When federal prosecutors lose a case, and especially when they lose a series of related cases, the responsible reaction is to look back, reflect on what went wrong, and consider whether a different approach might be appropriate. But the head prosecutor at the antitrust division of the Department of Justice is turning that maxim on its head.

In recent years, the division has embarked upon an aggressive and novel series of criminal prosecutions in the labor market space, involving alleged agreements to restrict job opportunities. This effort has been profoundly unsuccessful. Since last year, the antitrust division has now gone to trial with four cases in this space and lost all four at trial.

In fact, the government has lost the charged antitrust conduct in every single case it has brought to trial in this area, notwithstanding the millions of dollars of effort and tens of thousands of hours devoted to these prosecutions. In each case, either the jury (if the case got that far) or the judge resoundingly rejected the government’s effort to treat the alleged antitrust conduct as criminal. 

To lose this many cases in a row without a victory is exceptionally rare. According to a 2019 Pew Research Center report, 80 percent of federal criminal defendants are ultimately convicted at trial.

How has the Department reacted to this unbroken string of trial defeats? Not well, if the words of Assistant Attorney General Jonathan Kanter, who runs the antitrust division, mean anything.  He recently told people in his office to “pump up Tom Petty’s ‘I won’t back down,’ turn it up, put it on repeat, dance like nobody’s watching, and sing out loud over and over and over again.  We are not backing down.” This reflects an unwillingness to take into account the uniform reactions of both juries and judges.

In contrast with this seemingly oblivious attitude, others within the division have suggested a more reasonable approach, stating that they intend to learn from the results to date, while continuing to pursue prosecutions in the labor market space. 

How did we get to this place where the DOJ is trying to criminalize this conduct for the first time in the nation’s history? Traditionally, crimes are defined by Congress. Congress passes a statute, and the courts define the outer boundaries of that conduct, laying out guidelines between what is criminal and what is not. 

No such process has ever occurred in this area of the law. The last time Congress spoke to the issue of the conduct covered by the antitrust laws was in the Sherman Act, enacted more than 130 years ago. But it was not until 2016 that the Department of Justice, in what it called its “Antitrust Guidance for Human Resource Professionals,” declared that attempts to affect the labor market through non-compete or non-solicitation agreements should be deemed criminal. 

No statute ever said that. No court ever said that. It was just an administrative decree by the Justice Department and the Federal Trade Commission.

And the Justice Department was not content merely to define this conduct as criminal. It went further, declaring that allegations of labor misconduct that touch on non-competes or non-solicitation agreements should be adjudicated under what is known as the “per se” standard, the most draconian standard that exists in criminal law. Under this standard, merely entering into a no-poach agreement with a competitor makes a person criminally liable, even if the agreement had no impact on the labor market whatsoever. 

In fact, when this standard is imposed, any evidence of surrounding circumstances or justifications — including harm, purpose, lack of a criminal mindset, or absence of any economic impact — is deemed legally irrelevant and inadmissible. And while there are very limited categories of conduct, such as price-fixing and bid-rigging, that courts have deemed eligible for this type of draconian rule, no court has ever said that this labor-related conduct is, in the words of the Supreme Court, “so manifestly anticompetitive and lacking any redeeming value” that this ultra-rigorous standard should be applied to standard business clauses such as non-competes and non-solicitation agreements.

The current antitrust enforcement tone is unlike anything we have ever seen. Rhetoric and references to Tom Petty — not to court decisions or congressionally-enacted statutes — are driving decisions to shift or ignore existing legal boundaries and to charge certain conduct in the labor markets as a crime. The Supreme Court, in U.S. v. Topco Associates, Inc., warned of the need for caution and deliberation when it stated that “it is only after considerable experience with certain business relationships that courts classify them as per se violations.”

So why does this matter?  Well, for the individuals who bear the brunt of this enforcement approach, it is unfair and brings with it enormous cost and fear. Going through a federal criminal trial, particularly one in which the government seeks to tie your hands about what kind of defense evidence you are even allowed to present to a jury, is a life-altering experience. And although every defendant and company that has run this trial gauntlet to date has prevailed, they are saddled with the life-long consequences of being charged with a federal crime, even if ultimately exonerated. For many individuals, the damage is done once charges are publicly filed — one can never unring that bell, even if found not guilty. 

The Justice Department cannot ignore this damning, unbroken string of trial losses. Reasonable minds and leaders must hit the pause button on treating alleged non-solicitation agreements as crimes under a standard that neither Congress nor any court has ever prescribed. They should recognize that their current approach is fundamentally flawed – the responses of each judge and jury to consider the labor market prosecutions demonstrate this – and reassess and change their approach. 

Instead of taking his guidance from Tom Petty, Kanter should take to heart the Supreme Court’s admonition in Berger v. U.S.: that the prosecutor “may strike hard blows, [but] he is not at liberty to strike foul ones.” 

Jeffrey E. Stone and Justin P. Murphy are partners at the international law firm McDermott Will & Emery. Both previously served as federal prosecutors for the U. S. Department of Justice.