Terra Telecommunications Executives Petition Supreme Court

Terra Telecommunications

On August 14, two former Terra Telecommunications Corp. executives convicted of FCPA and related offenses petitioned the U.S. Supreme Court for certiorari review of the U.S. Court of Appeals for the Eleventh Circuit's definition of "instrumentality" under the FCPA.  In May, the Eleventh Circuit upheld the former executives' conviction under the FCPA and defined "instrumentality" as "an entity controlled by the government of a foreign country that performs a function the controlling government treats as its own."  As a consequence of this definition, the Eleventh Circuit deemed an employee of a partially state-owned Haitian telephone company to be a "foreign official" for purposes of the FCPA.  In asking for certiorari review and in citing reasons to grant the petition, the former executives focused on the absence of a definition of "instrumentality" of a foreign government within the FCPA, which, according to petitioners, has resulted in persistent questions about the correct interpretation of the term.  The petitioners faulted the Eleventh Circuit for applying "an unacceptably broad interpretation of the term 'instrumentality' that expands the reach of" the FCPA.   In so doing, the former executives described the Eleventh Circuit's reasoning as "illogic[al]" and under "its statutory construction, a janitor working for U.S. Government-subsidized General Motors could qualify as a 'foreign official' if General Motors were located overseas."  According to published reports, this is believed to be the first substantive FCPA cert petition in the history of the FCPA.  In addition, the Supreme Court has never substantively addressed any FCPA issue.