United States v. Jier Shin Korea Co., Ltd., et al.; Proposed Final Judgment and Competitive Impact Statement, 21462-21473 [2020-08138]

Download as PDF 21462 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices DEPARTMENT OF JUSTICE Antitrust Division jbell on DSKJLSW7X2PROD with NOTICES United States v. Jier Shin Korea Co., Ltd., et al.; Proposed Final Judgment and Competitive Impact Statement Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b)–(h), that a proposed Final Judgment, a Stipulation, and a Competitive Impact Statement have been filed with the United States District Court for the Southern District of Ohio in United States v. Jier Shin Korea Co., Ltd., et al., Case No. 2:20–cv– 1778. On April 8, 2020, the United States filed a Complaint alleging that between 2005 and 2016, Jier Shin Korea Co., Ltd. (‘‘Jier Shin Korea’’) and its president Sang Joo Lee, along with other co-conspirators, conspired to rig bids for Posts, Camps & Stations (PC&S) and Army and Air Force Exchange Service (AAFES) fuel supply contracts with the U.S. military in South Korea, in violation of Section 1 of the Sherman Act, 15 U.S.C. 1. A proposed Final Judgment, filed at the same time as the Complaint, requires Defendants to jointly and severally pay the United States $2,000,000. In addition, Defendants have agreed to cooperate with further civil investigative and judicial proceedings and Jier Shin Korea has agreed to institute an antitrust compliance program. Copies of the Complaint, proposed Final Judgment, and Competitive Impact Statement are available for inspection on the Antitrust Division’s website at http://www.justice.gov/atr and at the Office of the Clerk of the United States District Court for the Southern District of Ohio. Copies of these materials may be obtained from the Antitrust Division upon request and payment of the copying fee set by Department of Justice regulations. Public comment is invited within 60 days of the date of this notice. Such comments, including the name of the submitter, and responses thereto, will be posted on the Antitrust Division’s website, filed with the Court, and, under certain circumstances, published in the Federal Register. Comments should be directed to Robert A. Lepore, Chief, Transportation, Energy & Agriculture Section, Antitrust Division, Department of Justice, 450 5th Street NW, Suite VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 8000, Washington, DC 20530 (telephone: 202–307–6349). Section 1 of the Sherman Act, 15 U.S.C. 1. Suzanne Morris, Chief, Premerger and Division Statistics. II. Defendants 4. Jier Shin Korea Co., Ltd. (‘‘Jier Shin Korea’’) is a small, privately held logistics company located in Seoul, South Korea. Jier Shin Korea provides logistics services related to the transportation of fuel, petroleum byproducts, and other goods. During the conspiracy, Jier Shin Korea partnered with a South Korean oil refiner, Hyundai Oilbank Co., Ltd. (‘‘Hyundai Oilbank’’), to supply fuel to U.S. military installations in South Korea, with Jier Shin Korea acting as the prime contractor under the relevant contracts. 5. Sang Joo Lee is the president of Jier Shin Korea. Jier Shin Korea is a closely held firm majority owned by Lee and his family. 6. Other persons, not named as defendants in this action, participated as co-conspirators in the offense alleged in this Complaint and performed acts and made statements in furtherance thereof. These co-conspirators include, among others, GS Caltex Corporation (‘‘GS Caltex’’), Hanjin Transportation Co., Ltd. (‘‘Hanjin’’), SK Energy Co., Ltd. (‘‘SK Energy’’), Hyundai Oilbank, and SOil Corporation (‘‘S-Oil’’). 7. Whenever this Complaint refers to any act, deed, or transaction of any business entity, it means that the business entity engaged in the act, deed, or transaction by or through its officers, directors, employees, agents, or other representatives while they were actively engaged in the management, direction, control, or transaction of its business or affairs. As president of Jier Shin Korea, Lee knowingly, directly, and substantially participated in the acts of Jier Shin Korea described herein. United States District Court for the Southern District of Ohio Eastern Division United States of America, Plaintiff, v. Jier Shin Korea Co., Ltd., Jindo Bldg., Room 1405, 37, Dohwa-dong, Mapo-gu, Seoul, South Korea, and Sang Joo Lee, c/o Jier Shin Korea Co., Ltd., indo Bldg., Room 1405, 37, Dohwadong, Mapo-gu, Seoul, South Korea, Defendants. Case No. 2:20–cv–1788 Complaint: Violation of Section 1 of the Sherman Act, 15 U.S.C. 1 Complaint The United States of America, acting under the direction of the Attorney General of the United States, brings this civil antitrust action to obtain equitable monetary relief and recover damages from Jier Shin Korea Co., Ltd. and Sang Joo Lee for conspiring to rig bids and fix prices, in violation of Section 1 of the Sherman Act, 15 U.S.C. 1, on the supply of fuel to the U.S. military for its operations in South Korea. I. Introduction 1. Since the end of the Korean War, the U.S. armed forces have maintained a significant presence in South Korea, protecting American interests in the region and safeguarding peace for the Korean people. To perform this important mission, American service members depend on fuel to power their bases and military vehicles. The U.S. military procures this fuel from oil refiners located in South Korea through a competitive bidding process. 2. For at least a decade, rather than engage in fair and honest competition, Defendants and their co-conspirators defrauded the U.S. military by fixing prices and rigging bids for the contracts to supply this fuel. Defendants met and communicated in secret with large South Korean oil refiners and other logistics companies, and pre-determined which conspirator would win each contract. Defendants or their coconspirators then fraudulently submitted collusive bids to the U.S. military. Through this scheme, Defendants reaped supracompetitive profit margins on the fuel delivered to the U.S. military. 3. As a result of this conduct, Defendants and their co-conspirators illegally overcharged American taxpayers by well over $100 million. This conspiracy unreasonably restrained trade and commerce, in violation of PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 III. Jurisdiction and Venue 8. The United States brings this action under Section 4 of the Sherman Act, 15 U.S.C. 4, and Section 4A of the Clayton Act, 15 U.S.C. 15a, seeking equitable relief, including equitable monetary remedies, and damages from Defendants’ violation of Section 1 of the Sherman Act, 15 U.S.C. 1. 9. This Court has subject matter jurisdiction over this action under 15 U.S.C. 4 and 15a and 28 U.S.C. 1331 and 1337. 10. Defendants have consented to venue and personal jurisdiction in this district for the purpose of this Complaint. 11. Defendants or their coconspirators entered into contracts with the U.S. military to supply and deliver fuel to U.S. military installations in South Korea. Under the terms of these E:\FR\FM\17APN1.SGM 17APN1 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices jbell on DSKJLSW7X2PROD with NOTICES contracts, Defendants or their coconspirators agreed that the laws of the United States would govern all contractual disputes and that U.S. administrative bodies and courts would have exclusive jurisdiction to resolve all such disputes. To be eligible to enter into these contracts, Defendants or their co-conspirators registered in databases located in the United States. For certain contracts, Defendants or their coconspirators submitted bids to U.S. Department of Defense offices in the United States. After being awarded these contracts, Defendants or their coconspirators submitted invoices to and received payments from U.S. Department of Defense offices in Columbus, Ohio, which included use of wires and mails located in the United States. 12. Through these contracts with the U.S. military, Defendants’ activities had a direct, substantial, and reasonably foreseeable effect on interstate commerce, import trade or commerce, and commerce with foreign nations. Defendants’ conspiracy had a substantial and intended effect in the United States. Defendants caused U.S. Department of Defense agencies to pay non-competitive prices for the supply of fuel to U.S. military installations. Defendants or their co-conspirators also caused a U.S. Department of Defense agency located in the Southern District of Ohio to transfer U.S. dollars to their foreign bank accounts. IV. Background 13. From at least March 2005 and continuing until at least October 2016 (‘‘the Relevant Period’’), the U.S. military procured fuel for its installations in South Korea through competitive solicitation processes. Oil companies, either independently or in conjunction with a logistics company, submitted bids in response to these solicitations. 14. The conduct at issue relates to two types of contracts to supply fuel to the U.S. military for use in South Korea: Post, Camps, and Stations (‘‘PC&S’’) contracts and Army and Air Force Exchange Services (‘‘AAFES’’) contracts. 15. PC&S contracts are issued and administered by the Defense Logistics Agency (‘‘DLA’’), a combat support agency in the U.S. Department of Defense. DLA, formerly known as the Defense Energy Support Center, is headquartered in Fort Belvoir, Virginia. The fuel procured under PC&S contracts is used for military vehicles and to heat U.S. military buildings. During the Relevant Period, PC&S contracts ran for a term of three or four years. DLA issued PC&S solicitations listing the fuel VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 requirements for installations across South Korea, with each delivery location identified by a separate line item. Bidders offered a price for each line item on which they chose to bid. DLA awarded contracts to the bidders offering the lowest price for each line item. The Defense Finance and Accounting Service (‘‘DFAS’’), a finance and accounting agency of the U.S. Department of Defense, wired payments to the PC&S contract awardees from its office in Columbus, Ohio. 16. AAFES is an agency of the Department of Defense headquartered in Dallas, Texas. AAFES operates official retail stores (known as ‘‘exchanges’’) on U.S. Army and Air Force installations worldwide, which U.S. military personnel and their families use to purchase everyday goods and services, including gasoline for use in their personal vehicles. AAFES procures fuel for these stores via contracts awarded through a competitive solicitation process. The term of AAFES contracts is typically two years, but may be extended for additional years. In 2008, AAFES issued a solicitation that listed the fuel requirements for installations in South Korea. Unlike DLA, AAFES awarded the entire 2008 contract to the bidder offering the lowest price across all the listed locations. V. Defendants’ Unlawful Conduct 17. From at least March 2005 and continuing until at least October 2016, Defendants and their co-conspirators engaged in a series of meetings, telephone conversations, emails, and other communications to rig bids and fix prices for the supply of fuel to U.S. military installations in South Korea. 2006 PC&S and 2008 AAFES Contracts 18. GS Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea (through Lee and other agents) conspired to rig bids and fix prices on the 2006 PC&S contracts, which were issued in response to solicitation SP0600–05–R– 0063, supplemental solicitation SP0600–05–0063–0001, and their amendments. The term of the 2006 PC&S contracts covered the supply of fuel from February 2006 through July 2009. 19. Between early 2005 and mid-2006, GS Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea met multiple times and exchanged phone calls and emails to allocate the line items in the solicitations for the 2006 PC&S contracts. For each line item allocated to a different co-conspirator, the other conspirators agreed not to bid or to bid high enough to ensure that they would not win that item. Through these PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 21463 communications, these conspirators agreed to inflate their bids to produce higher profit margins. DLA awarded the 2006 PC&S line items according to the allocations made by the conspiracy. 20. As part of their discussions related to the 2006 PC&S contracts, Jier Shin Korea and other conspirators agreed not to compete with SK Energy in bidding for the 2008 AAFES contract. In 2008, GS Caltex, Hyundai Oilbank, and Jier Shin Korea honored their agreement: GS Caltex bid significantly above the bid submitted by SK Energy for the AAFES contract, while Hyundai Oilbank and Jier Shin Korea declined to bid even after AAFES explicitly requested their participation in the bidding. The initial term of the 2008 AAFES contract ran from July 2008 to July 2010; the contract was later extended through July 2013. As envisioned by the conspiracy, AAFES awarded the 2008 contract to SK Energy. 2009 PC&S Contracts 21. Continuing their conspiracy, Jier Shin Korea and other co-conspirators conspired to rig bids and fix prices for the 2009 PC&S contracts, which were issued in response to solicitation SP0600–08–R–0233. Hanjin and S-Oil joined the conspiracy for the purpose of bidding on the solicitation for the 2009 PC&S contracts. Hanjin and S-Oil partnered to bid jointly on the 2009 PC&S contracts, with S-Oil providing the fuel and Hanjin providing transportation and logistics. The term of the 2009 PC&S contracts covered the supply of fuel from October 2009 through August 2013. 22. Between late 2008 and mid-2009, Jier Shin Korea and other coconspirators met multiple times and exchanged phone calls and emails to allocate the line items in the solicitation for the 2009 PC&S contracts. As in 2006, these conspirators agreed to bid high so as to not win line items allocated to other co-conspirators. The original conspirators agreed to allocate to Hanjin and S-Oil certain line items that had previously been allocated to the original conspirators. 23. With one exception, DLA awarded the 2009 PC&S contracts in line with the allocations made by Jier Shin Korea and other co-conspirators. Hyundai Oilbank and Jier Shin Korea accidentally won one line item that the conspiracy had allocated to GS Caltex. To remedy this misallocation, Jier Shin Korea, Hyundai Oilbank, and GS Caltex agreed that GS Caltex, rather than Hyundai Oilbank, would supply Jier Shin Korea with the fuel procured under this line item. E:\FR\FM\17APN1.SGM 17APN1 21464 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices jbell on DSKJLSW7X2PROD with NOTICES 2013 PC&S Contracts 24. Similar to 2006 and 2009, Jier Shin Korea and other co-conspirators conspired to rig bids and fix prices for the 2013 PC&S contracts, which were issued in response to solicitation SP0600–12–R–0332. The term of the 2013 PC&S Contract covered the supply of fuel from August 2013 through July 2016. 25. Jier Shin Korea and other coconspirators communicated via phone calls and emails to allocate and set the price for each line item in the solicitation for the 2013 PC&S contracts. Jier Shin Korea and other coconspirators believed that they had an agreement as to their bidding strategy and pricing for the 2013 PC&S contracts. As a result of this agreement, they bid higher prices than they would have in a competitive process. 26. However, Hanjin and S-Oil submitted bids for the 2013 PC&S contracts below the prices set by the other co-conspirators. Although lower than the pricing agreed upon by the conspirators, Hanjin and S-Oil still submitted bids above a competitive, non-collusive price, knowing that they would likely win the contracts because the other conspirators would bid even higher prices. 27. As a result of their bidding strategy, Hanjin and S-Oil jointly won nearly all the line items in the 2013 PC&S contracts. As in 2009, S-Oil was to provide the fuel for these line items, and Hanjin was to provide transportation and logistics. Jier Shin Korea and other co-conspirators won a few, small line items; SK Energy won none. DLA made inflated payments under the 2013 PC&S contracts through October 2016. 28. After the award of the 2013 PC&S contracts, Hanjin, S-Oil, and GS Caltex reached an understanding that GS Caltex, rather than S-Oil, would supply Hanjin with fuel for certain line items. Under this side agreement, Hanjin paid a much lower price to GS Caltex for fuel than the price it previously had agreed to pay S-Oil to acquire fuel for those line items. However, the price that Hanjin paid to GS Caltex exceeded a competitive price for fuel. VI. Violations Alleged 29. The United States incorporates by reference the allegations in paragraphs 1 through 28. 30. The conduct of Defendants and their co-conspirators unreasonably restrained trade and harmed competition for the supply of fuel to the U.S. military in South Korea in violation of Section 1 of the Sherman Act, 15 U.S.C. 1. VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 31. The United States was injured as a result of the unlawful conduct because it paid more for the supply of fuel than it would have had Defendants and their co-conspirators engaged in fair competition. VII. Request for Relief 32. The United States requests that this Court: (a) Adjudge that Defendants’ and their co-conspirators’ conduct constitutes an unreasonable restraint of interstate commerce, import trade or commerce, and commerce with foreign nations in violation of Section 1 of the Sherman Act, 15 U.S.C. 1; (b) award the United States damages to which it is entitled for the losses incurred as the result of Defendants’ and their co-conspirators’ conduct; (c) award the United States equitable disgorgement of the ill-gotten gains obtained by Defendants; (d) award the United States its costs of this action; and (e) award the United States other relief that the Court deems just and proper. 303 Marconi Boulevard, Suite 200 Columbus, Ohio 43215 Tel: (614) 469–5715 Fax: (614) 469–2769 Email: Andrew.Malek@usdoj.gov United States District Court for the Southern District of Ohio Eastern Division United States of America,Plaintiff, v. Jier Shin Korea Co., Ltd. and Sang Joo Lee, Defendants. Case No. 2:20–cv–1788 Proposed Final Judgment as to Defendants Jier Shin Korea Co., Ltd. and Sang Joo Lee Whereas Plaintiff, United States of America, filed its Complaint on April 8, 2020, the United States and Defendants Jier Shin Korea Co., Ltd. (‘‘Jier Shin Korea’’) and Sang Joo Lee, by their respective attorneys, have consented to the entry of this Final Judgment without trial or adjudication of any issue of fact or law; Whereas, this Final Judgment does not constitute any evidence against or admission by any party regarding any issue of fact or law; Dated: April 8, 2020 Now, therefore, before the taking of Respectfully submitted, any testimony and without trial or final FOR PLAINTIFF UNITED STATES OF adjudication of any issue of fact or law AMERICA: herein, and upon consent of the parties /s/ lllllllllllllllllll hereto, it is hereby Ordered, Adjudged, Makan Delrahim, and Decreed: Assistant Attorney General for Antitrust. /s/ lllllllllllllllllll Bernard A. Nigro, Jr., Principal Deputy Assistant Attorney General. /s/ lllllllllllllllllll Kathleen S. O’Neill, Senior Director of Investigations and Litigation. /s/ lllllllllllllllllll Robert A. Lepore, Chief, Transportation, Energy & Agriculture Section. /s/ lllllllllllllllllll Katherine Celeste, Assistant Chief, Transportation, Energy & Agriculture Section. /s/ lllllllllllllllllll J. Richard Doidge, John A. Holler Attorneys for the United States, U.S. Department of Justice, Antitrust Division, 450 5th Street NW, Suite 8000, Washington, DC 20530, Tel: (202) 514–8944, Fax: (202) 616– 2441, Email: Dick.Doidge@usdoj.gov. I. Jurisdiction This Court has jurisdiction over the subject matter of this action and each of the parties. The Complaint states a claim upon which relief may be granted to the United States against Jier Shin Korea and Sang Joo Lee under Section 1 of the Sherman Act, 15 U.S.C. 1. II. Applicability This Final Judgment applies to Jier Shin Korea and Sang Joo Lee, as defined above, and all other persons in active concert or participation with any of them who receive actual notice of this Final Judgment by personal service or otherwise. III. Payments Jier Shin Korea and Sang Joo Lee jointly and severally shall pay to the United States the total sum of two Dated: April 8, 2020 million dollars ($2,000,000) over three installments: Respectfully submitted, (a) Within ten (10) business days of FOR PLAINTIFF UNITED STATES OF the entry of this Final Judgment, the AMERICA: amount of one million dollars DAVID M. DEVILLERS, ($1,000,000); United States Attorney. (b) within one (1) calendar year of the By: /s/ lllllllllllllllllll entry of this Final Judgment, the amount of five hundred thousand dollars Andrew M. Malek (Ohio Bar #0061442) ($500,000); and Assistant United States Attorney PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\17APN1.SGM 17APN1 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices IV. Cooperation jbell on DSKJLSW7X2PROD with NOTICES (c) within two (2) calendar years of the entry of this Final Judgment, the amount of five hundred thousand dollars ($500,000); less the amount paid (excluding any interest) pursuant to the settlement agreement attached hereto as Attachment 1. These payments satisfy all civil antitrust claims alleged against Jier Shin Korea and Sang Joo Lee by the United States in the Complaint. Payments of the amounts ordered hereby shall be made by wire transfer of funds or cashier’s check. If the payment is made by wire transfer, Jier Shin Korea and Sang Joo Lee shall contact Janie Ingalls of the Antitrust Division’s Antitrust Documents Group at (202) 514–2481 for instructions before making the transfer. If the payment is made by cashier’s check, the check shall be made payable to the United States Department of Justice and delivered to: Janie Ingalls, United States Department of Justice Antitrust Division, Antitrust Documents Group, 450 5th Street NW, Suite 1024, Washington, DC 20530. In the event of a default in payment, interest at the rate of eighteen (18) percent per annum shall accrue thereon from the date of default to the date of payment. Jier Shin and Sang Joo Lee have provided sworn financial disclosure statements (‘‘Financial Statements’’) to the United States and the United States has relied on the accuracy and completeness of those Financial Statements in agreeing to this Final Judgment. Jier Shin and Sang Joo Lee warrant that the Financial Statements are complete, accurate, and current. If the United States learns of any asset(s) in which Jier Shin and Sang Joo Lee had an interest as of April 8, 2020 that were not disclosed in the Financial Statements, or if the United States learns of any misrepresentation by Jier Shin and Sang Joo Lee on, or in connection with, the Financial Statements, and if such nondisclosure or misrepresentation changes the estimated net worth set forth in the Financial Statements by $100,000 or more, the United States may collect the full payments set forth in this section plus one hundred percent (100%) of the value of the net worth of Jier Shin and Sang Joo Lee previously undisclosed. Jier Shin and Sang Joo Lee agree not to contest any collection action undertaken by the United States pursuant to this provision, and immediately to pay the United States all reasonable costs incurred in such an action, including attorney’s fees and expenses. VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 Jier Shin Korea and Sang Joo Lee shall cooperate fully with the United States regarding any matter about which they have knowledge or information relating to any ongoing civil investigation, litigation, or other proceeding arising out of any ongoing federal investigation of the subject matter discussed in the Complaint (hereinafter, any such investigation, litigation, or proceeding shall be referred to as a ‘‘Civil Federal Proceeding’’). The United States agrees that any cooperation provided pursuant to the settlement agreement attached hereto as Attachment 1 will be considered cooperation for purposes of this Final Judgment, and the United States will use its reasonable best efforts, where appropriate, to coordinate any requests for cooperation in connection with the Civil Federal Proceeding with requests for cooperation in connection with the settlement agreement attached hereto as Attachment 1, so as to avoid unnecessary duplication and expense. Jier Shin Korea and Sang Joo Lee’s cooperation shall include, but not be limited to, the following: (a) Upon request, completely and truthfully disclosing and producing, to the offices of the United States and at no expense to the United States, copies of all non-privileged information, documents, materials, and records in their possession (and for any foreignlanguage information, documents, materials, or records, copies must be produced with an English translation), regardless of their geographic location, about which the United States may inquire in connection with any Civil Federal Proceeding, including but not limited to all information about activities of Jier Shin Korea and present and former officers, directors, employees, and agents of Jier Shin Korea; (b) Making available in the United States, at no expense to the United States, Jier Shin Korea’s present officers, directors, employees, and agents to provide information and/or testimony as requested by the United States in connection with any Civil Federal Proceeding, including the provision of testimony in trial and other judicial proceedings, as well as interviews with law enforcement authorities, consistent with the rights and privileges of those individuals; (c) Using their best efforts to make available in the United States, at no expense to the United States, Jier Shin Korea’s former officers, directors, employees, and agents to provide information and/or testimony as PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 21465 requested by the United States in connection with any Civil Federal Proceeding, including the provision of testimony in trial and other judicial proceedings, as well as interviews with law enforcement authorities, consistent with the rights and privileges of those individuals; (d) Providing testimony or information necessary to identify or establish the original location, authenticity, or other basis for admission into evidence of documents or physical evidence produced by Jier Shin Korea or Sang Joo Lee in any Civil Federal Proceeding as requested by the United States; and (e) Completely and truthfully responding to all other inquiries of the United States in connection with any Civil Federal Proceeding. However, notwithstanding any provision of this Final Judgment, Jier Shin Korea and Sang Joo Lee are not required to: (1) Request of Jier Shin Korea’s current or former officers, directors, employees, or agents that they forgo seeking the advice of an attorney nor that they act contrary to that advice; (2) take any action against Jier Shin Korea’s officers, directors, employees, or agents for following their attorney’s advice; or (3) waive any claim of privilege or work product protection. The obligations of Jier Shin Korea and Sang Joo Lee to cooperate fully with the United States as described in this Section shall cease upon the conclusion of all Civil Federal Proceedings (which may include Civil Federal Proceedings related to the conduct of third parties), including exhaustion of all appeals or expiration of time for all appeals of any Court ruling in each such Civil Federal Proceeding, at which point the United States will provide written notice to Jier Shin Korea and Sang Joo Lee that their obligations under this Section have expired. V. Antitrust Compliance Program A. Within thirty (30) days after entry of this Final Judgment, Jier Shin Korea shall appoint an Antitrust Compliance Officer and identify to the United States his or her name, business address, telephone number, and email address. Within forty-five (45) days of a vacancy in the Antitrust Compliance Officer position, Jier Shin Korea shall appoint a replacement, and shall identify to the United States the Antitrust Compliance Officer’s name, business address, telephone number, and email address. Jier Shin Korea’s initial or replacement appointment of an Antitrust Compliance Officer is subject to the approval of the United States, in its sole discretion. E:\FR\FM\17APN1.SGM 17APN1 21466 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices B. The Antitrust Compliance Officer shall institute an antitrust compliance program for Jier Shin Korea’s employees and directors. The antitrust compliance program shall provide at least two hours of training annually on the antitrust laws of the United States, such training to be delivered by an attorney with relevant experience in the field of United States antitrust law. C. Each Antitrust Compliance Officer shall obtain, within six months after entry of this Final Judgment, and on an annual basis thereafter, on or before each anniversary of the entry of this Final Judgment, from each person subject to Paragraph V.B of this Final Judgment, and thereafter maintaining, a certification that each such person has received the required two hours