News Corp. sued in advertising antitrust class action

Posted on: July 31st, 2015 by Steve Larson
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An antitrust lawsuit against News Corp. has been certified as a class action.  New York U.S. District Judge William Pauley said consumer packaged goods companies such as Dial Corp., H.J. Heinz Co. and Smithfield Foods Inc. may pursue their antitrust claims as a class action.

The litigation is part of a long-running battle over News Corp.’s marketing operations.  In January 2010, the New York-based company agreed to pay $500 million to end rival Valassis Communications Inc.’s antitrust lawsuit over the newspaper coupon market.

News Corp. has an estimated 80 percent of the U.S. market for in-store promotion services, where it acts as a middleman to help companies promote goods through coupon dispensers, electronic signs, end-of-aisle displays and shopping cart ads.

The plaintiffs said News Corp. has monopolized this market since 2004 by locking up exclusive long-term contracts with retailers.

They said this anticompetitive conduct has forced them to pay artificially high prices to promote such goods as Dial soap, Heinz ketchup and Smithfield’s Eckrich hot dogs.

In certifying a class action from April 5, 2008 to the present, Pauley rejected News Corp.’s arguments that damages would be too hard to measure.  He noted that the plaintiffs’ damages expert estimated overcharges of 31 percent to 43 percent in the 2008-13 period.

The judge also said “central questions regarding liability” for alleged supra-competitive prices were “susceptible to common proof” that could be addressed in a single trial.

The case is Dial Corp., et al v. News Corp., et al, U.S. District Court, Southern District of New York, No. 13-06802.