. Hoskins worked

 6   for Alstom S.A. (“Alstom”), a global company headquartered in France that

 7   provides power and transportation services During the relevant time, which was

 8   from 2002 to 2009, Hoskins was employed by Alstom’s UK subsidiary, but was

 9   assigned to work with another subsidiary called Alstom Resources Management,

10   which is in France.

11         The alleged bribery scheme centers on Alstom’s American subsidiary,

12   Alstom Power, Inc. (“Alstom U.S.”), headquartered in Connecticut. The

13   allegations are that Alstom U.S. and various individuals associated with Alstom

14   S.A. retained two consultants to bribe Indonesian officials who could help secure

15   the $118 million power contract for the company and its associates. Hoskins

16   never worked for Alstom U.S. in a direct capacity. But the government alleges

17   that Hoskins, while working from France for Alstom Resources Management,

18   was “one of the people responsible for approving the selection of, and
                                             6
 1   authorizing payments to, [the consultants], knowing that a portion of the

 2   payments to [the consultants] was intended for Indonesian officials in exchange

 3   for their influence and assistance in awarding the [contract.]” Third Superseding

 4   Indictment (hereinafter “Indictment”) ¶¶ 3, 8.

 5         The government alleges that several parts of the scheme occurred within

 6   the United States. The indictment alleges that one of the consultants kept a bank

 7   account in Maryland. 2 In some cases, funds for bribes allegedly were paid from

 8   bank accounts held by Alstom and its business partners in the United States, and

 9   deposited in the consultant’s account in Maryland, for the purpose of bribing

10   Indonesian officials. The indictment also states that several executives of Alstom

11   U.S. held meetings within the United States regarding the bribery scheme and

12   discussed the project by phone and email while present on American soil.

13         The government concedes that, although Hoskins “repeatedly e-mailed

14   and called . . . U.S.-based coconspirators” regarding the scheme “while they were

15   in the United States,” Hoskins “did not travel here” while the bribery scheme

16   was ongoing. Appellant’s Br. at 7.



     2Although not alleged in the indictment, the government also represents that
     one consultant was “based” in Maryland.
                                            7
 1      II. The Indictment

 2         The Third Superseding Indictment, the operative one in the case, brings

 3   twelve counts against Hoskins. This appeal concerns the first seven counts of the

 4   indictment.

 5         Count one charges Hoskins with conspiring to violate the FCPA. It alleges

 6   that Hoskins is liable because he was an agent of Alstom U.S., an American

 7   company, and, in that capacity, committed acts that violated the statute. It also

 8   alleges that, independently of his agency relationship with an American

 9   company, Hoskins conspired with the company and its employees, as well as

10   foreign persons, to violate the FCPA, and also aided and abetted their violations.

11   The Count focuses on two objects of the conspiracy, which correspond to two

12   provisions of the FCPA that Hoskins supposedly violated as an accomplice and

13   also conspired to violate. The first of the two FCPA provisions prohibits

14   American companies and American persons, as well as their agents, from using

15   interstate commerce in connection with the payment of bribes. 15 U.S.C. § 78dd-

16   2. The second prohibits foreign persons or businesses from taking acts to further

17   certain corrupt schemes, including ones causing the payment of bribes, while

18   present in the United States. 15 U.S.C.
                                               8
 1   § 78dd–3.

 2          Counts two through seven charge substantive violations of the FCPA,

 3   focusing on particular wire transfers from Alstom U.S.’s bank account to the

 4   consultants’ accounts. These counts all charge Hoskins with violations of 15

 5   U.S.C. § 78dd-2. The counts allege that Hoskins violated this provision as “an

 6   agent” of an American company or person, and also “by aiding and abetting”

 7   such a company or person. 3

 8       III.   Proceedings Below

 9          Before the district court Hoskins moved for dismissal of the first count of

10   the indictment. See United States v. Hoskins, 

(D. Conn. 2015).

11   He noted that the FCPA prescribes liability only for narrowly-circumscribed

12   groups of people—American companies and citizens, and their agents,

13   employees, officers, directors, and shareholders, as well as foreign persons acting

14   on American soil. Hoskins argued that the government could not circumvent

15   those limitations by charging him with conspiring to violate the FCPA, or aiding




     3The remainder of the indictment, which is not at issue in this appeal, charges
     Hoskins with one count of conspiracy to commit money, and four counts of
     money laundering.
                                            9
 1   and abetting a violation of it, if he did not fit into one of the statute’s categories of

 2   defendants. He thus moved for dismissal of Count One, as it charged that he was

 3   liable even if he did not fit into one of the statute’s categories. Hoskins, 

  Supp. 3d at 317, 319.

 5         The government filed a closely-related motion in limine regarding Counts

 6   Two through Seven. 

The motion sought to preclude Hoskins from

 7   arguing at trial that he could only be convicted of violating the statute under a

 8   conspiracy or aiding-and-abetting theory if the government first proved that he

 9   fell within one of the FCPA’s enumerated categories of defendants.

10         The district court granted Hoskins’s motion in part and denied the

11   government’s motion. See 

The court explained that, under Gebardi v.

12   United States, 

(1932), “where Congress chooses to exclude a class of

13   individuals from liability under a statute, the Executive may not override the

14   Congressional intent not to prosecute that party by charging it with conspiring to

15   violate a statute that it could not directly violate.” 

16   (internal quotation marks and alterations omitted). Upon a thorough

17   consideration of the text, structure, and legislative history of the FCPA, the

18   district court concluded that “Congress did not intend to impose accomplice
                                                10
 1   liability on non-resident foreign nationals who were not subject to direct

 2   liability” under one of the statute’s provisions. 

 3          The court thus dismissed Count One of the indictment to the extent that it

 4   sought to charge Hoskins with conspiring to violate Section 78dd-2 of the FCPA

 5   without demonstrating that Hoskins fell into one of the FCPA’s enumerated

 6   categories. 

also dismissed Count One to the extent it alleged that

 7   Hoskins conspired to violate Section 78dd-3, which prohibits acts “while in the

 8   territory of the United States,” because Hoskins had never entered the United

 9   States during the relevant period. 

n.14 (“[I]f Congress intended to limit

10   liability under this section to those within the territory of the United States, the

11   Government cannot circumvent this intention by resort to the conspiracy

12   statute.”). The district court denied Hoskins’s motion in part, however, because

13   the indictment charged him with conspiring to violate the FCPA, or aiding and

14   abetting a violation, as an agent of an American company, a category covered by

15   Section 78dd-2. 

n.1, 327. The court also denied the government’s motion

16   in limine. 

17          The government appeals all of the district court’s rulings.

18                                      DISCUSSION
                                               11
 1      I. Jurisdiction under 18 U.S.C. § 3731

 2            Hoskins first argues that the court has no jurisdiction over this

 3   interlocutory appeal. In the government’s view, the court has jurisdiction under

 4   18 U.S.C. § 3731, which permits the United States certain interlocutory appeals in

 5   criminal cases. The statute reads as follows:

 6            In a criminal case an appeal by the United States shall lie to a court
 7            of appeals from a decision, judgment, or order of a district court
 8            dismissing an indictment or information or granting a new trial after
 9            verdict or judgment, as to any one or more counts, or any part
10            thereof, except that no appeal shall lie where the double jeopardy
11            clause of the United States Constitution prohibits further
12            prosecution. . . . The provisions of this section shall be liberally
13            construed to effectuate its purposes.

14   18 U.S.C. § 3731. The previous version of Section 3731 did not include the phrase

15   “or any part thereof,” which was added by Congress in 2002. The legislative

16   history of the provision makes clear that, in making the change, Congress

17   intended to broaden the scope of interlocutory appeals the government could

18   bring:

19            This section clarifies that 18 U.S.C. § 3731 authorizes an appeal by
20            the United States, consistent with the Double Jeopardy clause,
21            whenever a district court enters an order dismissing or striking part
22            of an indictment or information. . . . [The pre-2002 version of] the
23            statute has generally been generously interpreted to allow
24            government appeals, even when its literal language does not clearly

                                                12
 1         extend to the case, such as where a district court has dismissed only
 2         a portion of a count such as a predicate act in a RICO count or an
 3         overt act in a conspiracy count. . . . However, one federal circuit has
 4         held that section 3731 does not permit any government appeals from
 5         the dismissal of only part of a count. See United States v. Louisiana
 6         Pacific Corporation, 

(10th Cir. 1997). In other cases,
 7         appellate review of orders dismissing predicate acts or overt acts has
 8         been denied where the dismissed acts could not themselves have
 9         been charged in separate counts. See United States v. Terry, 

10         (5th Cir. 1993); United States v. Tom, 

(2d Cir. 1986).

11         It is time to resolve these conflicting results definitively. The reach of
12         section 3731 should clearly be extended to orders dismissing
13         portions of counts. Although the Solicitor General, who must
14         approve all appeals by the United States to a court of appeals, only
15         seldom authorizes appeals from partial dismissals of counts in
16         criminal cases, there is no reason not to permit the government to
17         appeal when the issue involved is important and determined by the
18         Solicitor General to be worthy of presentation to a higher court.
19         Indeed, there are some cases where the dismissal of a predicate act
20         or overt act may substantially weaken the government’s ability to
21         prove its case. The proposed amendment would therefore insert the
22         phrase “or any part thereof” in section 3731 so as to make clear that
23         dismissals of any part of a count are subject to appeal by the United
24         States in appropriate circumstances.

25   H.R. Rep. No. 107-685, at 188 (2002) (Conf. Rep.), reprinted in 2002 U.S.C.C.A.N.

26   1120, 1140-41 (hereinafter “2002 Conference Report”). Following the 2002

27   amendment, the First and Ninth Circuits have recognized the statute’s clear

28   reach over government requests to appeal dismissals of portions of counts in an

29   indictment. United States v. DeCologero, 

, 20 (1st Cir. 2004) (“The first

                                               13
 1   paragraph of the statute allows (in pertinent part) an appeal from a district

 2   court’s dismissal of an indictment ‘as to any one or more counts, or any part

 3   thereof’—the ‘any part’ language having been added in 2002 in part to resolve a

 4   circuit split . . . .” (quoting 18 U.S.C. § 3731 (2003)); United States v. Morales, 

  App’x 734, 736 (9th Cir. 2012) (“The statute was amended in 2002 to permit

 6   appeals from any “order of a district court [ . . . ] dismissing an indictment [ . . . ]

 7   or any part thereof.”).

 8          Hoskins argues, based on our rulings in United States v. Margiotta, 

  131 (2d Cir. 1981), and United States v. Tom, 

(2d Cir. 1986), that the

10   court lacks jurisdiction to hear the appeal under Section 3731. Margiotta and Tom

11   laid down the rule that “the Government may appeal when an order precludes

12   consideration of an independent ground for a conviction.” 

13   (internal quotation marks omitted). This rule permitted some appeals when a

14   district court dismissed something less than a full count of an indictment. We

15   explained that “an independent ground for a conviction” need not always be

16   “formally pleaded as a separate count in the indictment,” 

  140, and that dismissal of a “ground for a conviction” would be appealable even

18   if not set out as a separate count.
                                                 14
 1          But, under the rule stated in Margiotta and Tom dismissal of a theory of

 2   liability did not always remove a separate ground for a conviction, and thus did

 3   not always give rise to a government appeal. As long as some path remained for

 4   the defendant to be convicted under a given charge, the appeal was

 5   impermissible. For example, in Margiotta, we did not allow the government to

 6   appeal from the district court’s dismissal of the theory that the defendant was

 7   liable as a principal for violation of the Hobbs Act when he was also charged

 8   with aiding and abetting Hobbs Act violations. 

We reasoned that

 9   “[a]ider and abettor activity . . . is . . . punishable . . . to the same extent as activity

10   of a principal,” and so “the court’s jury instruction concerning the Hobbs Act

11   charges does not strike from the case an independent basis of liability.” 

in Tom, we dismissed an appeal from a district court’s dismissal of

13   some, but not all, allegations of racketeering acts that undergirded a charge

14   under the Racketeer Influenced and Corrupt Organizations Act (“RICO Act”).

, 71.

16          In light of Congress’s 2002 amendments to Section 3731, Tom and Margiotta

17   are no longer authoritative regarding appeals from dismissals of portions of

18   indictments. First, Congress’s statement that appeals may be taken from
                                                 15
 1   dismissal of “any part” of a count of an indictment plainly conflicts with the rules

 2   stated in those cases, which did not permit appeals from dismissals of some parts

 3   of indictments. Second, the 2002 Conference Report rejected the rule established

 4   in Tom. See 2002 Conference Report at 188. Given that Margiotta and Tom stated

 5   the same rule, Congress’s displeasure with both cases can be understood from

 6   the Conference Report.

 7         Under the revised version of Section 3731, the government’s appeal in this

 8   case may go forward. The district court dismissed portions of the indictment

 9   charging Hoskins with conspiracy to violate 15 U.S.C. § 78dd–2, or violation of

10   that provision as an accomplice, to the extent that the government could not also

11   show Hoskins was an agent of an American company or person, or a director,

12   employee, or stockholder of an American company. 

