Attorneys for the United States

UNITED STATES OF AMERICA,                                      v. YUJI KOMATSU, YOSHIHIKO KATSUYAMA, WAKAO SHINODA, and HITOSHI HAYASHI,                                Defendants.

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No. CR 01-0019 PJH INDICTMENT VIOLATION: Title 15, United States Code, Section 1 (Price Fixing, Volume Allocation) San Francisco Venue Filed: January 23, 2001

The Grand Jury charges as follows:

1. The following individuals are hereby indicted and made defendants on the charge stated below:

1. YUJI KOMATSU;

2. YOSHIHIKO KATSUYAMA;

3. WAKAO SHINODA; and

4. HITOSHI HAYASHI.

2. Beginning in or about 1979 and continuing into 1996, the exact dates being unknown to the Grand Jury, the defendants and their coconspirators entered into and engaged in a combination and conspiracy to suppress and eliminate competition by fixing the prices and allocating the volumes of sorbates to be sold in the United States and elsewhere. The combination and conspiracy engaged in by the defendants and their coconspirators was an unreasonable restraint of interstate and foreign trade and commerce in violation of Section 1 of the Sherman Act (15 U.S.C. § 1).

3. The charged combination and conspiracy consisted of a continuing agreement, understanding, and concert of action among the defendants and their coconspirators, the substantial terms of which were:

1. to agree to fix and maintain prices and to coordinate price increases for sorbates to be sold in the United States and elsewhere; and

2. to agree to allocate among major sorbates producers the volumes of sorbates to be sold in the United States and elsewhere.

4. For the purpose of forming and carrying out the charged combination and conspiracy, the defendants and their coconspirators did those things that they combined and conspired to do, including, among other things:

1. Meetings, Telephone Conversations, and Discussions

   1. participating in meetings among major sorbates producers, which were held at least twice a year, to discuss the prices and volumes of sorbates to be sold in the United States and elsewhere. The meetings were held in various locations throughout the world, including: Salzburg, Austria; Vienna, Austria; Prague, Czechoslovakia; Helsinki, Finland; Athens, Greece; Budapest, Hungary; Tokyo, Japan; Warsaw, Poland; Lisbon, Portugal; Stockholm, Sweden; Interlaken, Switzerland; and Zurich, Switzerland;

   2. participating in telephone conversations to discuss the prices and volumes of sorbates to be sold in the United States and elsewhere; and

   3. participating in other discussions regarding the prices and volumes of sorbates to be sold in the United States and elsewhere.

2. Agreement to Fix Prices
   1. agreeing during the meetings, telephone conversations, and discussions to charge prices at certain levels, known as "target prices," and otherwise to increase or maintain target prices of sorbates to be sold in four regions of the world: the United States, Europe, the Americas (including Canada, Mexico, and South America), and the region called rest of the world (including Asia) ("the four world regions");

   2. agreeing that the target prices for sorbates to be sold in the United States would be the final, delivered prices charged to the end user;

   3. agreeing to establish different target prices in the United States based on amounts purchased by the end users, including a separate target price for the largest purchasers, known as the "ultrabigs";

   4. agreeing to direct the corporate conspirators' U.S. subsidiaries and trading companies (collectively referred to as "intermediate sellers") to announce new target prices for U.S. end users in the trade magazine Chemical Market Reporter ("CMR"), and agreeing on the timing and the order in which the intermediate sellers would announce new target prices in the CMR;

   5. directing the intermediate sellers to issue pricing announcements in the CMR in accordance with the target-price agreements;

   6. directing the intermediate sellers to charge certain prices and quote certain bid prices in the United States to ensure that the prices charged and the bid prices quoted to end users were in accordance with the target-price agreements;

   7. causing sorbates prices to end users and customers to be raised or maintained in the United States and elsewhere;

   8. accepting payment for the supply of sorbates sold at collusive, noncompetitive prices to end users and customers in the United States and elsewhere; and

   9. agreeing to continue to fix sorbates prices from year to year.

3. Agreement to Allocate Sales Volumes
   1. agreeing during the meetings, telephone conversations, and discussions to allocate among the corporate conspirators the volumes of sorbates to be sold in the four world regions;

   2. allocating each corporate conspirator's volumes of sorbates to be sold in each of the four world regions, using an agreed-upon formula to calculate each corporate conspirator's allocated share by region;

   3. agreeing to exchange, on a regular basis, the actual volumes of sorbates sold by each corporate conspirator in the four world regions, for the purpose of monitoring and enforcing the volume-allocation agreements; and

   4. agreeing to continue to allocate sales volumes of sorbates from year to year.

