Antitrust and Unfair Competition Law

Competition: Spring 2022, Vol 32, No. 1


Written by Laura K. Kaufmann1


Following decades of scarce antitrust enforcement in labor markets, the Department of Justice ("DOJ") and Federal Trade Commission ("FTC") have begun to turn their attention towards so-called "no-poach" agreements: agreements between competitors to not solicit or hire one another’s employees. With DOJ prosecuting its first four criminal no-poach cases against employers in 2021, and a recent federal court decision endorsing DOJ’s view that some no-poach agreements can constitute per se antitrust violations, more aggressive antitrust scrutiny in this area is likely.

In light of this trend, employers must take care to ensure that their conduct, particularly communications with competitors, cannot give rise to an enforcement action. This article surveys the recent focusing of the enforcement agencies’ attention on no-poach agreements and provides a set of recommendations for employers to minimize the risk that their employment practices may give rise to antitrust liability.


Labor, just like any other product or service, is bought and sold. There is no intrinsic reason why labor, and labor markets, cannot be the subject of price-fixing or other anticompetitive conduct. Recognizing this, economists and legal practitioners in recent years have spotlighted no-poach and wage-fixing agreements as an antitrust concern. Many have come to observe that low antitrust enforcement in labor markets has exacerbated the problem of stagnating wage growth and rising wealth inequality—particularly for low-wage workers.2 Labor market collusion and monopsony stand alongside several other potential culprits, including declining unionization, increasing automation, and outsourcing.

Several recent studies suggest that local labor markets tend to be highly concentrated, and that there is a correlation between high concentration and reduced wages.3 Some studies suggest that the use of no-poach agreements (particularly within franchises), wage-fixing agreements, and non-compete clauses in employment contracts for low-wage workers are the most visible manifestations of concentrated labor market power.4 This has led a growing chorus of economists, academics, and practitioners to criticize what they perceive as lackluster antitrust enforcement in labor markets, and to advocate for a more robust enforcement and regulatory regime.5

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In the past decade, DOJ and FTC have turned their attention to market power and collusion in labor markets as an antitrust problem. Antitrust enforcement in this area has historically been limited, as the agencies have tended to focus on product markets and have been reticent to tailor their approach to challenging market power and anticompetitive conduct in labor markets.6 Further, no-poach agreements have not commonly been recognized as one of the three types of anticompetitive conduct traditionally considered per se illegal—price-fixing, bid rigging, and market allocation—despite the fact that they essentially amount to buy-side market allocation.

Reflecting a newfound concern for anticompetitive conduct in labor markets, the agencies in the past few years have brought several civil actions against companies for their alleged use of no-poach agreements. In 2010, for instance, DOJ brought a series of cases against tech companies—Adobe, Apple, Google, Intel, Intuit, Pixar, and Lucasfilm—alleging no-poach agreements with respect to highly skilled employees.7 According to DOJ, alleged agreements between Apple and Google, Apple and Adobe, Apple and Pixar, and Google and Intel prevented the companies from directly soliciting each other’s employees, and an alleged agreement between Google and Intuit prevented Google from directly soliciting Intuit employees.8 Similarly, DOJ claimed that "Lucasfilm and Pixar agreed not to cold call each other’s employees; agreed to notify each other when making an offer to an employee of the other company; and agreed, when offering a position to the other company’s employee, not to counteroffer with compensation above the initial offer."9

DOJ reached settlements with each of these companies, under which the defendants agreed to refrain "from entering, maintaining, or enforcing any agreement that in any way prevents any person from soliciting, cold calling, recruiting, or otherwise competing for employees," and to implement compliance measures. DOJ’s complaints were followed by private class actions (and hefty settlements) for the same alleged conduct, underscoring that attracting the attention of government enforcers can also result in costly follow-on suits.10

Then in 2012, DOJ filed a civil antitrust lawsuit against eBay, alleging that the company had agreed with Intuit to not recruit or hire Intuit’s employees.11 DOJ alleged that Meg Whitman (then-CEO of eBay) and Scott Cook (Inuit’s founder and executive committee chair) were closely involved in forming, monitoring, and enforcing this no-poach agreement, and argued that the agreement eroded competition to the detriment of employees who likely were denied access to greater job opportunities and salaries.12 As part of a settlement agreement with DOJ, eBay agreed to pay $3.75 million in compensation to affected workers and to end its use of no-poach agreements.13

