KAMLOOPS, British Columbia (CN) - A Canadian municipality is leading a price-fixing class action claiming suppliers of PVC pipes conspired to artificially inflate the price of the pipes following Covid-19 pandemic-related lockdowns.
The city of Kamloops, a small city of just under 100,000 in British Columbia's interior region, sued just over two dozen PVC pipe suppliers, including Atkore, Inc. and several related companies, Aliaxis North America Inc., Cantex, Inc., Oil Price Information Service LLC and more.
"The defendants conspired to use temporary price increases associated with Covid-era supply chain issues as an opportunity to artificially maintain inflated prices after raw material prices fell to pre-Covid levels," the city claims in its lawsuit. "The defendants performed their agreement by sharing confidential pricing and other information directly with each other and through an information-exchange firm."
Kamloops noted the cost of PVC resin roughly doubled between 2019 and 2022, alongside supply chain issues that impacted numerous sectors. But by January 2023, the price of the resin had fallen back down to around pre-pandemic levels and has remained relatively stable since, Kamloops claims.
That drop in resin prices, however, did not translate into falling prices for PVC pipe buyers, Kamloops says.
Instead, the city claims in the suit filed Friday that it translated into artificially high profits for the supplier in violation of Canada's Competition Act.
Kamloops claimed Oil Price Information Service worked with the manufacturers to share sensitive information to facilitate the price-fixing.
"This included facilitating the exchange of confidential, proprietary, and competitively sensitive data between and among the Manufacturer Defendants, and communicating for the purpose of ensuring the Manufacturer Defendants kept to their unlawful agreement," the city writes.
OPIS started as an oil price reporting agency, but has grown to provide market news, data and analysis on various oil-related products, including PVC.
"OPIS purports to provide 'public transparency' across supply chains so that 'all stakeholders can buy and sell' with confidence. However, in reality OPIS provides a service that has repeatedly been used to manipulate prices," Kamloops claims.
Oil Price Information Service settled a similar class action in the U.S. earlier this year, agreeing to pay $6 million and to cooperate with ongoing litigation against the remaining defendants, including a number of those named in the Kamloops lawsuit.
Kamloops said it relies heavily on PVC piping for its water and electrical systems and noted it faces challenges, such as a low density population spread out over 116 square miles and high water demand during dry summers in a semi-arid climate.
"As part of its water and electrical systems, Kamloops purchases large quantities of PVC pipes annually. It purchases pipes both from distributors and through general contractors who purchase pipes as components of completing infrastructure projects," the city says.
That adds up to millions of dollars spent in the time the city claims the defendants were fixing prices.
And it's not alone - communities across Canada are increasingly using PVC pipes to replace aging infrastructure, according to Kamloops.
This comes at a time in which Canadian communities are facing the high cost of replacing crumbling infrastructure. Statistics Canada has estimated the cost of replacing water infrastructure rated "poor" or "very poor" condition to be $106.5 billion.
That's based on a 2022 survey, which itself was a $20.1-billion increase over the previous survey in 2020.
The defendants and lawyers for the plaintiff did not immediately respond to a request for comment..
Courthouse News reporter Dustin Godfrey is based in Vancouver, Canada.
Source: Courthouse News Service
