| UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
| FILED
MAY 7, 2008
NANCY MAYER WHITTINGTON, CLERK
U.S. DISTRICT COURT |
UNITED STATES OF AMERICA,
v.
JAPAN AIRLINES INTERNATIONAL
CO., LTD.,
Defendant.
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Criminal No. 08-00106 (JDB)
Filed: May 7, 2008
Violation: 15 U.S.C. §1 (Sherman Act)
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PLEA AGREEMENT
The United States of America and Japan Airlines International Co., Ltd. ("defendant"), a
corporation organized and existing under the laws of Japan, hereby enter into the following Plea
Agreement pursuant to Rule 11(c)(1)(C) of the Federal Rules of Criminal Procedure ("Fed. R.
Crim. P."):
RIGHTS OF DEFENDANT
1. The defendant understands its rights:
(a) | to be represented by an attorney;
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(b) | to be charged by Indictment;
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(c) | as a corporation organized and existing under the laws of Japan, to decline
to accept service of the Summons in this case, and to contest venue and the jurisdiction of
the United States to prosecute this case against it in the United States District Court for
the District of Columbia;
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(d) | to plead not guilty to any criminal charge brought against it;
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(e) | to have a trial by jury, at which it would be presumed not guilty of the charge and the United States would have to prove every essential element of the charged
offense beyond a reasonable doubt for it to be found guilty;
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(f) | to confront and cross-examine witnesses against it and to subpoena
witnesses in its defense at trial;
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(g) | to appeal its conviction if it is found guilty; and
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(h) | to appeal the imposition of sentence against it.
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AGREEMENT TO PLEAD GUILTY
AND WAIVE CERTAIN RIGHTS
2. The defendant knowingly and voluntarily waives the rights set out in Paragraph
1(b)-(g) above, including all jurisdictional defenses to the prosecution of this case, and agrees
voluntarily to consent to the jurisdiction of the United States to prosecute this case against it in
the United States District Court for the District of Columbia. The defendant also knowingly and
voluntarily waives the right to file any appeal, any collateral attack, or any other writ or motion,
including but not limited to an appeal under 18 U.S.C. § 3742, that challenges the sentence
imposed by the Court if that sentence is consistent with or below the recommended sentence in
Paragraph 8 of this Plea Agreement, regardless of how the sentence is determined by the Court.
This agreement does not affect the rights or obligations of the United States as set forth in 18
U.S.C. § 3742(b) and (c). Pursuant to Fed. R. Crim. P. 7(b), the defendant will waive indictment
and plead guilty at arraignment to a one-count Information to be filed in the United States
District Court for the District of Columbia. The Information will charge the defendant with
participating in a combination and conspiracy to suppress and eliminate competition by fixing the
cargo rates charged to customers in the United States and elsewhere for international air
shipments, from on or about April 1, 2000 until at least February 14, 2006, in violation of the
Sherman Antitrust Act, 15 U.S.C. § 1.
3. The defendant, pursuant to the terms of this Plea Agreement, will plead guilty to
the criminal charge described in Paragraph 2 above and will make a factual admission of guilt to
the Court in accordance with Fed. R. Crim. P. 11, as set forth in Paragraph 4 below.
FACTUAL BASIS FOR OFFENSE CHARGED
4. Had this case gone to trial, the United States would have presented evidence sufficient to prove the following facts against defendant:
(a) | For purposes of this Plea Agreement, the "relevant period" is that period
from on or about April 1, 2000 until at least February 14, 2006. During the relevant period, the
defendant was a corporation organized and existing under the laws of Japan and had its principal
place of business in Tokyo, Japan. During the relevant period, the defendant provided
international air transportation for cargo on certain trans-Pacific routes to and from the United
States ("air cargo services") and employed more than 1,000 individuals. For its air cargo
services, the defendant charged its customers a price that consisted of a base rate and, at times
during the relevant period, various surcharges and fees, such as a fuel surcharge and a security
surcharge. The base rate, surcharges, and fees charged by the defendant to customers for air
cargo services are collectively referred to herein as the "cargo rate." During the relevant period,
the defendant's sales of air cargo services from the United States totaled at least $665.1 million.
