UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 08-60198-CR-HURLEY/VITUNAC
15 U.S.C. § 1
UNITED STATES OF AMERICA,
v.
MANULI RUBBER INDUSTRIES, S.p.A.,
Defendant.
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FILED IN OPEN COURT
KZ OCT 21 2008
STEVEN M. LARIMORE
CLERK U.S. DISTRICT COURT
S.D. OF FLA - W.R.B.
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PLEA AGREEMENT
The United States of America and Manuli Rubber Industries, S.p.A. ("defendant" or
"Manuli"), a corporation organized and existing under the laws of Italy, 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:
- to be represented by an attorney;
- to be charged by Indictment;
- as a corporation organized and existing under the laws of Italy, to decline
to accept service of the Summons in this case, and to contest the jurisdiction of the United
States to prosecute this case against it in the United States District Court for the Southern
District of Florida;
- to plead not guilty to any criminal charge brought against it;
- 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;
- to confront and cross-examine witnesses against it and to subpoena
witnesses in its defense at trial;
- to appeal its conviction if it is found guilty; and
- to appeal the imposition of sentence against it.
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 Southern District of Florida. 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)-(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 [which] is filed in the United States District Court
for the Southern District of Florida. The Information will charge[s] the defendant with participating in a conspiracy to suppress and eliminate competition by rigging bids, fixing prices and allocating
market shares for sales of marine hose sold in the United States and elsewhere, beginning at least as early as 2000 and continuing until as late as May 2, 2007 in unreasonable restraint of foreign
and interstate trade and commerce 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 [the government] will state the factual basis for the plea 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:
- For purposes of this Plea Agreement, the "relevant period" is that period beginning
at least as early as 1999 and continuing until as late as May 2, 2007. During the relevant period,
the defendant was a corporation organized and existing under the laws of Italy. The defendant has
its principal place of business in Milan, Italy. During the relevant period, the defendant
manufactured marine hose in Italy, and sold marine hose in the United States and elsewhere.
Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities
and/or buoys.
- During the relevant period, co-conspirators of the defendant entered into and
engaged in a conspiracy, the primary purpose of which was to suppress and eliminate competition
by rigging bids, fixing prices and allocating market shares for sales of marine hose sold in the
United States and elsewhere. The defendant joined and participated in the existing conspiracy
from at least as early as 2000 until as late as May 2, 2007. Manuli agreed to join the conspiracy
with the understanding that it would receive a ten percent share of marine hose sales.
- In furtherance of the conspiracy, the defendant, through certain officers and
employees of a subsidiary and its Oil and Marine Division, engaged in discussions and attended
meetings with representatives of other marine hose manufacturers. During such meetings and
discussions, the co-conspirators agreed to rig bids, fix prices and allocate market shares for the
sale of marine hose in the United States and elsewhere. Each of the conspiring manufacturers
provided a co-conspirator, who acted as a coordinator, with information about upcoming marine
hose jobs. The coordinator then designated, based on rules agreed to by the conspirators, which of
the conspiring manufacturers would win the job, referring to the winning conspirator as "champion." After the champion had been designated, the coordinator provided the other
conspirators with instructions regarding how much to bid on the job to ensure that the designated
champion would win the job.
- During the relevant period, marine hose sold by one or more of the conspirator
firms, and equipment and supplies necessary to the production and distribution of marine hose, as
well as payments for marine hose, traveled in interstate and foreign commerce. The business
activities of the defendant and co-conspirators in connection with the manufacture and/or sale of
marine hose affected by this conspiracy were within the flow of, and substantially affected,
interstate and foreign trade and commerce.
- Acts in furtherance of this conspiracy were carried out within the Southern District
of Florida within the relevant period. The defendant has operations in Broward County. In
addition, on at least one occasion, members of the conspiracy, including representatives of the
defendant, attended a meeting in Monroe County during which the conspirators discussed the
implementation of the conspiracy. Both Broward and Monroe counties are within the Southern
District of Florida.
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:
- $100 million (15 U.S.C. § 1);
- twice the gross pecuniary gain the conspirators derived from the crime (18
U.S.C. § 3571(c) and (d)); or
- twice the gross pecuniary loss caused to the victims of the crime by the
conspirators (18 U.S.C. § 3571(c) and (d)).
6. In addition, the defendant understands that:
- 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;
- 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
- 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.
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 provides 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).
Pursuant to U.S.S.G. § 6B1.4, the United States and the defendant enter into the following
stipulations:
- The base fine for the offense to which the defendant is pleading guilty, as
established by U.S.S.G. § 2R1.1(d)(1), is $4.2 million.
- During the relevant period, the defendant's Oil and Marine Division had
more than 10, but fewer than 50, employees, and an individual within substantial authority
personnel participated in, condoned, or was willfully ignorant of the offense, within the
meaning of U.S.S.G. § 8C2.5(b)(5), which increases the defendant's U.S.S.G. § 8C2.5
culpability score by one point.
- The defendant has fully cooperated in the investigation and clearly
demonstrated recognition and affirmative acceptance of responsibility for its criminal
conduct, within the meaning of U.S.S.G. § 8C2.5(g)(2), which decreases the defendant's
U.S.S.G. § 8C2.5 culpability score by 2 points. However, should the United States obtain or receive additional evidence or information prior to sentencing that, in its sole discretion, it determines to be credible and materially in conflict with this stipulation, then the United States shall no longer be bound by this stipulation.
- Based on the foregoing, the defendant's U.S.S.G. § 8C2.5 culpability score is 4, which yields minimum and maximum fine multipliers, as determined in U.S.S.G. § 8C2.6, of 0.80 and 1.60. Therefore the defendant's appropriate Guidelines fine range is
$3.36 million to $6.72 million.