  317, 327. Additionally, the court dismissed part of the indictment alleging that he

14   conspired to violate 15 U.S.C. § 78dd–3, or violated that provision as an

15   accomplice, because the government conceded that the defendant did not enter

16   the United States during the relevant time period. 

n.14. Although the

17   court did not dismiss an entire count of the indictment, it dismissed two

18   significant parts of a count. That suffices for an appeal, given Congress’s
                                              16
 1   statement that review may be sought after dismissal of “any part” of a count of

 2   an indictment.

 3         Because we have jurisdiction under 18 U.S.C. § 3731 to review the

 4   dismissal of portions of Count One, we will exercise pendent appellate

 5   jurisdiction to review the district court’s denial of the government’s motion in

 6   limine. The doctrine of pendent appellate jurisdiction permits review of “all

 7   matters inextricably bound up with” an issue over which the court has

 8   jurisdiction. Lamar Advert. of Penn, LLC v. Town of Orchard Park, N.Y., 

  365, 371 (2d Cir. 2004); see also United States v. Zabawa, 

, 283 (10th Cir.

10   1994) (applying rules of pendent appellate jurisdiction to appeal taken under 18

11   U.S.C. § 3731). Because “the district court here denied” the government’s motion

12   in limine “for the very same reasons” that it granted in part Hoskins’s motion to

13   dismiss the indictment, the issues “are indeed inextricably intertwined with [the

14   issues] over which we have appellate jurisdiction.” 

. And

15   because “[i]t is surely in the interest of judicial economy” to consider both of the

16   motions in the same appeal, we will do so. 

The FCPA and the First Object of the Conspiracy



                                               17
 1         The central question of the appeal is whether Hoskins, a foreign national

 2   who never set foot in the United States or worked for an American company

 3   during the alleged scheme, may be held liable, under a conspiracy or complicity

 4   theory, for violating FCPA provisions targeting American persons and

 5   companies and their agents, officers, directors, employees, and shareholders, and

 6   persons physically present within the United States. In other words, can a person

 7   be guilty as an accomplice or a co-conspirator for an FCPA crime that he or she is

 8   incapable of committing as a principal?

 9             A. Conspiracy Liability

10         For purposes of this appeal, we assume that Hoskins was neither an

11   employee nor an agent of a domestic concern and therefore does not fall within

12   the terms of the statute. But accomplice and conspiracy liability are generally not

13   so limited. A get-away driver for a bank robbery team can still be prosecuted

14   even though he has not “by force and violence . . . take[n] . . . from the person or

15   presence of another . . . any property . . . belonging to . . . any bank.” 18 U.S.C.

16   § 2113(a). As the common law has long recognized, persons who intentionally

17   direct or facilitate the crimes physically executed by others must be held

18   accountable for their actions. This recognition was effectuated by developing the
                                               18
 1   doctrines of conspiracy and complicity, principles that are now codified in

 2   statutes. Under 18 U.S.C. § 2(a), a person who does not personally commit the

 3   acts constituting an offense is liable as a principal if he or she “aids, abets,

 4   counsels, commands, induces or produces” the commission of those acts by

 5   another. In addition, 18 U.S.C. § 371 punishes anyone who “conspire[s]” with

 6   another to commit the offense. Thus, by the plain language of the general statutes

 7   regarding conspiracy and accessorial liability—which nothing in the language of

 8   the FCPA purports to overrule or limit—if Hoskins did what the indictment

 9   charges, he would appear to be guilty of conspiracy to violate the FCPA and (as

10   an accomplice) of substantive violations of that statute.

11         Conspiracy and complicity statutes do not cease to apply simply because a

12   statute specifies particular classes of people who can violate the law. It is well

13   established in federal criminal law that “[a] person . . . may be liable for

14   conspiracy even though he was incapable of committing the substantive

15   offense.” Salinas v. United States, 

, 64 (1998). That principle was already

16   deeply ingrained when the Supreme Court unanimously ruled in 1915 that

17   persons not themselves bankrupt could be guilty of conspiring with someone

18   who had declared bankruptcy to hide assets of the bankrupt’s estate from the
                                                19
 1   bankruptcy trustee, even if a non-bankrupt party could not be convicted of the

 2   principal offense. United States v. Rabinowich, 

, 86 (1915). With respect

 3   to complicity, the same principal was so clearly entrenched as a matter of the

 4   common law of crimes that the Supreme Court saw no need to cite a particular

 5   precedent when it unanimously recognized in 1833 that someone who

 6   “procure[d], advise[d] and assist[ed]” a postmaster to remove from the mail and

 7   destroy a letter was guilty of violating, as an accomplice, a statute prohibiting

 8   postal employees from taking mail entrusted to them for delivery. United States v.

 9   Mills, 

, 141 (1833).

10         Thus the firm baseline rule with respect to both conspiracy and complicity

11   is that where the crime is so defined that only certain categories of persons, such

12   as employees of a particular sort of entity, may commit the crime through their

13   own acts, persons not within those categories can be guilty of conspiring to

14   commit the crime or of the substantive crime itself as an accomplice. 4




     4See American Law Institute, Model Penal Code and Commentaries, § 2.06 at 323
     (1985) (“Many crimes are designed to control the conduct of persons who occupy
     special positions, and thus can only be committed by those who actually occupy
     the designated position. It is universally held, on the other hand, that one who
     assists an occupant of the designated position in the commission of the offense
                                               20
 1   Longstanding principle and precedent thus reinforces what the plain language of

 2   the conspiracy and aiding and abetting statutes command.

 3             B. The Affirmative-Legislative-Policy Exception

 4         There is a narrowly circumscribed exception to this common-law principle.

 5   In certain cases it is clear from the structure of a legislative scheme that the

 6   lawmaker must have intended that accomplice liability not extend to certain

 7   persons whose conduct might otherwise fall within the general common-law or

 8   statutory definition of complicity. A classic illustration is statutory rape, which

 9   makes it a crime to have sexual relations with a person who is under a statutorily

10   defined age of consent. Applying the literal definitions of accomplice liability, a

11   youthful participant who voluntarily consents to the act would be guilty of rape

12   as well, because he or she intentionally aided or solicited the commission of the

13   criminal act. But the legislature, in criminalizing the conduct of the adult

14   participant and not that of the juvenile, obviously conceptualized the under-age

15   party as the victim of the crime, and not a co-participant. Despite the common-

16   law recognition of conspiracy and accomplice liability, and of the general



     can nevertheless be held as an accomplice. Common sense requires this result in
     the normal case.”).
                                            21
 1   principle that one could be guilty as a conspirator or accomplice even if the

 2   statute were defined in such a way that one was not capable of committing it as a

 3   principal, the common-law courts had no difficulty in recognizing an exception

 4   in those circumstances. See, e.g., Regina v. Tyrell, [1894] 1 Q.B. 710.

 5         Here the government concedes that the common-law principle of

 6   conspiracy liability admits of exceptions but argues that the FCPA falls outside

 7   those exceptions. Hoskins, by contrast, contends that the FCPA demonstrates “an

 8   affirmative Congressional intent to exclude certain persons from liability” under

 9   the statute. Appellee’s Br. at 20 (emphasis omitted). The parties’ dispute focuses

10   on two cases, Gebardi v. United States, 

(1932), and United States v.

11   Amen, 

(2d Cir. 1987), and it is thus profitable to consider both in

12   some detail.

13         1. Gebardi

14         In Gebardi, the Supreme Court considered a conviction under the Mann

15   Act, a statute that imposes a penalty upon

16         any person who shall knowingly transport or cause to be
17         transported, or aid or assist in obtaining transportation for, or in
18         transporting, in interstate or foreign commerce any woman or girl
19         for the purpose of prostitution or debauchery, or for any other
20         immoral purpose.
                                                22
 

(quoting 18 U.S.C. § 398 (1932)). The Mann Act criminalizes such

 2   transportation “with or without [the woman’s] consent.” 

 3   convicted both a man and woman for conspiracy to violate the Mann Act, on the

 4   theory that the woman conspired to transport a person—herself—merely by

 5   consenting to the man’s transportation of her.

 6         The Supreme Court reversed the convictions. The Court first noted that the

 7   Mann Act plainly covered cases where “the woman consents to her own

 8   transportation,” rather than just cases where her transportation was forced,

 9   “[y]et it does not specifically impose any penalty upon her, although it deals in

10   detail with the person by whom she is transported.” 

Because it would

11   be obvious that women would participate in many violations of the statute, but

12   the statute discussed no punishment for the women, the Court concluded that

13   Congress intended for the women not to be liable for at least some class of

14   violations of the Act. In particular, the Court determined it could not “infer that

15   the mere acquiescence of the woman transported was intended to be condemned

16   by the general language punishing those who aid and assist the transporter.” 

penalties of the statute are too clearly directed against the acts of the



                                              23
 1   transporter” to support the view that Congress intended the woman always to be

 2   liable. 

decided that Congress intended to leave the woman unpunished

 4   when she merely acquiesced in her own illegal transportation, the Court next

 5   considered whether she could be convicted of conspiring to violate the statute in

 6   such circumstances. 

The Court concluded that she could not. The

 7   Court emphasized, again, that “Congress set out in the Mann Act to deal with

 8   cases which frequently, if not normally, involve consent and agreement on the

 9   part of the woman to the forbidden transportation,” but that “this

10   acquiescence . . . was not made a crime under the Mann Act itself.” 

11   Consequently, the Court “perceive[d] in the failure of the Mann Act to condemn

12   the woman’s participation in those transportations which are effected with her

13   mere consent, evidence of an affirmative legislative policy to leave her

14   acquiescence unpunished.” 

The Court explained that it was

15          a necessary implication of that policy that when the Mann Act and
16          the conspiracy statute came to be construed together, as they
17          necessarily would be, the same participation which the former
18          contemplates as an inseparable incident of all cases in which the
19          woman is a voluntary agent at all, but does not punish, was not
20          automatically to be made punishable under the latter. It would
21          contravene that policy to hold that the very passage of the Mann Act
                                             24
 1          effected a withdrawal by the conspiracy statute of that immunity
 2          which the Mann Act itself confers.

 3   

Because the defendant in Gebardi had merely consented to her

 4   transportation, the Court ruled that her conviction for conspiracy could not

 5   stand; and because she had not conspired to violate the Mann Act, her

 6   companion had no one with whom to conspire. 

their convictions for

 7   conspiracy were reversed. 

determining that the woman in Gebardi was not liable as a conspirator

 9   because of Congress’s “affirmative legislative policy” to leave her unpunished,

10   

the Gebardi Court distinguished its reasoning from an older common-

11   law limitation on conspiracy liability—a rule widely known as Wharton’s Rule.

12   See 

see also Iannelli v. United States, 

, 773-76 (1975)

13   (discussing Wharton’s Rule and identifying Gebardi as a case that had previously

14   discussed it). Wharton’s Rule states that “[a]n agreement by two persons to

15   commit a particular crime cannot be prosecuted as a conspiracy when the crime

16   is of such a nature as to necessarily require the participation of two persons for

17   its commission,” such as dueling. 

n.5 (quoting 

  Anderson, Wharton’s Criminal Law and Procedure § 89, at 191 (1957)).


                                                 25
 1         The Court in Gebardi alluded to Wharton’s Rule. See 

  122. But the Court stated that Wharton’s Rule did not apply, because the Rule

 3   requires voluntary consent while “criminal transportation under the Mann Act

 4   may be effected without the woman’s consent as in cases of intimidation or

 5   force.” 

Court “d[id] not rest [the] decision upon [Wharton’s

 6   Rule], nor upon the related one that the attempt is to prosecute as conspiracy acts

 7   identical with the substantive offense.” 

Instead, the Court explicitly

 8   situated its ruling “upon the ground that we perceive in the failure of the Mann

 9   Act to condemn the woman’s participation in those transportations which are

10   effected with her mere consent, evidence of an affirmative legislative policy to

11   leave her acquiescence unpunished.” 

12         2. Amen

13         We applied the reasoning of Gebardi in United States v. Amen, 

14   (2d Cir. 1987). In Amen, the Court considered the “continuing criminal

15   enterprise” statute, 21 U.S.C. § 848, a provision “designed to reach the ‘top brass’

16   in the drug rings,” Garrett v. United States, 

, 781 (1985), or, to put it

17   differently, the “kingpin” in an enterprise. 

. A defendant

18   was convicted on the theory that he conspired with, and aided and abetted, an
                                                26
 1   enterprise’s “kingpin,” even though the defendant himself was not the

 2   “kingpin.” 

government conceded that the statute did not apply to an enterprise’s

 4   employees. 

It nevertheless attempted to distinguish between “mere

 5   employees and those who otherwise ‘help’ the kingpin,” and to argue that “non-

 6   employees who knowingly provide direct assistance to the head of the

 7   organization in supervising and operating the criminal enterprise can be . . .

