Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Preliminary approval sought for $37M settlement in optical disk drive price fixing suit, (Nov 4, 2015)

By Linda O’Brien, J.D., LL.M.

In multidistrict litigation by direct purchasers against several electronics manufacturers for an alleged conspiracy to rig bids and fix prices of optical disk drives, the plaintiffs are seeking preliminary approval of a $37 million settlement with seven defendant corporations, including BenQ Corp., Pioneer Electronics, Sony, and Samsung, according to a motion for preliminary approval of class action settlements filed in the federal district court in San Francisco (In re Optical Disk Drive Antitrust Litigation, November 3, 2015).

Direct purchasers of electronic products filed class action complaints against Hitachi, LG, Panasonic, NEC Corporation and other electronic product manufacturers, alleging that the manufacturers engaged in a conspiracy to rig bids and fix prices for optical disk drives (ODDs) that are included in various electronic devices. The plaintiffs alleged that the price fixing conspiracy began in January 2004 and continued until January 2010, and was carried out through agreements to fix prices and restrict output by bid rigging, market allocation, and use of trade associations.

The court previously approved settlements of $26 million with Hitachi and LG Electronics, $5.75 million with Panasonic, and $6 million with NEC Corporation. Before the court was the plaintiffs’ motion, seeking preliminary approval of settlements with defendants BenQ Corp., Pioneer Electronics, Koninklijke Philips Electronics, Quanta Storage, Sony, TEAC Corp., and Samsung.

According to the plaintiffs’ motion, the defendants will pay a combined total of $37 million into separate escrow accounts for the benefit of class members. The settlements also require the defendants to cooperate in the prosecution of the case against non-settling defendant by producing trial witnesses and additional discovery.

The proposed settlements are within the range of reasonableness, the plaintiffs argued. They were the product of arm’s length negotiations conducted by experienced and well-informed counsel. The negotiations were informed by expert analysis and extensive discovery, according to the motion. The settlements confer a substantial benefit to the class since class members will receive meaningful cash payments in the short term and avoid the risk of continued litigation.

The motion states that the class definition contemplated by each settlement is identical to settlement classes already certified by the court and includes all individuals and entities that, during the period from January 1, 2004 until at least January 1, 2010, purchased one or more optical disk drives in the United States directly from the defendants.

Plaintiffs claimed that the requirements of Federal Rule of Civil Procedure 23(a) are satisfied in the case. The class is so numerous that joinder of all members is impracticable. The case involves questions of law and fact common to the class. The claims of the class representatives are typical of the claims of the class. Furthermore, the class representatives will fairly and adequately protect the interests of the class, the plaintiffs contended.

The proposed class also satisfies the requirements of Rule 23(b)(3), the motion maintains. Common questions of law and fact predominate over individual questions, and a class action is superior to other available methods for the fair and efficient adjudication of the case.

Finally, the motion requests appointment of settlement class counsel, approval of the proposed plan of notice and allocation, and the setting of a final approval hearing schedule.

Attorneys: Guido Saveri (Saveri & Saveri, Inc.), Joseph W. Cotchett (Cotchett, Pitre & McCarthy), Michael P. Lehmann (Hausfeld LLP), Robert Kaplan (Kaplan Fox & Kilsheimer, LLP), Eric B. Fastiff (Lieff Cabraser Heimann & Bernstein, LLP), Bruce L. Simon (Pearson Simon Warshaw LLP), Joseph J. Tabacco, Jr. (Berman DeValerio), and Joseph M. Alioto (Alioto Law Firm) for the plaintiffs.

Companies: BenQ Corp; Pioneer Electronics Inc.; Koninklijke Philips Electronics N.V.; Quanta Storage Inc.; Sony Corp.; TEAC Corp.; Samsung Electronics Co., Ltd.

News: Antitrust CaliforniaNews