Antitrust Law Daily Wrap Up, ANTITRUST—S.D.N.Y.: Complaints dismissed in concrete and cement additives multidistrict antitrust litigation, (Jun 26, 2025)

By Kenneth H. Ryesky, M.B.A., J.D.

Lawsuits brought following investigations of industry by authorities in European Union, United Kingdom, and Turkey; Department of Justice, which had conducted its own investigation, also intervened in the multidistrict litigation.

A federal district court judge in New York City has dismissed the antitrust claims for all cases under multidistrict litigation against main players in the concrete, cement, and additives industry. The plaintiffs, lacking direct evidence of an illegal Sherman Act conspiracy, failed to allege the requisite parallel conduct for indirect evidence, and their Sherman Act claims thus failed. The court further found that even if parallel conduct had been plausibly pleaded, the plaintiffs' allegations did not plead any plus factors to buttress parallel conduct. The Sherman Act claims having failed, the court found it unnecessary to address the jurisdictional dismissal motion. The Indirect Purchaser Plaintiffs' state law claims, all anchored in the Sherman Act claims, were also dismissed. The dismissals of the Massachusetts, Michigan, and Utah state law claims were unopposed and therefore dismissed with prejudice; all other dismissals were without prejudice and with leave to replead (In Re: Concrete and Cement Additives Antitrust Litigation, No. 1:24-md-03097-LJL (S.D.N.Y. June 25, 2025)).

Background. The United States building construction activity is highly dependent upon (1) concrete admixtures; (2) cement additives; (3) admixtures for mortar; and (4) products containing or bundled with any of the foregoing additives or admixtures (collectively, CCAs). The American CCA industry production is worth more than $3 billion and growing. In October 2023, the European Commission (EC) announced that it had cooperated and coordinated with the United Kingdom's Competition & Markets Authority (CMA) and the Turkish Competition Authority (TCA) in conducting surprise inspections of the CCA industry; the EC's announcement disclosed that the US DoJ Antitrust Division had been consulted in the process. These inspections scrutinized six industry giants, each of which has subsidiaries and/or affiliates in the United States.

Following the EC's announcement and confirmatory pronouncements by the CMA and the TCA, several class action antitrust lawsuits were filed by construction industry users of CCAs against the six industry groups and their U.S. affiliates. Eighteen of those lawsuits were consolidated for multidistrict litigation in the Southern District of New York. The DoJ Antitrust Division, which had conducted its own investigation of the U.S. CCA industry, intervened in the multidistrict litigation.

Four motions to dismiss were filed by the defendants, each based upon different failure to state a relief claim theories [Fed. R. Civ. P. 12(b)(6)]: (1) No direct evidence or parallel conduct was stated to infer a Sherman Act conspiracy, insufficient allegations of "plus factors" upon which a conspiracy can be inferred, and no facts alleged to connect each Defendant to the conspiracy; (2) the Indirect Purchaser class action Plaintiffs did not plausibly plead their state law claims; (3) no allegation that the private equity firm defendant was liable for the actions of the CCA firm in which it had invested; and (4) insufficient allegations that the foreign parent company defendants were involved in the activities of their U.S. subsidiaries or affiliates. An additional motion to dismiss was filed on failure to plead personal jurisdiction [Fed. R. Civ. P. 12(b)(2)].

Sherman Act-parallel conduct. The court found that the plaintiffs' complaints all failed to plausibly allege parallel conduct. Here, the plaintiffs had acknowledged that their pleadings had no direct evidence of a Sherman Act conspiracy [15 U.S.C. § 1], but rested upon indirect evidence of price increases by the defendants. The price increases recited in the plaintiffs' complaints were not closely-timed to one another, applied to different geographical areas, pertained to different CCA products, and had wide variances in size and amounts. Those price increases "were not sufficiently similar to give rise to an inference of parallel conduct" and "were episodic and inconsistent with coordinated activity." The plaintiffs' allegations belied no overarching connecting pattern in the price increases listed in the complaint.

The so-called "follow the leader" pattern effectively alleged by the plaintiffs is not illegal in and of itself, and can be explained by a prudent "wait and see" attitude by the followers in judging the market risks.

Additionally, the class period of eight years was susceptible to price inflation, even in a competitive market. "The mere fact that each Defendant increased prices over the eight-year duration of the Class Period thus does not suggest they did so in combination." The dummy variable multiple regression analysis proffered by the Direct Purchaser Plaintiffs was inconclusive, lacked supporting information, and was insufficient to show that the defendants' price increases exceeded any normal market forces.

Sherman Act-plus factors. The judge ruled that even if the plaintiffs had plausibly pleaded parallel conduct, there was no plausible pleading of any "plus factors" necessary for indirect evidence of a Sherman Act conspiracy.

Allegations that the defendants could have conspired through common membership in industry trade associations were insufficient to support an inference that the defendants did conspire at trade association meetings. Similarly, the fact that the industry had many mergers and consolidations that led to a higher concentration which could have provided fertile ground for a conspiracy fell short of alleging that the defendants did conspire. Nor was the mere existence of a profit motive a sufficient allegation of a motive to illegally conspire in violation of the Sherman Act.

The mere fact that the DoJ had conducted an investigation of the industry, without any findings of actual violations alleged, is not a plus factor. It is only natural that the DoJ Antitrust Division would undertake some sort of investigation after being consulted by analogous foreign governmental authorities, and those foreign governmental bodies are limited in their discovery of anticompetitive (and other illegal) activities occurring in the United States by the relevant treaties.

The Case is No. 1:24-md-03097-LJL.

Judge: Liman, L.

Attorneys: Robert N. Kaplan (Kaplan Fox & Kilsheimer LLP) for SMBA Construction, LLC. Jeannine M. Kenney (Hausfeld LLP) for Keystone Concrete Block & Supply Co. Inc. Matthew Bratvold Bolt (Larson King, LLP) for Park Construction Co. David Frazier (Latham & Watkins LLP) for Chryso, Inc. Anna E. Sanders (Buchanan Ingersoll & Rooney PC) for Cinven Ltd. Marguerite M. Sullivan (Latham & Watkins LLP) for Saint-Gobain North America.

Companies: SMBA Construction, LLC; Keystone Concrete Block & Supply Co. Inc.; Park Construction Co.; Chryso, Inc.; Cinven Ltd.; Saint-Gobain North America

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