 8   punished” for violating the “kingpin” statute under conspiracy and aiding-and-

 9   abetting theories. 

10         We explained, however, that the government’s theory “lack[ed] support in

11   legislative history” and “seem[ed] totally unworkable” because many employees

12   would provide greater assistance to the “kingpin” than non-employee third

13   parties, and that it made little sense to extend the government’s theory to one

14   group if it concededly could not reach the other. 

This application of

15   complicity and conspiracy would disrupt the carefully defined statutory

16   gradation of offenses; the low-level henchman would find himself subject to the

17   more severe penalties applicable to the “kingpin.” Because the Court determined



                                              27
 1   that Congress did not intend for the “kingpin” statute to apply to the class of

 2   individuals involved in the case, the defendant’s conviction was overturned. 

Identifying an Affirmative Legislative Policy

 4         Accepting Gebardi’s teaching that conspiracy and complicity liability will

 5   not lie when Congress demonstrates an affirmative legislative policy to leave

 6   some type of participant in a criminal transaction 

,

 7   the question becomes how to identify such a policy. As the common-law

 8   principle outlined above indicates, we cannot identify such a policy whenever a

 9   statute focuses on certain categories of persons at the exclusion of others. Gebardi

10   confirms this, emphasizing that its reasoning was “concerned with something

11   more than an agreement between two persons for one of them to commit an

12   offense which the other cannot commit.” 

In Gebardi that “something

13   more” was a recognition that because a woman’s participation was “an

14   inseparable incident of all cases in which the woman is a voluntary agent”

15   capable of entering into a conspiracy, Congress’s silence as to the women’s

16   liability was a conferral of immunity. 

Similarly, in Amen the Court

17   saw that the continuing criminal enterprise provision “was designed to reach the

18   top brass in the drug rings, not the lieutenants and foot soldiers” and broadening
                                              28
 1   the scope of liability with the conspiracy statute would subvert that purpose. 

(brackets and internal quotation marks omitted). In both instances the

 3   courts looked to the text of the statute and the purpose that Congress was trying

 4   to achieve, thereby honoring their “over-arching obligation to give effect to

 5   congressional intent” when interpreting statutes. United States v. Bonanno

 6   Organized Crime Family of La Cosa Nostra, 

, 21 (2d Cir. 1989). In keeping

 7   with traditional principles of statutory interpretation, as well as the analysis

 8   employed in Gebardi and its progeny, an affirmative legislative policy can be

 9   discerned by looking to the statute’s text, structure, and legislative history. 5

10         4. Government’s Arguments for a Narrower Principle

11         The government argues for a much narrower reading of Gebardi that

12   would effectively circumscribe the ability of the courts to ascertain congressional



     5“Logic and precedent dictate that the starting point in every case involving
     construction of a statute is the language itself.” Greyhound Corp. v. Mt. Hood
     Stages, Inc., 

, 330 (1978) (brackets and internal quotation marks
     omitted). “In evaluating ambiguity we look to the statutory scheme as a whole
     and place the particular provision within the context of that statute.” Raila v.
     United States, 

, 120 (2d Cir. 2004). “As a general matter, we may
     consider reliable legislative history where, as here, the statute is susceptible to
     divergent understandings and, equally important, where there exists
     authoritative legislative history that assists in discerning what Congress actually
     meant.” United States v. Gayle, 

, 94 (2d Cir. 2003).
                                                29
 1   intent in enacting criminal statutes. The government argues that Gebardi

 2   forecloses liability for conspiracy or complicity only when (1) “the defendant’s

 3   consent or acquiescence is inherent in the [substantive] offense,” or (2) “the

 4   defendant’s participation in the crime is frequently, if not normally a feature of

 5   the [substantive] criminal conduct.” Appellant’s Opening Br. at 24 (internal

 6   quotation marks omitted).

 7         A number of problems arise with either of these narrow readings of

 8   Gebardi. The government’s first reading of Gebardi is foreclosed because, at least

 9   in the conspiracy context, it is the same as Wharton’s Rule. As noted, where a

10   substantive offense requires persons to agree in order to commit it, Wharton’s

11   Rule disallows liability for conspiracy based on the same agreement required for

12   the substantive crime. See 

. Here, the government suggests

13   that we should read the Gebardi principle to mean the same thing: that liability

14   for conspiracy is barred when “the defendant’s consent or acquiescence is

15   inherent in the [substantive] offense.” Appellant’s Opening Br. at 24 (internal

16   quotation marks omitted). The opinion in Gebardi explicitly stated that its




                                              30
 1   reasoning was not based on Wharton’s Rule; thus that cannot be the basis for the

 2   exception. 

. 6

 3         The government’s argument that the exception is limited to situations

 4   where the defendant’s conduct is inherent in the substantive offense is also

 5   inconsistent with Amen. Our holding in Amen, which considered an individual

 6   who was not an employee of the criminal enterprise, did not turn on the fact that

 7   the defendant was essential to the existence of the criminal transaction under

 8   consideration. 

. Although a “criminal enterprise” with a

 9   “kingpin” must have employees, and such employees are thus essential to the

10   statute’s application, the enterprise need not work with non-employee third

11   parties. Amen held that the “kingpin” statute did not apply to third parties, and




     6Wharton’s Rule applies only to conspiracy, which means that there could be
     daylight between it and the government’s proposed rule that neither conspiracy
     nor complicity liability will lie where “the defendant’s consent or acquiescence is
     inherent in the [substantive] offense.” Appellant’s Opening Br. at 24 (internal
     quotation marks omitted). But within Gebardi itself, the government’s proposed
     rule would have operated identically to Wharton’s Rule, since Gebardi dealt only
     with a conspiracy charge. And since the Supreme Court said in Gebardi that it
     was not relying on Wharton’s Rule, the government’s rule cannot be defended as
     the rule the Supreme Court meant to adopt.
                                               31
 1   did so based on the intentions of Congress rather than because third parties were

 2   required for a criminal enterprise to exist. See 

 3         Second, we do not share the government’s view that Gebardi asks whether

 4   a certain type of defendant’s conduct is “frequently, if not normally” involved in

 5   an offense. 

. With respect to the statute giving rise to

 6   Gebardi—the Mann Act—there was no question that a woman’s participation in

 7   the crime was “frequently, if not normally” a feature of a violation. Indeed, a

 8   woman’s participation, either willing or unwilling, was required in every

 9   violation. But the Court did not merely ask whether her involvement was

10   “frequently, if not normally” a feature of a violation; instead, the Court discerned

11   the legislative policy of the Mann Act, and provided immunity only to the extent

12   it comported with the Act’s policy. 

13         Indeed, in United States v. Holte, 

(1915), a predecessor case to

14   Gebardi, the Court explicitly held that a woman could be found guilty for

15   conspiring to violate the Mann Act. The Court described a hypothetical case

16   where immunity would not be appropriate:

17         Suppose, for instance, that a professional prostitute, as well able to
18         look out for herself as was the man, should suggest and carry out a
19         journey within the [Mann Act] in the hope of black-mailing the man,
                                                32
 1         and should buy the railroad tickets, or should pay the fare from
 2         Jersey City to New York,-she would be within the letter of the
 3         [Mann Act], and we see no reason why the act should not be held to
 4         apply. We see equally little reason for not treating the preliminary
 5         agreement as a conspiracy that the law can reach, if we abandon the
 6         illusion that the woman always is the victim.

 

. The Court’s analysis in Holte, much like in Gebardi, did not merely

 8   ask whether a woman would “frequently if not normally” be present for

 9   violations of the Mann Act. Instead, the Court determined Congress’s policy in

10   enacting the statute, and limited liability consistent with that policy. To be sure,

11   the fact that a woman was invariably part of a violation of the Act was relevant

12   in discerning congressional policy. But the rule the Holte Court adopted was

13   much more nuanced than could be justified by simply observing those offenses

14   for which women would be present: by definition, a woman’s presence was

15   required for every violation of the Act.

16         Finally, the government relies on Ocasio v. United States, 

17   (2016), a recent decision that it believes to have drawn narrowly the exception

18   exemplified by Gebardi. The opinion in Ocasio considered an incident of bribery

19   charged under the Hobbs Act, and a charge of conspiracy to violate the Hobbs

20   Act by paying the same 

. Although the language of the


                                                33
 1   Hobbs Act prohibits “extortion” committed by “the obtaining of property from

 2   another, with his consent . . . under color of official right,” 18 U.S.C. § 1951(b)(2),

 3   the Supreme Court has held that this tortured language is best understood as the

 4   “rough equivalent of what we would now describe as ‘taking a bribe,’” Ocasio,

 

(quoting Evans v. United States, 

, 260 (1992)). In

 6   other words, the Hobbs Act’s text speaks as though a bribe-payer is being

 7   “extorted,” when, in reality, the bribe may be a consensual one paid to secure

 8   some advantage.

 9         The defendant in Ocasio contended, using the language of the Hobbs Act,

10   that he could not be convicted of conspiracy. He noted that the Hobbs Act

11   criminalized “obtaining of property from another,” 18 U.S.C. § 1951(b)(2)

12   (emphasis added). He then contended that a conspiracy charge was not

13   appropriate, because “the conspirators,” who were the officials taking the bribe

14   and the persons paying it, “had not agreed to obtain money from [“another”—

15   that is, from] a person who was not a member of the conspiracy.” Ocasio, 136 S.

16   Ct. at 1429. The Court rejected this argument, explaining that it did not matter

17   that the defendants who paid the bribes “did not have the objective of obtaining

18   money ‘from another’ because the money in question was their own.” 

                                               34
 1   The Court simply reasoned that it was sufficient for the defendants to conspire

 2   with others who would take money “from another,” even if that “[]other” person

 3   happened to be the conspirator himself. 

 4         The opinion in Ocasio emphasized that the crime in question, Hobbs Act

 5   extortion, bears a meaning not readily discernible from its text. Because, as

 6   noted, the statute essentially criminalizes “taking a bribe,” the Court was

 7   unwilling to indulge the defendant’s argument that the text indicated an

 8   affirmative legislative policy to leave the “extorted” party unpunished, or a

 9   desire to punish only the party taking property “from 

  1435-36.

11         Although Ocasio arose in a setting where a statute’s language arguably

12   suggested that certain persons are spared from liability, the unique features of

13   Hobbs Act extortion limit Ocasio’s helpfulness to the government. Because the

14   Supreme Court did not agree that the Hobbs Act manifested the “something

15   more” present in Gebardi, namely any intention to limit liability for the payer of a

16   bribe, the Court rejected the argument that conspiracy liability should be

17   circumscribed based on any such limitation. 

(“The subtext of

18   [defendant’s] arguments is that it seems unnatural to prosecute bribery on the
                                              35
 1   basis of a statute prohibiting ‘extortion,’ but this Court held in Evans that Hobbs

 2   Act extortion ‘under color of official right’ includes the rough equivalent of what

 3   we would now describe as ‘taking a bribe.’ . . . [W]e have no occasion to

 4   [overrule Evans.]” (internal quotation marks and citations omitted)).

 5   Consequently, the case does not demonstrate a narrowing of the affirmative-

 6   legislative-policy exception, but simply a situation where there was no

 7   affirmative legislative policy to leave the bribe payers unpunished. Moreover,

 8   Ocasio’s independent ruling that incapacity to commit a substantive offense does

 9   not, without more, preclude conspiracy or complicity charges, is merely a

10   reaffirmation of the common-law principle addressed above, not an abdication of

11   the affirmative-legislative-policy exception.

12      C. The Affirmative Legislative Policy Regarding the FCPA’s Coverage
13
14         Applying the teachings of Gebardi and Amen to the FCPA, we find the

15   “something more” that evinces an affirmative legislative policy to leave the

16   category of defendants omitted from the statutory framework unpunished. In

17   particular, the carefully tailored text of the statute, read against the backdrop of a

18   well-established principle that U.S. law does not apply extraterritorially without

19   express congressional authorization and a legislative history reflecting that
                                              36
 1   Congress drew lines in the FCPA out of specific concern about the scope of

 2   extraterritorial application of the statute, persuades us that Congress did not

 3   intend for persons outside of the statute’s carefully delimited categories to be

 4   subject to conspiracy or complicity liability. Our conclusion is consistent with the

 5   reasoning of other courts that have addressed this question. See United States v.

 6   Castle, 

(5th Cir. 1991); United States v. Bodmer, 

 7   (S.D.N.Y. 2004).

 8         1. Text of the FCPA

 9         We begin with the text of the statute. Like the Mann Act, which “[did] not

10   specifically impose any penalty upon” a woman for assisting in her own

11   transportation across state lines, “although it deal[t] in detail with” other

12   persons, 

, the FCPA contains no provision assigning

13   liability to persons in the defendant’s position—nonresident foreign nationals,

14   acting outside American territory, who lack an agency relationship with a U.S.

