Garland Roofing Caught Bid Rigging in Los Angeles Schools

It may be "Old News", but history is important. For those of you who don't know it, a Garland rep who was a former Tremco rep, according to the Garland Regional Sales Manager, got caught along with the company, a contractor and two individuals in a Los Angeles area school roofing bid and had an Injunction placed against them for: Bid Rigging Vertical Price Fixing Horizontal Price Fixing Unlawful, Unfair or Fraudulent Business Practices Unfair, Deceptive, Untrue or Misleading Advertising Commercial Bribery 

Garland was forced to other measures, including but not limited to opening up the approved contractor's list. 

Some of the other measures included training their employees for five years not to unfairly compete. 

Garland was also ordered to pay $67,600, of which $30,000 was for civil penalties for unfair competition at $2,500 per violation (according to present-day Code Section), $27,600 for legal and investigative costs, and $10,000 in cy pres restitution. 

Defendant Prime Commercial was ordered to pay $11,500 for unfair competition. Defendant Henry Marsh was ordered to pay $11,500 for unfair competition. Defendant Robert Maiers was ordered to pay $10,000 for unfair competition. 

Essentially, the LA DA's offices let them off with a slap on the wrist....and the investigator told me that they wished they had done more after hearing the whole story.... 

So - did you ever hear about it? Here's the actual consent order: 

See: http://roofingscam.blogspot.com/2009_04_19_archive.html#7929549341180344241 and look at the first post, 

"Garland Consent Decree in Bid Rigging Case" 

For more on Garland, look here: 

30-year warranty discussed by the Midwest Roofing Contractor's Association former Testing Director: http://roofingscam.blogspot.com/2008_03_02_archive.html 

Look at the second post down, "Examining the 30-Year Warranty" Actual 30-year warranty: http://roofingscam.blogspot.com/2009_04_19_archive.html 

Look at the second post down, "GARLAND 30-YEAR WARRANTY" 

Overcharges: http://schoolroofingscam.blogspot.com/2008/02/comparable-costs-between-manufacturers.html "Comparable Costs Between Manufacturers in Oakland, CA School, 2005" 

Update on the Overcharges, May 9, 2009: A recent report from a roofing contractor shows that the overcharges have reached this range: "I almost passed out when they sent me the material price quotes for the Garland built up roof system……$245.00 PER ROLL for a 1 square SBS Modified membrane. In our market, Performance/Derbigum is considered the “high end” material at a price of $90.00. Manville and TAMKO are competitive at $65.00." 

Note that the price he was quoted is about 3-4 times normal cost for the initial installation of a good roof with a warranty that usually only requires hundreds, not many thousands of dollars, in repairs when they occur versus a five-year payment to "keep up the warranty". And that cost does not include when the roofs will be redone.... 

A manufacturer is now in jail for reporting Garland to local officials: http://schoolroofingscam.blogspot.com/2009/04/new-hampshire-officials-declare-war-on.html "New Hampshire Officials Declare War on a Manufacturer Standing up to the Scam"

Attempt to stop Garland sole-sourced in Albuquerque Public Schools by a Task Force: http://ww2.aps.edu/cgi/displaypress2.cgi?136 and in the Albuquerque Journal at: http://www.stopthewarmachine.org/events/jan18pdf.pdf (front page only) or go to www.abqjournal.com and search for the story - paid subscription or per piece, "APS Roofing Costs Sky High", January 19, 2003. It was also reported on KOBTV in Albuquerque in May, 2001. 

Garland was named in the New Jersey State Commission of Investigation Report of 1999/2000, "Waste and Abuse in School Roofing Projects" as one of three roofing manufacturing firms overcharging and more. See: http://schoolroofingscam.blogspot.com/2008/02/new-jersey-report-link.html 
"The New Jersey Report -- The Link" 

Garland is now heard to be "annualizing" Purchase Orders in the 6-figure range in California, where labor is done separately and the contracts are "broken out". The appropriate licensed persons did not review conditions, design or draw up the proper competitive and detailed bidding documents necessary to ensure the public health, safety and welfare. Ohio is having the same problem, we hear.

