Three United States companies that provide foam for automobile seats pleaded guilty to price fixing last Friday and became the latest suppliers charged in a probe into the auto parts industry. The three firms charged are Woodbridge Foam Fabricating Inc, Riverside Seat Co. and SW Foam LLC. These companies have agreed to pay a total of $6,148,800 and will cooperate with the department’s ongoing investigation.
The Justice Department reports that the firms pleaded guilty in United States District Court in Brooklyn and admitting to fixing prices from at least April 2008 through June 2009. According to the charge, the companies and their co-conspirators discussed polyurethane foam prices and agreed to coordinate the timing and amount of increases to customers. The three manufacturers are charged with price fixing in violation of the Sherman Act which carries a maximum penalty of a $100 million criminal fine for corporations.
“Today’s charges demonstrate the Antitrust Division’s commitment to holding companies accountable for conspiracies that affect components used in products that consumers rely on every day,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The Antitrust Division will vigorously prosecute companies that engage in price-fixing schemes that subvert normal competitive processes and defraud American consumers and businesses.”
To date, 34 people have been charged in this investigation and twenty-four have pleaded guilty or agreed to plead guilty. Additionally, 27 companies have pleaded guilty or agreed to plead guilty and have agreed to pay more than $2.3 billion in total fines.
The government estimates that over 25 million cars sold in the United States since 2003 have been affected by price fixing and the victims include major automakers from Detroit and Japan.