Antitrust—Concrete Industry

A Noblesville, Indiana company, along with three individuals, are the latest company to be indicted in a wide-ranging antitrust investigation of the concrete industry.^[1] Beaver Materials Corp. was named in the indictment, along with Chris and Rick Beaver—Beaver Materials’ operations manager and commercial sales manager, respectively—and John J. Blatzheim—the executive vice president of Builders Concrete and Supply Co.^[2] Builders Concrete and Supply pleaded guilty to price-fixing last month.^[3] To date, three companies and eight individuals have pleaded guilty in the investigation, which has resulted in $30 million in fines and has sent several executives to prison.^[4]

According to federal antitrust investigators, “several Indianapolis-area firms fixed the price of nearly all concrete sold [there] between July 2000 and May 25, 2004.”^[5] Beaver Materials, however, denies the allegations and says that “in the final analysis, it will turn out that we didn’t participate in any kind of conspiracy or agreement and we’re not guilty of anything.”

In addition to the antitrust allegations, the three men are accused of making false statements to investigators; all three were interviewed in May 2004, and all three denied knowledge of a local concrete cartel.^[6] Federal prosecutors allege that was a lie.

To successfully prosecute an individual for making false statements, the government needs to prove that a statement was made, that it was false, that there is materiality, that there was specific intent (as opposed to general intent), and that there is agency jurisdiction.^[7] It is tempting to ask whether such a law is constitutional when applied to individuals who are being investigated. In other words, does a denial of wrongdoing, the “exculpatory no,” count as a false statement? The answer is “yes.”^[8] The Fifth Amendment’s privilege against self-incrimination only allows an individual to remain silent, not to “swear falsely.”^[9] This is because lying to investigators perverts the administration of justice and the proper working of governmental functions.^[10]

We previously discussed domestic antitrust investigations in March, and January.

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[1] Three More Indicted in Concrete-Fixing Case, Associated Press (via theindychannel.com), Apr. 12, 2006.
[2] Id.
[3] J.K. Wall, 3 Indicted in Concrete Price Fixing, Indianapolis Star, Apr. 12, 2006.
[4] Id.
[5] Id.
[6] Id.
[7] See United States v. Gilbertson, 588 F.2d 584, 589 (8th Cir. 1978).
[8] See Brogan v. United States, 522 U.S. 398 (1997).
[9] Id. at 404-05.
[10] Id. at 402.