Cadwalader Clients & Friends Alert: Criminal Antitrust Whistleblower Act Reintroduced

On January 22, 2013, Sens. Patrick Leahy (D-VT) and Chuck Grassley (R-IA) reintroduced legislation to the Senate Judiciary Committee that would extend whistleblower protections to employees who provide information to federal prosecutors in criminal antitrust investigations. If passed, the Criminal Antitrust Anti-Retaliation Act of 2013 ("Act") would allow employees to file a complaint with the U.S. Department of Labor about suspected retaliation for cooperating with the Department of Justice.

The Act would amend the Antitrust Criminal Penalties Enforcement and Reform Act, which protects guilty informants through the Antitrust Division's Leniency Program. The Act would apply to innocent third parties who come forward and report antitrust violations. Also, as written, the Act would protect any individual except those who "planned and initiated" the antitrust conspiracy (emphasis added). This narrow limitation allows for protection of a broad class of employees who may not only have violated company policies but may even have acted in their own personal interest rather than in the best interests of the company.

The effort to introduce the Act was the result of a July 2011 Government Accountability Office study that stated: "Without civil remedy for those who are retaliated against as a result of reporting criminal antitrust violations, whistleblowers are currently unprotected and may therefore be hesitant to report wrongdoing to DOJ." The GAO's research found that there was no consensus among key stakeholders interviewed (antitrust plaintiffs' and defense attorneys among others) regarding the addition of a whistleblower reward, but there was wide support for adding anti-retaliatory protection. Sens. Leahy and Grassley reported that the Act would create whistleblower protections modeled on those in Sarbanes-Oxley, the 2002 financial accounting and corporate governance reform law that both senators played a role in drafting.

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