Judge William Pauley
Taiwan resident Liu was a compliance officer for the healthcare division of Siemens A.G.’s Chinese subsidiary Siemens China Ltd. Under the Anti-Retaliation Provision of the Dodd-Frank Act, Liu alleged Siemens China routinely inflated bids to sell equipment to hospitals in China and North Korea. He alleged adverse actions—culminating with his being ordered not to return to work for the last three months of his employment contract—after raising concerns that a deal with North Korea circumvented internal compliance procedures instituted after Siemens A.G.’s 2008 guilty plea to a Foreign Corrupt Practices Act (FCPA) charge. On May 17, 2011, Liu reported possible FCPA violations to the SEC. The court dismissed Liu’s complaint with prejudice, finding no indication that Congress intended for the Anti-Retaliation Provision to apply extraterritorially. Dodd-Frank’s extraterritorial applications, particularly §929P9(b)—permitting SEC enforcement actions for certain conduct or transactions outside the United States—reinforce the conclusion that the Anti-Retaliation Provision is a purely domestic concern. Further, FCPA violations are beyond the scope of §806 of the Sarbanes-Oxley Act.
