Lear to pay $8.75 million to settle auto parts antitrust claim

May 21, 2014 by

CarLear Corp. will pay $8.75 million to settle claims it conspired with other auto-parts manufacturers to fix the prices of automotive wire harnesses.

Although Lear did not admit to any wrongdoing, the manufacturer will pay $8.75 million in cash and stock to direct and indirect purchasers of the automotive wire harnesses in order to settle the consolidated cases.

As part of the settlement, Lear will fork over $370,263 in cash, while paying the rest in outstanding stock and warrants it had set aside as part of a bankruptcy reorganization, according to the SEC filing. The Southfield, Michigan-based company, which primarily manufactures parts for automobile seats, emerged from bankruptcy in 2009.

Although the settlement resolves claims brought on behalf of direct and indirect purchasers, Lear is still involved in a price-fixing class action brought by “public entities” such as states and agencies in Michigan federal court, the company said. Lear is also fighting similar antitrust claims in Canadian courts.

Lear is just one one several auto-parts manufacturers accused of price-fixing automotive wire harnesses, as Yakazi Corp., Denso Corp. and several other companies have also been named as defendants.

In June, U.S. District Judge Marianne O. Battani trimmed some indirect purchaser claims over the alleged automotive wire harnesses price-fixing but refused to toss federal antitrust claims lodged by a group of direct purchasers.

Recently, the defendants asked Judge Battani to dismiss some state law claims brought by the subset of “end payor” indirect purchasers, arguing the plaintiffs were barred from asserting class claims under the South Carolina Unfair Trade Practices Act and did not allege sufficient injury to lodge a complaint under the Arkansas Deceptive Trade Practices Act.

The suits over automotive wire harnesses price-fixing are part of a broader MDL regarding alleged antitrust violations in the markets for other car parts, such as bearings, radiators and alternators, according to the consolidated court docket.

The MDL contains allegations similar to those under investigation by the DOJ, which has netted guilty pleas and criminal fines from several companies and executives in connection with its probe.

In late April, Judge Battani refused to dismiss proposed class actions brought by direct purchasers of heater control panels, instrument panel clusters and “fuel sender” devices that measure fuel levels in gas tanks, ruling that the plaintiffs had shown the manufacturers could have plausibly engaged in price-fixing schemes.

The plaintiffs are represented by Robins Kaplan Miller & Ciresi and Stoll Berne, among others.

The case is In re: Automotive Parts Antitrust Litigation, case number 2:12-md-02311, in the U.S. District Court for the Eastern District of Michigan.

Steve Larson
An experienced trial lawyer who handles both hourly and contingent fee cases, Steve has expertise in class actions, consumer cases, antitrust litigation, securities litigation, corporate disputes, intellectual property disputes, unfair competition claims, employment matters, and disputes involving family wealth. Steve regularly represents individuals and businesses in federal and state court and has obtained class-wide recovery in multiple class actions. A veteran practitioner, Steve's clients value his creative approach to resolving complex litigation matters.

Legal Disclaimer

The information contained in this blog does not constitute legal advice, and does not create an attorney-client relationship. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the information contained in or linked to this blog.