Toshiba’s Road Gets Steeper in Price-Fix Case

OAKLAND, Calif. (CN) — A federal judge Tuesday rejected two motions from Toshiba, seeking to dismiss or compel arbitration in Dell's price-fixing antitrust complaint involving lithium ion batteries.

Dell accused Toshiba and 12 other defendants in June 2015 of conspiring to fix battery prices as part of a larger multidistrict class action, still pending in the Northern District of California.

Dell said in its motion to dismiss that it paid the defendants more than $3.1 billion for batteries from the defendants over the course of the 11-year conspiracy.

Sony settled antitrust claims against it for $19 million in the multidistrict litigation in September, making it the first defendant to do so.

In its motion to dismiss, Toshiba said Dell had not provided enough information about the antitrust claim assignments it received from its subsidiaries, failing to identify the assignors, what they bought, from whom they bought them, and where they bought them, rendering the complaint too "indefinite and unintelligible" to file a response.

Dell said in opposition that it gave all of that information to Toshiba in July, and that when it asked Toshiba to withdraw its motion, Toshiba refused.

U.S. District Judge Yvonne Gonzalez Rogers had harsh words for Toshiba at a hearing last week, telling its attorney J. Frank Hogue: "I do not take kindly to churning cases."

Hogue told Gonzalez that Toshiba did not withdraw its motion because the information Dell produced was still insufficient, as it did not identify which assignments came from foreign subsidiaries, which Toshiba says is grounds for dismissal.

In a Tuesday order, Gonzalez agreed with Dell that the information it provided is sufficient. She denied Toshiba's request that Dell provide more detailed information if she rejects its motion for dismissal.

Hogue declined to comment on the rulings Tuesday.

In denying Toshiba's request for dismissal, Gonzalez wrote: "Given the nature of plaintiffs' overall allegations and the production of the assignment agreements themselves, the court finds that Toshiba's asserted deficiencies in the complaint have been cured."

But Gonzalez ordered Dell to file a statement on how the claim assignments relate to Foreign Trade Antitrust Improvements Act requirements, saying the law could affect Dell's case.

"Given the potential for motion practice relative to the FTAIA, a precise articulation of the facts relative to those issues promotes efficiency," Gonzalez wrote.

Also Tuesday, Gonzalez Rogers denied Toshiba's motion to compel Dell to arbitrate its antitrust claim, saying Toshiba's arguments "do not persuade."

Dell claim s that all of the defendants are responsible for the batteries it bought from any defendant during the price-fixing conspiracy, including purchases it made under master purchase agreements with Panasonic and Sanyo.

The master purchase agreements contain arbitration clauses. Toshiba argued that though it is not a signatory to them, if it is to be held responsible for the inflated battery purchases under them, it can compel Dell to arbitrate its claim under equitable estoppel.

Dell countered that it never agreed to arbitrate with Toshiba, and that equitable estoppel does not apply to the case.

Gonzalez agreed with Dell.

"Toshiba offers no support for its proposition that, simply because an arbitration agreement exists, Toshiba, as a non-signatory to such agreements, can compel plaintiffs into arbitration," the judge wrote.

"While relevant, the [master purchase agreements] are just one piece of a much larger claim."

Dell is represented by Debra Bernstein with Alston & Bird in Atlanta, who could not be reached for comment Tuesday evening.

Hogue is with White & Case in Washington, D.C.

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