83 FR 60306 - United States v. GS Caltex Corp. et al.; Proposed Final Judgments and Competitive Impact Statement
DEPARTMENT OF JUSTICE
Antitrust Division Federal Register Volume 83, Issue 226 (November 23, 2018)
Antitrust Division
Federal Register Volume 83, Issue 226 (November 23, 2018)
| Page Range | 60306-60327 | |
| FR Document | 2018-25461 |
[Federal Register Volume 83, Number 226 (Friday, November 23, 2018)] [Notices] [Pages 60306-60327] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-25461] [[Page 60305]] Vol. 83 Friday, No. 226 November 23, 2018 Part III Department of Justice ----------------------------------------------------------------------- Antitrust Division ----------------------------------------------------------------------- United States v. GS Caltex Corp. et al.; Proposed Final Judgments and Competitive Impact Statement; Notice Federal Register / Vol. 83 , No. 226 / Friday, November 23, 2018 / Notices [[Page 60306]] ----------------------------------------------------------------------- DEPARTMENT OF JUSTICE Antitrust Division United States v. GS Caltex Corp. et al.; Proposed Final Judgments and Competitive Impact Statement Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. Sec. 16(b)-(h), that proposed Final Judgments, Stipulations, and a Competitive Impact Statement have been filed with the United States District Court for the Southern District of Ohio in United States v. GS Caltex et al., Case No. 2:18-cv-01456- ALM-CMV. On November 14, 2018, the United States filed a Complaint alleging that between 2005 and 2016, GS Caltex Corporation (``GS Caltex''), Hanjin Transportation Co., Ltd. (``Hanjin''), and SK Energy Co., Ltd. (``SK Energy''), along with unnamed 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. Sec. 1. A proposed Final Judgment for each Defendant, filed at the same time as the Complaint, requires GS Caltex, Hanjin, and SK Energy to pay the United States, respectively, $57,500,000, $6,182,000, and $90,384,872. In addition, each Defendant has agreed to cooperate with further civil investigative and judicial proceedings and to institute an antitrust compliance program. Copies of the Complaint, proposed Final Judgments, 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 Kathleen S. O'Neill, Chief, Transportation, Energy & Agriculture Section, Antitrust Division, Department of Justice, 450 5th Street NW, Suite 8000, Washington, DC 20530. Patricia A. Brink, Director of Civil Enforcement. United States District Court for the Southern District of Ohio Eastern Division United States Of America, Plaintiff, v. GS Caltex Corporation, GS Tower, 508, Nonhyeon-ro, Gangnam-gu, Seoul, South Korea Hanjin Transportation Co., Ltd., 20th Floor Hanjin New Bldg. 63, Namdaemun-ro, Jung-gu, Seoul, South Korea and SK Energy Co., Ltd., SK Bldg., 26, Jong-ro, Jongno-gu, Seoul, South Korea, Defendants. Case No. 2:18-cv-01456-ALM-CMV Complaint: Violation of Section 1 of the Sherman Act, 15 U.S.C. Sec. 1 Judge: Algenon L. Marbley COMPLAINT The United States of America, acting under the direction of the Acting Attorney General of the United States, brings this civil antitrust action to obtain equitable monetary relief and recover damages from GS Caltex Corporation, Hanjin Transportation Co., Ltd., and SK Energy Co., Ltd., for conspiring to rig bids and fix prices, in violation of Section 1 of the Sherman Act, 15 U.S.C. Sec. 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 other large South Korean oil refiners and logistics companies, and pre-determined which conspirator would win each contract. Defendants and their co- conspirators then fraudulently submitted collusive bids to the U.S. military. Through this scheme, Defendants reaped vastly higher profit margins on the fuel they supplied to the U.S. military than on the fuel they sold to the South Korean military and to private parties. 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. Sec. 1. Defendants have agreed to plead guilty to an information charging a criminal violation of Section 1 of the Sherman Act for this unlawful conduct, and in this civil action, the United States seeks compensation for the injuries it incurred as a result of this conspiracy. II. DEFENDANTS 4. GS Caltex Corporation (``GS Caltex'') is an oil company headquartered in Seoul, South Korea. GS Caltex is a joint venture between GS Energy, a South Korean corporation, and Chevron Corp., a Delaware corporation; each owns a 50 percent interest in GS Caltex. GS Caltex refines and supplies gasoline, diesel, kerosene, and other petroleum products for sale internationally. During the conspiracy, GS Caltex supplied fuel to U.S. military installations in South Korea. 5. Hanjin Transportation Co., Ltd. (``Hanjin'') is a global transportation and logistics company based in Seoul, South Korea. Hanjin is a member of Hanjin Group, a South Korean conglomerate with U.S. subsidiaries, including Hanjin International America. Beginning in 2009, Hanjin partnered with oil companies, including a co-conspirator oil company (``Company A''), to supply fuel to U.S. military installations in South Korea. 6. SK Energy Co., Ltd. (``SK Energy'') is an oil company headquartered in Seoul, South Korea. SK Energy is a wholly-owned subsidiary of SK Innovation Co., Ltd., a South Korean company with U.S. subsidiaries, including SK Energy Americas Inc. SK Energy refines and supplies gasoline, diesel, kerosene, and other petroleum products for sale internationally. During the conspiracy, SK Energy supplied fuel to U.S. military installations in South Korea. 7. 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, a logistics firm (``Company B'') and an oil company (``Company C'') that jointly supplied fuel to the U.S. military. 8. Whenever this Complaint refers to any act, deed, or transaction of any [[Page 60307]] 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. III. JURISDICTION AND VENUE 9. The United States brings this action under Section 4 of the Sherman Act, 15 U.S.C. Sec. 4, and Section 4A of the Clayton Act, 15 U.S.C. Sec. 15a, seeking equitable relief, including equitable monetary remedies, and damages from Defendants' violation of Section 1 of the Sherman Act, 15 U.S.C. Sec. 1. 10. This Court has subject matter jurisdiction over this action under 15 U.S.C. Sec. Sec. 4 and 15a and 28 U.S.C. Sec. Sec. 1331 and 1337. 11. Defendants have consented to venue and personal jurisdiction in this district for the purpose of this Complaint. 12. Defendants 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 contracts, Defendants 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 registered in databases located in the United States. For certain contracts, Defendants submitted bids to U.S. Department of Defense offices in the United States. After being awarded these contracts, Defendants 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. 13. Through its 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 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 14. 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. 15. 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. 16. 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. 17. 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 18. 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, e-mails, 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 19. GS Caltex, SK Energy, and Companies B and C 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. 20. Between early 2005 and mid-2006, GS Caltex, SK Energy, and other conspirators met multiple times and exchanged phone calls and e- mails 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. 21. As part of their discussions related to the 2006 PC&S contracts, GS Caltex and other conspirators agreed not to compete with SK Energy in bidding for the 2008 AAFES contract. In 2008, GS Caltex and other conspirators honored their agreement: GS Caltex bid significantly above the bid submitted by SK Energy for the AAFES contract, while Companies B and C 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 22. Continuing their conspiracy, Defendants 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 Company A joined the conspiracy for the purpose of bidding on the solicitation for the 2009 PC&S contracts. Hanjin and Company A partnered to bid jointly on the 2009 PC&S contracts, with Company A 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. [[Page 60308]] 23. Between late 2008 and mid-2009, Defendants and other co- conspirators met multiple times and exchanged phone calls and e-mails 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 Company A certain line items that had previously been allocated to the original conspirators. 24. With one exception, DLA awarded the 2009 PC&S contracts in line with the allocations made by the Defendants and other co-conspirators. Companies B and C accidentally won one line item that the conspiracy had allocated to GS Caltex. To remedy this misallocation, Company B and GS Caltex agreed that GS Caltex, rather than Company C, would supply Company B with the fuel procured under this line item. 2013 PC&S Contracts 25. Similar to 2006 and 2009, Defendants 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. 26. Defendants and other co-conspirators communicated via phone calls and e-mails to allocate and set the price for each line item in the solicitation for the 2013 PC&S contracts. Defendants 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. 27. However, Hanjin and Company A 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 Company A 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. 28. As a result of their bidding strategy, Hanjin and Company A jointly won nearly all the line items in the 2013 PC&S contracts. As in 2009, Company A was to provide the fuel for these line items, and Hanjin was to provide transportation and logistics. GS Caltex 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. 29. After the award of the 2013 PC&S contracts, Hanjin, Company A, and GS Caltex reached an understanding that GS Caltex, rather than Company A, 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 Company A 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 30. The United States incorporates by reference the allegations in paragraphs 1 through 29. 31. 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. Sec. 1. 32. 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 the Defendants and their co-conspirators engaged in fair competition. VIII. REQUEST FOR RELIEF 33. 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. Sec. 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: November 14, 2018 Respectfully submitted, FOR PLAINTIFF UNITED STATES OF AMERICA: ----------------------------------------------------------------------- Makan Delrahim, Assistant Attorney General for Antitrust. ----------------------------------------------------------------------- Andrew C. Finch, Principal Deputy Assistant Attorney General. ----------------------------------------------------------------------- Bernard A. Nigro Jr., Deputy Assistant Attorney General. ----------------------------------------------------------------------- Patricia A. Brink, Director of Civil Enforcement. ----------------------------------------------------------------------- Kathleen S. O'Neill, Chief, Transportation, Energy & Agriculture Section. ----------------------------------------------------------------------- Robert A. Lepore, Assistant Chief, Transportation, Energy & Agriculture Section. ----------------------------------------------------------------------- J. Richard Doidge Julie Elmer Jeremy Evans John A. Holler Caroline Anderson Jonathan Silberman Patrick Kuhlmann 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, E-mail: [email protected]. Dated: November 14, 2018 Respectfully submitted, FOR PLAINTIFF UNITED STATES OF AMERICA Benjamin C. Glassman, United States Attorney By: ----------------------------------------------------------------------- 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, E- mail: [email protected]. United States District Court for the Southern District of Ohio Eastern Division United States of America, Plaintiff, v. GS Caltex Corporation, Defendant. Case No. 2:18-cv-01456-ALM-CMV PROPOSED FINAL JUDGMENT AS TO DEFENDANT GS CALTEX CORPORATION WHEREAS Plaintiff, United States of America, filed its Complaint on November 14, 2018, the United States and Defendant GS Caltex Corporation (``GS Caltex''), 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, on such date as may be determined by the Court, GS Caltex will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. GS Caltex Corporation [to be assigned] (S.D.Ohio) (the ``Criminal Action'') that will allege a violation of Section 1 of the Sherman Act, 15 U.S.C. Sec. 1, relating to the same events giving rise to the allegations described in the Complaint; [[Page 60309]] 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 of the subject matter of this action and each of the parties consenting hereto. The Complaint states a claim upon which relief may be granted to the United States against GS Caltex under Section 1 of the Sherman Act, 15 U.S.C. Sec. 1. II. APPLICABILITY This Final Judgment applies to GS Caltex, 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. PAYMENT GS Caltex shall pay to the United States within ten (10) business days of the entry of this Final Judgment the amount of fifty-seven million, five hundred thousand dollars ($57,500,000), less the amount paid (excluding any interest) pursuant to the settlement agreement attached hereto as Attachment 1, to satisfy all civil antitrust claims alleged against GS Caltex by the United States in the Complaint. Payment of the amount ordered hereby shall be made by wire transfer of funds or cashier's check. If the payment is made by wire transfer, GS Caltex 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, D.C. 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. IV. COOPERATION GS Caltex shall cooperate fully with the United States regarding any matter about which GS Caltex has 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 in connection with the Plea Agreement and/or 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 Plea Agreement and the settlement agreement attached hereto as Attachment 1, so as to avoid unnecessary duplication and expense. GS Caltex'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 its 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 GS Caltex and present and former officers, directors, employees, and agents of GS Caltex; (b) Making available in the United States, at no expense to the United States, its 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 its best efforts to make available in the United States, at no expense to the United States, its 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 GS Caltex 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, GS Caltex is not required to: (1) Request of its 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 its 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 GS Caltex 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 GS Caltex that its obligations under this Section have expired. V. ANTITRUST COMPLIANCE PROGRAM A. Within thirty (30) days after entry of this Final Judgment, GS Caltex 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, GS Caltex shall appoint a replacement, and shall identify to the United States the Antitrust Compliance Officer's name, business address, telephone number, and email address. GS Caltex's initial or replacement appointment of an Antitrust Compliance Officer is subject to the approval of the United States, in its sole discretion. B. The Antitrust Compliance Officer shall institute an antitrust compliance program for the company's employees and directors with responsibility for bidding for any contract with the United States. 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 [[Page 60310]] 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 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 GS Caltex'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. GS Caltex agrees 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 GS Caltex waives 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. GS Caltex agrees 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 GS Caltex 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 GS Caltex, whether litigated or resolved prior to litigation, GS Caltex agrees 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 and GS Caltex 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. Sec. 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''), GS Caltex Corporation (GS Caltex), and Relator [REDACTED] (hereafter collectively referred to as ``the Parties''), through their authorized representatives. RECITALS A. GS Caltex is a South Korea-based energy company that produces various petroleum products that it sells to South Korean and international customers, including the United States Department of Defense (DoD). 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. Sec. 3730(b) (the Civil FCA Action). Relator contends that GS Caltex conspired with other South Korean entities to rig bids on DoD 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 and/or contract amendments (``PC&S contracts'') executed in 2006, 2009, 2011, and 2013, and AAFES contracts executed in 2008. C. On such date as may be determined by the Court, GS Caltex will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. GS Caltex Corporation, Criminal Action No. [to be assigned] (S.D. Ohio) (the ``Criminal Action'') that will allege that GS Caltex participated in a combination and conspiracy beginning at least in or around March 2005 and continuing until at least in or around October 2016, to suppress and eliminate competition on certain contracts solicited by the DoD to supply ultra[dash]low sulfur diesel and gasoline to numerous U.S. Army, Navy, Marine, and Air Force installations in Korea, known as PC&S contracts, in violation of the Sherman Antitrust Act, 15 U.S.C. Sec. 1. D. GS Caltex will execute a Stipulation with the Antitrust Division of the United States Department of Justice in which GS Caltex will consent to the entry of a Final Judgment to be filed in United States v. GS Caltex Corporation, 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 [[Page 60311]] against GS Caltex 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. E. The United States contends that it has certain civil claims against GS Caltex arising from a conspiracy with other South Korean entities to rig bids on DoD contracts to supply fuel to U.S. military bases throughout South Korea executed between 2005 and 2013, including DLA PC&S contracts and AAFES contracts, as well as the conduct described in the Plea Agreement in the Criminal Action. The conduct referenced 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. F. With the exception of any admissions that are made by GS Caltex in connection with the Plea Agreement in the Criminal Action, this Settlement Agreement is neither an admission of liability by GS Caltex nor a concession by the United States or Relator that their claims are not well founded. G. Relator claims entitlement under 31 U.S.C. Sec. 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.a. GS Caltex shall pay to the United States $42,621,000 (FCA Settlement Amount), of which $28,414,474 is restitution. Relator's right pursuant to 31 U.S.C. Sec. 3730(d) to reasonable expenses, attorneys' fees and costs will be addressed separately by Relator, Relator's counsel and GS Caltex. 1.b. Interest at an annual rate of three (3) percent shall accrue on the FCA Settlement Amount beginning on the Effective Date of this Agreement and continuing until the date that both of the following events have occurred: (i) the Plea Agreement is accepted by the Court in the Criminal Action; and (ii) the proposed Final Judgment is entered by the Court in the Civil Antitrust Action (Accrued Interest). 1.c. The total FCA payment due from GS Caltex shall be the FCA Settlement Amount plus any Accrued Interest (Total FCA Settlement Amount). GS Caltex shall pay the Total FCA Settlement Amount by electronic funds transfer no later than seven (7) business days after both events identified above in Paragraph 1.b. have occurred (Payment Due Date). The Civil Division of the United States Department of Justice shall provide to counsel for GS Caltex written payment instructions and confirmation of the Total FCA Settlement Amount no later than five (5) business days before the Payment Due Date. If GS Caltex does not pay the Total FCA Settlement Amount on or before the Payment Due Date, interest at an annual rate of nine (9) percent shall accrue on the Total FCA Settlement Amount beginning on the first calendar day after the Payment Due Date and shall continue to accrue until paid. 1.d. If GS Caltex's Plea Agreement in the Criminal Action is not accepted by the Court or the Court does not enter the Final Judgment in the Civil Antitrust Action, this Agreement shall be null and void at the option of either the United States or GS Caltex. If either the United States or GS Caltex exercises this option, which option shall be exercised by notifying all Parties, through counsel, in writing within five (5) business days of the Court's decision, the Parties will not object and this Agreement will be rescinded. If this Agreement is rescinded, GS Caltex will not 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, actions or proceedings arising from the Covered Conduct that are brought by the United States within ninety (90) calendar days of rescission, except to the extent such defenses were available on the day on which Relator's qui tam complaint in the Civil FCA Action was filed. 2. Subject to the exceptions in Paragraph 3 (concerning excluded claims) below, and conditioned upon GS Caltex's full payment of the Total FCA Settlement Amount, the United States releases GS Caltex 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. Sec. Sec. 3729-3733; the Program Fraud Civil Remedies Act, 31 U.S.C. Sec. Sec. 3801-3812; Contract Disputes Act, 41 U.S.C. Sec. Sec. 7101-7109; or the common law theories of breach of contract, payment by mistake, unjust enrichment, and fraud, or under any statute creating causes of action for civil damages or civil penalties which the Civil Division of the United States Department of Justice has authority to assert and compromise pursuant to 28 C.F.R. Part O, Subpart I, Sec. 0.45(d). 