Source: http://www.justice.gov/atr/cases/f230200/230261.htm
Timestamp: 2015-05-24 17:51:21
Document Index: 104168191

Matched Legal Cases: ['§ 1', '§ 1623', '§ 1503', '§ 1', '§ 1', '§ 1623', '§ 1623', '§ 1', '§ 1', '§ 1']

Indictment : U.S. v. Alliance National Limited Partnership, et al.
EASTERN DIVISION UNITED STATES OF AMERICA, Plaintiff, v. ALLIANCE NATIONAL LIMITED PARTNERSHIP, d/b/a DEMILTA IRON & METAL, LTD; FRANCIS DEMILTA; and RONALD VAUGHN Defendants. |
| Filed: February 6, 2008 Criminal No.: 1:08CR0068 JUDGE GAUGHAN Violations: 15 U.S.C. § 1 18 U.S.C. § 1623; and 18 U.S.C. § 1503 INDICTMENT The Grand Jury charges: COUNT I CONSPIRACY TO RESTRAIN TRADE IN VIOLATION OF THE SHERMAN ANTITRUST ACT (15 U.S.C. § 1) THE DEFENDANTS 1. The following companies and individuals are hereby indicted and made Defendants in the charge stated below in Count One: ALLIANCE NATIONAL LIMITED PARTNERSHIP, d/b/a/ DEMILTA IRON & METAL, LTD. (hereinafter "DEMILTA IRON & METAL" unless otherwise noted); and
FRANCIS DEMILTA. DESCRIPTION OF THE OFFENSE 2. Beginning at least as early as August 1997 and continuing at least until March 2003, the exact dates being unknown to the Grand Jury, the Defendants DEMILTA IRON & METAL and FRANCIS DEMILTA and co-conspirators entered into and engaged in a combination and conspiracy to suppress and restrain competition by allocating scrap metal suppliers for the purchase of scrap metal in Northeast Ohio. The charged combination and conspiracy unreasonably restrained interstate trade and commerce in violation of Section 1 of the Sherman Act (15 U.S.C. § 1). 3. The charged combination and conspiracy consisted of a continuing agreement, understanding, and concert of action among the Defendants and co-conspirators, the substantial terms of which were to allocate scrap metal suppliers for the sale of scrap metal in Northeast Ohio, and, in return for not soliciting scrap suppliers of its co-conspirators, DEMILTA IRON and METAL was sold scrap metal by its co-conspirators at prices below market value. MEANS AND METHODS OF THE CONSPIRACY 4. For the purpose of forming and carrying out the charged combination and conspiracy, the Defendants and co-conspirators did the following things, among others: participated in meetings and conversations to discuss allocating suppliers of scrap metal (also referred to in the industry and by Defendants as accounts and customers); agreed, during such meetings and discussions, to allocate scrap metal suppliers and to not compete against each other for the purchase of scrap metal; allocated, pursuant to their agreement, scrap metal suppliers, denying such scrap metal suppliers a competitive price and thereby depressing or maintaining the price that DEMILTA IRON & METAL, FRANCIS DEMILTA, and their co-conspirators paid for scrap metal; agreed, during such meetings and conversations, which designated co-conspirator would purchase scrap metal from particular scrap metal suppliers; participated in meetings and conversations to discuss the submission of bids for the purchase of scrap metal; refrained from, pursuant to their agreement, competing against each other; agreed, pursuant to their meetings and discussions, that DEMILTA IRON & METAL would be sold scrap metal by its co-conspirators at a price below market value in return for DEMILTA IRON & METAL's agreement not to solicit scrap metal suppliers of its co-conspirators;
DEMILTA IRON & METAL's co-conspirators sold, pursuant to their agreement, scrap metal to DEMILTA IRON & METAL at a price below market value in return for DEMILTA IRON & METAL's not soliciting scrap metal suppliers of its co-conspirators; and DEMILTA IRON & METAL paid, pursuant to their agreement, prices below market value for scrap metal sold to it by its co-conspirators in return for DEMILTA IRON & METAL's not soliciting scrap metal suppliers of its co-conspirators. THE DEFENDANTS AND CO-CONSPIRATORS 5. Defendant ALLIANCE NATIONAL LIMITED PARTNERSHIP is an Ohio limited partnership that was formed in or about April 1993 and does business as DEMILTA IRON & METAL, LTD. DEMILTA IRON & METAL is headquartered in Willoughby, Ohio, and has its principal place of business in Northeast Ohio. At all times relevant to this Indictment, DEMILTA