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Justice's Antitrust Division Probes Paper Product Sales : Commerce: Federal investigators demand documents on pricing and distribution practices from 1990 to 1994.

December 29, 1994|From Bloomberg Business News

WASHINGTON — Some of America's biggest paper companies have been contacted by Justice Department investigators as part of a federal antitrust investigation into commercial and industrial sales of toilet tissue and paper towels.

Companies that received demands for documents in recent weeks include Georgia Pacific Corp., James River Corp., Scott Paper Co., Fort Howard Corp. and Chesapeake Corp. The civil investigative demands ask for information about pricing and distribution practices during the period from 1990 to 1994.

The Justice Department confirmed Wednesday that investigators are probing possible restraint of trade in paper sales. News of the investigation was first reported last week by Bloomberg Business News.

"We are looking at the possibility of anti-competitive practices in the sanitary paper industry," said Gina Talamona, spokeswoman for the department's Antitrust Division.

Sheila Weidman, a spokeswoman for Atlanta-based Georgia Pacific, said the department request is "fairly broad in scope about the commercial side of our tissue business." She said the company has been told that the federal inquiry is preliminary in nature.

In Richmond, Va., James River Corp. spokesman John Burke said investigators sought information about "our sales and pricing of sanitary paper products sold to the industrial and commercial markets--hotels, offices and that kind of thing."

A memo distributed to executives at Richmond-based Chesapeake Corp. said authorities asked for information about pricing practices by the firm's Wisconsin Tissue subsidiary.

Greta Thomson, a spokeswoman at Scott Paper's Philadelphia headquarters, also confirmed receipt of a federal demand for documents. Fort Howard Corp. in Green Bay, Wis., acknowledged its inclusion in the investigation in a filing with the Securities and Exchange Commission.

Officials at Kimberly-Clark Co. in Dallas did not return calls seeking comment.

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