3. Notwithstanding the release given in paragraph 2 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, except to the extent detailed in the Plea Agreement; 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; 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. 4. 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. Sec. 3730(c)(2)(B). The determination of Relator's share, if any, of the FCA Settlement Amount pursuant to 31 U.S.C. Sec. 3730(d) is a matter that shall be handled separately by and between the Relator and the United States, without any direct involvement or input from GS Caltex. 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. Sec. 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 pursuant to [[Page 60312]] 31 U.S.C. Sec. 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 should receive of any proceeds of the settlement of his claims, and that no agreements concerning Relator share have been reached to date. 5. Relator, for himself, and for his heirs, successors, attorneys, agents, and assigns, releases GS Caltex, together with its predecessors, successors, assigns, shareholders, subsidiaries, businesses, affiliates, divisions, sister companies, owners, directors, officers, agents, employees, and counsel, from any action, in law or in equity, suits, debts, liens, contracts, agreements, covenants, promises, liability, obligations, claims, demands, rights of subrogation, contribution and indemnity, damages, loss, cost or expenses, direct or indirect, of any kind or nature whatsoever (including without limitation 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. Sec. Sec. 3729-3733), known or unknown, fixed or contingent, foreign (including Korean), state or federal, under common law, statute or regulation, liquidated or unliquidated, claimed or concealed, and without regard to the date of occurrence, which Relator ever had, now has, may assert, or may in the future claim to have, against GS Caltex by reason of any act, cause, matter, or thing whatsoever from the beginning of time to the date hereof. Relator represents and warrants that he and his counsel are the exclusive owner of the rights, claims, and causes of action herein released and none of them have previously assigned, reassigned, or transferred or purported to assign, reassign or transfer, through bankruptcy or by any other means, any or any portion of any claim, demand, action, cause of action, or other right released or discharged under this Agreement except between themselves and their counsel. Notwithstanding the foregoing, or any other terms of this Agreement, this Agreement does not resolve or release Relator's right pursuant to 31 U.S.C. Sec. 3730(d) to reasonable expenses necessarily incurred, plus reasonable attorneys' fees and costs relating to the Covered Conduct, the amount of which will be addressed separately by Relator, Relator's counsel, and GS Caltex. 6. GS Caltex waives and shall not assert any defenses GS Caltex 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. GS Caltex fully and finally releases 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 GS Caltex has 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. GS Caltex, for itself and on behalf of its predecessors, successors, assigns, shareholders, subsidiaries, businesses, affiliates, divisions, sister companies, owners, directors, officers, agents, employees, and counsel, releases Relator, together with his heirs, successors, attorneys, agents, and assigns from any action, in law or in equity, suits, debts, liens, contracts, agreements, covenants, promises, liability, obligations, claims, demands, rights of subrogation, contribution and indemnity, damages, loss, cost or expenses, direct or indirect, of any kind or nature whatsoever, known or unknown, fixed or contingent, foreign (including Korean), state or federal, under common law, statute or regulation, liquidated or unliquidated, claimed or concealed, and without regard to the date of occurrence, which GS Caltex ever had, now has, may assert, or may in the future claim to have, against Relator by reason of any act, cause, matter, or thing whatsoever from the beginning of time to the date hereof. GS Caltex represents and warrants that it and its counsel are the exclusive owner of the rights, claims, and causes of action herein released and none of them have previously assigned, reassigned, or transferred or purported to assign, reassign or transfer, through bankruptcy or by any other means, any or any portion of any claim, demand, action, cause of action, or other right released or discharged under this Agreement except between themselves and their counsel. Notwithstanding the foregoing, or any other terms of this Agreement, this Agreement does not resolve or release GS Caltex's right pursuant to 31 U.S.C. Sec. 3730(d) to assert defenses to Relator's claimed attorneys' fees, expenses, and costs relating to the Covered Conduct, the amount of which will be addressed separately by Relator, Relator's counsel, and GS Caltex. 9. a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. Sec. 31.205-47) incurred by or on behalf of GS Caltex, and its present or former officers, directors, employees, shareholders, and agents in connection with: (1) the matters covered by this Agreement, any related plea 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) GS Caltex'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, any related plea agreement, and any related civil antitrust agreement; (5) the payment GS Caltex makes to the United States pursuant to this Agreement and any payments that GS Caltex 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 GS Caltex, and GS Caltex 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, GS Caltex shall identify and repay by adjustment to future claims for payment or otherwise any Unallowable Costs included in payments previously sought by GS Caltex or any of its subsidiaries or affiliates from the United States. GS Caltex agrees that the United States, at a minimum, shall be entitled to recoup from GS Caltex 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 GS Caltex's books and records and to disagree with any calculations submitted by GS Caltex or any of its subsidiaries or affiliates regarding any Unallowable Costs included in payments previously sought [[Page 60313]] by GS Caltex, or the effect of any such Unallowable Costs on the amount of such payments. 10. GS Caltex agrees to cooperate fully and truthfully with the United States in connection with the Civil FCA Action. The Civil Division of the United States Department of Justice will use reasonable best efforts, where appropriate, to coordinate any requests for cooperation in connection with the Civil FCA Action with requests for cooperation in connection with the Plea Agreement in the Criminal Action and the Civil Antitrust Action, so as to avoid unnecessary duplication and expense. GS Caltex'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, D.C. and not at the expense of the United States, complete and un-redacted copies of all non-privileged documents related to the Covered Conduct wherever located in GS Caltex's possession, custody, or control; b. upon request by the United States with reasonable notice, making current GS Caltex 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 Hong Kong 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 GS Caltex 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 GS Caltex 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 Hong Kong unless another place is mutually agreed upon; and d. upon request by the United States with reasonable notice, making current GS Caltex directors, officers, and employees available, and using best efforts to make former GS Caltex 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, Hong Kong, or any other mutually agreed upon place, (ii) at trial in the United States, and (iii) at any other judicial proceedings wherever located related to the Civil FCA Action. 11. This Agreement is intended to be for the benefit of the Parties only. 12. Upon receipt of the payment of the Total FCA Settlement Amount described in Paragraph 1.a-c., above, or receipt of the Total FCA Settlement Amount and any additional interest that accrues if GS Caltex does not pay on or before the Payment Due Date, the United States and Relator shall promptly sign and file a Joint Stipulation of Dismissal, with prejudice, of the claims filed against GS Caltex in the Civil FCA Action, pursuant to Rule 41(a)(1), which dismissal shall be 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. Sec. 3730(d). 13. Except as provided herein, each Party shall bear its own legal and other costs incurred in connection with this matter. The Parties agree that Relator and GS Caltex will not seek to recover from the United States any costs or fees related to the preparation and performance of this Agreement. 14. Each party and signatory to this Agreement represents that it freely and voluntarily enters into this Agreement without any degree of duress or compulsion. 15. 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. GS Caltex agrees that the United States District Court for the Southern District of Ohio has jurisdiction over it for purposes of the Civil FCA Action. 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. 16. 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. 17. The undersigned counsel represent and warrant that they are fully authorized to execute this Agreement on behalf of the persons and entities indicated below. 18. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same Agreement. 19. This Agreement is binding on GS Caltex's successors, transferees, heirs, and assigns. 20. This Agreement is binding on Relator's successors, transferees, heirs, and assigns. 21. 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. 22. This Agreement is effective on the date of signature of the last signatory to the Agreement (Effective Date of this Agreement). Electronic copies 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 GS Caltex Corporation--Defendant Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Authorized Representative of GS Caltex Corporation Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Marguerite M. Sullivan, Latham & Watkins LLP Scott D. Hammond, Gibson, Dunn & Crutcher LLP, Counsel for GS Caltex Corporation [Redacted]--Relator Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- [redacted] Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Eric 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. Hanjin Transportation Co., Ltd. Defendant. Case No. 2:18-cv-01456-ALM-CMV [[Page 60314]] PROPOSED FINAL JUDGMENT AS TO DEFENDANT HANJIN TRANSPORTATION CO., LTD. WHEREAS Plaintiff, United States of America, filed its Complaint on November 14, 2018, the United States and Defendant Hanjin Transportation Co., Ltd. (``Hanjin''), 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, on such date as may be determined by the Court, Hanjin will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. Hanjin Transportation Co., Ltd. [to be assigned] (S.D.Ohio) (the ``Criminal Action'') that will allege a violation of Section 1 of the Sherman Act, 15 U.S. C. Sec. 1, relating to the same events giving rise to the allegations described in the Complaint; 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 of the subject matter of this action and each of the parties consenting hereto. The Complaint states a claim upon which relief may be granted to the United States against Hanjin under Section 1 of the Sherman Act, 15 U.S.C. Sec. 1. II. APPLICABILITY This Final Judgment applies to Hanjin, 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. PAYMENT Hanjin shall pay to the United States within ten (10) business days of the entry of this Final Judgment the amount of six million, one hundred eighty-two thousand ($6,182,000), less the amount paid (excluding any interest) pursuant to the settlement agreement attached hereto as Attachment 1, to satisfy all civil antitrust claims alleged against Hanjin by the United States in the Complaint. Payment of the amount ordered hereby shall be made by wire transfer of funds or cashier's check. If the payment is made by wire transfer, Hanjin 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, D.C. 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. IV. COOPERATION Hanjin shall cooperate fully with the United States regarding any matter about which Hanjin has 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 in connection with the Plea Agreement and/or 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 Plea Agreement and the settlement agreement attached hereto as Attachment 1, so as to avoid unnecessary duplication and expense. Hanjin'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 its 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 Hanjin and present and former officers, directors, employees, and agents of Hanjin; (b) Making available in the United States, at no expense to the United States, its 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 its best efforts to make available in the United States, at no expense to the United States, its 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 Hanjin 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, Hanjin is not required to: (1) request of its 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 its 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 Hanjin 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 Hanjin that its obligations under this Section have expired. V. ANTITRUST COMPLIANCE PROGRAM A. Within thirty (30) days after entry of this Final Judgment, Hanjin shall appoint an Antitrust Compliance Officer and identify to the United States his or her name, business address, telephone number, and email address. Within [[Page 60315]] forty-five (45) days of a vacancy in the Antitrust Compliance Officer position, Hanjin shall appoint a replacement, and shall identify to the United States the Antitrust Compliance Officer's name, business address, telephone number, and email address. Hanjin's initial or replacement appointment of an Antitrust Compliance Officer is subject to the approval of the United States, in its sole discretion. B. The Antitrust Compliance Officer shall institute an antitrust compliance program for the company's employees and directors with responsibility for bidding for any contract with the United States. 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 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 Hanjin'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. Hanjin agrees 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 Hanjin waives 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. Hanjin agrees 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 Hanjin 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 Hanjin, whether litigated or resolved prior to litigation, Hanjin agrees 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 and Hanjin 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. Sec. 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''), Hanjin Transportation Co., Ltd. (Hanjin), and Relator [REDACTED] (hereafter collectively referred to as ``the Parties''), through their authorized representatives. RECITALS A. Hanjin is a South Korea-based logistics company with South Korean and international customers, including the United States Department of Defense (DoD). 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. Sec. 3730(b) (the Civil FCA Action). Relator contends that Hanjin conspired with other South Korean entities to rig bids on DoD contracts to supply fuel to U.S. military bases throughout South Korea beginning in 2008 and continuing until 2016, including DLA Post, Camps, and Stations contracts executed in 2009 and 2013, and AAFES contracts executed in 2008. C. On such date as may be determined by the Court, Hanjin will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. Hanjin Transportation Co., Ltd., Criminal Action No. [to be assigned] (S.D. Ohio) (the ``Criminal Action'') that will allege that Hanjin participated in a combination and conspiracy beginning at least in or around March 2005 and continuing until at least in or around October 2016, to suppress and eliminate [[Page 60316]] competition on certain contracts solicited by the DoD to supply ultra[dash]low sulfur diesel and gasoline to numerous U.S. Army, Navy, Marine, and Air Force installations in Korea, including PC&S contracts, in violation of the Sherman Antitrust Act, 15 U.S.C. Sec. 1. D. Hanjin will execute a Stipulation with the Antitrust Division of the United States Department of Justice in which Hanjin will consent to the entry of a Final Judgment to be filed in United States v. Hanjin Transportation Co., Ltd., 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 Hanjin 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. E. The United States contends that it has certain civil claims against Hanjin arising from a conspiracy with other South Korean entities to rig bids on DoD contracts to supply fuel to U.S. military bases throughout South Korea beginning in 2008 and continuing to 2016, including DLA Post, Camps, and Stations contracts executed in 2009 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. F. With the exception of any admissions that are made by Hanjin in connection with the Plea Agreement in the Criminal Action, this Settlement Agreement is neither an admission of liability by Hanjin nor a concession by the United States or Relator that their claims are not well founded. G. Relator claims entitlement under 31 U.S.C. Sec. 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. Hanjin agrees to pay to the United States $6,182,000 (FCA Settlement Amount) by electronic funds transfer no later than thirteen (13) 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. Relator claims entitlement under 31 U.S.C. Sec. 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 Hanjin acknowledges (without waiving any applicable arguments or defenses) that Relator retains all rights to seek to recover such expenses, attorneys' fees, and costs from Hanjin pursuant to 31 U.S.C. Sec. 3730(d). 2. Subject to the exceptions in Paragraph 4 (concerning excluded claims) below, and conditioned upon Hanjin's full payment of the FCA Settlement Amount, the United States releases Hanjin 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. Sec. Sec. 3729-3733; the Program Fraud Civil Remedies Act, 31 U.S.C. Sec. Sec. 3801-3812; Contract Disputes Act, 41 U.S.C. Sec. Sec. 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. Sec. 3730(d)), and subject to the exceptions in Paragraph 4 below, and conditioned upon Hanjin'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 Hanjin, 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. Sec. Sec. 3729- 3733; (ii) any claims or allegations Relator has asserted or could have asserted against Hanjin 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 Hanjin 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, except to the extent detailed in the Plea Agreement; 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; 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. Sec. 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. Sec. 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 pursuant to 31 U.S.C. Sec. 3730(e)(4). Moreover, the United States and Relator, on behalf of [[Page 60317]] 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 should receive of any proceeds of the settlement of his claims, and that no agreements concerning Relator share have been reached to date. 6. Hanjin waives and shall not assert any defenses Hanjin 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. Hanjin fully and finally releases 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 Hanjin has 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. Hanjin, 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 Hanjin has asserted or could have asserted, arising from the Covered Conduct, and from 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 it would have standing to bring or which Hanjin may now have or claim to have against Relator and his heirs, successors, assigns, agents, and attorneys. Relator hereby represents that neither he nor his companies, [REDACTED], performed business with Hanjin. 9. a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. Sec. 31.205-47) incurred by or on behalf of Hanjin, and its present or former officers, directors, employees, shareholders, and agents in connection with: (1) the matters covered by this Agreement, any related plea 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) Hanjin'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, any related plea agreement, and any related civil antitrust agreement; (5) the payment Hanjin makes to the United States pursuant to this Agreement and any payments that Hanjin 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 Hanjin, and Hanjin 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, Hanjin shall identify and repay by adjustment to future claims for payment or otherwise any Unallowable Costs included in payments previously sought by Hanjin or any of its subsidiaries or affiliates from the United States. Hanjin agrees that the United States, at a minimum, shall be entitled to recoup from Hanjin 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 Hanjin's books and records and to disagree with any calculations submitted by Hanjin or any of its subsidiaries or affiliates regarding any Unallowable Costs included in payments previously sought by Hanjin, or the effect of any such Unallowable Costs on the amount of such payments. 10. Hanjin agrees to cooperate fully and truthfully with the United States in connection with the Civil FCA Action. Hanjin'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, D.C. and not at the expense of the United States, complete and un-redacted copies of all non-privileged documents related to the Covered Conduct wherever located in Hanjin's possession, custody, or control, including but not limited to, reports, memoranda of interviews, and records concerning any investigation of the Covered Conduct that Hanjin has undertaken, or that has been performed by another on Hanjin's behalf; b. upon request by the United States with reasonable notice, making current Hanjin 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 Hong Kong, 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 Hanjin 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 Hanjin 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 Hong Kong, unless another place is mutually agreed upon; and d. upon request by the United States with reasonable notice, making current Hanjin directors, officers, and employees available, and using best efforts to make former Hanjin 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, Hong Kong, or any other mutually agreed upon place, (ii) at trial in the United States, and (iii) at any other judicial proceedings wherever located related to the Civil FCA Action. 