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(b) | During the relevant period, the defendant, through its officers and employees,
including high-level personnel of the defendant, participated in a conspiracy with one or more
providers of air cargo services, a primary purpose of which was to suppress and eliminate
competition by fixing one or more components of the cargo rates charged to customers for
certain U.S./trans-Pacific air cargo services. In furtherance of the conspiracy, the defendant,
through its officers and employees, engaged in discussions and attended meetings with
representatives of one or more providers of air cargo services. During these discussions and
meetings, agreements were reached to fix one or more components of the cargo rates to be
charged to purchasers of certain U.S./trans-Pacific air cargo services.
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(c) | During the relevant period, certain air cargo shipments provided by one or more of
the conspirator carriers, and aircraft necessary to transport the air cargo shipments, as well as
payments for the air cargo shipments, traveled in interstate and foreign commerce. Certain of the
business activities of the defendant and its co-conspirators in connection with the sale and
provision of U.S./trans-Pacific air cargo services affected by this conspiracy were within the flow
of, and substantially affected, interstate and foreign trade and commerce.
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POSSIBLE MAXIMUM SENTENCE
5. The defendant understands that the statutory maximum penalty which may be
imposed against it upon conviction for a violation of Section One of the Sherman Antitrust Act is
a fine in an amount equal to the greatest of:
(a) | $100 million (15 U.S.C. § 1);
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(b) | twice the gross pecuniary gain the conspirators derived from the crime (18
U.S.C. § 3571(c) and (d)); or
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(c) | twice the gross pecuniary loss caused to the victims of the crime by the
conspirators (18 U.S.C. § 3571(c) and (d)).
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6. In addition, the defendant understands that:
(a) | pursuant to 18 U.S.C. § 3561(c)(1), the Court may impose a term of
probation of at least one year, but not more than five years;
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(b) | pursuant to §8B1.1 of the United States Sentencing Guidelines
("U.S.S.G.," "Sentencing Guidelines," or "Guidelines") or 18 U.S.C. § 3563(b)(2) or
3663(a)(3), the Court may order it to pay restitution to the victims of the offense; and
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(c) | pursuant to 18 U.S.C. § 3013(a)(2)(B), the Court is required to order the
defendant to pay a $400 special assessment upon conviction for the charged crime.
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SENTENCING GUIDELINES
7. The defendant understands that the Sentencing Guidelines are advisory, not
mandatory, but that the Court must consider the Guidelines in effect on the day of sentencing,
along with the other factors set forth in 18 U.S.C. § 3553(a), in determining and imposing
sentence. The defendant understands that the Guidelines determinations will be made by the
Court by a preponderance of the evidence standard. The defendant understands that although the
Court is not ultimately bound to impose a sentence within the applicable Guidelines range, its
sentence must be reasonable based upon consideration of all relevant sentencing factors set forth
in 18 U.S.C. § 3553(a). Pursuant to U.S.S.G. §1B1.8, the United States agrees that
self-incriminating information that the defendant and their cooperating officers and employees
provide to the United States pursuant to this Plea Agreement will not be used to increase the
volume of affected commerce attributable to the defendant or in determining the defendant's
applicable Guidelines range, except to the extent provided in U.S.S.G. §1B1.8(b).
SENTENCING AGREEMENT
8. Pursuant to Fed. R. Crim. P. 11(c)(1)(C), the United States and the defendant
agree that the appropriate disposition of this case is, and agree to recommend jointly that the
Court impose, a sentence requiring the defendant to pay to the United States a criminal fine of
$110 million, pursuant to 18 U.S.C. § 3571(d), payable in installments as set forth below without
interest pursuant to 18 U.S.C. § 3612(f)(3)(A) ("the recommended sentence"). The parties agree
that there exists no aggravating or mitigating circumstance of a kind, or to a degree, not
adequately taken into consideration by the U.S. Sentencing Commission in formulating the
Sentencing Guidelines justifying a departure pursuant to U.S.S.G. §5K2.0. The parties agree not
to seek or support any sentence outside of the Guidelines range nor any Guidelines adjustment
for any reason that is not set forth in this Plea Agreement. The parties further agree that the
recommended sentence set forth in this Plea Agreement is reasonable.
