Concrete Company Charged with Rigging Bids, Fixing Prices, and Antirust Law violations
Argos a ready-mix concrete company admits to antitrust violations. Argos employees were engaged in a price fixing scheme by colluding with would be competitors to inflate prices on consumers. The US Attorney’s prosecute these cases to protect consumers, as collusion and bid rigging does not promote open competition which in turns harms the customer.
What is the law?
Three key federal laws regulate antitrust activities:
1. The Sherman Act
The basic antitrust law. The law makes it a criminal act to restrain trade through contract, written agreement, or implied actions.
2. Robinson-Patman Act
This law prohibits price discrimination and interlocking directorates of competing mergers and acquisitions, and exclusive dealing arrangements.
3. The Clayton Act.
Unlike the Sherman Act, this is not a criminal statute. However, this civil statute can be quite punishing as it can order the offender to pay treble damages for its offense.
How did Argos violate the antitrust statute?
Argos coordinated with its competitors to set a certain price for their goods. They conspired by coordinating issuing price increase letters to clients, charging the same amount for certain services, and submit the same bid to customers based on non-competitive prices.
Punishment of the company
The US Attorney’s office and Argos agreed on differed prosecution. As part of the agreement, Argos is required to pay a $20 million dollar criminal penalty, fully cooperate with the Antitrust Division’s ongoing investigation, admit to participating in the criminal conspiracy, and cooperate in the prosecution of others involved in the conspiracy.
Other corporations and employees also charged
Argos wasn’t the first corporation charged and also may not be the last. As part of the investigation several employees from Argos and other concrete companies were also charged. For Argos James Pedrick and Gregory Melton were charged with conspiracy and making false statements. John Melton, Timothy Strickland and Evans Concrete are also charged in this investigation. Evan’s Concrete and the individual defendants are currently awaiting trial.