CLASS ACTION COMPLAINT
-1-
UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN
JOSEPH BUDRIUNAS, on behalf of himself and all others similarly situated, Plaintiff, vs. DENSO CORPORATION, and DENSO INTERNATIONAL AMERICA, INC, Defendants.
) ) ) ) ) ) ) ) ) ) ) ) )
Case No. CLASS ACTION COMPLAINT FOR DAMAGES AND INJUNCTIVE RELIEF JURY TRIAL DEMANDED
Joseph Budriunas (“Plaintiff”), on behalf of himself and all those similarly situated,
brings this action to recover damages and to obtain injunctive and other relief pursuant to
federal antitrust laws and state antitrust, unfair competition, and consumer protection laws
against Defendants Denso Corporation, and Denso International America, Inc. (collectively
“Denso” or “Defendants”), which are or were operating in the markets selling automobile parts
to original equipment manufacturers (“OEM”) and suppliers consisting of Heating Control
Panels in the United States between January 2000 and February 2010. Plaintiff demands a trial
by jury and alleges the following on information and belief.
NATURE OF THE ACTION
1. This case arises out of a conspiracy among Defendants and their co-conspirators
with the purpose and effect of fixing prices in the market for Heating Control Panels (as
defined below). During the Class Period (as defined below), and earlier, Defendants
contracted, combined or conspired to fix, raise, maintain and/or stabilize prices and allocate
customers for Heating Control Panels in the United States and globally, the purpose and effect
of which is to maintain supracompetitive prices, by means and mechanisms described herein.
As set forth below, the conspiracy was carried out during meetings and conversations between
and among executives and employees of Defendants and their co-conspirators who have
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 1 of 35 Pg ID 1
CLASS ACTION COMPLAINT
-2-
communicated with one another to fix prices and allocate customers in a massive, decade-long
conspiracy targeted at the United States automotive industry.
2. This case is brought as a class action on behalf of all persons and entities who
purchased Heating Control Panels from firms that purchased Heating Control Panels directly
from one or more of the Defendants or their co-conspirators, during the period from and
including January 2000 up to and including February 2010 (hereinafter, the “Class Period”).
3. As alleged herein, Defendants and other co-conspirators (as yet unknown)
explicitly agreed with each other to charge inflated prices for Heating Control Panels. Price
increases during the Class Period were the result of conspiratorial and anticompetitive
discussions among Defendants and other co-conspirators to fix prices. Defendants and other
co-conspirators also engaged in a combination and conspiracy among themselves to allocate
customers in specific communications between each other.
4. As a direct and proximate result of the unlawful conduct and price-fixing
conspiracy of Defendants and their co-conspirators, as alleged in this Complaint, Plaintiff and
the other members of the Classes (defined below) have paid more during the Class Period for
Heating Control Panels than they otherwise would have paid in a competitive market, and
therefore have suffered injury their businesses and property.
5. Plaintiff has been an indirect purchaser of Heating Control Panels from Denso
during the Class Period. Plaintiff brings this lawsuit as a class action pursuant to Section 16 of
the Clayton Act (15 U.S.C. § 26) to obtain injunctive relief and to recover damages arising
from Defendants’ violations of Section 1 of the Sherman Act (15 U.S.C. § 1). Plaintiff also
asserts claims for actual and exemplary damages pursuant to state antitrust, unfair competition,
and consumer protection laws, and seeks to obtain restitution, recover damages and secure
other relief against Defendants for violation of those state laws. Plaintiff and the Classes also
seek attorneys’ fees, costs, and other expenses under federal and state law.
PLAINTIFF
6. Plaintiff Budriunas is a California resident who purchased a Heating Control
Panel indirectly from one or more of the Defendants and their co-conspirators, and suffered
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 2 of 35 Pg ID 2
CLASS ACTION COMPLAINT
-3-
injury as a result of Defendants’ unlawful conduct.
7. The price Plaintiff paid for his Heating Control Panel was greater than the price
he would have paid in the absence of Defendants’ unlawful conduct alleged herein. Plaintiff
has therefore been injured in his business and property by reason of Defendants’ antitrust
violations. Plaintiff brings this lawsuit as a class action on behalf of himself and all persons
and entities that purchased Heating Control Panels from firms that purchased Heating Control
Panels directly from one or more of the Defendants or their co-conspirators during the Class
Period.
