SIX JAPANESE FREIGHT FORWARDING COMPANIES AGREE TO PLEAD GUILTY TO CRIMINAL PRICE-FIXING CHARGES

Companies Agree to Pay a Total of $46.8 Million in Criminal Fines

WASHINGTON — Six Japanese freight forwarders have agreed to plead guilty and to pay criminal fines totaling $46.8 million for their roles in a conspiracy to fix certain fees in connection with the provision of freight forwarding services for air cargo shipments from Japan to the United States, the Department of Justice announced today. These are the second round of charges filed as a result of the department's antitrust investigation of the freight forwarding industry.

According to charges filed separately today in U.S. District Court for the District of Columbia, six companies - Kintetsu World Express Inc.; Hankyu Hanshin Express Co. Ltd.; Nippon Express Co. Ltd.; Nissin Corporation; Nishi-Nippon Railroad Co. Ltd.; and Vantec Corporation - engaged in a conspiracy to fix and impose certain freight forwarding service fees, including fuel surcharges and various security fees, charged to customers for services provided in connection with air freight forwarding shipments of cargo shipped by air from Japan to the United States from about September 2002 until at least November 2007.

Under the plea agreements, which are subject to court approval, the six companies have agreed to pay the following criminal fines: Kintetsu World Express, $10,465,677; Hankyu Hanshin Express, $4,522,065; Nippon Express, $21,115,396; Nissin Corporation, $2,644,779; Nishi-Nippon Railroad, $4,673,114; and Vantec Corporation, $3,339,648. Each company has also agreed to cooperate with the department's ongoing antitrust investigation.

"Including today's charges, 12 companies have agreed to plead guilty and nearly $100 million in criminal fines have been obtained as a result of the Antitrust Division's ongoing freight forwarding investigation," said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice's Antitrust Division. "Prosecuting these kinds of global price fixing conspiracies, that are harmful to the economy and consumers, has been and will continue to be a top priority of the Antitrust Division."

Freight forwarders manage the domestic and international delivery of cargo for customers by receiving, packaging, preparing and warehousing cargo freight, arranging for cargo shipment through transportation providers such as air carriers, preparing shipment documentation, and providing related ancillary services.

According to the charges, the companies carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate and impose certain freight forwarding service fees and charges on customers purchasing freight forwarding services for cargo shipped by air from Japan to the United States. The department said that the companies levied freight forwarding service fees in accordance with the agreements reached and engaged in meetings and discussions for the purpose of monitoring and enforcing adherence to the agreed-upon freight forwarding service fees.

As a result of the department's investigation into the freight forwarding industry, on Sept. 30, 2010, six international freight forwarders - EGL Inc.; Kühne + Nagel International AG; Geologistics International Management (Bermuda) Limited; Panalpina World Transport (Holding) Ltd.; Schenker AG; and BAX Global Inc. - agreed to plead guilty and to pay criminal fines totaling $50.27 million for their roles in several conspiracies to impose certain charges or fees on customers purchasing international freight forwarding services for cargo freight destined for air shipment to the United States during various periods between 2002 and 2007.

Each company is charged with price fixing in violation of the Sherman Act, which carries a maximum $100 million fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today's charges are the result of a joint investigation into the freight forwarding industry being conducted by the Antitrust Division's National Criminal Enforcement Section, the FBI's Washington Field Office and the Department of Commerce's Office of Inspector General. Anyone with information concerning the price fixing or other anticompetitive conduct in the freight forwarding industry is urged to call the Antitrust Division's National Criminal Enforcement Section at 202-307-6694 or visit www.justice.gov/atr/contract/newcase.htm or call the FBI's Washington Field Office at 202-278-2000.

Bridgestone Corporation Agrees to Plead Guilty to Participating in Conspiracies to Rig Bids and Bribe Foreign Government Officials

Company Agrees to Pay $28 Million Criminal Fine

WASHINGTON — Bridgestone Corporation has agreed to plead guilty and to pay a $28 million criminal fine for its role in conspiracies to rig bids and to make corrupt payments to foreign government officials in Latin America related to the sale of marine hose and other industrial products manufactured by the company and sold throughout the world, announced Acting Assistant Attorney General Sharis A. Pozen of the Department of Justice’s Antitrust Division and Assistant Attorney General Lanny A. Breuer of the Department of Justice’s Criminal Division.

