David Kully is a Partner for Holland & Knight's Washington, D.C. office.
Shortly after the arrival last fall of Makan Delrahim as head of the DOJ's Antitrust Division, the DOJ quietly introduced a subtle but significant change to the consent decrees it uses to settle antitrust disputes. This change will make it easier for the DOJ to enforce the terms of its consent decrees going forward – and harder for antitrust defendants to evade any obligations imposed upon them under their settlements.
Antitrust consent decrees are agreements between the DOJ and antitrust defendants setting forth the terms of the settlement, including commitments the DOJ demands of defendants (and to which defendants agree) as a condition of settlement. Antitrust settlements are subject to the review and approval of the court where a case is filed (under the process established by the Tunney Act), and the approving court retains jurisdiction to enforce the terms of the consent decree and to punish the defendants for violations by holding them in contempt. Under established caselaw, however, the DOJ faces a significant challenge in showing that a defendant violated a consent decree and deserves to be held in contempt. To establish that a defendant should be held in contempt, the DOJ must present "clear and convincing evidence" that the antitrust defendant violated a "clear and unambiguous" provision in the consent decree.
Mr. Delrahim's arrival at the DOJ brought a change to its consent decrees intended to supersede the challenging contempt standard. In recent consent decrees, the DOJ has insisted that defendants agree that, to establish a violation of the consent decree and obtain a civil contempt finding, the DOJ would need to prove the violation not by "clear and convincing" evidence, but by the lower "preponderance of the evidence" standard – meaning that it is just more likely than not that the defendant did not follow the rules to which it agreed.
Mr. Delrahim made it clear in remarks last week that this change is not going away. On January 19, at an event sponsored by the Antitrust Research Foundation, Mr. Delrahim described these new terms as "non-negotiable" in future antitrust settlements. As least on Mr. Delrahim's watch, the DOJ will not agree to any antitrust settlements that do not follow this new approach.
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