DOJ Denies Mishandling of Medical Staffing Company Anti-competitive Investigation

The Department of Justice denied allegations that it mishandled an interview of an indicted former health care staffing manager who is accused of colluding with a competitor to suppress wages for Las Vegas school nurses. 

Defendant Ryan Hee, former regional manager of a health care staffing company now known as VDA OC LLC, allegedly made a written agreement with the regional manager of a competing company not to recruit or hire each other’s nurses and to reject wage increase requests from nurses in October 2016. The supposed agreement continued until July 2017 when the company was purchased by Cross Country Healthcare. The Department of Justice began investigating the companies in 2019, during which time Hee consented to a 30-minute interview, admitting to the anti-competitive agreement and allowing the FBI to image his cell phone and work laptop, court documents state. However, Hee claims in a motion to dismiss the case that the statements he made during the interview were illegally obtained. 

“The government directed a solo FBI agent to interview Mr. Hee, a represented party, without counsel present and without informing his counsel, and further provided access to three Antitrust Division attorneys by a real-time audio livestream link of Mr. Hee’s interview without informing Mr. Hee that his interview was being broadcasted or that these prosecutors could be surreptitiously listening to his interview. This conduct makes Mr. Hee’s consent involuntary,” the defendants’ representatives state. 

In response, the DOJ stated that Hee was not represented by counsel at the time of the interview, claiming that employees are only represented by corporate counsel if their actions have the authority to legally bind the corporation. 

“The notion that Defendant, a sales manager at a regional office of a CCH subsidiary, had the authority to bind the parent company with respect to a grand jury subpoena served a day earlier by, for example, agreeing to waive privilege over certain documents, is absurd,” the plaintiffs stated. 

Previously, in a March 2021 press release, CCH refuted all claims that it was involved in the investigation. 

Even if Hee was represented by counsel at the time of his interview, the DOJ stated that its contact with him didn’t violate Rule 4.2 of the American Bar Association’s Model Rules of Professional Conduct because of the law enforcement exception. In addition, it claims the livestreaming of the interview didn’t violate the prosecutors’ obligations under Rule 8.4 to refrain from misrepresentations. 

“Neither the attorneys nor the agent made any misrepresentations, and the Ninth Circuit has made clear that prosecutors may supervise agents and witnesses in investigative activities involving surreptitious recordings of targets, and other acts of subterfuge,” the plaintiffs stated.

Trial is currently set for February 28, 2022. 

The defendants are represented by Wright Marsh & Levy