Asphalt Specialists LLC and Al’s Asphalt Paving Company Inc., along with two executives from these companies, have admitted to conspiring to rig bids for paving service contracts in Michigan. The firms colluded to manipulate bids in each other's favor from 2013 through 2018.
According to a U.S. Justice Department press release, Bruce F. Israel, the former vice president of Asphalt Specialists, and Edward D. Swanson, the president of Al’s Asphalt, both pleaded guilty to two counts of violating Section One of the Sherman Act. These violations carry potential penalties of up to 10 years in prison and a $1 million criminal fine for individuals, while companies could face a maximum penalty of $100 million criminal fine.
Andrea M. Kropf, DOT OIG Midwestern Region Special Agent in Charge, said in the press release: "Through these guilty pleas, the U.S. Department of Transportation Office of Inspector General (DOT OIG) holds accountable two executives and two Michigan companies that engaged in this bid-rigging scheme." She added that they "will continue to partner with our law enforcement and prosecutorial colleagues to pursue and prosecute those who attempt to stifle competition by violating federal antitrust laws."
The Justice Department press release also revealed that Asphalt Specialists and Israel as well as Al’s Asphalt and Swanson conspired similarly with F. Allied Construction. The bid rigging involving Asphalt Specialists and F. Allied Construction occurred between July 2017 and May 2021 while that between Al’s Asphalt and F. Allied Construction took place from June 2013 through June 2019. In August 2023, F. Allied along with two of its executives pleaded guilty in these separate instances.
In each conspiracy case outlined by the Justice Department press release, the companies employed similar tactics. They coordinated their bid prices with a pre-agreed 'bid-losing' company which would intentionally submit non-competitive bids, creating an illusion of competition where there was none. The contract recipient was predetermined before the bidding process.
The investigation into these anticompetitive practices was a collaborative effort between three agencies—the Justice Department’s Antitrust Division’s Chicago Office, the DOT OIG and the U.S. Postal Service Office of Inspector General—as part of a broader antitrust probe into the asphalt paving services industry.