of annual antitrust training. D. Each Antitrust Compliance Officer shall communicate annually to all Jier Shin Korea employees that they may disclose to the Antitrust Compliance Officer, without reprisal, information concerning any potential violation of the United States antitrust laws. E. Each Antitrust Compliance Offer shall provide to the United States within six months after entry of this Final Judgment, and on an annual basis thereafter, on or before each anniversary of the entry of this Final Judgment, a written statement as to the fact and manner of Jier Shin Korea’s compliance with Section V of this Final Judgment. VI. Retention of Jurisdiction This Court retains jurisdiction to enable any of the parties to this Final Judgment to apply to this Court at any time for further orders and directions as may be necessary or appropriate to carry out or construe this Final Judgment, to modify or terminate any of its provisions, to enforce compliance, and to punish violations of its provisions. jbell on DSKJLSW7X2PROD with NOTICES VII. Enforcement of Final Judgment A. The United States retains and reserves all rights to enforce the provisions of this Final Judgment, including the right to seek an order of contempt from the Court. Jier Shin Korea and Sang Joo Lee agree that in any civil contempt action, any motion to show cause, or any similar action brought by the United States regarding an alleged violation of this Final Judgment, the United States may establish a violation of the decree and the appropriateness of any remedy therefor by a preponderance of the evidence, and Jier Shin Korea and Sang Joo Lee waive any argument that a different standard of proof should apply. VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 B. The Final Judgment should be interpreted to give full effect to the procompetitive purposes of the antitrust laws and to restore all competition the United States alleged was harmed by the challenged conduct. Jier Shin Korea and Sang Joo Lee agree that they may be held in contempt of, and that the Court may enforce, any provision of this Final Judgment that, as interpreted by the Court in light of these procompetitive principles and applying ordinary tools of interpretation, is stated specifically and in reasonable detail, whether or not it is clear and unambiguous on its face. In any such interpretation, the terms of this Final Judgment should not be construed against either party as the drafter. C. In any enforcement proceeding in which the Court finds that Jier Shin Korea or Sang Joo Lee has violated this Final Judgment, the United States may apply to the Court for a one-time extension of this Final Judgment, together with such other relief as may be appropriate. In connection with any successful effort by the United States to enforce this Final Judgment against Jier Shin Korea or Sang Joo Lee, whether litigated or resolved prior to litigation, Jier Shin Korea and Sang Joo Lee agree to reimburse the United States for the fees and expenses of its attorneys, as well as any other costs including experts’ fees, incurred in connection with that enforcement effort, including in the investigation of the potential violation. VIII. Expiration of Final Judgment Unless this Court grants an extension, this Final Judgment shall expire seven (7) years from the date of its entry, except that after five (5) years from the date of its entry, this Final Judgment may be terminated upon notice by the United States to the Court, Jier Shin Korea, and Sang Joo Lee that the continuation of the Final Judgment no longer is necessary or in the public interest. IX. Public Interest Determination Entry of this Final Judgment is in the public interest. The parties have complied with the requirements of the Antitrust Procedures and Penalties Act, 15 U.S.C. 16, including making copies available to the public of this Final Judgment, the Competitive Impact Statement, and any comments thereon and the United States’ responses to comments. Based upon the record before the Court, which includes the Competitive Impact Statement and any comments and response to comments filed with the Court, entry of this Final Judgment is in the public interest. PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 DATED: llllllllllllllll llllllllllllllllllll United States District Judge Attachment 1 Settlement Agreement This Settlement Agreement (Agreement) is entered into among the United States of America, acting through the Civil Division of the United States Department of Justice and the United States Attorney’s Office for the Southern District of Ohio, on behalf of the Defense Logistics Agency (DLA) and the Army and Air Force Exchange Service (AAFES) (collectively the ‘‘United States’’), Jier Shin Korea (Jier Shin) and Sang Joo Lee, and Relator [REDACTED] (hereafter collectively referred to as ‘‘the Parties’’), through their authorized representatives. Recitals A. Jier Shin is a South Korea-based logistics company. Sang Joo Lee is the President of Jier Shin and a shareholder. B. On February 28, 2018, Relator, a resident and citizen of South Korea, filed a qui tam action in the United States District Court for the Southern District of Ohio captioned United States ex rel. [REDACTED] v. GS Caltex, et al., Civil Action No. [REDACTED], pursuant to the qui tam provisions of the False Claims Act, 31 U.S.C. 3730(b) (the Civil FCA Action). Relator contends that Jier Shin conspired with other South Korean entities to rig bids on Department of Defense contracts to supply fuel to U.S. military bases throughout South Korea beginning in 2005 and continuing until 2016, including DLA Post, Camps, and Stations contracts executed in 2006, 2009, 2011, and 2013, and AAFES contracts executed in 2008. C. Jier Shin and Sang Joo Lee will execute a Stipulation with the Antitrust Division of the United States Department of Justice in which Jier Shin and Sang Joo Lee will consent to the entry of a Final Judgment to be filed in United States v. Jier Shin Korea, Civil Action No. [to be assigned] (S.D. Ohio) (the Civil Antitrust Action) that will settle any and all civil antitrust claims of the United States against Jier Shin and Sang Joo Lee arising from any act or offense committed before the date of the Stipulation that was undertaken in furtherance of an attempted or completed antitrust conspiracy involving PC&S and/or AAFES fuel supply contracts with the U.S. military in South Korea during the period 2005 through 2016. D. The United States contends that it has certain civil claims against Jier Shin and Sang Joo Lee arising from a E:\FR\FM\17APN1.SGM 17APN1 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices jbell on DSKJLSW7X2PROD with NOTICES conspiracy among South Korean entities to rig bids on Department of Defense contracts to supply fuel to U.S. military bases throughout South Korea beginning in 2005 and continuing to 2016, including DLA Post, Camps, and Stations contracts executed in 2006, 2009, 2011, and 2013, and AAFES contracts executed in 2008. The conduct described in in this Paragraph, as well as the conduct, actions, and claims alleged by Relator in the Civil FCA Action is referred to below as the Covered Conduct. E. This Settlement Agreement is neither an admission of liability by Jier Shin and Sang Joo Lee nor a concession by the United States or Relator that their claims are not well founded. F. Relator claims entitlement under 31 U.S.C. 3730(d) to a share of the proceeds of this Settlement Agreement and to Relator’s reasonable expenses, attorneys’ fees, and costs. To avoid the delay, uncertainty, inconvenience, and expense of protracted litigation of the above claims, and in consideration of the mutual promises and obligations of this Settlement Agreement, the Parties agree and covenant as follows: Terms and Conditions 1. Jier Shin and Sang Joo Lee jointly and severally agree to pay to the United States five hundred thousand dollars ($500,000) by electronic funds transfer no later than ten (10) business days after the Effective Date of this Agreement pursuant to written instructions to be provided by the Civil Division of the United States Department of Justice (Initial Payment). Jier Shin and Sang Joo Lee jointly and severally agree to pay to the United States five-hundred thousand dollars ($500,000) by electronic funds transfer no later than sixty (60) days after the Effective Date of this Agreement (Second Payment). Jier Shin and Sang Joo Lee jointly and severally agree to pay to the United States five-hundred thousand dollars ($500,000) by electronic funds transfer no later than one (1) year after the Effective Date of this Agreement (Third Payment). Jier Shin and Sang Joo Lee jointly and severally agree to pay to the United States five-hundred thousand dollars ($500,000) by electronic funds transfer no later than two (2) years after the Effective Date of this Agreement (Final Payment). The sum of the Initial Payment, Second Payment, Third Payment, and Final Payment shall constitute the FCA Settlement Amount. Relator claims entitlement under 31 U.S.C. 3730(d) to Relator’s reasonable expenses, attorneys’ fees and costs. The FCA Settlement Amount does not VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 include the Relator’s fees and costs, and Jier Shin and Sang Joo Lee acknowledge (without waiving any applicable arguments or defenses) that Relator retains all rights to seek to recover such expenses, attorneys’ fees, and costs from Jier Shin pursuant to 31 U.S.C. 3730(d). 2. Subject to the exceptions in Paragraph 4 (concerning excluded claims) below, and conditioned upon Jier Shin and Sang Joo Lee’s full payment of the FCA Settlement Amount, the United States releases Sang Joo Lee and Jier Shin together with its current and former parent corporations; direct and indirect subsidiaries; brother or sister corporations; divisions; current or former corporate owners; and the corporate successors and assigns of any of them from any civil or administrative monetary claim the United States has for the Covered Conduct under the False Claims Act, 31 U.S.C. 3729–3733; the Program Fraud Civil Remedies Act, 31 U.S.C. 3801–3812; Contract Disputes Act, 41 U.S.C. 7101–7109; or the common law theories of breach of contract, payment by mistake, unjust enrichment, and fraud. 3. Except as set forth in Paragraph 1 (concerning Relator’s claims under 31 U.S.C. 3730(d)), and subject to the exceptions in Paragraph 4 below, and conditioned upon Sang Joo Lee and Jier Shin’s full payment of the FCA Settlement Amount, Relator, on behalf of: (a) His respective heirs, successors, assigns, agents and attorneys; and (b) his companies, [REDACTED], together with their direct and indirect subsidiaries, brother or sister corporations, divisions, current or former corporate owners, and the corporate successors and assigns of any of them); hereby fully and finally releases, waives, and forever discharges Sang Joo Lee and Jier Shin, together with its direct and indirect subsidiaries, brother or sister corporations, divisions, current or former corporate owners, and the corporate successors and assigns of any of them, from: (i) Any civil monetary claim Relator has on behalf of the United States for the Covered Conduct under the False Claims Act, 31 U.S.C. 3729–3733; (ii) any claims or allegations Relator has asserted or could have asserted against Sang Joo Lee and Jier Shin arising from the Covered Conduct; and (iii) all liability, claims, demands, actions or causes of action whatsoever, whether known or unknown, fixed or contingent, in law or in equity, in contract or in tort, under any federal, Korean, or state statute or regulation or otherwise, or in common law, including claims for attorneys’ fees, costs, and expenses of every kind and however denominated, that Relator would have standing to bring or which PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 21467 Relator may now have or claim to have against Sang Joo Lee and Jier Shin and/ or its direct and indirect subsidiaries, brother or sister corporations, divisions, current or former corporate owners, and the corporate successors and assigns of any of them. 4. Notwithstanding the releases given in paragraphs 2 and 3 of this Agreement, or any other term of this Agreement, the following claims of the United States are specifically reserved and are not released: a. Any liability arising under Title 26, U.S. Code (Internal Revenue Code); b. Any criminal liability; c. Except as explicitly stated in this Agreement, any administrative liability, including the suspension and debarment rights of any federal agency; d. Any liability to the United States (or its agencies) for any conduct other than the Covered Conduct; e. Any liability based upon obligations created by this Agreement; f. Any liability of individuals other than Sang Joo Lee; g. Any liability for express or implied warranty claims or other claims for defective or deficient products or services, including quality of goods and services; h. Any liability for failure to deliver goods or services due; and i. Any liability for personal injury or property damage or for other consequential damages arising from the Covered Conduct. 5. Relator and his heirs, successors, attorneys, agents, and assigns shall not object to this Agreement but agree and confirm that this Agreement is fair, adequate, and reasonable under all the circumstances, pursuant to 31 U.S.C. 3730(c)(2)(B). In connection with this Agreement and this Civil FCA Action, Relator, on behalf of himself and his heirs, successors, attorneys, agents, and assigns, agrees that neither this Agreement, nor any intervention by the United States in the Civil FCA Action in order to dismiss the Civil FCA Action, nor any dismissal of the Civil FCA Action, shall waive or otherwise affect the ability of the United States to contend that provisions in the False Claims Act, including 31 U.S.C. 3730(d)(3), bar Relator from sharing in the proceeds of this Agreement, except that the United States will not contend that Relator is barred from sharing in the proceeds of this agreement under 31 U.S.C. 3730(e)(4). Moreover, the United States and Relator, on behalf of himself and his heirs, successors, attorneys, agents, and assigns agree that they each retain all of their rights pursuant to the False Claims Act on the issue of the share percentage, if any, that Relator E:\FR\FM\17APN1.SGM 17APN1 jbell on DSKJLSW7X2PROD with NOTICES 21468 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices should receive of any proceeds of the settlement of his claims, and that no agreements concerning Relator share have been reached to date. 6. Jier Shin and Sang Joo Lee waive and shall not assert any defenses Jier Shin and Sang Joo Lee may have to any criminal prosecution or administrative action relating to the Covered Conduct that may be based in whole or in part on a contention that, under the Double Jeopardy Clause in the Fifth Amendment of the Constitution, or under the Excessive Fines Clause in the Eighth Amendment of the Constitution, this Agreement bars a remedy sought in such criminal prosecution or administrative action. 7. Jier Shin and Sang Joo Lee fully and finally release the United States, its agencies, officers, agents, employees, and servants, from any claims (including attorney’s fees, costs, and expenses of every kind and however denominated) that Jier Shin and Sang Joo Lee have asserted, could have asserted, or may assert in the future against the United States, its agencies, officers, agents, employees, and servants, related to the Covered Conduct and the United States’ investigation and prosecution thereof. 8. Sang Joo Lee and Jier Shin, together with its direct and indirect subsidiaries, brother or sister corporations, divisions, current or former corporate owners, and the corporate successors and assigns of any of them, hereby fully and finally releases, waives, and forever discharges the Relator, together with his respective heirs, successors, assigns, agents and attorneys, and his companies ([REDACTED]) from any claims or allegations Jier Shin or Sang Joo Lee has asserted or could have asserted, arising from the Covered Conduct, and from all liability, claims, demands, actions or causes of action whatsoever arising from or in any manner related to the Covered Conduct, whether known or unknown, fixed or contingent, in law or in equity, in contract or in tort, under any federal, Korean, or state statute or regulation or otherwise, or in common law, including claims for attorneys’ fees, costs, and expenses of every kind and however denominated, that it would have standing to bring or which Jier Shin or Sang Joo Lee may now have or claim to have against Relator and his heirs, successors, assigns, agents, and attorneys. 9. a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 CFR 31.205– 47) incurred by or on behalf of Sang Joo Lee and Jier Shin, and its present or former officers, directors, employees, VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 shareholders, and agents in connection with: (1) The matters covered by this Agreement and any related civil antitrust agreement; (2) the United States’ audit(s) and civil and any criminal investigation(s) of the matters covered by this Agreement; (3) Sang Joo Lee and Jier Shin’s investigation, defense, and corrective actions undertaken in response to the United States’ audit(s) and civil and any criminal investigation(s) in connection with the matters covered by this Agreement (including attorney’s fees); (4) the negotiation and performance of this Agreement and any related civil antitrust agreement; (5) the payments that Sang Joo Lee and Jier Shin make to the United States pursuant to this Agreement and any payments that Jier Shin may make to Relator, including costs and attorneys’ fees, are unallowable costs for government contracting purposes (hereinafter referred to as Unallowable Costs). b. Future Treatment of Unallowable Costs: Unallowable Costs will be separately determined and accounted for by Sang Joo Lee and Jier Shin, and Sang Joo Lee and Jier Shin shall not charge such Unallowable Costs directly or indirectly to any contract with the United States. c. Treatment of Unallowable Costs Previously Submitted for Payment: Within 90 days of the Effective Date of this Agreement, Sang Joo Lee and Jier Shin shall identify and repay by adjustment to future claims for payment or otherwise any Unallowable Costs included in payments previously sought by Sang Joo Lee and Jier Shin or any of its subsidiaries or affiliates from the United States. Sang Joo Lee and Jier Shin agree that the United States, at a minimum, shall be entitled to recoup from Jier Shin any overpayment plus applicable interest and penalties as a result of the inclusion of such Unallowable Costs on previouslysubmitted requests for payment. The United States, including the Department of Justice and/or the affected agencies, reserves its rights to audit, examine, or re-examine Jier Shin’s books and records and to disagree with any calculations submitted by Jier Shin or any of its subsidiaries or affiliates regarding any Unallowable Costs included in payments previously sought by Jier Shin, or the effect of any such Unallowable Costs on the amount of such payments. 10. Jier Shin and Sang Joo Lee have provided sworn financial disclosure statements (Financial Statements) to the PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 United States and the United States has relied on the accuracy and completeness of those Financial Statements in reaching this Agreement. Jier Shin and Sang Joo Lee warrant that the Financial Statements are complete, accurate, and current. If the United States learns of asset(s) in which Jier Shin and Sang Joo Lee had an interest at the time of this Agreement that were not disclosed in the Financial Statements, or if the United States learns of any misrepresentation by Jier Shin and Sang Joo Lee on, or in connection with, the Financial Statements, and if such nondisclosure or misrepresentation changes the estimated net worth set forth in the Financial Statements by $100,000 or more, the United States may at its option: (a) Rescind this Agreement and file suit based on the Covered Conduct, or (b) let the Agreement stand and collect the full Settlement Amount plus one hundred percent (100%) of the value of the net worth of Jier Shin and Sang Joo Lee previously undisclosed. Jier Shin and Sang Joo Lee agree not to contest any collection action undertaken by the United States pursuant to this provision, and immediately to pay the United States all reasonable costs incurred in such an action, including attorney’s fees and expenses. The United States agrees to notify Relator if the United States invokes either of its options pursuant to this paragraph. Nothing in this agreement shall be interpreted as a waiver of Relator’s right to request a share of any proceeds collected by the United States pursuant to this paragraph. 11. In the event that the United States, pursuant to Paragraph 10 (concerning disclosure of assets), above, opts to rescind this Agreement, Jier Shin and Sang Joo Lee agree not to plead, argue, or otherwise raise any defenses under the theories of statute of limitations, laches, estoppel, or similar theories, to any civil or administrative claims that (a) are filed by the United States within 60 calendar days of written notification to Jier Shin and Sang Joo Lee that this Agreement has been rescinded, and (b) relate to the Covered Conduct, except to the extent these defenses were available on the Effective Date of this Agreement. 12. Sang Joo Lee and Jier Shin agree to cooperate fully and truthfully with the United States in connection with the Civil FCA Action. Sang Joo Lee and Jier Shin’s ongoing, full, and truthful cooperation shall include, but not be limited to: a. Upon request by the United States with reasonable notice, producing at the offices of counsel for the United States in Washington, DC and not at the expense of the United States, complete E:\FR\FM\17APN1.SGM 17APN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices and un-redacted copies of all nonprivileged documents related to the Covered Conduct wherever located in Sang Joo Lee and Jier Shin’s possession, custody, or control, including but not limited to, reports, memoranda of interviews, and records concerning any investigation of the Covered Conduct that Sang Joo Lee and Jier Shin have undertaken, or that has been performed by another on Sang Joo Lee and Jier Shin’s behalf; b. upon request by the United States with reasonable notice, making Hyun Dae Shin, Sang Joo Lee, and current Jier Shin directors, officers, and employees available for interviews, consistent with the rights and privileges of such individuals, by counsel for the United States and/or their investigative agents, not at the expense of the United States, in the United States or Taiwan, unless another place is mutually agreed upon; c. upon request by the United States with reasonable notice, (i) using best efforts to assist in locating former Jier Shin directors, officers, and employees identified by attorneys and/or investigative agents of the United States, and (ii) using best efforts to make any such former Jier Shin directors, officers, and employees available for interviews, consistent with the rights and privileges of such individuals, by counsel for the United States and/or their investigative agents, not at the expense of the United States, in the United States or Taiwan, unless another place is mutually agreed upon; and d. upon request by the United States with reasonable notice, making Hyun Dae Shin, Sang Joo Lee, and current Jier Shin directors, officers, and employees available, and using best efforts to make former Jier Shin directors, officers, employees available, to testify, consistent with the rights and privileges of such individuals, fully, truthfully, and under oath, without falsely implicating any person or withholding any information, (i) at depositions in the United States, Taiwan, or any other mutually agreed upon place, (ii) at trial in the United States, (iii) at any other judicial proceedings wherever located related to the Civil FCA Action, and (iv) by declaration or affidavit executed in compliance with 28 U.S.C. 1746. 13. This Agreement is intended to be for the benefit of the Parties only. 14. Upon receipt of the Initial Payment of the FCA Settlement Amount described in Paragraph 1 above, the United States and Relator shall promptly sign and file a Joint Stipulation of Dismissal, with prejudice, of the claims filed against Jier Shin in the Civil FCA Action, pursuant to Rule 41(a)(1), which dismissal shall be VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 subject to the terms of this Agreement, including full payment of the FCA Settlement Amount, and conditioned on the Court retaining jurisdiction over Relator’s claims to a relator’s share and recovery of attorneys’ fees and costs pursuant to 31 U.S.C. 3730(d). 15. Except with respect to payment (if any) by Jier Shin of Relator’s attorneys’ fees, expenses, and costs pursuant to 31 U.S.C. 3730(d), each Party shall bear its own legal and other costs incurred in connection with this matter. The Parties agree that Relator, Jier Shin, and Sang Joo Lee will not seek to recover from the United States any costs or fees related to the preparation and performance of this Agreement. 16. Each party and signatory to this Agreement represents that it freely and voluntarily enters in to this Agreement without any degree of duress or compulsion. 17. This Agreement is governed by the laws of the United States. The exclusive jurisdiction and venue for any dispute relating to this Agreement is the United States District Court for the Southern District of Ohio. Jier Shin and Sang Joo Lee agree that the United States District Court for the Southern District of Ohio has jurisdiction over it for purposes of this Agreement. For purposes of construing this Agreement, this Agreement shall be deemed to have been drafted by all Parties to this Agreement and shall not, therefore, be construed against any Party for that reason in any subsequent dispute. 18. This Agreement constitutes the complete agreement between the Parties on the subject matters addressed herein. This Agreement may not be amended except by written consent of the Parties. 19. The undersigned counsel represent and warrant that they are fully authorized to execute this Agreement on behalf of the persons and entities indicated below. 20. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same Agreement. 21. This Agreement is binding on Sang Joo Lee and Jier Shin’s successors, transferees, heirs, and assigns. 22. This Agreement is binding on Relator’s successors, transferees, heirs, and assigns. 23. All parties consent to the United States’ disclosure of this Agreement, and information about this Agreement, to the public, as permitted by order of the Court. This Agreement shall not be released in un-redacted form until the Court unseals the entire Civil FCA Action. 