(a) | The United States and the defendant agree that the applicable Guidelines
fine range exceeds the fine contained in the recommended sentence set out in Paragraph 8 above.
The United States agrees that, based on the defendant's ongoing cooperation, the United States
would have moved the Court for a downward departure pursuant to U.S.S.G. §8C4.1, but for the
fact that the amount of the fine that the United States would have recommended as a downward
departure for substantial assistance provided would have substantially jeopardized its continued
viability. The parties further agree that the recommended fine is appropriate, pursuant to
U.S.S.G. §8C3.3(a) and (b).
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(b) | The United States and the defendant agree to recommend, in the interest of
justice pursuant to 18 U.S.C. § 3572(d)(1) and U.S.S.G. §8C3.2(b), that the fine be paid in the
following installments: within thirty (30) days of imposition of sentence -- $20 million; at the
one-year anniversary of imposition of sentence ("anniversary") -- $20 million; at the two-year
anniversary -- $20 million; at the three-year anniversary -- $20 million; at the four-year
anniversary -- $20 million; and at the five-year anniversary -- $10 million; provided, however,
that the defendant shall have the option at any time before the five-year anniversary of prepaying
the remaining balance then owing on the fine.
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(c) | The defendant understands that the Court will order it to pay a $400
special assessment, pursuant to 18 U.S.C. § 3013(a)(2)(B), in addition to any fine imposed.
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(d) | The United States and the defendant jointly submit that this Plea
Agreement, together with the record that will be created by the United States and the defendant at
the plea and sentencing hearings, and the further disclosure described in Paragraph 9, will
provide sufficient information concerning the defendant, the crime charged in this case, and the
defendant's role in the crime to enable the meaningful exercise of sentencing authority by the
Court under 18 U.S.C. § 3553. The United States and defendant agree to request jointly that the
Court accept the defendant's guilty plea and impose sentence on an expedited schedule as early
as the date of arraignment, based upon the record provided by the defendant and the United
States, under the provisions of Fed. R. Crim. P. 32(c)(1)(A)(ii) and U.S.S.G. §6A1.1. The
Court's denial of the request to impose sentence on an expedited schedule will not void this Plea
Agreement.
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(e) | The United States contends that had this case gone to trial, the United
States would have presented evidence to prove that the gain derived from or the loss resulting
from the charged offense is sufficient to justify the recommended sentence set forth in this
paragraph, pursuant to 18 U.S.C. § 3571(d). For purposes of this plea and sentencing only, the
defendant waives its rights to contest this calculation.
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9. Subject to the ongoing, full, and truthful cooperation of the defendant described in
Paragraph 12 of this Plea Agreement, and before sentencing in the case, the United States will
fully advise the Court and the Probation Office of the fact, manner, and extent of the defendant's
cooperation and its commitment to prospective cooperation with the United States' investigation
and prosecutions, all material facts relating to the defendant's involvement in the charged
offense, and all other relevant conduct.
10. The United States and the defendant understand that the Court retains complete
discretion to accept or reject the recommended sentence provided for in Paragraph 8 of this Plea
Agreement.
(a) | If the Court does not accept the recommended sentence, the United States
and the defendant agree that this Plea Agreement, except for Paragraph 10(b) below, shall
be rendered void.
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(b) | If the Court does not accept the recommended sentence, the defendant will be free to withdraw its guilty plea (Fed. R. Crim. P. 11(c)(5) and (d)).
If the defendant withdraws its plea of guilty, this Plea Agreement, the guilty plea, and any
statement made in the course of any proceedings under Fed. R. Crim. P. 11 regarding the
guilty plea or this Plea Agreement or made in the course of plea discussions with an
attorney for the government shall not be admissible against the defendant in any criminal
or civil proceeding, except as otherwise provided in Fed. R. Evid. 410. In addition, the
defendant agrees that, if it withdraws its guilty plea pursuant to this subparagraph of the
Plea Agreement, the statute of limitations period for any offense referred to in Paragraph
14 of this Plea Agreement shall be tolled for the period between the date of the signing of
the Plea Agreement and the date the defendant withdrew its guilty plea or for a period of
sixty (60) days after the date of the signing of the Plea Agreement, whichever period is
greater.
