Six Aerospace Executives, Managers Indicted In “No-Poach” Conspiracy
Kehoe Law Firm, P.C. Is Investigating Whether Engineers Or Other Skilled Employees Of Various Aerospace Companies Were Harmed By Anticompetitive Hiring Practices, Including Aerospace Engineering Companies Pratt & Whitney; QuEST Global Services-NA, Inc.; Belcan Engineering Group, LLC; Belcan Engineering Group Limited Partnership; Cyient Inc. (Formerly InfoTech); Parametric Solutions, Inc.; & Agilis Engineering, Inc.
If You Were Employed As An Engineer Or Other Skilled Employee At Any Time From 2011 To September 2019 At Pratt & Whitney; QuEST Global Services-NA, Inc.; Belcan Engineering Group, LLC; Cyient Inc. (Previously InfoTech); Parametric Solutions, Inc.; Agilis Engineering, Inc., Or One Of Their Wholly-Owned Subsidiaries, You Are Encouraged To Contact Kehoe Law Firm, P.C. , John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected], [email protected], To Discuss The Firm’s Aerospace Antitrust Investigation Or Potential Legal Claims.
Six Aerospace Executives and Managers Indicted For Leading Roles In Labor Market Conspiracy That Limited Workers’ Mobility And Career Prospects
On December 16, 2021, the U.S. Department of Justice announced that a federal grand jury in Bridgeport, Connecticut, returned an indictment charging a former manager of a major aerospace engineering company and five executives of outsource engineering suppliers (“Suppliers”) for participating in a long-running conspiracy to restrict the hiring and recruiting of employees among their respective companies. The conspiracy affected thousands of engineers and other skilled workers in the aerospace industry who perform services in the design, manufacturing and servicing of aircraft components for both commercial and military purposes.
According to the one-count felony indictment unsealed today in the United States District Court for the District of Connecticut, six individuals — Mahesh Patel (“Patel”), of Connecticut; Robert Harvey, of South Carolina; Harpreet Wasan, of Connecticut; Steven Houghtaling, of Connecticut; Tom Edwards, of Connecticut; and Gary Prus, of Florida — conspired with unnamed others to allocate employees by agreeing not to hire or solicit employees from each other’s companies.
This indictment is the first in an ongoing investigation into labor market allocation in the aerospace engineering services industry. Patel, described as a leader of the conspiracy given his position and authority as the Suppliers’ common customer, was previously charged by complaint. He was arrested and appeared before a federal magistrate judge on the charge last week, and was released on a $100,000 appearance bond. The remaining defendants are expected to appear before federal district courts in different districts this week.
According to the indictment, the defendants and co-conspirators recognized the mutual financial benefit of the conspiracy — namely, reducing the rise in labor costs that would occur when aerospace workers were free to find new employment in a competitive environment. Patel and certain other co-conspirators explicitly appealed to this financial benefit when communicating with each other about the agreement.
The maximum penalty under the Sherman Act for a conspiracy to restrain trade is 10 years of imprisonment and a fine of $1 million. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fine.
Aerospace “No-Poach” Antitrust Class Action Lawsuit
On December 14, 2021, a class action complaint was filed in United States District Court for the District of Connecticut on behalf of engineers and other similarly skilled employees, based on alleged unlawful “no-poach” agreements among the aerospace engineering firms, which was intended to restrain competition in the relevant labor markets.
The Defendant aerospace-related companies named in the class action lawsuit (i.e., Pratt & Whitney; QuEST Global Services-NA, Inc.; Belcan Engineering Group, LLC; Belcan Engineering Group Limited Partnership; Cyient Inc.; Parametric Solutions, Inc.; Agilis Engineering, Inc.) are major competitors for engineering services, and they compete with one another to attract, hire, and retain engineers and other skilled employees.
According to the complaint, beginning at least as early as 2011 and continuing through at least 2019, senior executives and managers at the Defendant companies entered into a conspiracy not to solicit, recruit, hire without prior approval, or otherwise compete for employees, including engineers and other skilled employees.
Allegedly, the Defendant companies agreed to restrict competition for their employees’ services with the purpose and effect of fixing, suppressing, and stabilizing wages, salaries, and benefits and restraining competition in the market for their employees’ services. Further, the Defendants’ agreement to fix, suppress, and stabilize wages, salaries and benefits also, according to the complaint, restricted their employees’ mobility to access better job opportunities.
To view a copy of the antitrust class action complaint, please click Aerospace Engineering Class Action Complaint.