WASHINGTON - The Federal Trade Commission said Mahle, a German piston manufacturer, and Metal Leve of Brazil have agreed to pay a record $5.6 million civil penalty for alleged violation of U.S. antitrust law.
The FTC charged the companies failed to notify federal officials when Mahle (pronounced MAH-luh) bought a controlling interest in Metal Leve (pronounced LEH-veh) last year.
Because both companies have operations in the United States, and they are competitors, they were required by law to seek U.S. government approval for the acquisition.
The complaint alleged that the companies knew they were required to file for government approval, but chose not to.
The commission said the civil penalty is the maximum allowed by law, and is the largest ever in such a case. The settlement is subject to federal court approval.
The commission charged that the acquisition substantially reduced competition in the market for certain types of pistons used in diesel engines.
Under a previous agreement with regulators, Metal Leve's U.S. piston business in Ann Arbor, Mich., has been sold.
Mahle's American operations are in Morristown, Tenn.