11. This Agreement is intended to be for the benefit of the Parties only. 12. Upon receipt of the 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 [[Page 60318]] Hanjin in the Civil FCA Action, pursuant to Rule 41(a)(1) ), which dismissal shall be 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. Sec. 3730(d). 13. Except with respect to payment (if any) by Hanjin of Relator's attorneys' fees, expenses, and costs pursuant to 31 U.S.C. Sec. 3730(d), each Party shall bear its own legal and other costs incurred in connection with this matter. The Parties agree that Relator and Hanjin will not seek to recover from the United States any costs or fees related to the preparation and performance of this Agreement. 14. 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. 15. 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. Hanjin agrees that the United States District Court for the Southern District of Ohio has jurisdiction over it for purposes of the Civil FCA Action. 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. 16. 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. 17. The undersigned counsel represent and warrant that they are fully authorized to execute this Agreement on behalf of the persons and entities indicated below. 18. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same Agreement. 19. This Agreement is binding on Hanjin's successors, transferees, heirs, and assigns. 20. This Agreement is binding on Relator's successors, transferees, heirs, and assigns. 21. 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. 22. 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 Hanjin Transportation Co., Ltd.--Defendant Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Authorized Representative of Hanjin Transportation Co., Ltd. Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- William H. Stallings Counsel for Hanjin Transportation Co., Ltd. Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Kelly B. Kramer Counsel for Hanjin Transportation Co., Ltd. [Redacted]--Relator Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- [Redacted] Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Eric 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. SK Energy Co., Ltd. Defendant. Case No. 2:18-cv-01456-ALM-CMV PROPOSED FINAL JUDGMENT AS TO DEFENDANT SK ENERGY CO., LTD. WHEREAS Plaintiff, United States of America, filed its Complaint on November 14, 2018, the United States and Defendant SK Energy Co., Ltd. (``SK Energy''), 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, on such date as may be determined by the Court, SK Energy will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. SK Energy Co., Ltd. [to be assigned] (S.D.Ohio) (the ``Criminal Action'') that will allege a violation of Section 1 of the Sherman Act, 15 U.S. C. Sec. 1, relating to the same events giving rise to the allegations described in the Complaint; 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 of the subject matter of this action and each of the parties consenting hereto. The Complaint states a claim upon which relief may be granted to the United States against SK Energy under Section 1 of the Sherman Act, 15 U.S.C. Sec. 1. II. APPLICABILITY This Final Judgment applies to SK Energy, 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. PAYMENT SK Energy shall pay to the United States within ten (10) business days of the entry of this Final Judgment the amount of ninety million, three hundred eighty-four thousand, eight hundred and seventy-two dollars ($90,384,872), less the amount paid (excluding any interest) pursuant to the settlement agreement attached hereto as Attachment 1, to satisfy all civil antitrust claims alleged against SK Energy by the United States in the Complaint. Payment of the amount ordered hereby shall be made by wire transfer of funds or cashier's check. If the payment is made by wire transfer, SK Energy 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, D.C. 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. [[Page 60319]] IV. COOPERATION SK Energy shall cooperate fully with the United States regarding any matter about which SK Energy has 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 in connection with the Plea Agreement and/or 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 Plea Agreement and the settlement agreement attached hereto as Attachment 1, so as to avoid unnecessary duplication and expense. SK Energy'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 its 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 SK Energy and present and former officers, directors, employees, and agents of SK Energy; (b) Making available in the United States, at no expense to the United States, its 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 its best efforts to make available in the United States, at no expense to the United States, its 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 SK Energy 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, SK Energy is not required to: (1) request of its 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 its 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 SK Energy 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 SK Energy that its obligations under this Section have expired. V. ANTITRUST COMPLIANCE PROGRAM A. Within thirty (30) days after entry of this Final Judgment, SK Energy 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, SK Energy shall appoint a replacement, and shall identify to the United States the Antitrust Compliance Officer's name, business address, telephone number, and email address. SK Energy's initial or replacement appointment of an Antitrust Compliance Officer is subject to the approval of the United States, in its sole discretion. B. The Antitrust Compliance Officer shall institute an antitrust compliance program for the company's employees and directors with responsibility for bidding for any contract with the United States. 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 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 SK Energy'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. SK Energy agrees 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 SK Energy waives any argument that a different standard of proof should apply. B. The Final Judgment should be interpreted to give full effect to the [[Page 60320]] procompetitive purposes of the antitrust laws and to restore all competition the United States alleged was harmed by the challenged conduct. SK Energy agrees 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 SK Energy 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 SK Energy, whether litigated or resolved prior to litigation, SK Energy agrees 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 and SK Energy 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. Sec. 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''), SK Energy Co., Ltd. (SK Energy), and Relator [REDACTED] (hereafter collectively referred to as ``the Parties''), through their authorized representatives. RECITALS A. SK Energy is a South Korea-based energy company that produces various petroleum products that it sells to South Korean and international customers, including the United States Department of Defense (DoD). 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. Sec. 3730(b) (the Civil FCA Action). Relator contends that SK Energy conspired with other South Korean entities to rig bids on DoD 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 (PC&S) contracts executed in 2006, 2009, and 2013, and AAFES contracts executed in 2008. C. On such date as may be determined by the Court, SK Energy will plead guilty pursuant to Fed. R. Crim. P. 11(c)(1)(C) (the ``Plea Agreement'') to an Information to be filed in United States v. SK Energy Co., Ltd., Criminal Action No. [to be assigned] (S.D. Ohio) (the ``Criminal Action'') that will allege that SK Energy participated in a combination and conspiracy beginning at least in or around March 2005 and continuing until at least in or around October 2016, to suppress and eliminate competition on certain contracts solicited by the DoD to supply fuel to numerous U.S. Army, Navy, Marine, and Air Force installations in Korea, including PC&S contracts and the 2008 AAFES contract, in violation of the Sherman Antitrust Act, 15 U.S.C. Sec. 1. D. SK Energy will execute a Stipulation with the Antitrust Division of the United States Department of Justice in which SK Energy will consent to the entry of a Final Judgment to be filed in United States v. SK Energy Co., Ltd., 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 SK Energy 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. E. The United States contends that it has certain civil claims against SK Energy arising from the conduct described in the Plea Agreement in the Criminal Action and in the Stipulation in the Civil Antitrust Action, as well as the conduct, actions, and claims alleged by Relator in the Civil FCA Action. The conduct referenced in this Paragraph is referred to below as the Covered Conduct. F. With the exception of any admissions that are made by SK Energy in connection with the Plea Agreement in the Criminal Action, this Settlement Agreement is neither an admission of liability by SK Energy nor a concession by the United States that its claims are not well founded. G. Relator claims entitlement under 31 U.S.C. Sec. 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.a. SK Energy agrees to pay to the United States $71,866,000 (FCA Settlement Amount), of which $47,910,887 is restitution, by electronic funds transfer no later than thirteen (13) business days after the Effective Date of this Agreement pursuant to written instructions to be provided by the Civil Division of the Department of Justice. Relator claims entitlement under 31 U.S.C. Sec. 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 SK Energy acknowledges that Relator retains all rights to recover such expenses, attorneys' fees, and costs from SK Energy pursuant to 31 U.S.C. Sec. 3730(d). 1.b. If SK Energy's Plea Agreement in the Criminal Action is not accepted by [[Page 60321]] the Court or the Court does not enter a Final Judgment in the Civil Antitrust Action, this Agreement shall be null and void at the option of either the United States or SK Energy. If either the United States or SK Energy exercises this option, which option shall be exercised by notifying all Parties, through counsel, in writing within five (5) business days of the Court's decision, the Parties will not object and this Agreement will be rescinded and the FCA Settlement Amount shall be returned to SK Energy. If this Agreement is rescinded, SK Energy will not 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, actions or proceedings arising from the Covered Conduct that are brought by the United States within ninety (90) calendar days of rescission, except to the extent such defenses were available on the day on which Relator's qui tam complaint in the Civil FCA Action was filed. 2. Subject to the exceptions in Paragraph 4 (concerning excluded claims) below, and conditioned upon SK Energy's full payment of the FCA Settlement Amount, the United States releases SK Energy 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 (the ``SK Energy Released Parties'') from any civil or administrative monetary claim the United States has for the Covered Conduct under the False Claims Act, 31 U.S.C. Sec. Sec. 3729-3733; the Program Fraud Civil Remedies Act, 31 U.S.C. Sec. Sec. 3801-3812; Contract Disputes Act, 41 U.S.C. Sec. Sec. 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. Sec. 3730(d)), and conditioned upon SK Energy's full payment of the FCA Settlement Amount, Relator, for himself and for his heirs, successors, attorneys, agents, and assigns, releases the SK Energy Released Parties from (a) any civil monetary claim the Relator has or may have for the claims set forth in the Civil FCA Action, the Civil Antitrust Action, the Criminal Action, and the Covered Conduct under the False Claims Act, 31 U.S.C. Sec. Sec. 3729-3733, up until the date of this Agreement; and (b) 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, state, or Korean statute, law, regulation or doctrine, that Relator, his heirs, successors, attorneys, agents, and assigns otherwise has brought or would have standing to bring as of the date of this Agreement, including any liability to Relator arising from or relating to the claims Relator asserted or could have asserted in the Civil FCA Action, up until the date of this Agreement. Relator further represents he does not know of any conduct by the SK Energy Released Parties or any current or former owners, officers, directors, trustees, shareholders, employees, executives, agents, or affiliates of the SK Energy Released Parties that would constitute a violation of the False Claims Act other than the claims set forth in the Civil FCA Action and the Covered Conduct, and Relator acknowledges and agrees that his representations are a material inducement to SK Energy's willingness to enter into this Agreement. 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, except to the extent detailed in the Plea Agreement; 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; 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. Sec. 3730(c)(2)(B). The determination of Relator's share, if any, of the FCA Settlement Amount pursuant to 31 U.S.C. Sec. 3730(d) is a matter that shall be handled separately by and between the Relator and the United States, without any direct involvement or input from SK Energy. 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. Sec. 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 pursuant to 31 U.S.C. Sec. 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 should receive of any proceeds of the settlement of his claims, and that no agreements concerning Relator share have been reached to date. 6. SK Energy waives and shall not assert any defenses SK Energy 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. SK Energy fully and finally releases 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 SK Energy has 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. Conditioned upon Relator's agreement herein, the SK Energy Released Parties fully and finally release Relator his heirs, successors, assigns, agents and attorneys (the ``Relator Released Parties''), from (a) any civil monetary claim SK Energy has or may have now or in the future against the Relator Released Parties related to the claims set forth in the Civil FCA Action, the Civil Antitrust Action, the Criminal Action, and the Covered Conduct under the False Claims Act, 31 U.S.C. Sec. Sec. 3729-3733, and the Relator's investigation and prosecution thereof, including [[Page 60322]] attorney's fees, costs, and expenses of every kind and however denominated, up until the date of this Agreement; and (b) 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, state, or Korean statute, law, regulation or doctrine, that the SK Energy Released Parties otherwise have brought or would have standing to bring as of the date of this Agreement, including any liability to SK Energy arising from or relating to claims the SK Energy Released Parties asserted or could have asserted related to the Civil FCA Action, up until the date of this Agreement. The SK Energy Released Parties further acknowledge and agree that these representations are a material inducement to Relator's willingness to enter into this Agreement. 9.a. Unallowable Costs Defined: All costs (as defined in the Federal Acquisition Regulation, 48 C.F.R. Sec. 31.205-47) incurred by or on behalf of SK Energy, and its present or former officers, directors, employees, shareholders, and agents in connection with: (1) the matters covered by this Agreement, any related plea 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) SK Energy'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, any related plea agreement, and any related civil antitrust agreement; (5) the payment SK Energy makes to the United States pursuant to this Agreement and any payments that SK Energy 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 SK Energy, and SK Energy 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, SK Energy shall identify and repay by adjustment to future claims for payment or otherwise any Unallowable Costs included in payments previously sought by SK Energy or any of its subsidiaries or affiliates from the United States. SK Energy agrees that the United States, at a minimum, shall be entitled to recoup from SK Energy 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 SK Energy's books and records and to disagree with any calculations submitted by SK Energy or any of its subsidiaries or affiliates regarding any Unallowable Costs included in payments previously sought by SK Energy, or the effect of any such Unallowable Costs on the amount of such payments. 10. SK Energy agrees to cooperate fully and truthfully with the United States in connection with the Civil FCA Action. The Civil Division of the United States Department of Justice will use reasonable best efforts, where appropriate, to coordinate any requests for cooperation in connection with the Civil FCA Action with requests for cooperation in connection with the Plea Agreement in the Criminal Action and the Civil Antitrust Action, so as to avoid unnecessary duplication and expense. SK Energy'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, D.C. and not at the expense of the United States, complete and un-redacted copies of all non-privileged documents related to the Covered Conduct wherever located in SK Energy's possession, custody, or control, including but not limited to, reports, memoranda of interviews, and records concerning any investigation of the Covered Conduct that SK Energy has undertaken, or that has been performed by another on SK Energy's behalf; b. upon request by the United States with reasonable notice, making current SK Energy 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 Hong Kong, 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 SK Energy 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 SK Energy 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 Hong Kong, unless another place is mutually agreed upon; and d. upon request by the United States with reasonable notice, making current SK Energy directors, officers, and employees available, and using best efforts to make former SK Energy 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, Hong Kong, or any other mutually agreed upon place, (ii) at trial in the United States, and (iii) at any other judicial proceedings wherever located related to the Civil FCA Action. 11. This Agreement is intended to be for the benefit of the Parties only. 12. Upon receipt of the payment of the FCA Settlement Amount described in Paragraph 1 above, the Court's acceptance of SK Energy's Plea Agreement in the Criminal Action, and the Court's entry of a Final Judgment in the Civil Antitrust Action, the United States and Relator shall promptly sign and file a Joint Stipulation of Dismissal, with prejudice, of the claims filed against SK Energy in the Civil FCA Action, pursuant to Rule 41(a)(1), which dismissal shall be 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. Sec. 3730(d). 13. Except with respect to the recovery of Relator's attorneys' fees, expenses, and costs pursuant to 31 U.S.C. Sec. 3730(d), each Party shall bear its own legal and other costs incurred in connection with this matter. The Parties agree that Relator and SK Energy will not seek to recover from the United States any costs or fees related to the preparation and performance of this Agreement. 14. 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. 15. This Agreement is governed by the laws of the United States. The exclusive [[Page 60323]] jurisdiction and venue for any dispute relating to this Agreement is the United States District Court for the Southern District of Ohio. SK Energy agrees that the United States District Court for the Southern District of Ohio has jurisdiction over it for purposes of this case. 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. 16. This Agreement constitutes the complete agreement between the Parties on the subject matter addressed herein. This Agreement may not be amended except by written consent of the Parties. 17. The undersigned counsel represent and warrant that they are fully authorized to execute this Agreement on behalf of the persons and entities indicated below. 18. This Agreement may be executed in counterparts, each of which constitutes an original and all of which constitute one and the same Agreement. 19. This Agreement is binding on SK Energy's successors, transferees, heirs, and assigns. 20. This Agreement is binding on Relator's successors, transferees, heirs, and assigns. 21. 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. 22. 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 SK Energy Co., Ltd.--Defendant Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Myunghun Lee, Authorized Representative of SK Energy, Co., Ltd. Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Phillip H. Warren, Counsel for SK Energy Co., Ltd. [Redacted]--Relator Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- [Redacted] Dated:----------------------------------------------------------------- By:-------------------------------------------------------------------- Eric Havian, Counsel for Relator UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO EASTERN DIVISION United States of America, Plaintiff, v. GS Caltex Corporation, Hanjin Transportation Co., Ltd., and SK Energy Co., Ltd. Defendants. Case No. 2:18-cv-01456-ALM-CMV COMPETITIVE IMPACT STATEMENT Plaintiff United States of America, pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act (``APPA'' or ``Tunney Act''), 15 U.S.C. Sec. 16(b)-(h), files this Competitive Impact Statement relating to the proposed Final Judgments submitted for entry in this civil antitrust proceeding. I. NATURE AND PURPOSE OF THE PROCEEDING On November 14, 2018, the United States filed a civil antitrust complaint against Defendants GS Caltex Corporation (``GS Caltex''), Hanjin Transportation Co., Ltd. (``Hanjin''), and SK Energy Co., Ltd. (``SK Energy'') alleging that Defendants violated Section 1 of the Sherman Act, 15 U.S.C. Sec. 