Multiple Buyers Are Filing Federal Suits Against Promotional Products Companies Charged in Price Fixing Scheme
In August, the owner and CEO of Custom Wristbands, a promotional wristband company, pleaded guilty in a price fixing scheme with other promotional products companies. That news came just a few weeks after Houston-based Zaappaaz Inc., which also specialized in custom wristbands, pleaded guilty to violating the Sherman Antitrust Act.
The two companies, along with others, were discovered when Victor Rey, owner of Houston-based Wristband Connection, noticed "unusual pricing patterns in silicone gel wristbands that suggested other sellers were acting in unison," according to the Houston Chronicle.
In 2016, Rey was offered a chance to join the price fixing ring over lunch with a competitor, and gave the information to the FBI.
In addition to the hefty fines the guilty parties have to pay out ($1.9 million for Zaappaaz and $409,000 for Custom Wristbands) customers are seeking class action status to represent thousands of other customers and ensure refunds for the money they overpaid, as well as damages. Multiple civil cases have been filed relating to the price fixing activity.
Considering the two main players in question here admitted to guilt and paid the fines, it would be hard for them to deny accountability and refuse refunds.
"I don't think we're chasing an empty cupboard," Fred Taylor Isquith, the lawyer who filed the first civil case last year, told the Houston Chronicle.
A hearing is scheduled for May in Houston to determine whether the multiple existing civil cases will be consolidated into one.