What happened
A Texas storage sales company owner has pled guilty to two felony counts for conspiring to rig bids and defraud the U.S. Department of War in connection with shelving and storage products sold for U.S. Air Force healthcare facilities, the Justice Department’s Antitrust Division said.
The department said Eric J. Caddy, 62, of Huntington, Texas, entered the plea in the U.S. District Court for the Middle District of Georgia, where prosecutors filed an information and plea agreement tied to multiple healthcare-related projects at Air Force Base Moody in Valdosta, Georgia.
According to DOJ, Caddy and co-conspirators submitted collusive bids for the Medical Logistics Warehouse Project, the Pharmacy Modernization and Renovation Project, the Veterinary Clinic Project and the Dental Lab Clinic Project. The department said one co-conspirator directed Caddy to submit intentionally higher prices and provided the pricing to include on the bids.
DOJ said Caddy submitted the bids to a prime vendor for the federal government, which then submitted them to the U.S. Department of War. Prosecutors also said Caddy and his co-conspirators concealed the bid rigging by having Caddy rewrite certain bid forms in his own handwriting before transmitting them.
The projects totaled more than $1.6 million and were funded through the Defense Logistics Agency’s Facilities Maintenance, Repair, and Operations Program, according to the department. DOJ described the plea as the first in an ongoing investigation into bid rigging and fraud affecting U.S. military facilities in the United States.
The charged conduct carries substantial potential penalties. DOJ said an individual convicted of Sherman Act bid-rigging conspiracy faces up to 10 years in prison and a $1 million criminal fine, while conspiracy to defraud the United States carries up to five years in prison and a $250,000 fine, with possible fine enhancements tied to gain or victim loss.
Caddy is scheduled to be sentenced June 25. DOJ said a federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.