Tahoe Donner residents sue over alleged snow removal price fixing
January 26, 2018
Two Tahoe Donner homeowners have filed a class-action lawsuit that alleges Snowtech Inc. and Waltman Construction Inc. fixed prices for snow removal services sold to residents of Tahoe Donner for almost a decade.
The complaint was filed by Michael J Cramer and Brian Paddock in Nevada County Superior Court, and alleges that "Snowtech and Waltman would agree, each year, to set the prices charged to Tahoe Donner residents for the upcoming season," according to a statement.
The companies are further alleged to have worked closely to ensure that neither company offered Tahoe Donner residents any better snow removal services than the other did.
In March of 2017, SnowTech Inc. merged with Waltman Construction Inc., while Waltman simultaneously changed their business name to Elements Mountain Co., ceasing SnowTech Inc. to technically exist.
Tahoe Donner is one of the nation's largest homeowners associations, and is located in Truckee.
The complaint specifically details that, "The CONSPIRACY, moreover, involved agreements to suppress competition between SNOWTECH and WALTMAN as to quality of snow removal services provided — including, for example, agreeing on start times and end times for plowing services, agreeing on start and end dates for contracts."
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More into the body of the complaint are emails allegedly between Snowtech's President, Matthew Warren, and Waltman's previous owner, Jamie Legare, formally recognized as Jamie Waltman.
In the emails, the agreement to fix prices read in part as, "Price – we have agreed that the minimum price in TD [Tahoe Donner] will be $625." Another refers to actions to be taken "in the interest of placating homeowners on pricing" and to "give the perception that there is a little bit of competitive pricing happening in TD [Tahoe Donner]."
Stuart Gross of Gross & Klein LLP, who represents the plaintiffs and proposed class with co-counsel, stated, "As alleged in the complaint, Snowtech and Waltman explicitly agreed to fix the prices charged to Tahoe Donner residents for snow removal services. That's illegal, and for good reason. Free competition is a lynch pin of our economic system; and these companies are alleged to have tossed that pin out."
Gross continued, "This was not a case in which companies on the ropes resorted to illegal price-fixing as a last ditch effort to survive. Rather, as alleged in the complaint, the illegal conspiracy was hatched to cynically prevent 'money from being left on the table.' Engaging in lawful competition is not leaving money on the table."
Elements Mountain Co. currently dominates the market for snow removal services in the Tahoe Donner area. As alleged in the complaint, part of the defendants' plan for false perception of competition included a "price match guarantee" in solicitations sent to Tahoe Donner residents. As there was no real competition between these two companies before the merger, the "guarantees" are alleged to be simply classic examples of false advertising.
The complaint also makes 10 claims against Elements Mountain Co., as well as some claims against Jamie Legare, Joanne Waltman, and Matthew Warren. The complaint also includes alleged violations of the California Cartwright Act, which forbids price-fixing, as well as unfair competition, false advertising, and breaking contract laws.
"We were recently notified of this complaint and have retained counsel. On the advice of our lawyers, we cannot provide any additional comment at this time," Warren said. "Waltman, SnowTech, and now Elements, have worked hard to provide our customers with excellent snow removal service and value. We're committed to continuing to improve our customer's winter home access."
Jamie Legare was contacted and while she could not comment on an impending lawsuit, she did say she plans on fighting the lawsuit vigorously.
A chief management conference is set for June 2018.
Kelsie Longerbeam is the news, business and environment reporter for the Sierra Sun and North Lake Tahoe Bonanza. She can be contacted at firstname.lastname@example.org or 530-550-2653. Follow her on Facebook, and Twitter and Instagram @kelsielongerbm.
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