In re TFT-LCD (Flat Panel) Antitrust Litig.
| Decision Date | 03 April 2013 |
| Docket Number | No. M 07-1827 SI,MDL. No. 1827,M 07-1827 SI |
| Court | U.S. District Court — Northern District of California |
| Parties | In re: TFT-LCD (FLAT PANEL) ANTITRUST LITIGATION This Order Relates to: ALL INDIRECT-PURCHASER PLAINTIFF CLASS ACTIONS |
This matter has come before the Court to determine whether there is any cause why this Court should not approve the combined class, parens patriae, and governmental entity settlements between, on the one hand, the Indirect Purchaser Plaintiffs ("IPPs") and the States of Arkansas, California, Florida, Michigan, Missouri, New York, West Virginia, and Wisconsin ("Settling States") (collectively, the "Settling Plaintiffs"), and, on the other hand, the AUO, LG, and Toshiba Defendants - as identified in each of the Proposed Settlements, and inclusive of named related entities (collectively the "Settling Defendants"), set forth in the Settlement Agreements ("Agreements") filed with this Court relating to the above-captioned litigation. On November 29, 2012, the Court conducted a fairness hearing addressing whether the Settlements were fair, adequate, and reasonable, and on January 31, 2013, the Court conducted a hearing to address attorneys' fees, expenses, and incentive awards. The Court, after carefully considering all papers filed and proceedings held herein and otherwise being fully informed in the premises, has determined (1) that the Settlements should be approved; (2) that attorneys' fees,expenses, and incentive awards should be awarded and allocated as directed by this Order, and (3) that there is no just reason for delay of the entry of this final judgment approving the Agreements. For the following reasons, the Court GRANTS final approval to the Settlements. The Court also awards attorneys' fees, expenses, and awards as detailed below.
This antitrust class action stems from allegations of a global price-fixing conspiracy in the market for thin-film transistor liquid-crystal display panels ("TFT-LCD"). TFT-LCD panels are used in a number of products, such as computer monitors, notebook computers, and televisions. See generally Order Granting Indirect Purchaser Plaintiffs' Motion for Class Certification (March 28, 2010), Docket No. 1642, at 1-3; Indirect Purchaser Plaintiffs' Third Consolidated Amended Complaint, Docket No. 2694, ¶¶ 16-54. Defendants manufacture the panels, which are then sold and assembled into finished products. The panels have no independent utility, and are not available to the average consumer. Instead, they are incorporated into finished products as discrete, physical objects within the product.
Plaintiffs are a class of retail purchasers who purchased products containing TFT-LCD panels in the United States. The indirect purchaser plaintiffs filed this multidistrict antitrust class action on behalf of all persons and entities who indirectly purchased TFT-LCD panels (contained in TFT-LCD products) manufactured, marketed, sold and/or distributed by one or more of the defendants, for the indirect purchasers' end use and not for resale. Third Consol. Amend. Compl. at ¶ 16. Plaintiffs bought TFT-LCD products containing TFT-LCD panels either from (1) TFT-LCD panel direct purchasers, such as Dell, Hewlett-Packard, and Apple, which incorporate TFT-LCD panels into final, branded TFT-LCD products and sell directly to the public, or (2) retailers, such as Best Buy, Wal-Mart, or Target, which acquire the TFT-LCD products from TFT-LCD panel direct purchasers or distributors.
Plaintiffs alleged a "long-running conspiracy extending from at least January 1, 1999 through at least December 31, 2006, at a minimum, among defendants and their co-conspirators, the purpose and effect of which was to fix, raise, stabilize, and maintain prices for LCD panels sold indirectly to Plaintiffsand the members of the other indirect-purchaser classes . . . ." Id. at ¶ 1. Plaintiffs sought equitable relief under Section 16 of the Clayton Act, 15 U.S.C. § 26, based on alleged violations of Section 1 of the Sherman Act, 15 U.S.C. § 1, as well as restitution, disgorgement, and damages under the antitrust, consumer protection, and unfair competition laws of 23 states.1
On March 28, 2010, the Court granted indirect purchaser plaintiffs' motion for class certification, certifying a nationwide class and twenty-three statewide classes. See Order Granting Indirect Purchaser Plaintiffs' Motion for Class Certification, Docket No. 1642, at 35. Additionally, in July 2011, the Court certified a Missouri monetary-relief class. Docket No. 3198.
