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Sea Star and Horizon face the music

March 11 - Sea Star Line LLC and Horizon Lines LLC will pay a USD3.4 million settlement to resolve allegations that they violated the False Claims Act when they knowingly fixed the price of government cargo transportation contracts between the USA and Pue

Florida headquartered Sea Star Line has agreed to pay USD1.9 million while North Carolina based Horizon Lines will pay USD1.5 million, says the US Department of Justice.

"Today's civil settlements demonstrate our continuing vigilance to ensure that those doing business with the government do not engage in anticompetitive conduct," said assistant attorney general for the Justice Department's Civil Division, Stuart F. Delery.  "Government contractors who seek to profit at the expense of taxpayers will face serious consequences."

A statement on the US Justice Department website read: "The government alleged that former executives of the defendant ocean shippers used personal email accounts to communicate confidential bidding information, thereby enabling each of the shippers to know the transportation rates that its competitor intended to submit to federal agencies for specific routes. This information allowed the shippers to allocate specific routes between themselves at predetermined rates."

Companies affected by the illegal activities include the U.S. Postal Service and Department of Agriculture. Both Sea Star Line and Horizon Lines previously pleaded guilty, in related criminal proceedings, to anti-competitive conduct in violation of the Sherman Act.

In December 2013 former president of Sea Star Line, Frank Peake, was sentenced to serve five years in prison and to pay a USD25,000 criminal fine for his participation in a conspiracy to fix rates and surcharges for freight transported by water between the continental United States and Puerto Rico.

Peake and his co-conspirators, through meetings and other communications in the continental United States and Puerto Rico, managed to fix, stabilise and maintain rates and surcharges for Puerto Rico freight services. He was involved in the conspiracy from at least late 2005 until at least April 2008, says the US Department of Justice.

Neither Sea Star Line LLC or Horizon Lines LLC were prepared to comment on the ruling.

www.horizonlines.com

www.seastarline.com

Heavy Lift | News

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