Cleveland Scrap Dealer Fined for Price Fixing

Columbia Iron & Metal Co. was found to be part of a wide-ranging scheme where companies that bought scrap metal divided suppliers and rigged bids.

The case resulted from a lawsuit filed in 2002 on behalf of two local companies, Lincoln Electric and Profile Grinding, which sell scrap metal to local buyers.

The jury verdict represents how much Lincoln and Profile Grinding were underpaid because of the rigged bids, attorneys said.

The jury cleared Willoughby-based DeMilta Iron & Metal of any wrongdoing.

The Justice Department began an investigation of the local scrap metal market in the early 1990s.

Since then, several people have pleaded guilty and been sent to prison for their roles in the price-fixing conspiracy.

Four companies, including M. Weingold & Co. and Harry Rock & Associates Inc., already settled out of court and agreed to pay more than $15 million in fines.

In the midst of the investigation, Lincoln Electric and Profile Grinding filed a civil lawsuit against many of the companies involved in the probe.

The verdict against Columbia Metal, also known as Columbia Trading, was the first time any company went to trial as part of litigation involving the local scrap-metal industry, said plaintiffs' lead attorney Edmund Searby.

"By the jury's verdict, we were able to prove the involvement of [Columbia], even though they've never been charged" criminally, Searby said.

Lawyers and company officials for Columbia Trading could not be reached.

Because Columbia violated antitrust laws, Judge Kathleen O'Malley could triple the award to more than $34 million, Searby said. Cleveland Plain Dealer