(CN) - The world's largest zipper makers will pay just $17.55 million to settle claims that they conspired to fix the prices of clothing fasteners for decades, a federal judge ruled.
After the European Commission announced in 2007 a roughly $458 million fine, later reduced to $429 million, against manufacturers "for operating cartels on the markets for fasteners and attaching machines," 35 apparel companies filed federal complaints that were consolidated into a single class action in Philadelphia.
The plaintiffs allege that Tokyo-based YKK Corp. conspired with a select group of international companies to "allocate customers and markets; fix prices, including minimum, average and target prices; monitor price increases; and coordinate price increases" for "zippers, snap fasteners, jeans buttons, hooks and eyes, clamping locks, clip fasteners and rivets."
The defendants allegedly met to sign "anticompetitive agreements" from the mid-1970s until about 2003.
"Specific prices were set for certain individual countries and a separate minimum price was set for the rest of the world, which included the United States," the complaint states.
Senior management for YKK, Georgia-based Scovill Fasteners, and a German group of companies called the Prym Group allegedly began meeting in so-called "work circles" under the auspices of a German trade association in 1991 to discuss strategies to manipulate competition.
Though the defendants claimed the class action is time-barred, U.S. District Judge Barclay Surrick refused to dismiss the suit in 2011.
Within weeks, the judge preliminarily approved proposed settlements with YKK, Prym and U.K.-based Coats Holdings.
Scovill filed for bankruptcy that year and it was dismissed from the case this past summer.
The court defined the class as all those who bought fasteners in the United States directly from a defendant from Jan. 1, 1991, to Sept. 19, 2007, excluding defendants and their predecessors, successors, parents, subsidiaries, affiliates, and divisions, as well as governmental entities.
Prym, YKK and Coats will pay a total of $17.55 million under the proposed settlements.
Judge Surrick finally approved the settlements Jan. 24.
"The reaction of the class to the proposed settlements has been overwhelmingly supportive," Surrick wrote. "Approximately 32,359 copies of the notice of proposed settlement were sent out to potential class members. Not one of the class members filed an objection either to the terms of the proposed settlements or to class counsel's fee application. In addition, only one of the class members sought exclusion from the settlement class."
The judge later added: "We find it striking that in a potential class this large, not one class member lodged an objection to the proposed settlements. This factor weighs strongly in favor of finding the settlements fair, reasonable, and adequate."
As the Prym defendants provided interviews and "extensive information and documents" under a cooperation provision in the settlement, discovery was sufficient, the ruling states.
"Absent class certification, this court and others would be faced with numerous lawsuits, all arising out of the same alleged illegal conduct," Surrick wrote. "Proceeding as a class action is the superior course not only because it will avoid unnecessarily wasting judicial resources, but also because it avoids the possibility of contradictory results."
YKK reportedly netted about $5.68 billion in sales in 2012-13, while Coats made more than $1.65 billion in revenue in 2012.
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