4. Monitoring and Enforcing the Agreements

   1. participating in meetings, telephone conversations, and discussions to discuss the actual prices and volumes of sorbates sold by each corporate conspirator in each of the four world regions for the purpose of monitoring and enforcing adherence to the target-price and volume-allocation agreements;

   2. discussing and agreeing to certain bid prices to be quoted to end users in the United States to ensure that the bid prices would be in accordance with the target-price agreements; and

   3. exchanging the actual volumes of sorbates sold by each corporate conspirator in each of the four regions of the world to ensure that the sorbates sales of each corporate conspirator did not exceed its allocated sales volume.

5. Concealing the Conspiracy

   1. agreeing at the meetings to stagger the order and the timing of price announcements in the CMR to avoid detection by U.S. antitrust authorities;

   2. agreeing at the meetings to avoid holding meetings in certain countries, including the United States and member countries of the European Commission, to avoid detection by those countries' antitrust authorities;

   3. agreeing at the meetings on the need to dispose of notes memorializing the meetings or other documents referring to the meetings or other activities of the conspiracy; and

   4. attempting to conceal the conspiracy and conspiratorial contacts through various other means.

5. Defendant YUJI KOMATSU is a resident and citizen of Japan. During part of the period covered by this Indictment, defendant YUJI KOMATSU was the General Manager of the Sales Department at Ueno Fine Chemicals Industry, Ltd. ("Ueno") and a Member of Ueno's Board of Directors. During the period covered by this Indictment, Ueno was a Japanese company that engaged in the business of producing sorbates and, through its trading company, selling sorbates to customers in the United States.

6. Defendant YOSHIHIKO KATSUYAMA is a resident and citizen of Japan. During part of the period covered by this Indictment, defendant YOSHIHIKO KATSUYAMA was the Deputy General Manager of the Sales Department at Ueno.

7. Defendant WAKAO SHINODA is a resident and citizen of Japan. During part of the period covered by this Indictment, defendant WAKAO SHINODA was the General Manager of Ueno's U.S. subsidiary, Ueno Fine Chemicals Industry (U.S.A.) Inc.

8. Defendant HITOSHI HAYASHI is a resident and citizen of Japan. During part of the period covered by this Indictment, defendant HITOSHI HAYASHI was a salesman for the Organic Chemicals Division of Daicel Chemical Industries Ltd. ("Daicel"). During the period covered by this Indictment, Daicel was a Japanese company that engaged in the business of producing sorbates and, through its trading company, selling sorbates to customers in the United States and elsewhere.

9. Various corporations and individuals, not made defendants in this Indictment, participated as coconspirators in the offense charged in this Indictment and performed acts and made statements in furtherance of it.

10. Whenever in this Indictment reference is made to any act, deed, or transaction of any corporation, the allegation means that the corporation engaged in the act, deed, or transaction by or through its officers, directors, employees, agents, or other representatives while they were actively engaged in the management, direction, control, or transaction of its business or affairs.

11. Sorbates are chemical preservatives used primarily as mold inhibitors in high-moisture and high-sugar food products. All references to sorbates in this Indictment include the products potassium sorbate and sorbic acid.

12. During the period covered by this Indictment, the defendants and their coconspirators sold and distributed sorbates, and caused the sale and distribution of sorbates, in a continuous and uninterrupted flow of interstate and foreign trade and commerce to customers located in states or countries other than the states or countries in which the defendants and their coconspirators produced sorbates.

13. The business activities of the defendants and their coconspirators that are the subject of this Indictment were within the flow of, and substantially affected, interstate and foreign trade and commerce.

14. The combination and conspiracy charged in this Indictment was carried out, in part, in the Northern District of California within the five years preceding the return of this Indictment.

ALL IN VIOLATION OF TITLE 15, UNITED STATES CODE, SECTION 1.

A TRUE BILL

_______________/s/________________ FOREPERSON _______________/s/________________ A. Douglas Melamed Acting Assistant Attorney General _______________/s/________________ James M. Griffin Deputy Assistant Attorney General _______________/s/________________ Scott D. Hammond Director of Criminal Enforcement United States Department of Justice Antitrust Division _______________/s/________________ Robert S. Mueller, III United States Attorney Northern District of California

_______________/s/________________ Christopher S Crook Chief, San Francisco Office _______________/s/________________ Marc Siegel Michael L. Scott Stuart J. Seaborn Attorneys U.S. Department of Justice Antitrust Division 450 Golden Gate Ave. Box 36046, Room 10-0101 San Francisco, CA 94102 (415) 436-6660