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. Defendants have agreed to plead guilty to an information charging a criminal violation of Section 1 of the Sherman Act for this unlawful conduct; in this parallel civil action, the United States seeks compensation for the injury it incurred as a result of the conspiracy. At the same time the Complaint was filed, the United States also filed agreed-upon proposed Final Judgments that would remedy the violation by having GS Caltex, Hanjin, and SK Energy pay $57,500,000, $6,182,000, and $90,384,872, respectively, to the United States. These payments resolve all civil claims of the United States related to the conduct described in the Complaint. The United States and Defendants have stipulated that the proposed Final Judgments may be entered after compliance with the APPA. Entry of the proposed Final Judgments would terminate this action, except that the Court would retain jurisdiction to construe, modify, or enforce the provisions of the proposed Final Judgments and to punish violations thereof. II. DESCRIPTION OF THE EVENTS GIVING RISE TO THE ALLEGED VIOLATION A. Defendants GS Caltex is an oil company headquartered in Seoul, South Korea. GS Caltex is a joint venture between GS Energy, a South Korean corporation, and Chevron Corp., a Delaware corporation, which each own a 50 percent interest in GS Caltex. GS Caltex is engaged in the refining and supply of gasoline, diesel, kerosene, and other petroleum products for sale internationally. During the time of the conspiracy, GS Caltex supplied fuel to U.S. military installations in South Korea. Hanjin is a global transportation and logistics company based in Seoul, South Korea. Hanjin is a member of Hanjin Group, a South Korean conglomerate with U.S. subsidiaries, including Hanjin International America. Beginning in 2009, Hanjin partnered with oil companies, including a co-conspirator oil company (``Company A''), to supply fuel to U.S. military installations in South Korea. SK Energy is an oil company headquartered in Seoul, South Korea. SK Energy is engaged in the refining and supply of gasoline, diesel, kerosene, and other petroleum products for sale internationally. During the time of the conspiracy, SK Energy supplied fuel to U.S. military installations in South Korea. 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, a logistics firm (``Company B'') and an oil company (``Company C'') that jointly supplied fuel to the U.S. military. 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. [[Page 60324]] 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, e-mails, 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, and Companies B and C 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, and other conspirators met multiple times and exchanged phone calls and e-mails 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. Second, the Complaint alleges that, as part of their discussions related to the 2006 PC&S contracts, GS Caltex and other conspirators 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 Defendants 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 Company A 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, Defendants and other co-conspirators met multiple times and exchanged phone calls and e-mails 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 Company A certain line items that had previously been allocated to the original conspirators. Finally, the Complaint alleges that Defendants 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 Defendants and other co-conspirators communicated via phone calls and e-mails to allocate and set the price for each line item in the solicitation for the 2013 PC&S contracts. Defendants 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 Company A 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 Company A 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 JUDGMENTS For violations of Section 1 of the Sherman Act, the United States may seek damages, 15 U.S.C. Sec. 15a, and equitable relief, 15 U.S.C. Sec. 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 also related to a qui tam action currently filed under seal in the United States District Court for the Southern District of Ohio, alleging a violation of the False Claims Act, 31 U.S.C. Sec. 3730, based on the same facts alleged in the Complaint. A. Payment and Cooperation The proposed Final Judgments require GS Caltex, Hanjin, and SK Energy respectively to pay $57,500,000, $6,182,000, and $90,384,872 to the United States within 10 business days of 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 the 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 separate agreements reached between the 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 to each of the proposed Final Judgments. 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 [[Page 60325]] Judgments fully compensate the United States for losses it suffered and deprive Defendants of the illegitimate profits they gained as a result of the collusive bidding. In addition to the payment of damages, the proposed Final Judgments also require the Defendants to cooperate with the United States regarding any ongoing civil investigation, trial, or other proceeding related to the conduct described in the Complaint. To assist with these proceedings, Defendants are required to provide all non-privileged information in their possession, make available their present employees, and use best efforts to make available their former employees, for interviews or testimony, as requested by the United States. This cooperation will help the United States pursue compensation from co-conspirators not named in this action. 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. Under the proposed Final Judgments, each Defendant will pay an amount that exceeds the overcharge but that reflects the value of the cooperation commitments the Defendants have made as a condition of settlement and the cost savings realized by avoiding extended litigation. The proposed Final Judgments also require each Defendant to appoint an Antitrust Compliance Officer and to institute an antitrust compliance program. Under the antitrust compliance program, employees and directors of Defendants with responsibility for bidding on contracts with the United States 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 that Defendant is in compliance with this requirement. B. Enforcement of Final Judgments The proposed Final Judgments contain provisions designed to promote compliance and make the enforcement of Division consent decrees 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 Judgments, 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 Judgments, the United States may establish the violation and the appropriateness of any remedy by a preponderance of the evidence and that the 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 Judgments. The proposed Final Judgments were drafted to restore all competition the United States alleged was harmed by the Defendants' challenged conduct. The Defendants agree that they will abide by the proposed Final Judgments, and that they may be held in contempt of this Court for failing to comply with any provision of the proposed Final Judgments that is stated specifically and in reasonable detail, as interpreted in light of this procompetitive purpose. Paragraph VII(C) further provides that should the Court find 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, in order to compensate American taxpayers for any costs associated with the investigation and enforcement of violations of a proposed Final Judgment, Paragraph VII(C) provides that in any successful effort by the United States to enforce a Final Judgment against a Defendant, whether litigated or resolved before litigation, Defendants agree to reimburse the United States for any attorneys' fees, experts' fees, or costs incurred in connection with any enforcement effort, including the investigation of the potential violation. Finally, Section VIII of the proposed Final Judgments provide that each Final Judgment shall expire seven years from the date of its entry, except that after five years from the date of its entry, a Final Judgment may be terminated upon notice by the United States to the Court and the Defendant that the continuation of that Final Judgment is no longer necessary or in the public interest. IV. REMEDIES AVAILABLE TO POTENTIAL PRIVATE LITIGANTS Entry of the proposed Final Judgments 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. Sec. 16(a), the proposed Final Judgments have no prima facie effect in any subsequent lawsuit that may be brought against Defendants. V. PROCEDURES AVAILABLE FOR MODIFICATION OF THE PROPOSED FINAL JUDGMENTS The United States and Defendants have stipulated that the proposed Final Judgments 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 Judgments are in the public interest. The APPA provides a period of at least sixty (60) days preceding the effective date of the proposed Final Judgments within which any person may submit to the United States written comments regarding a 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 United States, which remains free to withdraw its consent to a proposed Final Judgment at any time prior to the Court's entry of judgment. The comments and the response of the United States will be filed with the Court. In addition, comments will be posted on the Antitrust Division's internet website and, in certain circumstances, published in the Federal Register. Written comments should be submitted by mail to: Kathleen S. O'Neill, Chief, Transportation, Energy & Agriculture Section, Antitrust Division, United States Department of Justice, 450 5th Street NW, Suite 8000, Washington, DC 20530 The proposed Final Judgments provide that the Court retains jurisdiction over this action, and the parties may apply to the Court for any necessary or appropriate modification, interpretation, or enforcement of a Final Judgment. VI. ALTERNATIVES TO THE PROPOSED FINAL JUDGMENTS The United States considered, as an alternative to the proposed Final Judgments, a full trial on the merits against Defendants. The United States is satisfied, however, that the relief in the proposed Final Judgments remedies the violation of the Sherman Act alleged in the Complaint. The proposed Final [[Page 60326]] Judgments represent substantial monetary relief while avoiding the time, expense, and uncertainty of a full trial on the merits. Further, Defendants' agreements to cooperate with the civil investigation and any potential litigation will enhance the ability of the United States to obtain relief from the remaining conspirators. VII. STANDARD OF REVIEW UNDER THE APPA FOR THE PROPOSED FINAL JUDGMENTS 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. Sec. 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. Sec. 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 defendant within the reaches of the public interest.'' United States v. Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public interest standard under the Tunney Act); United States v. Hillsdale Cmty. Health Ctr., 2015 U.S. Dist. LEXIS 162505, at *3 (E.D. Mich. 2015) (explaining that the ``Court's review 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 the 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''). 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 decree is sufficiently clear, whether its enforcement mechanisms are sufficient, and whether the decree may positively harm third parties. See Microsoft, 56 F.3d at 1458-62; United States v. Medical Mut. of Ohio, 1998 U.S. Dist. LEXIS 21508, at *2-3 (N.D. Ohio 1998). With respect to the adequacy of the relief secured by the decree, a court may not ``engage in an unrestricted evaluation of what relief would best serve the public.'' United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (quoting United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see also Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F. Supp. 2d 37, 40 (D.D.C. 2001); 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. The court's role in protecting the public interest is one of insuring that the government has not breached its duty to the public in consenting to the decree. The court is required to determine not whether a particular decree is the one that will best serve society, but whether the settlement is ``within the reaches of the public interest.'' More elaborate requirements might undermine the effectiveness of antitrust enforcement by consent decree. Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).\1\ --------------------------------------------------------------------------- \1\ See also BNS, 858 F.2d at 464 (holding that the court's ``ultimate authority under the [APPA] is limited to approving or disapproving the consent decree''); United States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the court is constrained to ``look at the overall picture not hypercritically, nor with a microscope, but with an artist's reducing glass''). --------------------------------------------------------------------------- In determining whether a proposed settlement is in the public interest, a district court ``must accord deference to the government's predictions about the efficacy of its remedies, and may not require that the remedies perfectly match the alleged violations.'' SBC Commc'ns, 489 F. Supp. 2d at 17; see also United States v. U.S. Airways Group, Inc., 38 F. Supp. 3d 69, 74 (D.D.C. 2014) (noting that a court should not reject the proposed remedies because it believes others are preferable and that room must be made for the government to grant concessions in the negotiation process for settlements); United States v. Dairy Farmers of Am., Inc., 2007 U.S. Dist. LEXIS 33230, at *3 (E.D. Ky. 2007) (citing United States v. Microsoft, 231 F. Supp. 2d 144, 152 (D.D.C. 2002)) (noting that a court ``must accord deference to the government's predictions as to the effect of the proposed remedies''); United States v. Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (noting that the court should grant ``due respect to the government's prediction as to the effect of proposed remedies, its perception of the market structure, and its views of the nature of the case''). The ultimate question is whether ``the remedies [obtained in the decree 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 United States v. Western Elec. Co., 900 F.2d 283, 309 (D.C. Cir. 1990)). To meet this standard, the United States ``need only provide a factual basis for concluding that the settlements are reasonably adequate remedies for the alleged harms.'' SBC Commc'ns, 489 F. Supp. 2d at 17. 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; see also Dairy Farmers, 2007 U.S. Dist. LEXIS 33230 at *3 (citing Microsoft favorably). As the United States District Court for the District of Columbia confirmed in [[Page 60327]] SBC Communications, courts ``cannot look beyond the complaint in making the public interest determination unless the complaint is drafted so narrowly as to make a mockery of judicial power.'' SBC Commc'ns, 489 F. Supp. 2d at 15. In its 2004 amendments,\2\ Congress made clear its intent to preserve the practical benefits of utilizing consent decrees in antitrust enforcement, adding 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. Sec. 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). Rather, the procedure for the public interest determination is left to the discretion of the court, with the recognition that the court's ``scope of review remains sharply proscribed by precedent and the nature of Tunney Act proceedings.'' SBC Commc'ns, 489 F. Supp. 2d at 11. 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. See also United States v. Enova Corp., 107 F. Supp. 2d 10, 17 (D.D.C. 2000) (noting that the ``Tunney Act expressly allows the court to make its public interest determination on the basis of the competitive impact statement and response to comments alone''); S. Rep. No. 93-298 93d Cong., 1st Sess., at 6 (1973) (``Where the public interest can be meaningfully evaluated simply on the basis of briefs and oral arguments, that is the approach that should be utilized.''). --------------------------------------------------------------------------- \2\ The 2004 amendments substituted ``shall'' for ``may'' in directing relevant factors for a court to consider and amended the list of factors to focus on competitive considerations and to address potentially ambiguous judgment terms. Compare 15 U.S.C. Sec. 16(e) (2004), with 15 U.S.C. Sec. 16(e)(1) (2006); see also SBC Commc'ns, 489 F. Supp. 2d at 11 (concluding that the 2004 amendments ``effected minimal changes'' to Tunney Act review). --------------------------------------------------------------------------- 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: November 14, 2018 Respectfully submitted, Benjamin C. Glassman, United States Attorney ----------------------------------------------------------------------- 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, E- mail: [email protected] ----------------------------------------------------------------------- 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, E-mail: [email protected] [FR Doc. 2018-25461 Filed 11-21-18; 8:45 am] BILLING CODE 4410-11-P
![60308 Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices
23. Between late 2008 and mid-2009, 2013 PC&S contracts through October Deputy Assistant Attorney General.
Defendants and other co-conspirators 2016. lllllllllllllllllllll
met multiple times and exchanged 29. After the award of the 2013 PC&S Patricia A. Brink,
phone calls and e-mails to allocate the contracts, Hanjin, Company A, and GS Director of Civil Enforcement.
line items in the solicitation for the Caltex reached an understanding that lllllllllllllllllllll
2009 PC&S contracts. As in 2006, these GS Caltex, rather than Company A, Kathleen S. O’Neill,
conspirators agreed to bid high so as to would supply Hanjin with fuel for Chief, Transportation, Energy & Agriculture
not win line items allocated to other co- certain line items. Under this side Section.
conspirators. The original conspirators agreement, Hanjin paid a much lower lllllllllllllllllllll
agreed to allocate to Hanjin and price to GS Caltex for fuel than the price Robert A. Lepore,
Company A certain line items that had it previously had agreed to pay Assistant Chief, Transportation, Energy &
previously been allocated to the original Company A to acquire fuel for those line Agriculture Section.
conspirators. items. However, the price that Hanjin lllllllllllllllllllll
24. With one exception, DLA awarded paid to GS Caltex exceeded a J. Richard Doidge
the 2009 PC&S contracts in line with the competitive price for fuel. Julie Elmer
allocations made by the Defendants and Jeremy Evans
VI. VIOLATIONS ALLEGED John A. Holler
other co-conspirators. Companies B and Caroline Anderson
C accidentally won one line item that 30. The United States incorporates by
Jonathan Silberman
the conspiracy had allocated to GS reference the allegations in paragraphs 1 Patrick Kuhlmann
Caltex. To remedy this misallocation, through 29. Attorneys for the United States
Company B and GS Caltex agreed that 31. The conduct of Defendants and U.S. Department of Justice, Antitrust
GS Caltex, rather than Company C, their co-conspirators unreasonably Division, 450 5th Street NW, Suite 8000,
would supply Company B with the fuel restrained trade and harmed Washington, DC 20530, Tel.: (202) 514–8944,
procured under this line item. competition for the supply of fuel to the Fax: (202) 616–2441, E-mail: Dick.Doidge@
U.S. military in South Korea in violation usdoj.gov.
2013 PC&S Contracts of Section 1 of the Sherman Act, 15 Dated: November 14, 2018
25. Similar to 2006 and 2009, U.S.C. § 1. Respectfully submitted,
Defendants and other co-conspirators 32. The United States was injured as FOR PLAINTIFF UNITED STATES OF
conspired to rig bids and fix prices for a result of the unlawful conduct because AMERICA
the 2013 PC&S contracts, which were it paid more for the supply of fuel than Benjamin C. Glassman,
issued in response to solicitation it would have had the Defendants and United States Attorney
SP0600–12–R–0332. The term of the their co-conspirators engaged in fair By:
2013 PC&S Contract covered the supply competition. lllllllllllllllllllll
of fuel from August 2013 through July VIII. REQUEST FOR RELIEF Andrew M. Malek (Ohio Bar #0061442)
2016. Assistant United States Attorney, 303
26. Defendants and other co- 33. The United States requests that Marconi Boulevard, Suite 200, Columbus,
conspirators communicated via phone this Court: Ohio 43215, Tel: (614) 469–5715, Fax: (614)
calls and e-mails to allocate and set the (a) adjudge that Defendants’ and their 469–2769, E-mail: Andrew.Malek@usdoj.gov.
price for each line item in the co-conspirators’ conduct constitutes an United States District Court for the
solicitation for the 2013 PC&S contracts. unreasonable restraint of interstate Southern District of Ohio Eastern
Defendants and other co-conspirators commerce, import trade or commerce, Division
believed that they had an agreement as and commerce with foreign nations in
violation of Section 1 of the Sherman United States of America, Plaintiff, v. GS
to their bidding strategy and pricing for Caltex Corporation, Defendant.
the 2013 PC&S contracts. As a result of Act, 15 U.S.C. § 1;
(b) award the United States damages Case No. 2:18–cv–01456–ALM–CMV
this agreement, they bid higher prices
than they would have in a competitive to which it is entitled for the losses PROPOSED FINAL JUDGMENT AS TO
process. incurred as the result of Defendants’ and DEFENDANT GS CALTEX
their co-conspirators’ conduct; CORPORATION
27. However, Hanjin and Company A
(c) award the United States equitable
submitted bids for the 2013 PC&S WHEREAS Plaintiff, United States of
disgorgement of the ill-gotten gains
contracts below the prices set by the America, filed its Complaint on
obtained by Defendants;
other co-conspirators. Although lower November 14, 2018, the United States
(d) award the United States its costs
than the pricing agreed upon by the and Defendant GS Caltex Corporation
of this action; and
conspirators, Hanjin and Company A (‘‘GS Caltex’’), by their respective
(e) award the United States other
still submitted bids above a competitive, attorneys, have consented to the entry of
relief that the Court deems just and
non-collusive price, knowing that they this Final Judgment without trial or
proper.
