When Should Corporations Disclose Regulatory Enforcement?

A Delaware judge dismissed a lawsuit on May 16 by Wal-Mart Stores Inc. shareholders who had alleged the corporation's management had covered up and failed to properly investigate bribes paid by executives in Mexico, finding that an earlier dismissal by an Arkansas judge into the same allegations precluded the Delaware case from going forward.

The dismissal ended litigation stemming from a 2012 New York Times article alleging Wal-Mart had shut down an internal probe and failed to notify U.S. or Mexican authorities after its initial investigation found evidence of suspect payments totaling more than $24 million. The CEO of Wal-Mart's Mexican subsidiary had allegedly authorized bribes to quickly secure construction permits, zoning approvals and licenses with the goal of expanding before competitors could react.