Two Trelleborg Execs Plead Guilty to Price Fixing Charges

Two executives from Trelleborg Industrie S.A.S in France have pleaded guilty to participating in a marine hose price fixing conspiracy. On November 6 a one-count felony charge was filed in the US District Court in Fort Lauderdale, Florida against Christian Caleca, president of Trelleborg’s Industrial Fluid Systems business unit, and Jacques Cognard, the company’s product area manager for oil and marine products.

Plea agreements have been worked out for both men, subject to court approval, and under the terms of these each will serve 14 months in prison – and will provide their full cooperation in the US Department of Justice’s ongoing investigation. Additionally, Caleca has agreed to pay a US$75,000 fine and Cognard a $100,000 fine.

“Prosecuting international cartels that harm US businesses and consumers continues to be our top law enforcement priority,” said Thomas O. Barnett from the Department’s Antitrust Division. “The outstanding efforts of the Division staff and other federal investigators, as well as the cooperation with competition agencies from other countries, enabled us to catch and promptly bring to justice these individuals for rigging bids and fixing prices.”

The conspiracy, which came to light in May, saw price fixing of marine hose and related products over an eight-year period. Executives from several high profile companies are said to have participated in the cartel, discussing the setting of prices and allocation of market share at meetings and by telephone, fax and e-mail. Participants agreed not to compete for each other’s customers either by not submitting bids or by tendering unrealistic bids with inflated prices.

Caleca and Cognard were amongst eight international executives, were arrested in the US on May 2, 2007 and charged with bid rigging and price fixing in the marine hose market following their participation in a cartel meeting in Houston.
Caleca and Cognard have been charged with a violation of the Sherman Antitrust Act, which carries a maximum sentence of 10 years imprisonment and a fine of $1 million for individuals. The maximum financial penalty may be increased to double the gain derived from the crime or twice the loss suffered by the victims of the crime if either of those amounts is greater than the statutory maximum fine.