In re Mid-Atlantic Toyota Antitrust Litigation, MDL-456. Civ. A. No. Y-80-3238
| Decision Date | 27 May 1983 |
| Docket Number | Y-81-806 and Y-81-2954.,Y-81-726,Y-81-805,Y-81-650,Y-82-479,Y-81-1880,MDL-456. Civ. A. No. Y-80-3238 |
| Citation | 564 F. Supp. 1379 |
| Parties | In re MID-ATLANTIC TOYOTA ANTITRUST LITIGATION. STATE OF MARYLAND ex rel. SACHS v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. STATE OF DELAWARE ex rel. GEBELEIN v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. STATE OF WEST VIRGINIA ex rel. BROWNING v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. DISTRICT OF COLUMBIA ex rel. ROGERS v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. COMMONWEALTH OF PENNSYLVANIA on its own Behalf and as Parens Patriae v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. COMMONWEALTH OF VIRGINIA v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. Daniel E. GOLUB, et al. v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. Wallace H. JOHNSTON, Jr., et al. v. MID-ATLANTIC TOYOTA DISTRIBUTORS, INC., et al. |
| Court | U.S. District Court — District of Maryland |
Charles O. Monk, III, Asst. Atty. Gen., and Michael F. Brockmeyer, Asst. Atty. Gen., Baltimore, Md., for plaintiffs.
Raymond W. Bergan, Williams & Connolly, Benjamin R. Civiletti, Venable, Baejter, Howard, & Civiletti, Washington, D.C., for defendants Mid-Atlantic Toyota Distributors, Inc., Carecraft Industries, Ltd., and Frederick R. Weisman.
The above numbered action is a multidistrict antitrust litigation involving six parens patriae actions, 15 U.S.C. § 15c, and two private treble damage actions, 15 U.S.C. § 15. See generally In Re Mid-Atlantic Toyota Antitrust Litigation, 560 F.Supp. 760 (D.Md.1983). All plaintiffs and several defendants have submitted a proposed settlement ("the Settlement") to the Court for approval pursuant to 15 U.S.C. § 15c(c) and Fed.R.Civ.P. 23(e). The Court has heard the parties' comments on the terms of the Settlement at open hearings on April 29, 1983 and May 26, 1983. In addition, all parties have submitted lengthy memoranda outlining their views on the merits of the Settlement. After careful consideration of the parties' contentions and the relevant authorities, the Court enters an order preliminarily approving the Settlement in its entirety and conditionally determining a temporary settlement class ancillary to the main parens patriae classes. The Court stresses the preliminary and conditional nature of these two rulings; they will be followed by another hearing and ruling on 1) the final approval of the Settlement and 2) the possible certification of a permanent settlement class. The principal legal effect of the present order is to allow notice to issue to the potential beneficiaries of the Settlement. The Court will make a final adjudication of the rights of these potential beneficiaries only after they have had a full opportunity to be heard and to exercise any "opt-out" rights they may possess. A fuller explanation of the details of and legal basis for these rulings follows.1
All plaintiffs have sued two classes of defendants: Toyota dealers in Delaware, Maryland, Pennsylvania, Virginia, West Virginia, and the District of Columbia ("Dealer defendants"); and several entities essentially comprising the single Toyota distributor for the six jurisdictions ("Distributor defendants").2 The plaintiffs allege that both sets of defendants have conspired together in violation of § 1 of the Sherman Act, 15 U.S.C. § 1, to force purchasers of certain new 1980 Toyotas to pay more for their cars than they would have paid in the absence of a conspiracy. After extensive briefing by the parties, the Court, at some length, denied the bulk of defendants' motions for summary judgment and held that the case could proceed to trial under a per se theory of liability. In Re Mid-Atlantic Toyota Antitrust Litigation, 560 F.Supp. 760 (D.Md.1983).