A two-count criminal information was filed today in U.S. District Court in Houston against Bridgestone, a Tokyo-headquartered manufacturer of marine hose and other industrial products, charging the company with conspiring to violate the Sherman Act and the Foreign Corrupt Practices Act (FCPA).  According to the court document, Bridgestone conspired to rig bids, fix prices and allocate market shares of marine hose in the United States and elsewhere and, separately, conspired to make corrupt payments to government officials in various Latin American countries to obtain and retain business.  The department said Bridgestone participated in the conspiracies from as early as January 1999, and continuing until as late as May 2007.

Under the terms of the plea agreement, which is subject to court approval, Bridgestone has also agreed to cooperate fully in the department’s ongoing investigations.

Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities.  During the bid rigging conspiracy, according to the court document, the cartel affected prices for hundreds of millions of dollars worth of marine hose and related products sold worldwide.

According to the antitrust charge, Bridgestone and its co-conspirators agreed to allocate shares of the marine hose market and to use a price list for marine hose in order to implement the conspiracy.  Bridgestone and its co-conspirators agreed not to compete for one another’s customers either by not submitting prices or bids, or by submitting intentionally high prices or bids to certain customers.  As part of the conspiracy, Bridgestone and its co-conspirators provided information received from customers in the United States and elsewhere about upcoming marine hose jobs to a co-conspirator who served as the coordinator of the conspiracy.  Bridgestone received marine hose prices for customers in the United States and elsewhere from the coordinator of the conspiracy and then sold the marine hose to those customers at collusive and noncompetitive prices and then concealed the conspiracy through various means, including code names, private email accounts and telephone numbers.

The department also charged that, in order to secure sales of marine hose in Latin America, Bridgestone authorized and approved corrupt payments to foreign government officials employed at state-owned entities.  Bridgestone’s local sales agents agreed to pay employees of state-owned customers a percentage of the total value of proposed sales.  When Bridgestone secured a sale, it would pay the local sales agent a “commission” consisting of not only the local sales agent’s actual commission but also the corrupt payments to be made to employees of the state-owned customer.  The local sales agent then was responsible for passing the agreed-upon corrupt payment to the employees of the customer.

Bridgestone is the fifth company to be charged in the Antitrust Division’s bid rigging investigation.  To date, nine individuals have been convicted and sentenced to a total of 4,557 days in prison for their involvement in the marine hose conspiracy, including Misao Hioki, the former general manager of Bridgestone’s international engineered products department, who was sentenced to two years in prison on Dec. 10, 2008.  Hioki also pleaded guilty and was sentenced for his role in the FCPA conspiracy.

Bridgestone is charged with conspiring to violate the Sherman Act, which carries a maximum $100 million criminal fine for corporations.  Bridgestone is also charged with conspiring to violate the FCPA, which carries a maximum $500,000 fine for corporations.  The maximum fine for each count may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Under t he plea agreement, the department recognized Bridgestone’s cooperation with the investigations, including conducting a worldwide internal investigation, voluntarily making employees available for interviews, and collecting, analyzing and providing to the department voluminous evidence and information.  In addition, the plea agreement acknowledges Bridgestone’s extensive remediation, including restructuring the relevant part of its business, terminating many of its third-party agents and taking remedial actions with respect to employees responsible for many of the corrupt payments.  Under the terms of the plea agreement, Bridgestone has committed to continuing to enhance its compliance program and internal controls.  As a result of these mitigating factors, the department agreed to recommend a substantially reduced fine.

This case is being prosecuted by the Antitrust Division’s National Criminal Enforcement Section and the Criminal Division’s Fraud Section.  In addition to the Antitrust and Criminal Divisions, the ongoing investigation is being conducted by the Defense Criminal Investigative Service (DCIS) of the Department of Defense’s Office of Inspector General, the U.S. Navy Criminal Investigative Service and the FBI.  Law enforcement agencies from multiple foreign jurisdictions are also investigating or assisting in the ongoing matter.

