United States v. Alcatel Lucent, S.A. (S.D. Fla. 2010)
United States v. Alcatel Lucent France, S.A., Alcatel Lucent Trade Int’l, A.G., and Alcatel Centroamerica, S.A (S.D. Fla. 2010)

• Case Name
• United States v. Alcatel Lucent, S.A. (S.D. Fla. 2010)
  United States v. Alcatel Lucent France, S.A., Alcatel Lucent Trade Int’l, A.G., and Alcatel Centroamerica, S.A (S.D. Fla. 2010)

• Date Filed
• 12/27/2010

• Enforcement Agency
• DOJ

• Countries
• Costa Rica, Honduras, Malaysia, Taiwan, Kenya, Nigeria, Bangladesh, Ecuador, Nicaragua, Angola, Ivory Coast, Uganda, Mali

• Foreign Official
• Officials of state-owned entities and government agencies including, but not limited to, Instituto Costarricense de Electricidad S.A. (Costa Rica); Empresa Hondureña de Telecomunicaciones (Honduras); Comisión Nacional de Telecomunicaciones (Honduras); Telekom Malaysia Berhad (Malaysia); and Taiwan Railway Administration (Taiwan).  Taiwanese legislators.

• Date of Conduct
• 2001 to 2006

• Nature of Business
• Alcatel-Lucent, S.A. (“Alcatel-Lucent”) is a French-based provider of telecommunications equipment and services and other technology products.  It was created after the merger of Alcatel, S.A. (a French corporation) and Lucent Technologies, Inc. (a U.S. corporation) in 2006.  Alcatel-Lucent France, S.A. is a wholly-owned subsidiary of Alcatel-Lucent, incorporated in France; Alcatel-Lucent Trade International, A.G. is a wholly-owned subsidiary of Alcatel-Lucent, incorporated in Switzerland; and Alcatel Centroamerica, S.A. is a wholly-owned subsidiary of Alcatel-Lucent, incorporated in Costa Rica.  The charged conduct took place prior to the merger, during which time each of these companies was a subsidiary of Alcatel, S.A.

• Influence to be Obtained
• Between 2001 and 2006, Alcatel, S.A. and its subsidiaries (collectively, “Alcatel”) made payments to government officials and state-owned company executives, through local consultants, to obtain lucrative telecommunications contracts.  In Costa Rica, Honduras, Malaysia, and Taiwan, Alcatel hired unqualified, but well-connected, consultants; paid for gifts and non-business travel for government officials; and made improper payments in exchange for nonpublic information regarding tenders.  Alcatel also paid inflated consultant commission rates and approved consultant payments for little to no work, with the understanding that part or all of the funds would go to government officials.  Through these illicit payments and gifts, Alcatel was able to procure and retain several major contracts, reaping more than $28,873,300 in profits.
   
  Alcatel also entered into several suspicious consulting agreements, with a high probability that some or all of the fees would be passed on to government officials, in Kenya, Nigeria, Bangladesh, Ecuador, Nicaragua, Angola, Ivory Coast, Uganda, and Mali. 
   

• Enforcement
• On December 27, 2010, the government filed a criminal information charging Alcatel-Lucent with one count of violating the internal control provisions of the FCPA and one count of violating the books-and-records provisions of the FCPA.  On the same day, the government filed a criminal information charging Alcatel-Lucent France, S.A., Alcatel-Lucent Trade International, A.G., and Alcatel Centroamerica, S.A. with conspiring to violate the anti-bribery, books-and-records, and internal controls provisions of the FCPA.  Each of the three subsidiaries entered into plea agreements under which each entity agreed to pay a fine of $500,000 and a special assessment fee of $400, commit no further crimes and work with Alcatel-Lucent in fulfilling compliance obligations.  Under a three-year deferred prosecution agreement, signed on December 20, 2010, Alcatel-Lucent agreed to pay a $92 million penalty (with a deduction for the fines imposed on its wholly-owned subsidiaries), continue to implement a compliance and ethics program, review its internal controls, policies and procedures, and retain a compliance monitor for a three-year term.
   
  On December 29, 2010, Alcatel-Lucent settled related charges with the SEC.
   
  On May 9, 2011, the Instituto Costarricense de Electricidad (“ICE”) filed in the United States District Court for the Southern District of Florida a request to find the company a victim of the criminal conduct alleged by the DOJ, to reject the plea agreements and the Deferred Prosecution Agreements, to order restitution as part of the sentence against Alcatel-Lucent and its subsidiaries, and to enter a sentence that is commensurate with and reflective of the severity of the criminal activities of Alcatel-Lucent and its subsidiaries.
   
  On June 6, 2011, the Court rejected the claim by ICE, and accepted the settlement between the DOJ and Alcatel-Lucent.  
   
  Subsequently, ICE appealed through a writ of mandamus to the 11th Circuit, but the appeal was dismissed for lack of jurisdiction.  On December 10, 2012, the United States Supreme Court denied ICE’s petition for writ of certiorari.
   

• Amount of the Value
• Over $9.8 million.

• Amount of Business Related to Payment
• Over $454.7 million.

• Intermediary
• Consultants; Local Subsidiaries.

• Total Sanction
• $ 93,501,200

• Compliance Monitor
• No

• Reporting Requirements
• No

• Case is Pending?
• No

• Total Combined Monetary Sanction
• $ 138,873,200

• Related Enforcement Actions
• SEC v. Alcatel Lucent, S.A. (S.D. Fla. 2010)
  United States v. Christian Sapsizian and Edgar Valverde Acosta (S.D. Fla. 2006)
  SEC v. Lucent Technologies Inc. (D.D.C. 2007)
  SEC v. Alcatel Lucent, S.A. (S.D. Fla. 2010)
  

Alcatel Lucent, S.A.

• Citation
• United States v. Alcatel-Lucent, S.A., No. 10-cr-20907 (S.D. Fla. 2010); 

• Date Filed
• 12/27/2010

• Filed Under Seal
• No

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

• Other Statutory Provision
• None

• Disposition
• Deferred Prosecution Agreement

• Defendant Jurisdictional Basis
• Issuer

• Defendant's Citizenship
• France

Alcatel Lucent France, S.A.

• Citation
• United States v. Alcatel-Lucent France, S.A., et al., No. 10-cr-20906 (S.D. Fla. 2010).

• Date Filed
• 12/27/2010

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Conspiracy

• Other Statutory Provision
• None

• Disposition
• Deferred Prosecution Agreement

• Defendant Jurisdictional Basis
• Territorial Jurisdiction

S.A., Alcatel Lucent Trade Int’l

• Citation
• United States v. Alcatel-Lucent France, S.A., et al., No. 10-cr-20906 (S.D. Fla. 2010).

• Date Filed
• 12/27/2010

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Conspiracy

• Other Statutory Provision
• None

• Disposition
• Plea Agreement

• Defendant Jurisdictional Basis
• Territorial Jurisdiction

• Defendant's Citizenship
• Switzerland

Alcatel Centroamerica, S.A

• Citation
• United States v. Alcatel-Lucent France, S.A., et al., No. 10-cr-20906 (S.D. Fla. 2010).

• Date Filed
• 12/27/2010

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Conspiracy

• Other Statutory Provision
• None

• Disposition
• Plea Agreement, Plea Agreement

• Defendant Jurisdictional Basis
• Territorial Jurisdiction, Conspiracy

• Defendant's Citizenship
• Costa Rica