Cartel Digest

Electrical Carbon Products

Electrical Carbon Products
  Overall Cartel Period 1988-2002
  Participants Le Carbone Lorraine SA; Schunk GmbH and Schunk Kohlenstofftechnik GmbH; SGL Carbon AG; Hoffman & Co. Elektrokohle AF; C. Conradty Nürnberg GmbH; Morgan Crucible Co. plc; Morganite Inc.; The Morgan Crucible Company; Morganite Canada Corp.
  Total Fines (DOJ) $11 million
  Total Fines (EC) €101.5 million

In September 2001, the European Commission (“EC”) and U.S. Department of Justice (“DOJ”) investigated possible cartel activity in the electrical carbon and graphite industry, or electrical carbon products.  These products are used to transfer electricity in and to electrical motors for a wide range of applications, including automobiles, public transport and virtually all consumer goods equipped with a motor (e.g., vacuum cleaners, shavers, etc.).  In 2003, the European market for electrical carbon products was valued at approximately €290 million annually.  The regulators found that, from 1988 to 2000, the cartel members, who controlled 93% of the European market, held more than 140 meetings to agree on price increases for a broad range of products.

 

Enforcement Highlights:

  • Morgan Crucible and several of its executives entered plea agreements with the DOJ or were convicted at trial, resulting in an $11 million fine on the company and $85,000 in fines and a combined 33-months in prison for the executives for obstructing the DOJ’s investigation.
  • Morgan Crucible also pled guilty to obstructing the Canadian Competition Bureau’s investigation and was fined $555,000 CAD.  Morgan Canada Corp. pled guilty to implementing the price-fixing scheme and was fined $450,000 CAD.
  • The EC imposed fines totaling over €101 million on five companies, but Morgan Crucible was given 100% immunity for alerting the Commission as to the existence of the cartel. 
Company Conspiracy Period Fine (USD) Plea Date No. of Excluded Individuals Plea Agreement
Morganite Inc.; and the Morgan Crucible Company 1/90-5/00 $11 million 11/04/2002 4 Plea Agreement
Individual Company Prison Sentence Fine (USD) Plea Date Plea Agreement
F. Scott Brown, Global President, Morgan Advanced Materials & Technology Inc. Morganite Inc.; and The Morgan Crucible Company 6 months $20,000 09/24/2003  
Ian P. Norris, CEO Morganite Inc.; and The Morgan Crucible Company 18 months $25,000 12/13/2010  
Robin Emerson, Marketing Employee Morganite Inc.; and The Morgan Crucible Company 5 months $20,000 12/05/2003 Plea Agreement
Jacobus Johan Anton Kroef, Chairman, Industrial & Traction Division Morganite Inc.; and The Morgan Crucible Company 4 months $20,000 09/24/2003  
Canada
Company Fine Date
Morgan Crucible Co. Plc $ 550,000 07/16/2004
Morganite Canada Corp. $ 450,000 07/16/2004
Europe
Company Fine Date
Le Carbone Lorraine SA € 43.1 million 12/03/2003
Schunk GmbH and Schunk Kohlenstofftechnik GmbH € 30.9 million 12/03/2003
SGL Carbon AG € 23.6 million 12/03/2003
Hoffman & Co. Elektrokohle AF € 2.8 million 12/03/2003
C. Conradty Nürnberg GmbH € 1.1 million 12/03/2003
Morgan Crucible Co. Plc Immunity 12/03/2003