DEFENDANTS
8. Defendant DENSO CORPORATION (“Denso-Japan”) is a Japanese company
with its principal place of business at 1-1, Showa-cho, Kariya, Aichi 448-8661, Japan. Denso-
Japan manufactured, marketed and/or sold Heating Control Panels that were purchased
throughout the United States, including in this district, during the Class Period.
9. Defendant DENSO INTERNATIONAL AMERICA, INC. (“Denso-America”)
is a Delaware company with a principal place of business at 24777 Denso Dr., Southfield,
Michigan 48033. Denso America is a wholly-owned and controlled subsidiary of Denso-Japan.
Denso America manufactured, marketed and/or sold Heating Control Panels that were
purchased throughout the United States, including in this district, during the Class Period.
10. Defendants Denso-Japan and Denso-America and are referred to collectively
herein as “Denso.”
11. To the extent that subsidiaries, divisions and other affiliates within Defendants’
corporate families sold or distributed Heating Control Panels, these related entities played a
material role in the conspiracy alleged in this complaint because Defendants wished to ensure
that the prices paid for such Heating Control Panels would not undercut the artificially raised
and inflated pricing that was the aim and intended result of Defendants’ coordinated and
collusive behavior as alleged herein. Thus, all such entities within the corporate family were
active, knowing participants in the conspiracy alleged herein, and their conduct in selling,
pricing, distributing and collecting monies from Plaintiff and the members of the Classes for
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 3 of 35 Pg ID 3
CLASS ACTION COMPLAINT
-4-
Heating Control Panels was known to and approved by their respective corporate parent named
as a Defendant in this complaint.
AGENTS AND CO-CONSPIRATORS
12. The acts alleged against the Defendants in this Complaint were authorized,
ordered, or done by their officers, agents, employees, or representatives, while actively engaged
in the management and operation of Defendants’ businesses or affairs.
13. Various persons and/or firms not named as defendants herein may have
participated as co-conspirators in the violations alleged herein and may have performed acts
and made statements in furtherance thereof.
14. Each Defendant acted as the principal, agent, or joint venturer of, or for, other
Defendants with respect to the acts, violations, and common course of conduct alleged by
Plaintiff.
JURISDICTION AND VENUE
15. Plaintiff brings this action under Section 16 of the Clayton Act (15 U.S.C. § 26)
to obtain injunctive relief and to recover damages arising from Defendants’ violations of
Section 1 of the Sherman Act (15 U.S.C. § 1). Plaintiff also asserts claims for actual and
exemplary damages pursuant to state antitrust, unfair competition, and consumer protection
laws, and seeks to obtain restitution, recover damages and secure other relief against
Defendants for violation of those state laws. Plaintiff and the Classes also seek attorneys’ fees,
costs, and other expenses under federal and state law.
16. Jurisdiction is conferred upon this District pursuant to Section 16 of the Clayton
Act (15 U.S.C. § 26), Section 1 of the Sherman Act (15 U.S.C. § 1), and 28 U.S.C. §§ 1331 and
1337. This court has subject matter jurisdiction over the state law claims in this action pursuant
to 28 U.S.C. §§ 1332(d) and 1367, as this is a class action in which the matter or controversy
exceeds the sum of $5,000,000, exclusive of interests and costs, and in which some members of
the proposed Classes are citizens of different states than some Defendants.
17. Venue is proper in this District pursuant to Section 12 of the Clayton Act (15
U.S.C. § 22), and pursuant to 28 U.S.C. § 1391(b), (c) and (d), because at all times relevant to
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 4 of 35 Pg ID 4
CLASS ACTION COMPLAINT
-5-
the Complaint, Defendants transacted business, were found, or acted through subsidiaries or
agents present in this District. Additionally, a substantial part of the interstate trade and
commerce involved and affected by the alleged violations of the antitrust laws was and is
carried on in part within this District. The acts complaint of have had, and will have,
substantial anti-competitive effects within this District.
18. This Court has in personam jurisdiction over each of the Defendants because,
inter alia, each of the Defendants: (a) committed acts in furtherance of the conspiracy alleged
herein in this District and directed the unlawful conspiracy through persons and entities located
in this District, including fixing the prices of Heating Control Panels sold to purchasers in this
District; (b) transacted business in Heating Control Panels in this District; (c) maintains and has
maintained continuous and systemic contacts with this District over a period of years; (d)
purposefully availed itself of the benefits of doing business in this District. Accordingly, each
of the Defendants maintains minimum contacts with this District more than sufficient to subject
it to service of process and sufficient to comply with due process of law.
