Judge halts action over alleged cement cartel

A HIGH COURT judge has halted an action by three companies of businessman Séamus Maye alleging they were forced out of business due to the alleged operation by cement giants CRH and Readymix of a cartel in the cement industry. The defendants denied any such cartel.

Mr Justice John Cooke ruled yesterday the “manifestly inordinate” and inexcusable delay by the plaintiffs in prosecuting the case since initiating it in late 1996 had seriously prejudiced the defendants’ rights to a fair trial.

The “obvious and serious prejudice” to the defendants outweighed any detriment at this stage to the plaintiff companies and their unidentified creditors of refusing to allow the trial proceed, he ruled.

Some key witnesses had died, while others had said they had difficulty recollecting events and conversations alleged to have occurred in the 1990s, he said. Mr Maye’s scepticism about the inability of some people to recollect alleged conversations was “not an answer” to the prejudice claims.

Among retired CRH and related companies personnel said to have no reliable memory of certain alleged matters were Art Shiran – alleged to have had the specific duty “to supervise such cartels” – Declan Doyle, a Mr Gilmore, Tony O’Loughlin, Martin Mac Aodha and John McNerney, the judge noted.

Two Kilsaran personnel – Kevin McKeown and Richard Adair – had died, while its former operations manager Joe Doyle was said to be unable or unwilling to give evidence. It was also claimed there would be difficulty verifying the attendance of the current Kilsaran managing director, Dermot McKeown, at alleged meetings.

George Eyre, now aged 80, alleged to have been responsible for the CPI Ltd account with Ascon, was also said to be unable to attend at a trial, the judge noted.

The proceedings were initiated in 1996 by three related companies, Framus, Amantiss and Wilbury. Framus ceased trading in 1993 and the other two were placed in voluntary liquidation in April 1994.

The companies alleged CRH and its subsidiaries, Readymix and Kilsaran, abused dominant positions in cement and concrete markets, conspired to fix prices and forced the plaintiffs out of business between 1993 and 1994.

In his 40-page judgment granting the defendants’ application to stop the case, the judge noted it was initiated in December 1996 and a statement of claim (a document outlining the allegations) was delivered in 1998. An affidavit of discovery provided by the plaintiffs to the defendants in December 2005 was the last step taken in the proceedings until June 2011, when a notice of intention to proceed was served.

The judge found, from delivery of the claim in 1998, that the companies were in a position to provide evidence based upon conversations between their directors, including Mr Maye, and representatives of the defendants. There was reference to a particular meeting between Mr Maye and executives of CRH companies at which it was alleged the executives made explicit threats to eliminate the plaintiff companies from the relevant markets, he noted.

Specific instances of anti-competitive conduct were also alleged on the part of representatives of Kilsaran and Readymix. Other specified claims included that Seán Quinn of Quinn Cement told Mr Maye in March 1991 that persons in the Galway concrete products market had said in Mr Quinn’s presence they would “hang Maye out to dry”.

Such examples made it very difficult to understand what sort of evidence Mr Maye felt was needed from inside a cartel before the case could be prosecuted, the judge said.

The combination of direct testimony of Mr Maye, his brother Francis and other plaintiff company representatives, plus witness summonses, sworn responses from the defendants to specific questions, discovery and other procedural instruments would seem to have been capable of going a great distance in establishing a prima facie case that the infringements had occurred so as to put the defendants in a position of having to explain their conduct in evidence, he said.

On those and other grounds, Mr Justice Cooke rejected arguments that the plaintiffs faced insurmountable obstacles preventing them prosecuting the action from 2004 onwards. He also rejected claims that the financial difficulties of the companies or ill-health of Mr Maye and the death of his son in a car accident in 2008 were factors excusing the delay.