Antitrust Law Daily Wrap Up, ANTITRUST—E.D.N.Y.: $197M settlement approved in freight forwarding price fixing action, (Nov 12, 2015)

By Greg Hammond, J.D.

Eleven settlement agreements, totaling more than $197.6 million, have received final approval by the federal district court in Brooklyn, New York, resolving claims that numerous freight forwarding companies engaged in a price fixing conspiracy in the international commercial freight forwarding industry (Precision Associates, Inc. v. Panalpina World Transport Holding Ltd., November 10, 2015, Gleeson, J.).

The court previously approved settlements with 10 other groups of defendant freight forwarders, totaling $112 million. The settlement fund is expected to grow further as settling defendants receive payments from the related multi district litigation In re Air Cargo Shipping Services Antitrust Litigation, Case No. 06-md-1775 (JG) (VVP), in which freight forwarders claim that various domestic and foreign airlines conspired to develop and implement an industry-wide index for calculating fuel and security surcharges at supra-competitive rates that were applied to thousands of routes worldwide.

Fairness. The court first determined that the 11 settlement agreements are procedurally fair and entered into in good faith after extensive arm’s length negotiations. Specifically, the court noted that nine of the settlements were aided by a nationally recognized mediator; class counsel zealously represented the interests of the class during settlement negotiations; and, due to the extensive discovery that has occurred in this case, class counsel were well informed as to the facts of the case and strengths of the claim asserted. There was also no evidence of collusive behavior in reaching the settlement agreements.

The Court also concluded that the settlements are substantively fair, because the settlement amounts are within the range of reasonableness; the proceeds are expected to grow as defendants receive payments from the In re Air Cargo multi district litigation; and the settlements could facilitate a more expeditious outcome of the remaining claims and could advance final resolution of the litigation.

Attorney fees. Counsel for plaintiffs were also awarded over $42 million in attorney fees, representing 25 percent of the total available settlement fund, and $4 million in expenses. The court found the request for attorney fees fair and reasonable, given the length of the litigation—eight years—and the number of hours class counsel have spent prosecuting the litigation—153,782.18 hours. In addition, the court noted that class counsel are highly experienced, the settlements were the result of hard fought arm’s-length negotiations, and the settlement amounts proposed attest to class counsels’ ability.

The case is No. 1:08-cv-00042-JG-VVP.

Attorneys: Christopher Lovell (Lovell Stewart Halebian Jacobson LLP), Steven N. Williams (Cotchett, Pitre & McCarthy LLP), W. Joseph Bruckner (Lockridge Grindal Nauen P.L.L.P.), and Daniel E. Gustafson (Gustafson Gluek PLLC) for plaintiffs. Darrell Prescott (Baker & McKenzie LLP) and Douglas Michael Tween (Linklaters LLP) for Panalpina World Transport Holding Ltd. and Panalpina, Inc. Eileen Steven J. Kaiser (Cleary Gottlieb Steen & Hamilton LLP) for Deutsche Post AG.

Companies: Panalpina World Transport Holding Ltd.; Panalpina, Inc.; SDV Logistique Internationale; Geodis S.A.; DSV A/S; Jet Speed Logistics, Ltd.; Toll Global Forwarding USA, Inc.; Agility Holdings, Inc.; United Parcel Service, Inc.; Dachser GmbH & Co.; Hankyu Hanshin Express Holding Corp.; Deutsche Post AG

Cases: Antitrust NewYorkNews