GALVESTON — The Port of Galveston has sued a Swedish maker of marine fenders, buoys and plastic pilings, its subsidiaries and other companies claiming they conspired to fix prices of, and rig bids on, materials used in construction projects.
The Port of Galveston, the Port of New Orleans and Houston-based OSG Lightering Services filed the class-action lawsuit against Trelleborg AB and the other companies March 30 in a California federal court.
The case arises from a whistleblower lawsuit filed in 2005 by an executive of a Trelleborg competitor, according to attorneys. That litigation resulted in a $15.4 million settlement negotiated by the U.S. Department of Justice, which intervened in the case along with the states of California and Florida. Trelleborg and its subsidiaries agreed to pay $14 million of that, according to the U.S. attorney’s office.
That whistleblower lawsuit asserted Trelleborg and four subsidiaries conspired to submit rigged bids, fix prices and allocate market shares on marine fenders and plastic pilings purchased by the U.S. Navy and other federal departments and agencies from June 2000 until August 2005.
Marine fenders are used as cushions between ships and structures such as docks, piers and other ships. Plastic marine pilings are used as substitutes for traditional wood timbers.
The whistleblower lawsuit also alleged Frank March, of Seviervile, Tenn., and two Virginia corporations he formerly controlled — SHI Inc. and SII Inc. — participated in the conspiracy with Trelleborg. March has paid $1 million to resolve the claims, according to court documents.
The whistleblower lawsuit also claims that between about 1999 and May 2007, Bridgestone Corp. and Bridgestone Industrial Products America; the Yokohama Rubber Co. Ltd.; Dunlop Oil & Marine Ltd., related companies and Trelleborg conspired to submit rigged bids, fix prices and allocate markets on marine hoses purchased by various federal agencies. Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities.
Trelleborg, March, Bridgestone, Yokohama and Dunlop agreed to settlements without admitting wrongdoings, according to court documents.
The justice department’s antitrust division conducted a parallel criminal investigation of the marine products industry, which has resulted in criminal convictions of nearly two dozen corporations and individuals and in millions of dollars in fines, according to court filings.
But as companies paid fines, the ports of Galveston, New Orleans and others have not received any restitution, said attorney Craig Eiland, who is representing the Port of Galveston in the complaint filed by New York law firm Labaton Sucharow LLP.
“None of the ports have received any money,” Eiland said.
The Port of Galveston claims the conspiracy to inflate prices on marine materials cost it more than $100,000 from 2002 to 2006.