24. This Agreement is effective on the date of signature of the last signatory to PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 21469 the Agreement (Effective Date of this Agreement). Facsimiles of signatures shall constitute acceptable, binding signatures for purposes of this Agreement. THE UNITED STATES OF AMERICA Dated: lllllllllllllllll By: lllllllllllllllllll Andrew A. Steinberg, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice. Dated: lllllllllllllllll By: lllllllllllllllllll Mark T. D’Alessandro, Civil Chief. Andrew Malek, Assistant United States Attorney, U.S. Attorney’s Office for the Southern District of Ohio. JIER SHIN KOREA Dated: lllllllllllllllll By: lllllllllllllllllll Sang Joo Lee, Authorized Representative of Jier Shin Korea. Dated: lllllllllllllllll By: lllllllllllllllllll Mark Rosman, Counsel for Jier Shin Korea. SANG JOO LEE Dated: lllllllllllllllll By: lllllllllllllllllll Sang Joo Lee Dated: lllllllllllllllll By: lllllllllllllllllll Mark Rosman, Counsel for Sang Joo Lee. RELATOR [REDACTED] Dated: lllllllllllllllll By: lllllllllllllllllll [REDACTED] Dated: lllllllllllllllll By: lllllllllllllllllll Eric R. Havian, Constantine Cannon LLP, Counsel for Relator. United States District Court for the Southern District of Ohio Eastern Division United States of America, Plaintiff, v. Jier Shin Korea Co., Ltd., and Sang Joo Lee, Defendants. Case No. 2:20–cv–1788 Competitive Impact Statement The United States of America, under Section 2(b) of the Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b)–(h) (the ‘‘APPA’’ or ‘‘Tunney Act’’), files this Competitive Impact Statement relating to the proposed Final Judgment submitted for entry in this civil antitrust proceeding. I. Nature and Purpose of the Proceeding On April 8, 2020, the United States filed a civil antitrust complaint against E:\FR\FM\17APN1.SGM 17APN1 21470 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices Defendants Jier Shin Korea Co., Ltd. (‘‘Jier Shin Korea’’) and Sang Joo Lee alleging that Defendants violated Section 1 of the Sherman Act, 15 U.S.C. 1. From at least March 2005 and continuing until at least October 2016 (‘‘the Relevant Period’’), Defendants and their co-conspirators conspired to fix prices and rig bids for the supply of fuel to the U.S. military for its operations in South Korea. As a result of this illegal conduct, Defendants and their coconspirators overcharged American taxpayers by well over $100 million. At the same time the Complaint was filed, the United States also filed an agreed-upon proposed Final Judgment that would remedy Defendants’ violation by having Jier Shin Korea and Sang Joo Lee jointly and severally pay $2,000,000 to the United States. This payment resolves the civil claims of the United States against Defendants related to the conduct described in the Complaint. The United States and Defendants have stipulated that the proposed Final Judgment may be entered after compliance with the APPA. Entry of the proposed Final Judgment will terminate this action, except that the Court will retain jurisdiction to construe, modify, or enforce the provisions of the proposed Final Judgment and to punish violations thereof. II. Description of the Events Giving Rise to the Alleged Violation jbell on DSKJLSW7X2PROD with NOTICES A. Defendants Jier Shin Korea is a small, privately held logistics company located in Seoul, South Korea. Sang Joo Lee is the president of Jier Shin Korea. Jier Shin Korea is a closely held firm majority owned by Lee and his family. Jier Shin Korea provides logistics services related to the transportation of fuel, petroleum by-products, and other goods. During the conspiracy, Jier Shin Korea partnered with a South Korean oil refiner, Hyundai Oilbank Co., Ltd. (‘‘Hyundai Oilbank’’), to supply fuel to U.S. military installations in South Korea, with Jier Shin Korea acting as the prime contractor under the relevant contracts. Other persons, not named as defendants in this action, participated as co-conspirators in the violation alleged in the Complaint and performed acts and made statements in furtherance thereof. These co-conspirators included, among others, GS Caltex Corporation (‘‘GS Caltex’’), Hanjin Transportation Co., Ltd. (‘‘Hanjin’’), SK Energy Co., Ltd. (‘‘SK Energy’’), Hyundai Oilbank, and SOil Corporation (‘‘S-Oil’’). VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 On December 12, 2018, GS Caltex, Hanjin, and SK Energy pleaded guilty to an information charging a criminal violation of Section 1 of the Sherman Act for this unlawful conduct. See United States v. GS Caltex Corporation, No. 2:18–cr–240 (S.D. Ohio, filed November 14, 2018); United States v. Hanjin Transportation Co., Ltd., No. 2:18–cr–241 (S.D. Ohio, filed November 14, 2018); United States v. SK Energy Company, No. 2:18–cr–239 (S.D. Ohio, filed November 14, 2018). GS Caltex, Hanjin, and SK Energy have also settled civil claims brought by the United States in a separately filed civil action relating to the same conduct. See United States v. GS Caltex Corp. et al., No. 2:18–cv–1456 (S.D. Ohio, filed November 14, 2018). On March 20, 2019, Hyundai Oilbank and S-Oil pleaded guilty to Count One of a Superseding Indictment charging a criminal violation of Section 1 of the Sherman Act for this unlawful conduct. See United States v. Kim et al., No. 2:18–cr–152 (S.D. Ohio, filed September 27, 2018). Hyundai Oilbank and S-Oil have also settled civil claims brought by the United States in a separately filed civil action relating to the same conduct. See United States v. Hyundai Oilbank and S-Oil Corp., No. 2:19–cv– 01037 (S.D. Ohio, filed March 20, 2019). B. PC&S and AAFES Contracts The United States military procures fuel for its installations in South Korea through competitive solicitation processes. Oil companies, either independently or with a transportation company, submitted bids in response to these solicitations. The conduct at issue in this action relates to two types of contracts to supply fuel to the U.S. military in South Korea: Post, Camps, and Stations (‘‘PC&S’’) contracts and Army and Air Force Exchange Services (‘‘AAFES’’) contracts. PC&S contracts are issued and administered by the Defense Logistics Agency (‘‘DLA’’), a combat support agency of the U.S. Department of Defense. The fuel procured under PC&S contracts is used to power military vehicles and heat U.S. military buildings. During the Relevant Period, DLA issued PC&S solicitations listing the fuel requirements for installations across South Korea, with each delivery location identified by a separate line item. Bidders submitted initial bids, offering a price for each line item on which they chose to bid. After DLA reviewed the initial bids, bidders were allowed to submit revised final bids. DLA reviewed the bids and awarded contracts to the bidders offering the PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 lowest price for each line item. Payments under the PC&S contracts were wired to the awardees by a finance and accounting agency of the U.S. Department of Defense from its office in Columbus, Ohio. AAFES is an agency of the Department of Defense headquartered in Dallas, Texas. AAFES operates official retail stores (known as ‘‘exchanges’’) on U.S. Army and Air Force installations worldwide, which U.S. military personnel and their families use to purchase everyday goods and services, including gasoline for use in their personal vehicles. AAFES procures fuel for these stores via contracts awarded through a competitive solicitation process. In 2008, AAFES issued a solicitation that listed the fuel requirements for installations in South Korea. Bidders submitted bids offering a price for each line item in the solicitation. Unlike DLA, AAFES awarded the entire 2008 contract to the bidder offering the lowest price across all the listed locations. C. The Alleged Violation The Complaint alleges that Defendants and their co-conspirators engaged in a series of meetings, telephone conversations, emails, and other communications to rig bids and fix prices for the supply of fuel to U.S. military installations in South Korea under several PC&S and AAFES contracts. First, the Complaint alleges that GS Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea (including by, through, and with the knowledge of, its president Sang Joo Lee) conspired to rig bids and fix prices on the contracts issued in response to DLA solicitations SP0600–05–R–0063 and SP0600–05–R– 0063–0001 (‘‘2006 PC&S contracts’’). The term of the 2006 PC&S contracts covered the supply of fuel from February 2006 through July 2009. The Complaint alleges that between early 2005 and mid-2006, GS Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea met multiple times and exchanged phone calls and emails to allocate the line items in the solicitations for the 2006 PC&S contracts. Through such communications, these conspirators agreed to inflate their bids to produce larger profit margins. For each line item allocated to a different co-conspirator, the other conspirators agreed not to bid or to bid high enough to ensure that they would not win that item. DLA awarded the 2006 PC&S line items according to the allocations made by the conspiracy. E:\FR\FM\17APN1.SGM 17APN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices Second, the Complaint alleges that, as part of their discussions related to the 2006 PC&S contracts, GS Caltex, Hyundai Oilbank, and Jier Shin Korea agreed not to compete with SK Energy in bidding for the June 2008 AAFES solicitation (‘‘2008 AAFES contract’’). The initial term of the 2008 AAFES contract ran from July 2008 to July 2010; the contract was later extended through July 2013. Third, the Complaint alleges that Jier Shin Korea and other co-conspirators conspired to rig bids and fix prices for the contracts issued in response to DLA solicitation SP0600–08–R–0233 (‘‘2009 PC&S contracts’’). Hanjin and S-Oil joined the conspiracy for the purpose of bidding on SP0600–08–R–0233. The term of the 2009 PC&S contracts covered the supply of fuel from October 2009 through August 2013. The Complaint explains that between late 2008 and mid-2009, Jier Shin Korea and other co-conspirators met multiple times and exchanged phone calls and emails to allocate the line items in the solicitation for the 2009 PC&S contracts. As in 2006, these conspirators agreed to bid high so as to not win line items allocated to other co-conspirators. The original conspirators agreed to allocate to Hanjin and S-Oil certain line items that had previously been allocated to the original conspirators. Finally, the Complaint alleges that Jier Shin Korea and other co-conspirators once again conspired to rig bids and fix prices for the contracts issued in response to DLA solicitation SP0600– 12–R–0332 (‘‘2013 PC&S contracts’’). The term of the 2013 PC&S contracts covered the supply of fuel from August 2013 through July 2016. The Complaint explains that Jier Shin Korea and other co-conspirators communicated via phone calls and emails to allocate and set the price for each line item in the solicitation for the 2013 PC&S contracts. Jier Shin Korea and other co-conspirators believed that they had an agreement as to their bidding strategy and pricing for the 2013 PC&S contracts. As a result of this agreement, they submitted bids with pricing above what they would have offered absent collusion. Hanjin and S-Oil submitted bids for the 2013 PC&S contracts below the prices set by the other co-conspirators, however. Although lower than the pricing agreed upon by the conspirators, Hanjin and S-Oil still submitted bids above a competitive, non-collusive price, knowing that they would likely win the contracts because the other conspirators would bid even higher prices. VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 III. Explanation of the Proposed Final Judgment For violations of Section 1 of the Sherman Act, the United States may seek damages, 15 U.S.C. 15a, and equitable relief, 15 U.S.C. 4, including equitable monetary remedies. See United States v. KeySpan Corp., 763 F. Supp. 2d 633, 638–641 (S.D.N.Y. 2011). This action is related to three civil actions based on the same facts alleged in the Complaint and filed in the United States District Court for the Southern District of Ohio: (1) United States v. GS Caltex Corp. et al., No. 2:18–cv–1456, which seeks recovery from one set of coconspirators; (2) United States v. Hyundai Oilbank Co., Ltd. et al., No 2:19–cv–1037, which seeks recovery from a different set of co-conspirators; and (3) a qui tam action currently filed under seal, alleging a violation of the False Claims Act, 31 U.S.C. 3730. A. Payment and Cooperation The proposed Final Judgment requires Jier Shin Korea and Sang Joo Lee jointly and severally to pay $2,000,000 to the United States in three installments: The first installment of $1,000,000 is due within 10 business days of entry of the Final Judgment; the second installment of $500,000 is due within one year of the entry of the Final Judgment; and the third installment of $500,000 is due within two years of the entry of the Final Judgment. These payments will satisfy all civil claims arising from the events described in Section II supra that the United States has against Defendants under Section 1 of the Sherman Act and under the False Claims Act. The resolution of the United States’ claims under the False Claims Act is set forth in a separate agreement reached between Defendants, the U.S. Attorney’s Office for the Southern District of Ohio, and the U.S. Department of Justice’s Civil Division. See Attachment 1 of the proposed Final Judgment. As a result of the unlawful agreements in restraint of trade between Defendants and their co-conspirators, the United States paid more for the supply of fuel to U.S. military installations in South Korea than it would have if the companies had engaged in fair and honest competition. Defendants’ payments under the proposed Final Judgments compensate the United States for a portion of the losses it suffered as a result of the conspiracy. In addition to the payment of damages, the proposed Final Judgment also requires Defendants to cooperate with the United States regarding any ongoing civil investigation, litigation, or other proceeding arising out of any ongoing PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 21471 federal investigation of the subject matter discussed in the Complaint. To assist with these proceedings, Defendants are required to provide all non-privileged information in their possession, make available Jier Shin Korea’s present employees (including Lee), and use best efforts to make available Jier Shin Korea’s former employees, for interviews or testimony, as requested by the United States. Under Section 4A of the Clayton Act, the United States is entitled to treble damages for injuries it has suffered as a result of violations of the Sherman Act. The United States agreed to accept the damages amount from Defendants based on several considerations. First, the United States considered how much Defendants individually profited from the conspiracy. Second, the United States considered the risks of pursuing contested litigation and obtaining recovery from Defendants. Third, the United States considered the cooperation and assistance offered by the Defendants to date. Under an ongoing agreement to cooperate entered into at an early stage of the United States’ investigation of the bid rigging activity, Defendants have provided and continue to provide information that has benefited the United States’ civil investigations. This information and cooperation assisted the United States in obtaining settlements from Defendants’ co-conspirators totaling over $205 million—substantially more than the total damages suffered by the United States as a result of the conspiracy. Finally, the amount reflects the Defendants’ demonstration, through the submission of extensive financial information, that they are unable to pay the full amount of damages to which the United States is entitled. The proposed Final Judgment specifies that if the United States discovers any material misrepresentation in these financial statements, the United States may recover the full amount by which the Defendants understated their ability to pay, plus the United States’ attorneys fees and costs associated with obtaining such additional recovery. The proposed Final Judgment also requires Jier Shin Korea to appoint an Antitrust Compliance Officer and to institute an antitrust compliance program. Under the antitrust compliance program, employees and directors of Jier Shin Korea must undergo training and all employees must be informed that there will no reprisal for disclosing to the Antitrust Compliance Officer any potential violations of the United States antitrust laws. The Antitrust Compliance Officer is required annually to certify to the E:\FR\FM\17APN1.SGM 17APN1 21472 Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices jbell on DSKJLSW7X2PROD with NOTICES United States that Jier Shin Korea is in compliance with this requirement. B. Enforcement of Final Judgment The proposed Final Judgment contains provisions designed to promote compliance and make the enforcement of the Final Judgment as effective as possible. Paragraph VII(A) provides that the United States retains and reserves all rights to enforce the provisions of the proposed Final Judgment, including its rights to seek an order of contempt from the Court. Defendants have agreed that in any civil contempt action, any motion to show cause, or any similar action brought by the United States regarding an alleged violation of the Final Judgment, the United States may establish the violation and the appropriateness of any remedy by a preponderance of the evidence and that Defendants have waived any argument that a different standard of proof should apply. This provision aligns the standard for compliance obligations with the standard of proof that applies to the underlying offense that the compliance commitments address. Paragraph VII(B) provides additional clarification regarding the interpretation of the provisions of the proposed Final Judgment. The proposed Final Judgment was drafted to restore competition the United States alleged was harmed by Defendants’ challenged conduct. Defendants agree that they will abide by the proposed Final Judgment, and that they may be held in contempt of this Court for failing to comply with any provision of the proposed Final Judgment that is stated specifically and in reasonable detail, as interpreted in light of this procompetitive purpose. Paragraph VII(C) of the proposed Final Judgment provides that if the Court finds in an enforcement proceeding that a Defendant has violated the Final Judgment, the United States may apply to the Court for a onetime extension of the Final Judgment, together with such other relief as may be appropriate. In addition, to compensate American taxpayers for any costs associated with investigating and enforcing violations of the proposed Final Judgment, Paragraph VII(C) provides that in any successful effort by the United States to enforce the Final Judgment against a Defendant, whether litigated or resolved before litigation, that Defendants will reimburse the United States for attorneys’ fees, experts’ fees, and other costs incurred in connection with any enforcement effort, including the investigation of the potential violation. Finally, Section VIII of the proposed Final Judgment provides that the Final VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 Judgment will expire seven years from the date of its entry, except that after five years from the date of its entry, the Final Judgment may be terminated upon notice by the United States to the Court and Defendants that the continuation of the Final Judgment is no longer necessary or in the public interest. IV. Remedies Available to Potential Private Litigants Entry of the proposed Final Judgment will neither impair nor assist the bringing of any private antitrust damages action. Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the proposed Final Judgment has no prima facie effect in any subsequent private lawsuit that may be brought against Defendants. V. Procedures Available for Modification of the Proposed Final Judgment The United States and Defendants have stipulated that the proposed Final Judgment may be entered by the Court after compliance with the provisions of the APPA, provided that the United States has not withdrawn its consent. The APPA conditions entry upon the Court’s determination that the proposed Final Judgment is in the public interest. The APPA provides a period of at least sixty (60) days preceding the effective date of the proposed Final Judgment within which any person may submit to the United States written comments regarding the proposed Final Judgment. Any person who wishes to comment should do so within sixty (60) days of the date of publication of this Competitive Impact Statement in the Federal Register, or the last date of publication in a newspaper of the summary of this Competitive Impact Statement, whichever is later. All comments received during this period will be considered by the U.S. Department of Justice, and the United States remains free to withdraw its consent to the proposed Final Judgment at any time before the Court’s entry of the Final Judgment. The comments and the response of the United States will be filed with the Court. In addition, comments will be posted on the U.S. Department of Justice, Antitrust Division’s internet website and, under certain circumstances, published in the Federal Register. Written comments should be submitted by mail to: Robert A. Lepore, Chief, Transportation, Energy & Agriculture Section, Antitrust Division, United States Department of Justice, 450 5th Street NW, Suite 8000, Washington, DC 20530. PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 The proposed Final Judgment provides that the Court retains jurisdiction over this action, and the parties may apply to the Court for any order necessary or appropriate for the modification, interpretation, or enforcement of the Final Judgment. VI. Alternatives to the Proposed Final Judgment As an alternative to the proposed Final Judgment, the United States considered a full trial on the merits against Defendants. The United States is satisfied, however, that the relief in the proposed Final Judgment remedies the violation of the Sherman Act alleged in the Complaint. The proposed Final Judgment represents substantial monetary relief while avoiding the time, expense, and uncertainty of a full trial on the merits. Further, Defendants’ cooperation with the civil investigation and any potential litigation will enhance the ability of the United States to resolve issues related to the civil investigation and any potential litigation. VII. Standard of Review Under the APPA for the Proposed Final Judgment The Clayton Act, as amended by the APPA, requires that proposed consent judgments in antitrust cases brought by the United States be subject to a 60-day comment period, after which the Court shall determine whether entry of the proposed Final Judgment ‘‘is in the public interest.’’ 15 U.S.C. 16(e)(1). In making that determination, the Court, in accordance with the statute as amended in 2004, is required to consider: (A) The competitive impact of such judgment, including termination of alleged violations, provisions for enforcement and modification, duration of relief sought, anticipated effects of alternative remedies actually considered, whether its terms are ambiguous, and any other competitive considerations bearing upon the adequacy of such judgment that the court deems necessary to a determination of whether the consent judgment is in the public interest; and (B) the impact of entry of such judgment upon competition in the relevant market or markets, upon the public generally and individuals alleging specific injury from the violations set forth in the complaint including consideration of the public benefit, if any, to be derived from a determination of the issues at trial. 15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, the Court’s inquiry is necessarily a limited one as the government is entitled to ‘‘broad discretion to settle with the E:\FR\FM\17APN1.SGM 17APN1 jbell on DSKJLSW7X2PROD with NOTICES Federal Register / Vol. 85, No. 75 / Friday, April 17, 2020 / Notices defendant within the reaches of the public interest.’’ United States v. Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); United States v. U.S. Airways Grp., Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 2014) (explaining that the ‘‘court’s inquiry is limited’’ in Tunney Act settlements); United States v. InBev N.V./S.A., No. 08–1965 (JR), 2009 U.S. Dist. LEXIS 84787, at *3 (D.D.C. Aug. 11, 2009) (noting that a court’s review of a consent judgment is limited and only inquires ‘‘into whether the government’s determination that the proposed remedies will cure the antitrust violations alleged in the complaint was reasonable, and whether the mechanism to enforce the final judgment are clear and manageable’’). As the U.S. Court of Appeals for the District of Columbia Circuit has held, under the APPA a court considers, among other things, the relationship between the remedy secured and the specific allegations in the government’s complaint, whether the proposed Final Judgment is sufficiently clear, whether its enforcement mechanisms are sufficient, and whether it may positively harm third parties. See Microsoft, 56 F.3d at 1458–62. With respect to the adequacy of the relief secured by the proposed Final Judgment, a court may ‘‘not to make de novo determination of facts and issues.’’ United States v. W. Elec. Co., 993 F.2d 1572, 1577 (D.C. Cir. 1993) (quotation marks omitted); see also Microsoft, 56 F.3d at 1460–62; United States v. Alcoa, Inc., 152 F. Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F. Supp. 2d 10, 16 (D.D.C. 2000); InBev, 2009 U.S. Dist. LEXIS 84787, at *3. Instead, ‘‘[t]he balancing of competing social and political interests affected by a proposed antitrust consent decree must be left, in the first instance, to the discretion of the Attorney General.’’ W. Elec. Co., 993 F.2d at 1577 (quotation marks omitted). ‘‘The court should bear in mind the flexibility of the public interest inquiry: The court’s function is not to determine whether the resulting array of rights and liabilities is one that will best serve society, but only to confirm that the resulting settlement is within the reaches of the public interest.’’ Microsoft, 56 F.3d at 1460 (quotation marks omitted). More demanding requirements would ‘‘have enormous practical consequences for the government’s ability to negotiate future settlements,’’ contrary to congressional intent. Id. at 1456. ‘‘The Tunney Act was not intended to create a disincentive to the use of the consent decree.’’ Id. The United States’ predictions about the efficacy of the remedy are to be VerDate Sep<11>2014 18:19 Apr 16, 2020 Jkt 250001 afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at 1461 (recognizing courts should give ‘‘due respect to the Justice Department’s . . . view of the nature of its case’’); United States v. Iron Mountain, Inc., 217 F. Supp. 3d 146, 152–53 (D.D.C. 2016) (‘‘In evaluating objections to settlement agreements under the Tunney Act, a court must be mindful that [t]he government need not prove that the settlements will perfectly remedy the alleged antitrust harms[;] it need only provide a factual basis for concluding that the settlements are reasonably adequate remedies for the alleged harms.’’) (internal citations omitted); United States v. Republic Servs., Inc., 723 F. Supp. 2d 157, 160 (D.D.C. 2010) (noting ‘‘the deferential review to which the government’s proposed remedy is accorded’’); United States v. ArcherDaniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (‘‘A district court must accord due respect to the government’s prediction as to the effect of proposed remedies, its perception of the market structure, and its view of the nature of the case’’). The ultimate question is whether ‘‘the remedies [obtained by the Final Judgment are] so inconsonant with the allegations charged as to fall outside of the ‘reaches of the public interest.’ ’’ Microsoft, 56 F.3d at 1461 (quoting W. Elec. Co., 900 F.2d at 309). Moreover, the Court’s role under the APPA is limited to reviewing the remedy in relationship to the violations that the United States has alleged in its complaint, and does not authorize the Court to ‘‘construct [its] own hypothetical case and then evaluate the decree against that case.’’ Microsoft, 56 F.3d at 1459; see also U.S. Airways, 38 F. Supp. 3d at 75 (noting that the court must simply determine whether there is a factual foundation for the government’s decisions such that its conclusions regarding the proposed settlements are reasonable); InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (‘‘the ‘public interest’ is not to be measured by comparing the violations alleged in the complaint against those the court believes could have, or even should have, been alleged’’). Because the ‘‘court’s authority to review the decree depends entirely on the government’s exercising its prosecutorial discretion by bringing a case in the first place,’’ it follows that ‘‘the court is only authorized to review the decree itself,’’ and not to ‘‘effectively redraft the complaint’’ to inquire into other matters that the United States did not pursue. Microsoft, 56 F.3d at 1459–60. In its 2004 amendments to the APPA, Congress made clear its intent to preserve the practical benefits of using PO 00000 Frm 00088 Fmt 4703 Sfmt 9990 21473 consent judgments proposed by the United States in antitrust enforcement, Public Law 108–237 § 221, and added the unambiguous instruction that ‘‘[n]othing in this section shall be construed to require the court to conduct an evidentiary hearing or to require the court to permit anyone to intervene.’’ 15 U.S.C. 16(e)(2); see also U.S. Airways, 38 F. Supp. 3d at 76 (indicating that a court is not required to hold an evidentiary hearing or to permit intervenors as part of its review under the Tunney Act). This language explicitly wrote into the statute what Congress intended when it first enacted the Tunney Act in 1974. As Senator Tunney explained: ‘‘[t]he court is nowhere compelled to go to trial or to engage in extended proceedings which might have the effect of vitiating the benefits of prompt and less costly settlement through the consent decree process.’’ 119 Cong. Rec. 24,598 (1973) (statement of Sen. Tunney). ‘‘A court can make its public interest determination based on the competitive impact statement and response to public comments alone.’’ U.S. Airways, 38 F. Supp. 3d at 76 (citing Enova Corp., 107 F. Supp. 2d at 17). VIII. Determinative Documents There are no determinative materials or documents within the meaning of the APPA that were considered by the United States in formulating the proposed Final Judgment. Dated: April 8, 2020. Respectfully submitted, David M. Devillers, United States Attorney. /s/ Andrew M. Malek, llllllllll (Ohio Bar #0061442), Assistant United States Attorney, 303 Marconi Boulevard, Suite 200 Columbus, Ohio 43215, Tel: (614) 469–5715, Fax: (614) 469–2769, Email: Andrew.Malek@ usdoj.gov. /s/ J. Richard Doidge, llllllllll Attorney U.S. Department of Justice, Antitrust Division, 450 5th Street NW, Suite 8000, Washington, DC 20530, Tel: (202) 514– 8944, Fax: (202) 616–2441, Email: Dick.Doidge@usdoj.gov. [FR Doc. 2020–08138 Filed 4–16–20; 8:45 am] BILLING CODE 4410–11–P E:\FR\FM\17APN1.SGM 17APN1

