Settlement reached in lawsuit against paving companies
West Virginia settles with road paving companies for $101.3M
CHARLESTON, W.Va. (AP) - West Virginia officials announced a $101.3 million settlement in an antitrust suit against 11 asphalt and paving companies.
The state had accused them of cornering the market and driving up project costs. Attorney General Patrick Morrisey said Friday it was an end to ``sweetheart deals`` in the state.
He called it the state’s largest antitrust settlement and said the savings can be directed to road rebuilding.
The state has no shortage of roads in need of repair and unfinished projects. The state and six local governments will get the settlement money.
Updated: 12/09/2016 1:15 P.M.
CHARLESTON, W.Va. (AP) - More than half a dozen paving companies accused of developing a statewide monopoly to inflate the cost of asphalt have called for the case to be thrown out.
The Charleston Gazette-Mail reports defendants' attorney Booth Goodwin said in a court filing Monday that the case should be dismissed because the West Virginia Attorney General is not involved.
The lawsuit was filed on behalf of the West Virginia Department of Transportation Division of Highways and mirrors other complaints filed by five cities, as well as the Kanawha County Commission.
Goodwin says the DOH cannot pursue the lawsuit without “using the State’s lawyer.”
Bailey & Glasser, an outside firm, filed lawsuits in October accusing the companies of creating a scheme to inflate the price of asphalt by up to 40 percent.
Information from: The Charleston Gazette-Mail, http://wvgazettemail.com.
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Updated: 10/14/2016 11:00 A.M.
The State of West Virginia is now joining a lawsuit against West Virginia Paving and three other companies, charging they have joined together to drive up the price of roadwork in the past ten years.
West Virginia Paving issued a statement saying denying the allegations and vowing to fight them in court.
The statement, in part, says:
“As the cities are aware, the bulk of all price changes were directly related to the cost of transportation and raw materials. Since WVP and the other defendants purchase the majority of their hauling services, aggregates, and liquid asphalt from third parties, the price of asphalt is primarily based on the prices charged by third parties for these materials and services and WVP and the other defendants could not artificially inflate prices by 40%.”
Four West Virginia cities claim a number of paving companies have effectively formed a monopoly that’s driven up prices of paving projects in the past ten years.
The four cities: Parkersburg, Charleston, Beckley and Bluefield, say the companies cooperated to eliminate competition among themselves.
The result, they say: a major increase in paving costs, and less road construction and repair.
The companies include Kelly Paving, who, coincidentally, is one of the companies involved in paving work on Seventh Street in Parkersburg that began Thursday.
The suit charges Kelly, and three former competitors, have merged to become, in effect, one paving firm.
As a result, the suit says, competition in West Virginia’s asphault industry is almost non-existent.
“There are allegations in the complaint that, based on competitive markets in other states, like Kentucky for example, we know West Virginia municipalities are overpaying by 40%,” says Michael Hissam, an attorney for the law firm Bailey Glasser of Charleston, which filed the suit on behalf of the cities. “Municipalities vary as to what they spend on paving, but you can take as an allegation in our complaint the overcharges represent 40%.”
Hissam says while the four cities are specifically making the allegations, any municipality or local government could benefit from the outcome of the suit.
It covers the sale of paving materials since the beginning of 2006.
We reached out to one of the defendants, Kelly Paving, who has an office in Parkersburg, for comment on the legal action.
We have not heard back from them.
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