Indictments: A Bathroom Conspiracy?

U.S. Justice Department lawyers last week brought charges of a major price-fixing conspiracy in the nation’s plumbing-fixture industry. Fifteen manufacturers, including the American Radiator & Standard Sanitary Corp., the Crane Co. of Manhattan, and the Kohler Co. of Kohler, Wis., plus the industry’s Washington-based trade association and eight high-ranking company officers, were accused of collusion in criminal violation of the Sherman Antitrust Act. The charges involved sales and prices of most sinks, toilets, tubs and other bathroom equipment sold, primarily for home use, from the fall of 1960 through early this year.

Filed in Pittsburgh’s federal district court, the Justice Department’s complaint charged that some of the companies .had huddled between November 1960 and mid-1962 to “fix, stabilize and maintain” artificially high prices for inexpensive vitreous-china fixtures, involving some $30 million in sales a year; another group had agreed, beginning in 1962, to drop low-priced (and low-profit) lines of equipment while hiking the tag on the more expensive models, involving about $1 billion in sales all told; company executives had reached their agreements and planned staggered publication of new price lists “in order to avoid suspicion” during conventions and “under the guise of so-called ‘official’ Plumbing Fixtures Manufacturing Association meetings” in New York, Chicago, Palm Beach and other cities.

First reaction from the companies was understandably wary. Because “no Kohler witnesses were called to testify or were interviewed by Government attorneys,” Kohler Vice President and General Counsel Lucius P. Chase said he was not even sure of “what our company is alleged to have done.” Chicago’s Borg-Warner Corp., one of the 15, knew of no “basis for the charges.” American-Standard Chairman Joseph A. Grazier was certain that “the charges against us will prove to be unfounded.”

No one could say just when the case —which could bring a $50,000 fine for each of the manufacturing companies and a similar fine plus a year in prison for the indicted executives—would come to a legal verdict.