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PVC Pipe Makers Accused of Price-Fixing in Federal Antitrust Lawsuit

By  |  August 27, 2024
Price-Fixing

An electrical contractor has launched a price-fixing antitrust lawsuit in the United States, accusing several major PVC pipe manufacturers, including Westlake and Atkore, of conspiring to overcharge municipal and commercial buyers. The lawsuit, filed as a proposed class action, was brought to federal court in Chicago on Friday. According to Reuters, the plaintiff, George Bavolak, who owns Metropolitan Energy Service in Minnesota, alleges that the companies began scheming in 2021 to fix prices for pipes used in drinking water systems and for protecting bundled wires.

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    The lawsuit accuses Westlake, Atkore, Otter Tail, JM Eagle, and six other manufacturers of violating U.S. antitrust laws by sharing competitively sensitive data through OPIS, an industry publication, to unlawfully coordinate on pricing. Per Reuters, OPIS, a Dow Jones company that provides pricing and market intelligence to subscribers, was also named as a defendant in the lawsuit.

    In response to the allegations, Otter Tail issued a statement on Monday denying the claims and vowing to “vigorously” contest them. The lawsuit notes that in 2022 alone, more than $3 billion worth of PVC municipal water pipes were sold in the United States, suggesting that the defendants’ substantial profit margins in recent years were partly driven by inflated prices resulting from COVID-related supply chain disruptions.

    Bavolak’s legal team, from the plaintiffs’ firm Lockridge Grindal Nauen, emphasized the need for accountability, stating that PVC “companies that used the COVID-19 pandemic as cover for illegal price-fixing need to be held accountable.” According to the lawsuit, Bavolak is seeking class action status on behalf of contractors, cities, and other entities that allegedly overpaid for municipal and electrical PVC pipes.

    The lawsuit estimates that the proposed class action could potentially include hundreds of thousands of members. Bavolak claims that OPIS played a key role in facilitating the exchange of “confidential, proprietary, and competitively sensitive data” among the defendants. The shared information reportedly included future pricing and sales data, which, according to the lawsuit, enabled the defendants to coordinate and signal their pricing activities.

    Bavolak is seeking unspecified monetary damages and a court order to prevent any further alleged price coordination among the manufacturers.

    The case is titled George Bavolak v. Atkore Inc et al, and it is being heard in the U.S. District Court for the Northern District of Illinois under case number 1:24-cv-07639.

    Source: Reuters