Agencies

[Federal Register Volume 85, Number 75 (Friday, April 17, 2020)]
[Notices]
[Pages 21462-21473]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-08138]



[[Page 21462]]

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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Jier Shin Korea Co., Ltd., et al.; Proposed 
Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, a 
Stipulation, and a Competitive Impact Statement have been filed with 
the United States District Court for the Southern District of Ohio in 
United States v. Jier Shin Korea Co., Ltd., et al., Case No. 2:20-cv-
1778. On April 8, 2020, the United States filed a Complaint alleging 
that between 2005 and 2016, Jier Shin Korea Co., Ltd. (``Jier Shin 
Korea'') and its president Sang Joo Lee, along with other co-
conspirators, conspired to rig bids for Posts, Camps & Stations (PC&S) 
and Army and Air Force Exchange Service (AAFES) fuel supply contracts 
with the U.S. military in South Korea, in violation of Section 1 of the 
Sherman Act, 15 U.S.C. 1. A proposed Final Judgment, filed at the same 
time as the Complaint, requires Defendants to jointly and severally pay 
the United States $2,000,000. In addition, Defendants have agreed to 
cooperate with further civil investigative and judicial proceedings and 
Jier Shin Korea has agreed to institute an antitrust compliance 
program.
    Copies of the Complaint, proposed Final Judgment, and Competitive 
Impact Statement are available for inspection on the Antitrust 
Division's website at http://www.justice.gov/atr and at the Office of 
the Clerk of the United States District Court for the Southern District 
of Ohio. Copies of these materials may be obtained from the Antitrust 
Division upon request and payment of the copying fee set by Department 
of Justice regulations.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the Antitrust Division's website, 
filed with the Court, and, under certain circumstances, published in 
the Federal Register. Comments should be directed to Robert A. Lepore, 
Chief, Transportation, Energy & Agriculture Section, Antitrust 
Division, Department of Justice, 450 5th Street NW, Suite 8000, 
Washington, DC 20530 (telephone: 202-307-6349).