15   person, and who are not officers, directors, employees, or stockholders of

16   American companies. See 15 U.S.C. §§ 78dd-1; 78dd-2; 78dd-3.

17         Moreover, in Gebardi, the statute under consideration was less clear as to

18   Congress’s intent to exclude the defendant from liability, compared to the
                                              37
 1   FCPA’s utter silence regarding the class of defendants involved in this case. As

 2   noted, the Mann Act placed a penalty upon “any person who shall knowingly

 3   transport or cause to be transported, or aid or assist in obtaining transportation

 4   for . . . any woman or girl for . . . any . . . immoral purpose.” 

The

 5   Supreme Court explained that, for a woman to be liable under the Mann Act, her

 6   role must “be more active than mere agreement on her part to the transportation

 7   and its immoral purpose.” 

But the Court stated in Gebardi, much as it

 8   did in Holte, that the Mann Act would cover the woman to the extent she were to

 9   “‘aid or assist’ some one else in transporting or in procuring transportation” for

10   her. 

statute created at least some potential for liability where a

11   woman did more than exhibiting “mere agreement . . . to the transportation.” 

the present case, by contrast, there is no text that creates any liability

13   whatsoever for the class of persons in question.

14         2. Structure of the FCPA

15         A second piece of evidence—the structure of the FCPA—confirms that

16   Congress’s omission of the class of persons under discussion was not accidental,

17   but instead was a limitation created with surgical precision to limit its

18   jurisdictional reach. The statute includes specific provisions covering every other
                                                38
 1   possible combination of nationality, location, and agency relation, leaving

 2   excluded only nonresident foreign nationals outside American territory without

 3   an agency relationship with a U.S. person, and who are not officers, directors,

 4   employees, or stockholders of American companies.

 5         The FCPA explicitly lays out several different categories of persons over

 6   whom the government may exercise jurisdiction. First, the statute prohibits a

 7   company issuing securities regulated by federal law (an “issuer”) from using

 8   interstate commerce in connection with certain types of corrupt payments to

 9   foreign officials. 15 U.S.C. § 78dd–1(a). The same prohibitions apply to any

10   “domestic concern.” 15 U.S.C. § 78dd–2(a). “Domestic concern” is a broad term

11   that covers “any individual who is a citizen, national, or resident of the United

12   States,” 15 U.S.C. § 78dd–2(h)(1)(A), wherever such a person happens to be in the

13   world. It also covers most businesses—including partnerships, sole

14   proprietorships, and unincorporated organizations—that are organized under

15   state or federal law or have principal places of business in the United States. 15

16   U.S.C. § 78dd–2(h)(1)(B).

17         Importantly, the prohibitions on issuers and domestic concerns also apply

18   to “any officer, director, employee, or agent of” the entity, “or any stockholder
                                              39
 1   thereof acting on behalf of” the entity. 15 U.S.C. §§ 78dd–1(a), 78dd–2(a). The

 2   statute’s prohibitions thus apply not only (for example) to partnerships

 3   organized under state law, but also to their executives, janitors, and travel

 4   agents. And, although a person must be a citizen, national, or resident of the

 5   United States to be charged as a domestic concern, no similar requirement limits

 6   the liability of officers, employees, or agents of domestic concerns and issuers.

 7         Second, the statute prohibits “any person other than an issuer . . . or a

 8   domestic concern” from using interstate commerce in furtherance of corrupt

 9   payments to foreign officials, but only while the person is “in the territory of the

10   United States.” 15 U.S.C. § 78dd-3(a). A “person” is “any natural person other

11   than a national of the United States,” as well as any business organized under

12   foreign law. 15 U.S.C. § 78dd-3(f)(1).

13         In sum, these provisions provide jurisdiction over the following persons,

14   in the following scenarios:

15         (1) American citizens, nationals, and residents, regardless of whether they
16             violate the FCPA domestically or abroad;
17
18         (2) most American companies, regardless of whether they violate the
19             FCPA domestically or abroad;
20



                                              40
 1         (3) agents, employees, officers, directors, and shareholders of most
 2             American companies, when they act on the company’s behalf,
 3             regardless of whether they violate the FCPA domestically or abroad;
 4
 5         (4) foreign persons (including foreign nationals and most foreign
 6             companies) not within any of the aforementioned categories who
 7             violate the FCPA while present in the United States.

 8   The single, obvious omission is jurisdiction over a foreign national who acts

 9   outside the United States, but not on behalf of an American person or company

10   as an officer, director, employee, agent, or stockholder.

11         3. Legislative History

12         The question thus becomes whether there is “something more,” a policy

13   basis for Congress to exclude Hoskins’s category of defendants from criminal

14   liability—something akin to the Mann Act’s decision not to punish the woman

15   who is frequently, if not normally involved in the offense or 21 U.S.C. § 848’s

16   gradation of punishment based on leadership in a criminal enterprise. We think

17   there is. “It is a basic premise of our legal system that, in general, United States

18   law governs domestically but does not rule the world.” RJR Nabisco, Inc. v.

19   European Cmty., 

, 2100 (2016) (internal quotation marks omitted).

20   Courts will therefore not apply a U.S. law extraterritorially unless “the

21   affirmative intention of the Congress [is] clearly expressed.” E.E.O.C. v. Arabian

                                               41
 1   Am. Oil Co., 

, 248 (1991). This principle stems from the risk of

 2   “unintended clashes between our laws and those of other nations which could

 3   result in international discord.” 

history of the FCPA makes it

 4   clear that Congress was attuned to these risks and carefully delimited the statute

 5   accordingly.

 6                  a. The Foreign Corrupt Practices Act of 1977

 7         When President Carter took office in 1977, sponsors of the 1976 precursor

 8   to the FCPA exhorted the administration to take an active approach in promoting

 9   an anti-bribery statute comparable to the 1976 bill that passed the Senate but

10   failed to pass the House. See Mike Koehler, The Story of the Foreign Corrupt

11   Practices Act, 73 OHIO ST. L.J. 929, 996 (2012). The Carter Administration indicated

12   its support for such a statute, and, in particular, suggested that “specific criminal

13   penalties” for acts of bribery were the correct approach to solving the problem.

14   See Foreign Corrupt Practices and Domestic and Foreign Investment Disclosure:

15   Hearing on S. 305 Before the S. Comm. on Banking, Hous., & Urban Affairs, 95th

16   Cong. 67 (1977) (statement of W. Michael Blumenthal, Secretary of the Treasury).

17                        i. The Administration and the Senate Bill



                                              42
 1         Although it hoped to pass aggressive anti-bribery legislation, the

 2   Administration recognized that a statute focusing on criminalization, rather than

 3   disclosure, required a delicate touch where extraterritorial conduct and foreign

 4   nationals were concerned. The Secretary of the Treasury, W. Michael Blumenthal,

 5   noted as much at a hearing before the Senate Committee on Banking, Housing,

 6   and Urban Affairs on March 16, 1977:

 7         [T]he Administration recognizes that great care must be taken with
 8         an approach which makes certain types of extraterritorial conduct
 9         subject to our country’s criminal laws. Moreover, a law which
10         provides criminal penalties must describe the persons and acts
11         covered with a high degree of specificity in order to be enforceable,
12         to provide fair warning to American businessmen.

13   

Secretary Blumenthal emphasized, in particular, the Administration’s

14   concerns regarding the protection of foreign nationals:

15         There is a problem of extraterritoriality which needs to be carefully
16         addressed. There is also a question of insuring fairness and due
17         process, not only for American citizens but also for those foreign
18         citizens and foreign countries who may in some way become
19         involved and whose reputations become involved in particular
20         allegations. We have to deal with the question of how we can write
21         the bill in such a way that it includes protections in this regard.




                                             43
 1   

The Secretary’s requests, in other words, were for the Committee to

 2   enact a bill that clarified the extent of liability, and that provided protection for

 3   foreign persons.

 4            In the initial draft of the FCPA, individual liability for bribery was

 5   chargeable largely through the conspiracy and complicity statutes. In the initial

 6   draft, as in the current version of the FCPA, there were three categories of legal

 7   rules:

 8       first, obligations to create “books, records, and accounts, which accurately
 9        and fairly reflect the transactions” of the company, S. 305, 95th Cong., §
10        102(2)(A) (as introduced Jan. 18, 1977) (hereinafter “S. 305 as Introduced”),;
11
12       second, obligations to “devise and maintain an adequate system of internal
13        accounting controls sufficient to provide reasonable assurances” that
14        transactions are properly authorized and recorded, 

102(2)(B); and
15
16       third, provisions prohibiting the payment of bribes to foreign officials, 

§§ 103-104.

18   Individual liability was discussed for the first two classes of rules—the “books

19   and records” and “internal accounting controls” provisions. See S. 305 as

20   Introduced, § 102(3) (“It shall be unlawful for any person, directly or indirectly,

21   to falsify, or cause to be falsified, any book, record, account, or document . . . .”).

22   But the anti-bribery provision, spread over Sections 103 and 104, covered only


                                                 44
 1   bribery by an “issuer” or a “domestic concern.” Conspicuously absent was any

 2   provision creating liability for the employees of an “issuer,” which meant that

 3   there would be no liability under a substantive provision of the statute for an

 4   employee of a publicly-traded company who approved a bribe. See S. 305 as

 5   Introduced, § 103. Although the draft prohibited “domestic concerns, other than

 6   an issuer” from offering, paying, promising to pay, or “authoriz[ing] the

 7   payment of” bribes, see S. 305 as Introduced, §104(a), and the draft included

 8   among “domestic concerns” both “an individual who is a citizen or national of

 9   the United States,” as well as most American companies, see S. 305 as Introduced,

10   §104(c)(1), the provision did not clarify that an individual employee of a non-

11   issuer company would be liable for the company’s payment of bribes. The result

12   was draft legislation that clearly did not create direct individual liability for

13   employees of publicly-traded companies, and only arguably created it for

14   employees of other companies. As explained below, the Senate’s intention in this

15   draft was to create individual liability using the conspiracy and complicity

16   statutes rather than by enumerating particular individuals who could be liable

17   within the statute’s text.



                                               45
 1         On April 6, 1977, less than a month after Secretary Blumenthal’s testimony

 2   before a Senate committee, his concerns regarding individual liability under the

 3   nascent FCPA were specifically addressed in a markup session held by the same

 4   committee. During the session, the Committee on Banking, Housing and Urban

 5   Affairs discussed the version of S. 305 that had been introduced to the Senate. See

 6   Markup Session on S. 305, Corporate Bribery, S. Comm. on Banking, Hous. and

 7   Urban Affairs, 95th Cong. 1-2 (1977). The Committee adopted two amendments

 8   that significantly clarified the classes of persons liable under the statute, and did

 9   so by reducing the bill’s reliance on conspiracy and complicity theories:

10         Amendment number 3, on page 4, line 5 after the word “title” insert
11         the words “or any officer, director, employee or stockholder thereof
12         acting on behalf of such issuer.”

13         On page 6, line 1 after “1934” insert the words: “or any officer,
14         director, employee or stockholder thereof acting on behalf of such
15         domestic concern.”

16   

These amendments clarified that particular individuals would be liable

17   for certain violations of the statute. These amendments were explained in the

18   markup hearing as a change to the Senate’s earlier plan to cover individuals

19   using theories of complicity and conspiracy instead of defining specifically the

20   persons who could be liable under the statute:

                                              46
 1         [T]his amendment also reflects the Administration’s position in
 2         recommending that individuals be covered. Indeed, I believe that
 3         the committee last year intended to cover individuals; however, it
 4         wasn’t specifically stated. They were intended to be covered as
 5         aiders, abettors and conspirators and so on and so forth, and this
 6         makes clear that they are covered directly and also it makes it clear
 7         that they are covered in their capacity in acting on behalf of the
 8         company.

 9   

markup session provides powerful evidence of two points relevant to

11   this case. First, before the Carter Administration’s concerns and the markup

12   hearing detailed above, the Senate had planned to adopt a bill that largely

13   omitted references to individual liability, and that instead relied on theories of

14   conspiracy and complicity to tie individual action to corporate misdeeds. In

15   response to administration concerns—particularly concerns regarding the clarity

16   of liability and its application to foreign persons—the Senate rejected its prior

17   approach. Instead, it opted for a version of the bill that was not reliant on

18   conspiracy or complicity theories. Rather, it defined, with great precision, who

19   would be liable.

20                      ii. The House Bill and Final Legislation




                                              47
 1         In the House, Representative Bob Eckhardt initially proposed a bill, the

 2   Unlawful Corporate Payments Act of 1977, with broader coverage than the

 3   Senate’s initial legislation. See H.R. 3815, 95th Cong. (as introduced Feb. 22, 1977).

 4   The bill created liability not only for officers, directors, and employees of issuers

 5   and domestic concerns, 

2(a), 3(c)(1), but also for “agents” who

 6   “knowingly and willfully carried out” bribes, 

2(a), 3(c)(2). The sections

 7   covering individuals—including subsection (3)(c)(2), which covered “agents”

 8   who “carried out” bribes—appeared to apply regardless of nationality or

 9   location.