would likely win the contracts because adjudication of any issue of fact or law;
Dated: November 14, 2018
the other conspirators would bid even WHEREAS, on such date as may be
higher prices. Respectfully submitted, determined by the Court, GS Caltex will
28. As a result of their bidding FOR PLAINTIFF UNITED STATES OF plead guilty pursuant to Fed. R. Crim.
strategy, Hanjin and Company A jointly AMERICA: P. 11(c)(1)(C) (the ‘‘Plea Agreement’’) to
won nearly all the line items in the 2013 lllllllllllllllllllll an Information to be filed in United
amozie on DSK3GDR082PROD with NOTICES2
PC&S contracts. As in 2009, Company A Makan Delrahim, States v. GS Caltex Corporation [to be
was to provide the fuel for these line Assistant Attorney General for Antitrust. assigned] (S.D.Ohio) (the ‘‘Criminal
items, and Hanjin was to provide lllllllllllllllllllll Action’’) that will allege a violation of
transportation and logistics. GS Caltex Andrew C. Finch, Section 1 of the Sherman Act, 15
and other co-conspirators won a few, Principal Deputy Assistant Attorney General. U.S.C. § 1, relating to the same events
small line items; SK Energy won none. lllllllllllllllllllll giving rise to the allegations described
DLA made inflated payments under the Bernard A. Nigro Jr., in the Complaint;
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![60310 Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices
relevant experience in the field of procompetitive principles and applying States Department of Justice and the
United States antitrust law. ordinary tools of interpretation, is stated United States Attorney’s Office for the
C. Each Antitrust Compliance Officer specifically and in reasonable detail, Southern District of Ohio, on behalf of
shall obtain, within six months after whether or not it is clear and the Defense Logistics Agency (DLA) and
entry of this Final Judgment, and on an unambiguous on its face. In any such the Army and Air Force Exchange
annual basis thereafter, on or before interpretation, the terms of this Final Service (AAFES) (collectively the
each anniversary of the entry of this Judgment should not be construed ‘‘United States’’), GS Caltex Corporation
Final Judgment, from each person against either party as the drafter. (GS Caltex), and Relator [REDACTED]
subject to Paragraph V.B of this Final C. In any enforcement proceeding in (hereafter collectively referred to as ‘‘the
Judgment, and thereafter maintaining, a which the Court finds that GS Caltex Parties’’), through their authorized
certification that each such person has has violated this Final Judgment, the representatives.
received the required two hours of United States may apply to the Court for RECITALS
annual antitrust training. a one-time extension of this Final
D. Each Antitrust Compliance Officer Judgment, together with such other A. GS Caltex is a South Korea-based
shall communicate annually to all relief as may be appropriate. In energy company that produces various
employees that they may disclose to the connection with any successful effort by petroleum products that it sells to South
Antitrust Compliance Officer, without the United States to enforce this Final Korean and international customers,
reprisal, information concerning any Judgment against GS Caltex, whether including the United States Department
potential violation of the United States litigated or resolved prior to litigation,of Defense (DoD).
antitrust laws. GS Caltex agrees to reimburse the B. On February 28, 2018, Relator, a
E. Each Antitrust Compliance Offer United States for the fees and expenses resident and citizen of South Korea,
shall provide to the United States of its attorneys, as well as any other filed a qui tam action in the United
within six months after entry of this costs including experts’ fees, incurred inStates District Court for the Southern
Final Judgment, and on an annual basis connection with that enforcement effort, District of Ohio captioned United States
thereafter, on or before each anniversary including in the investigation of the ex rel. [REDACTED] v. GS Caltex, et al.,
of the entry of this Final Judgment, a Civil Action No. [REDACTED], pursuant
potential violation.
written statement as to the fact and to the qui tam provisions of the False
manner of GS Caltex’s compliance with VIII. EXPIRATION OF FINAL Claims Act, 31 U.S.C. § 3730(b) (the
Section V of this Final Judgment. JUDGMENT Civil FCA Action). Relator contends that
VI. RETENTION OF JURISDICTION Unless this Court grants an extension, GS Caltex conspired with other South
this Final Judgment shall expire seven Korean entities to rig bids on DoD
This Court retains jurisdiction to (7) years from the date of its entry, contracts to supply fuel to U.S. military
enable any of the parties to this Final except that after five (5) years from the bases throughout South Korea beginning
Judgment to apply to this Court at any date of its entry, this Final Judgment in 2005 and continuing until 2016,
time for further orders and directions as may be terminated upon notice by the including DLA Post, Camps, and
may be necessary or appropriate to carry United States to the Court and GS Caltex Stations contracts and/or contract
out or construe this Final Judgment, to that the continuation of the Final amendments (‘‘PC&S contracts’’)
modify or terminate any of its Judgment no longer is necessary or in executed in 2006, 2009, 2011, and 2013,
provisions, to enforce compliance, and and AAFES contracts executed in 2008.
the public interest.
to punish violations of its provisions. C. On such date as may be determined
IX. PUBLIC INTEREST by the Court, GS Caltex will plead guilty
VII. ENFORCEMENT OF FINAL DETERMINATION pursuant to Fed. R. Crim. P. 11(c)(1)(C)
JUDGMENT (the ‘‘Plea Agreement’’) to an
Entry of this Final Judgment is in the
A. The United States retains and public interest. The parties have Information to be filed in United States
reserves all rights to enforce the complied with the requirements of the v. GS Caltex Corporation, Criminal
provisions of this Final Judgment, Antitrust Procedures and Penalties Act, Action No. [to be assigned] (S.D. Ohio)
including the right to seek an order of 15 U.S.C. § 16, including making copies (the ‘‘Criminal Action’’) that will allege
contempt from the Court. GS Caltex available to the public of this Final that GS Caltex participated in a
agrees that in any civil contempt action, Judgment, the Competitive Impact combination and conspiracy beginning
any motion to show cause, or any Statement, and any comments thereon at least in or around March 2005 and
similar action brought by the United and the United States’ responses to continuing until at least in or around
States regarding an alleged violation of comments. Based upon the record October 2016, to suppress and eliminate
this Final Judgment, the United States before the Court, which includes the competition on certain contracts
may establish a violation of the decree Competitive Impact Statement and any solicited by the DoD to supply ultra-low
and the appropriateness of any remedy comments and response to comments sulfur diesel and gasoline to numerous
therefor by a preponderance of the filed with the Court, entry of this Final U.S. Army, Navy, Marine, and Air Force
evidence, and GS Caltex waives any Judgment is in the public interest. installations in Korea, known as PC&S
argument that a different standard of contracts, in violation of the Sherman
proof should apply. Dated: lllllllllllllllll Antitrust Act, 15 U.S.C. § 1.
B. The Final Judgment should be lllllllllllllllllllll D. GS Caltex will execute a
interpreted to give full effect to the United States District Judge Stipulation with the Antitrust Division
procompetitive purposes of the antitrust of the United States Department of
amozie on DSK3GDR082PROD with NOTICES2
laws and to restore all competition the ATTACHMENT 1 Justice in which GS Caltex will consent
United States alleged was harmed by the to the entry of a Final Judgment to be
challenged conduct. GS Caltex agrees SETTLEMENT AGREEMENT filed in United States v. GS Caltex
that they may be held in contempt of, This Settlement Agreement Corporation, Civil Action No. [to be
and that the Court may enforce, any (Agreement) is entered into among the assigned] (S.D. Ohio) (the Civil Antitrust
provision of this Final Judgment that, as United States of America, acting Action) that will settle any and all civil
interpreted by the Court in light of these through the Civil Division of the United antitrust claims of the United States
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![Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices 60313
by GS Caltex, or the effect of any such Kong, or any other mutually agreed 19. This Agreement is binding on GS
Unallowable Costs on the amount of upon place, (ii) at trial in the United Caltex’s successors, transferees, heirs,
such payments. States, and (iii) at any other judicial and assigns.
10. GS Caltex agrees to cooperate fully proceedings wherever located related to 20. This Agreement is binding on
and truthfully with the United States in the Civil FCA Action. Relator’s successors, transferees, heirs,
connection with the Civil FCA Action. 11. This Agreement is intended to be and assigns.
The Civil Division of the United States for the benefit of the Parties only.
Department of Justice will use 12. Upon receipt of the payment of 21. All parties consent to the United
reasonable best efforts, where the Total FCA Settlement Amount States’ disclosure of this Agreement,
appropriate, to coordinate any requests described in Paragraph 1.a-c., above, or and information about this Agreement,
for cooperation in connection with the receipt of the Total FCA Settlement to the public, as permitted by order of
Civil FCA Action with requests for Amount and any additional interest that the Court. This Agreement shall not be
cooperation in connection with the Plea accrues if GS Caltex does not pay on or released in un-redacted form until the
Agreement in the Criminal Action and before the Payment Due Date, the Court unseals the entire Civil FCA
the Civil Antitrust Action, so as to avoid United States and Relator shall Action.
unnecessary duplication and expense. promptly sign and file a Joint 22. This Agreement is effective on the
GS Caltex’s ongoing, full, and truthful Stipulation of Dismissal, with prejudice, date of signature of the last signatory to
cooperation shall include, but not be of the claims filed against GS Caltex in the Agreement (Effective Date of this
limited to: the Civil FCA Action, pursuant to Rule Agreement). Electronic copies of
a. upon request by the United States 41(a)(1), which dismissal shall be signatures shall constitute acceptable,
with reasonable notice, producing at the conditioned on the Court retaining
offices of counsel for the United States binding signatures for purposes of this
jurisdiction over Relator’s claims to a Agreement
in Washington, D.C. and not at the relator’s share and recovery of attorneys’
expense of the United States, complete fees and costs pursuant to 31 U.S.C. The United States of America
and un-redacted copies of all non- § 3730(d). Dated: lllllllllllllllll
privileged documents related to the By: lllllllllllllllllll
13. Except as provided herein, each
Covered Conduct wherever located in
Party shall bear its own legal and other Andrew A. Steinberg,
GS Caltex’s possession, custody, or
costs incurred in connection with this Trial Attorney, Commercial Litigation
control;
b. upon request by the United States matter. The Parties agree that Relator Branch, Civil Division, U.S. Department of
with reasonable notice, making current and GS Caltex will not seek to recover Justice
GS Caltex directors, officers, and from the United States any costs or fees Dated: lllllllllllllllll
employees available for interviews, related to the preparation and By: lllllllllllllllllll
consistent with the rights and privileges performance of this Agreement.
Mark T. D’Alessandro,
of such individuals, by counsel for the 14. Each party and signatory to this
Civil Chief
United States and/or their investigative Agreement represents that it freely and
Andrew Malek,
agents, not at the expense of the United voluntarily enters into this Agreement
Assistant United States Attorney, U.S.
States, in the United States or Hong without any degree of duress or Attorney’s Office for the Southern District of
Kong unless another place is mutually compulsion. Ohio
agreed upon; 15. This Agreement is governed by the
GS Caltex Corporation—Defendant
c. upon request by the United States laws of the United States. The exclusive
jurisdiction and venue for any dispute Dated: lllllllllllllllll
with reasonable notice, (i) using best
efforts to assist in locating former GS relating to this Agreement is the United By: lllllllllllllllllll
Caltex directors, officers, and employees States District Court for the Southern Authorized Representative of GS Caltex
identified by attorneys and/or District of Ohio. GS Caltex agrees that Corporation
investigative agents of the United States, the United States District Court for the Dated: lllllllllllllllll
and (ii) using best efforts to make any Southern District of Ohio has
By: lllllllllllllllllll
such former GS Caltex directors, jurisdiction over it for purposes of the
Civil FCA Action. For purposes of Marguerite M. Sullivan,
officers, and employees available for
construing this Agreement, this Latham & Watkins LLP
interviews, consistent with the rights
and privileges of such individuals, by Agreement shall be deemed to have Scott D. Hammond, Gibson, Dunn & Crutcher
counsel for the United States and/or been drafted by all Parties to this LLP, Counsel for GS Caltex Corporation
their investigative agents, not at the Agreement and shall not, therefore, be [Redacted]—Relator
expense of the United States, in the construed against any Party for that Dated: lllllllllllllllll
United States or Hong Kong unless reason in any subsequent dispute. By: lllllllllllllllllll
another place is mutually agreed upon; 16. This Agreement constitutes the
[redacted]
and complete agreement between the Parties
d. upon request by the United States on the subject matters addressed herein. Dated: lllllllllllllllll
with reasonable notice, making current This Agreement may not be amended By: lllllllllllllllllll
GS Caltex directors, officers, and except by written consent of the Parties. Eric Havian,
employees available, and using best 17. The undersigned counsel Constantine Cannon LLP, Counsel for Relator
efforts to make former GS Caltex represent and warrant that they are fully
amozie on DSK3GDR082PROD with NOTICES2
directors, officers, employees available, authorized to execute this Agreement on United States District Court for the
to testify, consistent with the rights and behalf of the persons and entities Southern District of Ohio Eastern
privileges of such individuals, fully, indicated below. Division
truthfully, and under oath, without 18. This Agreement may be executed
falsely implicating any person or in counterparts, each of which United States of America, Plaintiff, v.
withholding any information, (i) at constitutes an original and all of which Hanjin Transportation Co., Ltd. Defendant.
depositions in the United States, Hong constitute one and the same Agreement. Case No. 2:18–cv–01456–ALM–CMV
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![60314 Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices
PROPOSED FINAL JUDGMENT AS TO Documents Group at (202) 514–2481 for information and/or testimony as
DEFENDANT HANJIN instructions before making the transfer. requested by the United States in
TRANSPORTATION CO., LTD. If the payment is made by cashier’s connection with any Civil Federal
WHEREAS Plaintiff, United States of check, the check shall be made payable Proceeding, including the provision of
America, filed its Complaint on to the United States Department of testimony in trial and other judicial
November 14, 2018, the United States Justice and delivered to: Janie Ingalls, proceedings, as well as interviews with
and Defendant Hanjin Transportation United States Department of Justice law enforcement authorities, consistent
Co., Ltd. (‘‘Hanjin’’), by their respective Antitrust Division, Antitrust Documents with the rights and privileges of those
attorneys, have consented to the entry of Group, 450 5th Street, NW, Suite 1024, individuals;
this Final Judgment without trial or Washington, D.C. 20530. In the event of (c) Using its best efforts to make
adjudication of any issue of fact or law; a default in payment, interest at the rate available in the United States, at no
WHEREAS, on such date as may be of eighteen (18) percent per annum shall expense to the United States, its former
determined by the Court, Hanjin will accrue thereon from the date of default officers, directors, employees, and
plead guilty pursuant to Fed. R. Crim. to the date of payment. agents to provide information and/or
P. 11(c)(1)(C) (the ‘‘Plea Agreement’’) to testimony as requested by the United
IV. COOPERATION States in connection with any Civil
an Information to be filed in United
States v. Hanjin Transportation Co., Ltd. Hanjin shall cooperate fully with the Federal Proceeding, including the
[to be assigned] (S.D.Ohio) (the United States regarding any matter provision of testimony in trial and other
‘‘Criminal Action’’) that will allege a about which Hanjin has knowledge or judicial proceedings, as well as
violation of Section 1 of the Sherman information relating to any ongoing civil interviews with law enforcement
Act, 15 U.S. C. § 1, relating to the same investigation, litigation, or other authorities, consistent with the rights
events giving rise to the allegations proceeding arising out of any ongoing and privileges of those individuals;
described in the Complaint; federal investigation of the subject (d) Providing testimony or
WHEREAS, this Final Judgment does matter discussed in the Complaint information necessary to identify or
not constitute any evidence against or (hereinafter, any such investigation, establish the original location,
admission by any party regarding any litigation, or proceeding shall be authenticity, or other basis for
issue of fact or law; referred to as a ‘‘Civil Federal admission into evidence of documents
NOW, THEREFORE, before the taking Proceeding’’). or physical evidence produced by
of any testimony and without trial or The United States agrees that any Hanjin in any Civil Federal Proceeding
final adjudication of any issue of fact or cooperation provided in connection as requested by the United States; and
law herein, and upon consent of the with the Plea Agreement and/or (e) Completely and truthfully
parties hereto, it is hereby ORDERED, pursuant to the settlement agreement responding to all other inquiries of the
ADJUDGED, AND DECREED: attached hereto as Attachment 1 will be United States in connection with any
considered cooperation for purposes of Civil Federal Proceeding.