DOJ’s enforcement efforts in labor markets have not solely targeted employer collusion. In late 2021, DOJ challenged a proposed merger between the publishing companies Penguin and Simon & Schuster under Section 7 of the Clayton Act.14 In a press release, Attorney General Merrick Garland stated that "American authors and consumers will pay the price of this anticompetitive merger—lower advances for authors and ultimately fewer books and less variety for consumers."15 The agency’s complaint alleges that the merger "would likely result in substantial harm to authors of anticipated top-selling books"—essentially, workers—because the merged entity "would control close to half of the market for the acquisition of publishing rights to anticipated top-selling books," and the two largest publishers post-merger "would collectively control more than two-thirds of this market, leaving hundreds of authors with fewer alternatives and less leverage."16 DOJ further asserted that the merger would "reduc[e] author pay" and "make it harder for authors to earn a living by writing books."17

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State attorneys general are also active in this space. The Washington State Attorney General, for example, has made it a priority to end the use of no-poach agreements, particularly in the franchise context. Over the past few years, Washington’s Attorney General has signed hundreds of agreements with corporate chains to eliminate no-poach agreements from all of their franchise agreements.18 The Washington Attorney General’s Office is even more aggressive than DOJ when it comes to no-poach agreements, as the Office views no-poach agreements in the franchise context as per se illegal.19

In addition, DOJ has filed Statements of Interest in a number of civil cases to emphasize that DOJ views no-poach agreements as a form of illegal market allocation subject to per se treatment. In one of these Statements, DOJ wrote that "no-poach agreements among competing employers have almost identical anticompetitive effects to wage-fixing agreements: they enable the employers to avoid competing over wages and other terms of employment offered to the affected employees."20 DOJ further argued that no-poach agreements should be subject to the per se rule unless the ancillary restraints doctrine21 or core venture doctrine22 applies, meaning that, in most cases, these agreements are so clearly anticompetitive that the court does not need to ask whether any procompetitive benefits might outweigh the anticompetitive effects.23 DOJ has collected these and other recent Statements of Interest in no-poach cases on a webpage called the "No-Poach Approach," signaling that it intends to put employers on notice of heightened scrutiny in this area.24

Courts have found DOJ’s Statements of Interest persuasive. In In re Railway Industry Employee No-Poach Antitrust Litigation, for instance, the district court referenced DOJ’s Statement of Interest directly, writing that it supported the court’s refusal to dismiss the plaintiffs’ complaint because it "explained that the federal agencies charged with enforcing the antitrust laws consider naked no-poach agreements per se violations of the Sherman Act and DOJ will proceed criminally against those who enter into those kinds of agreements."25


Over the past few years, DOJ has shifted its focus from civil enforcement to criminal enforcement. Beginning in 2016, DOJ repeatedly avowed that it would crack down on no-poach agreements, including specifically through criminal prosecution. In October 2016, DOJ and FTC published Antitrust Guidance for Human Resources Personnel, which warned HR professionals that the agencies would prosecute "naked" no-poach agreements as per se violations of Section 1 of the Sherman Act.26 At that time, Acting Assistant Attorney General Renata Hesse said, "HR professionals need to understand that these violations can lead to severe consequences, including criminal prosecution."27 And in early 2018, Assistant Attorney General Makan Delrahim reiterated that DOJ intended to criminally prosecute no-poach agreements.28 Shortly after the start of the COVID-19 pandemic, DOJ and FTC issued a joint statement that they were closely monitoring anticompetitive conduct in labor markets, particularly for front-line workers, and that DOJ "may criminally prosecute companies and individuals who enter into naked wage-fixing and no-poach agreements."29

Despite these public warnings, DOJ had never criminally prosecuted an employer for participating in a no-poach agreement. That changed in 2021, when DOJ brought no fewer than four criminal cases challenging companies’ alleged use of no-poach agreements. First, in January 2021, DOJ announced its first criminal indictment in this area. A federal grand jury in the Northern District of Texas returned a two-count indictment charging defendants Surgical Care Affiliates LLC and its related entity (collectively, "SCA"), which own and operate outpatient medical care centers across the United States,

