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From Antitrust Law Daily, July 10, 2018

Settlements with Furukawa and Mitsubishi Electric defendants proposed in auto parts price fixing case

By Edward L. Puzzo, J.D.

At this juncture in a long-running consolidated antitrust class action alleging that vehicle parts manufacturers conspired to fix prices for parts, Direct Purchasers of wire harness products in the United States have moved the federal district court in Detroit for preliminary approval of proposed settlements with the Furukawa defendants (Furukawa Electric Co., Ltd. and American Furukawa, Inc.) and the Mitsubishi Electric defendants (Mitsubishi Electric Corporation, Mitsubishi Electric US Holdings, Inc., and Mitsubishi Electric Automotive America, Inc.). They further request that the Furukawa and Mitsubishi Electric settlement classes be provisionally certified and the dissemination of notice to these settlement classes be authorized (In Re: Automotive Parts Antitrust Litigation, July 9, 2018, Battani, M.).

Under the proposed settlements, the Furukawa defendants would be required to pay $19 million and the Mitsubishi Electric defendants would be required to pay over $680,000. Since 2011, the same plaintiffs have previously obtained court approval of settlements totaling over $102 million against various other defendant groups.

In support of their motion for preliminary approval, Direct Purchaser Plaintiffs state that the settlements were reached after extended arm's-length good-faith negotiations with experienced counsel following substantial discovery. The motion states that the proposed settlements are fair and within the range of possible final approval, that the Furukawa and Mitsubishi Electric defendants have provided meaningful cooperation which is especially useful when the settlement is with less than all defendants.

Settlement evaluation. In the Sixth Circuit, seven factors are used to determine whether a settlement is fair, reasonable and adequate. As to the first factor—the likelihood of success on the merits weighed against the amount and form of the relief offered in the settlement—the plaintiffs argue that given the defenses available and the uncertainties of litigation, the proposed settlements are an excellent result. As to the second factor—the complexity, expense, and likely duration of further litigation —the plaintiffs argue that the proposed settlements eliminate the risks, expense and delay with regard to the settling defendants and ensure substantial payments to the settlement class. As to the third factor—the opinions of class counsel and class representatives—the plaintiffs argue that the opinion of the experienced counsel, that the proposed settlements warrant approval, is entitled to significant weight. As to the fourth factor—the amount of discovery engaged in by the parties—the plaintiffs argue that fact discovery is largely complete, that they have reviewed more than a million pages of documents and taken 50 depositions. As to the fifth factor—the reaction of absent class members—the plaintiffs stated they did not have enough information to assess this factor but noted a scarcity of objections thus far. As to the sixth factor—the risk of fraud or collusion—the plaintiffs argue that the negotiations were at arm's length with no collusion. Finally, as to the seventh factor—the public interest—the plaintiffs argue that settlement of this complex class action suit would conserve judicial resources.

Certification of class. The motion notes that the court has already certified eight prior settlement classes of direct purchasers of wire harness products in this case and argues it should do the same here. The motion argues that numerosity is shown by the thousands of direct purchasers of wire harness products in the United States; commonality is shown by common questions of law and fact in the alleged price-fixing conspiracy; typicality is shown by the various plaintiffs' claims arising from the same course of conduct; the class representatives can fairly and adequately represent the interests of the class; and predominance is shown because common questions of law and fact predominate over questions affecting only individual members.

The case is No. 2:12-cv-00101-MOB-MKM.

Attorneys: Darryl Bressack (Fink + Associates Law) and Gregory P. Hansel (Preti Flaherty Beliveau & Pachios, LLP) for Martinez Manufacturing, Inc., Mexican Industries In Michigan, Inc. and T.M. Morris Manufacturing Co., Inc. Craig D. Bachman (Lane Powell PC) and David H. Suggs (White & Case LLP) for Furukawa Electric Co., Ltd. and American Furukawa, Inc. Andrew Marovitz (Mayer Brown LLP) and Dante A. Stella (Dykema Gossett PLLC) for Lear Corp.

Companies: Martinez Manufacturing, Inc.; Mexican Industries In Michigan, Inc.; T.M. Morris Manufacturing Co., Inc.; Furukawa Electric Co., Ltd.; American Furukawa, Inc.; Lear Corp.

MainStory: TopStory Antitrust MichiganNews

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