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Rubber Maker Settles Antitrust Claim

(CN) - Swedish rubber producer Trelleborg AB and four subsidiaries agreed to pay more than $15 million to end a whistleblower suit accusing them of rigging bids and fixing prices in the marine products industry, the U.S. Attorney's Office in Los Angeles announced.

Trelleborg AB and four subsidiaries conspired to submit rigged bids, fix prices and allocate market shares for marine fenders and plastic pilings purchased by the U.S. Navy and other federal departments, federal prosecutors say.

The investigation began in 2005 after a whistleblower filed a False Claims Act lawsuit naming Bridgestone, March, Yokohama and Dunlop as conspirators.

Those companies paid nearly $500,000 in fines to resolve the allegations without admitting wrongdoing, according to the U.S. Attorney's Office in Los Angeles. Trelleborg paid $14 million to settle the lawsuit, also denying any wrongdoing.

A criminal investigation into the same charges resulted in some two dozen convictions last year. Trelleborg AB subsidiaries Virginia Harbor Services and Trelleborg Industrie S.A.S., of France, each pleaded guilty to felony antitrust charges and were sentenced to pay more than $10 million in fines.

The settlement ends a four-year civil investigation into Trelleborg's fraud and price-fixing activities, said Abraham Meltzer, assistant U.S. attorney in the civil fraud division in Los Angeles.

"At least from my perspective of the civil false claims investigation, this is the end of the investigation into Trelleborg," Meltzer said.

The whistleblower suit also implicated Frank March, of Sevierville, Tenn., and two Virginia corporations, SHI Inc. and SII Inc. March paid $1 million to resolve the allegations, prosecutors say.

Marine fenders are used as a cushion between ships and docks, piers and other ships. Plastic marine pilings are used as substitutes for traditional wood timbers in piers and other marine construction projects.

The whistleblower, Douglas Farrow, will receive approximately 15 percent to 25 percent of the civil recovery, prosecutors say.

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