FLORIDA-BASED CROWLEY LINER SERVICES INC. PLEADS GUILTY
FIXING ON FREIGHT SERVICES BETWEEN U.S. AND PUERTO
Company Sentenced to Pay $17 Million Criminal Fine
WASHINGTON - Jacksonville, Fla.-based Crowley Liner Services
Inc. pleaded guilty and was sentenced to pay a $17 million
criminal fine for its role in a conspiracy to fix prices in
the coastal water freight transportation industry, the
Department of Justice announced today.
According to a one-count felony charge filed yesterday in the
U.S. District Court for the District of Puerto Rico, Crowley
Liner Services engaged in a conspiracy to fix base rates for
water transportation of certain freight between the
continental United States and Puerto Rico from as early as
January 2006 until at least April 2008.
Crowley Liner Services transports a variety of cargo
shipments, such as heavy equipment, cargo that would not fit
into containers, used cars and liquids capable of being
transported only in tanker containers, on scheduled ocean
voyages between the United States and Puerto Rico.
According to the charges, Crowley Liner Services and
co-conspirators carried out the conspiracy by agreeing during
meetings and discussions to fix the base rates to be charged
to non-government purchasers of water transportation of
certain freight between the continental United States and
Puerto Rico. The department said that Crowley Liner Services
and co-conspirators also engaged in meetings for the purpose
of monitoring and enforcing adherence to the agreed-upon
rates and sold Puerto Rico freight services at collusive and
"Including this sentencing, as a result of the Antitrust
Division's ongoing investigation, three freight companies
have been sentenced to pay criminal fines totaling more than
$45 million and five executives have been sentenced to serve
prison time totaling more than 11 years," said Scott D.
Hammond, Deputy Assistant Attorney General of the Antitrust
Division's Criminal Enforcement Program. "By agreeing
to fix prices for coastal shipping services to and from
Puerto Rico, Crowley Liner Services and its co-conspirators
thwarted the competitive process by forcing consumers to pay
inflated rates for these services."
On Dec. 20, 2011, Sea Star Line LLC was sentenced to pay a
$14.2 million criminal fine. On March 22, 2011, Horizon Lines
LLC was sentenced to pay a $15 million criminal fine.
Additionally, five shipping company executives-Gabriel Serra,
Peter Baci, R. Kevin Gill, Gregory Glova and Alex G.
Chisholm-have pleaded guilty. Frank Peake, the former
president of Sea Star Line, was charged on Nov. 17, 2011, and
is scheduled to stand trial on Jan. 14, 2013.
Crowley Liner Services pleaded guilty to price fixing in
violation of the Sherman Act, which carries a maximum fine of
$100 million for corporations. The maximum fine may be
increased to twice the gain derived from the crime or twice
the loss suffered by the victims of the crime, if either of
those amounts is greater than the statutory maximum fine.
This case arose from an ongoing federal antitrust
investigation into price fixing, bid rigging and other
anticompetitive conduct in the coastal water freight
transportation industry, which is being conducted by the
Antitrust Division's National Criminal Enforcement Section;
the Baltimore Resident Agency of the Department of Defense's
Office of the Inspector General, Defense Criminal
Investigative Service (DCIS); and the Miami Field Office of
the Department of Transportation's Office of Inspector
General (DOT-OIG). Anyone with information concerning
this investigation is urged to call the Antitrust Division's
National Criminal Enforcement Section at 202-307-6694, visit
www.justice.gov/atr/contact/newcase.htm or contact DCIS's
Baltimore Resident Agency at 410-347-1620.