On Tuesday 16th July 2019, John Harrison QC of St Pauls Chambers, Dan Stowers of Shoosmiths and Henry Grunwald QC of Charter Chambers made legal history by securing the first-ever bribery acquittal following a DPA.
The client was Michael Sorby, former managing director of Sarclad Ltd, a Yorkshire-based steel tech company – part of the Heico Companies group. Along with two other former employees, ex-sales head Adrian Leek and former project manager David Justice, the client was accused of conspiring with various overseas sales agents to offer bribes to secure contracts for Sarclad to the tune of £17 million between 2004-2012.
A DPA was reached between the SFO and Sarclad Ltd in July 2016 following an investigation by Sarclad’s lawyers and the SFO. The investigation purported to uncover evidence of corruption and bribery concerning the systematic use of payments to secure contracts. Sarclad agreed to pay financial orders of over £6.5million to prevent an SFO prosecution under the terms of the DPA.
However, following a 10-week trial in Southwark Crown Court, on the 16th July 2019, Michael Sorby, Adrian Leek and David Justice were acquitted three years after the DPA was entered into. Mr. Sorby had been acquitted of bribery charges on the direction of the trial judge at the close of the prosecution case. The jury was not satisfied that the same evidence relied upon to agree the DPA proved any systematic use of payments to secure contracts by the individual defendants and acquitted all three defendants of the remaining charges. It follows that Sarclad Ltd and the SFO must have agreed a DPA on a misunderstanding of the evidence and/or following an incomplete investigation.
John Harrison QC of St Pauls Chambers said,
“The verdicts returned in Southwark have rightly received a great deal of media coverage reflecting their significance. Mr Sorby is the first managing director to be prosecuted and then found not guilty, following the conclusion of a DPA between the SFO and Sarclad. This is no time for a discussion of all the wider implications of the case but I thank Dan Stowers at Shoosmiths for my instructions in this case and all the hard work carried out by him and his team.”
Instructing Solicitor, Dan Stowers, the Shoosmiths partner said,
“The SFO was too ready to accept a version of events presented to them by the lawyers for Heico, rather than undertaking an independent investigation of their own. Their haste led to an unnecessary, misguided and unsuccessful prosecution. The investigation and, if necessary, prosecution of individuals should precede a DPA and not follow one”