FACTUAL ALLEGATIONS
TIER 1 AUTOMOBILE PARTS
19. The claims within this Complaint arise out of the closed and consolidated nature
of the market for automobile parts. Original equipment manufacturers (“OEMs”), for example
Ford, General Motors Corporation, Toyota Motor Corporation, Honda, and Nissan, do not
design and manufacture most of the parts and sub-systems that are in the modern automobile,
which resembles a computer on wheels. A handful of entities, commonly referred to as Tier 1
suppliers, dominate the market for sub-systems that are installed into vehicles by the OEMs.
20. As explained herein, when the parties agreed to fix the prices for Heating
Control Panels, they also collaborated with some of the same co-conspirators to fix the prices
for other automobile parts, such as electronic control units. As a result of the relationships
developed between Denso and its co-conspirators in fixing the prices for one product, some of
the conspirators agreed to fix the market for similar products as part of the same conspiracy.
21. A Morgan Stanley report in November 2011 estimated the ongoing global probe
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 5 of 35 Pg ID 5
CLASS ACTION COMPLAINT
-6-
“covers several components/end-markets within the auto sector and we believe (it) includes up
to 80 suppliers” in at least five specific industry segments of the auto supply chain.
i.
HEATING CONTROL PANELS
22. Heating Control Panels are located in the center console of an automobile and
control the temperature of the interior environment of a vehicle.
23. Heating Control Panels are installed by automobile original equipment
manufacturers (“OEMs”) in new cars as part of the automotive manufacturing process. They
are also installed in cars to replace worn out, defective or damaged Heating Control Panels.
ii.
THE NATURE OF THE TIER 1 AUTOMOTIVE SUPPLIER INDUSTRY
24. For new cars, OEMs—mostly large automotive manufacturers—purchase
Heating Control Panels directly from Defendants. As part of their supply chain and
procurement process, major OEMs issue Requests for Quotation (“RFQs”) to automotive parts
suppliers on a model-by model basis for model-specific Heating Control Panels.
25. RFQs are a standard business practice that allows automotive parts suppliers to
submit price quotations or bids on specific products or services.
26. Foreign automobile manufacturers participate in RFQs to procure parts for U.S.-
manufactured vehicles both abroad and in the United States.
27. Automobile manufacturers’ RFQs typically include specifications and other
relevant information for each automotive product. In response to RFQs, automotive parts
suppliers submit price quotations, or bids, to automobile manufacturers to be considered for an
award.
28. After receiving RFQs from each respective bidder, automotive manufacturers
then award the business to the selected automotive parts suppliers for its annual requirements or
the lifespan of the vehicle model.
29. Defendants and other automotive parts suppliers submit quotations, or bids, to
OEMs in response to RFQs, and the OEMs usually award the business to the selected
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 6 of 35 Pg ID 6
CLASS ACTION COMPLAINT
-7-
automotive parts supplier for four to six years. Typically, the bidding process begins
approximately three years prior to the start of production of a new model. Japanese OEMs
procure parts for U.S.-manufactured vehicles both in Japan and the United States. Defendants
and their co-conspirators supplied Heating Control Panels to OEMs for installation in vehicles
manufactured and sold in the United States and elsewhere. Defendants and their co-
conspirators manufactured Heating Control Panels (a) in the United States for installation in
vehicles manufactured and sold in the United States, (b) in Japan for export to the United States
and installation in vehicles manufactured and sold in the United States, and (c) in Japan for
installation in vehicles manufactured in Japan for export to and sale in the United States.
iii.
HIGH BARRIERS TO ENTRY
30. In a competitive market, economies of scale and decreasing costs would lead to
lower prices because manufacturers typically will reduce pricing rather than lose market share.
31. In a market subject to a conspiracy to fixed prices, however, competitors do not
have the same incentive to lower prices despite steady or decreasing input costs because based
on a conspiratorial agreement, there is a smaller risk of losing sales to lower-priced
competitors.
32. A collusive arrangement that raises product prices above competitive levels
would, under basic economic principles, attract new entrants seeking to benefit from the supra-
competitive pricing. Where, however, there are significant barriers to entry, new entrants are
less likely. Thus, high barriers to entry help to facilitate the formation and maintenance of a
cartel.
