Competition Matters

When it works as it should, competitive bidding is a process where purchasers issue bids to vendors who proceed to assemble the best proposals possible to compete for the opportunity to provide specific products or services. This process is meant to foster a fair and transparent environment for vendors to compete for business, and for purchasers to get the best products or services at the lowest prices. Nevertheless, the competitive bidding process is undermined whenever vendors coordinate with each other to engage in anti-competitive practices such as bid-rigging.  Conspirators often use the latest technology to enact and conceal their schemes.

In April, Gary DeVoe, a Connecticut-based branch manager for an insulation contractor, pleaded guilty in federal court for his role in a scheme to rig bids on insulation installation contracts in Connecticut, Massachusetts, and New York. According to court documents, DeVoe and his co-conspirators used disappearing messaging technology to inflate bids on $45 million worth of projects to install insulation around pipes and ducts in hospitals, universities, and other public facilities and private businesses in those states. DeVoe and his co-conspirators engaged in this anti-competitive scheme at various times from 2011 to 2018. Despite their clever use of the latest technology, the scheme was uncovered.

The charge DeVoe faces for violating federal antitrust laws carries a maximum penalty of 10 years in prison and a $1 million fine for individuals.

If you suspect that your purchasing process has been impacted by unscrupulous vendor behavior like this, or have questions about how to recognize anti-competitive activity, please call the Antitrust Section of the Ohio Attorney General’s Office at 614-466-4328.