Executive John O'Shea Acquitted in 12-Count FCPA Case, According to Berg & Androphy

HOUSTON, Jan. 17, 2012 /PRNewswire/ -- A defense team from Berg & Androphy won exoneration of a U.S. executive accused of Foreign Corrupt Practices Act (FCPA) violations and a cover-up of payments made to officials of a Mexican state-owned electric utility, the law firm announced today after a trial in Houston federal court.

Late Monday, U.S. District Judge Lynn N. Hughes granted a defense motion for acquittal of John O'Shea, the former general manager of Sugar Land, Texas-based ABB Inc., finding Mr. O'Shea not guilty of all substantive FCPA charges. The motion was granted at the closing of the federal prosecutors' case and the jury was dismissed.

The Government had accused Mr. O'Shea of authorizing corrupt payments to officials of Comision Federal de Electridad (CFE) through a Mexican sales agent, Esimex, in exchange for an ABB contract to provide utility products and services.

Partners Joel M. Androphy and Sarah M. Frazier and associate Ashley Gargour of Berg & Androphy's Houston office represent Mr. O'Shea.

In announcing his ruling, Judge Hughes said he found that the Government's chief witness, an Esimex principal awaiting sentencing on conspiracy charges, could not tie Mr. O'Shea to the alleged crimes. The judge found that O'Shea's conduct, including efforts to renew an ABB-Esimex contract, was reasonably explained by lawful motives.

The Court also expressed concern that the Government had granted immunity to Esimex's founder, Fernando Basurto, Sr., allowing him to disclose selective information to the Government, while refusing to grant immunity to an important defense witness even six to seven years after the facts at issue. Basurto Sr. did not testify; the Government relied instead on his son's testimony.

Joel M. Androphy said, "Deflecting blame for bribery in corruption-ridden countries onto unknowing business executives is both Cervantian and unfair. My hope is that our victory for Mr. O'Shea will encourage others wrongfully accused under the FCPA to fight the charges against them."

Sarah M. Frazier added, "We were prepared to try this case to verdict and show the public through expert testimony and Mr. O'Shea's own testimony that these charges were unfounded and that he is an honest man caught up in a terrible situation."

Ashley Gargour concluded, "Justice was served with this acquittal of Mr. O'Shea. A married father of two daughters and a recent grandfather, John has had an exemplary career for more than 35 years as an engineer, manager, and businessman specializing in computer systems that run electricity grids and other sophisticated infrastructure."

The prosecution arose out of an ABB contract to create a "smart grid" for Mexico's aging electricity transmission infrastructure.

In September 2010, the DOJ announced that Switzerland-based ABB Ltd., and two subsidiaries paid $58 million in criminal and civil penalties, disgorgement and interest, and that ABB Inc. pleaded guilty to two FCPA counts.

The case is "U.S. v. John Joseph O'Shea," No. H:09-cr-629, in the U.S. District Court for the Southern District of Texas, Houston Division.

About Berg & Androphy

The attorneys at Berg & Androphy focus on complex commercial litigation (plaintiff and defendant), qui tam litigation and white-collar criminal defense. Based in Houston, the firm has offices in Washington, D.C., Denver, New York and Philadelphia. Androphy is author of the six-volume "White Collar Crime: Civil and Criminal Practice Treatise" (West) and was recognized as "Best Civil Attorney" by the Houston Press in 2009. Frazier is a three-time Texas Monthly "Texas Rising Star," as voted by her peers in the state legal community.

Attorney Contacts: Joel M. Androphy and Sarah M. Frazier, Berg & Androphy, Houston, 713.529.5622.

Media Contact: Erin Powers, Powers MediaWorks LLC, for Berg & Androphy, 281.703.6000, [email protected].

SOURCE Berg & Androphy