Hogan Lovells, DOJ Lock Horns over Katyal Appearance in LCD Antitrust Case

, The Litigation Daily

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With a high-profile criminal conviction in the government's price-fixing case against LCD manufacturer AU Optronics Corp. in the balance, federal prosecutors in San Francisco are asking a judge to bar former Acting U.S. Solicitor General Neal Katyal from representing one of the company's executives in post-trial appeals. In a letter filed with U.S. District Judge Susan Illston on Friday, Peter Huston, the assistant chief of DOJ's antitrust division in San Francisco, said the government plans to raise "various ethical issues" to Katyal joining the case. [Hat tip: Law 360.]

Back in March, prosecutors scored a major trial victory in the antitrust case against AUO, one of the leading manufacturers of thin-film liquid crystal displays used in computers and televisions. A jury found the company and two of its top executives, president Hsuan Bin Chen and former executive vice president Hui Hsiung, guilty in a $500 million price-fixing conspiracy.

In late April lawyers for Hsiung at Hogan Lovells, the firm that Katyal joined after leaving the Justice Department last June, asked the judge to allow Katyal to appear as counsel for Hsiung. The trouble is, as acting solicitor general, Katyal's name appeared on this brief in opposition to a writ of certiorari at the U.S. Supreme Court filed by White & Case and Nossaman. The firms were attempting to quash grand jury subpoenas for discovery material in the civil LCD class action antitrust litigation--material the government wanted for its criminal antitrust investigation of the LCD market.

Hsiung's lawyers must have anticipated a fight, because their 21-page motion to permit Katyal's appearance lays out the government's potential objections and attempts to shoot them down one-by-one.

According to the Hogan lawyers, the government will argue that Katyal can't sign on to represent Hsiung in the criminal case until two years after the end of his government service. Federal guidelines restrict an official's involvement in matters he or she had responsibility for while in office. But Katyal's partners, Michael Shepard and Christopher Handman, argue that the restriction shouldn't apply.

"Because the post-trial proceedings do not involve the same 'specific party' and are not the same 'particular matter' as the subpoena litigation, Katyal's appearance would neither violate the rules restricting representation by former government lawyers nor create an appearance of impropriety," they wrote. The Hogan Lovells lawyers also pointed out that Katyal's name appeared on all briefs in opposition to cert petitions filed by the federal government as a matter of course while he was acting solicitor general, and that he had no personal knowledge of the subpoena litigation.

Katyal and Shepard at Hogan Lovells did not immediately respond to our calls for comment. We also reached out to the DOJ's Huston, whose opposition to Katyal's appearance is due Wednesday, but our call was forwarded to a spokesperson for the antitrust division who declined to comment.

On Friday, meanwhile, prosecutors filed their 61-page opposition to the defendants' post-trial motions asking the judge to toss the convictions and for a new trial. The government argued, among other things, that the foreign aspects of the defendants' price-fixing conspiracy don't justify acquittals or a new trial. As we've previously reported, AUO has argued that the DOJ overreached by targeting an alleged conspiracy that (the defense asserts) unfolded on foreign soil. The appeal in the case could end up testing how much  overseas conduct is fair game in U.S. antitrust enforcement efforts.

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