News

Long-Running Drywall Price-Fixing Lawsuit Settles for More Than $190 Million

DATE: July 24, 2018
PRACTICE AREAS: Antitrust

Berger Montague is pleased to announce that on July 17, 2018, Judge Michael M. Baylson of the U.S. District Court for the Eastern District of Pennsylvania issued an order approving the last of the settlements in the long-running case In re Domestic Drywall Antitrust Litigation. This latest settlement brings the total amount of settlements for the class to over $190 million.

Direct Purchaser Class Plaintiffs alleged that the dominant drywall manufacturers in the United States engaged in a conspiracy from 2012 – 2013 to fix drywall prices in the U.S. and abolish the industry’s longstanding practice of limiting price increases for the duration of a construction project through “job quotes.” USG Corporation and United States Gypsum Company (collectively, “USG”), New NGC, Inc., Lafarge North America Inc., Eagle Materials, Inc., American Gypsum Company LLC, TIN Inc. d/b/a Temple-Inland Inc., and PABCO Building Products, LLC were named as defendants.

Berger Montague served as co-lead counsel on behalf of a class of direct purchasers of drywall, along with Cohen Milstein Sellers & Toll, PLLC and Spector Roseman & Kodroff, P.C.

Concurrent with approval of the settlement, Judge Baylson also issued a lengthy opinion awarding counsel for the Direct Purchaser Class Plaintiffs one-third of the total settlement fund as attorneys’ fees. Judge Baylson remarked that “the performance of Plaintiffs’ counsel on the class action issues was imaginative, bringing forth great quantity of persuasive evidence that common issues predominated and that the Plaintiffs’ case had merit…The class counsel exhibited skill and efficiency at all times.”

Judge Baylson also spoke to the societal value of antitrust class actions, which particularly benefit those who purchased goods at anticompetitive prices:

“Class action status – although much has been written of some abuses in the bringing of class actions, in the Court’s view, the substantial results warrant a conclusion that in an antitrust price-fixing case, class actions have resulted in multi-billion dollars in damages, that have been paid out by defendants who were either convicted of price-fixing in criminal cases, found liable in civil cases, or as in this case, agreed to settle. Thus, as far as antitrust price-fixing cases are concerned, Rule 23 has been not only generous to the attorneys who bring these cases, but much more so to individuals who have paid higher prices for various goods, over many decades, and would not have collected anything but for the efforts of plaintiffs’ class action counsel.”

This case was initiated in late 2012. The district court previously approved three other settlements. On August 20, 2015, the district court granted final approval of two settlements—one with USG and the other with TIN Inc.—totaling $44.5 million. On December 8, 2016, the district court granted final approval of a $21.2 million settlement with Lafarge North America, Inc.

On February 18, 2016, the district court denied the motions for summary judgment filed by American Gypsum Company, New NGC, Inc., Lafarge North America Inc., and PABCO Building Products. On August 23, 2017, the district court granted direct purchaser plaintiffs’ motion for class certification.

Berger Montague’s team consists of H. Laddie Montague, Jr., Eric L. Cramer, Ruthanne Gordon, Michael C. Dell’Angelo, and Candice J. Enders.

The case is In re Domestic Drywall Antitrust Litigation, case number 2:13-md-02437, in the U.S. District Court for the Eastern District of Pennsylvania.

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