Anyone with information concerning bid rigging or other anticompetitive conduct in the marine products industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.htm or the Long Beach, Calif., Resident Agency of the DCIS at 562-256-2501.  Anyone with information concerning corrupt payments to foreign officials is urged to e-mail the Criminal Division’s Fraud Section at FCPA.Fraud@usdoj.gov or to call 202-514-7023.  To learn more about the department’s ongoing FCPA enforcement efforts, go to www.justice.gov/criminal/fraud/fcpa.

California Aftermarket Auto Lights Distributor Agrees to Plead Guilty in Price-Fixing Conspiracy

WASHINGTON – A California aftermarket auto lights distributor has agreed to plead guilty today for its participation in a global conspiracy to fix the prices of aftermarket auto lights, the Department of Justice announced.  Aftermarket auto lights are incorporated into an automobile after its original sale, often as repairs following a collision or as accessories and upgrades.

According to a one-count felony charge filed today in U.S. District Court in San Francisco, Sabry Lee (U.S.A.) Inc. conspired with others to suppress and eliminate competition by fixing the prices of aftermarket auto lights.  The department said that Sabry Lee, a U.S. distributor for a Taiwan producer of aftermarket auto lights, participated in the conspiracy from about September 2003 until about September 2005.  Under Sabry Lee’s plea agreement, which is subject to court approval, the company has agreed to pay a $200,000 criminal fine and to assist the department in its ongoing investigation into the aftermarket auto lights industry.

According to the charge, Sabry Lee and co-conspirators participated in a conspiracy in which the participants met and agreed to charge prices of aftermarket auto lights at certain predetermined levels.  According to the court documents, the participants in the conspiracy issued price announcements and price lists in accordance with the agreements reached, and collected and exchanged information on prices and sales of aftermarket auto lights for the purpose of monitoring and enforcing adherence to the agreed-upon prices.  The department said that the conspirators met in Taiwan, the United States and elsewhere for their discussions.

Sabry Lee is the first corporation to be charged in connection with the department’s ongoing investigation into the aftermarket auto lights industry.  Three individuals have also been charged.  Polo Shu-Sheng Hsu, the former president and chief executive officer of a U.S. distributor of aftermarket auto lights, entered his guilty plea on March 29, 2011, and was sentenced to serve 180 days in prison and to pay a $25,000 criminal fine.  Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee, pleaded guilty to his participation in the conspiracy on June 7, 2011.  He is currently scheduled to be sentenced on Dec. 13, 2011.  Homy Hong-Ming Hsu was arrested at Los Angeles International Airport on July 12, 2011, and indicted on July 19, 2011.  Homy Hong-Ming Hsu is the vice chairman and second highest-ranking officer of a Taiwan manufacturer of aftermarket auto lights.

Sabry Lee is charged with violating the Sherman Act, which carries a maximum penalty of a $100 million criminal fine.  The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum fine.

This case is part of an ongoing joint investigation of the Department of Justice Antitrust Division’s San Francisco Office and the FBI in San Francisco.  Anyone with information concerning illegal or anticompetitive conduct in the aftermarket auto lights industry is urged to call the Antitrust Division’s San Francisco Field Office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm.

Iowa Company Pleads Guilty to Participating in Ready-Mix Concrete Price-Fixing and Bid-Rigging Conspiracy

WASHINGTON—An Iowa ready-mix concrete company pleaded guilty today to participating in a price-fixing and bid-rigging conspiracy for the sales of ready-mix concrete, the Department of Justice announced.

According to a one-count felony charge filed on Aug. 15, 2011, in U.S. District Court in Sioux City, Iowa, Great Lakes Concrete Inc., a producer of ready-mix concrete with headquarters in Spencer, Iowa, participated in a conspiracy with another ready-mix concrete company to fix prices and rig bids for ready-mix concrete sold in the northern district of Iowa. The department said the company participated in the conspiracy beginning at least as early as January 2008 and continuing until as late as August 2009.

