From: Nigel Allen <nigel.allen@canrem.com>
Subject: Dairy Executives Charged With Bid Rigging
Followup-To: alt.activism.d
Originator: rich@pencil.cs.missouri.edu
Organization: Echo Beach
Date: Tue, 28 Jul 1992 23:19:49 GMT

press release from U.S. Department of Justice
 Dairy Executives Charged With Bid Rigging on School Milk Contracts
 To: National Desk, North Carolina Correspondent
 Contact: U.S. Department of Justice, Public Affairs, 202-514-2007

   WASHINGTON, July 27 /U.S. Newswire/ -- The Department of Justice
said a federal grand jury indicted three dairy executives for
antitrust violations today, charging that they participated in a milk
and dairy products bid rigging conspiracy involving North Carolina
public schools.
   They also were charged with four counts of mail fraud.
   A grand jury in U.S. District Court in Greensboro, N.C., returned
a five-count indictment against Hugh P. Bowman and Joe C. McMillan
of Flav-O-Rich Inc. and Paul W. Tucker, formerly of Land-O-Sun
Dairies Inc.  The three were charged with conspiring to rig bids to
supply milk and dairy products to designated schools in North
Carolina and using the mail to further their scheme.
   In 1991, Flav-O-Rich, headquartered in Louisville, Ky., was
charged with rigging bids of milk contracts for public schools and
military installations and paid a total of $5 million to settle all
criminal and civil liabilities in Florida, Puerto Rico and Kings Bay
Naval Base in Georgia.  In 1989, Land-O-Sun, headquartered in Johnson
City, Tenn., pleaded guilty to charges of rigging bids on public
school milk contracts in Florida and was fined $325,000.
   Count one of today's indictment charged that from at least as
early as the spring of 1982 until the end of the 1987-88 school year
the three dairy executives and others conspired to submit collusive,
noncompetitive and rigged bids for certain school milk and dairy
products contracts in violation of Section 1 of the Sherman Act.
   According to the indictment, the affected school systems included
Alamance, Alexander, Buncombe, Gaston, Guilford, Iredell, Lincoln,
Randolph, Rowan, Stanly, Transylvania, Watauga and Yadkin counties;
the cities of Asheboro, Asheville, Burlington, Chapel Hill-Carrboro,
Greensboro, Mt. Airy, Reidsville and Thomasville; Charlotte
City/Mecklenburg County; and Western Carolina University.
   Counts two and three charged the defendants with mail fraud for
causing the Alamance County schools to mail checks to Land-O-Sun to
pay for contracts rigged as part of the conspiracy.
   Counts four and five charged the defendants with mail fraud for
causing the Rowan County schools to mail checks to Flav-O-Rich to pay
for contracts rigged as part of the conspiracy.  The indictment
charged that these mailings were in furtherance of the fraudulent bid
rigging scheme.
   Charles A. James, acting assistant attorney general in charge of
the Antitrust Division, said the charges resulted from a federal
grand jury investigation into collusion among suppliers of dairy
products to public schools in North Carolina.
   The investigation, conducted by the Antitrust Division's
Litigation I section, continues in North Carolina, James said.  James
also noted that, to the extent permitted under federal rules, the
federal investigators are coordinating their efforts with the North
Carolina Attorney General's office which is conducting a separate
investigation.
   The maximum penalty for an individual convicted under the Sherman
Act for a violation occurring prior to Nov. 16, 1990, is three years
imprisonment and a fine that is the greatest of $250,000, twice the
pecuniary gain derived from the crime or twice the pecuniary loss
caused to the victims of the crime.
   The maximum penalty for an individual convicted under the mail
fraud statute is five years imprisonment and a fine that is the
greatest of $250,000, twice the pecuniary gain derived from the crime
or twice the pecuniary loss caused to the victims of the crime.
   Including today's indictment, the Antitrust Division has filed
53 criminal cases against 26 corporations and 41 individuals
involving bid rigging on milk and other dairy products contracts.
Cases have been brought in Florida, Georgia, North Carolina, South
Carolina, Virginia, Kentucky, Illinois and Texas.
   Twenty-three corporations and 28 individuals have been convicted
and paid total fines of approximately $20.7 million.  Total civil
damages are more than $6.2 million.  Thirty-two grand juries in
21 states continue to investigate the milk industry.
 -0-
--
Canada Remote Systems  - Toronto, Ontario/Detroit, MI
World's Largest PCBOARD System - 416-629-7000/629-7044

Newsgroups: misc.activism.progressive