(Photo by Tomohiro Ohsumi/Getty)
The Justice Department has a message for companies in trouble for fixing prices: If you’re going to come clean, you better not hold back.
On Thursday prosecutors secured a guilty plea from Japan’s Bridgestone Corp. and walloped the company with a $425 million criminal fine for price-fixing and bid rigging in the market for rubber auto parts. The DOJ’s press release made it clear that the hefty penalty was based partly on Bridgestone’s silence about the price-fixing conspiracy three years ago, when it paid a $28 million fine and admitted to antitrust and bribery violations concerning sales of rubber hose used by the marine oil industry.
“The Antitrust Division will take a hard line when repeat offenders fail to disclose additional anticompetitive behavior,” said top DOJ antitrust lawyer Brent Snyder. “Bridgestone’s failure to disclose this conspiracy was a factor in determining the $425 million fine.”
In addition to submitting to the fine, Bridgestone copped to a one-count information filed Thursday in U.S. district court in Toledo, Ohio. Steven Reiss of Weil, Gotshal & Manges confirmed that he represented Bridgestone in the matter. Skadden, Arps, Slate, Meagher & Flom represented the company in its 2011 guilty plea in the marine hose case.
According to prosecutors, Bridgestone officials colluded with competitors to fix prices for rubber and metal parts installed in suspension systems, engine mounts, and elsewhere in automobiles to reduce engine and road vibration. Bridgestone and its coconspirators allegedly suppressed competition and rigged bids for the parts in violation of Section 1 of the Sherman Act from at least 2001 to 2008.
The Antitrust Division’s ongoing investigation into price fixing and bid rigging in the automotive parts industry has been its largest ever, netting $2 billion in criminal fines from 26 companies.
Bridgestone said in a statement that it is fully cooperating with the DOJ’s probe. The company also announced that certain members of its board of directors and corporate officers will forego bonuses scheduled to be paid next month. Some also will forfeit part of their regular pay “to underscore the company’s sincere regret for this incident.”