Eastman, Hoechst Sued Over Sorbate Prices

Chem/Serv Inc. is suing Eastman Chemical Co. and Hoechst AG, alleging the companies violated antitrust laws by inflating the price of sorbates they sold. Both companies have previously pleaded guilty to similar allegations filed by the Antitrust Division of the US Dept. of Justice, according to the suit. Chem/Serv claims it purchased sorbates, the petroleum-based chemicals used to preserve food products, from the defendants at least once between January 1979 and June 1997 and suffered unspecified losses as a result of the higher prices. Tennessee's Eastman and Hoechst of Germany are the two main sorbate producers in the U.S. Eastman pleaded guilty to a criminal antitrust violation on Sept. 30, 1998, and agreed to pay an $11-million fine for participating in an international price-fixing scheme in the sorbates industry. As part of the plea, Eastman agreed to cooperate in a further Dept. Of Justice investigation. On May 5, Hoechst and one of its marketing managers were charged and later pleaded guilty to similar price-fixing allegations. Hoechst and its manager agreed to pay fines of $36 million and $250,000, respectively. Chem/Serv, which is based in Minnesota, filed the complaint May 14 in Manhattan federal court and is seeking class action certification.

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