Posted on 10/09/2002 6:10:45 PM PDT by southcarolina
COLUMBIA, S.C. -- Three South Carolina landowners filed suit Tuesday against International Paper, alleging the forest products giant violated antitrust laws by conspiring to keep Southeastern timber prices artificially low.
The suit, filed in U.S. District Court in Columbia, seeks three times the amount lost because of the alleged price fixing. The losses were not specified in the complaint.
The suit also seeks class-action status against International Paper, among the largest purchasers of harvested pulpwood timber in South Carolina. The action could potentially involve thousands of landowners.
"International Paper's illegal conduct has caused landowners in South Carolina and adjacent states to lose many millions of dollars on the sale of their pulpwood timber,'' the suit alleges.
International Paper officials said they were unaware of the complaint. As a matter of policy, the company could not comment further on the matter, spokesman Rick Ouellette said.
Connecticut-based International Paper operates S.C. mills in Eastover and Georgetown. It achieved significant buying power within state pulpwood circles in recent years by acquiring competitors Champion International, Union Camp and Federal Paper Board.
At the center of the dispute is International Paper's "quality supplier program,'' under which a small number of firms enter into contracts with International Paper to supply it with timber. Prices are then fixed by International Paper, the suit alleges.
The result of the program, introduced in 2000, is that International Paper no longer competes to buy timber tracts. Instead, it leaves purchasing to the selected companies, which then sell the timber to International Paper, the suit alleges.
Also, participating companies agreed not to compete with each other, further hurting timber values, the suit alleges.
In the first instance cited, plaintiffs Marion Crane of Columbia and Benjamin Porter of Asheville, N.C., sought to thin 37 acres of pine pulpwood in Richland County last May.
They received identical bids of $5.50 a ton from two International Paper quality suppliers, Canal Wood and Johnson Co. When questioned, both companies said International Paper set the price, which could not be changed, the suit alleges.
The suit also cites a second example, last October, when Robert Taylor of Georgetown sought bids to thin pulpwood on 55 acres in Georgetown County from several companies, including four International Paper quality suppliers. All four offered the same price of $8.50 a ton, the suit alleges.
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