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Expect more international business investigations to be shared between government enforcers, warned Linda Chatman Thomsen, head of enforcement for the U.S. Securities & Exchange Commission. Thomsen was addressing lawyers and judges at the annual Judicial Conference of the 9th U.S. Circuit Court of Appeals Thursday as part of a panel session on the dilemmas of international law and policy. “In recent years we have gone from information sharing internationally to parallel investigations,” she said. “Now we are headed to a process of different jurisdictions taking different pieces of the same investigations,” she said. “A complete solution [to international enforcement] will require coordinated investigation.” The United States has made the majority of international requests for information, with 550 each in 2006 and 2007, according to Thomsen. By contrast, international requests for material in ongoing investigations outside the United States rose from 350 in 2006 to 450 last year, she said. International cooperation can have a downside, said Alejandro Mayorkas, attorney with O’Melveny & Myers and former U.S. attorney in Los Angeles. During an Italian prosecution of an alleged co-conspirator in a four-year corruption probe of Italian Prime Minister Silvio Berlusconi, prosecutors from Milan sought and received permission to search the Los Angeles home of the co-defendant. Six days before the Milan trial, Italian investigators, with local police, seized not only computers, but also trial preparation material protected by attorney-client privilege in the United States. Mayorkas said it was something that a U.S. prosecutor would never be permitted to do. When the U.S. authorities discovered what had been taken, they successfully brought a motion for return of the property. Differing legal standards and philosophies can hamstring not only investigations but also the ways corporations must respond internationally. Bruce Sewell, senior vice president and general counsel for Intel Corp., said that in some cases the strictest standards produce the most desired effects. He complained that international forum-shopping by plaintiffs lawyers will cluster cases in jurisdictions that provide the best law for them but with no international counterbalancing avenue for the defense to move to change forums. “I am worried about the long-term consequences of global forum-shopping,” he said. Thomsen said that while “systems of business have gone profoundly global, systems of law are profoundly local.” This disconnect between law and global economics creates a dilemma for companies such as global search engine, Google Inc., according to Kent Walker, vice president and general counsel for Google. The ability to share information without regard to borders presents extraordinary challenges, Walker said. His company has faced court challenges from France and Germany over access to Nazi memorabilia, and criticism for allowing the Chinese government to block parts of Internet to its citizens. Google also is dealing with political conflicts in Turkey, where Islamic politicians have argued that information insulting to any Turk worldwide must be removed entirely, not just blocked in Turkey. Sewell said the antitrust enforcers in the European Union have expressed the opinion that Microsoft Inc.‘s market share should be held at 50 percent, while the United States believes the market should decide market share. “If [governments] affect market share by forcing a company to license its intellectual property, but say it is only in the EU, how can you contain that?” he asked.

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