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Japanese Chemical Execs Indicted

July 26, 2000

SAN FRANCISCO (AP) _ A federal grand jury indicted three executives of a Japanese chemical maker in San Francisco on Tuesday in an ongoing legal battle to unravel what the U.S. government says is a worldwide price-fixing conspiracy among makers of food preservatives.

The company the executives control, Daicel Chemical Industries Ltd., also was charged and agreed Tuesday to plead guilty to U.S. price-fixing allegations and pay a $53 million fine for allegedly conspiring to set prices of sorbates between 1979 to 1996.

Indicted were Kunio Kanai, Hirohisa Ikeda and Takayasu Miyasaka, all of Japan. They have not entered a plea.

``The charges filed today against these high level Japanese executives makes it clear that no individual who participates in international cartels that defraud American businesses and consumers is beyond the reach of the law,″ said Joel I. Klein, assistant attorney general in charge of antitrust affairs.

The federal government is probing other companies that may have been involved, and more criminal indictments and fines are possible, government sources said.

Tuesday’s indictments came 11 days after Japanese chemical company Nippon Goshei agreed to plead guilty and pay a $21 million criminal fine for participating in the alleged international conspiracy to fix the price of sorbates, chemical preservatives used primarily in high-moisture and high-sugar foods, including dairy products and baked goods.

In addition, a former Nippon Goshei executive agreed to plead guilty and pay a $350,000 fine, the department said.

Daicel is the fourth company to plead guilty and cooperate with the ongoing investigation by the Justice Department’s antitrust division in a plot it says affected nearly $1 billion of sales in the United States alone.

Last October, Eastman Chemical Co., a U.S. sorbate producer, pleaded guilty and was fined $11 million. Last month, the German pharmaceutical giant Hoechst AG also pleaded guilty and was fined $36 million.

The companies were charged with violating the Sherman Antitrust Act by meeting with competitors to raise and set prices for sorbates sold in this country and abroad, and with exchanging pricing data to police the agreements.

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