United States District Court, E.D. Michigan
IN RE AUTOMOTIVE PARTS ANTITRUST LITIGATION In Re: Heater Control Panels In Re: Occupant Safety Systems In Re: Switches In Re Ignition Coils In Re: Steering Angle Sensors In Re: Electric Powered Steering Assemblies In Re: Fuel Injection Systems In Re: Valve Timing Control Devices In Re: Air Conditioning Systems In Re: Automotive Constant Velocity Joint Boot Products In Re: Automotive Hoses In Re Shock Absorbers In Re: Body Sealing Products In Re: Interior Trim Products In Re: Automotive Brake Hoses In Re: Exhaust Systems In Re: Ceramic Substrates In Re: Power Window Switches In Re: Automotive Steel Tubes In Re: Side-Door Latches THIS DOCUMENT RELATES TO End-Payor Actions
ORDER GRANTING END-PAYOR PLAINTIFFS' UNOPPOSED
MOTION FOR AN ORDER APPROVING THE PROPOSED FURTHER REVISED
PLAN OF ALLOCATION AND FOR AUTHORIZATION TO DISSEMINATE
SUPPLEMENTAL NOTICE TO THE SETTLEMENT CLASSES
D. BORMAN MARIANNE O. BATTANI UNITED STATES DISTRICT JUDGE
above matter is duly before the Court on the unopposed motion
of End-Payor Plaintiffs (“EPPs”) for approval of
the proposed revised Plan of Allocation and for authorization
to disseminate supplemental notice to the Settlement Classes.
Court has reviewed the memorandum submitted by EPPs in
support of their motion and has also reviewed the various
declarations and submissions relating to that motion. The
Court has also considered the July 2019 Notice Program and
notice given to the Settlement Classes in accordance with the
Court's orders, and the proposed Supplemental Notice.
on the entire record of these proceedings, and good cause
appearing therefor, IT IS HEREBY ORDERED as
notice provided to the Settlement Classes advised the
Settlement Classes of the motion and of the date, time, and
place of the hearing to consider the motion for approval of
the Plan of Allocation. The notice further advised that any
objections to the Plan of Allocation were required to be
received by the Court and the Claims Administrator by
November 19, 2019. Given that there are no pending objections
to the Plan of Allocation and that the proposed Plan of
Allocation, as revised, is fair, reasonable and adequate, the
Court hereby approves the revised Plan of Allocation and
gives EPPs authorization to disseminate supplemental notice
to the settlement classes for the reasons stated below.
Pursuant to and in compliance with Rule 23 of the Federal
Rule of Civil Procedure, and the requirements of
constitutional due process, the Court finds that due and
adequate notice was directed to the Settlement Classes of the
proposed Plan of Allocation and of the right of Settlement
Class members to be heard or object thereto, and a full and
fair opportunity was accorded to Settlement Class members to
be heard with respect to the Plan of Allocation.
Under Rule 23, “[a]pproval of a plan of allocation of a
settlement fund in a class action is governed by the same
standards of review applicable to approval of the settlement
as a whole; the distribution plan must be fair, reasonable
and adequate.” In re Packaged Ice Antitrust
Litig., No. 08-MD-01952, 2011 WL 6209188, at *15-16
(E.D. Mich. Dec. 13, 2011) (quoting Meijer, Inc. v.
3M, Civ. No. 04-5871, 2006 WL 2382718, at*17 (E.D. Pa.
2006)); In re Ikon Office Solutions Sec. Litig., 194
F.R.D. 166, 184 (E.D. Pa. 2000)). The purpose of a plan of
allocation is to create a method that will permit the
equitable distribution of settlement proceeds to all eligible
members of the class.
Accordingly, as courts have observed, “[a] district
court's ‘principal obligation' in approving a
plan of allocation ‘is simply to ensure that the fund
distribution is fair and reasonable as to all participants in
the fund.'” Sullivan v. DB Investments,
Inc., 667 F.3d 273, 326 (3d Cir. 2011) (quoting
Walsh v. Great Atl. & Pac. Tea Co., Inc., 726
F.2d 956, 964 (3d Cir. 1983)).
“Typically, a class recovery in antitrust or securities
suits will divide the common fund on a pro rata
basis among all who timely file eligible claims, thus leaving
no unclaimed funds.” In re Packaged Ice Antitrust
Litig., at *12 (quoting 3 Newberg on Class Actions,
§ 8:45 (4th ed. 2011)); see also In re Cardizem CD
Antitrust Litig., 218 F.R.D. 508, 531 (E.D. Mich. 2003)
(approving a plan of allocation that adopted a pro
rata method for calculating each class member's
share of the settlement fund as fair and reasonable). As a
result, courts in this district have previously held that
using a pro rata formula for calculating each class
member's share of a settlement fund is fair and
Courts have also determined that a Plan of Allocation
providing for a minimum payment, to incentivize claims
distribution and avoid de minimis settlement
payments, can be fair and reasonable. See, e.g.,
Downes v. Wis. Energy Corp. Ret. Account Plan, No.
09-C-0637, 2012 WL 1410023, at *3 (E.D. Wis. Apr. 20, 2012)
($250 minimum); In re Initial Pub. Offering Sec.
Litig., 671 F.Supp.2d 467, 498 (S.D.N.Y. 2009) ($10
minimum); In re Ins. Brokerage Antitrust Litig., 297
F.R.D. 136, 143 (D.N.J. 2013) ($10 minimum); Mehling v.
N.Y. Life Ins. Co., 248 F.R.D. 455, 463-64 (E.D. Pa.