I. JURISDICTION this Final Judgment, and the United However, notwithstanding any
This Court has jurisdiction of the States will use its reasonable best provision of this Final Judgment, Hanjin
subject matter of this action and each of efforts, where appropriate, to coordinate is not required to: (1) request of its
the parties consenting hereto. The any requests for cooperation in current or former officers, directors,
Complaint states a claim upon which connection with the Civil Federal employees, or agents that they forgo
relief may be granted to the United Proceeding with requests for seeking the advice of an attorney nor
States against Hanjin under Section 1 of cooperation in connection with the Plea that they act contrary to that advice; (2)
the Sherman Act, 15 U.S.C. § 1. Agreement and the settlement take any action against its officers,
agreement attached hereto as directors, employees, or agents for
II. APPLICABILITY Attachment 1, so as to avoid following their attorney’s advice; or (3)
This Final Judgment applies to unnecessary duplication and expense. waive any claim of privilege or work
Hanjin, as defined above, and all other Hanjin’s cooperation shall include, but product protection.
persons in active concert or not be limited to, the following: The obligations of Hanjin to cooperate
participation with any of them who (a) Upon request, completely and fully with the United States as described
receive actual notice of this Final truthfully disclosing and producing, to in this Section shall cease upon the
Judgment by personal service or the offices of the United States and at no conclusion of all Civil Federal
otherwise. expense to the United States, copies of Proceedings (which may include Civil
all non-privileged information, Federal Proceedings related to the
III. PAYMENT documents, materials, and records in its conduct of third parties), including
Hanjin shall pay to the United States possession (and for any foreign-language exhaustion of all appeals or expiration
within ten (10) business days of the information, documents, materials, or of time for all appeals of any Court
entry of this Final Judgment the amount records, copies must be produced with ruling in each such Civil Federal
of six million, one hundred eighty-two an English translation), regardless of Proceeding, at which point the United
thousand ($6,182,000), less the amount their geographic location, about which States will provide written notice to
paid (excluding any interest) pursuant the United States may inquire in Hanjin that its obligations under this
to the settlement agreement attached connection with any Civil Federal Section have expired.
hereto as Attachment 1, to satisfy all Proceeding, including but not limited to
civil antitrust claims alleged against all information about activities of V. ANTITRUST COMPLIANCE
amozie on DSK3GDR082PROD with NOTICES2
Hanjin by the United States in the Hanjin and present and former officers, PROGRAM
Complaint. Payment of the amount directors, employees, and agents of A. Within thirty (30) days after entry
ordered hereby shall be made by wire Hanjin; of this Final Judgment, Hanjin shall
transfer of funds or cashier’s check. If (b) Making available in the United appoint an Antitrust Compliance Officer
the payment is made by wire transfer, States, at no expense to the United and identify to the United States his or
Hanjin shall contact Janie Ingalls of the States, its present officers, directors, her name, business address, telephone
Antitrust Division’s Antitrust employees, and agents to provide number, and email address. Within
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forty-five (45) days of a vacancy in the that in any civil contempt action, any Statement, and any comments thereon
Antitrust Compliance Officer position, motion to show cause, or any similar and the United States’ responses to
Hanjin shall appoint a replacement, and action brought by the United States comments. Based upon the record
shall identify to the United States the regarding an alleged violation of this before the Court, which includes the
Antitrust Compliance Officer’s name, Final Judgment, the United States may Competitive Impact Statement and any
business address, telephone number, establish a violation of the decree and comments and response to comments
and email address. Hanjin’s initial or the appropriateness of any remedy filed with the Court, entry of this Final
replacement appointment of an therefor by a preponderance of the Judgment is in the public interest.
Antitrust Compliance Officer is subject evidence, and Hanjin waives any Dated: lllllllllllllllll
to the approval of the United States, in argument that a different standard of llllllllllllllllllll
its sole discretion. proof should apply. United States District Judge
B. The Antitrust Compliance Officer B. The Final Judgment should be
shall institute an antitrust compliance interpreted to give full effect to the ATTACHMENT 1
program for the company’s employees procompetitive purposes of the antitrust
SETTLEMENT AGREEMENT
and directors with responsibility for laws and to restore all competition the
bidding for any contract with the United United States alleged was harmed by the This Settlement Agreement
States. The antitrust compliance challenged conduct. Hanjin agrees that (Agreement) is entered into among the
program shall provide at least two hours they may be held in contempt of, and United States of America, acting
of training annually on the antitrust that the Court may enforce, any through the Civil Division of the United
laws of the United States, such training provision of this Final Judgment that, as States Department of Justice and the
to be delivered by an attorney with interpreted by the Court in light of these United States Attorney’s Office for the
relevant experience in the field of procompetitive principles and applying Southern District of Ohio, on behalf of
United States antitrust law. ordinary tools of interpretation, is stated the Defense Logistics Agency (DLA) and
C. Each Antitrust Compliance Officer specifically and in reasonable detail, the Army and Air Force Exchange
shall obtain, within six months after whether or not it is clear and Service (AAFES) (collectively the
entry of this Final Judgment, and on an unambiguous on its face. In any such ‘‘United States’’), Hanjin Transportation
annual basis thereafter, on or before interpretation, the terms of this Final Co., Ltd. (Hanjin), and Relator
each anniversary of the entry of this Judgment should not be construed [REDACTED] (hereafter collectively
Final Judgment, from each person against either party as the drafter. referred to as ‘‘the Parties’’), through
subject to Paragraph V.B of this Final C. In any enforcement proceeding in their authorized representatives.
Judgment, and thereafter maintaining, a which the Court finds that Hanjin has RECITALS
certification that each such person has violated this Final Judgment, the United
received the required two hours of States may apply to the Court for a one- A. Hanjin is a South Korea-based
annual antitrust training. time extension of this Final Judgment, logistics company with South Korean
D. Each Antitrust Compliance Officer together with such other relief as may be and international customers, including
shall communicate annually to all appropriate. In connection with any the United States Department of Defense
employees that they may disclose to the successful effort by the United States to (DoD).
Antitrust Compliance Officer, without enforce this Final Judgment against B. On February 28, 2018, Relator, a
reprisal, information concerning any Hanjin, whether litigated or resolved resident and citizen of South Korea,
potential violation of the United States prior to litigation, Hanjin agrees to filed a qui tam action in the United
antitrust laws. reimburse the United States for the fees States District Court for the Southern
E. Each Antitrust Compliance Offer and expenses of its attorneys, as well as District of Ohio captioned United States
shall provide to the United States any other costs including experts’ fees, ex rel. [REDACTED] v. GS Caltex, et al.,
within six months after entry of this incurred in connection with that Civil Action No. [REDACTED], pursuant
Final Judgment, and on an annual basis enforcement effort, including in the to the qui tam provisions of the False
thereafter, on or before each anniversary investigation of the potential violation. Claims Act, 31 U.S.C. § 3730(b) (the
of the entry of this Final Judgment, a Civil FCA Action). Relator contends that
VIII. EXPIRATION OF FINAL Hanjin conspired with other South
written statement as to the fact and
JUDGMENT Korean entities to rig bids on DoD
manner of Hanjin’s compliance with
Section V of this Final Judgment. Unless this Court grants an extension, contracts to supply fuel to U.S. military
this Final Judgment shall expire seven bases throughout South Korea beginning
VI. RETENTION OF JURISDICTION (7) years from the date of its entry, in 2008 and continuing until 2016,
This Court retains jurisdiction to except that after five (5) years from the including DLA Post, Camps, and
enable any of the parties to this Final date of its entry, this Final Judgment Stations contracts executed in 2009 and
Judgment to apply to this Court at any may be terminated upon notice by the 2013, and AAFES contracts executed in
time for further orders and directions as United States to the Court and Hanjin 2008.
may be necessary or appropriate to carry that the continuation of the Final C. On such date as may be determined
out or construe this Final Judgment, to Judgment no longer is necessary or in by the Court, Hanjin will plead guilty
modify or terminate any of its the public interest. pursuant to Fed. R. Crim. P. 11(c)(1)(C)
provisions, to enforce compliance, and (the ‘‘Plea Agreement’’) to an
IX. PUBLIC INTEREST Information to be filed in United States
to punish violations of its provisions.
DETERMINATION v. Hanjin Transportation Co., Ltd.,
amozie on DSK3GDR082PROD with NOTICES2
VII. ENFORCEMENT OF FINAL Entry of this Final Judgment is in the Criminal Action No. [to be assigned]
JUDGMENT public interest. The parties have (S.D. Ohio) (the ‘‘Criminal Action’’) that
A. The United States retains and complied with the requirements of the will allege that Hanjin participated in a
reserves all rights to enforce the Antitrust Procedures and Penalties Act, combination and conspiracy beginning
provisions of this Final Judgment, 15 U.S.C. § 16, including making copies at least in or around March 2005 and
including the right to seek an order of available to the public of this Final continuing until at least in or around
contempt from the Court. Hanjin agrees Judgment, the Competitive Impact October 2016, to suppress and eliminate
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competition on certain contracts instructions to be provided by the Civil statute or regulation or otherwise, or in
solicited by the DoD to supply ultra-low Division of the United States common law, including claims for
sulfur diesel and gasoline to numerous Department of Justice. Relator claims attorneys’ fees, costs, and expenses of
U.S. Army, Navy, Marine, and Air Force entitlement under 31 U.S.C. § 3730(d) to every kind and however denominated,
installations in Korea, including PC&S Relator’s reasonable expenses, attorneys’ that Relator would have standing to
contracts, in violation of the Sherman fees and costs. The FCA Settlement bring or which Relator may now have or
Antitrust Act, 15 U.S.C. § 1. Amount does not include the Relator’s claim to have against Hanjin and/or its
D. Hanjin will execute a Stipulation fees and costs, and Hanjin direct and indirect subsidiaries, brother
with the Antitrust Division of the acknowledges (without waiving any or sister corporations, divisions, current
United States Department of Justice in applicable arguments or defenses) that or former corporate owners, and the
which Hanjin will consent to the entry Relator retains all rights to seek to corporate successors and assigns of any
of a Final Judgment to be filed in United recover such expenses, attorneys’ fees, of them.
States v. Hanjin Transportation Co., and costs from Hanjin pursuant to 31 4. Notwithstanding the releases given
Ltd., Civil Action No. [to be assigned] U.S.C. § 3730(d). in paragraphs 2 and 3 of this Agreement,
(S.D. Ohio) (the Civil Antitrust Action) 2. Subject to the exceptions in or any other term of this Agreement, the
that will settle any and all civil antitrust Paragraph 4 (concerning excluded following claims of the United States are
claims of the United States against claims) below, and conditioned upon specifically reserved and are not
Hanjin arising from any act or offense Hanjin’s full payment of the FCA released:
committed before the date of the Settlement Amount, the United States a. Any liability arising under Title 26,
Stipulation that was undertaken in releases Hanjin together with its current U.S. Code (Internal Revenue Code);
furtherance of an attempted or and former parent corporations; direct b. Any criminal liability, except to the
completed antitrust conspiracy and indirect subsidiaries; brother or extent detailed in the Plea Agreement;
involving PC&S and/or AAFES fuel sister corporations; divisions; current or c. Except as explicitly stated in this
supply contracts with the U.S. military former corporate owners; and the Agreement, any administrative liability,
in South Korea during the period 2005 corporate successors and assigns of any including the suspension and
through 2016. of them from any civil or administrative debarment rights of any federal agency;
E. The United States contends that it monetary claim the United States has d. Any liability to the United States
has certain civil claims against Hanjin for the Covered Conduct under the False (or its agencies) for any conduct other
arising from a conspiracy with other Claims Act, 31 U.S.C. §§ 3729–3733; the than the Covered Conduct;
South Korean entities to rig bids on DoD Program Fraud Civil Remedies Act, 31 e. Any liability based upon
contracts to supply fuel to U.S. military U.S.C. §§ 3801–3812; Contract Disputes obligations created by this Agreement;
bases throughout South Korea beginning Act, 41 U.S.C. §§ 7101–7109; or the f. Any liability of individuals;
in 2008 and continuing to 2016, common law theories of breach of g. Any liability for express or implied
including DLA Post, Camps, and contract, payment by mistake, unjust warranty claims or other claims for
Stations contracts executed in 2009 and enrichment, and fraud. defective or deficient products or
2013, and AAFES contracts executed in 3. Except as set forth in Paragraph 1 services, including quality of goods and
2008. The conduct described in in this (concerning Relator’s claims under 31 services;
Paragraph, as well as the conduct, U.S.C. § 3730(d)), and subject to the h. Any liability for failure to deliver
actions, and claims alleged by Relator in exceptions in Paragraph 4 below, and goods or services due; and
the Civil FCA Action is referred to conditioned upon Hanjin’s full payment i. Any liability for personal injury or
below as the Covered Conduct. of the FCA Settlement Amount, Relator, property damage or for other
F. With the exception of any on behalf of: (a) his respective heirs, consequential damages arising from the
admissions that are made by Hanjin in successors, assigns, agents and Covered Conduct.
connection with the Plea Agreement in attorneys; and (b) his companies 5. Relator and his heirs, successors,
the Criminal Action, this Settlement ([REDACTED], together with their direct attorneys, agents, and assigns shall not
Agreement is neither an admission of and indirect subsidiaries, brother or object to this Agreement but agree and
liability by Hanjin nor a concession by sister corporations, divisions, current or confirm that this Agreement is fair,
the United States or Relator that their former corporate owners, and the adequate, and reasonable under all the
claims are not well founded. corporate successors and assigns of any circumstances, pursuant to 31 U.S.C.
G. Relator claims entitlement under of them); hereby fully and finally § 3730(c)(2)(B). In connection with this
31 U.S.C. § 3730(d) to a share of the releases, waives, and forever discharges Agreement and this Civil FCA Action,
proceeds of this Settlement Agreement Hanjin, together with its direct and Relator, on behalf of himself and his
and to Relator’s reasonable expenses, indirect subsidiaries, brother or sister heirs, successors, attorneys, agents, and
attorneys’ fees, and costs. corporations, divisions, current or assigns, agrees that neither this
To avoid the delay, uncertainty, former corporate owners, and the Agreement, nor any intervention by the
inconvenience, and expense of corporate successors and assigns of any United States in the Civil FCA Action in
protracted litigation of the above claims, of them, from: (i) any civil monetary order to dismiss the Civil FCA Action,
and in consideration of the mutual claim Relator has on behalf of the nor any dismissal of the Civil FCA
promises and obligations of this United States for the Covered Conduct Action, shall waive or otherwise affect
Settlement Agreement, the Parties agree under the False Claims Act, 31 U.S.C. the ability of the United States to
and covenant as follows: §§ 3729–3733; (ii) any claims or contend that provisions in the False
allegations Relator has asserted or could Claims Act, including 31 U.S.C.
