The Justice Department has expanded its 17-state bid-rigging investigation to Maryland's asphalt and construction industries, demanding records of two statewide trade associations and numerous private contracting firms on behalf of a federal grand jury in Baltimore.
The subpoenas issued in Maryland are broad in scope and go beyond road paving -- the focus so far of a Northern Virginia probe that has led to seven indictments and five guilty pleas -- to construction projects involving airport runways, bridges and ramps as well as highways.
Officials of the Maryland Highways Contractors Association and the Maryland Asphalt Association said yesterday both groups received subpoenas in late March from Justice's mid-Atlantic office in Philadelphia seeking voluminous paving-contract files dating to 1977.
The records are to be presented July 13 to the grand jury, which has been probing alleged bidding irregularities since earlier this year. Both trade groups said they would comply with the subpoenas.
Arnold Gardner, executive director of the asphalt association, said records of "some" private contractors belonging to the trade group he heads also have been subpoenaed by the grand jury, but he declined to identify them. At least one contractor in Washington's Maryland suburbs is included, according to a defense attorney.
Justice officials yesterday refused to comment on the investigation, but Frederick Gottemoeller, deputy state highway administrator, said records including lists of bidders have been turned over voluntarily to federal investigators. Assistant state attorney general Charles Monk, head of the antitrust division, said his office also is sharing results of a parallel state probe with Justice.
The nine-month federal investigation of Northern Virginia's asphalt paving industry has led recently to guilty pleas by an Alexandria paving firm and four executives. A grand jury in Alexandria on Wednesday indicted four companies -- including a Baltimore firm -- and three individuals on conspiracy and mail fraud charges. All seven defendants are scheduled for arraignment on Monday.
Plato Cacheris, attorney for one of the firms subpoenaed, said the government request includes telephone and visitor logs, desk calendars, books and records, company ownership data, travel vouchers, bid estimates, contracts and subcontracts and information on business volume involving both federal and state contracts.
"We're going to give them everything -- about four file drawers full," said William E. Hardy, executive secretary of the highways contractors trade group. Both Hardy and Gardner said their associations serve as information resource centers and are not involved in bidding.
Assistant Attorney General Monk said yesterday the broad subpoenas are aimed generally at establishing industry patterns in Maryland. "If you're suspicious, you want some idea of the actors in the marketplace," he said. Costs and physical limits on how far heated asphalt can be hauled mean that if "contractor A won a contract near contractor B's plant, it merits further attention," said Monk.
A Justice spokesman said the Baltimore grand jury's investigation has resulted in neither indictments nor preindictment pleas thus far. Government attorneys have prosecuted cases of alleged bid rigging in 11 states to date and are presenting evidence to grand juries in 17 states, he said.