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Redress facilitation orders as a sanction against corporations

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Brent Fisse
Brent Fisse Lawyers

The possibility of redress facilitation orders is discussed briefly in Fisse, ‘Cartel Offences and Non-Monetary Punishment: The Punitive Injunction as a Sanction against Corporations’ in C Beaton-Wells and A Ezrachi (eds), Criminalising Cartels: Critical Studies of an International Regulatory Movement, Hart Publishing, Oxford, 2011, ch 14. This paper for the symposium in honour of Laura Guttuso develops that idea into a fully-fledged model. The topic and the approach adopted reflects Laura’s thesis that the civil and criminal enforcement of anti-cartel laws should be integrated.

The punishment of cartel conduct and the redress of cartel conduct typically have been handled in different proceedings. Little attempt has been made to bring both into alignment or convergence. One underlying assumption seems to be that punishment is a negative or deadweight form of social control and that the more positive aim of compensating victims is best achieved in proceedings dedicated to that objective. However, that assumption fails to recognise the potential use of punishment as a means of assisting the provision of compensation in separate proceedings. The punitive injunction could well be used as a criminal sanction or civil penalty to require a corporate offender to facilitate the recovery of damages by the victims of cartel conduct.

Worked examples are given to show how the model would apply and how foreseeable possible concerns should be addressed.

The settlement agreement between class action plaintiffs and Lufthansa and Swiss International Air Lines in the US in the wake of air cargo price fixing[1] is one instructive example. The agreement sets out cooperation obligations, including an obligation to produce relevant documents and to make directors, officers and employees available to give evidence.[2] These cooperation obligations are comprehensive and detailed. They provide a useful starting point for the drafting of redress facilitation obligations in a punitive injunctive order.

The model and the approach proposed focus on cartel conduct but are relevant more generally to civil and criminal corporate sanctions.

[1]      In re Air Cargo Shipping Services Antitrust Litigation, ‘Settlement Agreement between Air Cargo Plaintiffs and Defendants Deutsche Lufthansa AG, Lufthansa Cargo AG, and Swiss International Air Lines Ltd’, Master File 06-MD-1775 (CBA)(VVP), 2006, US District Court, Eastern District of New York, www.aircargosettlement.com.

[2]      See Section J of the agreement.