Suzanne Morris,
Chief, Premerger and Division Statistics.

United States District Court for the Southern District of Ohio Eastern 
Division

    United States of America, Plaintiff, v. Jier Shin Korea Co., 
Ltd., Jindo Bldg., Room 1405, 37, Dohwa-dong, Mapo-gu, Seoul, South 
Korea, and Sang Joo Lee, c/o Jier Shin Korea Co., Ltd., indo Bldg., 
Room 1405, 37, Dohwa-dong, Mapo-gu, Seoul, South Korea, Defendants.

Case No. 2:20-cv-1788
Complaint: Violation of Section 1 of the Sherman Act, 15 U.S.C. 1

Complaint

    The United States of America, acting under the direction of the 
Attorney General of the United States, brings this civil antitrust 
action to obtain equitable monetary relief and recover damages from 
Jier Shin Korea Co., Ltd. and Sang Joo Lee for conspiring to rig bids 
and fix prices, in violation of Section 1 of the Sherman Act, 15 U.S.C. 
1, on the supply of fuel to the U.S. military for its operations in 
South Korea.

I. Introduction

    1. Since the end of the Korean War, the U.S. armed forces have 
maintained a significant presence in South Korea, protecting American 
interests in the region and safeguarding peace for the Korean people. 
To perform this important mission, American service members depend on 
fuel to power their bases and military vehicles. The U.S. military 
procures this fuel from oil refiners located in South Korea through a 
competitive bidding process.
    2. For at least a decade, rather than engage in fair and honest 
competition, Defendants and their co-conspirators defrauded the U.S. 
military by fixing prices and rigging bids for the contracts to supply 
this fuel. Defendants met and communicated in secret with large South 
Korean oil refiners and other logistics companies, and pre-determined 
which conspirator would win each contract. Defendants or their co-
conspirators then fraudulently submitted collusive bids to the U.S. 
military. Through this scheme, Defendants reaped supracompetitive 
profit margins on the fuel delivered to the U.S. military.
    3. As a result of this conduct, Defendants and their co-
conspirators illegally overcharged American taxpayers by well over $100 
million. This conspiracy unreasonably restrained trade and commerce, in 
violation of Section 1 of the Sherman Act, 15 U.S.C. 1.

II. Defendants

    4. Jier Shin Korea Co., Ltd. (``Jier Shin Korea'') is a small, 
privately held logistics company located in Seoul, South Korea. Jier 
Shin Korea provides logistics services related to the transportation of 
fuel, petroleum by-products, and other goods. During the conspiracy, 
Jier Shin Korea partnered with a South Korean oil refiner, Hyundai 
Oilbank Co., Ltd. (``Hyundai Oilbank''), to supply fuel to U.S. 
military installations in South Korea, with Jier Shin Korea acting as 
the prime contractor under the relevant contracts.
    5. Sang Joo Lee is the president of Jier Shin Korea. Jier Shin 
Korea is a closely held firm majority owned by Lee and his family.
    6. Other persons, not named as defendants in this action, 
participated as co-conspirators in the offense alleged in this 
Complaint and performed acts and made statements in furtherance 
thereof. These co-conspirators include, among others, GS Caltex 
Corporation (``GS Caltex''), Hanjin Transportation Co., Ltd. 
(``Hanjin''), SK Energy Co., Ltd. (``SK Energy''), Hyundai Oilbank, and 
S-Oil Corporation (``S-Oil'').
    7. Whenever this Complaint refers to any act, deed, or transaction 
of any business entity, it means that the business entity engaged in 
the act, deed, or transaction by or through its officers, directors, 
employees, agents, or other representatives while they were actively 
engaged in the management, direction, control, or transaction of its 
business or affairs. As president of Jier Shin Korea, Lee knowingly, 
directly, and substantially participated in the acts of Jier Shin Korea 
described herein.

III. Jurisdiction and Venue

    8. The United States brings this action under Section 4 of the 
Sherman Act, 15 U.S.C. 4, and Section 4A of the Clayton Act, 15 U.S.C. 
15a, seeking equitable relief, including equitable monetary remedies, 
and damages from Defendants' violation of Section 1 of the Sherman Act, 
15 U.S.C. 1.
    9. This Court has subject matter jurisdiction over this action 
under 15 U.S.C. 4 and 15a and 28 U.S.C. 1331 and 1337.
    10. Defendants have consented to venue and personal jurisdiction in 
this district for the purpose of this Complaint.
    11. Defendants or their co-conspirators entered into contracts with 
the U.S. military to supply and deliver fuel to U.S. military 
installations in South Korea. Under the terms of these

[[Page 21463]]

contracts, Defendants or their co-conspirators agreed that the laws of 
the United States would govern all contractual disputes and that U.S. 
administrative bodies and courts would have exclusive jurisdiction to 
resolve all such disputes. To be eligible to enter into these 
contracts, Defendants or their co-conspirators registered in databases 
located in the United States. For certain contracts, Defendants or 
their co-conspirators submitted bids to U.S. Department of Defense 
offices in the United States. After being awarded these contracts, 
Defendants or their co-conspirators submitted invoices to and received 
payments from U.S. Department of Defense offices in Columbus, Ohio, 
which included use of wires and mails located in the United States.
    12. Through these contracts with the U.S. military, Defendants' 
activities had a direct, substantial, and reasonably foreseeable effect 
on interstate commerce, import trade or commerce, and commerce with 
foreign nations. Defendants' conspiracy had a substantial and intended 
effect in the United States. Defendants caused U.S. Department of 
Defense agencies to pay non-competitive prices for the supply of fuel 
to U.S. military installations. Defendants or their co-conspirators 
also caused a U.S. Department of Defense agency located in the Southern 
District of Ohio to transfer U.S. dollars to their foreign bank 
accounts.

IV. Background

    13. From at least March 2005 and continuing until at least October 
2016 (``the Relevant Period''), the U.S. military procured fuel for its 
installations in South Korea through competitive solicitation 
processes. Oil companies, either independently or in conjunction with a 
logistics company, submitted bids in response to these solicitations.
    14. The conduct at issue relates to two types of contracts to 
supply fuel to the U.S. military for use in South Korea: Post, Camps, 
and Stations (``PC&S'') contracts and Army and Air Force Exchange 
Services (``AAFES'') contracts.
    15. PC&S contracts are issued and administered by the Defense 
Logistics Agency (``DLA''), a combat support agency in the U.S. 
Department of Defense. DLA, formerly known as the Defense Energy 
Support Center, is headquartered in Fort Belvoir, Virginia. The fuel 
procured under PC&S contracts is used for military vehicles and to heat 
U.S. military buildings. During the Relevant Period, PC&S contracts ran 
for a term of three or four years. DLA issued PC&S solicitations 
listing the fuel requirements for installations across South Korea, 
with each delivery location identified by a separate line item. Bidders 
offered a price for each line item on which they chose to bid. DLA 
awarded contracts to the bidders offering the lowest price for each 
line item. The Defense Finance and Accounting Service (``DFAS''), a 
finance and accounting agency of the U.S. Department of Defense, wired 
payments to the PC&S contract awardees from its office in Columbus, 
Ohio.
    16. AAFES is an agency of the Department of Defense headquartered 
in Dallas, Texas. AAFES operates official retail stores (known as 
``exchanges'') on U.S. Army and Air Force installations worldwide, 
which U.S. military personnel and their families use to purchase 
everyday goods and services, including gasoline for use in their 
personal vehicles. AAFES procures fuel for these stores via contracts 
awarded through a competitive solicitation process. The term of AAFES 
contracts is typically two years, but may be extended for additional 
years. In 2008, AAFES issued a solicitation that listed the fuel 
requirements for installations in South Korea. Unlike DLA, AAFES 
awarded the entire 2008 contract to the bidder offering the lowest 
price across all the listed locations.

V. Defendants' Unlawful Conduct

    17. From at least March 2005 and continuing until at least October 
2016, Defendants and their co-conspirators engaged in a series of 
meetings, telephone conversations, emails, and other communications to 
rig bids and fix prices for the supply of fuel to U.S. military 
installations in South Korea.

2006 PC&S and 2008 AAFES Contracts

    18. GS Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea 
(through Lee and other agents) conspired to rig bids and fix prices on 
the 2006 PC&S contracts, which were issued in response to solicitation 
SP0600-05-R-0063, supplemental solicitation SP0600-05-0063-0001, and 
their amendments. The term of the 2006 PC&S contracts covered the 
supply of fuel from February 2006 through July 2009.
    19. Between early 2005 and mid-2006, GS Caltex, SK Energy, Hyundai 
Oilbank, and Jier Shin Korea met multiple times and exchanged phone 
calls and emails to allocate the line items in the solicitations for 
the 2006 PC&S contracts. For each line item allocated to a different 
co-conspirator, the other conspirators agreed not to bid or to bid high 
enough to ensure that they would not win that item. Through these 
communications, these conspirators agreed to inflate their bids to 
produce higher profit margins. DLA awarded the 2006 PC&S line items 
according to the allocations made by the conspiracy.
    20. As part of their discussions related to the 2006 PC&S 
contracts, Jier Shin Korea and other conspirators agreed not to compete 
with SK Energy in bidding for the 2008 AAFES contract. In 2008, GS 
Caltex, Hyundai Oilbank, and Jier Shin Korea honored their agreement: 
GS Caltex bid significantly above the bid submitted by SK Energy for 
the AAFES contract, while Hyundai Oilbank and Jier Shin Korea declined 
to bid even after AAFES explicitly requested their participation in the 
bidding. The initial term of the 2008 AAFES contract ran from July 2008 
to July 2010; the contract was later extended through July 2013. As 
envisioned by the conspiracy, AAFES awarded the 2008 contract to SK 
Energy.

2009 PC&S Contracts

    21. Continuing their conspiracy, Jier Shin Korea and other co-
conspirators conspired to rig bids and fix prices for the 2009 PC&S 
contracts, which were issued in response to solicitation SP0600-08-R-
0233. Hanjin and S-Oil joined the conspiracy for the purpose of bidding 
on the solicitation for the 2009 PC&S contracts. Hanjin and S-Oil 
partnered to bid jointly on the 2009 PC&S contracts, with S-Oil 
providing the fuel and Hanjin providing transportation and logistics. 
The term of the 2009 PC&S contracts covered the supply of fuel from 
October 2009 through August 2013.
    22. Between late 2008 and mid-2009, Jier Shin Korea and other co-
conspirators met multiple times and exchanged phone calls and emails to 
allocate the line items in the solicitation for the 2009 PC&S 
contracts. As in 2006, these conspirators agreed to bid high so as to 
not win line items allocated to other co-conspirators. The original 
conspirators agreed to allocate to Hanjin and S-Oil certain line items 
that had previously been allocated to the original conspirators.
    23. With one exception, DLA awarded the 2009 PC&S contracts in line 
with the allocations made by Jier Shin Korea and other co-conspirators. 
Hyundai Oilbank and Jier Shin Korea accidentally won one line item that 
the conspiracy had allocated to GS Caltex. To remedy this 
misallocation, Jier Shin Korea, Hyundai Oilbank, and GS Caltex agreed 
that GS Caltex, rather than Hyundai Oilbank, would supply Jier Shin 
Korea with the fuel procured under this line item.

[[Page 21464]]

2013 PC&S Contracts

    24. Similar to 2006 and 2009, Jier Shin Korea and other co-
conspirators conspired to rig bids and fix prices for the 2013 PC&S 
contracts, which were issued in response to solicitation SP0600-12-R-
0332. The term of the 2013 PC&S Contract covered the supply of fuel 
from August 2013 through July 2016.
    25. Jier Shin Korea and other co-conspirators communicated via 
phone calls and emails to allocate and set the price for each line item 
in the solicitation for the 2013 PC&S contracts. Jier Shin Korea and 
other co-conspirators believed that they had an agreement as to their 
bidding strategy and pricing for the 2013 PC&S contracts. As a result 
of this agreement, they bid higher prices than they would have in a 
competitive process.
    26. However, Hanjin and S-Oil submitted bids for the 2013 PC&S 
contracts below the prices set by the other co-conspirators. Although 
lower than the pricing agreed upon by the conspirators, Hanjin and S-
Oil still submitted bids above a competitive, non-collusive price, 
knowing that they would likely win the contracts because the other 
conspirators would bid even higher prices.
    27. As a result of their bidding strategy, Hanjin and S-Oil jointly 
won nearly all the line items in the 2013 PC&S contracts. As in 2009, 
S-Oil was to provide the fuel for these line items, and Hanjin was to 
provide transportation and logistics. Jier Shin Korea and other co-
conspirators won a few, small line items; SK Energy won none. DLA made 
inflated payments under the 2013 PC&S contracts through October 2016.
    28. After the award of the 2013 PC&S contracts, Hanjin, S-Oil, and 
GS Caltex reached an understanding that GS Caltex, rather than S-Oil, 
would supply Hanjin with fuel for certain line items. Under this side 
agreement, Hanjin paid a much lower price to GS Caltex for fuel than 
the price it previously had agreed to pay S-Oil to acquire fuel for 
those line items. However, the price that Hanjin paid to GS Caltex 
exceeded a competitive price for fuel.

VI. Violations Alleged

    29. The United States incorporates by reference the allegations in 
paragraphs 1 through 28.
    30. The conduct of Defendants and their co-conspirators 
unreasonably restrained trade and harmed competition for the supply of 
fuel to the U.S. military in South Korea in violation of Section 1 of 
the Sherman Act, 15 U.S.C. 1.
    31. The United States was injured as a result of the unlawful 
conduct because it paid more for the supply of fuel than it would have 
had Defendants and their co-conspirators engaged in fair competition.

VII. Request for Relief

    32. The United States requests that this Court:
    (a) Adjudge that Defendants' and their co-conspirators' conduct 
constitutes an unreasonable restraint of interstate commerce, import 
trade or commerce, and commerce with foreign nations in violation of 
Section 1 of the Sherman Act, 15 U.S.C. 1;
    (b) award the United States damages to which it is entitled for the 
losses incurred as the result of Defendants' and their co-conspirators' 
conduct;
    (c) award the United States equitable disgorgement of the ill-
gotten gains obtained by Defendants;
    (d) award the United States its costs of this action; and
    (e) award the United States other relief that the Court deems just 
and proper.

Dated: April 8, 2020

Respectfully submitted,

FOR PLAINTIFF UNITED STATES OF AMERICA:

/s/--------------------------------------------------------------------
Makan Delrahim,
Assistant Attorney General for Antitrust.

/s/--------------------------------------------------------------------
Bernard A. Nigro, Jr.,
Principal Deputy Assistant Attorney General.

/s/--------------------------------------------------------------------
Kathleen S. O'Neill,
Senior Director of Investigations and Litigation.

/s/--------------------------------------------------------------------
Robert A. Lepore,
Chief, Transportation, Energy & Agriculture Section.

/s/--------------------------------------------------------------------
Katherine Celeste,
Assistant Chief, Transportation, Energy & Agriculture Section.

/s/--------------------------------------------------------------------
J. Richard Doidge,
John A. Holler
Attorneys for the United States, U.S. Department of Justice, 
Antitrust Division, 450 5th Street NW, Suite 8000, Washington, DC 
20530, Tel: (202) 514-8944, Fax: (202) 616-2441, Email: 
[email protected].

Dated: April 8, 2020

Respectfully submitted,

FOR PLAINTIFF UNITED STATES OF AMERICA:

DAVID M. DEVILLERS,
United States Attorney.

By:

/s/--------------------------------------------------------------------
Andrew M. Malek (Ohio Bar #0061442)
Assistant United States Attorney
303 Marconi Boulevard, Suite 200
Columbus, Ohio 43215
Tel: (614) 469-5715
Fax: (614) 469-2769
Email: [email protected]

United States District Court for the Southern District of Ohio Eastern 
Division

    United States of America,Plaintiff, v. Jier Shin Korea Co., Ltd. 
and Sang Joo Lee, Defendants.

Case No. 2:20-cv-1788

Proposed Final Judgment as to Defendants Jier Shin Korea Co., Ltd. and 
Sang Joo Lee

    Whereas Plaintiff, United States of America, filed its Complaint on 
April 8, 2020, the United States and Defendants Jier Shin Korea Co., 
Ltd. (``Jier Shin Korea'') and Sang Joo Lee, by their respective 
attorneys, have consented to the entry of this Final Judgment without 
trial or adjudication of any issue of fact or law;
    Whereas, this Final Judgment does not constitute any evidence 
against or admission by any party regarding any issue of fact or law;
    Now, therefore, before the taking of any testimony and without 
trial or final adjudication of any issue of fact or law herein, and 
upon consent of the parties hereto, it is hereby Ordered, Adjudged, and 
Decreed:

I. Jurisdiction

    This Court has jurisdiction over the subject matter of this action 
and each of the parties. The Complaint states a claim upon which relief 
may be granted to the United States against Jier Shin Korea and Sang 
Joo Lee under Section 1 of the Sherman Act, 15 U.S.C. 1.

II. Applicability

    This Final Judgment applies to Jier Shin Korea and Sang Joo Lee, as 
defined above, and all other persons in active concert or participation 
with any of them who receive actual notice of this Final Judgment by 
personal service or otherwise.

