Disgorgement

News & Analysis as of

SEC Charges KKR With Misallocating Broken Deal Expenses

Everyone knew the SEC would pursue a marquee-name private equity sponsor for misallocating expenses. It finally happened, with KKR settling charges for misallocating “broken deal” expenses. Charges against others are likely...more

Disgorgement Penalty for Unlicensed Contractors in California

California has some of the toughest penalties in the country for unlicensed contractors. An unlicensed contractor is not just a contractor without a license, but could also be a contractor who is not correctly licensed or a...more

Cephalon and Teva's $1.2 Billion Consent Order with the FTC: Is it Really a Harbinger of Things to Come?

On June 17, 2015, the U.S. District Court for the Eastern District of Pennsylvania approved a consent order (the “Consent Order”) between the Federal Trade Commission and defendants Cephalon, Inc. and its parent, Teva...more

Sixth Circuit Holds No Disgorgement of Profits Based on Wrongfully Denied ERISA Disability Benefits

The Sixth Circuit Court of Appeals, sitting en banc, recently decided a closely-watched case regarding the scope of "other appropriate equitable relief" under ERISA Section 502(a)(3). In Rochow v. LINA, the court held that...more

Focus on Tax Controversy and Litigation - Supreme Court Decides Maryland v. Wynne and Rules that Maryland Tax Scheme Is...

In This Issue: - Maryland’s Tax Scheme Ruled Unconstitutional - “FTC Generator” Case Update - FSA Rules that Equitable Disgorgement May be Deductible Expense - District Court Upholds Attorney Client...more

The Costs and Risks of Corruption: Impacts beyond the Bribe

Anti-corruption news often revolves around the costly criminal and civil enforcement penalties paid by companies caught in corruption scandals. In the U.S., those costs often reach the hundreds of millions of dollars and are...more

SEC Settles Another Insider Trading Case Tied To Brocade Deal

The acquisition of Foundry Networks, Inc., a networking hardware company, by Brocade Communications System, Inc., a technology company specializing in data and storage networking products, announced on July 21, 2008, has...more

Another SEC Insider Trading Case: Does it Comply With Newman?

The SEC continues to bolster its allegations regarding the relationships between tipper and tippee in insider trading cases as well as the knowledge of the tippee. Whether those allegations will be sufficient to meet the...more

IRS Informally Rules Disgorgement Payments Under FDA Consent Decree May Be Deductible

In Internal Revenue Service Field Attorney Advice released May 22, 2015 (FAA 20152103F), the IRS Office of Chief Counsel expressed its informal view that the evidence suggests that the amount the taxpayer paid the United...more

CFPB Director Cordray Issues First-Ever Agency Appellate Decision in RESPA Case

The Director of the Federal Consumer Financial Protection Bureau (CFPB), Richard Cordray, issued a decision yesterday in the first appeal of a Bureau administrative enforcement action. Cordray’s decision upholds in part,...more

Tariff Compliance Is Not Enough: FERC Imposes Nearly Thirty-Five Million Dollars in Penalties and Disgorgement against Powhatan...

On May 29, 2015, the Federal Energy Regulatory Commission (“FERC”) issued an Order against Powhatan Energy Fund, LLC and its trading partners, Dr. Houlihan Chen, HEEP Fund, LLC and CU Fund, Inc. (together, “Powhatan”). FERC...more

Apple v. Samsung: Design Patents Reap Profits

Design patents are an often-overlooked form of intellectual property, lying somewhere at the crossroads of trademark law, utility patent law, and copyright law. After the Federal Circuit's May 18, 2015 decision in Apple v....more

FTC’s $1.2 Billion Disgorgement Settlement With Cephalon: Heightened Scrutiny of Hatch-Waxman Settlements

On May 28, 2015, the Federal Trade Commission (FTC) announced the settlement of its 2008 lawsuit against Cephalon, Inc. (now owned by Teva Pharmaceutical Industries, Ltd.), which alleged that Cephalon had made “reverse...more

Building Contractors Beware!! An Unreported Judgment Can Lead To A Suspension Of Your Contractor’s License And Payment Issues!

On May 18, 2015, the California Court of Appeals, Second District ruled in Pacific Caisson & Shoring, Inc. v. Bernards Bros., Inc. 2015 DJDAR 5486 that a contractor, whose license was suspended for failing to notify the...more

May Antitrust Bulletin

On April 27, 2015, Applied Materials Inc. and Tokyo Electron Ltd. abandoned their merger plans after facing pushback from the Department of Justice (DOJ). The merger, which has been pending since September 2013, would have...more

Federal Trade Commission Obtains a Near Record-Breaking Disgorgement in a Monopolization Case

On April 20, 2015, the Federal Trade Commission (“FTC”) announced that Cardinal Health, Inc. (“Cardinal”), agreed to pay $26.8 million to resolve allegations that it violated Section 2 of the Sherman Act by monopolizing the...more

Recent Court and Agency Actions Suggest Increased Antitrust Risk Over Disgorgement, Particularly in the Pharmaceutical Industry

Recent court and agency rulings highlight important takeaways involving disgorgement in antitrust proceedings. Companies, especially those in the pharmaceutical industry, increasingly should ensure they properly calibrate...more

FTC Obtains $26.8 Million in Disgorgement to Settle Monopolization Claims

On April 17, 2015, the Federal Trade Commission (FTC) entered into a settlement with Cardinal Health, Inc. (Cardinal) to resolve allegations that Cardinal, the largest and in certain areas the sole operator of...more

Deutsche Bank Settles LIBOR Charges With FCA, DOJ, CFTC, NY State

Deutsche Bank paid $2.519 billion in fines and disgorgement, a subsidiary pleaded guilty to criminal charges and the parent entered into a three year deferred prosecution agreement which requires a monitor to resolve charges...more

FTC Settles Radioactive Allegations Against Cardinal Health with a Near Record-Breaking Disgorgement Agreement

In a 3-2 decision, as part of its aggressive antitrust enforcement in health care industries, the Federal Trade Commission (FTC or the Commission) announced that Cardinal Health, Inc. (Cardinal) agreed to pay $26.8 million to...more

SEC Files Two Offering Fraud Actions Tied To A Horse Farm

The Commission filed two settled offering fraud actions centered in part around an entity engaged in the purchase and sale of thoroughbred horses called Raintree Racing. A second involved an offering of interests in a real...more

FTC Seeks to Secure First Disgorgement in Nearly a Decade

The FTC announced yesterday that Cardinal Health, Inc. (“Cardinal”) has agreed to pay $26.8 million to resolve its investigation into the company’s alleged anticompetitive behavior. If approved by a federal court, the...more

FLIR FCPA Action Highlights: Continued Focus on Penalizing Improper Expenditures for Government Officials

FLIR Systems, Inc. (“FLIR”), a publicly traded company based in Oregon, agreed to pay approximately $9.5 million to settle allegations of violations of the Foreign Corrupt Practices Act (“FCPA”) on April 8, 2015. The U.S....more

SEC Imposes $6 Million in Penalties for Straw Purchaser Arrangement

On March 26, 2015, the SEC settled charges against 22 parties relating to arrangements by which companies not registered as broker-dealers purchased securities on behalf of Global Fixed Income, LLC (GFI) and received...more

FCPA Compliance and Ethics Report-Episode 145-SEC Enforcement of the FCPA, Part II [Video]

In this episode which is Part II of my look at SEC enforcement of the FCPA, I consider whether profit disgorgement is available to the SEC in a strict liability enforcement action of violation of internal controls. ...more

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