August 2, 2012
Attorney General Kelly announces suit over use of foreign steel products in public works projects
HARRISBURG - The Attorney General's Antitrust section has filed legal action against several Allegheny County companies, along with their owners and directors, accused of installing foreign steel products in public works projects, in violation of state law.
Attorney General Linda Kelly said the civil complaint, filed today in the Commonwealth Court of Pennsylvania, names Ryco Fire Protection Services, LLC, of 1215 Market St., McKeesport, along with Ryco Fire Protection Services, LP; Ryco Plumbing, LLC; Ryco Plumbing, LP; Ryco Plumbing II, LLC; Ryco Plumbing II, LP; and Ryco, Inc., all sharing the same address.
The civil suit also names Thomas Sherry, Jr., the President of Ryco, Inc.; Susan E. Sherry, the Secretary and Treasurer of Ryco, Inc.; Richard Bosco, Vice President of Ryco, Inc.; and other unidentified officers, owners and directors of these businesses.
"According to the complaint, Ryco used hundreds of fittings and hangers made in China and Poland during the installation of fire protection systems that were part of public works projects requiring the use of steel from the United States," Kelly said. "These lower-cost foreign steel products were allegedly installed by Ryco during projects involving student housing at the Indiana University of Pennsylvania and school renovations for the Blairsville-Saltzburg School District."
Kelly said the defendants are accused of violating the Pennsylvania Steel Products Procurement Act, the Unfair Trade Practices and Consumer Protection law and the Pennsylvania Corrupt Organizations Act.
According to the complaint, Ryco officials submitted certifications that the materials used in these projects complied with the Steel Products Procurement Act and were manufactured in the United States, but the investigation revealed numerous pipes and fittings that were clearly marked as being produced overseas.
"Many of the foreign-made items discovered during the course of this investigation cost substantially less than the required US-made fittings," Kelly said. "The use of these non-certified and less-expensive materials generated excess profits for Ryco and allowed the company to unfairly compete against other contractors who were complying with the law."
The total value of the Ryco contracts for fire protection systems in the IUP and Blairsville-Saltzburg School District projects totaled more than $800,000.
Kelly noted that this remains an active and ongoing investigation into the possible use of lower-cost foreign steel products in Pennsylvania public works projects.
The complaint asks the court to order civil penalties of up to $1,000 for each violation and other relief, along with recovery of any payments that were made to Ryco under these contracts and the cost of the investigation.
Additionally, the lawsuit seeks to prohibit Ryco and the other defendants from submitting bids or supplying materials to any public agency in Pennsylvania or any state contract for a five year period.
The lawsuit was filed in Commonwealth Court by Chief Deputy Attorney General James A. Donahue III and Deputy Attorney General Norman W. Marden of the Attorney General's Antitrust Section.