IRON & METAL was owned by FRANCIS DEMILTA. At all times relevant to this Indictment, DEMILTA IRON & METAL was engaged in the purchase and sale of ferrous and nonferrous scrap metal in Northeast Ohio and elsewhere. DEMILTA IRON & METAL purchased scrap metal for resale from suppliers of scrap metal, then sold the scrap metal it purchased to mills and foundries located inside and outside the State of Ohio. 6. At all times relevant to this Indictment, FRANCIS DEMILTA was the founder, owner, and president of ALLIANCE NATIONAL LIMITED PARTNERSHIP, d/b/a DEMILTA IRON & METAL, LTD. Prior to forming ALLIANCE NATIONAL LIMITED PARTNERSHIP and DEMILTA IRON & METAL, FRANCIS DEMILTA was the founder, owner, and president of DeMilta Scrap & Salvage, Inc., a business that FRANCIS DEMILTA started in the early 1980s and which also was engaged in the purchase and sale of scrap metal. At all times relevant to this Indictment, FRANCIS DEMILTA was directly engaged in the purchase and sale of scrap metal and supervised the business activities of DEMILTA IRON & METAL. 7. Various individuals, companies, and corporations not made Defendants in this Indictment, participated as co-conspirators in the offense charged and performed acts and made statements in furtherance of it. 8. Whenever this Count refers to any act, deed, or transaction of any company or corporation, it means that the company or corporation engaged in the act, deed, or transaction by or through its officers, directors, employees, agents, or other representatives while they were actively engaged in the management, direction, control, or transaction of its business or affairs. TRADE AND COMMERCE 9. Ferrous and nonferrous scrap metal is a residual product that has value. Typically, manufacturing plants, mills, and foundries generate ferrous and nonferrous scrap metal as a by-product. In the scrap metal industry, this type of scrap is generally referred to as industrial scrap. For example, tool and die makers or stamping plants end up with small or odd-shaped pieces of scrap that are a by-product of their manufacturing process. This scrap is valuable if picked up, sorted, and sold to mills or foundries that desire scrap metal as part of their manufacturing process. The business of scrap metal companies, such as the Defendants and co-conspirators, generally involves placing collection boxes (e.g., lugger and roll off containers) at manufacturers' sites to collect the scrap metal, then picking it up, processing it, and reselling it to customers. 10. At all times relevant to this Indictment, Defendants DEMILTA IRON & METAL, FRANCIS DEMILTA, and co-conspirators (1) purchased ferrous and nonferrous scrap metal from individuals and companies located inside and outside the State of Ohio; (2) sold or shipped ferrous and nonferrous scrap metal to individuals and companies located inside and outside the State of Ohio; and (3) caused ferrous and nonferrous scrap metal to be purchased from, sold to, or shipped from or to, individuals and companies located inside and outside the State of Ohio. 11. At all times relevant to this Count, substantial quantities of ferrous and nonferrous scrap metal bought and/or sold by the Defendants and co-conspirators were shipped across state lines in a continuous and uninterrupted flow of interstate trade and commerce. 12. The activities of the Defendants and co-conspirators that are the subject of this Count were within the flow of, and substantially affected, interstate trade and commerce. JURISDICTION AND VENUE 13. The combination and conspiracy charged in this Count was formed and carried out, in part, by the Defendants DEMILTA IRON & METAL, FRANCIS DEMILTA, and co-conspirators in the Northern District of Ohio within the five years preceding the return of this Indictment. ALL IN VIOLATION OF TITLE 15, UNITED STATES CODE, SECTION 1. COUNT II FALSE DECLARATIONS (18 U.S.C. § 1623) The Grand Jury further charges: THE DEFENDANT 14. RONALD VAUGHN is hereby indicted and made a Defendant in the charge stated below. 15. At all times relevant to this Indictment, Defendant RONALD VAUGHN was an employee of Alliance National Limited Partnership, d/b/a DeMilta Iron & Metal, Ltd. At all times relevant to this Indictment, RONALD VAUGHN was the vice president of DeMilta Iron & Metal, was directly engaged in the purchase and sale of scrap metal, and supervised the business activities of DeMilta Iron & Metal. RONALD VAUGHN and Francis DeMilta are brothers-in-law. DESCRIPTION OF THE OFFENSE (False material declarations about an agreement or understandin
