The Antitrust Division, through a federal grand jury, indicted seven Japanese executives for conspiring to fix prices in the long running auto parts investigation. There were two separate indictments. One charged executives from Mitsubishi Electric Corp. with conspiring to fix the prices of starter motors, alternators and ignition coils from at least 2000 through 2010. In the second indictment, four executives from Hitachi Automotive Systems were charged with conspiring to fix prices of multiple auto parts including starter motors, fuel injection systems, and ignition coils.
Atsushi Ueda, Minoru Kurisaki, and Hideyuki Saito of Mitsubishi Electric Corp. were charged with conspiring to fix the prices of certain automotive products sold to Ford Motor Company, General Motors LLC, Chrysler Group LLC, Fuji Heavy Industries Ltd., Nissan Motor Company Ltd., and Honda Motor Company Ltd. in the United States and elsewhere. This indictment also charged Kurisaki and Saito with knowingly conspiring to obstruct justice by destroying documents and corruptly persuading, and attempting to persuade others, to destroy documents. Saito was charged in an additional count with knowingly and corruptly persuading, and attempting to persuade, executives to destroy documents and delete electronic data that may contain evidence of antitrust crimes.
The second indictment charged Takashi Toyokuni, Ken Funasaki, Kazunobu Tsunekawa and Tomiya Itakura of Hitachi Automotive Systems Ltd. with conspiring to fix the prices of at least nine automotive parts sold to various automobile manufacturers such as, Ford Motor Co., General Motors LLC, Nissan Motor Co. Ltd., Toyota Motor Corp., and Honda Motor Co. Ltd., in the United States and elsewhere.
In the auto parts investigation 28 companies, mostly Japanese, have been fined more than $2.4 billion. In addition, 43 individuals have been charged. Twenty-six individuals have pleaded guilty and have been sentenced to prison terms ranging from a year and a day to two years. Both Mitsubishi Electric and Hitachi Automotive pleaded guilty in November 2013 to criminal price-fixing charges, and were fined $190 million and $195 million, respectively. As discussed below, the indicted executives were “carve-outs” from the corporate plea agreement and subject to prosecution. Many if not all of the corporate plea agreements have likely included carve-outs, so there may be additional indictments against individuals as the auto parts investigation moves through its final phase.
Corporate plea agreements between the Antitrust Division and corporate defendants typically deal with individual executives as well. The corporation would like to receive non-prosecution protection for as many executives as it can in return for their cooperation with the government. But, the Antitrust Division seeks to hold individuals accountable and will demand that certain individuals be “carved out.” Carve-outs are not covered by the plea agreement and are subject to prosecution. Of these carve-outs, some reach a separate plea agreement of their own with the Division and agree to plead guilty, serve some jail sentence and cooperate in the investigation. Twenty-six individuals have done so in the auto parts matter. Other “carve-outs” who don’t reach plea agreements are identified in the corporate plea agreement in an Appendix that is filed under seal. These individuals are subject to prosecution. The individuals indicted yesterday were carve-outs from the corporate plea agreements reached last year between the Antitrust Division and Mitsubishi Electric and Hitachi. Not all carve-outs are ultimately indicted, but it is current DOJ policy to name only those likely to be indicted as carve-outs in the filing placed under seal. A carved-out individual may also be indicted under seal. [Read more…]