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with violating the Sherman Act by agreeing with competitors not to solicit each other’s employees.30 Count 1 alleged that SCA and an unnamed competitor agreed not to solicit specific senior-level employees, expressly instructed their employees to abide by the agreement, and refrained from soliciting each other’s employees in accordance with the agreement. The indictment describes multiple communications referencing the alleged agreement, including an email from the CEO of the unnamed competitor to employees stating, "I had a conversation w [the CEO of SCA] re people and we reached agreement that we would not approach each other’s proactively."31 Count 2 made similar allegations about an agreement between SCA and a different competitor, relying on a number of communications that evidenced the alleged agreement.32

In March 2021, DOJ returned yet another criminal indictment for the use of no-poach agreements, this time against healthcare staffing company VDA OC, LLC, formerly Advantage on Call, LLC ("AOC"), as well as a regional manager of AOC.33 The one-count indictment charged the defendants with engaging in a per se unlawful no-poach agreement in violation of Section 1 of the Sherman Act.34 Specifically, DOJ alleged that from around October 2016 through July 2017, the defendants and others entered into a conspiracy "to suppress and eliminate competition for the services of nurses by agreeing to allocate nurses and to fix the wages of those nurses."35 DOJ further alleged that "[t]he charged conspiracy consisted of a continuing agreement, understanding, and concert of action among the defendants and their coconspirators, the substantial terms of which were that AOC and Company A would allocate nurse employees but not recruiting or hiring certain nurses from each other and would refrain from raising the wages of those nurses."36

In July 2021, DOJ announced yet another indictment for a no-poach agreement, this time against DaVita, Inc. and its former CEO Kent Thiry.37 The three-count superseding indictment38 charged the defendants with violating Section 1 of the Sherman Act by participating in market allocation agreements from February 2012 through July 2019.39 DOJ alleged that DaVita and Thiry participated in an agreement among owners and operators of outpatient medical facilities throughout the country, including SCA, to not solicit the employees of co-conspirators. In particular, the indictment pointed to communications and meetings among the conspirators, including an email from Thiry to the CEO of SCA indicating that "[s]omeone called me to suggest they reach out to your senior biz dev guy for our corresponding spot. I explained I do not do proactive recruiting into your ranks."40 DOJ cited several other allegedly collusive communications, among them an email from an SCA human resources executive to a recruiter stating that certain of SCA’s competitors were "off limits to SCA."41

Finally, in December 2021, DOJ announced a criminal indictment alleging that six former aerospace executives participated in an agreement spanning 2011 to 2019 with managers and executives of several outsource engineering suppliers to restrict the hiring and recruiting of engineers and other skilled workers.42 The one-count indictment charged the defendants with engaging in a no-poach agreement in violation of Section 1 of the Sherman Act.43 DOJ alleged that the defendants "attended meetings and engaged in discussions . . . concerning restricting the hiring and recruiting of engineers and other skilled-labor employees in the United States," agreed to restrict the hiring and recruitment of engineers and other skilled workers, took steps to effectuate the agreement, encouraged compliance with the agreement, monitored and enforced compliance with the agreement, and took steps to conceal the existence of the agreement.44

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In the DaVita case, Davita, Inc. and its former CEO Kent Thiry moved to dismiss DOJ’s indictment on the ground that no-poach agreements cannot constitute criminal antitrust violations. On January 28, 2022, Senior Judge R. Brooke Jackson of the U.S. District Court for the District of Colorado denied that motion.45 In so doing, Judge Jackson became the first federal district judge to endorse DOJ’s view that no-poach agreements can give rise to criminal liability.

Judge Jackson held that DOJ’s indictment sufficiently alleged that the defendants’ conspiracy fell under an existing category of conduct subject to per se treatment—horizontal market allocation agreements—and that it should accordingly be analyzed as a potential per se violation of Section 1.46 The order rejected the defendants’ argument that relevant precedent does not treat non-solicitation agreements as subject to per se treatment.47 Judge Jackson did, however, disagree with DOJ’s "apparent assertion that all non-solicitation agreements and all no-hire agreements are horizontal market allocations and thus per se unreasonable."48 Judge Jackson concluded "that if naked non-solicitation agreements or no-hire agreements allocate the market, they are per se unreasonable," but refused to adopt DOJ’s proposed categorical rule.49

