Antitrust Law Daily Wrap Up, ANTITRUST—E.D. Mich.: Court chills amended prepackaged ice antitrust settlement agreement, (Aug 11, 2016)

By Michael Menzhuber, J.D., LL.M.

The amendment of a settlement agreement entered into by an ice producer, in an antitrust case involving prepackaged ice, that would have effectively combined it with a settlement agreement entered into by another ice producer, was not approved by the federal district court in Detroit. The court determined that the benefits of combining the settlement funds were outweighed by the complications and inequities that would be created (In re Packaged Ice Antitrust Litigation, August 9, 2016, Borman, P.).

After entering into separate settlement agreements with Home City Ice Co., Arctic Glacier Int’l, and Reddy Ice, in a consolidated class action that had alleged federal and state antitrust claims, the plaintiffs and Home City entered into an amended settlement agreement. The amended settlement agreement provided, in part, for a newly-defined Home City settlement class that closely mirrored the settlement class in the Reddy Ice Texas bankruptcy proceedings.

The Reddy Ice settlement agreement included all indirect purchasers of packaged ice, while the original Home City settlement agreement provided for two distinct settlement classes, including a class of all indirect purchasers of packaged ice in the United States and a class of indirect purchasers from 28 states that were entitled to monetary relief. By amending the Home City settlement class to closely mirror the Reddy Ice settlement class, the parties sought a combination of the Reddy Ice settlement fund, which consisted of approximately $300,000 after attorney fees and costs, and the Home City settlement fund, which was approximately $2.7 million.

The court found that combining the two settlement funds to preserve as much of the dwindling Reddy Ice settlement fund as possible, by coordinating the claims process with the process for distribution of the Home City settlement, was a laudable goal. However, the court concluded that the benefits of combining the settlement funds were dwarfed by the greater complications and potential inequities it created.

The case is No. 08-md-1952.

Attorneys: Joseph Marid Patane (Law Offices of Joseph M. Patane) and Lauren Clare Russell (Trump, Allioto) for Marin Scotty's Market, Inc. David L. DeBord (Jones Day) and Howard B. Iwrey (Dykema Gossett PLLC) for Arctic Glacier, Inc.

Companies: Marin Scotty's Market, Inc.; Arctic Glacier, Inc.

Cases: Antitrust MichiganNews