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From Antitrust Law Daily, November 9, 2016

Japanese auto parts supplier agrees to plead guilty in steel tubes cartel probe

By Jeffrey May, J.D.

The Department of Justice Antitrust Division has netted its first plea agreement resulting from an investigation into a price fixing conspiracy among auto parts suppliers involving automotive steel tubes. The Antitrust Division has announced that Usui Kokusai Sangyo Kaisha Ltd. of Japan has agreed to plead guilty and to pay a $7.2 million criminal fine for its role in the conspiracy. A one-count felony charge was filed yesterday in the federal district court in Cincinnati (U.S. v. Usui Kokusai Sangyo Kaisha Ltd., Case No. 1:16-cr-00106-TSB).

Usui was charged with conspiring with competitors to allocate customers and to agree on bids, prices, and price adjustments to be submitted to customers of steel tubes. Usui’s role in the conspiracy lasted from approximately December 2003 through July 2011.

Automotive steel tubes are used in fuel distribution, braking, and other automotive systems and are sometimes divided into two categories –chassis tubes and engine parts, according to the Justice Department. Chassis tubes, such as brake and fuel tubes, tend to be located in the body of a vehicle while engine parts, such as fuel injection rails, oil level tubes, and oil strainer tubes, are associated with the function of a vehicle’s engine.

Earlier charges. The charge against Usui follows related indictments announced in June, naming two other Japanese auto parts manufacturers and their U.S. subsidiaries, as well as sales executives at the firms. Maruyasu Industries Co. Ltd., Maruyasu’s wholly-owned U.S. subsidiary, Curtis-Maruyasu America Inc., and sales executives, Tadao Hirade, Kazunori Kobayashi, Satoru Murai, and Yoshihiro Shigematsu were charged. The indictments in U.S. v. Maruyasu Industries Co., Ltd. and U.S. v. Tokai Kogyo Co., Ltd. were filed on June 15. Those cases are ongoing.

Warning from DAAG for criminal enforcement. This latest charge is a result of the Antitrust Division’s long-running investigation into the auto parts industry. Brent Snyder, Deputy Assistant Attorney General for criminal enforcement at the Antitrust Division said that "[t]his investigation is not completed, and the division will continue to prosecute automotive parts manufacturers and executives that sought to maximize their profits through anticompetitive means."

Including Usui, 47 companies and 65 executives have been charged in the auto parts investigation and have agreed to pay a total of more than $2.9 billion in criminal fines, according to the Justice Department.

Companies: Usui Kokusai Sangyo Kaisha Ltd.; Maruyasu Industries Co., Ltd.; Curtis-Maruyasu America, Inc.; Tokai Kogyo Co., Ltd.; Green Tokai Co., Ltd.

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