10         Several leading authorities, including Harvey L. Pitt, General Counsel of

11   the SEC, suggested to Representative Eckhardt and other Congressmen on the

12   Committee on Interstate and Foreign Commerce that these provisions went too

13   far. In a hearing discussing the bill, Mr. Pitt stated as follows:

14         At a minimum, I think the language of subsection (c)(2), applying to
15         any agent, might create some jurisdictional problems if the agent is
16         wholly situated overseas and has not been in this country. While I
17         think there are jurisdictional ties that could be asserted, the
18         problems you express in this case might be even worse in terms of
19         prosecution. But, I think you could so something along the lines you
20         are suggesting either by amending this subsection or by report
21         language that would clarify burdens of proof, obligations, and the


                                               48
 1         involvement of agents, to provide a fair opportunity for an agent to
 2         present his defense. That does seem to be a very serious concern.

 3   Unlawful Corporate Payments Act of 1977: Hearings Before the Subcomm. on Consumer

 4   Prot. and Fin. of the Comm. on Interstate and Foreign Commerce, 95th Cong. 232

 5   (1977) (statement of Harvey L. Pitt, General Counsel, Securities and Exchange

 6   Commission). Following these hearings, the Committee on Interstate and Foreign

 7   Commerce reported an amended bill to the House. The revised version allowed

 8   liability for agents and employees of issuers and domestic concerns only if the

 9   company for which they worked was also found to be liable—a change that

10   essentially increased the U.S. nexus required for an offense to be covered. 7 See H.

11   Rep. No. 95-831, at 13 (1977) (Conf. Rep.) (hereinafter “1977 Conference Report”).



     7It is noteworthy that the Committee Report accompanying the amended House
     bill in September of 1977 discussed the legislation’s purposes, and the need for
     the legislation, significantly more broadly than did the Senate’s comparable
     report:
             The payment of bribes to influence the acts or decisions of foreign
             officials, foreign political parties or candidates for foreign political
             office is unethical. It is counter to the moral expectations and values
             of the American public. But not only is it unethical, it is bad business
             as well. It erodes public confidence in the integrity of the free market
             system. It short-circuits the marketplace by directing business to
             those companies too inefficient to compete in terms of price, quality
             or service, or too lazy to engage in honest salesmanship, or too
             intent upon unloading marginal products. . . . Bribery of foreign
                                                   49
1         The final version of the FCPA, agreed to in conference, demonstrated a

2   compromise between the House and Senate versions. Like the Senate’s revised

3   bill—and the House’s original bill—it named particular categories of individuals

4   who would be liable under the FCPA rather than relying on the use of conspiracy

5   and complicity principles to create such liability. See Foreign Corrupt Practices

6   Act, Pub. L. No. 95-213, § 103(a), 91 Stat. 1494, 1495 (creating liability for bribery

7   committed by an “issuer” and “any officer, director, employee, or agent of such




          officials by some American companies casts a shadow on all U.S.
          companies. The exposure of such activity can damage a company’s
          image, lead to costly lawsuits, cause the cancellation of contracts,
          and result in the appropriation of valuable assets overseas.
          Corporate bribery is also unnecessary. . . . Corporate bribery also
          creates severe foreign policy problems for the United States. The
          revelation of improper payments invariably tends to embarrass
          friendly governments, lower the esteem for the United States among
          the citizens of foreign nations, and lend credence to the suspicions
          sown by foreign opponents of the United States that American
          enterprises exert a corrupting influence on the political processes of
          their nations. . . . Finally, a strong antibribery statute would actually
          help U.S. corporations resist corrupt demands.

    H.R. Rep. 95-640, at 4-5 (1977). This strong language underlines what is
    otherwise clear throughout the legislative history: that the House was concerned
    chiefly with questions of morality and public propriety—and public
    perception—whereas the Senate appeared more concerned with the SEC’s ability
    to obtain accurate disclosures and to police corporate filings.
                                              50
 1   issuer or any stockholder thereof acting on behalf of such issuer”); 

104(a),

 2   91 Stat. at 1496 (creating liability for bribery by a “domestic concern, other than

 3   an issuer,” and for “any officer, director, employee, or agent of such domestic

 4   concern or any stockholder thereof acting on behalf of such domestic concern”).

 5   It did allow liability for agents, but restricted the liability to an agent who was “a

 6   United States citizen, national, or resident or is otherwise subject to the

 7   jurisdiction of the United States,” 8 and also required a finding that the employer

 8   had been liable. 

103(a), 91 Stat. at 1496; 

104(b)(3)(a), 91 Stat. at 1497.

 9   The bill also rejected liability for foreign affiliates of American companies.

10          The Conference Report emphasized that the statute drew deliberate lines

11   regarding the liability of foreign persons, both corporate and natural:

12          [T]he conferees recognized the inherent jurisdictional, enforcement,
13          and diplomatic difficulties raised by the inclusion of foreign
14          subsidiaries of U.S. companies in the direct prohibitions of the bill.
15          However, the conferees intend to make clear that any issuer or
16          domestic concern which engages in bribery of foreign officials
17          indirectly through any other person or entity would itself be liable
18          under the bill. The conferees recognized that such jurisdictional

     8 In United States v. Bodmer, 

, 188 (S.D.N.Y. 2004), the district
     court ruled that the phrase “otherwise subject to the jurisdiction of the United
     States” did not expand the persons subject to liability under this section, because
     the phrase is superfluous. In any case, the government does not here suggest that
     it creates liability over foreign nationals.
                                                51
 1          enforcement, and diplomatic difficulties may not be present in the
 2          case of individuals who are U.S. citizens, nationals, or residents.
 3          Therefore, individuals other than those specifically covered by the
 4          bill (e.g., officers, directors, employees, agents, or stockholders acting
 5          on behalf of an issuer or domestic concern) will be liable when they
 6          act in relation to the affairs of any foreign subsidiary of an issuer or
 7          domestic concern if they are citizens, nationals, or residents of the
 8          United States. In addition, the conferees determined that foreign
 9          nationals or residents otherwise under the jurisdiction of the United
10          States would be covered by the bill in circumstances where an issuer
11          or domestic concern engaged in conduct proscribed by the bill.

12   1977 Conference Report at 14. This discussion, much like the discussion in the

13   earlier hearings on the Senate’s 1976 legislation, largely resolves the problem of

14   liability against foreign persons by noting that an American company will be

15   liable if it acts through unreachable foreign affiliates. See 

“any

16   issuer or domestic concern which engages in bribery of foreign officials indirectly

17   through any other person or entity would itself be liable”). Its mention of

18   situations where “foreign nationals or residents otherwise under the jurisdiction

19   of the United States” would be liable because “an issuer or domestic concern

20   engaged in conduct proscribed by the bill” clearly refers to the statute’s liability

21   for agents, which permits jurisdiction over foreign nationals. 

22   Report made no mention of conspiracy or aiding-and-abetting theories of

23   liability.

                                               52
 1                b. The 1998 Revisions 9

 2         In 1998, Congress amended the FCPA. The Committee Report from the

 3   Senate Committee on Banking, Housing, and Urban Affairs noted that “[s]ince

 4   the passage of the FCPA, American businesses have operated at a disadvantage

 5   relative to foreign competitors who have continued to pay bribes without fear of

 6   penalty,” because their countries’ laws did not include comparable prohibitions

 7   on bribery. S. Rep. No. 105-277, at 2 (1998) (hereinafter “1998 Senate Report”). In

 8   response to this problem, “[i]n 1988, Congress directed the Executive Branch

 9   actively to seek to level the playing field by encouraging . . . trading partners to

10   enact legislation similar to the FCPA.” 

eventually culminated in

11   the Organization for Economic Cooperation and Development Convention on

12   Combating Bribery of Foreign Public Officials in International Business

13   Transactions (the ‘OECD Convention’),” which asked signatory nations to enact

14   anti-bribery laws containing certain minimum requirements. 

Congress’s View of the Amendments




     9Neither party relies significantly on changes to the statute that occurred in 1988,
     so the Court need not analyze that set of amendments.
                                              53
 1         As the Committee Report explained, the 1998 statute aimed to “amend[]

 2   the FCPA to conform it to the requirements of and to implement the OECD

 3   Convention.” 

served five major purposes, although only

 4   three are pertinent here:

 5         [First], the OECD Convention calls on parties to cover “any person”;
 6         the [1977] FCPA cover[ed] only issuers with securities registered
 7         under the 1934 Securities Exchange Act and “domestic concerns.”
 8         The Act, therefore, expands the FCPA’s coverage to include all
 9         foreign persons who commit an act in furtherance of a foreign bribe
10         while in the United States. . . .

11         [Additionally], the OECD Convention calls on parties to assert
12         nationality jurisdiction when consistent with national legal and
13         constitutional principles. Accordingly, the Act amends the FCPA to
14         provide for jurisdiction over the acts of U.S. businesses and
15         nationals in furtherance of unlawful payments that take place
16         wholly outside the United States. This exercise of jurisdiction over
17         U.S. businesses and nationals for unlawful conduct abroad is
18         consistent with U.S. legal and constitutional principles . . . .

19         [F]inally, the Act amends the FCPA to eliminate the current
20         disparity in penalties applicable to U.S. nationals and foreign
21         nationals employed by or acting as agents of U.S. companies. In the
22         [1977] statute, foreign nationals employed by or acting as agents of
23         U.S. companies [were] subject only to civil penalties. The Act
24         eliminates this restriction and subjects all employees or agents of
25         U.S. businesses to both civil and criminal penalties.

26   

The relevant changes to the statute, in short, were liability for foreign

27   persons who committed acts within the United States, assertion of jurisdiction


                                               54
 1   over American businesses and nationals bribing persons wholly outside the

 2   United States, and creation of criminal, rather than just civil, penalties for foreign

 3   nationals who are employees or agents of American companies. Clearly, none of

 4   these goals have an impact on the question at issue in this case—whether a

 5   nonresident foreign national, acting entirely outside the United States, and who

 6   is not an employee or agent of an American company, may be liable based on a

 7   conspiracy or complicity theory.

 8         Moreover, the Committee Report took great pains to emphasize that the

 9   foreign nationals covered under the statute fit within three categories: (1) those

10   who acted on American soil, (2) those who were officers, directors, employees, or

11   shareholders of U.S. companies, and (3) those who were agents of U.S.

12   companies. The following examples illustrate the Report’s care in making the

13   matter clear:

14         Section 2(d) implements the OECD Convention by amending § 32(c)
15         of the Securities Exchange Act of 1934 to eliminate the current
16         disparity in treatment between U.S. nationals that are employees or
17         agents of issuers and foreign nationals that are employees or agents
18         of issuers. Presently, foreign nationals who are employees or agents (as
19         opposed to officers or directors) are subject only to civil sanctions. . . .

20         [I]t is expected that the established principles of liability, including
21         principles of vicarious liability, that apply under the current version

                                                55
 1         of the FCPA shall apply to the liability of U.S. businesses for acts
 2         taken on their behalf by their officers, directors, employees, agents, or
 3         stockholders outside the United States, regardless of the nationality of the
 4         officer, director, employee, agent, or stockholder.

 5         The new offense . . . provid[es] for criminal jurisdiction in this
 6         country over bribery by foreign nationals of foreign officials when the
 7         foreign national takes some act in furtherance of the bribery within the
 8         territory of the United States.

 9   

(emphases added). Each mention of foreign nationals is carefully

10   followed by clarifications—often highly repetitive ones—noting that foreign

11   nationals are liable only because they fall within one of the three categories.

12   There is no mention, in any of these seemingly exhaustive descriptions of how

13   foreign nationals are covered under the statute, of liability based on conspiring

14   or aiding and abetting an offense even though the foreign national is not an

15   agent, employee, officer, director, or shareholder of the American company, and

16   even though the foreign national is operating entirely outside the territory of the

17   United States.

18                      ii. Language of the OECD Convention

19         The government’s argument—that Congress must have intended to cover

20   foreign nationals acting abroad who are not employees or agents of an American

21   company—focuses heavily on the OECD Convention with which Congress

                                               56
 1   intended to make American law comply. The government first contends that the

 2   OECD Convention shows that the United States agreed to “take such measures

 3   as may be necessary to establish that it is a criminal offence under its law for any

 4   person intentionally to” engage in bribery of foreign officials. Convention on

 5   Combating Bribery and Foreign Public Officials in International Business

 6   Transactions art. 1.1, Dec. 17, 1997, S. Treaty Doc. No. 105-43, 37 I.L.M. 1 (1998)

 7   (hereinafter “OECD Convention”) (emphasis added). The government reads the

 8   words “any person” to apply expansively, including to nonresident foreign

 9   nationals who do not have direct connections to American businesses.

