Celebrating Summer with Recent Wins in the White-Collar World

In the past few months, there have been several big wins for white-collar defendants.  Because we’re in desperate need for some good news as of late, here are highlights of those victories.

As I’ve pointed out before, DOJ doesn’t publicize its losses, so it’s sometimes hard to learn about these wins for the defense bar. Feel free to send your wins my way, and I’m happy to talk about them here.

 The Wynn Casino Deal

After a three-week trial, it took a federal jury about six hours to return a not guilty verdict for Charles Lightbody and two co-defendants.  The government had accused them of trying to cover up Mr. Lightbody’s part ownership of FBT Realty Company.  FBT sold land located right outside of Boston to Wynn Resorts, which is building a casino there.

The government argued that the scheme to hide Mr. Lightbody’s involvement in FBT was hatched to ensure that Wynn Resorts wouldn’t back out of the deal, as Mr. Lightbody has a “checkered past,” including supposed connections with the Mafia. Arguably, Wynn Resorts would have been concerned about how Mr. Lightbody’s involvement would look to the Massachusetts Gaming Commission.

The prosecution alleged that the defendants tried to make it appear that Mr. Lightbody had sold his interest in an exchange for a promissory note right before the group reached a deal with Wynn Resorts.

Mr. Lightbody’s defense lawyers argued that this was simply not the case and that he had transferred his interest in the company months before the deal was reached. Further, the defense argued that there was no law preventing Mr. Lightbody from benefiting from the deal, so there was really no motive to perpetrate that sort of fraud. The jury clearly agreed.

This seems like one of those cases where DOJ is bringing a criminal case based on a commercial transaction gone bad.

You can read more about the decision here.

The First Potential Casualty of the Yates Memo Survives

I wrote about Carl Reichel, the former President of Warner Chilcott, back in October, as his indictment gave him the dubious honor of being perhaps the first casualty of the Yates Memo.

A federal jury acquitted Mr. Reichel of one count of conspiracy to violate the federal anti-kickback statute. The government claimed that sales representatives at Warner Chilcott were bribing doctors in exchange for prescribing more of the company’s drugs.

At trial, the prosecution alleged that the aggressive sales environment at Warner Chilcott amounted to a criminal conspiracy led by Mr. Reichel.  While the government offered a lot of evidence at trial about the company’s culture, it apparently had little evidence actually linking Mr. Reichel to the misconduct (which, by the way, is what you need to convict someone).

The defense successfully argued that the conduct of the employees was not at Mr. Reichel’s direction, but was the product of rogue management at a lower level.  This was a major win for those of us who fear the broadly reaching implications of the Yates Memo, and a good lesson for corporate executives not to fear trial.

FedEx Gets Yet Another Win

I wrote about FedEx’s partial win back in March, when the government’s drafting error in a tolling agreement resulted in the dismissal of several of the charges against the company.  In a stunning turn of events, the government dismissed all of the remaining charges against it mid-trial.

Yes, you read that right. DISMISSED ALL OF THE CHARGES.

FedEx was accused of colluding with online pharmacies to illegally ship prescriptions.  It was charged with fifteen counts of trafficking in controlled substances.  Two DEA agents were set to testify against the company regarding meeting that took place with FedEx officials. The investigation had been going on for many years since the indictment was handed down in mid-2014, and no doubt had been going on for some time before then.

The dismissal request was two pages long and did not disclose why prosecutors chose to drop the case. While I would love to know what prompted such a swift decision, a win is a win.

As Bernie would say, this is yuuuuuuuge.

This entry was posted in Acquittal After Jury Trial, Dismissal of charges in indictment, Health care fraud. Bookmark the permalink.

One Response to Celebrating Summer with Recent Wins in the White-Collar World

  1. Pingback: Another Big Win in the White Collar World (This Time in the EDVA, of All Places) | Grand Jury Target

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s