Subsidiaries of Swedish Company, Trelleborg AB, Agree to Plead Guilty and Pay $11 Million in Criminal Fines

WASHINGTON — Two subsidiaries of the Swedish company Trelleborg AB, one based in Virginia and the other in France, have agreed to plead guilty and pay a total of $11 million in criminal fines for their participation in separate conspiracies affecting the sales of marine products sold in the United States and elsewhere, the Department of Justice announced today. A two-count felony charge was filed today in U.S. District Court in Norfolk, Va., against Virginia Harbor Services Inc., formerly known as Trelleborg Engineered Products Inc. (VHS/TEPI), a manufacturer of foam-filled marine fenders, buoys and plastic marine pilings headquartered in Clearbrook, Va. According to the charges, VHS/TEPI participated in a conspiracy between December 2002 and August 2005 to allocate customers and rig bids for contracts to sell foam-filled marine fenders and buoys, and also participated in a separate conspiracy between December 2002 and May 2003 to allocate customers and rig bids for contracts to sell plastic marine pilings. Under the terms of the plea agreement, which is subject to court approval, VHS/TEPI has agreed to pay a $7.5 million criminal fine and to cooperate fully in the Department’s ongoing antitrust investigation. To date, six individuals and two corporations have pleaded guilty or agreed to plead guilty in the Antitrust Division’s ongoing investigation of fraud and collusion in the marine fenders and pilings industries. Foam-filled marine fenders are used as a cushion between ships and either fixed structures, such as docks or piers, or floating structures, such as other ships. Foam-filled buoys are used in a variety of applications, including as channel markers and navigational aids. Plastic marine pilings are substitutes for traditional wood timber pilings and are often used in port and pier construction projects in conjunction with foam-filled fenders. In addition, a one-count felony charge was filed today in U.S. District Court in Fort Lauderdale, Fla., against Trelleborg Industrie S.A.S. (TISAS), a manufacturer of marine hose headquartered in Clermont-Ferrand, France. TISAS is charged with participating in a conspiracy from at least as early as 1999 and continuing until as late as May 2, 2007, to allocate market shares, fix prices and rig bids for contracts to sell marine hose to purchasers in the United States and elsewhere. Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities. Under the terms of the plea agreement, which is subject to court approval, TISAS has agreed to pay a $3.5 million criminal fine and to cooperate fully in the Department’s ongoing antitrust investigation. To date, three corporations have pleaded guilty or agreed to plead guilty in the Antitrust Division’s ongoing investigation in the marine hose industry. Twelve individuals have also been charged to date, nine of whom have pleaded guilty. "The cases filed today follow the prosecution of numerous other participants in these worldwide conspiracies to inflate the price of marine products critical to both the military and to industry," said Scott D. Hammond, Acting Assistant Attorney General in charge of the Department’s Antitrust Division. "Those who harm U.S. purchasers by rigging bids will pay the price through stiff fines and jail sentences." "Price fixing and bid rigging are serious crimes that drain resources from the Department of Defense and the American taxpayer. The Defense Criminal Investigative Service takes very seriously all violations of U.S. antitrust laws that affect products and services procured for our soldiers, sailors, airmen and Marines. DCIS aggressively investigates those who seek to cheat the DOD and the public by conspiring to suppress competition," said Sharon Woods, Director, DCIS. Five former executives of TISAS and VHS/TEPI previously pleaded guilty to participating in the conspiracies charged today. Former VHS/TEPI president Robert B. Taylor was sentenced in January 2008 to serve