III. Payments

    Jier Shin Korea and Sang Joo Lee jointly and severally shall pay to 
the United States the total sum of two million dollars ($2,000,000) 
over three installments:
    (a) Within ten (10) business days of the entry of this Final 
Judgment, the amount of one million dollars ($1,000,000);
    (b) within one (1) calendar year of the entry of this Final 
Judgment, the amount of five hundred thousand dollars ($500,000); and

[[Page 21465]]

    (c) within two (2) calendar years of the entry of this Final 
Judgment, the amount of five hundred thousand dollars ($500,000);

less the amount paid (excluding any interest) pursuant to the 
settlement agreement attached hereto as Attachment 1. These payments 
satisfy all civil antitrust claims alleged against Jier Shin Korea and 
Sang Joo Lee by the United States in the Complaint. Payments of the 
amounts ordered hereby shall be made by wire transfer of funds or 
cashier's check. If the payment is made by wire transfer, Jier Shin 
Korea and Sang Joo Lee shall contact Janie Ingalls of the Antitrust 
Division's Antitrust Documents Group at (202) 514-2481 for instructions 
before making the transfer. If the payment is made by cashier's check, 
the check shall be made payable to the United States Department of 
Justice and delivered to: Janie Ingalls, United States Department of 
Justice Antitrust Division, Antitrust Documents Group, 450 5th Street 
NW, Suite 1024, Washington, DC 20530. In the event of a default in 
payment, interest at the rate of eighteen (18) percent per annum shall 
accrue thereon from the date of default to the date of payment.
    Jier Shin and Sang Joo Lee have provided sworn financial disclosure 
statements (``Financial Statements'') to the United States and the 
United States has relied on the accuracy and completeness of those 
Financial Statements in agreeing to this Final Judgment. Jier Shin and 
Sang Joo Lee warrant that the Financial Statements are complete, 
accurate, and current. If the United States learns of any asset(s) in 
which Jier Shin and Sang Joo Lee had an interest as of April 8, 2020 
that were not disclosed in the Financial Statements, or if the United 
States learns of any misrepresentation by Jier Shin and Sang Joo Lee 
on, or in connection with, the Financial Statements, and if such 
nondisclosure or misrepresentation changes the estimated net worth set 
forth in the Financial Statements by $100,000 or more, the United 
States may collect the full payments set forth in this section plus one 
hundred percent (100%) of the value of the net worth of Jier Shin and 
Sang Joo Lee previously undisclosed. Jier Shin and Sang Joo Lee agree 
not to contest any collection action undertaken by the United States 
pursuant to this provision, and immediately to pay the United States 
all reasonable costs incurred in such an action, including attorney's 
fees and expenses.

IV. Cooperation

    Jier Shin Korea and Sang Joo Lee shall cooperate fully with the 
United States regarding any matter about which they have knowledge or 
information relating to any ongoing civil investigation, litigation, or 
other proceeding arising out of any ongoing federal investigation of 
the subject matter discussed in the Complaint (hereinafter, any such 
investigation, litigation, or proceeding shall be referred to as a 
``Civil Federal Proceeding'').
    The United States agrees that any cooperation provided pursuant to 
the settlement agreement attached hereto as Attachment 1 will be 
considered cooperation for purposes of this Final Judgment, and the 
United States will use its reasonable best efforts, where appropriate, 
to coordinate any requests for cooperation in connection with the Civil 
Federal Proceeding with requests for cooperation in connection with the 
settlement agreement attached hereto as Attachment 1, so as to avoid 
unnecessary duplication and expense.
    Jier Shin Korea and Sang Joo Lee's cooperation shall include, but 
not be limited to, the following:
    (a) Upon request, completely and truthfully disclosing and 
producing, to the offices of the United States and at no expense to the 
United States, copies of all non-privileged information, documents, 
materials, and records in their possession (and for any foreign-
language information, documents, materials, or records, copies must be 
produced with an English translation), regardless of their geographic 
location, about which the United States may inquire in connection with 
any Civil Federal Proceeding, including but not limited to all 
information about activities of Jier Shin Korea and present and former 
officers, directors, employees, and agents of Jier Shin Korea;
    (b) Making available in the United States, at no expense to the 
United States, Jier Shin Korea's present officers, directors, 
employees, and agents to provide information and/or testimony as 
requested by the United States in connection with any Civil Federal 
Proceeding, including the provision of testimony in trial and other 
judicial proceedings, as well as interviews with law enforcement 
authorities, consistent with the rights and privileges of those 
individuals;
    (c) Using their best efforts to make available in the United 
States, at no expense to the United States, Jier Shin Korea's former 
officers, directors, employees, and agents to provide information and/
or testimony as requested by the United States in connection with any 
Civil Federal Proceeding, including the provision of testimony in trial 
and other judicial proceedings, as well as interviews with law 
enforcement authorities, consistent with the rights and privileges of 
those individuals;
    (d) Providing testimony or information necessary to identify or 
establish the original location, authenticity, or other basis for 
admission into evidence of documents or physical evidence produced by 
Jier Shin Korea or Sang Joo Lee in any Civil Federal Proceeding as 
requested by the United States; and
    (e) Completely and truthfully responding to all other inquiries of 
the United States in connection with any Civil Federal Proceeding.
    However, notwithstanding any provision of this Final Judgment, Jier 
Shin Korea and Sang Joo Lee are not required to: (1) Request of Jier 
Shin Korea's current or former officers, directors, employees, or 
agents that they forgo seeking the advice of an attorney nor that they 
act contrary to that advice; (2) take any action against Jier Shin 
Korea's officers, directors, employees, or agents for following their 
attorney's advice; or (3) waive any claim of privilege or work product 
protection.
    The obligations of Jier Shin Korea and Sang Joo Lee to cooperate 
fully with the United States as described in this Section shall cease 
upon the conclusion of all Civil Federal Proceedings (which may include 
Civil Federal Proceedings related to the conduct of third parties), 
including exhaustion of all appeals or expiration of time for all 
appeals of any Court ruling in each such Civil Federal Proceeding, at 
which point the United States will provide written notice to Jier Shin 
Korea and Sang Joo Lee that their obligations under this Section have 
expired.

V. Antitrust Compliance Program

    A. Within thirty (30) days after entry of this Final Judgment, Jier 
Shin Korea shall appoint an Antitrust Compliance Officer and identify 
to the United States his or her name, business address, telephone 
number, and email address. Within forty-five (45) days of a vacancy in 
the Antitrust Compliance Officer position, Jier Shin Korea shall 
appoint a replacement, and shall identify to the United States the 
Antitrust Compliance Officer's name, business address, telephone 
number, and email address. Jier Shin Korea's initial or replacement 
appointment of an Antitrust Compliance Officer is subject to the 
approval of the United States, in its sole discretion.

[[Page 21466]]

    B. The Antitrust Compliance Officer shall institute an antitrust 
compliance program for Jier Shin Korea's employees and directors. The 
antitrust compliance program shall provide at least two hours of 
training annually on the antitrust laws of the United States, such 
training to be delivered by an attorney with relevant experience in the 
field of United States antitrust law.
    C. Each Antitrust Compliance Officer shall obtain, within six 
months after entry of this Final Judgment, and on an annual basis 
thereafter, on or before each anniversary of the entry of this Final 
Judgment, from each person subject to Paragraph V.B of this Final 
Judgment, and thereafter maintaining, a certification that each such 
person has received the required two hours of annual antitrust 
training.
    D. Each Antitrust Compliance Officer shall communicate annually to 
all Jier Shin Korea employees that they may disclose to the Antitrust 
Compliance Officer, without reprisal, information concerning any 
potential violation of the United States antitrust laws.
    E. Each Antitrust Compliance Offer shall provide to the United 
States within six months after entry of this Final Judgment, and on an 
annual basis thereafter, on or before each anniversary of the entry of 
this Final Judgment, a written statement as to the fact and manner of 
Jier Shin Korea's compliance with Section V of this Final Judgment.

VI. Retention of Jurisdiction

    This Court retains jurisdiction to enable any of the parties to 
this Final Judgment to apply to this Court at any time for further 
orders and directions as may be necessary or appropriate to carry out 
or construe this Final Judgment, to modify or terminate any of its 
provisions, to enforce compliance, and to punish violations of its 
provisions.

VII. Enforcement of Final Judgment

    A. The United States retains and reserves all rights to enforce the 
provisions of this Final Judgment, including the right to seek an order 
of contempt from the Court. Jier Shin Korea and Sang Joo Lee agree that 
in any civil contempt action, any motion to show cause, or any similar 
action brought by the United States regarding an alleged violation of 
this Final Judgment, the United States may establish a violation of the 
decree and the appropriateness of any remedy therefor by a 
preponderance of the evidence, and Jier Shin Korea and Sang Joo Lee 
waive any argument that a different standard of proof should apply.
    B. The Final Judgment should be interpreted to give full effect to 
the procompetitive purposes of the antitrust laws and to restore all 
competition the United States alleged was harmed by the challenged 
conduct. Jier Shin Korea and Sang Joo Lee agree that they may be held 
in contempt of, and that the Court may enforce, any provision of this 
Final Judgment that, as interpreted by the Court in light of these 
procompetitive principles and applying ordinary tools of 
interpretation, is stated specifically and in reasonable detail, 
whether or not it is clear and unambiguous on its face. In any such 
interpretation, the terms of this Final Judgment should not be 
construed against either party as the drafter.
    C. In any enforcement proceeding in which the Court finds that Jier 
Shin Korea or Sang Joo Lee has violated this Final Judgment, the United 
States may apply to the Court for a one-time extension of this Final 
Judgment, together with such other relief as may be appropriate. In 
connection with any successful effort by the United States to enforce 
this Final Judgment against Jier Shin Korea or Sang Joo Lee, whether 
litigated or resolved prior to litigation, Jier Shin Korea and Sang Joo 
Lee agree to reimburse the United States for the fees and expenses of 
its attorneys, as well as any other costs including experts' fees, 
incurred in connection with that enforcement effort, including in the 
investigation of the potential violation.

VIII. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire seven (7) years from the date of its entry, except that after 
five (5) years from the date of its entry, this Final Judgment may be 
terminated upon notice by the United States to the Court, Jier Shin 
Korea, and Sang Joo Lee that the continuation of the Final Judgment no 
longer is necessary or in the public interest.

IX. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16, including making copies available to the 
public of this Final Judgment, the Competitive Impact Statement, and 
any comments thereon and the United States' responses to comments. 
Based upon the record before the Court, which includes the Competitive 
Impact Statement and any comments and response to comments filed with 
the Court, entry of this Final Judgment is in the public interest.

DATED:-----------------------------------------------------------------

-----------------------------------------------------------------------
United States District Judge

Attachment 1

Settlement Agreement

    This Settlement Agreement (Agreement) is entered into among the 
United States of America, acting through the Civil Division of the 
United States Department of Justice and the United States Attorney's 
Office for the Southern District of Ohio, on behalf of the Defense 
Logistics Agency (DLA) and the Army and Air Force Exchange Service 
(AAFES) (collectively the ``United States''), Jier Shin Korea (Jier 
Shin) and Sang Joo Lee, and Relator [REDACTED] (hereafter collectively 
referred to as ``the Parties''), through their authorized 
representatives.

Recitals

    A. Jier Shin is a South Korea-based logistics company. Sang Joo Lee 
is the President of Jier Shin and a shareholder.
    B. On February 28, 2018, Relator, a resident and citizen of South 
Korea, filed a qui tam action in the United States District Court for 
the Southern District of Ohio captioned United States ex rel. 
[REDACTED] v. GS Caltex, et al., Civil Action No. [REDACTED], pursuant 
to the qui tam provisions of the False Claims Act, 31 U.S.C. 3730(b) 
(the Civil FCA Action). Relator contends that Jier Shin conspired with 
other South Korean entities to rig bids on Department of Defense 
contracts to supply fuel to U.S. military bases throughout South Korea 
beginning in 2005 and continuing until 2016, including DLA Post, Camps, 
and Stations contracts executed in 2006, 2009, 2011, and 2013, and 
AAFES contracts executed in 2008.
    C. Jier Shin and Sang Joo Lee will execute a Stipulation with the 
Antitrust Division of the United States Department of Justice in which 
Jier Shin and Sang Joo Lee will consent to the entry of a Final 
Judgment to be filed in United States v. Jier Shin Korea, Civil Action 
No. [to be assigned] (S.D. Ohio) (the Civil Antitrust Action) that will 
settle any and all civil antitrust claims of the United States against 
Jier Shin and Sang Joo Lee arising from any act or offense committed 
before the date of the Stipulation that was undertaken in furtherance 
of an attempted or completed antitrust conspiracy involving PC&S and/or 
AAFES fuel supply contracts with the U.S. military in South Korea 
during the period 2005 through 2016.
    D. The United States contends that it has certain civil claims 
against Jier Shin and Sang Joo Lee arising from a

[[Page 21467]]

conspiracy among South Korean entities to rig bids on Department of 
Defense contracts to supply fuel to U.S. military bases throughout 
South Korea beginning in 2005 and continuing to 2016, including DLA 
Post, Camps, and Stations contracts executed in 2006, 2009, 2011, and 
2013, and AAFES contracts executed in 2008. The conduct described in in 
this Paragraph, as well as the conduct, actions, and claims alleged by 
Relator in the Civil FCA Action is referred to below as the Covered 
Conduct.
    E. This Settlement Agreement is neither an admission of liability 
by Jier Shin and Sang Joo Lee nor a concession by the United States or 
Relator that their claims are not well founded.
    F. Relator claims entitlement under 31 U.S.C. 3730(d) to a share of 
the proceeds of this Settlement Agreement and to Relator's reasonable 
expenses, attorneys' fees, and costs.
    To avoid the delay, uncertainty, inconvenience, and expense of 
protracted litigation of the above claims, and in consideration of the 
mutual promises and obligations of this Settlement Agreement, the 
Parties agree and covenant as follows:

Terms and Conditions

    1. Jier Shin and Sang Joo Lee jointly and severally agree to pay to 
the United States five hundred thousand dollars ($500,000) by 
electronic funds transfer no later than ten (10) business days after 
the Effective Date of this Agreement pursuant to written instructions 
to be provided by the Civil Division of the United States Department of 
Justice (Initial Payment). Jier Shin and Sang Joo Lee jointly and 
severally agree to pay to the United States five-hundred thousand 
dollars ($500,000) by electronic funds transfer no later than sixty 
(60) days after the Effective Date of this Agreement (Second Payment). 
Jier Shin and Sang Joo Lee jointly and severally agree to pay to the 
United States five-hundred thousand dollars ($500,000) by electronic 
funds transfer no later than one (1) year after the Effective Date of 
this Agreement (Third Payment). Jier Shin and Sang Joo Lee jointly and 
severally agree to pay to the United States five-hundred thousand 
dollars ($500,000) by electronic funds transfer no later than two (2) 
years after the Effective Date of this Agreement (Final Payment). The 
sum of the Initial Payment, Second Payment, Third Payment, and Final 
Payment shall constitute the FCA Settlement Amount. Relator claims 
entitlement under 31 U.S.C. 3730(d) to Relator's reasonable expenses, 
attorneys' fees and costs. The FCA Settlement Amount does not include 
the Relator's fees and costs, and Jier Shin and Sang Joo Lee 
acknowledge (without waiving any applicable arguments or defenses) that 
Relator retains all rights to seek to recover such expenses, attorneys' 
fees, and costs from Jier Shin pursuant to 31 U.S.C. 3730(d).
    2. Subject to the exceptions in Paragraph 4 (concerning excluded 
claims) below, and conditioned upon Jier Shin and Sang Joo Lee's full 
payment of the FCA Settlement Amount, the United States releases Sang 
Joo Lee and Jier Shin together with its current and former parent 
corporations; direct and indirect subsidiaries; brother or sister 
corporations; divisions; current or former corporate owners; and the 
corporate successors and assigns of any of them from any civil or 
administrative monetary claim the United States has for the Covered 
Conduct under the False Claims Act, 31 U.S.C. 3729-3733; the Program 
Fraud Civil Remedies Act, 31 U.S.C. 3801-3812; Contract Disputes Act, 
41 U.S.C. 7101-7109; or the common law theories of breach of contract, 
payment by mistake, unjust enrichment, and fraud.
    3. Except as set forth in Paragraph 1 (concerning Relator's claims 
under 31 U.S.C. 3730(d)), and subject to the exceptions in Paragraph 4 
below, and conditioned upon Sang Joo Lee and Jier Shin's full payment 
of the FCA Settlement Amount, Relator, on behalf of: (a) His respective 
heirs, successors, assigns, agents and attorneys; and (b) his 
companies, [REDACTED], together with their direct and indirect 
subsidiaries, brother or sister corporations, divisions, current or 
former corporate owners, and the corporate successors and assigns of 
any of them); hereby fully and finally releases, waives, and forever 
discharges Sang Joo Lee and Jier Shin, together with its direct and 
indirect subsidiaries, brother or sister corporations, divisions, 
current or former corporate owners, and the corporate successors and 
assigns of any of them, from: (i) Any civil monetary claim Relator has 
on behalf of the United States for the Covered Conduct under the False 
Claims Act, 31 U.S.C. 3729-3733; (ii) any claims or allegations Relator 
has asserted or could have asserted against Sang Joo Lee and Jier Shin 
arising from the Covered Conduct; and (iii) all liability, claims, 
demands, actions or causes of action whatsoever, whether known or 
unknown, fixed or contingent, in law or in equity, in contract or in 
tort, under any federal, Korean, or state statute or regulation or 
otherwise, or in common law, including claims for attorneys' fees, 
costs, and expenses of every kind and however denominated, that Relator 
would have standing to bring or which Relator may now have or claim to 
have against Sang Joo Lee and Jier Shin and/or its direct and indirect 
subsidiaries, brother or sister corporations, divisions, current or 
former corporate owners, and the corporate successors and assigns of 
any of them.
    4. Notwithstanding the releases given in paragraphs 2 and 3 of this 
Agreement, or any other term of this Agreement, the following claims of 
the United States are specifically reserved and are not released:
    a. Any liability arising under Title 26, U.S. Code (Internal 
Revenue Code);
    b. Any criminal liability;
    c. Except as explicitly stated in this Agreement, any 
administrative liability, including the suspension and debarment rights 
of any federal agency;
    d. Any liability to the United States (or its agencies) for any 
conduct other than the Covered Conduct;
    e. Any liability based upon obligations created by this Agreement;
    f. Any liability of individuals other than Sang Joo Lee;
    g. Any liability for express or implied warranty claims or other 
claims for defective or deficient products or services, including 
quality of goods and services;
    h. Any liability for failure to deliver goods or services due; and
    i. Any liability for personal injury or property damage or for 
other consequential damages arising from the Covered Conduct.
    5. Relator and his heirs, successors, attorneys, agents, and 
assigns shall not object to this Agreement but agree and confirm that 
this Agreement is fair, adequate, and reasonable under all the 
circumstances, pursuant to 31 U.S.C. 3730(c)(2)(B). In connection with 
this Agreement and this Civil FCA Action, Relator, on behalf of himself 
and his heirs, successors, attorneys, agents, and assigns, agrees that 
neither this Agreement, nor any intervention by the United States in 
the Civil FCA Action in order to dismiss the Civil FCA Action, nor any 
dismissal of the Civil FCA Action, shall waive or otherwise affect the 
ability of the United States to contend that provisions in the False 
Claims Act, including 31 U.S.C. 3730(d)(3), bar Relator from sharing in 
the proceeds of this Agreement, except that the United States will not 
contend that Relator is barred from sharing in the proceeds of this 
agreement under 31 U.S.C. 3730(e)(4). Moreover, the United States and 
Relator, on behalf of himself and his heirs, successors, attorneys, 
agents, and assigns agree that they each retain all of their rights 
pursuant to the False Claims Act on the issue of the share percentage, 
if any, that Relator

