CHARLESTON – The president of a paving company at the center of an antitrust lawsuit says the West Virginia Division of Highways “acted hastily” in filing the complaint.
“It is clear from DOH’s actions to date and (DOH Legal Director Michael) Folio’s letter that the DOH acted hastily and with suspect information in filing suit against several paving companies, including West Virginia Paving,” Bob Brookover, president of West Virginia Paving, said in a statement.
Folio had sent a letter Feb. 7 to Marty Gearheart, who is the co-chairman of the Joint Legislative Oversight Commission on Department of Transportation Accountability. In December, lawmakers had asked Folio Folio why West Virginia Attorney General Patrick Morrisey’s office wasn’t more involved with the lawsuit, particularly when the DOT had joined the suits previously filed on behalf of the cities of Charleston, Parkersburg, Beckley, Bluefield and Huntington as well as the Kanawha County Commission. Folio said then the DOH was talking to the AG’s office, but couldn’t say much else at the time.
West Virginia Paving is one of 11asphalt and paving companies alleged to have violated the state’s Antitrust Act. Morrisey’s lawsuit, filed Jan. 11, claims the companies drove out competitors and pushed asphalt prices higher across a substantial portion of West Virginia via acquisition or non-compete agreements.
“Mr. Folio said in his letter that he believed filing the lawsuit would ‘reform West Virginia’s asphalt market,’” Brookover said. “On several occasions in the past, West Virginia Paving has offered solutions and feedback to the Division of Highways but those comments were never taken into consideration.
“At no point before the lawsuit did Mr. Folio reach out to West Virginia Paving to discuss concerns with its pricing or the markets for asphalt and asphalt paving.”
Brookover said his company would welcome a discussion with the DOH about these issues.
“We would love to participate in meaningful discourse aimed at tangible solutions,” he wrote, adding that a recent Deloitte audit of the DOH made several recommendations.
“The DOH has not even attempted to implement those recommendations,” Brookover wrote. “One of those suggestions was to ‘analyze the asphalt mix designs and specifications with different states in terms of quality and lifespan of finished product.’”
For example, Brookover said the DOH requires its contractors to be able to produce as many as 60 different mix designs, many of which he says are of questionable value.
“We have made this same suggestion to DOH on multiple occasions, which suggestion seems to have fallen on deaf ears,” Brookover said. “We believe that this simple step would result in a huge cost savings to the public and allow for more roads to be paved with longer lifespan of the finished product.”
Brookover said the Deloitte report also shows several factors that affect the price of asphalt and asphalt paving. “None of which have anything to do with the number of competitors manufacturing asphalt or performing asphalt paving,” he added.
“Those factors include proximity to asphalt plant locations, existing terrain conditions, and vicinity to aggregate quarries,” Brookover wrote. “Another large factor in the price of asphalt is the price of asphalt cement (also known as liquid asphalt). Liquid asphalt is a petroleum product produced by companies such as Marathon Oil and its price fluctuates with the price of oil much as the price of gasoline does.
“Neither West Virginia Paving nor any of the other paving companies attacked by DOH and Mr. Folio have anything to do with the production or price of asphalt cement.”
Brookover said he thinks it’s clear that Folio is looking “to pass the blame of DOH’s inaction and inefficiency onto hard working West Virginians who work day and night to provide safe roads for everyone to travel.”
“We have reached out to the Attorney General and look forward to a solution-driven discussion about how we can better serve the people of West Virginia,” Brookover wrote. “We are also sending a letter to the Joint Committee to start a conversation about how we can create solutions to any concerns they may have.
“Solutions will be found through open and honest dialogue, not through legal action that threatens the livelihoods of hundreds of West Virginians.”
He said his company won’t go down without a fight.
“We will continue to fight these unfounded, slanderous allegations on behalf of the 350 West Virginia workers who will continue to work tirelessly to ensure that our friends, families and fellow West Virginians have safe roads to drive on every day,” Brookover wrote.
Kanawha Circuit Court case number: 17-C-41