amozie on DSK3GDR082PROD with NOTICES2
TERMS AND CONDITIONS have asserted against Hanjin arising § 3730(d)(3), bar Relator from sharing in
1. Hanjin agrees to pay to the United from the Covered Conduct; and (iii) all the proceeds of this Agreement, except
States $6,182,000 (FCA Settlement liability, claims, demands, actions or that the United States will not contend
Amount) by electronic funds transfer no causes of action whatsoever, whether that Relator is barred from sharing in the
later than thirteen (13) business days known or unknown, fixed or contingent, proceeds of this Agreement pursuant to
after the Effective Date of this in law or in equity, in contract or in tort, 31 U.S.C. § 3730(e)(4). Moreover, the
Agreement pursuant to written under any federal, Korean, or state United States and Relator, on behalf of
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himself and his heirs, successors, officers, directors, employees, cooperation shall include, but not be
attorneys, agents, and assigns agree that shareholders, and agents in connection limited to:
they each retain all of their rights with: a. upon request by the United States
pursuant to the False Claims Act on the (1) the matters covered by this with reasonable notice, producing at the
issue of the share percentage, if any, that Agreement, any related plea agreement, offices of counsel for the United States
Relator should receive of any proceeds and any related civil antitrust in Washington, D.C. and not at the
of the settlement of his claims, and that agreement; expense of the United States, complete
no agreements concerning Relator share (2) the United States’ audit(s) and and un-redacted copies of all non-
have been reached to date. civil and any criminal investigation(s) of privileged documents related to the
6. Hanjin waives and shall not assert the matters covered by this Agreement; Covered Conduct wherever located in
any defenses Hanjin may have to any (3) Hanjin’s investigation, defense, Hanjin’s possession, custody, or control,
criminal prosecution or administrative and corrective actions undertaken in including but not limited to, reports,
action relating to the Covered Conduct response to the United States’ audit(s) memoranda of interviews, and records
that may be based in whole or in part and civil and any criminal concerning any investigation of the
on a contention that, under the Double investigation(s) in connection with the Covered Conduct that Hanjin has
Jeopardy Clause in the Fifth matters covered by this Agreement undertaken, or that has been performed
Amendment of the Constitution, or (including attorney’s fees); by another on Hanjin’s behalf;
under the Excessive Fines Clause in the (4) the negotiation and performance of b. upon request by the United States
Eighth Amendment of the Constitution, this Agreement, any related plea with reasonable notice, making current
this Agreement bars a remedy sought in agreement, and any related civil Hanjin directors, officers, and
such criminal prosecution or antitrust agreement; employees available for interviews,
administrative action. (5) the payment Hanjin makes to the consistent with the rights and privileges
7. Hanjin fully and finally releases the United States pursuant to this of such individuals, by counsel for the
United States, its agencies, officers, Agreement and any payments that United States and/or their investigative
agents, employees, and servants, from Hanjin may make to Relator, including agents, not at the expense of the United
any claims (including attorney’s fees, costs and attorneys’ fees, States, in the United States or Hong
costs, and expenses of every kind and Kong, unless another place is mutually
are unallowable costs for government
however denominated) that Hanjin has agreed upon;
contracting purposes (hereinafter c. upon request by the United States
asserted, could have asserted, or may
referred to as Unallowable Costs). with reasonable notice, (i) using best
assert in the future against the United
States, its agencies, officers, agents, b. Future Treatment of Unallowable efforts to assist in locating former
employees, and servants, related to the Costs: Unallowable Costs will be Hanjin directors, officers, and
Covered Conduct and the United States’ separately determined and accounted employees identified by attorneys and/
investigation and prosecution thereof. for by Hanjin, and Hanjin shall not or investigative agents of the United
8. Hanjin, together with its direct and charge such Unallowable Costs directly States, and (ii) using best efforts to make
indirect subsidiaries, brother or sister or indirectly to any contract with the any such former Hanjin directors,
corporations, divisions, current or United States. officers, and employees available for
former corporate owners, and the c. Treatment of Unallowable Costs interviews, consistent with the rights
corporate successors and assigns of any Previously Submitted for Payment: and privileges of such individuals, by
of them, hereby fully and finally Within 90 days of the Effective Date of counsel for the United States and/or
releases, waives, and forever discharges this Agreement, Hanjin shall identify their investigative agents, not at the
the Relator, together with his respective and repay by adjustment to future expense of the United States, in the
heirs, successors, assigns, agents and claims for payment or otherwise any United States or Hong Kong, unless
attorneys, and his companies Unallowable Costs included in another place is mutually agreed upon;
([REDACTED]) from any claims or payments previously sought by Hanjin and
allegations Hanjin has asserted or could or any of its subsidiaries or affiliates d. upon request by the United States
have asserted, arising from the Covered from the United States. Hanjin agrees with reasonable notice, making current
Conduct, and from all liability, claims, that the United States, at a minimum, Hanjin directors, officers, and
demands, actions or causes of action shall be entitled to recoup from Hanjin employees available, and using best
whatsoever, whether known or any overpayment plus applicable efforts to make former Hanjin directors,
unknown, fixed or contingent, in law or interest and penalties as a result of the officers, employees available, to testify,
in equity, in contract or in tort, under inclusion of such Unallowable Costs on consistent with the rights and privileges
any federal, Korean, or state statute or previously-submitted requests for of such individuals, fully, truthfully,
regulation or otherwise, or in common payment. The United States, including and under oath, without falsely
law, including claims for attorneys’ fees, the Department of Justice and/or the implicating any person or withholding
costs, and expenses of every kind and affected agencies, reserves its rights to any information, (i) at depositions in the
however denominated, that it would audit, examine, or re-examine Hanjin’s United States, Hong Kong, or any other
have standing to bring or which Hanjin books and records and to disagree with mutually agreed upon place, (ii) at trial
may now have or claim to have against any calculations submitted by Hanjin or in the United States, and (iii) at any
Relator and his heirs, successors, any of its subsidiaries or affiliates other judicial proceedings wherever
assigns, agents, and attorneys. Relator regarding any Unallowable Costs located related to the Civil FCA Action.
hereby represents that neither he nor his included in payments previously sought 11. This Agreement is intended to be
amozie on DSK3GDR082PROD with NOTICES2
companies, [REDACTED], performed by Hanjin, or the effect of any such for the benefit of the Parties only.
business with Hanjin. Unallowable Costs on the amount of 12. Upon receipt of the payment of
9. a. Unallowable Costs Defined: All such payments. the FCA Settlement Amount described
costs (as defined in the Federal 10. Hanjin agrees to cooperate fully in Paragraph 1 above, the United States
Acquisition Regulation, 48 C.F.R. and truthfully with the United States in and Relator shall promptly sign and file
§ 31.205–47) incurred by or on behalf of connection with the Civil FCA Action. a Joint Stipulation of Dismissal, with
Hanjin, and its present or former Hanjin’s ongoing, full, and truthful prejudice, of the claims filed against
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Hanjin in the Civil FCA Action, the Agreement (Effective Date of this Section 1 of the Sherman Act, 15 U.S.
pursuant to Rule 41(a)(1) ), which Agreement). Facsimiles of signatures C. § 1, relating to the same events giving
dismissal shall be conditioned on the shall constitute acceptable, binding rise to the allegations described in the
Court retaining jurisdiction over signatures for purposes of this Complaint;
Relator’s claims to a relator’s share and Agreement. WHEREAS, this Final Judgment does
recovery of attorneys’ fees and costs The United States of America not constitute any evidence against or
pursuant to 31 U.S.C. § 3730(d). Dated: lllllllllllllllll admission by any party regarding any
13. Except with respect to payment (if
By: lllllllllllllllllll issue of fact or law;
any) by Hanjin of Relator’s attorneys’
fees, expenses, and costs pursuant to 31 Andrew A. Steinberg, NOW, THEREFORE, before the taking
Trial Attorney, Commercial Litigation of any testimony and without trial or
U.S.C. § 3730(d), each Party shall bear Branch, Civil Division, U.S. Department of
its own legal and other costs incurred in final adjudication of any issue of fact or
Justice
connection with this matter. The Parties law herein, and upon consent of the
Dated: lllllllllllllllll
agree that Relator and Hanjin will not parties hereto, it is hereby ORDERED,
By: lllllllllllllllllll ADJUDGED, AND DECREED:
seek to recover from the United States
any costs or fees related to the Mark T. D’Alessandro
Civil Chief I. JURISDICTION
preparation and performance of this
Agreement. Andrew Malek
Assistant United States Attorney, U.S. This Court has jurisdiction of the
14. Each party and signatory to this subject matter of this action and each of
Attorney’s Office for the Southern District of
Agreement represents that it freely and Ohio the parties consenting hereto. The
voluntarily enters in to this Agreement Complaint states a claim upon which
Hanjin Transportation Co., Ltd.—Defendant
without any degree of duress or relief may be granted to the United
compulsion. Dated: lllllllllllllllll
By: lllllllllllllllllll States against SK Energy under Section
15. This Agreement is governed by the
Authorized Representative of Hanjin
1 of the Sherman Act, 15 U.S.C. § 1.
laws of the United States. The exclusive
jurisdiction and venue for any dispute Transportation Co., Ltd. II. APPLICABILITY
relating to this Agreement is the United Dated: lllllllllllllllll
States District Court for the Southern By: lllllllllllllllllll This Final Judgment applies to SK
District of Ohio. Hanjin agrees that the William H. Stallings Energy, as defined above, and all other
United States District Court for the Counsel for Hanjin Transportation Co., Ltd. persons in active concert or
Southern District of Ohio has Dated: lllllllllllllllll participation with any of them who
jurisdiction over it for purposes of the By: lllllllllllllllllll receive actual notice of this Final
Civil FCA Action. For purposes of Judgment by personal service or
Kelly B. Kramer
construing this Agreement, this Counsel for Hanjin Transportation Co., Ltd. otherwise.
Agreement shall be deemed to have [Redacted]—Relator III. PAYMENT
been drafted by all Parties to this Dated: lllllllllllllllll
Agreement and shall not, therefore, be SK Energy shall pay to the United
By: lllllllllllllllllll
construed against any Party for that States within ten (10) business days of
reason in any subsequent dispute. [Redacted]
the entry of this Final Judgment the
16. This Agreement constitutes the Dated: lllllllllllllllll
amount of ninety million, three hundred
complete agreement between the Parties By: lllllllllllllllllll eighty-four thousand, eight hundred and
on the subject matters addressed herein. Eric Havian seventy-two dollars ($90,384,872), less
This Agreement may not be amended Constantine Cannon LLP, Counsel for Relator the amount paid (excluding any
except by written consent of the Parties. United States District Court for the interest) pursuant to the settlement
17. The undersigned counsel agreement attached hereto as
Southern District of Ohio Eastern
represent and warrant that they are fully Attachment 1, to satisfy all civil
Division
authorized to execute this Agreement on antitrust claims alleged against SK
behalf of the persons and entities United States of America, Plaintiff, v. SK
Energy Co., Ltd. Defendant. Energy by the United States in the
indicated below. Complaint. Payment of the amount
18. This Agreement may be executed Case No. 2:18-cv-01456-ALM-CMV
ordered hereby shall be made by wire
in counterparts, each of which PROPOSED FINAL JUDGMENT AS TO transfer of funds or cashier’s check. If
constitutes an original and all of which DEFENDANT SK ENERGY CO., LTD. the payment is made by wire transfer,
constitute one and the same Agreement.
19. This Agreement is binding on WHEREAS Plaintiff, United States of SK Energy shall contact Janie Ingalls of
Hanjin’s successors, transferees, heirs, America, filed its Complaint on the Antitrust Division’s Antitrust
and assigns. November 14, 2018, the United States Documents Group at (202) 514–2481 for
20. This Agreement is binding on and Defendant SK Energy Co., Ltd. (‘‘SK instructions before making the transfer.
Relator’s successors, transferees, heirs, Energy’’), by their respective attorneys, If the payment is made by cashier’s
and assigns. have consented to the entry of this Final check, the check shall be made payable
21. All parties consent to the United Judgment without trial or adjudication to the United States Department of
States’ disclosure of this Agreement, of any issue of fact or law; Justice and delivered to: Janie Ingalls,
and information about this Agreement, WHEREAS, on such date as may be United States Department of Justice
amozie on DSK3GDR082PROD with NOTICES2
to the public, as permitted by order of determined by the Court, SK Energy will Antitrust Division, Antitrust Documents
the Court. This Agreement shall not be plead guilty pursuant to Fed. R. Crim. Group, 450 5th Street, NW, Suite 1024,
released in un-redacted form until the P. 11(c)(1)(C) (the ‘‘Plea Agreement’’) to Washington, D.C. 20530. In the event of
Court unseals the entire Civil FCA an Information to be filed in United a default in payment, interest at the rate
Action. States v. SK Energy Co., Ltd. [to be of eighteen (18) percent per annum shall
22. This Agreement is effective on the assigned] (S.D.Ohio) (the ‘‘Criminal accrue thereon from the date of default
date of signature of the last signatory to Action’’) that will allege a violation of to the date of payment.
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procompetitive purposes of the antitrust ATTACHMENT 1 to the entry of a Final Judgment to be
laws and to restore all competition the filed in United States v. SK Energy Co.,
SETTLEMENT AGREEMENT
United States alleged was harmed by the Ltd., Civil Action No. [to be assigned]
challenged conduct. SK Energy agrees This Settlement Agreement (S.D. Ohio) (the Civil Antitrust Action)
that they may be held in contempt of, (Agreement) is entered into among the that will settle any and all civil antitrust
and that the Court may enforce, any United States of America, acting claims of the United States against SK
provision of this Final Judgment that, as through the Civil Division of the United Energy arising from any act or offense
interpreted by the Court in light of these States Department of Justice and the committed before the date of the
procompetitive principles and applying United States Attorney’s Office for the Stipulation that was undertaken in
ordinary tools of interpretation, is stated Southern District of Ohio, on behalf of furtherance of an attempted or
specifically and in reasonable detail, the Defense Logistics Agency (DLA) and completed antitrust conspiracy
whether or not it is clear and the Army and Air Force Exchange involving PC&S and/or AAFES fuel
unambiguous on its face. In any such Service (AAFES) (collectively the supply contracts with the U.S. military
interpretation, the terms of this Final ‘‘United States’’), SK Energy Co., Ltd. in South Korea during the period 2005
Judgment should not be construed (SK Energy), and Relator [REDACTED] through 2016.
against either party as the drafter. (hereafter collectively referred to as ‘‘the E. The United States contends that it
C. In any enforcement proceeding in Parties’’), through their authorized has certain civil claims against SK
which the Court finds that SK Energy representatives. Energy arising from the conduct
has violated this Final Judgment, the RECITALS described in the Plea Agreement in the
United States may apply to the Court for Criminal Action and in the Stipulation
A. SK Energy is a South Korea-based in the Civil Antitrust Action, as well as
a one-time extension of this Final
energy company that produces various the conduct, actions, and claims alleged
Judgment, together with such other
petroleum products that it sells to South by Relator in the Civil FCA Action. The
relief as may be appropriate. In
Korean and international customers, conduct referenced in this Paragraph is
connection with any successful effort by
including the United States Department referred to below as the Covered
the United States to enforce this Final
of Defense (DoD). Conduct.
Judgment against SK Energy, whether B. On February 28, 2018, Relator, a
litigated or resolved prior to litigation, F. With the exception of any
resident and citizen of South Korea, admissions that are made by SK Energy
SK Energy agrees to reimburse the filed a qui tam action in the United
United States for the fees and expenses in connection with the Plea Agreement
States District Court for the Southern in the Criminal Action, this Settlement
of its attorneys, as well as any other District of Ohio captioned United States
costs including experts’ fees, incurred in Agreement is neither an admission of
ex rel. [REDACTED] v. GS Caltex, et al., liability by SK Energy nor a concession
connection with that enforcement effort, Civil Action No. [REDACTED], pursuant
including in the investigation of the by the United States that its claims are
to the qui tam provisions of the False not well founded.
potential violation. Claims Act, 31 U.S.C. § 3730(b) (the G. Relator claims entitlement under
VIII. EXPIRATION OF FINAL Civil FCA Action). Relator contends that 31 U.S.C. § 3730(d) to a share of the
JUDGMENT SK Energy conspired with other South proceeds of this Settlement Agreement
Korean entities to rig bids on DoD and to Relator’s reasonable expenses,
Unless this Court grants an extension,
contracts to supply fuel to U.S. military attorneys’ fees and costs.
this Final Judgment shall expire seven
bases throughout South Korea beginning To avoid the delay, uncertainty,
(7) years from the date of its entry,
in 2005 and continuing until 2016, inconvenience, and expense of
except that after five (5) years from the
including DLA Post, Camps, and protracted litigation of the above claims,
date of its entry, this Final Judgment
Stations (PC&S) contracts executed in and in consideration of the mutual
may be terminated upon notice by the
2006, 2009, and 2013, and AAFES promises and obligations of this
United States to the Court and SK
contracts executed in 2008. Settlement Agreement, the Parties agree
Energy that the continuation of the Final
C. On such date as may be determined and covenant as follows:
Judgment no longer is necessary or in
by the Court, SK Energy will plead
the public interest. TERMS AND CONDITIONS
guilty pursuant to Fed. R. Crim. P.
IX. PUBLIC INTEREST 11(c)(1)(C) (the ‘‘Plea Agreement’’) to an 1.a. SK Energy agrees to pay to the
DETERMINATION Information to be filed in United States United States $71,866,000 (FCA
Entry of this Final Judgment is in the v. SK Energy Co., Ltd., Criminal Action Settlement Amount), of which
public interest. The parties have No. [to be assigned] (S.D. Ohio) (the $47,910,887 is restitution, by electronic
complied with the requirements of the ‘‘Criminal Action’’) that will allege that funds transfer no later than thirteen (13)
Antitrust Procedures and Penalties Act, SK Energy participated in a combination business days after the Effective Date of
15 U.S.C. § 16, including making copies and conspiracy beginning at least in or this Agreement pursuant to written
available to the public of this Final around March 2005 and continuing instructions to be provided by the Civil
Judgment, the Competitive Impact until at least in or around October 2016, Division of the Department of Justice.
Statement, and any comments thereon to suppress and eliminate competition Relator claims entitlement under 31
and the United States’ responses to on certain contracts solicited by the DoD U.S.C. § 3730(d) to Relator’s reasonable
comments. Based upon the record to supply fuel to numerous U.S. Army, expenses, attorneys’ fees and costs. The
before the Court, which includes the Navy, Marine, and Air Force FCA Settlement Amount does not
installations in Korea, including PC&S include the Relator’s fees and costs, and
amozie on DSK3GDR082PROD with NOTICES2
Competitive Impact Statement and any
comments and response to comments contracts and the 2008 AAFES contract, SK Energy acknowledges that Relator
filed with the Court, entry of this Final in violation of the Sherman Antitrust retains all rights to recover such
Judgment is in the public interest. Act, 15 U.S.C. § 1. expenses, attorneys’ fees, and costs from
D. SK Energy will execute a SK Energy pursuant to 31 U.S.C.
Dated: lllllllllllllllll Stipulation with the Antitrust Division § 3730(d).
lllllllllllllllllllll of the United States Department of 1.b. If SK Energy’s Plea Agreement in
United States District Judge Justice in which SK Energy will consent the Criminal Action is not accepted by
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![Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices 60323
jurisdiction and venue for any dispute Authorized Representative of SK Energy, Co., conduct described in the Complaint.
relating to this Agreement is the United Ltd. The United States and Defendants have
States District Court for the Southern Dated: lllllllllllllllll stipulated that the proposed Final
District of Ohio. SK Energy agrees that By: lllllllllllllllllll Judgments may be entered after
the United States District Court for the Phillip H. Warren, compliance with the APPA. Entry of the
Southern District of Ohio has Counsel for SK Energy Co., Ltd. proposed Final Judgments would
[Redacted]—Relator terminate this action, except that the
jurisdiction over it for purposes of this
case. For purposes of construing this Dated: lllllllllllllllll Court would retain jurisdiction to
Agreement, this Agreement shall be By: lllllllllllllllllll construe, modify, or enforce the
deemed to have been drafted by all [Redacted] provisions of the proposed Final
Parties to this Agreement and shall not, Dated: lllllllllllllllll Judgments and to punish violations
therefore, be construed against any Party By: lllllllllllllllllll thereof.
for that reason in any subsequent Eric Havian, II. DESCRIPTION OF THE EVENTS
dispute. Counsel for Relator
GIVING RISE TO THE ALLEGED
16. This Agreement constitutes the VIOLATION
UNITED STATES DISTRICT COURT
complete agreement between the Parties
FOR THE SOUTHERN DISTRICT OF A. Defendants
on the subject matter addressed herein.
