For the first time, and after many attempts, the Antitrust Division of the U.S. Department of Justice (“DOJ”) announced that it had successfully extradited a foreign national to stand trial in the U.S. to face criminal antitrust charges for price fixing, bid rigging, and market allocation. Prior attempts at extradition in antitrust cases have been unsuccessful, in part, because extradition generally requires dual criminality – meaning that the charged offense must be a crime under both countries’ laws. For example, in 2010, the British courts declined to allow the extradition of Ian Norris to the United States on charges of price fixing, on the ground that there was no similar statute in the United Kingdom at the time, although he ultimately was extradited for trial in Pennsylvania on charges of obstruction.
According to the DOJ, Germany extradited Romano Pisciotti on charges of conspiring to rig bids, fix prices, and allocate market shares to suppress and eliminate competition. Pisciotti, an Italian national, is a former executive with Parker ITR Srl, a marine hose manufacturer headquartered in Italy. If convicted, he could face up to 10 years in prison (the maximum sentence under U.S. law) as well as a fine of up to $1 million (or more, depending upon the circumstances).
Although the DOJ notice does not describe the specific basis for the extradition, under German law persons convicted of bid rigging may be sentenced to up to five years in prison. Until now, the DOJ had not successfully litigated an antitrust extradition and has been forced to reach plea agreements with foreign executives, offering lower sentences and the right to travel to the U.S. in exchange for guilty pleas. In response, the DOJ has worked for many years to convince other countries to criminalize price fixing and bid rigging violations. Most extradition treaties require extradition of individuals to the U.S. if the resident country recognizes the alleged actions as an “offense committed in similar circumstances.” Currently, price fixing or bid rigging is subject to criminal prosecution in a number of countries, including Germany and many other EU countries.
It should be noted that in this case Germany extradited an Italian citizen, not one of its own citizens. Country specific legal limitations on extradition generally, as well as political realities, reflect a likelihood that it could be more difficult for the DOJ to successfully persuade a country to extradite its own citizens for antitrust violations, even where the conduct alleged by the U.S. to be criminal is also prosecuted in that country. A decision by a government to extradite to the U.S. one of its own citizens
will continue to be decided on a case-by-case basis and is far from automatic. The German government’s willingness to extradite the citizen of another country, however, should force those foreign nationals who may be under the DOJ’s microscope to carefully consider where they live and travel.
In any event, the lessons of this successful extradition are clear:
- The U.S. Department of Justice will continue to try to prosecute non-U.S. companies and their executives on criminal antitrust charges.
- The more countries that pass laws criminalizing antitrust violations, the more likely it will be that the business executives in those countries will find themselves subject to potential extradition and criminal prosecution in the U.S. under its antitrust laws.