A senior executive of a Michigan asphalt paving company pleaded guilty last Thursday in the U.S. District Court in Detroit for his role in two separate conspiracies to rig bids for asphalt paving services contracts in the State of Michigan.
According to court documents filed in the case, Kevin Shell, vice president of Estimating for Clarkston-based F. Allied Construction Company Inc., conspired with two unnamed asphalt paving companies and their employees to rig bids in each other’s favor. Shell participated in the two conspiracies from June 2013 through June 2019, and from July 2017 through May 2021, respectively. The two conspiracies operated in much the same way: the co-conspirators coordinated each other’s bid prices so that the agreed-upon losing company would submit intentionally non-competitive bids. These bids gave customers the false impression of competition when, in fact, the co-conspirators had already decided among themselves who would win the contracts.
“Asphalt paving is fundamental to our transportation infrastructure,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Our economic vitality depends on a fair and competitive bidding process to construct, and maintain, America’s infrastructure. The division will continue to work with our law enforcement partners to hold executives accountable for corrupting that process.”
“The U.S. Department of Transportation Office of Inspector General (DOT-OIG) is committed to ensuring that any activity related to bid rigging involving transportation projects in the State of Michigan, or elsewhere, is identified and investigated,” said Special Agent-in-Charge Andrea M. Kropf of DOT-OIG, Midwestern Region. “Along with our law enforcement and prosecutorial colleagues, we will continue to use every tool at our disposal to hold these offenders accountable for their crimes and restore equity to the bidding process.”
“The Department of Justice’s Antitrust Division, along with our other federal law enforcement partners, secured a victory with today’s guilty plea in our fight against bid-rigging and collusion,” said Executive Special Agent in Charge Kenneth Cleevely of the U.S. Postal Service Office of Inspector General (USPS-OIG). “The USPS-OIG will vigorously investigate those who would engage in harmful anticompetitive practices, and we continue to ask for the public’s assistance in identifying and reporting those engaged in this type of activity.”
Shell pleaded guilty to two counts of violating Section One of the Sherman Act. The maximum penalty for individuals is 10 years in prison and a $1 million criminal fine. The maximum penalty for corporations is a $100 million criminal fine. The 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 amount is greater than the statutory maximum fine. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Last Thursday’s guilty plea results from an ongoing federal antitrust investigation into bid rigging and other anticompetitive conduct in the asphalt paving services industry being conducted by the Antitrust Division’s Chicago Office and the Offices of Inspectors General for the U.S. Department of Transportation and U.S. Postal Service.
Anyone with information in connection with this investigation should contact the Antitrust Division’s Complaint Center at 888-647-3258, or visit www.justice.gov/atr/report-violations.
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