United States v. Robert E. Thompson and James C. Reilly (N.D. Ala. 2005)

• Case Name
• United States v. Robert E. Thompson and James C. Reilly (N.D. Ala. 2005)

• Date Filed
• 07/01/2004

• Enforcement Agency
• DOJ

• Countries
• Saudi Arabia

• Foreign Official
• The Director General of a Saudi Arabian Foundation.

• Date of Conduct
• 2000 to 2002

• Nature of Business
• Provision of hospital staffing and management services by HealthSouth, a U.S. corporation.  Robert Thompson is the former president and COO of HealthSouth Corporation’s In-Patient Division.  James Reilly is the former HealthSouth Group’s vice president of legal services.

• Influence to be Obtained
• This action related to HealthSouth’s (successful) efforts to secure a contract for staffing and management services for a 450-bed hospital in Saudi Arabia.  The DOJ alleged that the Director General of a Saudi Arabian foundation responsible for the hospital solicited a $1 million “finder’s fee” from HealthSouth, and that HealthSouth, against the advice of counsel, agreed to pay the Director General $500,000 per year for five years.  The payments were made via a consulting contract between the Director General and an Australian HealthSouth affiliate.

• Enforcement
• The DOJ first filed non-FCPA charges against two other HealthSouth employees in connection with these allegations:  former Vice President Vincent Nico and former Executive Vice President Thomas Carman.  Nico pled guilty to wire fraud on April 22, 2004, and agreed to forfeit $1,005,602 of ill-gotten gains relating to this scheme.  On April 27, 2004, Carman admitted to making a false statement to the FBI.  Both then began to cooperate with the DOJ’s investigation.
   
  Messrs. Thompson and Reilly were indicted under the Travel Act and the books-and-records provisions of the FCPA on July 1, 2004.  After trial, the jury found both Thompson and Reilly not guilty on May 20, 2005.
   

• Amount of the Value
• $2.5 million.

• Amount of Business Related to Payment
• $50 million.

• Intermediary
• HealthSouth Affiliate in Australia.

• Total Sanction
• $ 0

• Compliance Monitor
• No

• Reporting Requirements
• No

• Case is Pending?
• No

Robert E. Thompson 

• Citation
• United States v. Thompson, No. 2:04-cr-00240 (N.D. Ala. 2004).

• Date Filed
• 07/01/2004

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Books-and-Records
  • Conspiracy: Books-and-Records

• Other Statutory Provision
• Conspiracy (Travel Act); Travel Act.

• Disposition
• Charges Dismissed

• Defendant Jurisdictional Basis
• Conspiracy, Agent of Issuer

• Defendant's Citizenship
• United States

• Individual Sanction
• None

James C. Reilly

• Citation
• United States v. Thompson, No. 2:04-cr-00240 (N.D. Ala. 2004).

• Date Filed
• 07/01/2004

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Books-and-Records
  • Conspiracy: Books-and-Records

• Other Statutory Provision
• Conspiracy (Travel Act); Travel Act.

• Disposition
• Charges Dismissed

• Defendant Jurisdictional Basis
• Conspiracy, Agent of Issuer

• Defendant's Citizenship
• United States

• Individual Sanction
• None