Update:  See www.thebakersdfieldboys.blogspot.com for Kern High School District purchase orders....

Garland Roofing Business Model

Here are the Garland Training Documents - that show clearly their "Business Model": See top of page 2: "The strongest sale will always be Garland materials and performance specficiations and no "or equals". 

 And then they state: "Public contracts can be very lucrative, but they require a very dedicated, sophisticated sale; one which anticipates the things that your competitors are going to do prior to the bid opening. If you are not willing to do all of these things, don't do business with schools." 

And then they describe some of what we know they do......

Top of page 3:

'I suggest you start your presentation by selling "fear." '

Towards the bottom of page 3:

"I suggest you emphasize that you are recommending a solution that is not proprietary."

Then he tells the Garland sales reps:

1. How to mix up the manufacturers listed - to look "competitive"; 

2. How to demand that the substitution won't hurt the "system" (although known for substituting J-M plies for their own under their top cap sheet - and not returning the difference...);

3. How to "lock-spec" - by using extreme test listings, not verifiable to a school district guy that it might or might not be accurate...see the next posting to come up in the next couple of days....

But he doesn't tell his sales reps they private label from their competitors - who produce products that the sales reps have been known to decry as not competitive with their own products, and get "disallowed" by school district personnel in so-called "bids."

Here's some of the "restrictive proprietary performance specs" guidelines being taught to Garland sales reps, to "lock-spec" their product in public and school work.

They state that "under no circumstances, are loosely-laid or single-ply systems acceptable."

And they state that 'if you have to go "or equal" "depending upon the intestinal fortitude of the guy you are selling"' to, either "aim for a chance at getting the job - or eliminating as much of the competition as possible."'

Then he describes how you can lock in the Garland product...with specific lock-spec language, on this last page: ______________________________________________

So, Garland - would you like to explain to the public:

1. The conflicts of interest of a manufacturer having their reps certify without any independent, owner-supplied reps that the roofs were installed correctly.

2. Why you would call a true Maintenance Agreement a "Warranty".

3. How many of those Maintenance Agreements actually got paid for on time and actually got extended, with his public works projects.

4. How many times they redid roofs on all your jobs - you know, the true life of the roofs? Was it 6, 7, 8, 9, 10, 11, or every 12 years?

5. Who private labels their products for you, and which ones? We all know there are only four major US roofing manufacturers. We believe that you have Carlisle private label some of your products, as does Johns Manville for Tremco.

6. When in a so-called "bid" situation when an equal is produced, how many times have you had disqualified products that are the same as yours, only yours are private-labeled?

7. When is the responsible San Francisco Bay Area Garland Rep going to give the Federal Government back all those overcharges for the Johns Manville plies used under their top cap sheet....and charged for as if they were Garland plies, about 3 times or more the price of the J-M plies? Let's see, why don't we start with the US Postal Distribution Service Center just south of the Cow Palace in San Francisco County....and how many schools shall we go pull cores on to find out what you did where?

8. How much did you pay architects to insert your specs into the project bid specs? $10,000 or more? Which architects, for which jobs?

9. How many architects and engineers specifying your products get your $50,000 indemnification for potential problems with the jobs? All of them? It certainly covers most of their deductibles on E&O Insurance Policies - giving them a financial incentive to specify you.

10. And are you aware how bogus it is to list "ASTM D5147" in the actual tests you list in your illegal, restrictive, proprietary specs?

It's a test method - not a test.

ASTM Roofing Committee Members informed me of this particular bogus spec practice - seen in San Francisco Unified School District Specs.
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[Editor's Note: Read Garland's training documents above, and Tremco's training documents, here: http://schoolroofingscam.blogspot.com/2008/02/tremco-in-house-training-documents.html which show both "Business Models" - "Sales Models" - are more concerned about locking out competition -to get their admitted, higher-priced products in to schools.]

Tremco's "business model"predates Garlands', for those who don't know. Tremco executives left to take over a flooring company (Garland) in the early 1970's, to compete with that same business model with Tremco.....

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