OHIO EASTERN DIVISION
This Agreement may not be amended GS Caltex is an oil company
except by written consent of the Parties. United States of America, Plaintiff, v. GS headquartered in Seoul, South Korea.
17. The undersigned counsel Caltex Corporation, Hanjin Transportation GS Caltex is a joint venture between GS
represent and warrant that they are fully Co., Ltd., and SK Energy Co., Ltd. Defendants.
Energy, a South Korean corporation, and
authorized to execute this Agreement on Case No. 2:18–cv–01456–ALM–CMV Chevron Corp., a Delaware corporation,
behalf of the persons and entities COMPETITIVE IMPACT STATEMENT which each own a 50 percent interest in
indicated below. GS Caltex. GS Caltex is engaged in the
18. This Agreement may be executed Plaintiff United States of America,
refining and supply of gasoline, diesel,
in counterparts, each of which pursuant to Section 2(b) of the Antitrust
kerosene, and other petroleum products
constitutes an original and all of which Procedures and Penalties Act (‘‘APPA’’
for sale internationally. During the time
constitute one and the same Agreement. or ‘‘Tunney Act’’), 15 U.S.C. § 16(b)-(h),
of the conspiracy, GS Caltex supplied
19. This Agreement is binding on SK files this Competitive Impact Statement
fuel to U.S. military installations in
Energy’s successors, transferees, heirs, relating to the proposed Final
South Korea.
and assigns. Judgments submitted for entry in this Hanjin is a global transportation and
20. This Agreement is binding on civil antitrust proceeding. logistics company based in Seoul, South
Relator’s successors, transferees, heirs, I. NATURE AND PURPOSE OF THE Korea. Hanjin is a member of Hanjin
and assigns. PROCEEDING Group, a South Korean conglomerate
21. All parties consent to the United with U.S. subsidiaries, including Hanjin
On November 14, 2018, the United
States’ disclosure of this Agreement, International America. Beginning in
States filed a civil antitrust complaint
and information about this Agreement, 2009, Hanjin partnered with oil
against Defendants GS Caltex
to the public, as permitted by order of companies, including a co-conspirator
Corporation (‘‘GS Caltex’’), Hanjin
the Court. This Agreement shall not be oil company (‘‘Company A’’), to supply
Transportation Co., Ltd. (‘‘Hanjin’’), and
released in un-redacted form until the fuel to U.S. military installations in
SK Energy Co., Ltd. (‘‘SK Energy’’)
Court unseals the entire Civil FCA South Korea.
alleging that Defendants violated SK Energy is an oil company
Action.
22. This Agreement is effective on the Section 1 of the Sherman Act, 15 U.S.C. headquartered in Seoul, South Korea.
date of signature of the last signatory to § 1. From at least March 2005 and SK Energy is engaged in the refining and
the Agreement (Effective Date of this continuing until at least October 2016 supply of gasoline, diesel, kerosene, and
Agreement). Facsimiles of signatures (‘‘the Relevant Period’’), Defendants and other petroleum products for sale
shall constitute acceptable, binding their co-conspirators conspired to fix internationally. During the time of the
signatures for purposes of this prices and rig bids for the supply of fuel conspiracy, SK Energy supplied fuel to
Agreement. to the U.S. military for its operations in U.S. military installations in South
South Korea. As a result of this illegal Korea.
The United States of America conduct, Defendants and their co-
Dated: lllllllllllllllll Other persons, not named as
conspirators overcharged American defendants in this action, participated
By: lllllllllllllllllll taxpayers by well over $100 million. as co-conspirators in the violation
Andrew A. Steinberg, Defendants have agreed to plead guilty alleged in the Complaint and performed
Trial Attorney, Commercial Litigation to an information charging a criminal
Branch, Civil Division, U.S. Department of
acts and made statements in furtherance
violation of Section 1 of the Sherman thereof. These co-conspirators included,
Justice
Act for this unlawful conduct; in this among others, a logistics firm
Dated: lllllllllllllllll parallel civil action, the United States (‘‘Company B’’) and an oil company
By: lllllllllllllllllll seeks compensation for the injury it (‘‘Company C’’) that jointly supplied
Mark T. D’Alessandro, incurred as a result of the conspiracy. fuel to the U.S. military.
Civil Chief At the same time the Complaint was
Andrew Malek, filed, the United States also filed agreed- B. PC&S and AAFES Contracts
amozie on DSK3GDR082PROD with NOTICES2
Assistant United States Attorney, U.S. upon proposed Final Judgments that The United States military procures
Attorney’s Office for the Southern District of would remedy the violation by having fuel for its installations in South Korea
Ohio GS Caltex, Hanjin, and SK Energy pay through competitive solicitation
SK Energy Co., Ltd.—Defendant $57,500,000, $6,182,000, and processes. Oil companies, either
Dated: lllllllllllllllll $90,384,872, respectively, to the United independently or with a transportation
By: lllllllllllllllllll States. These payments resolve all civil company, submitted bids in response to
Myunghun Lee, claims of the United States related to the these solicitations.
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![60326 Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices
Judgments represent substantial determination that the proposed not reject the proposed remedies
monetary relief while avoiding the time, remedies will cure the antitrust because it believes others are preferable
expense, and uncertainty of a full trial violations alleged in the complaint was and that room must be made for the
on the merits. Further, Defendants’ reasonable, and whether the mechanism government to grant concessions in the
agreements to cooperate with the civil to enforce the final judgment are clear negotiation process for settlements);
investigation and any potential and manageable’’). United States v. Dairy Farmers of Am.,
litigation will enhance the ability of the Under the APPA a court considers, Inc., 2007 U.S. Dist. LEXIS 33230, at *3
United States to obtain relief from the among other things, the relationship (E.D. Ky. 2007) (citing United States v.
remaining conspirators. between the remedy secured and the Microsoft, 231 F. Supp. 2d 144, 152
specific allegations in the government’s (D.D.C. 2002)) (noting that a court ‘‘must
VII. STANDARD OF REVIEW UNDER complaint, whether the decree is
THE APPA FOR THE PROPOSED accord deference to the government’s
sufficiently clear, whether its predictions as to the effect of the
FINAL JUDGMENTS enforcement mechanisms are sufficient, proposed remedies’’); United States v.
The Clayton Act, as amended by the and whether the decree may positively Archer-Daniels-Midland Co., 272 F.
APPA, requires that proposed consent harm third parties. See Microsoft, 56 Supp. 2d 1, 6 (D.D.C. 2003) (noting that
judgments in antitrust cases brought by F.3d at 1458–62; United States v. the court should grant ‘‘due respect to
the United States be subject to a 60-day Medical Mut. of Ohio, 1998 U.S. Dist. the government’s prediction as to the
comment period, after which the court LEXIS 21508, at *2–3 (N.D. Ohio 1998). effect of proposed remedies, its
shall determine whether entry of the With respect to the adequacy of the perception of the market structure, and
proposed Final Judgment ‘‘is in the relief secured by the decree, a court may its views of the nature of the case’’). The
public interest.’’ 15 U.S.C. § 16(e)(1). In not ‘‘engage in an unrestricted ultimate question is whether ‘‘the
making that determination, the court, in evaluation of what relief would best remedies [obtained in the decree are] so
accordance with the statute as amended serve the public.’’ United States v. BNS, inconsonant with the allegations
in 2004, is required to consider: Inc., 858 F.2d 456, 462 (9th Cir. 1988) charged as to fall outside of the ‘reaches
(A) the competitive impact of such (quoting United States v. Bechtel Corp., of the public interest.’ ’’ Microsoft, 56
judgment, including termination of 648 F.2d 660, 666 (9th Cir. 1981)); see F.3d at 1461 (quoting United States v.
alleged violations, provisions for also Microsoft, 56 F.3d at 1460–62; Western Elec. Co., 900 F.2d 283, 309
enforcement and modification, duration United States v. Alcoa, Inc., 152 F. (D.C. Cir. 1990)). To meet this standard,
of relief sought, anticipated effects of Supp. 2d 37, 40 (D.D.C. 2001); InBev, the United States ‘‘need only provide a
alternative remedies actually 2009 U.S. Dist. LEXIS 84787, at *3. factual basis for concluding that the
considered, whether its terms are Instead: settlements are reasonably adequate
ambiguous, and any other competitive [t]he balancing of competing social
considerations bearing upon the remedies for the alleged harms.’’ SBC
and political interests affected by a Commc’ns, 489 F. Supp. 2d at 17.
adequacy of such judgment that the proposed antitrust consent decree must
court deems necessary to a be left, in the first instance, to the Moreover, the court’s role under the
determination of whether the consent discretion of the Attorney General. The APPA is limited to reviewing the
judgment is in the public interest; and court’s role in protecting the public remedy in relationship to the violations
(B) the impact of entry of such interest is one of insuring that the that the United States has alleged in its
judgment upon competition in the government has not breached its duty to complaint, and does not authorize the
relevant market or markets, upon the the public in consenting to the decree. court to ‘‘construct [its] own
public generally and individuals The court is required to determine not hypothetical case and then evaluate the
alleging specific injury from the whether a particular decree is the one decree against that case.’’ Microsoft, 56
violations set forth in the complaint that will best serve society, but whether F.3d at 1459; see also U.S. Airways, 38
including consideration of the public the settlement is ‘‘within the reaches of F. Supp. 3d at 75 (noting that the court
benefit, if any, to be derived from a the public interest.’’ More elaborate must simply determine whether there is
determination of the issues at trial. requirements might undermine the a factual foundation for the
15 U.S.C. § 16(e)(1)(A) & (B). In effectiveness of antitrust enforcement by government’s decisions such that its
considering these statutory factors, the consent decree. conclusions regarding the proposed
court’s inquiry is necessarily a limited settlements are reasonable); InBev, 2009
Bechtel, 648 F.2d at 666 (emphasis
one as the government is entitled to U.S. Dist. LEXIS 84787, at *20 (‘‘the
added) (citations omitted).1
‘‘broad discretion to settle with the ‘public interest’ is not to be measured by
In determining whether a proposed
defendant within the reaches of the comparing the violations alleged in the
settlement is in the public interest, a
public interest.’’ United States v. complaint against those the court
district court ‘‘must accord deference to
Microsoft Corp., 56 F.3d 1448, 1461 believes could have, or even should
the government’s predictions about the
(D.C. Cir. 1995); see generally United have, been alleged.’’). Because the
efficacy of its remedies, and may not
States v. SBC Commc’ns, Inc., 489 F. ‘‘court’s authority to review the decree
require that the remedies perfectly
Supp. 2d 1 (D.D.C. 2007) (assessing depends entirely on the government’s
match the alleged violations.’’ SBC
public interest standard under the exercising its prosecutorial discretion by
Commc’ns, 489 F. Supp. 2d at 17; see
Tunney Act); United States v. Hillsdale bringing a case in the first place,’’ it
also United States v. U.S. Airways
Cmty. Health Ctr., 2015 U.S. Dist. LEXIS follows that ‘‘the court is only
Group, Inc., 38 F. Supp. 3d 69, 74
162505, at *3 (E.D. Mich. 2015) authorized to review the decree itself,’’
(D.D.C. 2014) (noting that a court should
(explaining that the ‘‘Court’s review is and not to ‘‘effectively redraft the
amozie on DSK3GDR082PROD with NOTICES2
limited’’ in Tunney Act settlements); 1 See also BNS, 858 F.2d at 464 (holding that the complaint’’ to inquire into other matters
United States v. InBev N.V./S.A., No. court’s ‘‘ultimate authority under the [APPA] is that the United States did not pursue.
08–1965 (JR), 2009 U.S. Dist. LEXIS limited to approving or disapproving the consent Microsoft, 56 F.3d at 1459–60; see also
84787, at *3 (D.D.C. Aug. 11, 2009) decree’’); United States v. Gillette Co., 406 F. Supp. Dairy Farmers, 2007 U.S. Dist. LEXIS
713, 716 (D. Mass. 1975) (noting that, in this way,
(noting that the court’s review of a the court is constrained to ‘‘look at the overall
33230 at *3 (citing Microsoft favorably).
consent judgment is limited and only picture not hypercritically, nor with a microscope, As the United States District Court for
inquires ‘‘into whether the government’s but with an artist’s reducing glass’’). the District of Columbia confirmed in
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![Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices 60327
SBC Communications, courts ‘‘cannot Congress intended when it first enacted interest can be meaningfully evaluated
look beyond the complaint in making the Tunney Act in 1974. As Senator simply on the basis of briefs and oral
the public interest determination unless Tunney explained: ‘‘[t]he court is arguments, that is the approach that
the complaint is drafted so narrowly as nowhere compelled to go to trial or to should be utilized.’’).
to make a mockery of judicial power.’’ engage in extended proceedings which
VIII. DETERMINATIVE DOCUMENTS
SBC Commc’ns, 489 F. Supp. 2d at 15. might have the effect of vitiating the
In its 2004 amendments,2 Congress benefits of prompt and less costly There are no determinative materials
made clear its intent to preserve the settlement through the consent decree or documents within the meaning of the
practical benefits of utilizing consent process.’’ 119 Cong. Rec. 24,598 (1973) APPA that were considered by the
decrees in antitrust enforcement, adding (statement of Sen. Tunney). Rather, the United States in formulating the
the unambiguous instruction that procedure for the public interest proposed Final Judgment.
‘‘[n]othing in this section shall be determination is left to the discretion of Dated: November 14, 2018
construed to require the court to the court, with the recognition that the
conduct an evidentiary hearing or to Respectfully submitted,
court’s ‘‘scope of review remains
require the court to permit anyone to Benjamin C. Glassman,
sharply proscribed by precedent and the United States Attorney
intervene.’’ 15 U.S.C. § 16(e)(2); see also nature of Tunney Act proceedings.’’
U.S. Airways, 38 F. Supp. 3d at 76 lllllllllllllllllllll
SBC Commc’ns, 489 F. Supp. 2d at 11. Andrew M. Malek (Ohio Bar #0061442)
(indicating that a court is not required A court can make its public interest
to hold an evidentiary hearing or to Assistant United States Attorney, 303
determination based on the competitive Marconi Boulevard, Suite 200, Columbus,
permit intervenors as part of its review impact statement and response to public
under the Tunney Act). This language Ohio 43215, Tel: (614) 469–5715, Fax: (614)
comments alone. U.S. Airways, 38 F. 469–2769, E-mail: Andrew.Malek@usdoj.gov
explicitly wrote into the statute what Supp. 3d at 76. See also United States lllllllllllllllllllll
2 The 2004 amendments substituted ‘‘shall’’ for
v. Enova Corp., 107 F. Supp. 2d 10, 17 J. Richard Doidge,
‘‘may’’ in directing relevant factors for a court to
(D.D.C. 2000) (noting that the ‘‘Tunney Attorney, U.S. Department of Justice,
consider and amended the list of factors to focus on Act expressly allows the court to make Antitrust Division, 450 5th Street NW, Suite
competitive considerations and to address its public interest determination on the 8000, Washington, DC 20530, Tel: (202) 514–
potentially ambiguous judgment terms. Compare 15 basis of the competitive impact 8944, Fax: (202) 616–2441, E-mail:
U.S.C. § 16(e) (2004), with 15 U.S.C. § 16(e)(1) Dick.Doidge@usdoj.gov
(2006); see also SBC Commc’ns, 489 F. Supp. 2d at
statement and response to comments
11 (concluding that the 2004 amendments ‘‘effected alone’’); S. Rep. No. 93–298 93d Cong., [FR Doc. 2018–25461 Filed 11–21–18; 8:45 am]
minimal changes’’ to Tunney Act review). 1st Sess., at 6 (1973) (‘‘Where the public BILLING CODE 4410–11–P
amozie on DSK3GDR082PROD with NOTICES2
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Document Created: 2018-11-27 12:58:44
Document Modified: 2018-11-27 12:58:44
| Category | Regulatory Information | |
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