L.A. film producers to stand trial in bribery case

LOS ANGELES — Before film producers Gerald and Patricia Green took over a movie festival in Bangkok, the weeklong event struggled to capture Hollywood's attention.

Over the next four years, the Southern California couple transformed the festival into a rising star on the international circuit for screening new films, attracting the likes of Michael Douglas, Jeremy Irons and director Oliver Stone to Thailand.

The success earned the couple a small fortune and drew scrutiny from federal prosecutors who have charged them with bribing Thai officials to run the festival and land lucrative contracts.

In a novel trial scheduled to start Tuesday in U.S. District Court, prosecutors allege the couple pocketed $14 million over a four-year period. The trial is the first in which entertainment industry figures are charged under the Foreign Corrupt Practices Act, a federal statute prohibiting corrupt payments to foreign officials for business purposes.

Gerald Green, who produced Stone's "Salvador" and the Christian Bale-led "Rescue Dawn," faces 20 counts. Patricia Green, who produced "Diamonds," a comedy starring Kirk Douglas, Dan Aykroyd and Lauren Bacall, faces 21 counts.

If convicted, they each could receive up to life in prison. They have both pleaded not guilty to the charges and are free on bond.

The outcome of the trial coupled with recent comments by federal officials could have an affect on how Hollywood studios conduct business in foreign countries. Earlier this month, Robert Khuzami, head of the Securities and Exchange Commission's enforcement division, said the agency will create a unit that will focus on possible foreign corruption violations.

"I think a message is being sent loud and clear that the government is going after violators no matter what industry they are in," said Franceska Schroeder, an attorney in Washington, D.C., who specializes in trade compliance law. "Even if you are in the entertainment industry, you have to be mindful of payments government officials are asking you to make."

The number of foreign corrupt practices cases the U.S. government has prosecuted has risen in the past several years. In 2003, there were only three; last year there were 17, according to the Department of Justice. So far, this year there have been nine cases.