Be Careful What You Wish For

Unjustifiable Clauses

While most DPAs contain an assortment of standard clauses ' requiring that the corporation pay fines and restitution, cooperate with investigators, and implement compliance programs, to name a few ' some DPAs now include extraordinary clauses that simply cannot be justified. In its June 2005 DPA, Bristol-Myers Squibb, in addition to agreeing to the normal comprehensive DPA provisions, was forced to endow a chair of corporate ethics at Seton Hall University Law School, the alma mater of the U.S. Attorney for the District of New Jersey, who signed the DPA for the government. In similar heavy-handed fashion, the Oklahoma Attorney General forced MCI to agree in a DPA to create 1600 new jobs within the state over a ten-year period as a requirement for allowing the company to avoid prosecution. Tactics like these have led one legal commentator to question whether this seemingly unchecked power has left companies 'vulnerable to the extortionate demands of even well-meaning prosecutors,' who 'may be tempted to experiment with corporate governance in ways that exceed their competence or entitlement.' See John C. Coffee, Jr., Deferred Prosecution: Has It Gone Too Far?, Nat'l L. J., Vol. 27, No. 25, July 25, 2005, at 13. Although requiring corporations to agree to a statement of facts may not seem as drastic as the examples above, this facet of a DPA has the potential to cause a company much greater harm. Therefore, a company must carefully weigh the risks and benefits of entering into such an agreement.