SEC v. Avery Dennison Corporation (C.D. Cal. 2009)
In the Matter of Avery Dennison Corporation (2009)

• Case Name
• SEC v. Avery Dennison Corporation (C.D. Cal. 2009)
  In the Matter of Avery Dennison Corporation (2009)

• Date Filed
• 08/19/2009

• Enforcement Agency
• SEC

• Countries
• China, Indonesia

• Foreign Official
• Chinese government officials; Indonesian customs and tax officials.  

• Date of Conduct
• 2002 to 2005

• Nature of Business
• Procurement of sales of reflective materials in China used in printing and road signs where Chinese government required authorization for such products.  Avery China, a wholly-owned subsidiary of Avery Dennison Corporation (“Avery Dennison”), a Delaware entity, sells reflective materials commonly used in printing and road signs. 

• Influence to be Obtained
• The Chinese government requires authorization for all products used in road communications and safety.  Between 2002 and 2005, Avery China attempted to pay Chinese government officials kickbacks to obtain such authorization and gain lucrative contracts.  Some of the illegal payment schemes were discovered and prevented by Avery Dennison employees, while others were paid out, including a $24,752 payment to a project manager in 2005 to obtain profits of $273,213 on a sale.  In addition, Avery China hosted expensive sightseeing trips to curry favor with Chinese government officials in both 2002 and 2005.  In 2007, Avery Dennison acquired Paxar Corporation, a NYSE listed company.  Avery Dennison later discovered that Paxar employees in Indonesia made illegal payments to customs and tax officials to obtain bonded zone licenses and to overlook bonded zone regulatory violations.

• Enforcement
• On July 28, 2009, the SEC filed two settled enforcement proceedings against Avery Dennison.  The SEC filed a federal civil action in California charging Avery Dennison with violations of the books and records and internal controls provisions of the FCPA and seeking a civil penalty.  The SEC also issued an administrative order finding that Avery Dennison violated the same provisions of the FCPA, ordering the company to cease and desist from these violations and disgorge profits in the amount of $273,213 plus $45 257 in prejudgment interest.  Avery Dennison agreed to the entry of a final judgment, entered August 18, 2009, requiring it to pay a civil penalty in the amount of $200,000.

• Amount of the Value
• $81,000.

• Amount of Business Related to Payment
• $1,250,218.

• Intermediary
• None

• Citizenship of Parent Entity
• United States

• Total Sanction
• $ 518,470

• Compliance Monitor
• No

• Reporting Requirements
• No

• Case is Pending?
• No

• Total Combined Monetary Sanction
• $ 518,470

Avery Dennison Corporation 

• Citation
• SEC v. Avery Dennison Corp., No. 1:09-cv-5493 (C.D. Cal. 2009); 

• Date Filed
• 08/09/2009

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Books-and-Records
  • Internal Controls

• Other Statutory Provision
• None

• Disposition
• Cease-and-Desist Order, Complaint and Consent Order

• Defendant Jurisdictional Basis
• Issuer

• Defendant's Citizenship
• United States