Antitrust Law Daily Class certification denied in ion battery suit for a third time
Wednesday, September 5, 2018

Class certification denied in ion battery suit for a third time

By Jody Coultas, J.D.

A third motion to certify a class of indirect purchasers of lithium ion batteries who sued Japanese and Korean battery manufacturers for engaging in an international price fixing conspiracy was stricken by the federal district court in Oakland, California, because the motion was not based on any new evidence, clear error, or change in the law. The court also noted that the motion was filed without first seeking leave to file it, and was submitted on the deadline in the scheduling order for the filing of summary judgment motion and Daubert motions (In re: Lithium Ion Batteries Antitrust Litigation, September 4, 2018, Rogers, Y.).

Two separate classes—direct purchasers of lithium ion batteries and indirect purchasers of lithium ion batteries—sued a collection of Japanese and Korean manufacturers in California federal court for engaging in a scheme to fix the price of lithium ion batteries. According to the complaint, Sony Corporation, which invented the lithium ion battery, dominated the market from 1991 until about 1999, when LG and Samsung entered the market with their own lithium ion batteries. Beginning in about 2002, the plaintiffs alleged, the Japanese and Korean manufacturers began meeting semi-annually to refrain from competing with one another. Evidence of the conspiracy, they contended, can be seen in the fact that all the manufacturers raised their battery prices in unison in 2007, when the price of cobalt increased sharply, and then all kept their prices artificially high in unison in 2008 when the price of cobalt dropped again.

The direct and indirect purchasers were denied class certification in April 2017, because they could not satisfy the certification requirement that the claims of the class representatives be typical of the class as a whole. The motions for class certification were denied without prejudice, giving the plaintiffs the opportunity to address at some later point the shortcomings the court identified in their certification motions.

In March 2018, the court denied the indirect purchaser plaintiffs’ (IPPs’) second motion for class certification and the Ninth Circuit denied permission to appeal the denial. The IPPs then filed a third class certification motion without first seeking leave from the court or mentioning that they intended to file a third class certification motion in any case management or other filing. While the scheduling order was silent as to the filing of a third class certification motion, the entire case plan depended upon class certification being settled once the court decided the second class certification motion.

Allowing the third class certification motion in this case would set a dangerous precedent, according to the court. The IPPs’ motion fell outside the court’s scheduling order and management of the actions, and was filed without any request or justification for seeking leave to do so. This holds especially true in the context of multidistrict litigation. Also, the IPPs’ third certification motion seeks to certify a narrower class, relying upon the same methodologies and same transactional sales data used by their expert in the prior motions. While the expert opinions were revised and the class definition narrowed, there were no "changed circumstances." The addition of testimony from company representatives that could have been offered earlier, did not alter the analysis. Reconsideration of a prior order such as the one at issue should be denied in all but the most unusual circumstances, and certainly not when "used to raise arguments or present evidence for the first time when they could reasonably have been raised earlier in the litigation."

The case is No. 13-MD-2420 YRG.

Attorneys: Jeff D. Friedman (Hagens Berman Sobol Shapiro LLP) for Kevin Young. John Roberti (Allen & Overy LLP) for Samsung SDI America Inc. Craig P. Seebald (Vinson & Elkins LLP) for Hitachi Ltd. Craig P. Seebald (Vinson and Elkins LLP) for Maxell Corp. of America.

Companies: Samsung SDI America Inc.; Hitachi Ltd.; Maxell Corp. of America

MainStory: TopStory Antitrust CaliforniaNews

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