DOJ Antitrust Corporate Dispositions May Protect Some Culpable Employees

In Short

The Situation: Corporate plea agreements can eventually resolve liability for most companies under investigation by the U.S. Department of Justice's Antitrust Division, but the potential prosecutions of current or former employees remain a concern.

The Result: Companies facing these investigations must negotiate leniency agreements or plea deals protecting employees from individual prosecutions.

Looking Ahead: Companies can take steps to secure nonprosecution protection for employees as part of a corporate disposition, avoiding lengthy and possibly embarrassing employee prosecutions.

Most companies under criminal investigation by the Antitrust Division, U.S. Department of Justice ("DOJ") eventually resolve their liability with the government short of going to trial, either by entering into a corporate leniency agreement or more commonly by pleading guilty to criminal antitrust charges under a corporate plea agreement. Foremost on the minds of corporate counsel when negotiating these agreements is ensuring that the company pays no criminal fine under leniency or as small a fine as possible under a plea agreement. But it is often equally important to the company to maximize the number of its employees covered by the corporate disposition, thereby eliminating the possibility that those employees will be individually prosecuted by DOJ.

The stakes are enormous for a company trying to obtain nonprosecution or immunity protection for the broadest number of its employees who have been involved in antitrust "cartel" conduct such as price fixing. Even if a company is able to resolve its own criminal liability, it still cannot put the criminal investigation behind it when some current employees remain under investigation for months or years. Even worse, for those employees taking their chances at trial, the government inevitably will parade cooperating witnesses before the jury and highlight inflammatory company documents, publicly demonstrating the scope of the company's wrongdoing.

This Commentary provides background on DOJ policy and practice and highlights some of the steps corporate counsel (as well as "spin off" counsel for individual employees) can take during leniency or plea negotiations to secure nonprosecution protection for the company's employees as part of any antitrust corporate disposition.

DOJ's Goal of "Individual Accountability"

As a matter of policy, in corporate dispositions, DOJ does not provide blanket nonprosecution...