[Congressional Record Volume 156, Number 59 (Monday, April 26, 2010)]
[Senate]
[Pages S2649-S2650]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KOHL (for himself, Mr. Leahy, and Mr. Hatch):
  S. 3259. A bill to amend subtitle A of the Antitrust Criminal Penalty 
Enhancement and Reform Act of 2004 to make the operation of such 
subtitle permanent law; to the Committee on the Judiciary.
  Mr. KOHL. Mr. President, I rise today to introduce the Antitrust 
Criminal Penalties Enforcement and Reform Act of 2004 Extension Act. 
This legislation makes permanent a critical component of the Antitrust 
Criminal Penalty Enforcement and Reform Act of 2004, set to expire on 
June 22, which encourages participation in the Antitrust Division's 
leniency program. As a result, the Justice Department will be able to 
continue to detect, investigate and aggressively prosecute price-fixing 
cartels which harm consumers.
  The Antitrust Division of the Department of Justice has long 
considered criminal cartel enforcement a top priority, and its 
Corporate Leniency Policy is an important tool in that enforcement. 
Criminal antitrust offenses are generally conspiracies among 
competitors to fix prices, rig bids, or allocate markets of customers. 
The Leniency Policy creates incentives for corporations to report their 
unlawful cartel conduct to the Division, by offering the possibility of 
immunity from criminal charges to the first-reporting corporation, as 
long as there is full cooperation. For more than 15 years, this policy 
has allowed the Division to uncover cartels affecting billions of 
dollars worth of commerce here in the United States, which has led to 
prosecutions resulting in record fines and jail sentences.
  An important part of the Division's Leniency Policy, added by the 
Antitrust Criminal Penalties Enforcement and Reform Act of 2004, limits 
the civil liability of leniency participants to the actual damages 
caused by that company--rather than triple the damages caused by the 
entire conspiracy, which is typical in civil antitrust lawsuits. This 
removed a significant disincentive to participation in the leniency 
program--the concern that, despite immunity from criminal charges, a 
participating corporation might still be on the hook for treble damages 
in any future antitrust lawsuits.
  Maintaining strong incentives to make use of the Leniency Policy 
provides important benefits to the victims of antitrust offenses, often 
consumers who paid artificially high prices. It makes it more likely 
that criminal antitrust violations will be reported and, as a result, 
consumers will be able to identify and recover their losses from paying 
illegally inflated prices. The policy also requires participants to 
cooperate with plaintiffs in any follow-on civil lawsuits, which makes 
it more likely that the plaintiff consumers will be able to build 
strong cases against all members of the conspiracy.
  Since the passage of ACPERA, the Antitrust Division has uncovered a 
number of significant cartel cases through its leniency program, 
including the air cargo investigation, which so far has yielded over a 
billion dollars in criminal fines. In that investigation, several 
airlines pled guilty to conspiring to fix international air cargo rates 
and international passenger fuel surcharges. Not only were criminal 
fines levied but one high-ranking executive pled guilty and agreed to 
serve 8 months in prison. In fiscal year 2004, before the passage of 
ACPERA, criminal antitrust fines totaled $350 million. Criminal 
antitrust fines in fiscal year 2009 surpassed $1 billion. Scott 
Hammond, the Deputy Assistant Attorney General for Criminal Enforcement 
in the Antitrust Division, has stated that the damages limitation has 
made its Corporate Leniency Program ``even more effective'' at 
detecting and prosecuting cartels. In fact, in the first 5 years after 
passage, leniency applications increased by 25 percent, and the 
Antitrust Division experienced ``unprecedented'' success in criminal 
enforcement.
  ACPERA's damages limitation is set to expire in June, so we must act 
quickly to extend it. Otherwise, the Justice Department will lose an 
important tool that it uses to investigate and prosecute criminal 
cartel activity. The strong evidence that this program works means it 
is time to make it permanent. Permanence will give all parties--the 
government, potential amnesty applicants, and potential private 
litigants--a clear sign that criminal cartel enforcement continues to 
be a top priority, and that the amnesty program is a key and continuing 
component of that enforcement program.

[[Page S2650]]

This certainty is likely to lead to increased participation in the 
amnesty program, the discovery of more cases, the receipt of more 
criminal fines, and a higher likelihood of consumers being able to 
recover their losses in civil litigation.
  Some have raised questions about whether the leniency program could 
be made more effective by changing the requirements for leniency 
applicants to cooperate in private litigation, or by increasing the 
incentive for whistleblowing. Currently, there is insufficient evidence 
to show that changes are needed and the Department of Justice is 
concerned that any changes could have the unintended consequence of 
reducing the incentives to use the Leniency Program. Therefore, at this 
time we are hesitant to tinker with success. However, in response to 
the concerns, the Antitrust Criminal Penalties Enforcement and Reform 
Act of 2004 Extension Act of 2010 requires a GAO study to consider the 
effectiveness of the incentives for leniency applicants to cooperate in 
private litigation, and specifically whether such cooperation is made 
in a timely fashion. The Antitrust Criminal Penalties Enforcement and 
Reform Act of 2004 is meant to facilitate both government and private 
enforcement of the antitrust laws, and the GAO study will shed some 
light on whether it strikes the correct balance. When we receive the 
study, we will review it and act accordingly, changing the law if 
necessary.
  I urge my colleagues to support this important legislation.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3259

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Antitrust Criminal Penalties 
     Enforcement and Reform Act of 2004 Extension Act of 2010''.

     SEC. 2. ELIMINATION OF SUNSET.

       The Antitrust Criminal Penalty Enhancement and Reform Act 
     of 2004 (15 U.S.C. 1 note) is amended by striking section 
     211.

     SEC. 3. EFFECTIVE DATE OF AMENDMENT.

       The amendment made by section 2 shall take effect 
     immediately before June 22, 2010.

     SEC. 4. GAO REPORT.

       Not later than 1 year after the date of enactment of this 
     Act, the Comptroller General shall submit a report to the 
     Committees on the Judiciary of the House of Representatives 
     and the Senate on the effectiveness of the Antitrust Criminal 
     Penalties Enforcement and Reform Act of 2004, both in 
     criminal investigation and enforcement by the Department of 
     Justice and in private civil actions. Such report shall 
     consider, inter alia, the effectiveness of incentives for 
     cooperation, and the timeliness of that cooperation, in 
     private civil actions.
                                 ______