Two business owners accused of rigging bids for wildfire-fighting equipment
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BOISE – Two executives were indicted last week after allegedly defrauding the U.S. Forest Service and other federal and state agencies over truck contracts for fighting wildfires.
Ike Tomlinson, 60, of Terreton, and Kris Bird, 61, of Salmon, were each indicted by a grand jury on one count of felony conspiracy to commit wire fraud, five counts of felony wire fraud, one count of conspiracy in restraint of trade: bid rigging, and territorial allocation.
Tomlinson and Bird, who own competing companies, conspired to “rig bids and allocate territories,” violating the Sherman Act, according to a news release from the United States Attorney’s Office District of Idaho.
The Federal Trade Commission says the Sherman Act of 1890 outlaws “every contract, combination or conspiracy in restraint of trade,” and any “monopolization, attempted monopolization, or conspiracy or combination to monopolize.”
The indictment says that to secure the best deal for taxpayers and promote free and fair competition, the U.S. Forest Service advertises and runs a bidding process to award certain firefighting-related contracts to qualified small businesses.
These vendors supply fuel trucks, water trucks, communications trailers and more.
The Forest Service awards contracts to vendors based on the service they provide in a location at a price determined during the bidding process. Then, when wildfires occur, state and federal agencies will rely on those contracts to order and dispatch equipment on short notice.
The indictment stated that the U.S. Forest Service expects vendors’ bids to be “competitive and confidential,” stating that companies compete with each other to have the lowest-priced bid and to be the higher on the dispatch priority list.
According to the felony indictment, Tomlinson and Bird worked together to affect the contracts for forest firefighting services to make the most money possible.
The indictment alleges that from at least in or about February 2014, up to about March 2023, Tomlinson and Bird coordinated their bids to “squeeze” and “drown” competitors, accepted payment for fuel trucks at collusive and noncompetitive daily rates, and tried to conceal their actions.
“This investigation was conducted by the department’s Procurement Collusion Strike Force (PCSF), which included FBI agents, with judicial authorization, intercepting phone calls between Tomlinson and Bird,” states the release. “As alleged, Tomlinson and Bird spoke with one another shortly before the deadline to submit bids on fuel truck contracts. During calls quoted in the indictment, they allegedly agreed to rig bids, allocate territories, and target competitors.”
Text conversation between Tomlinson and Bird
The indictment quotes a text conversation between Tomlinson and Bird, where the two are discussing raising the prices for water tenders, also known as water tankers, essential firefighting equipment used to transport water from a water source to a fire.
Tomlinson: Got my water tenders in. Did not put any in salmon. FYI.
Bird: You are the man!! If you wan to put a couple here for a high amount I don’t really care!
Tomlinson: I think I might do that. What should I bid?
Bird: All find out what my bid was and then maybe we’ll both raise them. (laughing emoji)
Tomlinson: K just let me know Thanks
Other conversations
The indictment also states that in 2020, Tomlinson admitted to his ongoing collusion with Bird in a recorded conversation, suggesting to an unnamed individual that if they did not work together, the individual would “make no money.”
The indictment quotes the conversation where Tomlinson told the person:
“As far as the fuel trucks go, I mean it’s just like – you know how Kris Bird and I work together? We basically talk once or twice a year and decide what we’re going to do. And — we work it out. Now, if I wasn’t honest and didn’t work it out with you guys that year, trust is gone, we’re done. You know what I mean? We’re back to battling but — and if we’re back to battling, when we’re both back to making no money. You see what I’m saying?”
Tomlinson then suggested the individual could “buy all the trailers” and himself and Bird would “do the fuel trucks” allowing them to “have an agreement where we don’t compete against each other.”
The indictment says the other person told Tomlinson that his collusion with Bird was illegal, but the two continued anyway.
Through a wiretap on Tomlinson’s cell phone, investigators heard Tomlinson and Bird discussing how to push other potential contractors out of the bidding process, with Bird being allegedly saying, “We could punch them suckers down so that it hurts ’em.”
Possibility of fines and prison
According to the release, a violation of the Sherman Act carries a maximum penalty of 10 years in federal prison and a $1 million fine for individuals and a maximum penalty of a $100 million fine for corporations.
The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than the maximum.
A violation of the wire fraud statute carries a maximum penalty of 20 years in federal prison. A federal district court judge will determine any sentence after considering the U.S. sentencing guidelines and other statutory factors.
The Antitrust Division’s San Francisco Office, U.S. Attorney’s Office for the District of Idaho, and FBI Salt Lake City Field Office, Boise Resident Agency, are investigating the case.
Trial Attorney Matthew Chou and Assistant Chief Christopher J. Carlberg of the Antitrust Division’s San Francisco Office and Assistant U.S. Attorney Sean Mazorol for the District of Idaho are prosecuting.
In November 2019, the Justice Department created the PCSF, a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant and program funding at all levels of government – federal, state and local. To learn more about the PCSF, or to report information on bid rigging, price fixing, market allocation, and other anticompetitive conduct related to government spending, click here.
Anyone with information in connection with this investigation can contact the PCSF here.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.