[[Page 21468]]

should receive of any proceeds of the settlement of his claims, and 
that no agreements concerning Relator share have been reached to date.
    6. Jier Shin and Sang Joo Lee waive and shall not assert any 
defenses Jier Shin and Sang Joo Lee may have to any criminal 
prosecution or administrative action relating to the Covered Conduct 
that may be based in whole or in part on a contention that, under the 
Double Jeopardy Clause in the Fifth Amendment of the Constitution, or 
under the Excessive Fines Clause in the Eighth Amendment of the 
Constitution, this Agreement bars a remedy sought in such criminal 
prosecution or administrative action.
    7. Jier Shin and Sang Joo Lee fully and finally release the United 
States, its agencies, officers, agents, employees, and servants, from 
any claims (including attorney's fees, costs, and expenses of every 
kind and however denominated) that Jier Shin and Sang Joo Lee have 
asserted, could have asserted, or may assert in the future against the 
United States, its agencies, officers, agents, employees, and servants, 
related to the Covered Conduct and the United States' investigation and 
prosecution thereof.
    8. Sang Joo Lee and Jier Shin, together with its direct and 
indirect subsidiaries, brother or sister corporations, divisions, 
current or former corporate owners, and the corporate successors and 
assigns of any of them, hereby fully and finally releases, waives, and 
forever discharges the Relator, together with his respective heirs, 
successors, assigns, agents and attorneys, and his companies 
([REDACTED]) from any claims or allegations Jier Shin or Sang Joo Lee 
has asserted or could have asserted, arising from the Covered Conduct, 
and from all liability, claims, demands, actions or causes of action 
whatsoever arising from or in any manner related to the Covered 
Conduct, whether known or unknown, fixed or contingent, in law or in 
equity, in contract or in tort, under any federal, Korean, or state 
statute or regulation or otherwise, or in common law, including claims 
for attorneys' fees, costs, and expenses of every kind and however 
denominated, that it would have standing to bring or which Jier Shin or 
Sang Joo Lee may now have or claim to have against Relator and his 
heirs, successors, assigns, agents, and attorneys.
    9. a. Unallowable Costs Defined: All costs (as defined in the 
Federal Acquisition Regulation, 48 CFR 31.205-47) incurred by or on 
behalf of Sang Joo Lee and Jier Shin, and its present or former 
officers, directors, employees, shareholders, and agents in connection 
with:
    (1) The matters covered by this Agreement and any related civil 
antitrust agreement;
    (2) the United States' audit(s) and civil and any criminal 
investigation(s) of the matters covered by this Agreement;
    (3) Sang Joo Lee and Jier Shin's investigation, defense, and 
corrective actions undertaken in response to the United States' 
audit(s) and civil and any criminal investigation(s) in connection with 
the matters covered by this Agreement (including attorney's fees);
    (4) the negotiation and performance of this Agreement and any 
related civil antitrust agreement;
    (5) the payments that Sang Joo Lee and Jier Shin make to the United 
States pursuant to this Agreement and any payments that Jier Shin may 
make to Relator, including costs and attorneys' fees,

are unallowable costs for government contracting purposes (hereinafter 
referred to as Unallowable Costs).
    b. Future Treatment of Unallowable Costs: Unallowable Costs will be 
separately determined and accounted for by Sang Joo Lee and Jier Shin, 
and Sang Joo Lee and Jier Shin shall not charge such Unallowable Costs 
directly or indirectly to any contract with the United States.
    c. Treatment of Unallowable Costs Previously Submitted for Payment: 
Within 90 days of the Effective Date of this Agreement, Sang Joo Lee 
and Jier Shin shall identify and repay by adjustment to future claims 
for payment or otherwise any Unallowable Costs included in payments 
previously sought by Sang Joo Lee and Jier Shin or any of its 
subsidiaries or affiliates from the United States. Sang Joo Lee and 
Jier Shin agree that the United States, at a minimum, shall be entitled 
to recoup from Jier Shin any overpayment plus applicable interest and 
penalties as a result of the inclusion of such Unallowable Costs on 
previously-submitted requests for payment. The United States, including 
the Department of Justice and/or the affected agencies, reserves its 
rights to audit, examine, or re-examine Jier Shin's books and records 
and to disagree with any calculations submitted by Jier Shin or any of 
its subsidiaries or affiliates regarding any Unallowable Costs included 
in payments previously sought by Jier Shin, or the effect of any such 
Unallowable Costs on the amount of such payments.
    10. Jier Shin and Sang Joo Lee have provided sworn financial 
disclosure statements (Financial Statements) to the United States and 
the United States has relied on the accuracy and completeness of those 
Financial Statements in reaching this Agreement. Jier Shin and Sang Joo 
Lee warrant that the Financial Statements are complete, accurate, and 
current. If the United States learns of asset(s) in which Jier Shin and 
Sang Joo Lee had an interest at the time of this Agreement that were 
not disclosed in the Financial Statements, or if the United States 
learns of any misrepresentation by Jier Shin and Sang Joo Lee on, or in 
connection with, the Financial Statements, and if such nondisclosure or 
misrepresentation changes the estimated net worth set forth in the 
Financial Statements by $100,000 or more, the United States may at its 
option: (a) Rescind this Agreement and file suit based on the Covered 
Conduct, or (b) let the Agreement stand and collect the full Settlement 
Amount plus one hundred percent (100%) of the value of the net worth of 
Jier Shin and Sang Joo Lee previously undisclosed. Jier Shin and Sang 
Joo Lee agree not to contest any collection action undertaken by the 
United States pursuant to this provision, and immediately to pay the 
United States all reasonable costs incurred in such an action, 
including attorney's fees and expenses. The United States agrees to 
notify Relator if the United States invokes either of its options 
pursuant to this paragraph. Nothing in this agreement shall be 
interpreted as a waiver of Relator's right to request a share of any 
proceeds collected by the United States pursuant to this paragraph.
    11. In the event that the United States, pursuant to Paragraph 10 
(concerning disclosure of assets), above, opts to rescind this 
Agreement, Jier Shin and Sang Joo Lee agree not to plead, argue, or 
otherwise raise any defenses under the theories of statute of 
limitations, laches, estoppel, or similar theories, to any civil or 
administrative claims that (a) are filed by the United States within 60 
calendar days of written notification to Jier Shin and Sang Joo Lee 
that this Agreement has been rescinded, and (b) relate to the Covered 
Conduct, except to the extent these defenses were available on the 
Effective Date of this Agreement.
    12. Sang Joo Lee and Jier Shin agree to cooperate fully and 
truthfully with the United States in connection with the Civil FCA 
Action. Sang Joo Lee and Jier Shin's ongoing, full, and truthful 
cooperation shall include, but not be limited to:
    a. Upon request by the United States with reasonable notice, 
producing at the offices of counsel for the United States in 
Washington, DC and not at the expense of the United States, complete

[[Page 21469]]

and un-redacted copies of all non-privileged documents related to the 
Covered Conduct wherever located in Sang Joo Lee and Jier Shin's 
possession, custody, or control, including but not limited to, reports, 
memoranda of interviews, and records concerning any investigation of 
the Covered Conduct that Sang Joo Lee and Jier Shin have undertaken, or 
that has been performed by another on Sang Joo Lee and Jier Shin's 
behalf;
    b. upon request by the United States with reasonable notice, making 
Hyun Dae Shin, Sang Joo Lee, and current Jier Shin directors, officers, 
and employees available for interviews, consistent with the rights and 
privileges of such individuals, by counsel for the United States and/or 
their investigative agents, not at the expense of the United States, in 
the United States or Taiwan, unless another place is mutually agreed 
upon;
    c. upon request by the United States with reasonable notice, (i) 
using best efforts to assist in locating former Jier Shin directors, 
officers, and employees identified by attorneys and/or investigative 
agents of the United States, and (ii) using best efforts to make any 
such former Jier Shin directors, officers, and employees available for 
interviews, consistent with the rights and privileges of such 
individuals, by counsel for the United States and/or their 
investigative agents, not at the expense of the United States, in the 
United States or Taiwan, unless another place is mutually agreed upon; 
and
    d. upon request by the United States with reasonable notice, making 
Hyun Dae Shin, Sang Joo Lee, and current Jier Shin directors, officers, 
and employees available, and using best efforts to make former Jier 
Shin directors, officers, employees available, to testify, consistent 
with the rights and privileges of such individuals, fully, truthfully, 
and under oath, without falsely implicating any person or withholding 
any information, (i) at depositions in the United States, Taiwan, or 
any other mutually agreed upon place, (ii) at trial in the United 
States, (iii) at any other judicial proceedings wherever located 
related to the Civil FCA Action, and (iv) by declaration or affidavit 
executed in compliance with 28 U.S.C. 1746.
    13. This Agreement is intended to be for the benefit of the Parties 
only.
    14. Upon receipt of the Initial Payment of the FCA Settlement 
Amount described in Paragraph 1 above, the United States and Relator 
shall promptly sign and file a Joint Stipulation of Dismissal, with 
prejudice, of the claims filed against Jier Shin in the Civil FCA 
Action, pursuant to Rule 41(a)(1), which dismissal shall be subject to 
the terms of this Agreement, including full payment of the FCA 
Settlement Amount, and conditioned on the Court retaining jurisdiction 
over Relator's claims to a relator's share and recovery of attorneys' 
fees and costs pursuant to 31 U.S.C. 3730(d).
    15. Except with respect to payment (if any) by Jier Shin of 
Relator's attorneys' fees, expenses, and costs pursuant to 31 U.S.C. 
3730(d), each Party shall bear its own legal and other costs incurred 
in connection with this matter. The Parties agree that Relator, Jier 
Shin, and Sang Joo Lee will not seek to recover from the United States 
any costs or fees related to the preparation and performance of this 
Agreement.
    16. Each party and signatory to this Agreement represents that it 
freely and voluntarily enters in to this Agreement without any degree 
of duress or compulsion.
    17. This Agreement is governed by the laws of the United States. 
The exclusive jurisdiction and venue for any dispute relating to this 
Agreement is the United States District Court for the Southern District 
of Ohio. Jier Shin and Sang Joo Lee agree that the United States 
District Court for the Southern District of Ohio has jurisdiction over 
it for purposes of this Agreement. For purposes of construing this 
Agreement, this Agreement shall be deemed to have been drafted by all 
Parties to this Agreement and shall not, therefore, be construed 
against any Party for that reason in any subsequent dispute.
    18. This Agreement constitutes the complete agreement between the 
Parties on the subject matters addressed herein. This Agreement may not 
be amended except by written consent of the Parties.
    19. The undersigned counsel represent and warrant that they are 
fully authorized to execute this Agreement on behalf of the persons and 
entities indicated below.
    20. This Agreement may be executed in counterparts, each of which 
constitutes an original and all of which constitute one and the same 
Agreement.
    21. This Agreement is binding on Sang Joo Lee and Jier Shin's 
successors, transferees, heirs, and assigns.
    22. This Agreement is binding on Relator's successors, transferees, 
heirs, and assigns.
    23. All parties consent to the United States' disclosure of this 
Agreement, and information about this Agreement, to the public, as 
permitted by order of the Court. This Agreement shall not be released 
in un-redacted form until the Court unseals the entire Civil FCA 
Action.
    24. This Agreement is effective on the date of signature of the 
last signatory to the Agreement (Effective Date of this Agreement). 
Facsimiles of signatures shall constitute acceptable, binding 
signatures for purposes of this Agreement.

THE UNITED STATES OF AMERICA

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Andrew A. Steinberg,
Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. 
Department of Justice.

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Mark T. D'Alessandro,
Civil Chief.
Andrew Malek,
Assistant United States Attorney, U.S. Attorney's Office for the 
Southern District of Ohio.

JIER SHIN KOREA

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Sang Joo Lee,
Authorized Representative of Jier Shin Korea.

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Mark Rosman,
Counsel for Jier Shin Korea.

SANG JOO LEE

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Sang Joo Lee

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Mark Rosman,
Counsel for Sang Joo Lee.

RELATOR [REDACTED]

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
[REDACTED]

Dated:-----------------------------------------------------------------

By:--------------------------------------------------------------------
Eric R. Havian,
Constantine Cannon LLP, Counsel for Relator.

United States District Court for the Southern District of Ohio Eastern 
Division

    United States of America, Plaintiff, v. Jier Shin Korea Co., 
Ltd., and Sang Joo Lee, Defendants.

Case No. 2:20-cv-1788

Competitive Impact Statement

    The United States of America, under Section 2(b) of the Antitrust 
Procedures and Penalties Act, 15 U.S.C. 16(b)-(h) (the ``APPA'' or 
``Tunney Act''), files this Competitive Impact Statement relating to 
the proposed Final Judgment submitted for entry in this civil antitrust 
proceeding.

I. Nature and Purpose of the Proceeding

    On April 8, 2020, the United States filed a civil antitrust 
complaint against

[[Page 21470]]

Defendants Jier Shin Korea Co., Ltd. (``Jier Shin Korea'') and Sang Joo 
Lee alleging that Defendants violated Section 1 of the Sherman Act, 15 
U.S.C. 1. From at least March 2005 and continuing until at least 
October 2016 (``the Relevant Period''), Defendants and their co-
conspirators conspired to fix prices and rig bids for the supply of 
fuel to the U.S. military for its operations in South Korea. As a 
result of this illegal conduct, Defendants and their co-conspirators 
overcharged American taxpayers by well over $100 million.
    At the same time the Complaint was filed, the United States also 
filed an agreed-upon proposed Final Judgment that would remedy 
Defendants' violation by having Jier Shin Korea and Sang Joo Lee 
jointly and severally pay $2,000,000 to the United States. This payment 
resolves the civil claims of the United States against Defendants 
related to the conduct described in the Complaint. The United States 
and Defendants have stipulated that the proposed Final Judgment may be 
entered after compliance with the APPA. Entry of the proposed Final 
Judgment will terminate this action, except that the Court will retain 
jurisdiction to construe, modify, or enforce the provisions of the 
proposed Final Judgment and to punish violations thereof.

II. Description of the Events Giving Rise to the Alleged Violation

A. Defendants

    Jier Shin Korea is a small, privately held logistics company 
located in Seoul, South Korea. Sang Joo Lee is the president of Jier 
Shin Korea. Jier Shin Korea is a closely held firm majority owned by 
Lee and his family. Jier Shin Korea provides logistics services related 
to the transportation of fuel, petroleum by-products, and other goods. 
During the conspiracy, Jier Shin Korea partnered with a South Korean 
oil refiner, Hyundai Oilbank Co., Ltd. (``Hyundai Oilbank''), to supply 
fuel to U.S. military installations in South Korea, with Jier Shin 
Korea acting as the prime contractor under the relevant contracts.
    Other persons, not named as defendants in this action, participated 
as co-conspirators in the violation alleged in the Complaint and 
performed acts and made statements in furtherance thereof. These co-
conspirators included, among others, GS Caltex Corporation (``GS 
Caltex''), Hanjin Transportation Co., Ltd. (``Hanjin''), SK Energy Co., 
Ltd. (``SK Energy''), Hyundai Oilbank, and S-Oil Corporation (``S-
Oil'').
    On December 12, 2018, GS Caltex, Hanjin, and SK Energy pleaded 
guilty to an information charging a criminal violation of Section 1 of 
the Sherman Act for this unlawful conduct. See United States v. GS 
Caltex Corporation, No. 2:18-cr-240 (S.D. Ohio, filed November 14, 
2018); United States v. Hanjin Transportation Co., Ltd., No. 2:18-cr-
241 (S.D. Ohio, filed November 14, 2018); United States v. SK Energy 
Company, No. 2:18-cr-239 (S.D. Ohio, filed November 14, 2018). GS 
Caltex, Hanjin, and SK Energy have also settled civil claims brought by 
the United States in a separately filed civil action relating to the 
same conduct. See United States v. GS Caltex Corp. et al., No. 2:18-cv-
1456 (S.D. Ohio, filed November 14, 2018).
    On March 20, 2019, Hyundai Oilbank and S-Oil pleaded guilty to 
Count One of a Superseding Indictment charging a criminal violation of 
Section 1 of the Sherman Act for this unlawful conduct. See United 
States v. Kim et al., No. 2:18-cr-152 (S.D. Ohio, filed September 27, 
2018). Hyundai Oilbank and S-Oil have also settled civil claims brought 
by the United States in a separately filed civil action relating to the 
same conduct. See United States v. Hyundai Oilbank and S-Oil Corp., No. 
2:19-cv-01037 (S.D. Ohio, filed March 20, 2019).

B. PC&S and AAFES Contracts

    The United States military procures fuel for its installations in 
South Korea through competitive solicitation processes. Oil companies, 
either independently or with a transportation company, submitted bids 
in response to these solicitations.
    The conduct at issue in this action relates to two types of 
contracts to supply fuel to the U.S. military in South Korea: Post, 
Camps, and Stations (``PC&S'') contracts and Army and Air Force 
Exchange Services (``AAFES'') contracts.
    PC&S contracts are issued and administered by the Defense Logistics 
Agency (``DLA''), a combat support agency of the U.S. Department of 
Defense. The fuel procured under PC&S contracts is used to power 
military vehicles and heat U.S. military buildings. During the Relevant 
Period, DLA issued PC&S solicitations listing the fuel requirements for 
installations across South Korea, with each delivery location 
identified by a separate line item. Bidders submitted initial bids, 
offering a price for each line item on which they chose to bid. After 
DLA reviewed the initial bids, bidders were allowed to submit revised 
final bids. DLA reviewed the bids and awarded contracts to the bidders 
offering the lowest price for each line item. Payments under the PC&S 
contracts were wired to the awardees by a finance and accounting agency 
of the U.S. Department of Defense from its office in Columbus, Ohio.
    AAFES is an agency of the Department of Defense headquartered in 
Dallas, Texas. AAFES operates official retail stores (known as 
``exchanges'') on U.S. Army and Air Force installations worldwide, 
which U.S. military personnel and their families use to purchase 
everyday goods and services, including gasoline for use in their 
personal vehicles. AAFES procures fuel for these stores via contracts 
awarded through a competitive solicitation process.
    In 2008, AAFES issued a solicitation that listed the fuel 
requirements for installations in South Korea. Bidders submitted bids 
offering a price for each line item in the solicitation. Unlike DLA, 
AAFES awarded the entire 2008 contract to the bidder offering the 
lowest price across all the listed locations.

