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Justice Nears Antitrust Win in Probe of No-Poaching Agreement (1)

Sept. 2, 2022, 1:46 PMUpdated: Sept. 2, 2022, 2:53 PM

The Justice Department is nearing its first-ever criminal win in a so-called no-poaching case, securing a guilty plea from a health-care staffing provider accused of agreeing not to hire a competitor’s nurses.

Such an accord is a violation of antitrust law. The provider, Ohio-based VDA, filed Sept. 1 a notice of intent to plead guilty in USA v. Hee in the US District Court for the District of Nevada.

The filing follows the DOJ antitrust division’s failure to nab conviction in two other criminal cases it brought against employers for alleged no-poaching and other anti-competitive hiring practices.

In 2016, the DOJ and the Federal Trade Commission said they would treat such labor antitrust violations as criminally prosecutable.

VDA “gives notice to the court that it intends to change its plea to a plea of guilty,” the company said in the filing. “There is no plea agreement in this case.”

The DOJ sued VDA and Ryan Hee, the company’s former regional manager, in March 2021 for allegedly conspiring with a competitor to suppress wages and not hire or recruit nurses staffed by their companies at school facilities in Clark County, Nevada.

The staffing company could face a maximum penalty of up to $100 million or twice the monetary impact damaged or gained by its actions—whichever is greater—according to the filing.

The DOJ charged Hee and VDA, then called Advantage On Call, with a single count each of violating Section 1 of the Sherman Act, which prohibits conspiracies in restraint of trade.

“During the period between October 21, 2016 and in or around July 1, 2017, the Defendant, through one of its employees, participated in a conspiracy with another contract healthcare staffing firm to suppress and eliminate competition for the services of nurses by agreeing to allocate nurses and to fix the wages of those nurses,” VDA said in the filing.

Attorneys for VDA didn’t immediately respond to a request for comment.

Two other criminal labor-market antitrust cases—USA v. DaVita and USA v. Jindal—ended in acquittals in April.

Three other similar cases brought by the DOJ’s antitrust division are pending.

The case is USA v. Hee et al, D. Nev., no 2:21-cr-00098, 9/1/22.

(Updated with additional reporting throughout. )

To contact the reporter on this story: Dan Papscun in Washington at dpapscun@bloombergindustry.com

To contact the editors responsible for this story: Melissa B. Robinson at mrobinson@bloomberglaw.com; Roger Yu at ryu@bloomberglaw.com