McLean, a former vice president of International Harvester’s international division, was charged with violation of the Foreign Corrupt Practices Act (FCPA). Harvester pleaded guilty and admitted that the government had adequate evidence that two of its employees had aided and abetted violations of the FCPA. McLean believed that Harvester’s plea negotiations and guilty plea implicated him in the bribery scheme, making him a scapegoat. 

At the trial, all the substantive counts against him were dismissed because of a rule providing that an employee could not be convicted of violating the FCPA unless his employer was also convicted. (This rule was later repealed by the 1988 amendments to the FCPA.) McLean was then tried and acquitted of conspiring to violate the FCPA. He requested indemnification of $158,000 in legal fees and expenses incurred in defending himself. Harvester claimed that McLean waived any right to indemnification because he refused the services of the attorney that Harvester offered him. Must Harvester indemnify McLean for his legal fees?