Aerospace executives indicted
Prosecutors: 6 conspired to cut labor costs; conspiracy affected thousands of engineers, skilled workers
BRIDGEPORT — A federal grand jury returned an indictment this week, charging six aerospace executives and managers for allegedly conspiring to limit workers’ mobility and career prospects, according to prosecutors.
The grand jury in Bridgeport on Wednesday returned the indictment, which charged a former manager of a major aerospace engineering company and five executives of outsourcing engineering suppliers to participate in the long-running scheme to restrict the hiring and recruiting of employees among companies.
Prosecutors said the conspiracy impacted thousands of engineers and other skilled workers in the industry who performed services in the fields of design, manufacturing and servicing of aircraft components for commercial and military purposes.
According to the one-count felony indictment, unsealed Thursday in the U.S. District Court for the District of Connecticut, six individuals conspired with unnamed others to allocate workers by agreeing not to hire or seek employees from each other’s companies, prosecutors said.
The six individuals charged were Mahesh Patel, of Connecticut; Harprett Wasan, of Connecticut; Steven Houghtaling, of Connecticut; Tom Edwards, of Connecticut, Gary Prus, of Florida; and Robert Harvey, of South Carolina.
Prosecutors said this week’s indictment is the first in an ongoing investigation into labor market allocation in the aerospace engineering services industry.
Patel, described by prosecutors as the leader of the conspiracy, was previously charged by a separate complaint. He was arrested and appeared before a federal magistrate judge on the charge last week. He was released after posting a $100,000 bond.
The remaining five defendants were expected to appear in federal district courts in different areas Thursday and Friday.
The indictment alleges that the defendants and co-conspirators carried out the conspiracy to reduce the increase in labor costs that would arise when aerospace workers were able to find employment in a competitive environment.
“No one should be illegally denied the opportunity to pursue better jobs, higher pay and greater benefits,” Peter S. Jongbloed, counsel to the Connecticut U.S.
Attorney, said in a statement. “It is vital that the labor market in the defense and aerospace remain fair, open and competitive, and we look forward to continuing the partnership with the Antitrust Division and our law enforcement partners to prosecute this important case.”
Assistant Attorney General Jonathan S. Kanter, of the Department of Justice’s Antitrust Division, said in a statement that conduct like what is outlined in the indictment has “no place in our economy.” He said the investigation revealed a “prolonged and widespread scheme” to prevent aerospace workers from planning their careers and earning competitive pay.
The maximum penalty under the Sherman Act for a conspiracy to restrain trade is 10 years in prison and a fine of $1 million, prosecutors said. The maximum fine can be higher than twice the gain derived from the scheme, or twice the loss suffered by the victims, if either amount is more than the statutory maximum fine.