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In Re Sulfuric Acid Antitrust Litigation

December 12, 2011

IN RE SULFURIC ACID ANTITRUST LITIGATION


The opinion of the court was delivered by: James F. Holderman, Chief Judge:

This Document Relates to:

ALL RELATED ACTIONS

MEMORANDUM OPINION AND ORDER

On March 21, 2007, District Judge David H. Coar, who was then presiding in this case, granted Plaintiffs' motion for class certification in this multi-district antitrust litigation. More than four years later, on June 7, 2011, after Judge Coar's December 31, 2010 retirement and the May 18, 2011 reassignment of this case, defendants Noranda, Inc., Falconbridge Limited, and NorFalco LLC (collectively "Noranda") and defendants Intertrade Holdings Inc., Pressure Vessel Services, Inc., Koch Sulfur Products Company, and Koch Sulfur Products Company, LLC (collectively "Koch") filed "Defendants' Motion to Decertify" (Dkt. No. 641), now pending before this court.

Noranda and Koch (together "Defendants") argue that decertification is warranted in light of "significant developments in Rule 23 jurisprudence," changes in the expert testimony relied on by Plaintiffs, and additional discovery undertaken since the entry of Judge Coar's March 2007 class certification order. For the reasons set forth below, Defendants' motion (Dkt. No. 641) is denied.

The class certified by Judge Coar on March 21, 2007, was proposed by Plaintiffs' counsel and certified as follows:

All persons (excluding federal, state, and local governmental entities and political subdivisions, the Defendants, and their respective parents, subsidiaries and affiliates) who purchased sulfuric acid in the United States directly from one or more of the Defendants or their parents, subsidiaries, affiliates, or joint ventures during the period January 1, 1988 through January 16, 2003. (Dkt. No. 536 ("Certification Order") at 2.)

In analyzing Plaintiffs' motion for class certification under Federal Rule of Civil Procedure 23, Judge Coar first found that Plaintiffs had satisfied the four requirements of Rule 23(a): numerosity, commonality, typicality, and adequacy of representation. (Id. at 3-9.) Defendants do not take issue with Judge Coar's findings, and this court need not further discuss the details of Judge Coar's reasoning on these points.

Judge Coar next analyzed whether Plaintiffs had demonstrated "that common questions of law or fact predominate over individual questions" under Rule 23(b)(3). (Id. at 9.) Noting that "questions of impact and damages revolv[ing] around individual determinations" had the potential to "move this case beyond the scope of permissible certification under Rule 23(b)(3)," Judge Coar determined that, at the class certification stage, "Plaintiffs need only establish that they have 'realistic methodologies for establishing damages on a classwide basis.'" (Id. at 10-11 (quoting In re Brand Name Prescription Drugs Antitrust Litig., 94 C 897, MDL 997, 1994 WL 663590, at *5 (N.D. Ill. 1994)) (Kocoras, J.).)*fn1 Specifically, Judge Coar required Plaintiffs to make "a threshold showing that what proof they will offer will be sufficiently generalized in nature" to warrant class treatment. (Id. at 15 (quoting In re Cardizem CD Antitrust Litig., 200 F.R.D. 297, 319 (E.D. Mich. 2000)).)

Judge Coar recognized that the parties' respective experts, Dr. Martin Asher testifying for Plaintiffs and Dr. Lauren Stiroh testifying for Defendants, disagreed on a number of factors relevant to the determination of class-wide damages, including the fungibility of sulfuric acid of different strengths across different geographic regions and "the conformity of the price changes across types and regions." (Id. at 15.) Judge Coar declined, however, to engage in a "battle of the experts" at the class certification stage, stating "this is not the right time . . . to launch into an extensive analysis of the facts or weighing of the merits." (Id.) Relying on "Dr. Asher's testimony, the likelihood that sulfuric acid can be treated as a fungible good, preliminary evidence that Defendants approached the market as one that was national in scope, and the possibility for adjusting the class mechanism in the future," Judge Coar found that Plaintiffs had made a "threshold showing" that they would be able to establish injury on a class-wide basis, thus satisfying the predominance requirement of Rule 23(b)(3). (Id. at 15-16.) Judge Coar also explicitly retained the ability to alter or amend the class certification order "should regional variations make the class untenable as defined." (Id. at 17 (citing Fed. R. Civ. P. 23(c)(1)(C).) Finally, Judge Coar found "provisionally" that "class certification presents the most efficient means of adjudicating the controversy," as required by Rule 23(b)(3). (Id.)

RELEVANT PROCEDURAL HISTORY

The class certification motion granted by Judge Coar on March 23, 2007, was initially filed by Plaintiffs on May 5, 2004, including Dr. Asher's 12-page expert report. (Dkt. No. 659 ("Defs.' Mem.") at 6-7; see also Dkt. Nos. 55-57.) During the course of subsequent pretrial discovery, however, Plaintiffs additionally identified two different individuals as their testifying experts: Dr. James McClave and Dr. Robert Tollison. (Id.)*fn2 After Judge Coar issued his March 21, 2007 order granting class certification, Defendants filed a motion to reconsider arguing that Plaintiffs had abandoned Dr. Asher as an expert witness. (Id.; see also Dkt. No. 537.) Judge Coar summarily denied Defendants' motion to reconsider without elaboration. (Id.; see Defs.' Ex. 4 ("4/11/2007 Tr.") at 3-4.)

Three and one-half years later, on September 24, 2010, Judge Coar granted in part and denied in part Defendants' motions for summary judgment. (Dkt. No. 601.) Defendants attempted to appeal portions of Judge Coar's Setpember 24, 2010 ruling, but the Seventh Circuit dismissed the interlocutory appeal for lack of jurisdiction on June 10, 2011. (Dkt. No. 674.)

As stated earlier, Judge Coar retired from the federal bench effective December 31, 2010, and the United States Judicial Panel on Multidistrict Litigation reassigned this case to this court's calendar on May 18, 2011. Also as stated earlier, Defendants filed ...


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