Federal prosecutors are hailing the conviction this week of a former British executive as a signal to corporate leaders to shape up.
A federal jury in Philadelphia Tuesday convicted Ian Norris, the former CEO of The Morgan Crucible Company plc, of conspiring with others to obstruct justice in an antitrust investigation. Norris faces a maximum penalty of five years in prison and a $250,000 fine.
Also See: DOJ Press Release
The verdict "sends a message that corporate leaders must promote a culture of law-abiding conduct within their companies or be prepared to face stiff prison sentences," said Christine Varney, assistant attorney general in charge of the Department of Justice's Antitrust Division.
Morgan Crucible's general counsel, Paul Boulton, was not immediately available for comment. But Norris' U.S. attorneys, Christopher Curran and J. Mark Gidley of White & Case, issued a statement saying they were "gratified" that the jury acquitted Norris on two related counts and that they will appeal the conviction.
Their statement said, "We are disappointed by the jury's conviction of Mr. Norris on the conspiracy count (24 hours after the jury announced an "impasse" on this count). But based upon juror interviews, we believe that the jury was confused. We intend to act quickly to overturn the sole count of conviction."
Morgan Crucible, based in Windsor, England, operates in 34 countries with 9,400 employees, according to its 2009 annual report. It is a materials engineering company with a broad range of products, from carbon brushes and bearings for railcars to furnaces for the metals casting industry. It also produces military body armor.
The company pleaded guilty in 2002 to one count of tampering with witnesses and one count of document destruction. It paid a $1 million criminal fine.
In addition, a former subsidiary of the company, Morganite Inc., then based in Dunn, N.C., pleaded guilty in 2002 to fixing prices of carbon brushes and other carbon products and paid a $10 million fine. And three subordinates of Norris previously pleaded guilty to obstruction charges.
But Norris fought the Justice Department every step of the way. A federal grand jury in 2004 indicted him on one count of fixing prices, one count of conspiring to obstruct justice, and two counts of obstructing justice in the feds' investigation of price fixing in the carbon products industry.
Norris battled against extradition for nearly six years, but was finally extradited to the United States in March on the three obstruction charges. England refused extradition on the price-fixing charge.
The jury returned a guilty verdict on the conspiracy to obstruct justice count and not guilty verdicts on counts related to alleged witness tampering and persuading others to destroy or conceal documents. Sentencing is scheduled for Nov. 2.
Prosecutors alleged that Norris conspired with his subordinates to obstruct the grand jury's investigation by creating a false script that employees of both Morgan Crucible and a competitor were to follow when questioned. Also, a document destruction task force was formed to collect and destroy or conceal documents from the grand jury, prosecutors said.
Trial attorneys Lucy McClain, Richard Rosenberg, and Kimberly Justice of the Antitrust Division's Philadelphia field office prosecuted the case.
