Lessons Learned from United States v. AU Optronics

Lessons Learned from United States v. AU Optronics

by Rachel S. Brass, Joel Willard, and Rachel Flipse

In 2012 the DOJ conducted perhaps the most important trial under the international cartel enforcement and amnesty program. United States v. AU Optronics was also the first trial of a corporate defendant in a criminal price fixing case in over a decade; and the first trial of a foreign corporate defendant. From this truly landmark trial, certain lessons for future price fixing trials are revealed. This article focuses on those lessons.

Excerpt:

In 2012, the United States Department of Justice Antitrust Division ("DOJ" or "division") conducted what many leading antitrust practitioners have deemed "the most important trial ever conducted with the Antitrust Division's crown jewel, the international cartel enforcement and amnesty program." As acting Assistant Attorney General Joseph Wayland recently confirmed, "[t]he AUO conviction was a major victory for the division." That trial, which lasted eight weeks, "resulted in a historic first" for the division, as it "marked the first time the division litigated the double the gain or loss issue" that underlies the alternative fine calculation provision of 18 U.S.C. § 3571(d) [an annotated version of this statute is available to lexis.com subscribers].

The AUO case also marked the first trial of a corporate defendant in a criminal price fixing case in over a decade. It was also the first trial of a foreign (specifically Taiwanese) corporate defendant. Thus, the AUO trial presented a rare opportunity to see a jury engage with various theories of corporate defense in a criminal antitrust trial. It also presented an opportunity to evaluate first hand a jury's differing reactions to testimony presented with respect to corporate defendants and individual defendants. And the trial provided the opportunity to see a jury wrestle with questions of new and emerging technologies, differing approaches to business ethics and culture in cases involving largely foreign actors, and questions of the evolving role of the media in presenting a case.

From this trial, certain lessons for future price fixing trials-both civil and criminal-come to the fore. This article focuses on lessons as they relate to the jury, focusing on lessons for corporate defendants. First, while we have entered an era in which political candidates watch their fortunes fluctuate in real-time on Twitter, and stock trading and value correlate with "Likes" on Facebook, the ability to sell a story in the media does not equal success in the courtroom. Second, the AUO trial tells us that defendants who rely on attacking and attempting to undermine the credibility of cooperating witnesses may face an uphill battle, particularly when the evidence of conspiracy is "overwhelming." Third, the jury verdict points up the risk defendants take in a criminal case, particularly corporate defendants, when their counsel offer up specific rationales for the underlying conduct, but no percipient witnesses testify for the defense. Fourth, the AUO conviction is an important reminder that jury members do not leave common sense at the courthouse door.

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Rachel S. Brass is a partner in the San Francisco office of Gibson, Dunn & Crutcher. She is a member of the firm's Litigation Department. Ms. Brass's practice focuses on domestic and international antitrust and competition law and appellate litigation. Ms. Brass is a member of the Steering Group for the Antitrust Committee of the American Bar Association's Section of International Law and Vice Chair of the Executive Committee of the Bar Association of San Francisco's Antitrust Section. She is a member of the Board of the Northern California Chapter of the Association of Business Trial Lawyers.

Joel Willard is a Senior Attorney at Intel.

Rachel A. Flipse is an associate in the San Francisco office of Gibson, Dunn & Crutcher. She currently practices in the firm's Litigation Department.