Taking a victory lap, DOJ filed quickly notices of supplemental authority in two other pending criminal no-poach cases (SCA and Hee) in early February 2022, seeking to leverage Judge Jackson’s DaVita order to defeat other pending motions to dismiss.50 In its notice of supplemental authority in SCA, DOJ cited the DaVita order for its conclusions that "each count of the indictment alleged a horizontal market allocation conspiracy carried out by a non-solicitation sufficient to state a per se violation of Section 1 . . . and . . . defendants had ‘ample notice’ for purposes of the Due Process Clause’s fair warning requirement that the charged conspiracies ‘to allocate the market would expose them to criminal liability.’"51


Following the DaVita ruling, more aggressive criminal enforcement in the no-poach context seems likely, and employers should take care to minimize antitrust risk. First, employers should ensure that if they must communicate with competitors for legitimate business purposes—and they should not communicate with competitors for any other reason—those communications do not form the basis of a potential antitrust case. Specifically, employers should document the business reasons for any communications with competitors and retain that documentation. They should be very careful about the phrasing of any written communications, avoiding any language, euphemisms, or jokes that could be construed as suggesting any kind of agreement related to employment practices (e.g., hiring, wages, benefits). In addition, if a competitor initiates any discussion or agreement regarding hiring, wages, or benefits, employers should not engage in that discussion and should promptly report the communication to legal counsel.

Second, employers must take steps to avoid antitrust risk when meeting with competitors—which, again, should only be done when necessary to accomplish legitimate, specifically identifiable business purposes. Before any meeting with competitors (for example, at industry conferences), employers should prepare a written agenda—ensuring that it does not, of course, contain any discussion of topics that could arouse antitrust suspicions like compensation or territorial allocation across companies—and circulate it in advance. During the meeting, employers should make sure that the meeting participants stick to the agenda. Ideally, counsel should be present to help ensure that the conversation does not veer into prohibited territory. Employers should also make

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sure to take accurate notes of the proceedings, review those notes before they are finalized, and circulate the notes to ensure that nothing could be misinterpreted as suggesting an agreement regarding employment practices. These notes should identify the legitimate business purposes served by the meeting.

Third, employers must be careful to avoid missteps that could result in actual or perceived collusion. For instance, employers should never discuss with competitors where each company should operate or what types of business each organization will handle. Similarly, employers should never discuss wages or benefits and policies with competitors. This applies even if those topics are discussed in passing or in generalities. If a competitor does attempt to discuss employee compensation, benefits, or territorial allocation, employers should refuse to engage in that discussion—and in so doing, must be careful avoid language or gestures that might convey agreement (e.g., "mutual understanding," "collaboration," or "level the playing field"). Employers finding themselves in this situation should protest that the discussions may violate the antitrust laws and make a "noisy" withdrawal from the discussion (stating that they are withdrawing from the discussion and explaining why), and promptly consult with legal counsel.

More generally, employers should consult with legal counsel experienced in labor antitrust issues to develop an internal compliance program with respect to their employment practices that ensures ongoing adherence to the antitrust laws. This program should include antitrust compliance training for management and employees, as well as internal mechanisms for reporting antitrust concerns to in-house counsel.


Given DOJ and FTC’s increased focus on enforcing the antitrust laws against employers for their use of no-poach agreements, particularly the uptick in criminal indictments in the past year, it is crucial for employers to ensure that they avoid antitrust scrutiny of their employment practices. Taking steps to avoid unnecessary competitor contacts, to properly document and conduct any communications with rivals that are necessary for legitimate business purposes, to avoid common but dangerous missteps, and to engender a culture of antitrust compliance are vital to minimizing antitrust risk in employment practices. Consulting with legal counsel experienced in labor market antitrust should also form a critical part of employers’ compliance strategy.



1. Laura K. Kaufmann is a litigation associate in the Los Angeles office of O’Melveny & Myers LLP. Laura’s practice focuses on complex civil litigation and internal investigations. Prior to joining O’Melveny, Laura interned for the Honorable Jane A. Restani of the United States Court of International Trade. As a law student at New York University School of Law, Laura served on the Executive Board of the Journal of International Law and Politics and as a Student Fellow of the Program on Corporate Compliance and Enforcement. The opinions expressed in this article are those of the author and do not necessarily reflect the views of O’Melveny & Myers LLP or its clients.