The Settling States filed complaints in various federal and state courts beginning in mid-2010. The actions assert claims and seek various forms of relief against the defendants arising from indirect purchases made by governmental entities, and/or by consumers of TVs, notebook computers, and monitors containing LCD Panels under each Settling State's parens patriae authority, proprietary claims, and enforcement authority pursuant to both federal and state law. The Settling States have previously summarized some of the key events of their investigation and litigation, including motion practice and discovery work that preceded the previously-approved settlements. See Docket No. 4424 (); Docket No. 5600 (); Docket No. 6860 ().
On January 26, 2012, the Court granted preliminary approval to settlements totaling $538.6 million with the Chimei, Chunghwa, Epson, HannStar, Hitachi, Samsung, and Sharp Defendants ("Round1 Settlements"). Docket No. 4688.2 The Court granted final approval to these settlements on July 11, 2012. See Docket No. 6130.
With respect to the remaining defendants (AUO, LG, and Toshiba), the IPPs and Settling States engaged in arm's-length negotiations with Settling Defendants, resulting in each Proposed Settlement ("Round 2 Settlements"). The Court granted preliminary approval to these Settlements on July 31, 2012. See Docket No. 6311. Subsequent to that Order, IPPs filed a Motion for Final Approval, see Docket No. 7158, as well motions for attorneys' fees, expenses, and incentive awards, see Docket No. 5157, 6662, and 6664. Settling States also filed motions for attorneys' fees and expenses, see Docket No.5157 and 6860, and counsel for three separate objectors filed motions for attorneys fees, see Docket Nos. 6830/7195, 7200, and 7211.
On August 9, 2012, the Court issued an order appointing Martin Quinn as Special Master, see Docket No. 6580,3 and referred to him the task of assisting the Court by issuing reports and recommendations on the subjects of: The Court granted the Special Master authority to communicate ex parte with counsel "in order to facilitate the fair and effective performance of his duties regarding attorneys' fees and expenses . . . "
Most of the key terms of these Round 2 Settlements are substantially similar to the terms in the Round 1 Settlements, with the exception of the payment amounts and cooperation provisions. Notably,the releases largely mirror the releases in the previously approved settlements. The key terms are described below.
Settling Defendants will pay a total of $571 million: $27.5 million has been paid to Settling States in resolution of their civil penalties claims, and $543.5 million represents consumer redress under the Proposed Settlements. The breakdown of total settlement payments by Defendant is as follows: AUO - $170,000,000; LG Display - $380,000,000; Toshiba - $21,000,000.
In addition to the cash payments, AUO and LG Display agree, for a period of up to 5 years, not to engage in price-fixing, market allocation, bid rigging, or other conduct that constitutes a per se violation of Section 1 of the Sherman Act, with respect to the sale of any LCD panels, or TVs, notebook computers, or monitors containing LCD panels likely, through the reasonably anticipated stream of commerce, to be sold to end-user purchasers in the U.S. Additionally, each settling defendant continuing to manufacture LCD panels agrees to establish an antitrust compliance program for officers and employees responsible for pricing or production capacity of LCD panels. Each defendant will certify that it is complying with this obligation in an annual written report for the next 5 years (3 years for Toshiba). Lastly, AUO and LG Display are obligated to provide cooperation to the IPPs and Settling States in the event that one or more of the settlements is not approved.
For the class period of January 1, 1999 - December 23, 2006, the IPPs release all claims for monetary relief held by indirect-purchaser end-user consumers in the certified statewide monetary relief classes (and the proposed settlement-only classes). They also release, for the time period January 1, 1999-February 13, 2012, all claims for injunctive relief held by indirect-purchaser end user consumers in the previously certified nationwide Sherman Act injunctive relief cases.
Settling States release all claims that were asserted and all claims that could have been asserted in each Settling State's respective action, arising in any way from the sale of LCD Panels and based on any form of alleged anticompetitive conduct occurring on or before December 31, 2006, including claimsbased on governmental entity purchases and applicable parens patriae claims, based on the...
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