The EU General Court's Decision Regarding Economic Continuity

Under U.S. law, companies have been held responsible for antitrust violations committed before mergers and stock acquisitions. Indeed, in the United States Department of Justice's investigation and prosecution of the Marine Hose cartel, Parker ITR was charged with and pleaded guilty to cartel conduct "beginning at least as early as 1999" — three years before Parker's acquisition of the business.Yet another example is the Tenth Circuit's decision in United States v. Wilshire Oil Co. of Texas, in which the court refused to dismiss criminal charges against an acquiring entity for premerger conduct in a conspiracy to fix the price of asphalt sold to state highway departments.[6] Notably, the court rejected the acquiring company's claim that it "unwittingly bought into an ongoing conspiracy," instead finding that the company "had ample opportunity to detect and reject the illegal practices" prior to and after its assumption of control.

Courts have also applied this broader view of successor liability beyond the criminal antitrust context in other federal criminal cases in which acquiring companies have been held liable for acts of predecessor entities. In imposing successor liability, U.S. courts have relied on federal common law, as well state law regarding business corporations.In contrast to cases involving liability after mergers or stock acquisitions, U.S. courts have hesitated to hold an acquiring company liable for criminal violations committed by the entity from which the company acquires assets. For instance, United States v. Carter, the Sixth Circuit held that the defendant City Products' motion for acquittal should have been granted where the criminal charges stemmed from its acquisition of the assets of a culpable brewing company.City Products had acquired the assets of a brewing company, Pilsener Brewing, whose president, George Carter, had been charged with making payments to union officials in violation of the Taft-Hartley Act.

The court noted that City Products had no employees who were union officials and the asset acquisition "would not make it chargeable, as a principal, for a crime previously committed by Pilsener or Carter."Similarly, in United States v. Ashland Oil, the district court rejected the argument that the transfer of assets to a subsidiary would automatically create criminal antitrust liability for that entity.Defendant Ashland Oil argued that the double jeopardy clause prevented it from being charged because it had transferred to its subsidiary the assets of a division that had engaged in bid-rigging.Ashland Oil further contended that after the asset transfer, the subsidiary was the only entity that could be liable, but it had already been prosecuted in a prior antitrust case.