Kemp & Associates: The Rival Got Paid to Stop Competing

In the Kemp Associates heir location antitrust case, the company pleaded guilty to dividing customers with a competing firm. When both firms contacted the same unsigned heir, the second firm stopped competing and received a share of the fees the first firm collected. The heir lost a competing provider. The provider that stepped aside still got paid.

Kemp & Associates was a Salt Lake City heir-location services company. The Justice Department’s criminal case concerned an agreement running from 1999 to 2014. For someone inside the business, its mechanics are concrete: who contacted an heir first, who stopped pursuing the business, and where the eventual fee went.

How Heir Location Services Make Their Money

Heir-location firms find people who may be entitled to an inheritance from someone who died without a will. They then contract with those people to help secure the inheritance in exchange for a fee. That is the business the Justice Department described in its August 17, 2016 charging announcement.

Kemp and its competitor sought contingency-fee contracts. The potential heir was the customer, and the competition concerned who would secure that customer’s business. The arrangement kicked in when rival firms reached the same person before that person had signed with either firm. At that point, the heir still had a choice to make.

The estate matters because the arrangement reached beyond the person who first attracted both firms’ attention. The Justice Department’s account of the guilty pleas says the second firm withdrew from competing for that heir and certain other unsigned heirs to the same estate. A contact with one person could therefore determine which firm would pursue additional customers.

That makes the estate file more revealing than a customer name alone. It connects the overlapping solicitations, the heirs covered by the arrangement and the fees that followed.

Customer Allocation Took Away the Second Offer

Customer allocation in the Kemp criminal case worked by paying a rival to surrender a competitive opportunity.

The agreement gave the second firm a financial reason to stop trying to win. Its return came from the first firm’s success with the customer. The benefit the heir should have received from rival firms pursuing the same business was turned into a benefit the firms shared between themselves.

The indictment alleged that the firms documented allocations and fee splits estate by estate. That connects the arrangement to particular business, rather than leaving it as a general understanding between executives. For an insider, the revealing connection is between an abandoned solicitation and the payment later made to the firm that abandoned it.

The same loss of an independent choice appears in a different service business. Under its deferred prosecution agreement, Florida Cancer Specialists admitted conspiring to allocate cancer treatments. Chemotherapy went to that company and radiation treatment to another oncology practice. Kemp’s arrangement divided potential customers. The oncology arrangement divided services. Both show how businesses can remove a competing option by agreeing which opportunities to leave to each other.

The Dismissal Was Reversed Before the Guilty Pleas

The dismissal in the Kemp heir location case was reversed, and the company and its co-owner later pleaded guilty.

In August 2017, the district court dismissed the charge on the ground that the prosecution came too late. The Tenth Circuit reversed that dismissal in October 2018.

The district court then ruled in February 2019 that the alleged agreement to divide customers would be illegal in itself if proved. On July 10, 2019, the Justice Department announced the guilty pleas.

The Co-Owner’s Part in the Fee-Sharing Agreement

In announcing the guilty pleas, the Justice Department said that Kemp’s co-owner participated in the same customer-allocation agreement. The department had identified him as the company’s vice president when it announced the indictment. It later reported that both he and the company pleaded guilty.

The department’s description of the payment explains what their agreement bought:

The management decision and the payment trail belong in the same account. An estate researcher may see competing solicitations stop. An accounts-payable employee may see the eventual fee split. Connecting those observations to the people who agreed on the allocation explains why the rival received money.

What Can Help the Antitrust Division Understand My Report?

Contact dates, competing fee offers and split-payment records can connect an heir-location allocation agreement to the estates it affected. We work with insiders to understand how those records fit together and what their own work allowed them to see.

A contact chronology can show the overlap between firms approaching the same heir. The fee offers show what business the firms were pursuing. Allocation records identify the heirs assigned under the arrangement, while payments connect the customer decision to the rival’s financial return.

In a business organized around finding heirs and securing contracts, that knowledge can explain why a stopped solicitation and a later payment belong together.

Could a Customer-Allocation Case Pay a Whistleblower Reward?

Our whistleblower experts can assess whether the customer allocation you know about could support a reward claim. We examine your information under the Antitrust Division and Postal Service reward program.

We assess the available evidence and your role with antitrust whistleblower lawyers who understand customer-allocation cases. Questions about participation or confidentiality belong in that conversation.

Where collusion involves false claims for government money, we assess the False Claims Act connection. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Why the Rival Stopped Calling

Tell our whistleblower experts how the heir-location customer was assigned and why the rival received a payment for stepping aside.