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11. In light of pending civil class action lawsuits filed against the defendant, which
potentially provide for a recovery of a multiple of actual damages, the United States agrees that it
will not seek a restitution order for the offense charged in the Information.
DEFENDANT'S COOPERATION
12. The defendant and its subsidiaries will cooperate fully and truthfully with the
United States in the prosecution of this case, the conduct of the current federal investigation of
violations of federal antitrust and related criminal laws involving the sale of international air
cargo transportation services, and any litigation or other proceedings arising or resulting from any
such investigation to which the United States is a party ("Federal Proceeding"). The ongoing, full, and truthful cooperation of the defendant and its subsidiaries shall include, but not
be limited to:
(a) | producing to the United States all non-privileged documents, information,
and other materials (with translations into English), wherever located, in the possession,
custody, or control of the defendant or any of its subsidiaries, requested by the United
States in connection with any Federal Proceeding; and
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(b) | using its best efforts to secure the ongoing, full, and truthful cooperation, as defined in Paragraph 13 of this Plea Agreement, of the current and former
directors, officers, and employees of the defendant or any of its subsidiaries as may be
requested by the United States – but excluding Juntaro Shimizu, Yutaka Yoshino, and
Takao Fukuchi – including making these persons available in the United States and at
other mutually agreed-upon locations, at the defendant's expense, for interviews and the
provision of testimony in grand jury, trial, and other judicial proceedings in connection
with any Federal Proceeding.
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13. The ongoing, full, and truthful cooperation of each person described in Paragraph
12(b) above will be subject to the procedures and protections of this paragraph, and shall include,
but not be limited to:
(a) | producing in the United States and at other mutually agreed-upon locations
all non-privileged documents, including claimed personal documents, and other materials,
wherever located, requested by attorneys and agents of the United States in connection
with any Federal Proceeding;
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(b) | making himself or herself available for interviews in the United States and
at other mutually agreed-upon locations, not at the expense of the United States, upon the
request of attorneys and agents of the United States;
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(c) | responding fully and truthfully to all inquiries of the United States in
connection with any Federal Proceeding, without falsely implicating any person or
intentionally withholding any information, subject to the penalties of making false
statements (18 U.S.C. § 1001) and obstruction of justice (18 U.S.C. § 1503, et seq.);
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(d) | otherwise voluntarily providing the United States with any non-privileged
material or information not requested in (a) - (c) of this paragraph that he or she may have
that is related to any Federal Proceeding;
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(e) | when called upon to do so by the United States in connection with any
Federal Proceeding, testifying in grand jury, trial, and other judicial proceedings in the
United States fully, truthfully, and under oath, subject to the penalties of perjury (18
U.S.C. § 1621), making false statements or declarations in grand jury or court
proceedings (18 U.S.C. § 1623), contempt (18 U.S.C. §§ 401-402), and obstruction of
justice (18 U.S.C. § 1503, et seq.); and
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(f) | agreeing that, if the agreement not to prosecute him or her in this Plea Agreement is rendered void under Paragraph 15(c), the statute of
limitations period for any Relevant Offense as defined in Paragraph 15(a) shall be tolled
as to him or her for the period between the date of the signing of this Plea Agreement and
six (6) months after the date that the United States gave notice of its intent to void its
obligations to that person under the Plea Agreement.
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GOVERNMENT'S AGREEMENT
14. Upon acceptance of the guilty plea called for by this Plea Agreement and the
imposition of the recommended sentence, and subject to the cooperation requirements of
Paragraph 12 of this Plea Agreement, the United States agrees that it will not bring further
criminal charges against the defendant or any of its subsidiaries for any act or offense committed
before the date of this Plea Agreement that was undertaken in furtherance of an antitrust
conspiracy involving the sale of international air cargo transportation services. The
nonprosecution terms of this paragraph do not apply to civil matters of any kind, to any violation
of the federal tax or securities laws, or to any crime of violence.
