Stephanie Albrecht, a senior associate in Orrick's Los Angeles office, focuses her practice on regulatory and internal investigations and complex litigation.
Stephanie has experience representing companies and individuals in SEC and DOJ investigations involving potential violations of the securities laws, the Foreign Corrupt Practices Act, the False Claims Act, consumer protection laws, and other federal and state laws. Stephanie also has extensive experience conducting internal investigations and representing clients in securities, trade secrets, employment, and other complex commercial litigation matters.
Additionally, Stephanie devotes her practice to pro bono work, representing clients in adoption, immigration, and civil rights matters.
Stephanie is a regular contributor to Orrick's Securities Litigation, Investigations and Enforcement blog and an Associate Editor of The World in US Courts: Orrick's Quarterly Review of Decisions Applying US Law to Global Business and Cross-Border Activities.
During law school, Stephanie was a law clerk in the Division of Enforcement at the U.S. Securities and Exchange Commission.
The SEC has signaled plans to double down on its FCPA enforcement efforts and speed up FCPA investigations. On November 9, 2017, Steven Peikin, Co-Director of the SEC’s Enforcement Division, delivered a speech at New York University School of Law to commemorate the 40th anniversary of the FCPA and the 20th anniversary of the Organisation for Economic Co-Operation and Development Anti-Bribery Convention. In his speech, Peikin stressed the importance of the FCPA to the Commission’s enforcement mission and noted that the Commission will continue its commitment to FCPA enforcement. Pointing out that the Commission has brought 106 FCPA-related actions against individuals and corporations since forming its designated FCPA Unit in 2010, Peikin highlighted the Commission’s success in fostering a more predictable and uniform approach to FCPA enforcement and domestic and international partnerships in fighting corruption.
Peikin stressed the importance of collaborating with international colleagues in the fight to “eradicate[e] corruption and bribery” and pointed to recent global settlements, including the settlement with Telia (reported here), as examples of successful cross-border coordination and cooperation. Citing deterrence and investigation efficiencies as key benefits of global coordination, Peikin noted that he expects “the trend of the Enforcement Division working closely with foreign law enforcement and regulators in anti-bribery actions to continue its upward trajectory in the coming years.” READ MORE
The Second Circuit recently considered the extraterritorial application of the U.S. securities laws in the private securities class action context, bringing some clarity to an area of the law that is increasingly important given the globalization of financial markets.
In re Petrobras Securities, 862 F.3d 250 (2nd Cir. 2017), was an appeal of a class certification order in a securities class action related to an alleged multi-year money-laundering and kickback scheme involving Petróleo Brasileiro S.A. (“Petrobras”), the Brazilian state-owned oil and gas company. The district court had certified two classes of investors who purchased Petrobras American Depository Shares (ADS) and debt securities, and who brought misrepresentation claims under the Securities Act of 1933 and the Securities Exchange Act of 1934 against Petrobras, its subsidiaries, and its underwriters. Morrison v. National Australia Bank Ltd., 561 U.S. 247 (2010), held that the anti-fraud provisions of the securities laws have no extraterritorial effect, and as a consequence apply only to transactions in securities that occur on a U.S.-based exchange or that are otherwise “domestic.” Petrobras ADS shares satisfied the first requirement, but the company’s debt securities are traded over-the-counter, not on a U.S. exchange. Prior decisions had limited “domestic” transactions to ones where (1) the purchaser “incurred irrevocable liability within the United States to take and pay for a security . . . or to deliver a security” or (2) “legal title to the security . . . transferred in the United States” (see, e.g., Absolute Activist Value Master Fund Ltd. v. Ficeto, 677 F.3d 60, 68 (2d Cir. 2012)), but how this test implicated the standards for class certification was not clear. READ MORE
After a five-week trial, a jury of five men and seven women convicted notorious pharmaceutical executive Martin Shkreli of securities fraud on August 4, 2017. Shkreli had been charged with two counts of securities fraud, three counts of conspiracy to commit securities fraud, and three counts of conspiracy to commit wire fraud for operating a sophisticated Ponzi scheme in which he looted the assets of his pharmaceutical company to pay off defrauded investors in his hedge funds. The jury convicted Shkreli of two counts of securities fraud and one count of conspiracy to commit securities fraud but acquitted him of five other counts, including the wire fraud charges.
Shkreli gained notoriety in 2015, when he was head of Turing Pharmaceuticals, for increasing the price of a life-saving drug from $13.50 to $750 per pill. However, Shkreli’s conviction stems from his time before Turing, when he managed two hedge funds, MSMB Capital Management and MSMB Healthcare Management. The government alleged that between 2009 and 2012, Shkreli induced investments of around $3 million from eight investors in MSMB Capital and $5 million from thirteen investors in MSMB Healthcare by misrepresenting key facts, including the funds’ performance and assets under management, and omitting key facts, such as significant trading losses at another fund Shkreli had previously managed. Shkreli allegedly also withdrew money from the funds for personal use and produced false performance reports touting profits as high as forty percent. MSMB Capital ceased trading after a series of trading losses in early 2011, and MSMB ceased operating in late 2012. In September 2012, Shkreli notified both funds’ investors that he was winding down the funds, that he had doubled their investments net of fees, and that investors could have their interests redeemed for cash, even though the funds had no money. At trial, Shkreli’s attorney argued that the hedge funds’ investors had not only received all of their money back but made significant profits. READ MORE
On May 24, 2017, the SEC for the first time brought charges based on allegations of insider trading on confidential government information. The alleged insider trading scheme involved tips related to three announcements by the Center for Medicare & Medicaid Services (“CMS”) regarding non-public rate changing decisions affecting the stock of issuers in the healthcare industry.
The complaint alleges that from May 2012 to November 2013, Christopher Worrall, a health insurance specialist in the Center for Medicare (“CM”), the CMS component that administers Medicare’s national payment systems and determines Medicare reimbursement rates, tipped his long-time friend David Blaszczak about internal deliberations and planned actions of CMS. Blaszczak is a consultant specializing in healthcare policy issues and a former CMS employee. READ MORE
On March 8, 2017, a divided panel of the Ninth Circuit issued an opinion in Somers v. Digital Realty Trust Inc. that further widened a circuit split on the issue of whether the anti-retaliation provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act apply to whistleblowers who claim retaliation after reporting internally or instead only to those who report information to the SEC. Following the Second Circuit’s 2015 decision in Berman v. [email protected] LLC, the Ninth Circuit panel held that Dodd-Frank protections apply to internal whistleblowers. By contrast, the Fifth Circuit considered this issue in its 2013 decision in Asadi v. G.E. Energy (USA), LLC and found that the Dodd-Frank anti-retaliation provisions unambiguously protect only those whistleblowers who report directly to the SEC.
Plaintiff Paul Somers alleged that Digital Realty Trust fired him after he made several reports to senior management regarding possible securities law violations. Somers only reported these possible violations internally at the company, and not to the SEC. After his employment was terminated, Somers sued Digital Realty, alleging violations of state and federal securities laws, including violations of the whistleblower protections under Dodd-Frank. Digital Realty moved to dismiss on the ground that Somers was not a “whistleblower” under Dodd-Frank. The district court denied the motion, deferring to the SEC’s interpretation that internal reporters are also protected from retaliation under Dodd-Frank.