Antitrust Law Daily Wrap Up, TOP STORY—S.D. N.Y: $244M settlement in suit alleging monopolization of in-store promotions gets preliminary approval, (Jun 3, 2016)
Law Firms Mentioned:Berry Law PLLC | Kellogg, Huber, Hansen, Todd, Evans & Figel, PLLC | Kramer Levin Naftalis & Frankel LLP | McKool Smith PC | Susman Godfrey LLP
Organizations Mentioned:Berry Law, PLLC | Dial Corp. | Foster Poultry Farms | H. J. Heinz Co. LP | H.J. Heinz Co. | Kellogg Huber Hansen Todd Evans & Figel, PLLC | Kramer Levin Naftalis & Frankel, LLP | McKool Smith, PC | News America Inc. | News America Marketing FSI LLC | News America Marketing Fsi, LLC | News America, Inc. | News Corp. | Smithfield Foods, Inc. | Susman Godfrey, LLP
By Linda O’Brien, J.D., LL.M.
Preliminary approval of the $244 million settlement of a class action suit by consumer product firms—charging News Corporation with monopolizing the market for third-party, in-store promotions—has been granted by the federal district court in New York City (The Dial Corporation v. News Corporation, June 2, 2016, Pauley, W.).
Consumer packaged goods (CPG) firms Dial Corp., H.J. Heinz Co., Foster Poultry Farms, and Smithfield Foods, Inc. purchase a wide variety of in-store promotions (ISPs), including print and electronic signage, end of aisle displays, shelf-mounted displays, freezer displays, and floor signage. News Corp. is a mass media company that serves as a middleman in the ISP market between CPGs and mass retailers.
The CPGs brought antitrust claims under the Sherman Act, the Clayton Act, the New York Donnelly Act, and the Michigan Antitrust Reform Act, alleging that News Corp. maintains a monopoly in the market for ISPs by entering into long-term contracts with retailers for exclusive access to their stores. The CPG plaintiffs moved for preliminary approval of their settlement with News Corp.
Settlement terms. According to the plaintiffs’ motion for preliminary approval of the settlement, News Corp. agreed to make a $244 million cash payment for the benefit of the class members. News Corp. also has agreed, for a period of five years, to: (1) not enter into any exclusive retailer contract for ISPs with a term of longer than 30 months; (2) not renew any retailer contract more than 18 months before the expiration of an existing retailer contract; and (3) not preclude retailers from disclosing the termination dates of their contracts to a bona fide competitor or prospective competitor of News Corp.
The court directed News Corp. to pay the settlement funds into an interest-bearing account in the government’s Court Registry Investment System no later than July 5.
Approval of settlement agreement. The court preliminarily found that the settlement was fair, reasonable, and adequate. A hearing for final approval of the proposed settlement is set for September 21, at which time the court will consider the proposed plan of allocation and the plaintiffs’ counsel application for an award of attorney fees and costs.
The case is No. 1:13-cv-06802-WHP.
Attorneys: James T. Southwick (Susman Godfrey LLP), Steven F. Benz (Kellogg, Huber, Hansen, Todd, Evans & Figel, PLLC), Daniel B. Goldman (Kramer Levin Naftalis & Frankel LLP), R. Stephen Berry (Berry Law PLLC), Lewis T. LeClair and John C. Briody (McKool Smith PC) for The Dial Corporation.
Companies: Dial Corp.; H. J. Heinz Co. LP; Foster Poultry Farms; News Corp.; News America Inc.; News America Marketing FSI LLC
MainStory: TopStory Antitrust NewYorkNews