Halliburton 2015 Annual Report Download - page 80

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In September 2007, the Fund filed a motion for class certification, and our response was filed in November 2007. The
district court issued an order in November 2008 denying the motion for class certification. The Fifth Circuit Court of Appeals
affirmed the district court’s order denying class certification. In June 2011, the United States Supreme Court reversed the Fifth
Circuit ruling that the Fund needed to prove loss causation in order to obtain class certification and the case was returned to the
lower courts for further consideration.
In January 2012, the district court issued an order certifying the class. In April 2013, the Fifth Circuit issued an order
affirming the district court's order.
Our writ of certiorari with the United States Supreme Court was granted and in June 2014 the Supreme Court issued
its decision, maintaining the presumption of class member reliance through the “fraud on the market” theory, but holding that
we are entitled to rebut that presumption by presenting evidence that there was no impact on our stock price from the alleged
misrepresentation. Because the district court and the Fifth Circuit denied us that opportunity, the Supreme Court vacated the
Fifth Circuit’s decision and remanded for further proceedings consistent with the Supreme Court decision.
In December 2014, the district court held a hearing to consider whether there was an impact on our stock price from
the alleged misrepresentations. On July 27, 2015, the district court denied certification for the plaintiff class with respect to five
of the six dates upon which the plaintiffs claimed that disclosures correcting previously misleading statements had been made
that resulted in an impact to the stock price. However, the district court certified the class with respect to a disclosure made on
December 7, 2001 regarding an adverse jury verdict in an asbestos case that plaintiffs alleged was corrective, leaving the
allegation relating to disclosure of the asbestos liability exposure as the only remaining punitive class action claim. The ruling
was based on the district court's conclusion that the court was required to assume at class certification that a disclosure was
actually corrective. We do not agree with that conclusion and filed a petition with the Fifth Circuit seeking to appeal the ruling.
On November 4, 2015, the Fifth Circuit granted our petition to appeal the district court's ruling. The case will now be fully
briefed and argued before the Fifth Circuit. We cannot predict the outcome or consequences of this case, which we intend to
vigorously defend.
Investigations
We are conducting internal investigations of certain areas of our operations in Angola and Iraq, focusing on
compliance with certain company policies, including our Code of Business Conduct (COBC), and the FCPA and other
applicable laws.
In December 2010, we received an anonymous e-mail alleging that certain current and former personnel violated our
COBC and the FCPA, principally through the use of an Angolan vendor. The e-mail also alleges conflicts of interest, self-
dealing, and the failure to act on alleged violations of our COBC and the FCPA. We contacted the DOJ to advise them that we
were initiating an internal investigation.
During the second quarter of 2012, in connection with a meeting with the DOJ and the SEC regarding the above
investigation, we advised the DOJ and the SEC that we were initiating unrelated, internal investigations into payments made to
a third-party agent relating to certain customs matters in Angola and to third-party agents relating to certain customs and visa
matters in Iraq.
Since the initiation of the investigations described above, we have participated in meetings with the DOJ and the SEC
to brief them on the status of the investigations and produced documents to them both voluntarily and as a result of SEC
subpoenas to us and certain of our current and former officers and employees.
We expect to continue to have discussions with the DOJ and the SEC regarding issues relevant to the Angola and Iraq
matters described above. We have engaged outside counsel and independent forensic accountants to assist us with these
investigations.
Because these investigations are ongoing, we cannot predict their outcome or the consequences thereof.
Environmental
We are subject to numerous environmental, legal, and regulatory requirements related to our operations worldwide. In
the United States, these laws and regulations include, among others:
- the Comprehensive Environmental Response, Compensation, and Liability Act;
- the Resource Conservation and Recovery Act;
- the Clean Air Act;
- the Federal Water Pollution Control Act;
- the Toxic Substances Control Act; and
- the Oil Pollution Act.
In addition to the federal laws and regulations, states and other countries where we do business often have numerous
environmental, legal, and regulatory requirements by which we must abide. We evaluate and address the environmental impact
of our operations by assessing and remediating contaminated properties in order to avoid future liabilities and comply with
environmental, legal, and regulatory requirements. Our Health, Safety, and Environment group has several programs in place to
maintain environmental leadership and to help prevent the occurrence of environmental contamination. On occasion, in
addition to the matters relating to the Macondo well incident described above, we are involved in other environmental litigation
and claims, including the remediation of properties we own or have operated, as well as efforts to meet or correct compliance-