While the summary judgment motions were sub curia, counsel for the plaintiffs and Distributor defendants commenced serious settlement negotiations in December, 1982. The negotiating parties did not permit Dealer defendants to participate in these discussions, although they informed Dealer defendants of the basic form of the Settlement by the middle of March, 1983. After four months of intensive negotiations, plaintiffs and Distributor defendants signed the Settlement on April 14, 1983. The Settlement does not purport to seek an order of the Court unilaterally altering any of the formal, legal rights of the non-signatory Dealer defendants. However, the Settlement does give each Dealer defendant the option of joining in the Settlement on or before May 29, 1983. An attempt at a "global" resolution of this litigation, the Settlement explicitly informs the Dealer defendants of the rights and liabilities they would assume if they choose to join. In addition, the Settlement warns them, in advance, that plaintiffs have reserved the option to rescind their agreement with any individual Dealer defendant if the number of Dealer defendants joining the Settlement does not reach a certain "critical mass."3 The Settlement is intended to be final as between the plaintiffs and Distributor defendants regardless of the number of Dealer defendants who elect to join.
The Settlement is lengthy and complex and the Court will summarize only its most salient features, focusing primarily on the results contemplated if all Dealer defendants join the Settlement. In such a situation, the Settlement mandates the issuance of "certificates" or "scrips" to eligible class members. With one small exception, each of the certificates may be redeemed for (1) $250.00 worth of retail value goods, services or trade-in allowance from a participating Dealer defendant, (2) $135.00 in cash, or (3) some proportionate mixture of the two. While the certificates are freely negotiable for redemption in cash, only the initial recipient of the certificate may exercise the goods, services or trade-in allowance option. These certificates will be distributed to all those who purchased a new 1980 Toyota from one of the Dealer defendants, provided that the vehicle purchased had an accessory which (1) had a list or "sticker" price of at least $425.00 and (2) had at least two of the five components of the so-called "Protective Package" which has formed the basis of this litigation: rust-proofing, exterior paint sealant, undercoating, fabric or vinyl interior protection, and a motor club membership.
The Settlement provides an elaborate procedural mechanism, complete with an adjudicative "Settlement Committee," for determining the identities and number of the actual beneficiaries of the Settlement. While its intricacies need not be outlined here, the Court stresses that all who purchased a new 1980 Toyota from one of the Dealer defendants will be provided with notice and an opportunity to be heard on the issue of whether they qualify as beneficiaries of the Settlement.
The cost of redeeming the certificates will be borne by a Settlement Fund. The Fund shall consist of a contribution of up to $2,900,000.00 from the Distributor defendants, a contribution of up to $1,925,000.00 from the Dealer defendants, and accrued interest. The defendants will be permitted to make less than their maximum contributions only if the total number of identified beneficiaries falls below the 35,000 currently estimated by the parties. The anticipated accrual of interest will allow the issuance of certificates for their full value for up to 36,500 beneficiaries. If the number of beneficiaries exceeds 36,500, then the value of an individual certificate may be reduced.
A Settlement beneficiary may either (1) cash the certificate directly, (2) obtain goods, services or trade-in value from a Dealer defendant, or (3) obtain a proportionate combination of cash, goods, services or trade-in allowance from a Dealer defendant.4 If the beneficiary exercises any of these options with a Dealer defendant, the Distributor defendants will reimburse the Dealer defendant $135.00, and will in turn be reimbursed by the Settlement Fund $135.00. Thus, as the certificate entitles the beneficiary to $250.00 worth of retail value goods, services or trade-in allowance, but the Dealer is only reimbursed $135.00 in cash, the Dealer defendant absorbs the $115.00 differential of lost retail profit, overhead, or direct costs.