10         The government’s argument falters for two reasons. First, the requirement

11   that intentional bribery by “any person” is illegal is a highly general one; it does

12   not require approval of the precise type of complicity or conspiracy theory

13   involved in this case. Second, Congress carefully considered the “any person”

14   language, and interpreted it in a way that does not involve the government’s

15   theory of liability here. The Senate’s Committee Report first noted that the “any

16   person” text was effectuated by expanding the FCPA to include conduct by

17   foreign nationals within the United States:



                                              57
 1         [T]he OECD Convention calls on parties to cover “any person”; the
 2         current FCPA covers only issuers with securities registered under
 3         the 1934 Securities Exchange Act and “domestic concerns.” The Act,
 4         therefore, expands the FCPA’s coverage to include all foreign
 5         persons who commit an act in furtherance of a foreign bribe while in
 6         the United States.

 7   1998 Senate Report, at 2-3. Congress also associated the “any person” language

 8   with applying criminal, rather than civil, penalties to foreign nationals who

 9   violated the statute as employees or agents of issuers or domestic concerns. 

  4, 5. In short, Congress focused specifically on the text the government discusses,

11   and employed it in a reasonable way that is not connected to complicity or

12   conspiracy liability for foreign nationals.

13         The government next notes that the OECD Convention specifically

14   mentions ancillary theories of liability such as conspiracy and complicity:

15         Each Party shall take any measures necessary to establish that
16         complicity in, including incitement, aiding and abetting, or
17         authorisation of an act of bribery of a foreign public official shall be
18         a criminal offence. Attempt and conspiracy to bribe a foreign public
19         official shall be criminal offences to the same extent as attempt and
20         conspiracy to bribe a public official of that Party.

21   OECD Convention art. 1.2. The government contends that the text of this

22   provision, requiring that conspiracy to bribe a foreign official “shall be [a]

23   criminal offence[] to the same extent as . . . conspiracy to bribe a public official

                                               58
 1   of” the United States, demands that a conspiring foreign national operating

 2   abroad be covered by the FCPA. The government’s argument is that federal

 3   bribery statutes would indeed cover situations where overseas defendants

 4   conspire to bribe an American official.

 5         The difficulty with the government’s position, however, is that this

 6   provision covers the content of substantive law—the particular acts prohibited by

 7   it—not the law’s jurisdictional aspects. A separate part of the Convention

 8   addresses jurisdictional questions. See OECD Convention art. 4. Moreover,

 9   adopting the government’s view that the jurisdictional reach of the FCPA must

10   be coterminous with that of bribery of American officials would transform the

11   FCPA into a law that purports to rule the world. The defendant notes, for

12   example, that bribery statutes covering American officials prohibit not only

13   crimes with foreign national conspirators acting overseas, therefore, under the

14   government’s theory, these statutes likely cover situations in which the entire

15   offense occurred overseas—that is, where there is no U.S. nexus at all except that

16   the official to be bribed is stateside. The government does not dispute this point.

17   Consequently, if read as the government proposes, the above-quoted provision

18   of the Convention would cover conspiracies to bribe foreign officials consisting
                                               59
 1   entirely of actions taken abroad. That is obviously not consistent with the

 2   legislation Congress wrote, and it cannot be what the OECD Convention

 3   requires.

 4         The government also points to provisions about the territorial reach of the

 5   OECD Convention. In particular, the government emphasizes the following

 6   passage:

 7         Each Party shall take such measures as may be necessary to establish
 8         its jurisdiction over the bribery of a foreign public official when the
 9         offence is committed in whole or in part in its territory.

10   OECD Convention art. 4.1. The government essentially believes this passage to

11   establish that, where “any part” of the offense occurs within the United States,

12   the country is required to exercise jurisdiction over someone whose conduct is

13   related to the offense, no matter how attenuated the person’s connection to the

14   acts taken on American soil.

15         The government’s reading is undercut by the commentaries to the OECD

16   Convention, and by Congress’s careful consideration of the provision’s meaning.

17   The accompanying commentary to the Convention states, regarding Article 4.1,

18   that “[t]he territorial basis for jurisdiction should be interpreted broadly so that

19   an extensive physical connection to the bribery act is not required.” OECD

                                               60
 1   Convention cmt. 4.1. This language suggests that the Convention contemplated

 2   jurisdiction over persons with some “physical connection to the bribery act,” even

 3   if not an “extensive” one, rather than persons with no physical connection to the

 4   actions at all. Congress plainly shared this view of the provision. As the

 5   Committee Report noted:

 6         The OECD Convention requires each Party to “take such measures
 7         as may be necessary to establish its jurisdiction over the bribery of a
 8         foreign public official when the offense is committed in whole or in
 9         part in its territory.” OECD Convention, Art. 4, ¶ 1. The new offense
10         complies with this section by providing for criminal jurisdiction in
11         this country over bribery by foreign nationals of foreign officials
12         when the foreign national takes some act in furtherance of the
13         bribery within the territory of the United States.

14   1998 Senate Report, at 5. Congress’s reading, and the view described in the

15   commentaries both comport with the Convention provision’s text. A requirement

16   that a nation “establish its jurisdiction over the bribery of a foreign public

17   official” does not say that it must create jurisdiction over persons in foreign lands

18   with only distant connections to the offense. It is fairly read to mean that a nation

19   that has agreed to the Convention must enact a law covering persons who

20   commit acts within the nation’s own borders.

21                c. The Legislative History’s Demonstration of an Affirmative
22                   Legislative Policy

                                               61
 1         The strands of the legislative history demonstrate, in several ways, the

 2   affirmative policy described above: a desire to leave foreign nationals outside the

 3   FCPA when they do not act as agents, employees, directors, officers, or

 4   shareholders of an American issuer or domestic concern, and when they operate

 5   outside United States territory.

 6         First, it is clear that the FCPA’s enumeration of the particular individuals

 7   who may be held liable under the Act demonstrated a conscious choice by

 8   Congress to avoid creating individual liability through use of the conspiracy and

 9   complicity statutes. As discussed above, the statute’s initial approach was to

10   place liability for bribery largely upon companies, and then to allow prosecution

11   of individuals for conspiring with companies or aiding and abetting their

12   violations of the law. But the Carter Administration objected to that approach,

13   voicing concerns for due process protections and clarity of rules for foreign

14   persons. The statute was amended; the amended version narrowly tailored the

15   liability for foreign individuals, and did not contemplate a reversal of that

16   narrow tailoring by means of conspiracy and complicity theories. These changes

17   were principally discussed in the Senate. But the House bill, and the final

18   legislation, were structured similarly to the Senate’s revised bill. At the same
                                              62
 1   time that the Senate made these changes, the House was revising its own

 2   legislation to cut back on liability placed upon foreign agents, again because of

 3   specific concerns expressed by executive-branch officials regarding overreach.

 4         The 1998 amendments surely extended the statute’s jurisdictional reach.

 5   But in doing so, Congress delineated as specifically as possible the persons who

 6   would be liable, and under what circumstances liability would lie. None of the

 7   changes included liability for the class of individuals involved in this case. And

 8   despite the government’s urging to the contrary, nothing in the OECD

 9   Convention required Congress to create such liability.

10         Congress also repeatedly emphasized that out-of-reach foreign entities

11   should not create concern because American companies would be liable for

12   violating the Act even if they did so indirectly through such persons. See 1998

13   Senate Report at 5 (“Although this section imposes liability only on U.S. persons,

14   it is expected that the established principles of liability, including principles of

15   vicarious liability, that apply under the current version of the FCPA shall apply

16   to the liability of U.S. businesses for acts taken on their behalf by their officers,

17   directors, employees, agents or stockholders outside the United States, regardless

18   of the[ir] nationality . . . .”); 1977 Conference Report at 14 (noting, despite
                                                63
 1   “inherent jurisdictional, enforcement, and diplomatic difficulties raised by the

 2   inclusion of foreign subsidiaries,” “the conferees intend to make clear that any

 3   issuer or domestic concern which engages in bribery of foreign officials indirectly

 4   through any other person or entity would itself be liable under the bill”).

 5         Finally, limitations on liability for foreign nationals based on conspiracy

 6   and complicity theories were sensible given congressional concerns and

 7   aspirations in enacting the FCPA. In passing the statute, Congress was largely

 8   concerned with ensuring the SEC’s ability to supervise and police companies, S.

 9   Rep. No. 95-114, at 2 (1977), reprinted in 1977 U.S.C.C.A.N. 4098, 4099, as well as

10   the negative perception that bribery could create for American companies, its

11   effect on the marketplace, and the foreign policy implications of the conduct, see

12   H.R. Rep. No. 95-640, at 4-6 (1977). But Congress also desired that the statute not

13   overreach in its prohibitions against foreign persons. Protection of foreign

14   nationals who may not be learned in American law is consistent with the central

15   motivations for passing the legislation, particularly foreign policy and the public

16   perception of the United States. And the desire to protect such persons is

17   pressing when considering the conspiracy and complicity statutes: these



                                              64
 1   provisions are among the broadest and most shapeless of American law, and

 2   may ensnare persons with only a tenuous connection to a bribery scheme.

 3         In short, the legislative history of the FCPA further demonstrates

 4   Congress’s affirmative decision to exclude from liability the class of persons

 5   considered in this case and we thus hold that the government may not override

 6   that policy using the conspiracy and complicity rules.

 7      D. Presumption Against Extraterritorial Application

 8         Even if we were not persuaded that Congress had demonstrated an

 9   affirmative legislative policy in the FCPA to limit criminal liability to the

10   enumerated categories of defendants, we would still rule for Hoskins because the

11   government has not established a ““clearly expressed congressional intent to”

12   allow conspiracy and complicity liability to broaden the extraterritorial reach of

13   the statute. RJR 

.

14         The Supreme Court’s recent opinion in RJR Nabisco explained a “two-step

15   framework for analyzing extraterritoriality issues”:

16         At the first step, we ask whether the presumption against
17         extraterritoriality has been rebutted—that is, whether the statute
18         gives a clear, affirmative indication that it applies extraterritorially. .
19         . . If the statute is not extraterritorial, then at the second step we
20         determine whether the case involves a domestic application of the
                                               65
 1         statute, and we do this by looking to the statute’s “focus.” If the
 2         conduct relevant to the statute’s focus occurred in the United States,
 3         then the case involves a permissible domestic application even if
 4         other conduct occurred abroad; but if the conduct relevant to the
 5         focus occurred in a foreign country, then the case involves an
 6         impermissible extraterritorial application regardless of any other
 7         conduct that occurred in U.S. territory.

 8         What if we find at step one that a statute clearly does have
 9         extraterritorial effect? . . . . [W]e addressed this issue in Morrison [v.
10         National Australia Bank Ltd., 

(2010)] explaining that it
11         was necessary to consider § 10(b)’s “focus” only because we found
12         that the statute does not apply extraterritorially: “If § 10(b) did apply
13         abroad, we would not need to determine which transnational frauds
14         it applied to; it would apply to all of them (barring some other
15         limitation).” The scope of an extraterritorial statute thus turns on the
16         limits Congress has (or has not) imposed on the statute’s foreign
17         application, and not on the statute’s “focus.”

18   

(internal citation omitted).

19         In RJR Nabisco, the Court evaluated the extraterritorial application of the

20   RICO Act. As the Court noted, the RICO Act does not describe distinctive

21   conduct not punished by other laws. 

A given violation of the RICO

22   Act is based on a pattern of violations of other criminal statutes—so-called

23   “predicate offense[s]”—named within the RICO Act. 

defendant

24   commits several “predicate offenses” within a given period of time, the

25   defendant may be sued for a separate racketeering offense under RICO.


                                                66
 1          Applying the test quoted above, the Court determined that the RICO Act

 2   “applie[d] to foreign racketeering activity—but only to the extent that the

 3   predicates alleged in a particular case themselves apply extraterritorially.” 

  2102. The Court emphasized that “foreign conduct must violate a predicate

 5   statute that manifests an unmistakable congressional intent to apply

 6   extraterritorially.” Id (internal quotation marks omitted). That is because, “‘when

 7   a statute provides for some extraterritorial application, the presumption against

 8   extraterritoriality operates to limit that provision to its terms.’” 

).

10          Even after determining that certain substantive provisions of the RICO Act

11   applied extraterritorially, the Court ruled that the statute’s provision allowing a

12   private right of action—the basis of the legal claims in RJR Nabisco—did not

13   apply extraterritorially. 

The Court’s conclusion was based on its

14   reading of the statute, as well as its observation that “providing a private civil

15   remedy for foreign conduct creates a potential for international friction beyond

16   that presented by merely applying U.S. substantive law to that foreign conduct.”

17   

                                               67
 1         In brief, the Supreme Court’s teachings in RJR Nabisco were that (1) when a

 2   statute includes some extraterritorial application, that application is limited by

 3   the statute’s terms, and that (2) remedial provisions must be analyzed

 4   independently to discern whether they permit extraterritorial application. 10

 5   These principles, though articulated in the RICO context, are consistent with

 6   prior rulings by a number of courts regarding extraterritorial liability based on

 7   the conspiracy and complicity statutes. Those statutes, like RICO, do not create

 8   new substantive offenses, but merely allow liability for other legal violations.

