NEWS RELEASE
Office of Maryland Attorney General J. Joseph Curran, Jr.


June 5, 2000 Media Inquiries: Sean Caine 410-576-6357

ATTORNEY GENERAL CURRAN ANNOUNCES SETTLEMENT IN TOILET PAPER PRICE-FIXING CASE

Baltimore - Attorney General J. Joseph Curran, Jr., announced today that the state of Maryland has settled a price-fixing case brought against six major manufacturers of commercial tissue products. Under this settlement, the state of Maryland will receive $175,000 in cash and tissue products with a retail value in excess of $500,000.

The defendants in this case, brought in Baltimore City Circuit Court, are Kimberly-Clark Corporation, Fort James Corporation, Bay West Paper Co., Encore Paper Co., Marcal Paper Mills, Inc. and, Wisconsin Tissue Mills, Inc. New York and West Virginia, which also sued these defendants, were also parties to the settlement agreement.

Curran's lawsuit alleged that the defendants conspired to raise the price of commercial tissue products beginning in 1993. Commercial tissue products include toilet paper, paper towels, toilet seat covers and cafeteria napkins. Commercial tissue products are purchased for use in state and local governmental offices and facilities as opposed to products purchased for home use by consumers.

The state's complaint alleged that by communicating their intentions to raise prices to each other directly or through third parties, like wholesalers, the defendants could determine when a price increase would be "supported" by the industry. Industry support was vital to the success of price increases. The state claimed that these increases were illegal and caused the state and its subdivisions to pay more for commercial tissue products than they would have paid in a market free of collusion. The defendants deny these allegations.

"These companies conspired to raise their prices in a collective effort to gouge the state of Maryland and its taxpayers," Attorney General Curran said. "I am pleased with this settlement and hope it sends a message that price-fixing will not be tolerated in this state."

The $175,000 cash recovery will be distributed among Maryland's counties, school boards and towns. The product component of the settlement will reimburse the state and will be distributed over a three year period.

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