between DeMilta Iron & Metal and co-conspirators
not to solicit each other's scrap metal suppliers) 16. On June 7, 2005, in the Northern District of Ohio, RONALD VAUGHN testified under oath as a witness before the Grand Jury, duly empaneled by the United States District Court for the Northern District of Ohio, sitting in Cleveland, Ohio, and knowingly made false material declarations concerning matters the Grand Jury was investigating, in violation of 18 U.S.C. § 1623. 17. At that time and place, the Grand Jury was conducting an investigation into possible violations of the Sherman Antitrust Act, 15 U.S.C. § 1, and other related federal offenses. The Grand Jury's investigation included the conduct of DeMilta Iron & Metal and its owners, officers, and employees, including RONALD VAUGHN and Francis DeMilta. 18. It was material to the Grand Jury's investigation to determine if any person or entity engaged in the purchase and sale of scrap metal had committed a violation of the Sherman Antitrust Act, 15 U.S.C. § 1, including any agreement to allocate scrap metal suppliers (also called accounts or customers). Thus, it was material to the Grand Jury to determine if RONALD VAUGHN had any awareness, knowledge, or information of, or participated in, any agreement or understanding with any competitor (i.e., another scrap metal dealer) to allocate scrap metal suppliers, in violation of 15 U.S.C. § 1, or other related federal criminal offenses. It was, therefore, material to the Grand Jury to determine: (a) if RONALD VAUGHN was aware of any agreement or understanding between DeMilta Iron & Metal and other scrap metal companies, including M. Weingold Company (hereinafter "M. Weingold" or "Weingold Company") or Harry Rock & Associates, Inc. (hereinafter "Rock" or "Rock Company"), to allocate or not to solicit each other's scrap metal suppliers; (b) if an agreement was struck at the Holiday Inn in 1997 ­ or ever ­ that DeMilta Iron & Metal would lay off of the accounts of its major competitor, M. Weingold, and its affiliated companies, including Rock, in return for M. Weingold and its affiliated companies laying off of DeMilta Iron & Metal's accounts; (c) whether there was ever at any time an agreement between DeMilta Iron & Metal not to compete with Weingold Company and its affiliated companies; (d) whether there was ever at any time an agreement between DeMilta Iron & Metal and Weingold Company and any of its affiliated companies to compete less vigorously than the companies would have competed but for an agreement; and (e) whether there was an agreement or understanding reached at a meeting at the Holiday Inn ­ or after ­ that DeMilta Iron & Metal would not solicit M. Weingold or its affiliated accounts in return for M. Weingold not soliciting DeMilta Iron & Metal's scrap metal accounts. 19. At the aforesaid time and place, RONALD VAUGHN, while under oath, knowingly declared falsely before the Grand Jury with respect to material matters as follows: (Page references are to the official Grand Jury transcript of RONALD VAUGHN, dated June 7, 2005. Declarations charged as false are underscored.) ************************* Q: And, of course, our understanding is that it was used in a way, that there was an agreement, there was an understanding between your company and the Weingold Company and the Rock Company[,] which included Best Atlas after Jack Weingold bought Best Atlas[,] and that agreement was this: That they would not solicit and take your scrap metal accounts or suppliers, and in return you would not solicit or take their scrap metal suppliers. A: That's not accurate. Q: That's not accurate? A: No, sir. Q: What's inaccurate about it? A: We don't have an agreement. Q: You say you don't have an agreement. A: No. Q: Did you have an agreement? A: Did not have an agreement. Q: Did you ever have an agreement? A: Never had an agreement. Q: Never had an understanding?