Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Asphalt paving company to pay $6.5 million fine for bid rigging, (Aug 16, 2024)
Law Firms Mentioned:Mogill, Posner & Cohen, Attorneys at Law
Organizations Mentioned:Asphalt Specialists LLC | U.S. Department of Justice | U.S. Postal Service
By Thomas K. Lauletta, J.D.
The sentencing follows several pleas and sentences stemming from an investigation of bid-rigging of asphalt paving contracts in the State of Michigan.
The Department of Justice Antitrust Division announced Asphalt Specialist LLC was sentenced to pay a $6.5 million criminal fine in a suit filed by the antitrust agency. The Pontiac, Michigan-based Asphalt Specialists plead guilty on January 30, taking full responsibility for its wrongful conduct. The Antitrust Division, assisted by the Department of Transportation and the U.S. Postal Service, has been probing bid-rigging in Michigan (U.S. v. Asphalt Specialists LLC, No. 2:23-cr-20700-GAD-DRG (E.D. Mich. Aug. 15, 2024)).
Based on court documents and proceedings, Asphalt Specialists participated in a conspiracy with Al’s Asphalt Paving Company Inc. and its employees (Al’s Asphalt) from March 2013 through November 2018 to suppress and eliminate competition in violation of the Sherman Act. Asphalt Specialists also participated in a separate conspiracy with F. Allied Construction Company Inc. (Allied) and its employees from July 2017 through May 2021.
In furtherance of the respective conspiracies, the Defendant’s officers and employees engaged in conversations and communications with Al’s Asphalt and Allied co-conspirators about which contracts each company wanted to win and agreed to rig bids in each other’s favor. The co-conspirators shared price-related information, including bid submissions, so that the agreed-upon losing co-conspirator could craft a higher-priced non-competitive bid, which it then submitted to the customer. As a result, the agreed-upon winning company would indeed get the contract. Asphalt Specialists, Al’s Asphalt, and Allied each provided and accepted payments for asphalt paving services under contracts obtained through this collusive and non-competitive process.
The Justice Department alleged that Asphalt Specialists won more than $23.4 million in asphalt paving services contracts by participating in extensive bid-rigging conspiracies that affected dozens of projects and victims.
Deputy Assistant Attorney General Manish Kumar of the Justice Department’s Antitrust Division stated that “When companies choose to cheat rather than compete, they can expect to pay substantial, punitive criminal fines. The Antitrust Division and its law enforcement partners will not hesitate in our shared mission to ensure those who violate the antitrust laws do not benefit from their crimes, particularly when those crimes affect critical infrastructure for our country.”
Related charges. Asphalt Specialists is one of three companies that have been charged as part of an ongoing federal antitrust investigation into bid rigging and other anticompetitive conduct in the asphalt paving services industry. Al’s Asphalt pleaded guilty and was sentenced to pay a fine of $795,661.81 on July 31. Allied also pleaded guilty and is awaiting sentencing. Six individuals also have been charged as part of the investigation.
On July 30, 2024, the Antitrust Division filed a criminal information against David A. Coppola, vice-president and part-owner of Al’s Asphalt Paving Company, Inc., charging him with conspiracy. The charges followed Al’s Asphalt’s President and co-owner, Edward D. Swanson’s January 4, 2024 guilty plea in a separate bid-rigging case involving the same alleged bid-rigging conspiracies. (U.S. v. Coppola, No. 2:24-cr-20404-DML-EAS (E.D. Mich. July 30, 2024)).
In August 2023, the F. Allied Construction Company Inc. of Clarkston, Michigan (Allied), its president Andrew Foster, and vice-president Kevin Shell each pleaded guilty to participating in two separate bid-rigging conspiracies in violation of Sherman Act. In October 2023, Daniel Israel, who had been the president of Pontiac, Michigan-based Asphalt Specialists, and related entities, likewise pleaded guilty to a single Sherman Act Section 1 violation.
The Case is No. 2:23-cr-20700-GAD-DRG.
Judge: Drain, G.
Attorneys: Michael Loterstein, U.S. Department of Justice, for the U.S. Kenneth M. Mogill (Mogill, Posner & Cohen, Attorneys at Law) for Asphalt Specialists LLC.
Companies: Asphalt Specialists LLC
News: Antitrust AntitrustDivisionNews MichiganNews