2008) ($50 minimum); Slipchenko v. Brunel Energy,
Inc., No. CIV.A. H-11-1465, 2015 WL 338358, at *21 (S.D.
Tex. Jan. 23, 2015) ($100 minimum).
Here, EPPs propose allocating the net settlement funds on a
modified pro rata basis, subject to the adjusted
weighting of certain purchases or leases, based on the
purchases or leases of new vehicles not for resale which
contain automotive parts manufactured or sold by a defendant
and purchases of replacement automotive parts which contain
parts manufactured or sold by a defendant. Under the Plan of
Allocation, certain purchases or leases would be weighted
more heavily based on the evaluation by EPP's Co-Lead
Counsel of the vehicles that were specifically targeted by
the collusive conduct of defendants. Such weightings are
appropriate in class action cases. See, e.g., In re
Airline Ticket Comm'n Antitrust Litig., 953 F.Supp.
280, 285 (D. Minn. 1997). This pro rata allocation
would be modified by initially distributing $100 to all
eligible class members and then distributing the remaining
funds to all class members whose weighted pro rata
allocation exceeds $100 (subject to their being sufficient
funds for each class member claimant to receive at least
$100). If the net settlement funds are insufficient to allow
a minimum payment of $100 to each eligible class member
claimant, the amount to be paid to all claimants shall be
adjusted so that claimants share in the net settlement funds
on a pro rata basis based on the amounts of their
respective net allowed claim amounts.
Additionally, the Court determines that inclusion of the
place of purchase or lease as an alternative criterion of
eligible transactions is consistent with the law followed in
some jurisdictions that would allow a claimant, at his or her
option, to invoke state antitrust laws favorable to the
claimant based on the laws of the state in which the injury
was sustained. See In re Relafen Antitrust Litig.,
221 F.R.D. 260, 276-77 (D. Mass. 2004). Courts overseeing
antitrust actions have applied choice of law principles to
conclude that the place of injury is the place of purchase,
which may or may not be the purchaser's home state.
See, e.g., In re Flonase Antitrust
Litig., 815 F.Supp.2d 867 (E.D. Pa. 2011) (holding that
the law of the “purchase state” should be
applied); In re Wellbutrin XL Antitrust. Litig., No.
08-2433, 2011 WL 3563835, at *6-7 (E.D. Pa. Aug. 15, 2011)
(“The statutory language of the laws at issue here
contain no prohibitions that would indicate that a state has
a policy of only covering transactions that involve in-state
citizens, rather than in-state transactions.”);
Sheet Metal Workers Local 441 Health & Welfare Plan
v. GlaxoSmithKline, PLC, 737 F.Supp.2d 380, 390-93 (E.D.
Pa. 2010); In re Suboxone (Buprenorphine Hydrochloride
and Naloxone) Antitrust Litig., 64 F.Supp.3d 665 (E.D.
Pa. Dec. 3, 2014) (purchaser could sue under either the law
of the home state or of the purchase state). This is
consistent with the general rule that choice of law
principles take into account the facts and circumstances of a
particular case. Under those principles, a resident of a
state that does not provide a damages remedy to indirect
purchasers who made purchases in a “non-repealer”
or “non-damages” state may properly invoke the
more favorable antitrust laws of the state where the
defendant resides or engaged in conduct that violated the
laws of the state where the conduct took place. In
appropriate circumstances, based on applicable choice-of-law
rules, the laws of a single “repealer” state may
also be applied on a nationwide basis to all purchasers,
regardless of where they reside or where they made their
purchases. These cases, however, involve multiple
conspiracies with domestic and foreign defendants who
participated in price-fixing and bid-rigging conduct in
various countries around the world.
is well-settled that “a Plan of Allocation need not be,
and cannot be, perfect.” In re Cendant Corp. Sec.
Litig., 109 F.Supp.2d 235, 272 (D.N.J. 2000), aff'd,
264 F.3d 201 (3d Cir. 2001), cert. denied, 535 U.S.
929 (2002); see also Meredith Corp. v. SESAC, LLC,
87 F.Supp.3d 650, 667 (S.D.N.Y. 2015) (“As many courts
have held, a plan of allocation need not be perfect. Instead,
“[a]n allocation formula need only have a reasonable,
rational basis, particularly if recommended by experienced
and competent class counsel.” (internal quotations
omitted)). Although the satisfaction of everyone is generally
unobtainable, In re Warfarin Sodium Antitrust
Litigation, 212 F.R.D. 231, 258 (E.D. Del. 2002),
aff'd, 391 F.3d 516, 534 (3d Cir. 2004), a plan of
allocation should strive to obtain a delicate balance between
precision and administrative convenience, see, e.g.,
Sullivan v. DB Investments, Inc., 667 F.3d 273, 326
(3d Cir. 2011).
Here, EPPs propose to revise the Plan of Allocation to allow
Settlement Class members who purchased or leased a new
qualifying vehicle or purchased a replacement automotive part
in a damages state to be entitled to share in the Net
Settlement Funds. The Court finds that this is appropriate
and consistent with the above-referenced case law. Pursuant
to the Plans of Allocation approved in connection with the
Rounds 1, 2, and 3 settlements and the preliminarily approved
Plan of Allocation submitted in connection with the motion
for approval of the Round 4 settlements, individuals would be
entitled to share in the Net Settlement Funds only if they
resided in, and businesses would be entitled to share in the
Net Settlement Funds only if their principal place of
business was located in, a damages state at the time of such
purchase or lease. Under the further revised Plan of
Allocation, Settlement Class ...