Spitzer Announces Antitrust Settlement With Paper Products Manufacturers

Attorney General Spitzer today announced a multi-state settlement in an antitrust case against the nation's largest manufacturers of paper products.

The settlement between the states of New York, Maryland and West Virginia and leading paper manufacturers resolves a 1998 antitrust lawsuit, in which the companies were accused of fixing prices of commercial paper products.

"A basic principle of the marketplace is that competitors should act like competitors," Spitzer said. "When companies in the same industry act in lockstep on pricing decisions, it obviously raises questions about collusion.

"This settlement should send a strong message throughout the industry that New York and its partner states will be vigilant in protecting the interests and pocketbooks of consumers," the Attorney General said.

The defendants in the case, including the Fort James Corp., the Kimberly-Clark Corp., Encore Paper Co., and Marcal Paper Mills Co. -- admitted no wrongdoing, but have agreed to pay the three states $1.2 million in cash and commercial tissue products. New York State will receive nearly $500,000 in cash and commercial tissue products under the settlement.

The commercial tissue products recovered through the settlement will be distributed to a variety of organizations in each state, including schools, universities, correctional facilities, parks and recreational centers and psychiatric centers. The products will be distributed over the next three years.

The case was initiated in 1998 after the Attorney General's Antitrust Bureau investigated allegations of price fixing in the commercial tissue products market.

The case was handled by Assistant Attorneys General Robert L. Hubbard and John A. Ioannou, of Spitzer's Antitrust Bureau.

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