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DOJ Jury Convicts Two Executives in Concrete Price-Fixing Conspiracy

By  |  July 15, 2024

Gregory and David Melton were convicted Friday in the U.S. District Court in Savannah, Georgia, for their involvement in a price-fixing conspiracy to rig bids and allocate markets for the sale of ready-mix concrete in Georgia and South Carolina. This verdict marks the culmination of an extensive investigation into antitrust violations in the construction materials industry.

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    The price-fixing conspiracy, which operated from as early as 2010 until about July 2016, involved a coordinated effort to manipulate prices and bids for ready-mix concrete. The Meltons, along with others, orchestrated price-increase letters to customers, allocated specific jobs in the coastal Georgia area, and submitted collusive and noncompetitive bids, undermining the competitive market.

    Including the Meltons, this investigation has resulted in five criminal convictions and one deferred prosecution agreement. Previously, James Pedrick, Timothy Strickland and Strickland’s company, Evans LLC, pleaded guilty to participating in the same conspiracy. Pedrick’s former employer, Argos USA LLC, entered a deferred prosecution agreement with the Antitrust Division, admitted its role in the conspiracy, and agreed to pay a $20 million criminal penalty.

    “Concrete is essential to our nation’s infrastructure,” stated Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Today’s guilty verdicts reflect the Antitrust Division’s commitment to holding individuals accountable for cheating American consumers out of the opportunity to purchase necessary building materials free of corruption and collusion. The division and its law enforcement partners will continue to prioritize their work prosecuting individuals responsible for this illegal and unethical conduct.”

    U.S. Attorney Jill E. Steinberg for the Southern District of Georgia emphasized the importance of fairness in the marketplace. “Customers expect to receive fair value for construction materials – not to enrich unscrupulous vendors who collude to unfairly increase their profits,” Steinberg said. “This verdict makes it clear that our office and law enforcement partners will hold accountable those who violate the law to pad their bottom line.”

    Special Agent in Charge Joseph Harris of the Department of Transportation Office of Inspector General (DOT OIG), Southern Region, highlighted the broader implications of the case. “Bid rigging and fraud schemes are serious criminal actions that adversely impact the competitive contracting marketplace,” Harris noted. “Today’s conviction should serve to deter individuals and companies from engaging in deceptive practices that violate federal regulations and the public’s trust.”

    Violations of the Sherman Act, a federal criminal antitrust statute, are felonies. Individuals convicted of violating the Sherman Act can face up to 10 years in prison and a $1 million criminal fine.

    Source: Justice Gov