FOR IMMEDIATE RELEASE|
MONDAY, FEBRUARY 28, 2005
TDD (202) 514-1888
NEW YORK LINEN SUPPLY COMPANY AND ITS OWNER PLEAD GUILTY
TO ALLOCATING CUSTOMERS
WASHINGTON, D.C. -- A Lindenhurst, New York linen supply company and its owner pleaded guilty today to participating in a conspiracy to allocate customers for linen supply services in the New York City metropolitan area, the Justice Department announced.
Polo Linen Service Inc. and its owner, Anthony Lampropoulos, a resident of Roslyn, New York, were charged in U.S. District Court in Manhattan with participating in a conspiracy from 1994 until September 2002 to allocate customers for linen supply services in New York City; portions of Westchester, Suffolk, and Nassau Counties, New York; portions of northern New Jersey; and portions of Fairfield County, Connecticut.
“Customer allocation agreements deprive businesses and consumers of competitive choices and prices, and we will remain vigilant in detecting and prosecuting this type of behavior,” said Scott D. Hammond, Deputy Assistant Attorney General in charge of Criminal Enforcement in the Department’s Antitrust Division.
Linen supply companies primarily supply restaurants, cafeterias, and caterers with laundered items such as table linens, napkins, chef’s uniforms, and aprons. Linen supplies are a significant cost of business for these establishments. During the period of this conspiracy, the defendants and co-conspirators generated sales revenues from the supply of linen services in the New York metropolitan area in excess of $500 million.
According to the charges, Polo Linen and other linen supply companies carried out the conspiracy by agreeing not to compete for each other’s customers, meeting to discuss and affirm their agreement, notifying each other when such customers were contemplating switching linen suppliers, and submitting intentionally high, non-competitive price quotes or refraining from submitting price quotes to such customers.
Polo Linen and Lampropoulos were charged with violating Section One of the Sherman
Act, which carries a maximum penalty of a $10 million fine for a corporation and a maximum penalty of three years imprisonment and a $350,000 fine for an individual for violations occurring before June 22, 2004. The 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.
In late 2003, White Plains Coat and Apron Company and its president, Bruce Botchman, pleaded guilty to similar charges of conspiring to allocate customers. White Plains Coat and Apron Company was sentenced August 13, 2004 to pay a $3.5 million fine. Last year, Joel Gorkowski, a former salesman for Cascade Coat and Linen Co., pleaded guilty to making false statements to a grand jury investigating the linen supply industry. Botchman and Gorkowski are awaiting sentencing.
Today’s charges resulted from an ongoing investigation of the linen supply industry being
conducted by the Division’s New York Field Office with assistance from the Federal Bureau of
Anyone with information concerning territorial or customer allocation or related offenses in the linen supply industry should contact the New York Office of the Antitrust Division at (212) 264-0390.