The Department of Justice (DOJ) lost its third jury trial in its mission to secure criminal convictions against companies and executives accused of labor-side antitrust violations on March 22, 2023, when a jury in Maine acquitted four home healthcare staffing executives of violating Section 1 of the Sherman Act. In United States v. Manahe, the DOJ charged Faysal Kalayaf Manahe, Yaser Aali, Ammar Alkinani, and Quasim Saesah with entering into an approximately two-month conspiracy between April and May 2020 not to hire each other’s caretakers and to fix caretaker wages.[1] After the district court declined to dismiss the indictment, holding the DOJ had successfully alleged a per se conspiracy to fix wages and allocate employees, the case proceeded to a two-week trial. At trial, defendants—all immigrants from Iraq, many of whom served as translators for U.S. forces there—admitted that they discussed setting wage levels and refraining from hiring each other’s employees, and even drafted an agreement with signature lines that outlined the terms of defendants’ discussions.[2] Defendants argued that they never reached an agreement in violation of Section 1 because the draft agreement was never signed. Defense counsel emphasized in opening statements that in defendants’ culture, “when dealing with business matters . . . the only way to confirm a commitment is to put it into a formal written contract.” Given the verdict, it appears the jury agreed.

There are several takeaways from Manahe—including the importance of sensitizing juries to cultural differences that may inform how they view the evidence—an issue of particular significance in the context of antitrust trials, which often involve multinational and foreign defendants. But the key takeaway is that the DOJ has now failed to secure jury convictions on antitrust counts in all three cases it has brought to trial based on theories of collusion in labor markets. In addition to Manahe, the DOJ suffered two losses in 2022 in United States v. Jindal and United States v. DaVita. In Jindal, a jury acquitted defendants of charges that they conspired to fix the wages of physical therapist assistants in the Dallas area in 2017.[3] Shortly after the Jindal loss, a separate jury in Colorado acquitted DaVita and a former executive of charges that they entered into an agreement with their competitor to not solicit each other’s senior-level employees.[4]

The DOJ had success, however, in securing a plea agreement in United States v. Hee, where defendants—a staffing company and its former regional manager—pled guilty to violating Section 1 by entering into a no-hire agreement and agreement not to raise wages for school nurses in Clark County, Nevada.[5] Staffing company defendant, VDA OC LLC, agreed to pay $134,000 in criminal fines and restitution as a result of the plea. Mr. Hee agreed to 180 hours of community service and pretrial diversion, meaning that if Mr. Hee abides by the terms of his agreement and does not violate any laws for six months, DOJ will drop its charges against him.

More labor collusion cases are in store. Following the acquittals in Jindal and DaVita, Assistant Attorney General Jonathan Kanter declared on April 21, 2022 that the Division is “not part of the chickenshit club” and will “hold criminals accountable” for antitrust violations that affect workers.[6] Consistent with that caution, on March 15, 2023, the DOJ secured another indictment from a federal grand jury in Nevada against healthcare staffing executive, Eduardo Lopez, alleging that Mr. Lopez conspired to fix the wages of Las Vegas nurses. Several of the same prosecutors in Hee are involved in Lopez. And the DOJ will soon have another opportunity to test its theories before a jury in two upcoming cases: United States v. Patel et al., where trial is scheduled to begin next week on March 27, 2023, and United States v. Surgical Care Affiliates LLC, where the trial set for January 9, 2023 has been continued.[7] One thing is for certain: as Mr. Kanter promised in April 2022, the DOJ is “not backing down” anytime soon in its pursuit to establish that harms that affect workers are “actionable antitrust harms.”

FOOTNOTES

[1] Indictment, United States v. Manahe et al., No. 2:22-cr-00013 (D. Me. Jan. 27, 2022), ECF No. 1, available at https://www.justice.gov/atr/case-document/file/1466736/download (last visited Mar. 23, 2023).

[2] Cara Salvatore, BREAKING: Home Health Execs Acquitted In Latest DOJ Antitrust Loss, Law360 (Mar. 22, 2023 4:14 PM EDT), https://www.law360.com/competition/articles/1586974?nl_pk=c8f12781-da40-417a-8433-e7d693ba2f9d&utm_source=newsletter&utm_medium=email&utm_campaign=competition&utm_content=1586974&nlsidx=0&nlaidx=0.

[3] Verdict of the Jury, United States v. Jindal, No. 20-cv-0358 (E.D. Tex. Apr. 14, 2022), ECF No 112.

[4] Judgment of Acquittal, United States v. DaVita, Inc., No. 21-cr-0229 (D. Colo. Apr. 20, 2022), ECF No. 266

[5] Unopposed Mot. to Waive Presentence Investigation, United States v. Hee, No. 2:21-cr-00098 (D. Nev. Oct. 17, 2022).

[6] Assistant Attorney General Jonathan Kanter, Question & Answer to Keynote at the University of Chicago Stigler Center—Antitrust Enforcement: The Road to Recovery, Unofficial Transcript of Event (Apr. 21, 2022).

[7] Order Resetting Trial, United States v. Surgical Care Affiliates LLC, No. 3:21-cr-00011 (N.D. Tex. Nov. 11, 2022), ECF No. 173.