President and Asphalt Paving Company Plead Guilty to Bid Rigging

Today, a Michigan business and its president admitted their involvement in two distinct schemes to rig tenders for contracts for asphalt paving services in Michigan.

According to court records submitted to the U.S. District Court in Detroit, the president of Clarkston-based F. Allied Construction Company Inc. (Allied) and two asphalt paving companies as well as their employees colluded to rig bids in favor of each other. From July 2017 to May 2021, and from July 2017 to June 2019, Allied and Foster, respectively, took part in the two plots.

The co-conspirators coordinated their offer prices to ensure that the chosen losing business would purposefully submit non-competitive bids. The co-conspirators previously agreed among themselves who would get the business, but the bids provided buyers the sense of competition.

Deputy Assistant Attorney General Manish Kumar of the Justice Department’s Antitrust Division stated that “these guilty pleas demonstrate our commitment to protecting Americans from schemes that undermine competition in the transportation infrastructure sector.” “The division will continue to seek justice along with our law enforcement partners when corporations and their leaders deprive consumers of fair and open competition.”

“The additional judicial actions taken to thwart this bid-rigging scheme demonstrate our commitment to working with our law enforcement and prosecutorial partners to investigate anticompetitive practices in the transportation industry,” said Special Agent in Charge Andrea M. Kropf of the Department of Transportation Office of the Inspector General (DOT-OIG), Midwestern Region. “These plea deals ought to be a clear signal that dishonest and deceptive behavior won’t be tolerated.”

Executive Special Agent in Charge Kenneth Cleevely of the U.S. Postal Service Office of Inspector General (USPS-OIG) stated that “activities related to bid-rigging and collusion do not promote an environment conducive to open competition which harms the consumer.” “The guilty pleas in this case represent a victory for all law enforcement agencies who investigate those who engage in this type of harmful behavior to ensure that justice is served,” said the prosecutor.

In regards to two counts of breaking Section One of the Sherman Act, Allied and Foster both entered guilty pleas. The maximum punishment for an individual is ten years in prison and a fine of $1 million. The maximum criminal fine for corporations is $100 million.If either amount exceeds the statutory maximum fine, the fine may be enhanced to equal twice the gain attributable to the crime or twice the loss experienced by the victims. After taking into account the U.S. Sentencing Guidelines and other legal considerations, a federal district court judge will decide on any sentence.

As a result of an ongoing federal antitrust investigation into bid rigging and other anticompetitive behavior in the asphalt paving services industry being conducted by the Antitrust Division’s Chicago Office, DOT-OIG, and USPS-OIG, Allied is the first business and Foster is the second person to enter a guilty plea.
Contact the Antitrust Division’s Complaint Center at 888-647-3258 or go to www.justice.gov/atr/report-violations if you have any information about this investigation.