The nation is slowly reopening. Businesses showcase signs that proudly announce “OPEN” in bright neon letters. But the legal landscape is different from the pre-COVID-19 days, and businesses should be aware of the inherent risks involved with re-opening and take the utmost care to ensure employee and customer safety to avoid or minimize government intrusion, investigation, and prosecution for running afoul of the post-COVID-19 legal landscape. Ohio started reopening in April of 2020, but Ohio’s…
On March 20, 2020, the Attorney General ordered the Department of Justice (“DOJ”) to prioritize oversight, investigation, and prosecution of misuse of federal funds distributed in response to the COVID-19 pandemic.[1] Now, almost six months later, the DOJ continues to examine instances of “COVID-19 Fraud” for possible civil or criminal prosecution. The DOJ’s prioritization of such investigations is of significant concern to any business or entity that received federal funds from any COVID-19 federal…
Late last week, the Department of Justice (DOJ) issued a Foreign Corrupt Practices Act (FCPA) Opinion 20-1, its first such opinion in almost six years.  In the Opinion, the DOJ advised a U.S.-based investment advisor that the DOJ did not intend to take any enforcement action related to the payment of certain fees to a foreign investment bank indirectly owned by a foreign government.  Unfortunately, the Opinion offers little insight into DOJ’s FCPA enforcement priorities. The…
On Tuesday July 28, Eastman Kodak, Co. in conjunction with the Trump Administration publicly announced that Kodak would receive a $765 million loan for purposes of manufacturing generic drug ingredients. Just a few days later, Senator Elizabeth Warren (D-Mass.) penned a letter to Securities and Exchange Commission Chairman Jay Clayton demanding an investigation into the timing of Kodak’s announcement, suspicious trading activity that preceded announcement, and the timing of certain trades by Kodak executives and…
The federal government has been handing out billions of dollars in stimulus money to individuals and companies. These funds have helped businesses survive the COVID-19 pandemic by providing them with low or no-cost liquidity when they are not permitted to operate as they would normally. But stimulus money, like all government money, is a double-edged sword. By applying for and accepting these funds, businesses are subjecting themselves to the specter of liability under the False…
On July 2, 2020, a federal judge sitting in Manhattan sentenced disgraced entrepreneur Telemaque Lavidas to a year and a day in prison for insider trading. In addition to the prison term, the judge sentenced Lavidas to three years of supervised release including community service, restitution, and fines, which together could exceed $200,000. Lavidas’s conviction arose from passing secrets that he learned from his father, who sat on Ariad’s Board of Directors, to a stock…
Whether attributable to the pandemic effect of remote work, layoffs and furloughs, or the slew of recent substantial awards, the SEC’s whistleblower tip line is lighting up with greater frequency. Companies are understandably focused on the panoply of challenges to their businesses posed by the pandemic and its economic impacts, but they ignore heightened whistleblower risks at their peril. Since April 1 of this year, the SEC has announced five large awards in rapid-fire succession…
Various federal agencies – particularly the FBI and the DOJ – have been vocal in announcing efforts to ferret out fraud and other criminal activity arising out of the COVID-19 pandemic. As described in prior blog posts on this site (here and here), the government focused on pandemic profiteering, such as price gouging and hoarding of PPE. Now, as the initial shock has dissipated somewhat, and after distributing hundreds of billions of stimulus…
With the COVID-19 pandemic sweeping the U.S., nursing homes have been ground zero for infections and deaths. According to new data released by the Centers for Medicare & Medicaid Services (“CMS”), there were 29,457 U.S. nursing home deaths from COVID-19 through the first week of June 2020. With COVID-19, the criminal enforcement landscape for nursing homes has drastically changed in just a few months. Here are our predictions for the coming months of enforcement and…
On June 15, 2020, the Food and Drug Administration (FDA) withdrew its emergency use authorization (EUA) to use hydroxychloroquine to treat COVID-19. According to the FDA, there is “no reason to believe” the drug is effective against the coronavirus, and its use increased the risk of serious side effects, such as heart problems. The FDA’s action is a stunning about-face. There are now serious questions about how state and federal regulators and enforcement agencies will…