CHICAGO (Legal Newsline) - Illinois Attorney General Lisa Madigan announced three settlement agreements on Friday with packaged ice manufacturers over allegedly conspiring not to compete in the packaged ice business.

The agreements will require the companies to pay $597,000 in civil penalties for alleged violations of the Illinois Antitrust Act. Home City Ice, based in Cincinnati will pay $512,500; Sisler's Dairy and Products, Inc., of Ohio, Ill., will pay $44,500; and Stoutin Premium Ice, based in Casey, Ill., will pay $40,000 to the state. In addition, the company agreed to a 10 year injunction that prohibits future anti-competitive activity.

"These companies illegally conspired to manipulate the marketplace," Madigan said. "Today's agreement holds them accountable for skirting the law and depriving businesses and consumers from competitive pricing."

Home City Ice and Sisler's Dairy and Products were among the defendants in a complaint filed by Madigan's office in March. Stoutin Premium Ice settled with Madigan's office prior to the complaint filing. There is still an ongoing case against two remaining defendants - Lang Ice Co. of Chicago and Tinley Ice Company of University Park, Ill. - in addition to two individual defendants, former Tinley Ice Company president Harold M. Teehan III and current president Timothy Teehan, both of Tinley Park, Ill.

Madigan alleged that the companies engaged in unlawful cooperative arrangements with their co-conspirators to divvy up markets, share pricing information, trade customers, discourage customers from switching suppliers by either quoting non-competitive prices to each other's customers or refusing to accept new business, and discussing price increases. The cooperative agreements were allegedly "market allocation conspiracies" and price-fixing agreements that deprive businesses and consumers of competition in violation of the Illinois Antitrust Act.

The conspiracy allegedly began in January 2003 when Crystal Clear Ice, an ice manufacturer in the Chicago area, sold its business to Home City Ice. Home City allegedly split those customers with its remaining competitors in the Chicago area and met with its competitors to discuss how they were going to divide the Crystal Clear Ice customers among themselves. From there, an alleged conspiracy ensued, allocating customers based on geographic location and yearly sales revenue.

The conspirators allegedly agreed that they would not solicit or take each other's customers and that violations of the agreement would require a compensation or trade from the other party. Competitors allegedly tried to discourage customers from switching suppliers by notifying competitors of customer inquiries, by telling the customer they were not accepting any new business at all or by quoting those customers non-competitive prices to discourage them from switching. The defendants allegedly communicated by email, phone, letter, fax and in person to monitor and continue the illegal non-competitive agreement.

More News