33. There are high barriers to entry into the Heating Control Panels market that
preclude, reduce, or make more difficult entry into the Heating Control Panels market. It is
critically important for parts suppliers to maintain minimum viable scale in order to efficiently
produce parts within the price and quantity parameters established by the major OEMs. As
such, loss of a supplier of choice position could have severe consequences to the business
models of Defendants and their co-conspirators.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 7 of 35 Pg ID 7
CLASS ACTION COMPLAINT
-8-
34. In addition, Denso owns several patents for the component parts that make up
Heating Control Panels. These patents place a significant and costly burden on potential new
market entrants, who must avoid infringing on the patents when entering the Heating Control
Panels market with a new product.
iv.
INELASTIC DEMAND
35. “Elasticity” is a term used to describe the sensitivity of supply and demand to
changes in one or the other. For example, demand is said to be “inelastic” if an increase in the
price of a product results in only a small, decline in the quantity sold of that product, if any. In
other words, customers have nowhere to turn for alternative, cheaper products of similar
quality, and so continue to purchase despite a price increase.
36. For a cartel to profit from raising prices above competitive levels, demand must
be relatively inelastic at competitive prices. Otherwise, increased prices would result in
declining sales, revenues and profits, as customers purchased substitute products or declined to
buy altogether.
37. Demand for Heating Control Panels is relatively inelastic because there are no
close substitutes for these products. In addition, customers must purchase Heating Control
Panels as an essential part of a vehicle, even if the prices are kept at a supracompetitive level.
v.
DEFENDANTS HAD AMPLE OPPORTUNITIES TO CONSPIRE
38. Defendants attended industry events where they had the opportunity to meet
with co-conspirators, have improper discussions under the guise of legitimate business
contacts, and perform acts necessary for the operation and furtherance of the conspiracy. For
example, Defendants have regularly attended the annual Detroit Auto Show, which provided
the means and opportunity to further the conspiracy alleged herein.
vi.
ACTS IN FURTHERANCE OF THE CONSPIRACY
39. During the Class Period, Defendants and their co-conspirators formed an
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 8 of 35 Pg ID 8
CLASS ACTION COMPLAINT
-9-
international cartel to suppress and eliminate competition for Heating Control Panels by
agreeing to rig bids for, and to fix, stabilize, and/or maintain the prices of Heating Control
Panels.
40. Defendants and their co-conspirators participated in meetings, conversations,
and communications in the United States and abroad to discuss bids and price quotations of
Heating Control Panels to be submitted to automobile manufacturers in the United States.
41. Defendants and their co-conspirators agreed during those meetings,
conversations, and communications to allocate the supply of Heating Control Panels sold to
automobile manufacturers in the United States.
42. Defendants and their co-conspirators agreed during those meetings,
conversations, and communications to coordinate price adjustments requested by automobile
manufacturers in the United States.
43. Defendants and their co-conspirators submitted bids, price quotations, and price
adjustments to automobile manufacturers in the United States in accordance with their
conspiratorial agreements.
44. Defendants knew and intended that their pricing actions regarding their sales of
Heating Control Panels to automobile manufacturers would have a direct and correlated impact
on prices for Heating Control Panels for all buyers or purchasers of Heating Control Panels
throughout the United States.
45. Defendants and their co-conspirators held meetings and conversations in the
United States to monitor and police the agreed-upon bid-rigging and price-fixing conspiracy.
46. Defendants and their co-conspirators undertook measures to maintain the
secretive nature of their unlawful conduct, including but not limited to, using code names and
meeting at private residences or remote locations.
vii.
EFFORTS TO ENFORCE THE CONSPIRACY
47. Defendants also undertook efforts to police the conspiracy. Participants
followed up after discussions with competitors to see if the specific price increases and
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 9 of 35 Pg ID 9
CLASS ACTION COMPLAINT
-10-
effective dates were actually being implemented.
viii.
TRADE ASSOCIATIONS AND BUSINESS ORGANIZATIONS
48. Various industry trade organizations or events facilitated Defendants’ illegal
conduct. Representatives of Defendants and their co-conspirators attended industry events that
provided the opportunity to meet, disguise their improper discussions, and perform acts in
furtherance of the conspiracy. For example, Defendants and their co-conspirators have
regularly attended the annual North American International Auto Show (“NAIAS”) in Detroit,
Michigan and the Automotive Aftermarket Products Expo in Las Vegas, Nevada. Indeed,
according to the NAIAS website, Defendant Denso was a premier sponsor of the 2012 event
held from January 9 to January 22.
49. Representatives of Defendants and their co-conspirators disguised their
attendance at these events as information gathering and merely used them as an opportunity to
fix prices and divvy up customers in person.
