UAW employees of FCA were not directly and proximately harmed by a conspiracy engaged in by the automobile maker to violate the LMRA as a result of a bribery scheme targeting officers and employees of the union.
In a criminal case involving the federal government’s prosecution of Fiat Chrysler Automobiles (FCA) pursuant to an alleged conspiracy to violate the LMRA by paying money and things of value to officers and employees of the United Auto Workers Union, a motion for recognition of crime victim status and for restitution filed by civil plaintiffs, UAW employees of FCA, was denied by a federal district court in Michigan. Observing that a FCA plea agreement clearly stated that there was to be no restitution in this matter, the court concluded that the civil plaintiffs were not crime victims entitled to restitution as those terms are defined in the CVRA and MVRA (United States v. FCA US LLC, July 19, 2021, Borman, P.).
Civil plaintiffs. Civil plaintiffs, UAW employees of FCA, were 234 individuals who had brought civil suits against FCA as a result of a bribery scheme to secure favorable treatment for the automobile maker from the union. They contend that they have a right to be designated “crime victims” and “victims” in this criminal case, “as those terms are defined in the Crime Victims’ Rights Act (CRVA), 18 U.S.C. § 3771(c)(2)(A), and the Mandatory Victims Restitution Act (MVRA), 18 U.S.C. § 3663A(a)(2),” and to receive victim restitution from FCA.
On March 1, 2021, a representative of FCA appeared in a court hearing and admitted that the company had conspired with other entities and individuals to violate the LMRA by making more than $3.5 million in illegal payments to officers of the UAW during the period 2009 through 2016.
Proximate harm. In this action, FCA opposed the plaintiffs’ motion, contending that they were not directly and proximately harmed by the offense of conviction. Further, FCA contended that the court should also deny restitution under the MVRA because computing the hundreds of victims purported losses would require “complex” and speculative inquiries that would “complicate or prolong the sentencing process.” Moreover, FCA noted that since the plea agreement reflected that no restitution should be imposed as part of its sentence, the civil plaintiffs conceded that they seek restitution for harm based on conduct that is not alleged in the information or admitted to in the plea agreement.
Additionally, FCA noted that in dismissing the complaint in General Motors LLC v. FCA US LLC, the court did not make any factual findings that the direct victims of the defendants’ alleged bribery scheme were FCA UAW employees; but rather, observed under GM’s theory of the case as pleaded, the only people who could be characterized as victims were FCA’s workers, and not GM.
The government concurred with FCA’s interpretation of the language of the court’s opinion in General Motors v. FCA, that if there were any victims in that case, they would be FCA’s UAW workers, not GM’s. The government also pointed to the MVRA provision that applied to this case: that determining restitution issues of fact as to all of civil plaintiffs’ losses “would complicate or prolong the sentencing process to a degree that the need to provide restitution to any victim is outweighed by its burden on the sentencing process,” 18 U.S.C. § 3663(A)(c)(3)(B).
Plea agreement. FCA’s guilty plea pursuant to a Federal Rule of Criminal Procedure 11(c)(1)(C) plea agreement (Rule 11) contained a provision binding the court to the sentencing provisions contained in the plea agreement. The significant Rule 11 provision with regard to the instant proceedings was: “The parties agree that there is no restitution in this matter.”
Here, the court concluded that it did not hold in General Motors v. FCA that FCA’s UAW employees were victims of the RICO scheme discussed in that case. As a consequence, it concluded that the civil plaintiffs were not directly and proximately harmed by the specific offense of conviction. Additionally, the court concluded that the civil plaintiffs were not crime victims entitled to restitution as those terms are defined in the CVRA and MVRA. Further, the court recognized that the plea agreement clearly stated that there was to be no restitution in this matter.
Accordingly, the court accepted the Rule 11 plea agreement and denied the civil plaintiffs’ motion for recognition of crime victim status and for restitution.
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