A former president and general manager of Allegheny Pepsi-Cola Bottling Co. was charged yesterday with conspiring to fix prices of soft drinks sold in the Norfolk and Richmond areas.
The one-count felony charge against James P. Sheridan was filed in U.S. District Court in Norfolk as part of the Justice Department's investigation into price fixing in the soft-drink industry.
Sheridan conspired during meetings and telephone conversations with unnamed coconspirators to set promotional prices for soft drinks and decided when to raise or lower them, according to court papers filed in the case.
Those actions, which occurred between February 1983 and the end of 1984, deprived customers of the opportunity to purchase certain soft drinks in an open and competitive market, a violation of the Sherman Act, court documents said.
Allegheny Beverage Corp., a Cheverly-based diversified services company, was the parent of Allegheny Pepsi during the time covered by the charges brought against Sheridan. Allegheny Pepsi was sold to Pepsi-Cola Bottling Group, the PepsiCo Inc.-owned bottling system, by Allegheny Beverage in 1985.
Pepsi-Cola Bottling officials could not be reached for comment yesterday. They said earlier that they were aware of the investigation when they bought the bottler for $160 million in May 1985.
Allegheny Beverage Corp. officials yesterday said that they had no knowledge of the charges against Sheridan.
Sheridan is the second executive or former executive of Allegheny Pepsi to be charged in the price-fixing investigation. Armand Gravely, a vice president and manager of Allegheny Pepsi's Richmond division, was recently found guilty in U.S. District Court in Norfolk of conspiring to fix prices and obstructing justice. He was sentenced to four months in jail and fined $15,000.
During Gravely's trial, Morton M. Lapides, chairman of Allegheny Beverage Corp., was named as an unindicted coconspirator.
In its investigation of soft-drink price fixing, which has lasted for more than two years, the Justice Department has brought charges in two other cases.
Edward Leon Wynns of Silver Spring, a senior vice president for Mid-Atlantic Coca-Cola Bottling Co. Inc., was indicted by a federal grand jury in May on charges of lying to a Norfolk grand jury that was investigating price fixing.
And last fall, General Cinema Beverages of Washington, the area's Pepsi-Cola bottler, was fined $1 million after pleading guilty in U.S. District Court to conspiring to fix wholesale prices for Pepsi and Coke products.
A separate class-action lawsuit was filed last year on behalf of local grocery stores, vending companies and other customers of Coke and Pepsi bottlers alleging that price fixing by the two had added millions of dollars to the cost of soft drinks.
The maximum penalty Sheridan could receive is three years in prison and a $100,000 fine.