What is the stated cause of action in the 2005 complaint filed by the U. S. Justice Department against the Zeon Chemical company for antitrust violations

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Business

Quinn Glenn

17 December, 11:19

What is the stated cause of action in the 2005 complaint filed by the U. S. Justice Department against the Zeon Chemical company for antitrust violations

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Sage Booth · Answer 1

Zeon was charged with violating Section 1 of the Sherman Act, which states that, "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal".

The Department charged that Zeon and unnamed co-conspirators carried out the conspiracy by:

Participating in conversations and meetings to discuss prices of NBR to be sold in the United States and elsewhere; Agreeing, during those conversations and meetings, to raise and maintain prices of NBR to be sold in the United States and elsewhere; and Issuing price announcements and price quotations in accordance with the agreements reached.

The offence carries a maximum fine of $10 million for corporations and a maximum penalty of three years imprisonment and a fine of $350,000 for individuals for violations occurring before June 22, 2004. The maximum statutory fine may be increased to twice the gain the conspirators derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Explanation:

A cause of action is a legal term which connotes a series of facts that are enough to warrant a legal action against a defendant. It begins with the major premise which is a statement of the law violated, followed by supporting facts to justify the claim and then the consequences of such an action. In the 2005 complaint filed against Zeon Chemical company by the United States Justice Department, the said company was believed to be perpetrating price-fixing which is a violation of the antitrust laws, in this case, the Sherman antitrust laws.

The company was found to be fixing prices of synthetic rubber with some accomplices. They agreed to increase the price of this commodity and leave it at that level. This is an attempt to monopolize the market and limit competitors. This act is illegal. They pleaded guilty to the act and paid a fine of $10.5 million dollars.