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 $2 million
payable in full before the fifteenth (15th) day after the date of judgment ("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.
- 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.
- Both parties will recommend that no term of probation be imposed, but the defendant understands that the Court's denial of this request will not void
this Plea Agreement.
- 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 10, 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), U.S.S.G. §6A1.1, and Rule 88.8, S.D. Fla. L.R. The Court's denial of the
request to impose sentence on an expedited schedule will not void this Plea Agreement.
9. 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. Subject to
the full and continuing cooperation of the defendant, as described in Paragraph 13 of this Plea
Agreement, and prior to sentencing in this case, the United States agrees that it will make a motion,
pursuant to U.S.S.G. § 8C4.1, for a downward departure from the Guidelines fine range and will
request that the Court impose the recommended sentence set out in Paragraph 8 of this Plea
Agreement because of the defendant's substantial assistance in the United States' investigation and
prosecutions of violations of federal criminal law in the marine hose industry.
10. Subject to the ongoing, full, and truthful cooperation of the defendant described in
Paragraph 13 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.
11. 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.
- If the Court does not accept the recommended sentence, the United States
and the defendant agree that this Plea Agreement, except for Paragraph 11(b) below, shall
be rendered void.
- 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 United States 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
15 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.
12. In light of the availability of civil causes of actions, 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
13. The defendant and its subsidiaries involved in the production or sale of marine
hose (collectively "related entities") 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 manufacture or sale of marine hose, any other
federal investigation resulting therefrom, 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 related entities shall include,
but not be limited to:
- producing to the United States all non-privileged documents, information,
and other materials wherever located, in the possession, custody, or control of the
defendant, requested by the United States in connection with any Federal Proceeding;
- using its best efforts to secure the ongoing, full, and truthful cooperation, as defined in Paragraph 14 of this Plea Agreement, of the current or former directors,
officers, and employees of the defendant or any of its related entities as may be requested
by the United States, but excluding Robert L. Furness, Charles J. Gillespie, Val M.
Northcutt and Francesco Scaglia , 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.
14. The ongoing, full, and truthful cooperation of each person described in Paragraph
13(b) above will be subject to the procedures and protections of this paragraph, and shall include,
but not be limited to:
- 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;
- 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;
- 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.);
- 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;
- 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
- agreeing that, if the agreement not to prosecute him or her in this Plea Agreement is rendered void under Paragraph 16(c), the statute of
limitations period for any Relevant Offense as defined in Paragraph 16(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.
UNITED STATES' AGREEMENT
15. 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
13 of this Plea Agreement, the United States agrees that it will not bring further criminal charges
against the defendant or any of its related entities for any act or offense committed before the date
of this Plea Agreement that was undertaken in furtherance of an antitrust conspiracy involving the
manufacture or sale of marine hose or undertaken in connection with any investigation of such a
conspiracy. 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.
16. The United States agrees to the following:
- 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 16(c), the United States will not bring criminal charges against any
current or former director, officer, or employee of the defendant or its related entities 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 related entities that was undertaken in furtherance of an antitrust conspiracy involving the manufacture or sale
of marine hose or undertaken in connection with any investigation of such a conspiracy
("Relevant Offense"), except that the protections granted in this paragraph shall not apply to Robert L. Furness, Charles J. Gillespie, Val M. Northcutt and Francesco Scaglia;
- Should the United States determine that any current or former director,
officer, or employee of the defendant or its related entities 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 [Manuli]) or, if the individual is not known
by the United States to be represented, to the undersigned counsel for the defendant [Manuli];
- If any person requested to provide cooperation under Paragraph 16(b) fails
to comply with his or her obligations under Paragraph 14, 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;
- Except as provided in Paragraph 16(e), information provided by a person
described in Paragraph 16(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.);
- 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 14 of this Plea
Agreement, the agreement in Paragraph 16(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;
- 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
- Documents provided under Paragraphs 13(a) and 14(a) shall be deemed
responsive to outstanding grand jury subpoenas issued to the defendant.
17. 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 pursuant to the terms of this
plea agreement in any Federal Proceeding.
18. 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
related entities as a matter for that agency to consider before determining what administrative
action, if any, to take.
REPRESENTATION BY COUNSEL
19. 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
20. 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
21. 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 related entities
has failed to provide full and truthful cooperation, as described in Paragraph 13 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
related entities 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 related entities 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 related entities for any offense referred to in Paragraph 15 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.
22. The defendant understands and agrees that in any further prosecution of it or its related entities resulting from the release of the United States from its obligations under
this Plea Agreement, because of the defendant's or its related entities' violation of the Plea
Agreement, any documents, statements, information, testimony, or evidence provided by it, its
related entities, or current or former directors, officers, or employees of it or its related entities 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 related entities 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
23. 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.
24. 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.
25. 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.
26. 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: July 22, 2008
BY:_______________/s/________________
Luca Coccioli
Group Legal General Counsel
Manuli Rubber Industries, S.p.A.
Piazza della Repubblica, 14/16
20124 Milan, Italy
BY:_______________/s/________________
Robert M. Osgood
Sullivan & Cromwell
1 New Fetter Lane
London, England EC4 1AN
Counsel for Manuli Rubber Industries, S.p.A.
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BY:_______________/s/________________
J. Brady Dugan
Craig Y. Lee
Portia R. Brown
Jon B. Jacobs
Attorneys, Antitrust Division
U.S. Department of Justice
National Criminal Enforcement Section
450 5th Street, NW, Suite 11300
Washington, DC 20530
202-514-1953
Counsel for the United States
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