15. The United States agrees to the following:
(a) | Upon the Court's acceptance of the guilty plea called for by this Plea
Agreement and the imposition of the recommended sentence and subject to the
exceptions noted in Paragraph 15(c), the United States will not bring criminal charges
against any current or former director, officer, or employee of the defendant or its
subsidiaries for any act or offense committed before the date of this Plea Agreement and
while that person was acting as a director, officer, or employee of the defendant or its
subsidiaries that was undertaken in furtherance of an antitrust conspiracy involving the
sale of international air cargo transportation services ("Relevant Offense"), except that the
protections granted in this paragraph shall not apply to Juntaro Shimizu, Yutaka Yoshino, and Takao Fukuchi;
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(b) | Should the United States determine that any current or former director,
officer, or employee of the defendant or its subsidiaries may have information relevant to
any Federal Proceeding, the United States may request that person's cooperation under
the terms of this Plea Agreement by written request delivered to counsel for the
individual (with a copy to the undersigned counsel for the defendant) or, if the individual
is not known by the United States to be represented, to the undersigned counsel for the
defendant;
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(c) | If any person requested to provide cooperation under Paragraph 15(b) fails
to comply with his or her obligations under Paragraph 13, then the terms of this Plea
Agreement as they pertain to that person, and the agreement not to prosecute that person
granted in this Plea Agreement, shall be rendered void;
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(d) | Except as provided in Paragraph 15(e), information provided by a person
described in Paragraph 15(b) to the United States under the terms of this Plea Agreement
pertaining to any Relevant Offense, or any information directly or indirectly derived from
that information, may not be used against that person in a criminal case, except in a
prosecution for perjury (18 U.S.C. § 1621), making a false statement or declaration
(18 U.S.C. §§ 1001, 1623), or obstruction of justice (18 U.S.C. § 1503, et seq.);
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(e) | If any person who provides information to the United States under this
Plea Agreement fails to comply fully with his or her obligations under Paragraph 13 of
this Plea Agreement, the agreement in Paragraph 15(d) not to use that information or any
information directly or indirectly derived from it against that person in a criminal case
shall be rendered void;
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(f) | The nonprosecution terms of this paragraph do not apply to civil matters of
any kind, to any violation of the federal tax or securities laws, or to any crime of violence;
and
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(g) | Documents provided under Paragraphs 12(a) and 13(a) shall be deemed
responsive to outstanding grand jury subpoenas issued to the defendant or any of its
subsidiaries.
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16. The United States agrees that when any person travels to the United States for
interviews, grand jury appearances, or court appearances pursuant to this Plea Agreement, or for
meetings with counsel in preparation therefor, the United States will take no action, based upon
any Relevant Offense, to subject such person to arrest, detention, or service of process, or to
prevent such person from departing the United States. This paragraph does not apply to an
individual's commission of perjury (18 U.S.C. § 1621), making false statements (18 U.S.C. §
1001), making false statements or declarations in grand jury or court proceedings (18 U.S.C. §
1623), obstruction of justice (18 U.S.C. § 1503, et seq.), or contempt (18 U.S.C. §§ 401-402) in
connection with any testimony or information provided or requested in any Federal Proceeding.
17. The defendant understands that it may be subject to administrative action by
federal or state agencies other than the United States Department of Justice, Antitrust Division,
based upon the conviction resulting from this Plea Agreement, and that this Plea Agreement in
no way controls whatever action, if any, other agencies may take. However, the United States
agrees that, if requested, it will advise the appropriate officials of any governmental agency
considering such administrative action of the fact, manner, and extent of the cooperation of the
defendant and its subsidiaries as a matter for that agency to consider before determining what
administrative action, if any, to take.
REPRESENTATION BY COUNSEL
18. The defendant has been represented by counsel and is fully satisfied that its
attorneys have provided competent legal representation. The defendant has thoroughly reviewed
this Plea Agreement and acknowledges that counsel has advised it of the nature of the charge,
any possible defenses to the charge, and the nature and range of possible sentences.
