MORGANTOWN — A 2107 state antitrust suit against asphalt companies has yielded a $101.35 million settlement, Gov. Jim Justice and Attorney General Patrick Morrisey announced Friday.
It’s the largest antitrust settlement in history, Justice said. “The magnitude of this is just off the chart. … It’s a heck of a day for West Virginia.”
The settlement will be used for road work and comes in two forms, Morrisey and Transportation Secretary Byrd White explained. Three of the defendants – West Virginia Paving, Kelly Paving and American Asphalt – will within 30 days make a combined, upfront payment of $30.35 million to the state and local plaintiffs. That includes a combined share of $4.4 million for Beckley, Bluefield, Charleston, Huntington, Parkersburg and Kanawha County.
The remainder, $71, will be in the form of credits. Part will be applied to jobs already completed that are awaiting payment. The rest, White said, will be used for state-funded purchase order paving jobs on the books and slated for spring and summer. None of the credits will be applied to federally funded projects.
Morrisey provided some case background in a press release. His office filed the suit in 2017 with the Department of Transportation. It alleged that West Virginia Paving Inc., Kelly Paving Inc., American Asphalt & Aggregate Inc. and eight related companies conspired to monopolize the state-approved asphalt and paving market, thus reducing competition and maximizing profits at the taxpayers’ expense.
The suit alleged that the defendants used acquisitions (buying up competitors) or non-compete agreements to unlawfully eliminate competitors and push asphalt prices higher in areas controlled by West Virginia Paving, its parent company CRH and other defendants as compared to parts of the state with robust competition.
During the announcement to the press, Morrisey said, “This case is precedent setting for our state and our country. … Of course it means more competition for our great state.” He hopes it will draw additonal vendors to offer bids in the state.
Morrisey said the suit led to a forced ownership change of a major joint venture that curbed competition. The press release explains that the settlement gives American Asphalt control of a joint venture with two CRH subsidiaries and ends a non-compete clause, allowing American’s owner to sell asphalt more broadly. In return, the CRH subsidiaries can move forward with eliminating a requirement to buy a minimum amount of asphalt from the joint venture.
The suit also requires the companies to give advance notice of future acquisitions.
Morrisey said that the defendants admitted no wrongdoing in agreeing to the settlement.
Justice said some people will point out this announcement came just a few days before Tuesday’s election and view it as a campaign ploy. “I would say, ‘bull you-know-what.”
He said they wanted it settled a long time ago. “We finally got it done. … it just kept dragging as all lawsuits do.”
West Virginia Paving issued a statement following the announcement: “WVP is of the firm view that it has always acted lawfully and has not been found to have been in breach of any West Virginia laws. All parties believe that a mediated settlement is the most pragmatic solution to their differences. WVP has a long and successful history of doing business with WVDOT and will continue to do so going forward. This agreed settlement allows both parties to move ahead, avoids the uncertainty of a protracted legal process and allows WVP to continue servicing its customers.”
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