On July 3, 2010, the Justice Yates (the trial judge) overturned his decision after a bench trial convicting William Gilman and Edward McNenny of violating the Donnolly Act (New York’s antitrust statute) for rigging bids on insurance contracts. According to the New York Times, he did so based on “newly discovered contradictory statements made by witnesses who cooperated with prosecutors, and the suppression of documents that would have been ‘invaluable’ to the defense.” Gilman and McNenny are the only Marsh executives that were convicted after a trial. As reported in earlier posts, Marsh paid an $850 million civil penalty and was not prosecuted. One former Marsh executive pleaded guilty and others had their cases voluntarily dismissed by the government or were acquitted after a bench trial.
Dec
10
Posted by : | On : December 10, 2009
On November 19, 2009, the New York Attorney General’s motion to dismiss the charges arising from alleged bid rigging of insurance policies against Thomas T. Green, Jr. and William L. Burnie (former Marsh executives) and Geri Mandel (a former Zurich executive) was granted by Justice James Yates. New York Attorney General Andrew Cuomo sought dismissal in light of the acquittals of Joseph Peiser, Greg Doherty and Kathleen Drake, former Marsh executives, after an 11-month bench trial before Justice Yates, who was to preside at the upcoming trial. These acquittals were reported in the October 26, 2009 Post. As you may recall (and discussed in the February 22, 2008 Post), two Marsh executives were convicted of Donnelly Act violations after a 10-month bench trial. These cases were brought by then New York Attorney General Elliot Spitzer. Marsh paid $850 million to settle and another Marsh executive pleaded guilty.
Oct
26
Posted by : | On : October 26, 2009
Joseph Peiser, Greg Doherty and Kathleen Drake, former Marsh executives, were acquitted after an 11-month bench trial before Justice James Yates of violating New York’s antitrust law — the Donnelly Act. They were acquitted of bid-rigging in connection with the sale of insurance policies. As you may recall (and discussed in the February 22, 2008 Post), two Marsh executives were convicted of Donnelly Act violations after a 10-month bench trial. These cases were brought by then New York Attorney General Elliot Spitzer. Marsh paid $850 million to settle and another Marsh executive pleaded guilty.
Dec
08
Posted by : | On : December 8, 2008
On December 2, 2008, three Marsh executives went on trial in the Supreme Court of the State of New York (New York County) on charges of violating the Donnelly Act in connection with bid rigging of insurance policies. As you may recall (and discussed on the February 22, 2008 Post), two Marsh executives were convicted on Donnelly Act violations after a 10 month trial. These cases have been brought by the New York Attorney General. Marsh paid $850 million to settle and another Marsh executive pleaded guilty.
Nov
30
Posted by : | On : November 30, 2008
In November 2008, the United States District Court for the District of Maryland sentenced two defense contractors to probation who had pleaded guilty in connection with a conspiracy to steal confidential bidding information from a competitor. The conspiracy concerned contracts to supply the Department of Defense with jet fuel abroad. In its press release announcing the guilty pleas (attached Cartwright Press Release), the Antitrust Division’s Criminal Section noted that the defendants pleaded guilty to offenses that had maximum prison sentences of 20 years — conspiracy to commit wire fraud by one defendant and conspiracy to commit wire fraud, defraud the United States and steal trade secrets by the other defendant. The court rejected the government’s requests for prison time. It noted that the defendants had otherwise been exemplary businessman and citizens and were pioneers in supplying fuel to newly opened routes in Eastern Europe. They were responsible for opening aviation from throughout the world in these far flung areas. The defendants were represented by Richard Levitt, Esq. of Levitt & Kaizer, Ray Granger, Esq. of Granger & Associates and Gordon Mehler, Esq. of Law Offices of Gordon Mehler.
Nov
16
Posted by : | On : November 16, 2008
On November 10, 2008, the DOJ Antitrust Division’s criminal section lost another high profile criminal price fixing trial. This time the individual defendant was acquitted of alleged participation in the highly publicized marine hose cartel that had resulted in numerous guilty pleas. After a two-week trial, the jury returned a verdict in less than two hours. Paul Calli, Michael Pasano and Marissel Descalzo of Carlton Fields, P.A. represented the defendant. (Carlton Fields press release) The criminal section has lost a number of high profile trials recently — DRAM (hung jury; decision not to re-prosecute) and magazine paper.
Jul
29
Posted by : | On : July 29, 2008
On July 25, 2008, the D.C. Circuit reversed summary judgment in favor of the government that denied appellant’s Freedom of Information Act request. Stolt-Nielsen Transportation Group Ltd. v. United States, Nos. 07-5191, 07-5192 2008 WL 2853214 (D.C. Cir. July 25, 2008) (attached Stolt v. U.S.). The appellant (Stolt-Nielsen) had sought the Antitrust Division’s amnesty agreements with other recipients that were based on the model that the Antitrust Division used in the early days of the program. Stolt limited its request to allow for redaction of the names of companies and individuals from the request. The amnesty program allows the first company or individual that self-reports an antitrust violation to receive immunity from prosecution except in extraordinary circumstances. Congress also has enacted legislation that reduces an amnesty recipient’s exposure from treble to single damages in private antitrust litigation. Thus, amnesty can be invaluable to a company that learns of criminal antitrust misconduct of its officers. The D.C. Circuit reversed the district court that held that the information sought by Stolt was not reasonably segregable because the district court did not make any findings to support its decision. The D.C. Circuit remanded the case for the district court to make findings consistent with its opinion. As you may recall, Stolt had been in litigation over enforcement of its amnesty agreement ultimately prevailing at trial. The Antitrust Division revoked the agreement claiming that Stolt breached it by continuing to violate the antitrust laws after entering into the agreement. The Eastern District of Pennsylvania disagreed and dismissed the indictment. (See Mach 15, 2008 Post, “DOJ’s Antitrust Division (Criminal Section) Suffers Four Major Losses Within the Last Year.”
Jun
26
Posted by : | On : June 26, 2008
On June 26, 2008, the Antitrust Division announced that Air France (and KLM Royal Dutch Airlines), Cathay Pacific, Martinair Holland and SAS Cargo Group entered into plea agreements for their participation in the cartel to fix air cargo rates. They agreed to fines of more than $504 million. Air France-KLM agreed to pay $350 million — the second largest fine for an antitrust conviction in U.S. history. Cathay agreed to a $60 million fine; Martinair agreed to a $42 million fine; and SAS agreed to a $52 million fine. So far, the Antitrust Division has obtained $1.27 billion in fines from guilty pleas by cartel participants. This is the largest amount of fines ever imposed as a result of a criminal antitrust investigation. The Antitrust Division’s press release is attached. DOJ Press Release (International Cargo Cartel)
Jun
15
Posted by : | On : June 15, 2008
On June 2, 2008, the Antitrust Division’s Criminal Section lost a four-day jury trial in the District of Columbia. In United States v. Keitt, 07-CR-041, the defendant was accused of paying a former associate director of the TSA in exchange for favorable treatment in overseeing and administering his company’s contract. The jury acquitted in less than one day. This is the fifth major blow to the Criminal Section within the last year. The March 15, 2008 post discusses the Criminal Section’s four other defeats within the last twelve months — three acquittals after trial and the denial of extradition by the U.K. House of Lords.