VOLUNTARY PLEA
19. The defendant's decision to enter into this Plea Agreement and to tender a plea of
guilty is freely and voluntarily made and is not the result of force, threats, assurances, promises,
or representations other than the representations contained in this Plea Agreement. The United
States has made no promises or representations to the defendant as to whether the Court will
accept or reject the recommendations contained within this Plea Agreement.
VIOLATION OF PLEA AGREEMENT
20. The defendant agrees that, should the United States determine in good faith,
during the period that any Federal Proceeding is pending, that the defendant or any of its
subsidiaries have failed to provide full and truthful cooperation, as described in Paragraph 12 of
this Plea Agreement, or has otherwise violated any provision of this Plea Agreement, the United
States will notify counsel for the defendant in writing by personal or overnight delivery or
facsimile transmission and may also notify counsel by telephone of its intention to void any of its
obligations under this Plea Agreement (except its obligations under this paragraph), and the
defendant and its subsidiaries shall be subject to prosecution for any federal crime of which the
United States has knowledge including, but not limited to, the substantive offenses relating to the
investigation resulting in this Plea Agreement. The defendant and its subsidiaries agree that, in
the event that the United States is released from its obligations under this Plea Agreement and
brings criminal charges against the defendant or its subsidiaries for any offense referred to in
Paragraph 14 of this Plea Agreement, the statute of limitations period for such offense shall be
tolled for the period between the date of the signing of this Plea Agreement and six (6) months
after the date the United States gave notice of its intent to void its obligations under this Plea
Agreement.
21. The defendant understands and agrees that in any further prosecution of it or its subsidiaries resulting from the release of the United States from its obligations under
this Plea Agreement, because of the defendant's or its subsidiaries' violation of the Plea
Agreement, any documents, statements, information, testimony, or evidence provided by it, its
subsidiaries, or current or former directors, officers, or employees of it or its subsidiaries to
attorneys or agents of the United States, federal grand juries, or courts, and any leads derived
therefrom, may be used against it or its subsidiaries in any such further prosecution. In addition,
the defendant unconditionally waives its right to challenge the use of such evidence in any such
further prosecution, notwithstanding the protections of Fed. R. Evid. 410.
ENTIRETY OF AGREEMENT
22. This Plea Agreement constitutes the entire agreement between the United States
and the defendant concerning the disposition of the criminal charge in this case. This Plea
Agreement cannot be modified except in writing, signed by the United States and the defendant.
23. The undersigned is authorized to enter this Plea Agreement on behalf of the
defendant as evidenced by the Resolution of the Board of Directors of the defendant attached to,
and incorporated by reference in, this Plea Agreement.
24. The undersigned attorneys for the United States have been authorized by the Attorney General of the United States to enter this Plea Agreement on behalf of the United
States.
25. A facsimile signature shall be deemed an original signature for the purpose of
executing this Plea Agreement. Multiple signature pages are authorized for the purpose of
executing this Plea Agreement.
DATED:4/16/2008
BY:_______________/s/________________
JAPAN AIRLINES INTERNATIONAL
CO., LTD.
By: Kazuhide Yamazaki
Its: Vice President of Legal Affairs
BY:_______________/s/________________
William Karas
Mark Hulkower
Kenneth P. Ewing
Erin S. Vagley
Steptoe & Johnson LLP
1330 Connecticut Avenue, N.W.
Washington, D.C. 20036
Tel.: (202) 429-3000
Fax: (202) 429-3902
Counsel for Japan Airlines International Co. Ltd.
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BY:_______________/s/________________
Mark R. Rosman, Assistant Chief
Brent Snyder, Trial Attorney
Mark C. Grundvig, Trial Attorney
Kathryn M. Hellings, Trial Attorney
Elizabeth Aloi, Trial Attorney
Deana Timberlake-Wiley, Trial Attorney
U.S. Department of Justice
Antitrust Division
1401 H Street, N.W.
Suite 3700
Washington, D.C. 20530
Tel.: (202) 616-3186
Fax: (202) 514-6525
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