Monday, August 20, 2012

Wal-Mart Stores, Inc.(NYSE:WMT) Sued by Shareholder for Access to Documents about Bribery

An undercover allegation has been in place for a while that a Wal-Mart Stores, Inc.(NYSE:WMT) subsidiary had bribed Mexican government officials. But an Indiana union pension fund that has some money invested in shares in Wal-Mart Stores Inc. has slapped a lawsuit so that it can confiscate those documents that are related to bribery allegations.

The New York Times had printed a report in April that Wal-Mart was suspecting its Mexican chain called Wal-Mart de Mexico, of bribing government officials to gain store permits. An internal investigation was being carried out as well. Investors saw red when they read the Times’ article and immediately sued Wal-Mart and its board of directors in Delaware's Court of Chancery.

The lawsuit filed by the Indiana union pension fund, states that Wal-Mart had failed to produce relevant documents earlier as per the demand of an out-of-court settlement. The documents produced by the company were heavily redacted or blacked out and totally useless. The pension fund spokesperson has said that Wal-Mart is using excessive redactions in an unjustified manner.

An unknown informer had mailed statements to the fund’s attorneys related to facts in the Times’ article about bribes paid by Wal-Mart de Mexico. The documents by the so-called whistleblower include mails exchanged by people who were a part of the internal investigation. Wal-Mart officials have refused to comment on this issue. They will only provide information to the U.S. Department of Justice and the Securities and Exchange Commission.

Theodore Boutrous, a lawyer for Wal-Mart has said that the company is in the process of producing documents to defend itself and tackle the complaint in its own way. Apparently, the documents produced earlier had almost half the pages blacked out, according to the Indiana fund, which is the pension fund for the local arm of the International Brotherhood of Electrical Workers. The lawsuit will impose an order on Wal-Mart to allow unrestricted access of the required records and documents.

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