Answer: The matter was dismissed on procedural grounds.

On 23 July 2018, the U.S. District Court for the Eastern District of Kentucky—home to wire and cable manufacturer General Cable—granted the company’s motion to dismiss the putative class action filed against it on behalf of its employee-investors. The plaintiff had alleged that the company and its directors had violated their fiduciary duties by permitting company stock to be used as an investment vehicle for its retirement plan despite their knowledge (or what should have been their knowledge) that certain of its foreign subsidiaries had engaged in bribery of public officials. The company previously settled the purported FCPA violations with the DOJ and the SEC in 2016, submitting to penalties of more than USD 75 million . In resolving the employee’s claims, the court held that the complaint failed to meet the stringent pleading standard for breach-of-prudence claims based on non-public information, which requires plausible specification of an alternative course of action that a reasonable fiduciary would have pursued. The plaintiff alleged that the company should have made earlier disclosure of the FCPA violations, that it should have held participants’ contributions in cash or frozen further stock purchases once the bribery scheme became evident, or that its directors should have resigned. The court viewed these proposals as either implausible and potentially harmful alternatives, or as outright conclusory, and therefore insufficient to meet the applicable heightened pleading standard.