Des Moines may sue over fire truck prices
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Photo: Courtesy of the city of DSM
Des Moines plans to file an antitrust lawsuit saying fire truck manufacturers and suppliers inflated prices for trucks and equipment, city manager Scott Sanders tells Axios.
Why it matters: The equipment is among the city's most expensive, and a successful lawsuit could recover money as local budgets tighten.
Driving the news: The City Council last week approved hiring outside counsel to assist with an antitrust and unfair competition lawsuit against unnamed suppliers and companies.
- The attorneys include lawyers from Baron & Budd and Simonsen Sussman, both out-of-state firms connected to similar fire-apparatus litigation.
Catch up quick: Cities and counties across the country are suing major fire truck manufacturers, saying that the manufacturers consolidated the market, restricted supply and drove up prices.
- San Diego says the companies forced cities and fire departments to pay inflated prices for lifesaving equipment and that overcharges reached "hundreds of thousands of dollars per unit."
- Los Angeles County filed a similar lawsuit to recover overcharges and "unwind anticompetitive mergers."
- Green Bay's lawsuit was recently consolidated into a broader federal case involving municipalities from multiple states that points to incidents dating back to at least January 2016.
The other side: A spokesperson for American Industrial Partners (AIP), a private equity firm accused in lawsuits of backing the consolidation of fire apparatus manufacturers, told The Wall Street Journal that the firm will "defend itself vigorously" against the claims.
- REV Group, a fire truck manufacturer that AIP formed in 2006, says a lawsuit in Los Angeles County is meritless, a spokesperson told Courthouse News Service.
State of play: The city of Des Moines has spent over $12 million on major fire apparatuses since January 2016, according to council resolutions reviewed by Axios.
- The largest was a nearly $5.1 million purchase last year for two pumpers and a ladder truck.
Yes, but: Purchases are often made through dealerships or subsidiaries of larger companies, making it difficult to match them to companies named in other lawsuits.
- An estimate of what the city believes it overpaid has not yet been created, Sanders said this week.
What we're watching: When and where DSM files its lawsuit.
- Sanders said the city will "eventually file suit in the appropriate jurisdiction."