 9   Accordingly, courts have repeatedly ruled that “[g]enerally, the extraterritorial

10   reach of an ancillary offense like aiding and abetting or conspiracy is

11   coterminous with that of the underlying criminal statute.” United States v. Ali, 718

, 939 (D.C. Cir. 2013); see also United States v. Yakou, 

, 252

13   (D.C. Cir. 2005) (“The aiding and abetting statute, however, is not so broad as to



     10The government cites European Cmty. v. RJR Nabisco, Inc., 

, 142 (2d
     Cir. 2014), rev’d, 

(2016) for the proposition that if all elements of a
     statute are satisfied, “that statute is violated even if some further conduct
     contributing to the violation occurred outside the United States.” [Gray 14-15.]
     But the government neglects to mention that the text directly preceding this
     statement instructs that the proposition only applies to a statute “that does not
     apply extraterritorially.” 

FCPA applies extraterritorially, so the
     proposition the government cites is inapplicable here.
                                                 68
 1   expand the extraterritorial reach of the underlying statute.”); United States v. Hill,

 2   

, 739 (9th Cir. 2002) (“[A]iding and abetting, and conspiracy . . . have

 3   been deemed to confer extraterritorial jurisdiction to the same extent as the

 4   offenses that underlie them.”); see also United States v. Bowman, 

(1922)

 5   (considering the extraterritorial application of the substantive offense and of a

 6   conspiracy charge without distinction).

 7         These rules demonstrate that the conspiracy and complicity statutes may

 8   not be used to bring the charges involved in this appeal. Because some

 9   provisions of the FCPA have extraterritorial application, “‘the presumption

10   against extraterritoriality operates to limit th[ose] provision[s] to [their] terms,’”

11   RJR 

(quoting 

). And, as

12   detailed at length above, the FCPA does not impose liability on a foreign national

13   who is not an agent, employee, officer, director, or shareholder of an American

14   issuer or domestic concern—unless that person commits a crime within the

15   territory of the United States, see 15 U.S.C. § 78dd-3 (providing liability for

16   persons “other than an issuer . . . or a domestic concern . . . or . . . any officer,

17   director, employee, or agent of such person or any stockholder thereof” only if

18   the person’s conduct is undertaken “while in the territory of the United States”).
                                                 69
 1   In other words, the territorial limitations of the FCPA preclude liability for such a

 2   person. The government may not expand the extraterritorial reach of the FCPA

 3   by recourse to the conspiracy and complicity statutes.

 4         The government cites numerous cases that it believes to stand for the

 5   proposition that the conspiracy and complicity statutes can cover extraterritorial

 6   conduct even when the underlying statute does not. See, e.g., Ford v. United States,

 7   

(1927); United States v. Inco Bank & Tr. Corp., 

(11th Cir.

 8   1988); United States v. Winter, 

(5th Cir. 1975); United States v. Lawson,

 9   

(7th Cir. 1974); Rivard v. United States, 

(5th Cir. 1967).

10   But these cases all considered statutes prohibiting illegal importation of various

11   items—statutes that certainly contemplated the punishment of extraterritorial

12   action of precisely the kind that the defendants in the cases were convicted. See

13   

(conspiracy to import liquor into the United States); Inco

14   

(conspiracy to defraud the United States by laundering

15   money); 

(importation of marijuana); 

  435 (importation of cocaine); 

(importation of heroin). The

17   government cites no case in which a statute drew specific lines as to its

18   extraterritorial application, and those lines were exceeded using the conspiracy
                                               70
 1   or complicity theories. The argument thus poses no difficulty for our

 2   understanding of RJR Nabisco and related principles of the extraterritorial

 3   application of conspiracy and complicity rules.

 4         Consequently, the presumption against extraterritoriality bars the

 5   government from using the conspiracy and complicity statutes to charge Hoskins

 6   with any offense that is not punishable under the FCPA itself because of the

 7   statute’s territorial limitations. That includes both charges that are the subject of

 8   this motion—conspiracy to violate Sections 78dd-2 and 78dd-3 of the FCPA, and

 9   liability as an accomplice for doing so—because the FCPA clearly dictates that

10   foreign nationals may only violate the statute outside the United States if they

11   are agents, employees, officers, directors, or shareholders of an American issuer

12   or domestic concern. To hold Hoskins liable, the government must demonstrate

13   that he falls within one of those categories or acted illegally on American soil.

14      III.   The Second Object of the Conspiracy

15         Notwithstanding this Court’s conclusion that Hoskins cannot be held

16   liable under the FCPA if he is not in the categories of persons directly covered by

17   the statute, the government argues that it was error for the district court to

18   dismiss the second object of the conspiracy. We agree.
                                               71
 1         The second object alleges that Hoskins willfully conspired with various co-

 2   defendants to, “while in the territory of the United States,” commit acts in

 3   furtherance of bribing foreign officials in violation of Section 78dd-3. Indictment

 4   ¶ 26(b). The district court held that, because “it is undisputed that Mr. Hoskins

 5   never entered the territory of the United States and thus could not be prosecuted

 6   under this section,” Gebardi barred the government from charging Hoskins with

 7   the second object of the conspiracy. 

n.14. This

 8   Court agrees that Hoskins cannot be directly liable under Section 78dd-3.

 9   However, the government “maintains that it still intends to prove that [Hoskins]

10   acted as an agent of a domestic concern liable as a principal for the substantive

11   FCPA counts charged in the indictment” in violation of Section 78dd-2. 

-

12   19 n.1. Provided that the government makes this showing, there is no affirmative

13   legislative policy to leave his conduct unpunished, nor is there an extraterritorial

14   application of the FCPA. Accordingly, the government should be allowed to

15   argue that, as an agent, Hoskins committed the first object by conspiring with

16   employees and other agents of Alstom U.S. and committed the second object by

17   conspiring with foreign nationals who conducted relevant acts while in the

18   United States.
                                              72
1         Accordingly, the district court erred in concluding that Hoskins was

2   incapable of conspiring to violate Section 78dd-3 because he was never in the

3   United States and we reverse this portion of the holding with instructions for the

4   district court to reinstate the second object of the conspiracy.

5                                     CONCLUSION

6         We have considered the government’s remaining arguments and find

7   them to be without merit. Accordingly, the district court’s orders are AFFIRMED

8   in part and REVERSED in part.




                                             73
 1   GERARD E. LYNCH, Circuit Judge, concurring:

 2         I join in Judge POOLER’s thorough opinion for the Court, and write only to

 3   state why I regard this as a close and difficult case. 

 4                                              I

 5         The operative indictment in this case charges, among other things, that

 6   Lawrence Hoskins, a senior vice president of a foreign corporation based abroad,

 7   (1) conspired with others, among them named employees of a Connecticut power

 8   company that is a subsidiary of the foreign corporation for which Hoskins

 9   worked, to commit offenses against the United States, including to violate the

10   Foreign Corrupt Practices Act (“FCPA”), 15 U.S.C. § 78dd‐2, by bribing

11   Indonesian public officials, and (2) committed substantive violations of that

12   statute in that he aided and abetted those American individuals who engaged in

13   the charged bribery.

14         For purposes of this appeal, we assume that Hoskins was neither an

15   employee nor an agent of a domestic concern.1 He therefore does not fall within

16   the terms of the statute, any more than the get‐away driver for a bank robbery


     1
 1     See Court Op. 4 n.1. The district court dismissed the indictment only insofar as
 2   it relies on the conspiracy and aiding and abetting theories, and left the charges
 3   against Hoskins intact insofar as he is charged as an “agent” of an American
 4   entity.
 1   team has personally “by force and violence . . . take[n] . . . from the person or

 2   presence of another . . . any property . . . belonging to . . . any bank.” 18 U.S.C.

 3   § 2113(a). He did not, by his own actions, commit the acts prohibited by the

 4   FCPA, nor is he within the class of individuals who could commit the prohibited

 5   acts.

 6           The problem for Hoskins, however, as for the get‐away driver, is that 18

 7   U.S.C. § 2 punishes “as a principal” anyone who, although he or she does not

 8   personally commit the acts constituting the offense, “aids, abets, counsels,

 9   commands, induces or procures” the commission of those acts by another; in

10   addition, 18 U.S.C. § 371 punishes anyone who “conspire[s]” with another to

11   commit the offense. The indictment in this case expressly charges that someone

12   (specifically the alleged co‐conspirator Pomponi, who was an employee or agent

13   of a domestic concern) did engage in substantive violations of the FCPA, and that

14   Hoskins conspired with, and aided and directed, that person in the commission

15   of the offense. 

16           As the opinion for the Court expressly recognizes, were we to rely solely

17   on “the plain language of the general statutes regarding conspiracy and

18   accessorial liability — which nothing in the text of the FCPA purports to override


                                                2
 1   or limit – if Hoskins did what the indictment charges, he would appear to be

 2   guilty of conspiracy to violate the FCPA and (as an accomplice) of substantive

 3   violations of that statute,” Court Op. 19S20, just as the wheelman for the bank

 4   robbery team is guilty of conspiracy and of substantive violations of the bank

 5   robbery statute. That is precisely the result that the conspiracy and complicity

 6   statutes,  and the common‐law doctrines that long preceded such statutes and

 7   which the statutes codify, are designed to effect. 

 8         Moreover, as the Court also recognizes, the fact that the FCPA specifies

 9   that only particular classes of people can violate the law by bribing foreign

10   officials does not in itself restrict the reach of conspiratorial or aiding and

11   abetting liability to those same classes of people. Many offenses are defined such

12   that they may be committed only by the actions of particular types of people. But

13   as the Court’s opinion ably documents, “the firm baseline rule with respect to

14   both conspiracy and complicity is that where the crime is so defined that only

15   certain categories of persons . . . may commit the crime through their own acts,

16   persons not within those categories can be guilty of conspiring to commit the

17   crime or of the substantive crime itself as accomplices.” Court Op. 21. That is not

18   only the rule established by federal precedent; as the Court notes, that position is


                                                3
 1   “universally held” in the states and in other Anglo‐American jurisdictions. 

 quoting the American Law Institute, Model Penal Code and Commentaries,

 3   § 2.06 at 323 (1985).2

 4         That baseline principle, like most principles, admits of exceptions, some of

 5   which have longstanding common‐law roots. One such exception, as the Court’s

 6   opinion notes, is exemplified by the Supreme Court’s opinion in Gebardi v. United

 7   States, 287 U.S. 112 (1932). Sometimes we can infer from the apparent purpose of

 8   the statute that the legislature cannot have intended to extend accessorial liability

 9   to a class of persons who might better be thought of as victims of the crime (such

10   as a willing underage participant in a sex act defined as rape because of the

11   underage party’s incapacity to consent, even where the minor intentionally

12   facilitates the act and is old enough to have the capacity to commit a crime), or



     2
      For example, 18 U.S.C. § 656 makes it a crime for an “officer, director, agent or
     employee of” certain banking institutions to “embezzle[ ] . . . or misappl[y]” the
     bank’s funds. But it would be quite peculiar if the language of the law defining
     the kinds of persons who could be the principals of an embezzlement scheme
     precluded from liability, by that very definition, those who aid or induce a bank
     officer to engage in acts of embezzlement. Thus, if a bank officer persuades a
     friend with computer expertise to write code that could be insinuated into the
     bank’s computers to divert funds into the officer’s account, in exchange for a
     share of the proceeds of the crime, the computer‐savvy friend would of course be
     punishable for knowingly joining and assisting the criminal plan.

                                               4
 1   where a legislative sentencing scheme distinguishes levels of culpability among

 2   various participants, and treating the less culpable party as an accomplice of the

 3   more culpable one would undermine that scheme (as in the case of narcotics

 4   transactions, where possessors of illegal drugs for their own use are punished

 5   less severely than distributors; the purchaser is not treated as the accomplice of

 6   the seller even though he or she intentionally facilitates the sale).3

 7         This exception, however, must be construed narrowly. Discerning when

 8   the legislature “must have” intended to exempt a particular class of persons from

 9   the plain text of its statutes is a tricky business. What, after all, in the language or

10   structure of the statute distinguishes one statute that limits the category of

11   principal offenders from another, such that some few should be singled out as

12   clearly intending to preclude some persons outside that category from liability,

13   and distinguished from the general run of statutes where no such intention can


     3
 1    The latter aspect of the exception largely accounts for United States v. Amen, 831
 2   F.2d 373 (2d Cir. 1987). The “continuing criminal enterprise” or “kingpin” statute,
 3   21 U.S.C. § 848, is essentially a sentence‐enhancing statute that identifies some
 4   drug dealers as worthy of increased punishment because of the extent and
 5   magnitude of their criminal acts. To apply accessorial liability as a way of
 6   bumping the kingpin’s henchmen up to the same level of punishment because
 7   they help him in his enterprise would disrupt the legislature’s intention to
 8   impose graduated punishments according to various conspirators’ different
 9   levels of involvement in the narcotics trade.

                                                5
 1   be discerned? Nothing, or at least not much, in the statutes at issue tells us to

 2   exclude some or all persons not within the designated category from accomplice

 3   liability. 

