K-Line Executive Pleads Guilty to Price Fixing

An executive of Japan-based Kawasaki Kisen Kaisha Ltd. (K-Line) was sentenced to 18 months in a U.S. prison after pleading guilty to his involvement in a conspiracy to fix prices, allocate customers and rig bids of international ocean shipping services for roll-on, roll-off cargo to and from the United States and elsewhere, the Department of Justice announced. 

 

According to the one-count felony charge filed in U.S. District Court of the District of Maryland in Baltimore on Jan. 22, 2015, Toru Otoda, who was a general manager in K-Line’s car carrier division, conspired to allocate customers and routes, rig bids and fix prices for the sale of international ocean shipments of roll-on, roll-off cargo to and from the United States and elsewhere, including the Port of Baltimore. Otoda participated in the conspiracy from at least as early as November 2010 until at least September 2012. 

 

Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division, said, “This investigation will continue as we seek to prosecute the executives who conspired and the companies that employed them.” 

 

Pursuant to the plea agreement, which the court accepted yesterday, Otoda was sentenced to serve an 18-month prison term and pay a $20,000 criminal fine for his participation in the conspiracy. In addition, Otoda has agreed to assist the department in its ongoing investigation into the ocean shipping industry.

 

Otoda was charged with a violation of the Sherman Act, which carries a maximum sentence of 10 years in prison and a $1 million criminal fine for an individual. The maximum fine may be increased to twice the gain 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.

 

The sentence is the fourth against an individual in the division’s ocean shipping investigation, and the third against an individual from K-Line. Three corporations have agreed to plead guilty and to pay criminal fines totaling more than $136 million, including K-Line, which was sentenced to pay a criminal fine of $67.7 million.