Elna capacitor plea rejected again; trial still set for November

Golden Gate Bridge

13 September 2017. By Joshua Sisco.

Japanese electronics company Elna was unsuccessful Wednesday in its second attempt to plead guilty to fixing prices of capacitors as a California federal judge stuck to plans for a Nov. 6 trial.

At a hearing in San Francisco, US District Judge James Donato rejected Elna's guilty plea, saying it wasn't sufficiently responsive to the objections he made when he turned down the company's previous attempt at a guilty plea.

"I got exactly the same plea," Donato said.

Elna's guilty plea and proposed $3.825 million fine were initially rejected by Donato in June. At that time, the judge appeared to take issue primarily with what he viewed as an overly generous five-year payment plan and an inadequately described assertion from the company that it was unable to pay a higher fine.

At Wednesday's hearing, Elna attorney Thomas Mueller told the court that it is important to be consistent when sentencing related defendants, and Donato should consider the sentences he imposed on NEC Tokin, Hitachi Chemical and Rubycon, which also pleaded guilty to capacitor price-fixing.

But the judge interrupted, telling Mueller that the hearing is only for a change of plea, not sentencing.

"I didn't anticipate I would get exactly the same plea," Donato said.

Mueller said Elna responded to his principal objection to the plea by providing more information about the company's inability to pay a higher fine.

That is a "misunderstanding on your part," Donato responded.

The judge said that his principle objection was that the plea agreement didn't "serve the ends of justice," adding, "I thought I was clear about that."

Donato has taken issue with the so-called C pleas used by antitrust prosecutors. The federal rules of criminal procedure provide for entities pleading guilty to a crime to negotiate a plea with the government that is then brought to a court for approval.

Typical plea agreements leave the judge to determine a sentence;a C pleas include the sentence, and the judge must rule on the whole package. If it is rejected, a defendant is free to withdraw the plea and either fight the charges or negotiate a new agreement.

Mueller said accepting the company's plea would further the "fair administration of justice."

Elna's proposed fine reflects a reduction since it lacks an ability to pay more. ​There are "simply no further monies available," he said.

Also, Elna has cooperated from the start of the investigation, which led to plea agreements from two companies, Mueller said.

While he didn't specify which companies, he said one has already been sentenced and the other, which is awaiting sentencing, also has an executive pleading guilty.

Matsuo Electronics, which agreed to a guilty plea, is the only company in the case with an executive who has pleaded guilty. Sales executive Satoshi Okubo was sentenced to a year in prison, but the company will be back in court Oct. 25 to try again after its proposed $4.17 million fine also was rejected by Donato because of a lenient payment plan.

The judge initially set the Nov. 6 trial date when he rejected Elna's first plea. Since then, Holy Stone also has had its plea rejected, and it was given the same trial date.

It is not yet clear whether any other defendants will try their cases at that time. US Department of Justice attorney Howard Parker told the court that Matsuo's status is still undecided, and the ongoing grand jury investigation could lead to more charges.

Additionally, Nichicon agreed to plead guilty and pay a $42 million fine, but it has yet to have a court date.

Donato said he wants to try as many defendants together as possible, and it is "full speed ahead" to Nov. 6. He set an Oct. 4 status conference for all defendants to further discuss details of a trial.

It is unclear whether the defendants with rejected guilty pleas will need to be indicted by a grand jury prior to a trial. Some companies maintain that their waiver of indictment is no longer valid if their plea is rejected, but that issue hasn't yet been resolved by the court.

	Eliot Gao