Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Business Crimes BulletinKickerFeaturesSectionsNewsLJN Newsletters

Indemnification Revisited

By Andrew P. Gaillard
August 18, 2003

A recent Wall Street Journal story asked, 'How much does it cost to defend a company and its executives when they are under investigation for accounting fraud?' In the case of Qwest Communications International, Inc., the Denver-based telephone company currently under parallel SEC and Department of Justice investigations, the answer is staggering. Over the course of the previous year, $75 million was expended on outside counsel. As 'legal pressures' continue to mount, the Journal reported that 'more than $7 million per month' in legal fees was anticipated. For the beleaguered company, there appears to be no end in sight. In late February, four former Qwest executives were indicted in what Attorney General Ashcroft described as the 'first phase' of the investigation.

If simple economics were not enough to motivate corporate counsel to take a fresh look at what their company's corporate documents say about indemnification, a recent pronouncement from the DOJ should. On January 20, 2003, the Deputy Attorney General issued a memorandum to all U.S. Attorney's offices entitled 'Principles of Federal Prosecution of Business Organizations.' In large measure, the memorandum restates a June 16, 1999 DOJ memorandum entitled 'Bringing Criminal Charges Against Corpor- ations.' Each of these memos sets forth guidelines and factors to be used by prosecutors in determining whether to charge a corporation or other business entity in a particular case.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Law Firms are Reducing Redundant Real Estate by Bringing Support Services Back to the Office Image

A trend analysis of the benefits and challenges of bringing back administrative, word processing and billing services to law offices.

Bankruptcy Sales: Finding a Diamond In the Rough Image

There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.

Bit Parts Image

Summary Judgment Denied Defendant in Declaratory Action by Producer of To Kill a Mockingbird Broadway Play Seeking Amateur Theatrical Rights

Risks of “Baseball Arbitration” in Resolving Real Estate Disputes Image

“Baseball arbitration” refers to the process used in Major League Baseball in which if an eligible player's representative and the club ownership cannot reach a compensation agreement through negotiation, each party enters a final submission and during a formal hearing each side — player and management — presents its case and then the designated panel of arbitrators chooses one of the salary bids with no other result being allowed. This method has become increasingly popular even beyond the sport of baseball.

Disconnect Between In-House and Outside Counsel Image

'Disconnect Between In-House and Outside Counsel is a continuation of the discussion of client expectations and the disconnect that often occurs. And although the outside attorneys should be pursuing how inside-counsel actually think, inside counsel should make an effort to impart this information without waiting to be asked.