KEEPING FREE MARKETS FREE
The Case of the Concrete Conspiracy
06/26/06
The
fix was in: for nearly four years, the president
of a ready-mixed concrete company in the Indianapolis
area had brought his competitors together
for a series of secret meetings—in local
hotels and in a horse barn near his home in
the northern suburbs—to collectively
set in the stone the price of their highly
popular product.
During
the meetings, they all agreed to charge the
same high prices, to wipe out or cut back
any discounts, and to collectively enforce
the deal they struck.
Illegal?
You bet. Antitrust laws like the Sherman
Antitrust Act, the Clayton
Act, and the Federal Trade Commission
Act prohibit price fixing, bid rigging, and
unfair mergers and acquisitions. It's economics
101: free markets and fair competition ensure
that businesses keep scrambling to provide
the best products at the best prices…so
consumers keep buying, inflation stays low,
and the economy stays healthy.
In
this case, the conspirators profited handsomely…at
the expense of the many area businesses, suppliers,
state and federal agencies, and consumers
who use ready-mixed concrete—a blend
of cement, sand, gravel, water, and other
additives that's made on demand and shipped
to work sites.
Now,
following an intensive investigation by our
office in Indianapolis
and prosecutors in Chicago and Indiana, many
of these concrete makers are paying the price.
So far, four companies and nine executives
have pled guilty or been charged in the scheme.
Collectively, they've also been fined more
than $30 million—including one fine of
$29.2 million, the largest ever in a domestic
antitrust case.
The
investigation continues. If you have any
information on possible price fixing or anticompetitive
practices in ready mixed concrete industry,
please contact our Indianapolis office at
(317) 639-3301 or the Chicago Field Office
of the U.S. Department of Justice's Antitrust
Division at (312) 353-7530. Or submit
a tip online.
We've
got plenty more antitrust cases going, too.
Here are a few:
