According to a Reuters article on Tuesday, an electrical contractor has filed an antitrust lawsuit in the U.S. District Court for Northern Illinois, accusing several major PVC pipe manufacturers of conspiring to overcharge municipal and commercial buyers.
The lawsuit, filed by George Bavolak, owner of Metropolitan Energy Service in Minnesota, alleges that companies like Westlake, Atkore, Otter Tail (NASDAQ:OTTR) and others began a price-fixing scheme in 2021.
It is alleged that the companies started to fix prices by sharing competitively sensitive data with industry publication OPIS to unlawfully coordinate pricing.
The pipes in question are used for drinking water and protecting bundled wires.
Reuters said that the lawsuit, which is seeking class action status, accuses the defendants of violating U.S. antitrust laws.
The publication said OPIS is also named as a defendant in the case.
In response to the lawsuit, Otter Tail, one of the companies accused, stated that it will "vigorously" fight the claims. However, Reuters noted that Westlake, Atkore, JM Eagle, and OPIS have not yet responded to requests for comment.
The lawsuit claims that the defendants' recent "historic" profit margins were partly driven by higher prices arising from COVID-related disruptions to the supply chain.
Bavolak's lawyers at Lockridge Grindal Nauen emphasized the need to hold companies accountable for using the pandemic as cover for illegal price-fixing.
According to Reuters, Bavolak is seeking class action status for contractors, cities, and others who allegedly overpaid for PVC pipes. The lawsuit suggests that there could be hundreds of thousands of members in the proposed class. Bavolak is pursuing unspecified monetary damages and a court order to stop the alleged price coordination.