In recent weeks, the U.S. Department of Justice (DOJ), Antitrust Division, announced prosecutions into wage-fixing and no-poach agreements in Texas federal courts. These criminal investigations reveal an emphasis by the Antitrust Division to combat collusion in America’s labor markets.
On December 10, 2020, a federal grand jury in Sherman, Texas, indicted Neerjal Jindal, the former owner of a therapist staffing company, for participating in a conspiracy to fix prices (wage-fixing) by lowering the rates paid to physical therapists and physical therapist assistants involving in-home therapy services in north Texas. This matter represents the DOJ’s first criminal prosecution of wage-fixing conduct. The indictment also charges Jindal with obstruction of justice for making false and misleading statements to the Federal Trade Commission during its investigation into the same conduct. The FBI assisted in the investigation.
“The charges announced today are an important step in rooting out and deterring employer collusion that cheats American workers — especially health care workers — of free market opportunities and compensation,” said Assistant Attorney General Makan Delrahim of the Antitrust Division. “Employers who conspire to fix wages of workers or restrict their mobility by allocating labor markets will be prosecuted to the fullest extent of the law. The Division will also continue to prosecute those who undermine the integrity of federal investigations, including proceedings before other federal agencies.”
On January 7, 2021, a federal grand jury in Dallas, Texas, returned an indictment charging Surgical Care Affiliates LLC (SCA) with entering into and engaging in two separate conspiracies with other health care companies to suppress competition by agreeing not to solicit each other’s senior-level employees in Texas and Colorado. These are the Antitrust Division’s first charges in this ongoing investigation into employee allocation agreements, commonly known as no-poach or non-solicitation agreements. Again, the FBI assisted in the investigation.
Relating to this investigation, Assistant Attorney General Delrahim advised, “the charges demonstrate the Antitrust Division’s continued commitment to criminally prosecute collusion in America’s labor markets. A freely competitive employment market is essential to the health of our economy and the mobility of American workers. Along with our law enforcement partners, the Division will ensure that companies who illegally deprive employees of competitive opportunities are not immune from our antitrust laws.”
With DOJ’s increasing emphasis placed on collusion in America’s labor markets, the experienced attorneys at Dysart Willis Houchin & Hubbard stand ready to provide aggressive legal counsel in antitrust law, white collar crime, and other business law related matters, including drafting, implementing, and monitoring effective training and compliance programs.