Antitrust Law Daily Wrap Up, ANTITRUST—D. Kan.: Dow entitled to limited discovery on new theories raised in out-opt actions in urethane price fixing case, (Jul 26, 2013)

By Jeffrey May, J.D.

Following a class-action trial against Dow Chemical Company for conspiring to fix prices for certain polyurethane chemical products that resulted in a $1.2 billion judgment against the firm, the federal district court in Kansas City, Kansas, has granted Dow's motion to conduct limited discovery relevant to newly asserted theories in revived actions brought by plaintiffs who had opted out of the class action (In re: Urethane Antitrust Litigation, July 25, 2013, O’Hara, J.).

The direct actions had been stayed during the class-action trial and events immediately preceding trial. They became active again following the class plaintiffs' victory. The parties agreed that the court would resolve this discovery issue among others before the cases were remanded to the court where they were originally filed before consolidation.

There was good cause to permit limited additional discovery because the direct-action plaintiffs (DAPs) indicated an intent to pursue two theories—a “document-destruction-cover-up theory” and a “failure-to-investigate-price-fixing-reports theory”—that were not active in the case during the original discovery period. Dow demonstrated a reasonable basis for not seeking discovery on these topics prior to the previously set deadline, the court explained.

In an effort to refute the DAPs’ assertion that Dow destroyed a terminated executive's notes as part of a “post-litigation cover-up,” Dow sought to depose an attorney who prepared a binder used by the terminated executive’s attorney at the executive's deposition. The executive had testified that the binder, which was shown to her prior to her deposition, did not include some of the executive's notes. These notes purportedly contained information on pricing conversations between Dow and a competitor.

The court granted Dow's request to depose the attorney “about the facts and circumstances surrounding the assembly of the binder and its contents.” Any additional discovery from the attorney was denied.

With respect to the second theory, Dow requested discovery on whether the terminated executive made antitrust allegations and complaints before her termination in 2004 and whether Dow acted on them. Although Dow did not specifically state the type or extent of discovery it sought on the topic, the court granted Dow's request for discovery, most likely depositions, on this limited topic.

The court ordered that the discovery was to be completed by September 30, 2013.

The case is MDL No. 1616, Case No. 04-MD-1616-JWL; Case No. 08-2617-JWL; Case No. 09-2026-JWL; Case No. 10-2077-JWL.

Attorneys: Gloria B. Solomon (Trout Cacheris, PLLC) for Carpenter Co. David C. Eddy (Nexsen Pruet, LLC) for Dash Multi-Corp, Inc. Edward H. Wasmuth, Jr. (Smith, Gambrell & Russell, LLP) for Woodbridge Foam Corp. Brian R. Markley (Stinson Morrison Hecker LLP) for Dow Chemical Co.

Companies: Dow Chemical Co.

Cases: Antitrust KansasNews