US firms sue container makers over alleged price-fixing scheme

The lawsuits, filed separately by manufacturer CA Spalding Company and shipping company Daybreak Express earlier this month, seek monetary damages and follow closely on the heels of a US Department of Justice indictment unveiled in late May. Both suits name Singamas, China International Marine Containers (CIMC), CXIC Group Containers and several executives, including Singamas boss SS Teo, alleging they participated in a long-running scheme to manipulate prices in the dry container sector.

CA Spalding, a supplier of components to the aerospace, automotive and other industrial sectors, claims the alleged conspiracy forced it to pay inflated shipping costs by artificially increasing container prices. The company is seeking multiple damages under US antitrust laws.

The civil actions stem from allegations by the US Department of Justice that the container manufacturers, which together account for around 95% of global standard dry container production, coordinated output restrictions and pricing between November 2019 and January 2024.      Federal prosecutors allege the companies limited production through measures including restricting operating hours on container production lines, installing video surveillance systems and agreeing not to build new container manufacturing facilities.

According to the indictment, these actions contributed to standard dry container prices roughly doubling between 2019 and 2021, while profits at container manufacturing companies increased by around 100 times during the same period.

The Justice Department said the alleged conspiracy harmed major US-based container lessors, shipping lines and logistics companies, ultimately resulting in higher costs for American consumers.       Dry containers, the standard unrefrigerated boxes used throughout global trade, carry billions of dollars worth of goods into the United States each year.      Court documents released by US prosecutors include details of a December 2019 meeting between executives from the accused companies.    Teo, one of the most high-profile names in Singapore shipping for his running of Pacific International Lines (PIL), has previously said he intends to contest the allegations.