Remember The Iceman Price Fixeth? The post that reported a raid of Reddy Ice’s Dallas headquarters by federal antitrust enforcer types?
The raid now looks like the tip of a solid water object that floats and bobs in liquid water near the polar regions.
In March 2008, we and certain of our employees, including members of our management, received grand jury subpoenas issued from the U.S. District Court for the Eastern District of Michigan seeking information in connection with an investigation by the Antitrust Division of the United States Department of Justice ("DOJ") into possible antitrust violations in the packaged ice industry. In addition, on March 5, 2008, federal officials executed a search warrant at our corporate office in Dallas, Texas. We expect to make available documents and other requested information to the DOJ’s Antitrust Division in connection with the investigation. The subpoenas we and our employees received are part of a broader industry inquiry; at least one other packaged ice manufacturer has also received such a subpoena. Senior management is not award that the Company has engaged in anticompetitive behavior, or other activities, which would violate the antitrust laws. On March 6, 2008, our Board of Directors formed a special committee of independent directors to conduct an internal investigation of these matters. The special committee’s investigation is ongoing and the outcome of the investigation is unknown. The special committee has hired special counsel to assist in its investigation.
Customers of Reddy Ice and its biggest rival, Arctic Glacier out of Winnipeg, have started filing class action lawsuits for price fixing — three by our count so far in Minneapolis alone.
Blawgletter expects to see one or more similar filings in Dallas federal court soon.