27 June 2003: Proceedings were instituted in the Federal Court, Perth, alleging that between September and November 2001 company representatives had several meetings and telephone conversations during which they reached price fixing arrangements or understandings about bricks supplied to builders in Western Australia.
It was alleged the arrangement contained a provision that the prices for all clay brick products supplied by Metro and/or Midland would increase by approximately 3 per cent for trade builders in or about October 2001 and for major builders in or about January 2002.
It was also alleged the companies reached an agreement or understanding that the tender price at which Metro Brick was to supply Verticore, and Midland Brick was to supply Maxibrick to major builders would not be below $570 per thousand bricks.
In January 2002 Boral Ltd, of which Midland Brick is a wholly-owned subsidiary, approached the ACCC and voluntarily disclosed the potential contraventions. Metro Brick and Mr Scott also fully cooperated with the ACCC’s investigation.
The ACCC sought declarations, injunctions, pecuniary penalties, other remedial orders and costs.
28 November 2003: A directions hearing was listed.
17 March 2004: A hearing was listed.
9 June 2004: Justice Lee made orders by consent and declared that Metro Brick had contravened the price fixing provisions of the Act and imposed a $1 million penalty, granted an injunction restraining Metro Brick from engaging in similar conduct for five years, and ordered Metro Brick to implement a compliance program and pay ACCC costs.
Mr Scott, a senior manager of Metro Brick, also consented to declarations, an injunction and a pecuniary penalty. Although the ACCC and Mr Scott had suggested a penalty of $50 000 the court decided the appropriate penalty was $25 000.
By consent the court declared that Midland Brick had contravened the Act by reaching the agreements with Metro Brick and by giving effect to one of them, granted an injunction restraining Midland Brick from engaging in similar conduct for five years, and to pay ACCC costs. No pecuniary penalty was sought from Midland Brick or from its senior manager involved in the conduct.