 4          In my view, it is helpful in most cases to look to the traditional principles

 5   derived from the common law, and embodied in the legislation and judicial

 6   decisions of the fifty states, which have the primary responsibility for enforcing

 7   criminal law in this country. That is not an idiosyncratic position of my own; it

 8   was the view expressed by Justice Jackson, writing for a unanimous Supreme

 9   Court in Morissette v. United States, 342 U.S. 246 (1952). The Morissette Court

10   looked to the common law and the rulings of “[s]tate courts of last resort, on

11   whom fall the heaviest burden of interpreting criminal law in this country,” to

12   interpret a federal statute (the prohibition on theft of federal property, now

13   codified at 18 U.S.C. § 641) that lacked “any express prescription of criminal

14   intent.” Id. at 260–61. Justice Jackson concluded that, since Congress acted against

15   the backdrop of “an unbroken course of judicial decision in all constituent states

16   of the Union,” its silence about mens rea reflected the adoption of common‐law

17   principles, rather than their rejection. Id. at 261–62.

18          As our principal opinion today correctly points out, the Supreme Court in


                                                6
 1   Gebardi seems to have considered its ruling, rejecting conspiratorial liability

 2   under the Mann Act for women who agreed to be transported across state lines,

 3   as a slight extension of the traditional common‐law rules. Court Op. 26S27. But

 4   this fact alone would not persuade me that Gebardi opens a broad door to finding

 5   “legislative policy” exceptions to the general principle that persons outside

 6   defined legislative categories of principal liability may still be guilty of

 7   conspiracy and complicity. In codifying the general consensus of common‐law

 8   complicity principles, the Model Penal Code confined the exceptions to two

 9   closely related situations, proposing to exclude from accomplice liability only

10   “victim[s] of [the] offense,” MPC § 2.06(6)(a), and those whose “conduct is

11   inevitably incident to its commission” in light of the definition of the offense, 

 2.06(6)(b). The Commentary to these proposals, which extensively discusses the

13   many decisions classifying persons as accomplices or not across a variety of

14   crimes, treats Gebardi as an example of the latter exception. See American Law

15   Institute, Model Penal Code and Commentaries, § 2.06 at 323S25 & nn.74, 82.4 


     4
      Indeed, the language of the second exception is closely derived from that of
     Justice Stone in Gebardi, who wrote:
                  We think it a necessary implication of that policy that
                  when the Mann Act and the conspiracy statute came to
                  be construed together, as they necessarily would be, the

                                                7
 1         The Fifth Circuit’s decision in United States v. Castle, 925 F.2d 831 (5th Cir.

 2   1991), illustrates a classic application of the Gebardi principle to the FCPA. There,

 3   the government attempted to prosecute the foreign official who received a bribe

 4   from representatives of a domestic concern for conspiracy to violate the FCPA.

 5   Such a prosecution runs directly in the face of Gebardi and its common‐law

 6   predecessors. As the Fifth Circuit ruled, “Congress intended in both the FCPA

 7   and the Mann Act to deter and punish certain activities which necessarily

 8   involved the agreement of at least two people, but Congress chose in both

 9   statutes to punish only one party to the agreement.” Id. at 833. Thus, “the very

10   individuals whose participation was required in every case — the foreign

11   officials accepting the bribe — were excluded from prosecution for the

12   substantive offense.” Id. at 835. In such a case, it makes sense to conclude that

13   Congress must have intended to impose liability only on the American bribe


                  same participation which the former contemplates as an
                  inseparable incident of all cases in which the woman is a
                  voluntary agent at all, but does not punish, was not
                  automatically to be made punishable under the latter.  It
                  would contravene that policy to hold that the very
                  passage of the Mann Act effected a withdrawal by the
                  conspiracy statute of that immunity which the Mann
                  Act itself confers.
     267 U.S. at 123 (emphasis added).

                                               8
 1   giver, and not on the foreign official who receives the bribe, even though the

 2   latter plainly facilitates the criminal conduct of the bribe giver. The legislative

 3   history cited in the Court’s opinion corroborates that intuition. If anything is clear

 4   from that history, it is that Congress was concerned about intruding into foreign

 5   sovereignty by attempting to punish under American law foreign officials taking

 6   bribes from Americans on their own soil.

 7         It is not at all clear to me, however, that Hoskins benefits from the Gebardi

 8   principle. Although every bribe given by an American company to a foreign

 9   government official in return for favorable official treatment inherently involves

10   such a foreign official (the foreign official’s receipt of the bribe is an “inseparable

11   incident,” in Justice Stone’s phrase, of the American bribe‐giver’s violation of the

12   FCPA), not every such bribe involves the direction of the American company’s

13   action, or the provision of expert advice on how to execute the scheme, by an

14   executive of a foreign parent of the American company. Thus, while Congress

15   could not help but be aware that every bribe given abroad by an affiliate of an

16   American entity involved by definition a foreign official who received the bribe,

17   there is no particular reason to think that the conceivable (but somewhat arcane)

18   case of a foreign parent company’s executives who directed, supervised, or


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 1   assisted an American company to pay a bribe was necessarily present to the

 2   minds of the members of Congress who voted to adopt the FCPA.

 3                                             II

 4         If this case involved an ordinary criminal statute with purely domestic

 5   applications, then, I would likely reach a different conclusion here. But as Justice

 6   Jackson also explained in Morissette, while in many cases Congress can best be

 7   understood to have created federal criminal law against the backdrop of

 8   traditional common‐law principles of criminal liability, in some instances

 9   Congress faces novel situations not anticipated by the common law of crimes,

10   and legislates “to call into existence new duties and crimes.” 342 U.S. at 253. In

11   doing so, Congress may have to deal with issues that are unique to federal law.

12         The FCPA, for example, is not an ordinary domestic criminal law, but a

13   novel expansion of criminal liability to impose duties on American businesses to

14   conform to domestic ethical standards even when they operate beyond our

15   borders, in lands with different cultures, laws, and traditions. I agree with my

16   colleagues that the extraterritorial effects of the FCPA require us to exercise

17   particular caution before extending its reach even farther than that expressly

18   declared by the statutory text. Although the FCPA explicitly and by design


                                              10
 1   applies extraterritorially, the same concerns that generate a presumption against

 2   implying extraterritorial application of United States law, see Morrison v. National

 3   Australia Bank, Ltd., 561 U.S. 247 (2010) warrant special caution in applying

 4   normal principles of accessorial liability when Congress has delineated the

 5   particular circumstances in which the statute applies abroad. 

 6         In adopting the FCPA, Congress sought to criminalize wrongful conduct

 7   by Americans and those who in various ways work with Americans, while

 8   avoiding unnecessary imposition on the sovereignty of other countries whose

 9   traditions and laws may differ from our own. The legislative history described in

10   the Court’s opinion demonstrates that, in confronting the delicate line‐drawing

11   exercises involved in balancing these concerns, Congress intended to limit the

12   overseas applications of the statute to those that it explicitly defined. The

13   particular situation of someone like Hoskins, who is alleged to have participated

14   in directing or assisting Americans to violate the FCPA, was not explicitly

15   discussed by Congress, and such a case might well never have occurred to those

16   drafting the law. The extraterritorial application that primarily concerned

17   Congress was the potential intrusion into the sovereignty of the nations whose

18   officials were bribed. But we do not sit to decide how Congress might have


                                               11
 1   written the law if it had specifically considered this case. We can only apply the

 2   law that Congress did write, which limits the extraterritorial application of the

 3   FCPA to specific cases that do not include Hoskins’s situation.

 4         I therefore think that a combination of the presumption against

 5   extraterritorial application of United States law generally discussed in Part II D of

 6   the majority opinion, and the legislative history, discussed in Part II C 3

 7   demonstrating that Congress drew lines in the FCPA out of specific concern

 8   about the scope of extraterritorial application of the statute, warrant affirmance of

 9   the district court’s partial dismissal of the indictment in this case. 

10                                             III

11         I would be remiss, finally, not to note that Congress might want to revisit

12   the statute with this case in mind, as the result we reach today seems to me

13   questionable as a matter of policy. The FCPA represents an effort by the United

14   States to keep its own nationals free of corruption when dealing in foreign

15   countries where corruption is endemic. Such corruption undermines the ethical

16   foundations of American businesses, and risks accustoming American

17   businesspeople and corporations to corrupt practices that they encounter abroad,

18   with the attendant possibility of importing back to the United States practices


                                                12
 1   they become familiar with in countries with less developed principles of the rule

 2   of law and the transparency and impartiality of government regulation.

 3   Moreover, by embroiling American companies in the corrupt activities of foreign

 4   officials, such bribery tends to perpetuate the corruption of developing nations,

 5   to the long‐run disadvantage of the United States both in foreign policy (by

 6   associating the United States and its citizens and businesses with unpopular

 7   corrupt regimes) and in commerce (by perpetuating the corruption “tax” levied

 8   on all those who do business with such regimes). See Court Op. 50S51 & n.7

 9   (discussing purposes of the FCPA).

10         As noted above, these important purposes must be balanced against a

11   concern about intruding into foreign sovereignty. It is thus not surprising that

12   Congress chose to stop American businesses from engaging in the corrupt

13   cultures of countries where they may do business, but did not attempt to reform

14   those countries themselves by punishing their public officers.

15         If the charges in the indictment are proved true, however, the prosecution

16   of Hoskins does not implicate that concern. Hoskins was not an official of a

17   corrupt foreign government, operating in a legal and business culture distinct

18   from that of the United States and other Western democracies. He was, rather, a


                                             13
 1   citizen of the United Kingdom, employed by a British subsidiary of the French

 2   parent company of the American entity that allegedly paid bribes to Indonesian

 3   legislators to secure business for the American company, working in France from

 4   the offices of a French subsidiary of the same French parent. Both his country of

 5   citizenship (the United Kingdom) and the country where he worked and where

 6   the company whose interests he was ultimately advancing was incorporated

 7   (France) are signatories of the Organisation for Economic Co‐operation and

 8   Development (“OECD”) Convention on Combating Bribery of Foreign Public

 9   Officials in International Business Transactions, and are thus committed, as is the

10   United States, to enacting legislation along the lines of the FCPA.5 Although any

11   prosecution of a foreign national for actions taken on foreign soil raises some

12   concern about possible friction with other countries, the prosecution of someone

13   in Hoskins’s position does not threaten a foreign country’s sovereign power to

14   select, retain, and police the officials of its own government, nor does it conflict

15   with the policies of the countries involved.


     5
      As the Court’s opinion describes, the OECD Convention was a diplomatic
     initiative of the United States to encourage its principal trading partners and
     competitors in international commerce to enact anti‐corruption laws similar to
     those of the FCPA. The 1998 FCPA amendments were adopted in part to conform
     American law to the Convention’s requirements. See Court Op. 55S63.

                                               14
 1         Nor were the effects of Hoskins’s alleged actions felt only in his own

 2   countries of citizenship and employment. Hoskins is alleged to have been part of

 3   the team that reached into the United States to counsel and procure the

 4   commission of an American crime by an American company, and to assist that

 5   company in executing bribes in violation of American law. A prosecution on

 6   these facts does not evince an effort by the United States to “rule the world,” RJR

 7   Nabisco, Inc. v. European Cmty., 136 S. Ct. 2090, 2100 (2016), but rather an effort to

 8   enforce American law against those who deliberately seek to undermine it.

 9         Moreover, the FCPA explicitly contemplates the prosecution of at least

10   some foreign nationals who operate entirely abroad, in that it penalizes foreign

11   nationals who act as the agents of American companies in paying bribes abroad.

12   Thus, for example, if Alstom U.S. had channeled its bribes to Indonesian officials

13   through Indonesian citizens who were low‐level Alstom employees in Indonesia,

14   the FCPA would appear to penalize those employees. Indeed, our decision today

15   leaves intact the possibility that Hoskins himself may be convicted under this

16   indictment for violating the FCPA, if the government establishes that he

17   functioned as the agent of the American company, rather than as one who

18   directed the actions of the American company in the interests of its French parent


                                               15
 1   company. That seems to me a perverse result, and one that is unlikely to have

 2   been specifically anticipated or intended by Congress. It makes little sense to

 3   permit the prosecution of foreign affiliates of United States entities who are

 4   minor cogs in the crime, while immunizing foreign affiliates who control or

 5   induce such violations from a high perch in a foreign parent company. That is the

 6   equivalent of punishing the get‐away driver who is paid a small sum to facilitate

 7   the bank robber’s escape, but exempting the mastermind who plans the heist.

 8         It is for Congress to decide whether there are sound policy reasons for

 9   limiting the punishment of foreign nationals abroad to those who are agents of

10   American companies, rather than to those who make American companies their

11   agents. Our only task is to enforce the laws as Congress has written them. While I

12   see no reason to believe that Congress specifically contemplated a case quite like

13   this one, I agree that the lines drawn in the FCPA, which were crafted specifically

14   to define when extraterritorial prosecutions would be permitted, do not

15   encompass the present case. I therefore concur in the opinion and judgment of

     the Court.




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