DOJ Criminal Trial Win Is a Warning to Companies on Compliance

The Department of Justice Antitrust Division’s recent win of its first ever criminal trial conviction in a labor conspiracy case underscores the need for companies to step up vigilance when it comes to antitrust training and compliance issues.

The conviction, which relied heavily on employee text messages, highlights the need for legal departments to have a handle on what unofficial messaging their employees may use outside of a company-managed email platform. Organizations also need a comprehensive approach to antitrust compliance and training, particularly as enforcers signal continued vigorous enforcement on labor issues.

On April 16, a federal jury in Nevada convicted Eduardo “Eddie” Lopez—the owner of a Las Vegas home health care staffing company—of illegally conspiring with competitors to cap the wages of nurses employed by the companies at $30 per hour. During the trial, the DOJ introduced text messages in which Lopez wrote to two rivals that “we are all in the same boat for staffing” and that “we all have a mutual agreement that with the pay increase, all three companies will stay within the same hourly rate.” Lopez was also convicted of wire fraud for failing to disclose the DOJ’s investigation in connection with the sale of his company.

The verdict likely will further embolden labor-related enforcement by DOJ and Federal Trade Commission leadership. Both agencies have recently expressed concern over the potential for company employees to be victimized by employment-related antitrust concerns, including wage fixing, no-poach agreements, and employee non-competes. The DOJ has recently ramped up efforts to police alleged wage-fixing and no-poach agreements between competing employers.

The DOJ has suffered multiple litigated losses since 2022, leading some to question the viability of labor antitrust claims, particularly as alleged criminal violations. However, the government has remained committed to bringing such cases, and securing its first major trial win will further fuel those efforts.

This is a particularly interesting development because it wasn’t initially clear how aggressive the Trump administration’s antitrust enforcers would be on labor issues. This verdict, combined with other public statements, shows that both the DOJ and the FTC have staked out a position on labor that is in many ways at least as aggressive as that of former President Joe Biden’s top antitrust officials, Jonathan Kanter and Lina Khan.

Responding to the verdict, DOJ antitrust head Gail Slater said it “should be a clear message” and that “wage-fixing agreements are nakedly unlawful attempts at unjustly profiting off American workers.” Slater added that DOJ “will zealously prosecute those who seek to unjustly profit off their employees.”

Slater’s comments echo those of other top antitrust enforcers in recent public appearances signaling that the agencies will be aggressive on labor issues. Earlier in April, Slater participated in a roundtable event with union leaders to discuss ways that non-compete agreements, no-poach agreements, and other forms of unfair labor practices affect workers. And FTC Chair Andrew Ferguson said at another event earlier in April that the Trump administration will use a recently launched labor task force to bring enforcement actions against companies found to unreasonably use noncompete agreements for unskilled jobs.

Perhaps equally notable for companies going forward is the DOJ’s reliance at trial on text messages from Lopez to his counterparts at competing health-care companies, which appear to have been sufficiently convincing to secure a guilty verdict from the jury. Monitoring email traffic on company servers for interactions with competitors, for example, may no longer be particularly effective. To the extent an employee is engaging in anticompetitive conduct via text message, online chat, or a third-party messaging platform such as WhatsApp or Signal, this conduct may slip under the radar of company-established safeguards.

Compliance teams should consider additional measures to address such risks. They should seek to understand how employees use different communication services for work-related communications, then assess potential updates to employment and compliance policies. Employee training programs should cover the company’s policy on text messages or chat tools as well as potential consequences for the employee and the company if certain tools are used to improperly coordinate with competitors.

The DOJ telegraphed the importance of these issues in its most recent update to its Evaluation of Corporate Compliance Programs in Criminal Antitrust Investigations. It noted that effective antitrust compliance programs should be operative “across the organization,” including areas such as human resources that historically were lower risk from an antitrust perspective.

The DOJ’s communication guidelines make sense in the abstract—but they take on greater significance in light of cases such as Lopez, where noncompliance results in monetary penalties as well as actual criminal liability.

Businesses should view Lopez’s criminal conviction, along with the recent statements by agency leaders, as an indication that labor-related antitrust enforcement will continue to intensify. Companies should review antitrust compliance policies and ensure that they appropriately address issues relating to workers, and human resources professionals should receive appropriate antitrust training.

Similarly, the government’s reliance on text messages in the Lopez case, and his related conviction for nondisclosure in selling his business, underline the need to ensure that those involved in M&A activity receive appropriate counseling regarding required disclosures.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Martin Mackowski is a partner in the antitrust and competition practice at Squire Patton Boggs.

Michael Wise is the US antitrust and competition practice group leader at Squire Patton Boggs.

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