2. See, e.g., 6 Reasons that Pay Has Lagged Behind U.S. Job Growth, N.Y. TIMES (Feb. 1, 2018), (discussing several potential reasons for the problem); Gillian B. White, The Workers Whose Paychecks Are Shrinking, THE ATLANTIC (Sept. 4, 2015), (discussing the problem that low-wage workers faced a decrease in real wages notwithstanding a growth in employment after the recession ended in 2009).

3. See, e.g., Elena Prager & Matt Schmitt, Employer Consolidation and Wages: Evidence from Hospitals, 111 AM. ECON. R. 397 (Feb. 2021); José Azar, loana Marinescu, Marshall I. Steinbaum, & Bledi Taska, Concentration in US Labor Markets: Evidence From Online Vacancy Data (National Bureau of Economic Research, Working Paper No. 24395, Feb. 2019),; Efraim Benmelech, Nittai Bergman, & Hyunseob Kim, Strong Employers and Weak Employees: How Does Employer Concentration Affect Wages (National Bureau of Economic Research, Working Paper No. 24037, Feb. 2018),; loana Marinescu, José Azar, & Marshall Steinbaum, Labor Market Concentration (National Bureau of Economic Research, Working Paper No. 24147, Dec. 2017),

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4. See, e.g., Benmelech et al., supra note 3, at 1-2.

5. See, e.g., ERIC A. POSNER, HOW ANTITRUST FAILED WORKERS (2021); Hiba Hafiz, Why a "Whole-of-Government" Approach is the Solution to Antitrust’s Current Labor Problem, PROMARKET (Nov. 18, 2021),

6. See, e.g., Posner supra note 5, at 36-38.

7. Press Release, U.S. Dep’t of Justice, Justice Department Requires Six High Tech Companies to Stop Entering into Anticompetitive Employee Solicitation Agreements (Sept. 24, 2010),; Press Release, U.S. Dep’t of Justice, Justice Department Requires Lucasfilm to Stop Entering into Anticompetitive Employee Solicitation Agreements (Dec. 21, 2010),

8. Justice Department Requires Six High Tech Companies to Stop Entering into Anticompetitive Employee Solicitation Agreements, supra note 7.

9. Justice Department Requires Lucasfilm to Stop Entering into Anticompetitive Employee Solicitation Agreements, supra note 7.

10. Ted Johnson, Animation Workers Reach $100 Million Settlement With Disney in Wage-Fixing Suit, VARIETY (Jan. 31, 2017),

11. See United States v. eBay, Inc., 968 F. Supp. 2d 1030 (N.D. Cal. 2013).

12. Id. at 1032-34.

13. Press Release, U.S. Dep’t of Justice, Justice Department Requires eBay to End Anticompetitive "No Poach" Hiring Agreements (May 1, 2014),

14. Press Release, U.S. Dep’t of Justice, Justice Department Sues to Block Penguin Random House’s Acquisition of Rival Publisher Simon & Schuster (Nov. 2, 2021),

15. Id.

16. Compl. at 4, United States v. Bertelsmann SE & CO., No. 1:21-cv-02886 (D.D.C. Nov. 2, 2021), ECF No. 1.

17. Id. at 6.

18. Press Release, Wash. Att’y Gen., AG Report: Ferguson’s Initiative Ends No-Poach Practices Nationally at 237 Corporate Franchise Chains (June 16, 2020),

19. See Amicus Curiae Br. by the Att’y Gen. of Wash. at 6-7, Stigar v. Dough Dough, Inc., No. 2:18-cv-00244-SAB (E.D. Wash. Mar. 11, 2019), ECF No. 36 (arguing that no-poach agreements in the franchise context are per se illegal under the antitrust laws of Washington state; "[T]o the extent a franchise agreement restricts solicitation and hiring among franchisees and a corporate-owned store—which is indisputably a horizontal competitor of a franchisee for labor—the agreement must properly be analyzed as a per se restraint.").

20. Statement of Interest of the United States at 8, In re Ry. Indus. Emp. No-Poach Antitrust Litig., No. 2:18-MC-00798-JFC (W.D. Pa. Feb. 8, 2019), ECF No. 158; see also Statement of Interest of the United States at 22, Seaman v. Duke University, No. 1:15-CV-462 (M.D.N.C. Feb. 1, 2018), ECF No. 325 ("Just as an agreement between competitors to allocate customers eliminates competition for those customers, an agreement between them to allocate employees eliminates competition for those employees.").

