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With their client facing a possible $250 million criminal fine for price-fixing, defense lawyers representing international shipping company Stolt-Nielsen S.A. had few options. Typically, defenders of companies in antitrust trouble are risk-averse. Fearing that assertiveness could backfire, they proceed with more caution than aggression in their dealings with lawyers from the Federal Trade Commission or the U.S. Department of Justice Antitrust Division. If antitrust lawyers get in a “no holds barred, knock-down drag-out fight with an opponent in litigation, they may be trying to get merger clearance from that same opponent the next month,” said Stolt-Nielsen’s co-lead defender, Christopher M. Curran, litigation practice chairman in White & Case’s Washington office. That’s why “antitrust lawyers don’t try cases,” said Stolt-Nielsen’s other co-lead defender, J. Mark Gidley, who chairs White & Case’s global antitrust practice. “If you can settle and get everything you need, of course we’d settle. It’s cheaper. It’s simpler. But many times, the agency has an axe to grind.” In Stolt-Nielsen’s case, the Justice Department was intent on punishment, Gidley and Curran said. The government had immunized Stolt-Nielsen in 2003 as a reward for confessing to a price-fixing scheme and cooperating in the prosecution of co-conspirators. In 1998, the Stolt-Nielsen Transportation Group, a Luxembourg subsidiary, entered into a customer-allocation conspiracy with two primary competitors, Odfjell Seachem A/S of Norway and Jo Tankers B.V. of the Netherlands. Under the agreement, the companies refrained from competing for certain customers allocated to another party. Stolt-Nielsen’s arrangement with Odfjell was formalized by exchanging customer lists, but the Jo Tankers deal was ad hoc. Both agreements violated antitrust laws. However, the government revoked the amnesty agreement based on claims made by the co-conspirators that Stolt-Nielsen had continued its illegal conduct past the time it had told the government it had stopped. Prosecutors sought indictment. Stolt-Nielsen’s only hope was to sue the government to seek judicial enforcement of the amnesty agreement, defense lawyers said. A litigation strategy was worth the risk, say Gidley and Curran, who’ve been litigating antitrust cases together since 1995. Rather than just brace for impact, Curran and Gidley took the offensive, suing the government to obtain an injunction against prosecution. In 2004, after a two-day hearing, a Philadelphia federal judge granted the injunction. It was overturned in 2006 by the 3d U.S. Circuit Court of Appeals on separation of powers grounds. Stolt-Nielsen was indicted along with two executives for violating Section 1 of the Sherman Act. The defense strategy — keeping on the offense — didn’t change. Curran and Gidley filed a motion to dismiss the indictment. They presented the judge with 100 declarations from employees asserting that no price-fixing occurred after March 2002, the time frame at issue. A four-week hearing on the motion to dismiss had all the markings of a big criminal trial: 1,000 exhibits and witnesses and 125,000 documents. The defenders borrowed their overall strategy from tennis: charge the net. Curran and Gidley won procedural advantages, such as convincing the judge to allow them to present their case first. “It’s frequently more effective to tell our story first so the fact-finder can hear our side of the story first when making those initial impressions of the case,” Curran said. The trial turned on witness credibility. Rejecting what they called a cautious minimalist approach, the defenders offered a parade of witnesses testifying that the improper conduct stopped in March 2002. Judges and juries are comforted by repetition of key themes from a variety of witnesses, the lawyers said. When there are lots of witnesses, their individual “quirks or warts” are overlooked if their testimony as a group is consistent, Curran said. The defenders also aimed heavy artillery into the credibility of the government witnesses. Stolt-Nielsen’s cooperation had resulted in $62 million in fines and prison sentences against other co-conspirators, some of whom were granted immunity or lenience for their own testimony against Stolt-Nielsen. But many of those witnesses had made contradicting claims in lawsuits and other proceedings in far-flung jurisdictions worldwide, Curran said. In November 2007, the Philadelphia trial judge held that the government had failed to prove that Stolt-Nielsen had continued price-fixing. The judge discredited the testimony of government witnesses, noting their motivation to retaliate against Stolt-Nielsen. The judge said the Antitrust Division had no reasonable basis to revoke the agreement. U.S. v. Stolt-Nielsen, No. 06-cr-466 (E.D. Pa.). Lead prosecutor Antonia R. Hill of the Antitrust Division declined comment. The pair also scored a high-profile defense win for Upsher-Smith Laboratories Inc. in a 40-day trial of a case filed by the Federal Trade Commission over the settlement of patent litigation. Representing Malaysian producers of rubber thread accused of price-fixing overseas, Curran and Gidley led the team that won a defense verdict. Dee-K Enterprises Inc. v. Heveafil, CA-98-10-3-MU (W.D.N.C.).

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