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From Antitrust Law Daily, January 3, 2018

Former liquid aluminum sulfate industry executive pleads guilty to bid rigging

By Jeffrey May, J.D.

The Department of Justice has secured another guilty plea in its long-running investigation into collusion in the liquid aluminum sulfate industry. On January 3, Brian C. Steppig, a former industry executive, pleaded guilty to agreeing with competitors, from approximately 2005 until February 2011, not to compete for contracts for liquid aluminum sulfate, a coagulant used by municipalities to treat drinking and waste water, and by pulp and paper companies in their manufacturing processes. Steppig was indicted along with another industry executive, Vincent J. Opalewski, in 2016 (U.S. v. Opalewski, Case No. 2:16-cr-00065).

While not disclosed in the government’s indictment, Steppig has been identified elsewhere as a former high-level executive at GEO Specialty Chemicals, Inc. GEO Specialty agreed to plead guilty for its role in the conspiracy and to pay a fine of $5 million in 2016. Sentencing for Steppig will be left to the court, but the government has agreed under the terms of his plea agreement not to oppose a sentence of probation.

Opalewski, the other defendant named in the indictment, reportedly held executive positions at General Chemical Corp. In November 2017, the federal district court in Newark, New Jersey, dismissed Opalewski. The government moved for dismissal on the ground that further prosecution of that defendant was not in the interests of justice. Frank A. Reichl, another former GenChem executive, was the first individual to plead guilty in the probe.

"Today’s result reflects the Antitrust Division’s ongoing efforts to hold accountable those who seek to corrupt the competitive process and cheat customers," said Makan Delrahim, Assistant Attorney General in charge of the Department of Justice Antitrust Division, in announcing the guilty plea. "This offense was particularly egregious, counting among its victims cities and towns throughout the Southeastern United States that relied on the conspirators’ products to provide clean water to their residents."

The Justice Department did not seek restitution from Steppig. However, he and other industry executives and manufacturers have been named in civil antitrust actions brought by municipalities and others, seeking treble damages.

Attorneys: Patricia Lynn Jannaco for U.S. Department of Justice. J. Bruce Maffeo (Cozen O'Connor) for Brian C. Steppig. James Ross Smart (McElroy, Deutsch, Mulvaney & Carpenter, LLP) for Vincent J. Opalewski.

Companies: GEO Specialty Chemicals, Inc.; General Chemical Corp.

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