21. The ancillary restraint doctrine states that a potentially anticompetitive agreement may be subject to rule-of-reason analysis rather than the per se rule if the agreement is ancillary to a legitimate business purpose that could have procompetitive effects. Aya Healthcare Servs., Inc. v. AMN Healthcare, Inc., 9 F.4th 1102, 1109 (9th Cir. 2021).

22. The core venture doctrine invokes rule-of-reason analysis for qualifying agreements, and applies where the agreement at issue involves the core activity of a joint venture. See Broadcast Music, Inc. v. Columbia Broadcasting Sys., Inc., 441 U.S. 1, 23 (1979) ("Joint ventures and other cooperative arrangements are . . . not usually unlawful, at least not as price-fixing schemes, where the agreement is necessary to market the product at all.").

23. Statement of Interest of the United States, In re Ry. Indus. Emp. No-Poach Antitrust Litig., supra note 20, at 9.

24. No-Poach Approach, U.S. DEP’T OF JUSTICE (Sept. 30, 2019),

25. In re Ry. Indus. Emp. No-Poach Antitrust Litig., 395 F. Supp. 3d 464, 485 (W.D. Pa. 2019).


27. Press Release, U.S. Dep’t of Justice, Justice Department and Federal Trade Commission Release Guidance for Human Resource Professionals on How Antitrust Law Applies to Employee Hiring and Compensation (Oct. 20, 2016),

28. Matthew Perlman, Delrahim Says Criminal No-Poach Cases Are In The Works, LAW360 (Jan. 19, 2018),

29. Press Release, Fed. Trade Comm’n, Federal Trade Commission and Justice Department Issue Joint Statement Announcing They Are on Alert for Collusion in U.S. Labor Markets (Apr. 13, 2020),

30. Indictment, United States v. Surgical Care Affiliates, No. 3:21-CR-011-L (N.D. Tex. Jan. 5, 2021), ECF No. 1. On July 8, 2021, DOJ filed a superseding indictment. See Superseding Indictment, United States v. Surgical Care Affiliates, No. 3:21-CR-011-L (N.D. Tex. July 8, 2021), ECF No. 48.

31. Superseding Indictment, United States v. Surgical Care Affiliates, supra note 30, at 3-5.

32. Id. at 7-10.

33. Indictment, United States v. Hee, No. 2:21-cr-00098-RFB-BNW (D. Nev. Mar. 26, 2021), ECF No. 1.

34. Id.

35. Id. at 4.

36. Id.

37. Indictment, United States v. DaVita, Inc., No. 1:21-cr-00229-RBJ (D. Colo. July 14, 2021), ECF No. 1.

38. DOJ filed a Superseding Indictment on November 3, 2021.

39. See Superseding Indictment, DaVita, No. 1:21-cr-00229-RBJ (D. Colo. Nov. 3, 2021), ECF No. 74.

40. Id. at 3.

41. Id. at 3-4.

42. Indictment, United States v. Patel, No. 3:21-cr-00220-VAB (D. Conn. Dec. 15, 2021), ECF No. 20; Press Release, U.S. Dep’t of Justice, Former Aerospace Outsourcing Executive Charged for Key Role in a Long-Running Antitrust Conspiracy (Dec. 9, 2021),

43. Indictment, Patel, supra note 42, at 4-5.

44. Id. at 5-13.

45. Order Denying Defs.’ Mot. to Dismiss, DaVita, No. 1:21-cr-00229-RBJ (D. Colo. Jan. 28, 2022), ECF No. 132.

46. Id. at 9-14.

47. Id. at 14-16.

48. Id. at 16.

49. Id. at 17.

50. United States’ Notice of Additional Authority, Surgical Care Affiliates, No. 3:21-CR-011-L (N.D. Tex. Feb. 1, 2022), ECF No. 96; United States’ Notice of Suppl. Authority, Hee, No. 2:21-cr-00098-RFB-BNW (D. Nev. Feb. 3, 2022), ECF 69. DOJ will likely also file a notice of supplemental authority in Patel once defendants have filed a motion to dismiss.

51. United States’ Notice of Additional Authority, Surgical Care Affiliates, supra note 50, at 1.

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