Plaintiffs waive all rights to attorney's fees, except that they reserve the right to receive, in an amount approved by the Court, a segment of any excess Settlement Fund interest remaining after all claims and certain costs have been satisfied. Plaintiffs' counsel currently estimate that they will receive only a small fraction of the fees they have incurred in this case.5
The above scenario will only occur if all of the Dealer defendants join in the Settlement. The result occurring if less than all of the Dealer defendants join depends upon the number who join. If Dealer defendants accounting for at least two-thirds of the relevant 1980 transactions opt in, then plaintiffs will either (1) reduce the value of the certificates or (2) delay their disbursement to allow accrued interest and possible executed judgments to make up the shortfall. If less than two-thirds opt in, then plaintiffs will elect either to (1) accept payments from the joining Dealer defendants or (2) rescind the Settlement with all joining Dealer defendants and continue the litigation with the Dealer defendants as a group. In any of these scenarios, the Distributor defendants will be dismissed from the case upon their payment of the amounts agreed upon and their cooperation in any continuing litigation against Dealer defendants.
The Settlement sets out the following schedule:
To continue reading
Request your trial
-
Matter of Skinner Group, Inc.
...Horton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 855 F.Supp. 825, 827-28 (E.D.N.C.1994); In re Mid-Atlantic Toyota Antitrust Litigation, 564 F.Supp. 1379, 1384-85 (D.Md.1983). Provided that such initial endorsement is granted, the court later conducts a final hearing regarding the set......
-
General Motors Corp. Pick-Up Truck Fuel Tank Products Liability Litigation, In re
...re Bendectin, 102 F.R.D. 239, 240 (S.D.Oh.1984), rev'd on other grounds, 749 F.2d 300 (6th Cir.1984); In re Mid-Atlantic Toyota Antitrust Litig., 564 F.Supp. 1379, 1388-90 (D.Md.1983); In re Chicken Antitrust Litig., 560 F.Supp. 957, 960 There has been a great deal of commentary, both criti......
-
In re Joint Eastern & Southern Dist. Asbestos Lit.
...182, 93 L.Ed.2d 117 (1986). See also In re First Commodity Corp., 119 F.R.D. 301, 306-08 (D.Mass.1987); In re Mid-Atlantic Toyota Antitrust Litig., 564 F.Supp. 1379, 1388-90 (D.Md.1983). But see In re Bendectin Prods. Liab. Litig., 749 F.2d 300, 305 (6th After the Eighth Circuit vacated a m......
-
Linton v. Consumer Prot. Div.
...merits against the amount offered in settlement.’ " Shenker , 226 Md. App. at 688, 130 A.3d 1171 (quoting In re Mid-Atl. Toyota Antitrust Litig. , 564 F. Supp. 1379, 1384 (D. Md. 1983) ). The trial court must consider the following factors:(1) [T]he relative strength of the plaintiffs' case......
-
Antitrust Class Action Settlements
...11. MANUAL FOR COMPLEX LITIGATION (FOURTH) § 21.612 (2007). 12. See id. 13. See, e.g. , In re Mid-Atlantic Toyota Antitrust Litig., 564 F. Supp. 1379, 1385 n.8 (D. Md. 1983) (granting preliminary approval to partial settlement before examining the states’ economic evidence because “[p]roduc......
-
Introduction
...ex rel . Smith v. Cargo Gasoline Co., 1986-1 Trade Cas. (CCH) ¶ 66,928 (M.D. Fla. 1985); In re Mid-Atl. Toyota Antitrust Litig., 564 F. Supp. 1379, 1383 (D. Md. 1983); New York v. Dairylea Coop., 547 F. Supp. 306 (S.D.N.Y. 1982); In re Montgomery County Real Estate Antitrust Litig., 83 F.R.......
-
Table of Cases
...79 (2003), 52 Microsoft Corp. Antitrust Litig., In re, 218 F.R.D. 449 (D. Md. 2003), 17 Mid-Atlantic Toyota Antitrust Litig., In re , 564 F. Supp. 1379 (D. Md. 1983), 223 Milk Prods. Antitrust Litig., In re , 195 F.3d 430 (8th Cir. 1999), 147, 167 Miller ex rel S.M. v. Bd. of Educ., 455 F. ......