Mitsubishi Alone in Price-Fixing Case

     SAN FRANCISCO (CN) – A federal judge certified a class of “direct purchasers” in a worldwide antitrust case that claims Mitsubishi conspired to corner the market on cathode-ray tubes.
     Mitsubishi is the sole remaining defendant in the 8-year old case against multiple defendants, which once included Toshiba, Hitachi, Samsung, Matsushita Industrial Electrical, Chunghwa Picture Tubes and others.
     Most settled: Samsung for $33 million, LG for $25 million and Hitachi for $13.4 million.
     Cathode ray tubes, or CRTs, were the picture screens of the original televisions. They are vacuum tubes with an electron gun in back that shoots rays across a fluorescent-backed, glass screen to produce images.
     The technology became obsolete with the advent of liquid crystal and plasma display panels, but prices on the tubes remained steady, raising suspicions that prices were being fixed.
     Dozens of lawsuits were filed after the European Commission announced on Nov. 8, 2007 that it was investigating whether there was a worldwide conspiracy.
     The lawsuits evolved into two classes: indirect purchasers, who bought products containing the tubes; and direct purchasers, who bought the tubes alone.
     “Defendants’ conspiracy was intended to, and did, moderate the downward price pressures of CRT products caused by the market entry and rapid penetration of more technologically advanced competitive products,” according to the original 2007 class action.
     U.S. District Judge Samuel Conti certified the direct purchaser group against Mitsubishi on Wednesday.
     Conti cited an extensive, sealed report by direct purchaser class expert Jeffrey Leitzinger, an economist and managing director at Econ One Research, an research and consulting firm.
     He noted that Mitsubishi did not submit an expert report of its own in response to the Leitzinger report, and that the company “did not necessarily oppose the conspiracy prong,” but did dispute the impact and damages prongs required for class certification in an antitrust case.
     “In this case, Dr. Leitzinger reviewed evidence of the alleged conspiracy and then formed an opinion that there is evidence common to members of the proposed class that is sufficient to prove widespread impact,” Conti wrote in a 50-page order.
     Conti said that Leitzinger could successfully calculate classwide overcharges for the damages prong.
     “He [Leitzinger] could take the CRT sales data and calculate sales by defendants and co-conspirators to class members for each year, and then apply the overcharge percentages for each type of CRT per year to get the overcharge amount associated with each type of CRT each year,” Conti ruled. “In the same manner, he could compute the damages to purchasers of CRT finished products. To do so, Dr. Leitzinger would calculate the average annual dollar overcharge for a given CRT and multiply it by the corresponding units of CRT finished product sales for the class members. Adding totals across products over time would yield the total damages.”
     Conti concluded that “upon completion of a ‘rigorous analysis’ of the required elements of class certification, for good cause shown, the court finds that all the threshold and minimum requirements … have been met.”
     Conti granted the class 30 days to amend the complaint for the sole purpose of specifically identifying the Mitsubishi affiliates and class members, for notification.
     A call to class attorneys Guido and R. Alexander Saveri of Saveri & Saveri, in San Francisco, was not immediately returned.
     Mitsubishi attorney Brent Caslin of Jenner & block, in Los Angeles, could not be reached for comment.

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