Ready-mix concrete is a product comprised of cement, aggregate (sand and gravel), water, and other additives. The concrete generally is produced in a concrete plant and is transported by concrete-mixer trucks to work sites, where it is used in various types of construction projects, including buildings and roads.

According to court documents, Kent Robert Stewart, the president of Great Lakes Concrete, participated in the conspiracy by engaging in conversations and reaching agreements regarding the conspirators’ price lists and project bids for ready-mix concrete sold in the Northern District of Iowa. Great Lakes Concrete then accepted payment for those sales at collusive and noncompetitive prices, the department said. On May 24, 2010, Stewart pleaded guilty in U.S. District Court in Sioux City to participating in a conspiracy to fix prices and rig bids of the sale of ready-mix concrete, and, on Feb. 8, 2011, was sentenced to serve a year and a day in prison and to pay a $83,427.09 criminal fine.

Great Lakes Concrete is charged with violating the Sherman Act, which carries a maximum fine of $100 million for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today’s guilty plea arose from an ongoing federal antitrust investigation of the ready-mix concrete industry in Iowa and surrounding states. As a result of the investigation, three individuals have been convicted and sentenced to serve prison time, and, including Great Lakes Concrete, four ready-mix concrete companies have pleaded guilty and are awaiting sentencing.

The investigation is being conducted by the Antitrust Division’s Chicago Field Office, the FBI’s Sioux City Resident Agency and the U.S. Department of Transportation’s Office of the Inspector General, with the assistance of the U.S. Attorney’s Office in Sioux City. Anyone with information concerning bid-rigging, price-fixing or territorial allocation related to the ready-mix concrete industry in Iowa and its surrounding states should contact the Antitrust Division’s Chicago Field Office at 312-353-7530 or visit justice.gov/atr/contact/newcase.htm.

IOWA COMPANY PLEADS GUILTY TO PARTICIPATING IN READY-MIX

WASHINGTON — An Iowa-based company pleaded guilty today to participating in a price-fixing conspiracy for the sales of ready-mix concrete, the Department of Justice announced.

According to a one-count felony charge filed on June 24, 2011, in U.S. District Court in Sioux City, Iowa, VS Holding Co., which formerly operated as Alliance Concrete Inc., a producer of ready-mix concrete with headquarters in Orange City, Iowa, participated in a conspiracy with another ready-mix concrete company to fix prices for ready-mix concrete sold in the northern district of Iowa. The department said the company participated in the conspiracy beginning at least as early as January 2006 and continuing until as late as January 2008.

Ready-mix concrete is a product comprised of cement, aggregate (sand and gravel), water and other additives. The concrete generally is produced in a concrete plant and is transported by concrete-mixer trucks to work sites, where it is used in various types of construction projects, including buildings and roads.

According to the court documents, Steven VandeBrake, the former president of VS Holding Co., participated in the conspiracy by engaging in discussions and reaching agreements regarding the conspirators' prices for ready-mix concrete sold in the northern district of Iowa. VS Holding Co. then accepted payment for those sales at collusive and noncompetitive prices, the department said.

VS Holding Co. is charged with violating the Sherman Act, which carries a maximum fine of $100 million for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today's plea is the result of an ongoing federal antitrust investigation of the ready-mix concrete industry in Iowa and its surrounding states. As a result of the investigation, three individuals have been convicted and sentenced to serve prison time, and, including VS Holding Co., three ready-mix concrete companies have pleaded guilty and are awaiting sentencing.

The investigation is being conducted by the Antitrust Division's Chicago Field Office, the FBI's Sioux City Resident Agency and the Department of Transportation's Office of the Inspector General, with the assistance of the U.S. Attorney's Office in Sioux City. Anyone with information concerning bid rigging, price fixing or territorial allocation related to the ready-mix concrete industry in Iowa and its surrounding states should contact the Antitrust Division's Chicago Field Office at 312-353-7530 or visit justice.gov/atr/contact/newcase.htm.