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From Antitrust Law Daily, December 17, 2013

Suits alleging conspiracy to restrict aluminum supply centralized for pretrial proceedings

By Jeffrey May, J.D.

The Judicial Panel on Multidistrict Litigation (JPML) has consolidated in the federal district court in New York City a number of actions against Goldman Sachs Group, Inc., JP Morgan Chase & Co., and others for allegedly conspiring with the London Metal Exchange, Ltd. (LME) to artificially restrict the supply of aluminum to drive up prices (In re Aluminum Warehousing Antitrust Litigation, December 16, 2013, Heyburn, J.).

Centralization in the federal district court in New York City would serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation, the JPML concluded. The case was assigned to the Honorable Katherine B. Forrest.

At the time the motion for centralization pursuant to 28 U.S.C. § 1407 was filed, the litigation consisted of three actions, which were filed in federal district courts in DetroitNew Orleans, and Tallahassee. Since the filing of the motion, related actions have been filed in various districts. The suits seek to recover for alleged overcharges and other relief.

The parties to the disputes agreed that centralization was appropriate; however, they disagreed on the proper choice for a transferee district. Defendants LME, Goldman Sachs, and JP Morgan supported centralization in either the Southern District of New York or the Eastern District of Michigan. The plaintiffs in three Southern District of New York potential tag-along actions also supported centralization in the Southern District of New York.

All of the actions shared factual questions arising from allegations that defendants monopolized domestic aluminum supplies, conspired to restrain aluminum supplies, and fixed the prices of aluminum premiums. Centralization would eliminate duplicative discovery; prevent inconsistent pretrial rulings (especially with respect to class certification); and conserve the resources of the parties, their counsel, and the judiciary, the JPML decided.

According to the plaintiffs, the amount of aluminum stored in LME-certified warehouses has “soared” in recent years. It was noted that the plaintiffs had focused on conduct involving a series of warehouses owned by Goldman Sachs subsidiary Metro International Trade Services in the Detroit area, where the alleged backlog of aluminum had occurred.

Despite the litigation’s connection with Michigan, the Southern District of New York was selected as the transferee forum. Defendants J.P. Morgan and Goldman Sachs were headquartered there. Numerous decisions regarding alleged anticompetitive conduct in the market for aluminum likely were made in the district. Moreover, the district was a relatively convenient forum for LME—a central figure in the alleged conspiracy—according to the JPML.

This case is MDL No. 2481.

Attorneys: Phillip Timothy Howard (Howard & Associates PA) for Master Screens Inc. Jerome Wayne Hoffman (Holland & Knight LLP), Gregory L. Curtner (Schiff Hardin LLP), and Mark Aaron Cunningham (Jones Walker) for Goldman Sachs Group Inc. and Metro International Trade Services. George N. Meros, Jr. (Grayrobinson PA) for JP Morgan Chase & Co. Daniel E. Becnel , Jr. (Becnel Law Firm, LLC) for River Parish Contractors, Inc. Harold Z. Gurewitz (Gurewitz & Raben, PLC) for Superior Extrusion, Inc. William H. Horton (Giarmarco, Mullins & Horton, PC) for London Metal Exchange Ltd.

Companies: Master Screens Inc.; Goldman Sachs Group Inc.; Metro International Trade Services; JP Morgan Chase & Co.; River Parish Contractors, Inc.; Superior Extrusion, Inc.; London Metal Exchange Ltd.

MainStory: TopStory Antitrust

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