C. The Alleged Violation

    The Complaint alleges that Defendants and their co-conspirators 
engaged in a series of meetings, telephone conversations, emails, and 
other communications to rig bids and fix prices for the supply of fuel 
to U.S. military installations in South Korea under several PC&S and 
AAFES contracts.
    First, the Complaint alleges that GS Caltex, SK Energy, Hyundai 
Oilbank, and Jier Shin Korea (including by, through, and with the 
knowledge of, its president Sang Joo Lee) conspired to rig bids and fix 
prices on the contracts issued in response to DLA solicitations SP0600-
05-R-0063 and SP0600-05-R-0063-0001 (``2006 PC&S contracts''). The term 
of the 2006 PC&S contracts covered the supply of fuel from February 
2006 through July 2009.
    The Complaint alleges that between early 2005 and mid-2006, GS 
Caltex, SK Energy, Hyundai Oilbank, and Jier Shin Korea met multiple 
times and exchanged phone calls and emails to allocate the line items 
in the solicitations for the 2006 PC&S contracts. Through such 
communications, these conspirators agreed to inflate their bids to 
produce larger profit margins. For each line item allocated to a 
different co-conspirator, the other conspirators agreed not to bid or 
to bid high enough to ensure that they would not win that item. DLA 
awarded the 2006 PC&S line items according to the allocations made by 
the conspiracy.

[[Page 21471]]

    Second, the Complaint alleges that, as part of their discussions 
related to the 2006 PC&S contracts, GS Caltex, Hyundai Oilbank, and 
Jier Shin Korea agreed not to compete with SK Energy in bidding for the 
June 2008 AAFES solicitation (``2008 AAFES contract''). The initial 
term of the 2008 AAFES contract ran from July 2008 to July 2010; the 
contract was later extended through July 2013.
    Third, the Complaint alleges that Jier Shin Korea and other co-
conspirators conspired to rig bids and fix prices for the contracts 
issued in response to DLA solicitation SP0600-08-R-0233 (``2009 PC&S 
contracts''). Hanjin and S-Oil joined the conspiracy for the purpose of 
bidding on SP0600-08-R-0233. The term of the 2009 PC&S contracts 
covered the supply of fuel from October 2009 through August 2013.
    The Complaint explains that between late 2008 and mid-2009, Jier 
Shin Korea and other co-conspirators met multiple times and exchanged 
phone calls and emails to allocate the line items in the solicitation 
for the 2009 PC&S contracts. As in 2006, these conspirators agreed to 
bid high so as to not win line items allocated to other co-
conspirators. The original conspirators agreed to allocate to Hanjin 
and S-Oil certain line items that had previously been allocated to the 
original conspirators.
    Finally, the Complaint alleges that Jier Shin Korea and other co-
conspirators once again conspired to rig bids and fix prices for the 
contracts issued in response to DLA solicitation SP0600-12-R-0332 
(``2013 PC&S contracts''). The term of the 2013 PC&S contracts covered 
the supply of fuel from August 2013 through July 2016.
    The Complaint explains that Jier Shin Korea and other co-
conspirators communicated via phone calls and emails to allocate and 
set the price for each line item in the solicitation for the 2013 PC&S 
contracts. Jier Shin Korea and other co-conspirators believed that they 
had an agreement as to their bidding strategy and pricing for the 2013 
PC&S contracts. As a result of this agreement, they submitted bids with 
pricing above what they would have offered absent collusion.
    Hanjin and S-Oil submitted bids for the 2013 PC&S contracts below 
the prices set by the other co-conspirators, however. Although lower 
than the pricing agreed upon by the conspirators, Hanjin and S-Oil 
still submitted bids above a competitive, non-collusive price, knowing 
that they would likely win the contracts because the other conspirators 
would bid even higher prices.

III. Explanation of the Proposed Final Judgment

    For violations of Section 1 of the Sherman Act, the United States 
may seek damages, 15 U.S.C. 15a, and equitable relief, 15 U.S.C. 4, 
including equitable monetary remedies. See United States v. KeySpan 
Corp., 763 F. Supp. 2d 633, 638-641 (S.D.N.Y. 2011).
    This action is related to three civil actions based on the same 
facts alleged in the Complaint and filed in the United States District 
Court for the Southern District of Ohio: (1) United States v. GS Caltex 
Corp. et al., No. 2:18-cv-1456, which seeks recovery from one set of 
co-conspirators; (2) United States v. Hyundai Oilbank Co., Ltd. et al., 
No 2:19-cv-1037, which seeks recovery from a different set of co-
conspirators; and (3) a qui tam action currently filed under seal, 
alleging a violation of the False Claims Act, 31 U.S.C. 3730.

A. Payment and Cooperation

    The proposed Final Judgment requires Jier Shin Korea and Sang Joo 
Lee jointly and severally to pay $2,000,000 to the United States in 
three installments: The first installment of $1,000,000 is due within 
10 business days of entry of the Final Judgment; the second installment 
of $500,000 is due within one year of the entry of the Final Judgment; 
and the third installment of $500,000 is due within two years of the 
entry of the Final Judgment. These payments will satisfy all civil 
claims arising from the events described in Section II supra that the 
United States has against Defendants under Section 1 of the Sherman Act 
and under the False Claims Act. The resolution of the United States' 
claims under the False Claims Act is set forth in a separate agreement 
reached between Defendants, the U.S. Attorney's Office for the Southern 
District of Ohio, and the U.S. Department of Justice's Civil Division. 
See Attachment 1 of the proposed Final Judgment.
    As a result of the unlawful agreements in restraint of trade 
between Defendants and their co-conspirators, the United States paid 
more for the supply of fuel to U.S. military installations in South 
Korea than it would have if the companies had engaged in fair and 
honest competition. Defendants' payments under the proposed Final 
Judgments compensate the United States for a portion of the losses it 
suffered as a result of the conspiracy. In addition to the payment of 
damages, the proposed Final Judgment also requires Defendants to 
cooperate with the United States regarding any ongoing civil 
investigation, litigation, or other proceeding arising out of any 
ongoing federal investigation of the subject matter discussed in the 
Complaint. To assist with these proceedings, Defendants are required to 
provide all non-privileged information in their possession, make 
available Jier Shin Korea's present employees (including Lee), and use 
best efforts to make available Jier Shin Korea's former employees, for 
interviews or testimony, as requested by the United States.
    Under Section 4A of the Clayton Act, the United States is entitled 
to treble damages for injuries it has suffered as a result of 
violations of the Sherman Act. The United States agreed to accept the 
damages amount from Defendants based on several considerations. First, 
the United States considered how much Defendants individually profited 
from the conspiracy. Second, the United States considered the risks of 
pursuing contested litigation and obtaining recovery from Defendants. 
Third, the United States considered the cooperation and assistance 
offered by the Defendants to date. Under an ongoing agreement to 
cooperate entered into at an early stage of the United States' 
investigation of the bid rigging activity, Defendants have provided and 
continue to provide information that has benefited the United States' 
civil investigations. This information and cooperation assisted the 
United States in obtaining settlements from Defendants' co-conspirators 
totaling over $205 million--substantially more than the total damages 
suffered by the United States as a result of the conspiracy. Finally, 
the amount reflects the Defendants' demonstration, through the 
submission of extensive financial information, that they are unable to 
pay the full amount of damages to which the United States is entitled. 
The proposed Final Judgment specifies that if the United States 
discovers any material misrepresentation in these financial statements, 
the United States may recover the full amount by which the Defendants 
understated their ability to pay, plus the United States' attorneys 
fees and costs associated with obtaining such additional recovery.
    The proposed Final Judgment also requires Jier Shin Korea to 
appoint an Antitrust Compliance Officer and to institute an antitrust 
compliance program. Under the antitrust compliance program, employees 
and directors of Jier Shin Korea must undergo training and all 
employees must be informed that there will no reprisal for disclosing 
to the Antitrust Compliance Officer any potential violations of the 
United States antitrust laws. The Antitrust Compliance Officer is 
required annually to certify to the

[[Page 21472]]

United States that Jier Shin Korea is in compliance with this 
requirement.

B. Enforcement of Final Judgment

    The proposed Final Judgment contains provisions designed to promote 
compliance and make the enforcement of the Final Judgment as effective 
as possible. Paragraph VII(A) provides that the United States retains 
and reserves all rights to enforce the provisions of the proposed Final 
Judgment, including its rights to seek an order of contempt from the 
Court. Defendants have agreed that in any civil contempt action, any 
motion to show cause, or any similar action brought by the United 
States regarding an alleged violation of the Final Judgment, the United 
States may establish the violation and the appropriateness of any 
remedy by a preponderance of the evidence and that Defendants have 
waived any argument that a different standard of proof should apply. 
This provision aligns the standard for compliance obligations with the 
standard of proof that applies to the underlying offense that the 
compliance commitments address.
    Paragraph VII(B) provides additional clarification regarding the 
interpretation of the provisions of the proposed Final Judgment. The 
proposed Final Judgment was drafted to restore competition the United 
States alleged was harmed by Defendants' challenged conduct. Defendants 
agree that they will abide by the proposed Final Judgment, and that 
they may be held in contempt of this Court for failing to comply with 
any provision of the proposed Final Judgment that is stated 
specifically and in reasonable detail, as interpreted in light of this 
procompetitive purpose.
    Paragraph VII(C) of the proposed Final Judgment provides that if 
the Court finds in an enforcement proceeding that a Defendant has 
violated the Final Judgment, the United States may apply to the Court 
for a one-time extension of the Final Judgment, together with such 
other relief as may be appropriate. In addition, to compensate American 
taxpayers for any costs associated with investigating and enforcing 
violations of the proposed Final Judgment, Paragraph VII(C) provides 
that in any successful effort by the United States to enforce the Final 
Judgment against a Defendant, whether litigated or resolved before 
litigation, that Defendants will reimburse the United States for 
attorneys' fees, experts' fees, and other costs incurred in connection 
with any enforcement effort, including the investigation of the 
potential violation.
    Finally, Section VIII of the proposed Final Judgment provides that 
the Final Judgment will expire seven years from the date of its entry, 
except that after five years from the date of its entry, the Final 
Judgment may be terminated upon notice by the United States to the 
Court and Defendants that the continuation of the Final Judgment is no 
longer necessary or in the public interest.

IV. Remedies Available to Potential Private Litigants

    Entry of the proposed Final Judgment will neither impair nor assist 
the bringing of any private antitrust damages action. Under the 
provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the 
proposed Final Judgment has no prima facie effect in any subsequent 
private lawsuit that may be brought against Defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States and Defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date of publication of this Competitive 
Impact Statement in the Federal Register, or the last date of 
publication in a newspaper of the summary of this Competitive Impact 
Statement, whichever is later. All comments received during this period 
will be considered by the U.S. Department of Justice, and the United 
States remains free to withdraw its consent to the proposed Final 
Judgment at any time before the Court's entry of the Final Judgment. 
The comments and the response of the United States will be filed with 
the Court. In addition, comments will be posted on the U.S. Department 
of Justice, Antitrust Division's internet website and, under certain 
circumstances, published in the Federal Register.
    Written comments should be submitted by mail to: Robert A. Lepore, 
Chief, Transportation, Energy & Agriculture Section, Antitrust 
Division, United States Department of Justice, 450 5th Street NW, Suite 
8000, Washington, DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    As an alternative to the proposed Final Judgment, the United States 
considered a full trial on the merits against Defendants. The United 
States is satisfied, however, that the relief in the proposed Final 
Judgment remedies the violation of the Sherman Act alleged in the 
Complaint. The proposed Final Judgment represents substantial monetary 
relief while avoiding the time, expense, and uncertainty of a full 
trial on the merits. Further, Defendants' cooperation with the civil 
investigation and any potential litigation will enhance the ability of 
the United States to resolve issues related to the civil investigation 
and any potential litigation.

VII. Standard of Review Under the APPA for the Proposed Final Judgment

    The Clayton Act, as amended by the APPA, requires that proposed 
consent judgments in antitrust cases brought by the United States be 
subject to a 60-day comment period, after which the Court shall 
determine whether entry of the proposed Final Judgment ``is in the 
public interest.'' 15 U.S.C. 16(e)(1). In making that determination, 
the Court, in accordance with the statute as amended in 2004, is 
required to consider:
    (A) The competitive impact of such judgment, including termination 
of alleged violations, provisions for enforcement and modification, 
duration of relief sought, anticipated effects of alternative remedies 
actually considered, whether its terms are ambiguous, and any other 
competitive considerations bearing upon the adequacy of such judgment 
that the court deems necessary to a determination of whether the 
consent judgment is in the public interest; and
    (B) the impact of entry of such judgment upon competition in the 
relevant market or markets, upon the public generally and individuals 
alleging specific injury from the violations set forth in the complaint 
including consideration of the public benefit, if any, to be derived 
from a determination of the issues at trial.

15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, 
the Court's inquiry is necessarily a limited one as the government is 
entitled to ``broad discretion to settle with the

[[Page 21473]]

defendant within the reaches of the public interest.'' United States v. 
Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); United States v. 
U.S. Airways Grp., Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 2014) 
(explaining that the ``court's inquiry is limited'' in Tunney Act 
settlements); United States v. InBev N.V./S.A., No. 08-1965 (JR), 2009 
U.S. Dist. LEXIS 84787, at *3 (D.D.C. Aug. 11, 2009) (noting that a 
court's review of a consent judgment is limited and only inquires 
``into whether the government's determination that the proposed 
remedies will cure the antitrust violations alleged in the complaint 
was reasonable, and whether the mechanism to enforce the final judgment 
are clear and manageable'').
    As the U.S. Court of Appeals for the District of Columbia Circuit 
has held, under the APPA a court considers, among other things, the 
relationship between the remedy secured and the specific allegations in 
the government's complaint, whether the proposed Final Judgment is 
sufficiently clear, whether its enforcement mechanisms are sufficient, 
and whether it may positively harm third parties. See Microsoft, 56 
F.3d at 1458-62. With respect to the adequacy of the relief secured by 
the proposed Final Judgment, a court may ``not to make de novo 
determination of facts and issues.'' United States v. W. Elec. Co., 993 
F.2d 1572, 1577 (D.C. Cir. 1993) (quotation marks omitted); see also 
Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F. 
Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F. 
Supp. 2d 10, 16 (D.D.C. 2000); InBev, 2009 U.S. Dist. LEXIS 84787, at 
*3. Instead, ``[t]he balancing of competing social and political 
interests affected by a proposed antitrust consent decree must be left, 
in the first instance, to the discretion of the Attorney General.'' W. 
Elec. Co., 993 F.2d at 1577 (quotation marks omitted). ``The court 
should bear in mind the flexibility of the public interest inquiry: The 
court's function is not to determine whether the resulting array of 
rights and liabilities is one that will best serve society, but only to 
confirm that the resulting settlement is within the reaches of the 
public interest.'' Microsoft, 56 F.3d at 1460 (quotation marks 
omitted). More demanding requirements would ``have enormous practical 
consequences for the government's ability to negotiate future 
settlements,'' contrary to congressional intent. Id. at 1456. ``The 
Tunney Act was not intended to create a disincentive to the use of the 
consent decree.'' Id.
    The United States' predictions about the efficacy of the remedy are 
to be afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at 
1461 (recognizing courts should give ``due respect to the Justice 
Department's . . . view of the nature of its case''); United States v. 
Iron Mountain, Inc., 217 F. Supp. 3d 146, 152-53 (D.D.C. 2016) (``In 
evaluating objections to settlement agreements under the Tunney Act, a 
court must be mindful that [t]he government need not prove that the 
settlements will perfectly remedy the alleged antitrust harms[;] it 
need only provide a factual basis for concluding that the settlements 
are reasonably adequate remedies for the alleged harms.'') (internal 
citations omitted); United States v. Republic Servs., Inc., 723 F. 
Supp. 2d 157, 160 (D.D.C. 2010) (noting ``the deferential review to 
which the government's proposed remedy is accorded''); United States v. 
Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (``A 
district court must accord due respect to the government's prediction 
as to the effect of proposed remedies, its perception of the market 
structure, and its view of the nature of the case''). The ultimate 
question is whether ``the remedies [obtained by the Final Judgment are] 
so inconsonant with the allegations charged as to fall outside of the 
`reaches of the public interest.' '' Microsoft, 56 F.3d at 1461 
(quoting W. Elec. Co., 900 F.2d at 309).
    Moreover, the Court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its complaint, and does not authorize the Court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459; see also U.S. Airways, 
38 F. Supp. 3d at 75 (noting that the court must simply determine 
whether there is a factual foundation for the government's decisions 
such that its conclusions regarding the proposed settlements are 
reasonable); InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (``the `public 
interest' is not to be measured by comparing the violations alleged in 
the complaint against those the court believes could have, or even 
should have, been alleged''). Because the ``court's authority to review 
the decree depends entirely on the government's exercising its 
prosecutorial discretion by bringing a case in the first place,'' it 
follows that ``the court is only authorized to review the decree 
itself,'' and not to ``effectively redraft the complaint'' to inquire 
into other matters that the United States did not pursue. Microsoft, 56 
F.3d at 1459-60.
    In its 2004 amendments to the APPA, Congress made clear its intent 
to preserve the practical benefits of using consent judgments proposed 
by the United States in antitrust enforcement, Public Law 108-237 Sec.  
221, and added the unambiguous instruction that ``[n]othing in this 
section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. 16(e)(2); see also U.S. Airways, 38 F. Supp. 3d 
at 76 (indicating that a court is not required to hold an evidentiary 
hearing or to permit intervenors as part of its review under the Tunney 
Act). This language explicitly wrote into the statute what Congress 
intended when it first enacted the Tunney Act in 1974. As Senator 
Tunney explained: ``[t]he court is nowhere compelled to go to trial or 
to engage in extended proceedings which might have the effect of 
vitiating the benefits of prompt and less costly settlement through the 
consent decree process.'' 119 Cong. Rec. 24,598 (1973) (statement of 
Sen. Tunney). ``A court can make its public interest determination 
based on the competitive impact statement and response to public 
comments alone.'' U.S. Airways, 38 F. Supp. 3d at 76 (citing Enova 
Corp., 107 F. Supp. 2d at 17).

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.

Dated: April 8, 2020.

Respectfully submitted,

David M. Devillers,
United States Attorney.


/s/ Andrew M. Malek,---------------------------------------------------

(Ohio Bar #0061442), Assistant United States Attorney, 303 Marconi 
Boulevard, Suite 200 Columbus, Ohio 43215, Tel: (614) 469-5715, Fax: 
(614) 469-2769, Email: [email protected].


/s/ J. Richard Doidge,-------------------------------------------------

Attorney U.S. Department of Justice, Antitrust Division, 450 5th 
Street NW, Suite 8000, Washington, DC 20530, Tel: (202) 514-8944, 
Fax: (202) 616-2441, Email: [email protected].

[FR Doc. 2020-08138 Filed 4-16-20; 8:45 am]
BILLING CODE 4410-11-P