NEW YORK -- A federal judge accepted Sotheby Holding Inc.'s guilty plea to price-fixing charges and ordered the auction house to pay a previously agreed-upon $45 million criminal fine.
Sotheby's had entered the guilty plea in October, but U.S. District Judge Lewis A. Kaplan in Manhattan refused to grant approval until he could review the plea agreement, which was carefully crafted by the auction house's lawyers and the Justice Department.
At a hearing Friday, the judge said he believed the fine was adequate in part because Sotheby's "is being asked to shoulder a disproportionate share of the burden." Rival auction house Christie's escaped prosecution -- and a criminal fine -- through its cooperation with the government.
Judge Kaplan noted that Sotheby's, based in Bloomfield Hills, Mich., and Christie's, of London, agreed to pay hundreds of millions of dollars to settle civil lawsuits brought by art buyers and sellers who claimed the auction houses colluded on commission prices and defrauded them.
In addition, Sotheby's is paying $70 million to settle related shareholder litigation. Christie's, as a private company, hasn't faced similar suits.
The judge said a stiffer fine imposed on Sotheby's could harm the auction house's financial situation. "There is a strong public interest in making sure Sotheby's and Christie's survive the litigation," he said. "Should one fail, the other would be in a position to lift market prices."
In October, Diana D. Brooks, Sotheby's former president and chief executive pleaded guilty to conspiracy to fix commission rates for auction customers from at least April 1993 through 1999. She also agreed to become a government witness against her former superior, A. Alfred Taubman, the former chairman and controlling stockholder of Sotheby's. Mr. Taubman, who has denied wrongdoing, has not been charged.
On Jan. 5, a federal judge postponed Ms. Brooks's sentencing. She faces up to three years in prison and a fine of at least $350,000.
Also in January, Ms. Brooks, 50 years old, agreed to forfeit stock options valued at about $10 million.
WASHINGTON (AP) [June 12, 2000] - Workers who say their employers illegally discriminated against them can win lawsuits, or at least get their accusations to a jury, without direct evidence of intentional bias, the Supreme Court ruled Monday.
The court's unanimous decision in an age-bias dispute from Mississippi could carry profound practical importance as well for lawsuits nationwide that charge employment discrimination based on race, sex and physical disabilities.
The ruling was a huge setback for employers because some federal appeals courts routinely had dismissed lawsuits that lacked ``smoking gun'' evidence of employers' discriminatory intent.
Monday's decision said circumstantial evidence often is enough to sue employers successfully.
Employer organizations were disappointed.
``The bottom line is ... it may be tougher to get cases out of the hands of the jury,'' said Peter Petesch, a lawyer for the Society for Human Resource Management. ``In some jurisdictions, we're going to see more litigation ... which lasts longer, even for employers who did nothing wrong,'' he said.
But Thomas Osborne, an AARP lawyer, praised the decision as a victory for the some 12 million over-50 workers who belong to his organization because it ``says employers no longer can lie about their personnel decisions and get away with it.''
``The playing field is no longer slanted toward employers,'' Osborne said.
In a series of employment-bias decisions, the nation's highest court has imposed various requirements on employees who say they were treated illegally. They must show they were subjected to adverse treatment and that the employer's asserted reason for such treatment was phony.
But federal appeals courts have disagreed on a key point: whether employees who discredit an employer's stated reason must also offer proof of a discriminatory motive. Not always, the Supreme Court said Monday.
Justice Sandra Day O'Connor wrote that a federal appeals court wrongly relied on ``the premise that a plaintiff must always introduce additional, independent evidence of discrimination.''
``Proof that the defendant's explanation is unworthy of credence is simply one form of circumstantial evidence that is probative of intentional discrimination, and it may be quite persuasive,'' she said. ``In appropriate circumstances, the trier of fact can reasonably infer form the falsity of the explanation that the employer is dissembling to cover up a discriminatory purpose.''
O'Connor said employees will not always be entitled to win a job-bias lawsuit after showing that an employer's explanation for their treatment was false. But she ruled that it was enough in the case of a Mississippi man who said age discrimination cost him his supervisory job at a toilet-seat manufacturing plant.
Roger Reeves sued Sanderson Plumbing Products of Columbus, Miss., after he was fired in 1995 from his job as a hinge-department supervisor in the plant. Reeves, then 57, had worked at the plant for 40 years.
His lawsuit invoked the federal Age Discrimination in Employment Act, and a jury awarded him $70,000 in damages and $28,490 in lost pay.
But the 5th U.S. Circuit Court of Appeals threw out that award after ruling that Reeves had not offered enough proof of illegal age bias.
Reeves had been required to prove he was over 40 and therefore protected by the federal law, that he had been fired and replaced with someone younger. Such evidence amounted to what courts call a ``prima facie'' showing of discrimination.
Sanderson Plumbing then was required to offer a legitimate, nondiscriminatory reason for the firing. Once it did, the burden shifted back to Reeves to show that the stated reason was false.
He also pointed to derogatory comments made about his age by a supervisor.
Company officials said Reeves had been fired for falsifying time records but he showed that he had not.
The jury apparently concluded that he succeeded in proving bias, but the appeals court said Reeves had to also offer proof that the company's decision was motivated by age bias.
Monday's decision said the appeals court was wrong about that, and reinstated the jury's verdict.
On the Net: For the decision in Reeves v. Sanderson Plumbing, 99-536: http://www.supremecourtus.gov
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Aaron P. Morris is an attorney with The Morris Law Firm, located in Costa Mesa, California. He can be reached at (714) 546-2388, or:
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