Jurors hear from victim of alleged corporate conspiracy in ongoing DaVita trial
After a week of calling corporate executives to testify and airing communications between the enablers of an alleged white-collar conspiracy, the government’s attorneys on Tuesday closed their case by letting the jury hear from one victim of the scheme.
Elliot Holder, a self-described mid-level employee of kidney care company DaVita, Inc., recounted his experience interviewing for a job outside of DaVita, only to be told that he had to comply with the terms of an alleged agreement he had no knowledge of. Unofficial “ground rules” from Radiology Partners, the company where Holder was applying, stipulated that he needed to tell his boss at DaVita that he was exploring jobs elsewhere.
“I remember just, it was really weird,” Holder testified. “I felt pretty anxious at the time, I remember. I was younger, obviously, in my career, so I was really nervous about telling my bosses anything.”
The U.S. Department of Justice’s Antitrust Division has charged DaVita and its former CEO, Kent Thiry, with three counts of a conspiracy to “allocate the market” for employees. In essence, the government alleges Thiry conspired to keep his employees at DaVita by putting up hurdles for other companies to recruit DaVita workers and intentionally stifling competition in the process.
There are three such non-solicitation agreements under scrutiny between DaVita and the companies Surgical Care Affiliates, Hazel Health and Radiology Partners. Jurors previously heard from Radiology Partners’ CEO, Rich Whitney, about the ground rules he proposed to Thiry to avoid recruiting DaVita workers for his company – unless they were actively looking for other jobs or had told their supervisor they were being considered for a position.
In preparation for a 2016 job interview with Radiology Partners, Holder said the company emailed him a short list of questions, one of which he found odd: “Is your direct leadership aware that you are looking for other opportunities?” Holder answered in the negative.
“Did you want to keep your job search confidential?” asked Justice Department attorney Anthony Mariano.
“Yeah, 100%. I figured that if my leadership found out, it would jeopardize my future or my career path,” responded Holder, who is no longer at DaVita. “If my bosses knew that I was actively shopping around or looking for opportunities, they would be hesitant to say, ‘Let’s invest in this person and give him more responsibility’.”
Holder put his experience in context: In 2015, he had obtained a job offer from another company – without the requirement that he tell his supervisor before applying. Ultimately, he chose to stay at DaVita, leveraging the competing offer into higher compensation. The following year, after Radiology Partners informed him of the need to tell his supervisor he was looking, Holder ended up withdrawing from consideration. Subsequently, and unrelated to the Radiology Partners offer, Holder received a raise and promotion.
If he had told his DaVita boss about the latter offer, Holder speculated, “the promotion I got to manager definitely wouldn’t have happened because they’d see I wasn’t invested in the team long term.”
The defense also presented their case, consisting of a single expert witness. Economics consultant Pierre-Yves Cremieux shared his opinions that the three non-solicitation agreements that DaVita entered into did not appear to stifle competition for DaVita workers, lower their compensation or reduce their rates of leaving the company.
With a team of 25 to 30 people hired by the defense, Cremieux attempted to prove the government’s allegations that DaVita had allocated the labor market, but ended up seeing no economic indicators that the claims were true.
“We see meaningful competition,” Cremieux testified. “The data indicates that the degree of competition between DaVita and SCA, DaVita and Hazel, DaVita and RP is indistinguishable from the degree of competition I observed from other companies hiring from DaVita.”
He elaborated that during the period of the alleged conspiracy agreements, median salaries for senior DaVita employees increased, as did turnover. An illegal market allocation agreement should produce the opposite results, Cremieux said.
On cross-examination, Cremieux acknowledged some errors in his expert report, noting that he was given only one week to generate a report for the trial earlier this year. The government also questioned Cremieux’s methodology and offered alternative explanations for the trends in compensation and turnover at DaVita.
“What tells us more about what was in Mr. Thiry’s mind: the data or what Mr. Thiry said at the time?” asked government lawyer William Vigen.
“I don’t have an opinion about that,” Cremieux responded.
Jurors submitted well over one dozen questions to Cremieux, only some of which U.S. District Court Senior Judge R. Brooke Jackson was able to pose to Cremieux before the end of the day. The questions suggested that some members of the jury were deeply curious about Cremieux’s analysis.
“How did you control for other factors that may have affected employee movement in the market between allocation and pre-allocation years?” one question read.
Prior to the beginning of the defense’s case, the defendants asked the judge to enter a verdict of acquittal, arguing the prosecution had presented insufficient evidence to show a criminal antitrust violation.
“The court at this point must conclude that as a matter of law the non-solicitation agreements alleged here do not and cannot allocate the market,” said defense lawyer John Walsh, who formerly was the top federal prosecutor in Colorado.
Walsh elaborated that the prosecution, who has the responsibility of proving beyond a reasonable doubt that the defendants are guilty of a crime, failed to show that the non-solicitation agreements ceased the competition for DaVita employees. In fact, jurors had heard that employees did leave DaVita during the alleged conspiracy period for the other companies. Walsh also contended that an agreement may not have even existed with two of the companies after all.
Jackson, who previously denied a motion to dismiss the charges before trial, gave the request a chilly reception.
“Mr. Walsh, you’re making a fine closing argument, but that’s not what we’re here for. We’re talking about a very distinct and rarely-granted motion to dismiss,” Jackson said. In response to an observation that the defendants’ intent was the key issue of the trial, Jackson explained that he was inclined to let the jury decide whether Thiry and DaVita acted with criminal intent.
“Intent – as has been said by me and many judges before me and will be said by many judges after me – is something as to which there is rarely much, if any, direct evidence,” he said. “It is a matter of circumstantial evidence in almost every case and it is rare for a judge to supplant a jury when it comes to determining what someone’s intent was or was not.”
The judge said he would respond to the request for an acquittal after the defense filed a written motion. If Thiry decides not to testify in his own defense, the jury could begin its deliberations as soon as Wednesday.
The case is United States v. DaVita, Inc. et al.


