Health Care Company Indicted for Labor Market Collusion
A federal grand jury returned a two-count indictment charging Surgical Care Affiliates LLC and its related entity (collectively SCA), which own and operate outpatient medical care centers across the country, for agreeing with competitors not to solicit senior-level employees, the Department of Justice announced today. These are the Antitrust Division’s first charges in this ongoing investigation into employee allocation agreements.
“The charges demonstrate the Antitrust Division’s continued commitment to criminally prosecute collusion in America’s labor markets,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “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.”
“The charges demonstrate the FBI’s commitment to ensuring a free market and protecting opportunities for American workers,” said Steven M. D’Antuono, Assistant Director in Charge of the FBI Washington Field Office. “The FBI will continue to work with our partners to root out this type of illegal activity and deter employer collusion that harms the American people and workers.”
“Companies competing for top-level talent is the bedrock of the American labor market,” said U.S. Attorney Erin Nealy Cox for the Northern District of Texas. “The Northern District of Texas is proud to partner with the Antitrust Division to prosecute Sherman Act violations.”
The indictment, filed in the U.S. District Court for the Northern District of Texas, Dallas Division, charges SCA with entering into and engaging in two separate bilateral conspiracies with other health care companies to suppress competition between them for the services of senior-level employees, in violation of the Sherman Act. Beginning at least as early as May 2010 and continuing until at least as late as October 2017, SCA conspired with a company based in Texas to allocate senior-level employees by agreeing not to solicit each other’s senior-level employees. Beginning at least as early as February 2012 and continuing until at least as late as July 2017, SCA separately conspired with a company based in Colorado to allocate senior-level employees through a similar non-solicitation agreement.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
A violation of the Sherman Act carries a maximum penalty of a $100 million fine for corporations. The fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than the statutory maximum.
Today’s announcement is the result of an ongoing federal investigation being conducted by the Antitrust Division’s Washington Criminal II Section and the Washington Field Office of the FBI. Anyone with information on market allocation or price fixing by employers should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or visit https://www.justice.gov/atr/citizen-complaint-center.