Madigan: Ice companies manipulated market

Keith Loria Mar. 10, 2011, 2:20am


CHICAGO (Legal Newsline) - Illinois Attorney General Lisa Madigan announced on Wednesday that she has filed a lawsuit against four packaged ice manufacturers that allegedly orchestrated a scheme that deprived consumers of fair prices and better quality service.

Lang Ice Co., Home City Ice, Sisler's Dairy and Products Inc., and Tinley Ice Company, along with Harold M. Teehan III, Tinley Ice Company's former president, and Timothy Teehan, its current president, allegedly violated the state's Antitrust Act through their actions.

The companies involved manufacture and deliver packaged ice for individual consumption and for use by retailers that sell packaged ice to consumers. Ice is also sold to government entities and groups that are hosting special events.

Madigan alleges that the companies conspired to not compete against one another to keep prices higher than they should have been and divided the Illinois market. It is also alleged that the companies traded customers, shared pricing information and discouraged customers from switching suppliers.

Madigan alleges that the cooperative agreements were "market allocation conspiracies," which deprived businesses and consumers of competition.

"My office will not allow for illegal conspiracies that effectively penalize consumers both on price and service," Madigan said. "These companies circumvented market forces to maximize profits at the cost and detriment of their customers. They will be held accountable for their actions."

The conspiracy allegedly has its roots in another ice manufacturer going out of business in January 2003. At the time, Crystal Clear Ice referred all its customers to Home City Ice. The latter then decided to split those customers with the other defendants with the plan in place for the conspiracy.

Madigan alleges that the conspirators agreed not to solicit or steal one another's customers. Any violations would result in a compensation or trade from the other party.

Furthermore, it is alleged that the defendants routinely provided potential customers with false information to hide the true reason they would not accept their business, blaming everything from fuel costs to the lack or freezers available.

Madigan seeks an injunction against each company to stop the illegal conduct. She also wants civil penalties to be assessed against each, damages for overcharges and all costs associated with the litigation.

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