50. Representatives of Defendants and their co-conspirators not only had no
intention of learning about the market at these meetings, they essentially controlled the market,
and attended these meetings to further demonstrate their control.
ix.
GOVERNMENT INVESTIGATIONS
51. A globally coordinated antitrust investigation has been taking place in the
United States, Europe, and Japan, aimed at Tier 1 suppliers/producers of Heating Control
Panels and other automobile parts.
52. The investigation began in Europe as the result of several European OEMs
joining together to bring a complaint to the European Commission (“EC”). One of the OEMs
failed to attract competitive bids for automotive wire harness systems, leading the company to
join with several other carmakers to take their complaint to the EC.
53. On February 8, 2010, the EC executed surprise raids at the European offices of
several automotive parts makers as part of an investigation into anti-competitive conduct
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 10 of 35 Pg ID 10
CLASS ACTION COMPLAINT
-11-
related to the manufacturing and sale of certain automotive parts. The EC also carried out
additional raids at the European offices of several automotive parts makers on June 7, 2010.
Specifically, EC investigators raided the offices of Leoni AG, S-Y Systems Technologies
Europe GmbH, and Yazaki Corporation (“Yazaki”). An EC official said in a statement that
“[t]he Commission has reason to believe that the companies concerned may have violated
European Union antitrust rules that prohibit cartels and restrictive business practices.”
54. Also in February 2010, the Japanese Fair Trade Commission (“JFTC”) raided
the Tokyo offices of Furukawa Electric Co. (“Furukawa”), Ltd., Sumitomo Electric Industries,
Ltd., and Yazaki as part of an expansive investigation into collusion in the automotive industry
dating back to at least 2003.
55. On July 20, 2011, the JFTC raided seven Japanese auto parts makers, including
Defendant Denso Corporation. The Japan Times reported that the JFTC “suspects the parts
manufacturers had meetings from 2002 or earlier to set parts prices and decided which
companies would win contracts before bidding for orders from automakers.”
56. The United States Department of Justice (“DOJ”) also has been conducting an
investigation of potential antitrust activity and coordinating its investigation with the antitrust
regulators in Europe. “The antitrust division is investigating the possibility of anticompetitive
cartel conduct of automotive electronic component suppliers,” Justice Department
Spokeswoman Gina Talamona said.
57. Indeed, on February 23, 2010, around the same time as the raids by the Japanese
and European competition authorities, investigators from the FBI raided three Detroit-area
Japanese auto parts makers as part of a federal antitrust investigation. The FBI executed
warrants and searched the offices of these companies, including Denso’s subsidiary in
Southfield, Michigan, Denso International America, Inc. Special Agent Sandra Berchtold said
the affidavits supporting issuance of the warrants were sealed in federal court.
58. To obtain search warrants, the United States was legally required to have
probable cause, accepted by a magistrate, to believe that it would obtain evidence of an
antitrust violation as a result of executing the search warrant. In other words, the United States
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 11 of 35 Pg ID 11
CLASS ACTION COMPLAINT
-12-
had to have evidence sufficient to warrant a person of reasonable caution to believe that raiding
the offices of a seemingly lawful business would uncover evidence of antitrust violations, and
that claimed evidence must have been examined and accepted by a magistrate. That belief,
which was recounted in sworn affidavits or testimony, must be grounded on reasonably
trustworthy information.
x.
DENSO GUILTY PLEA
59. The DOJ announced on January 30, 2012, that Denso has agreed to pay a total
of $78 million in criminal fines and plead guilty to a two count criminal information charging
Denso with: (1) participating in a combination and conspiracy with its co-conspirators to
suppress and eliminate competition in the automotive parts industry by agreeing to rig bids for,
and to fix, stabilize, and maintain the prices of Heating Control Panels sold to an automobile
manufacturer in the United States and elsewhere from at least as early as January 2000 and
continuing until at least February 2010 in violation of the Sherman Act, 15 U.S.C. § 1; and (2)
participating in a combination and conspiracy with its co-conspirators to suppress and eliminate
competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize,
and maintain the prices of electronic control units sold to an automobile manufacturer in the
United States and elsewhere from at least as early as January 2000 and continuing until at least
February 2010 in violation of the Sherman Act, 15 U.S.C. § 1.
60. According to the criminal information filed against Denso, Denso and its co-
conspirators carried out the conspiracies by:
(a) Participating in meetings, conversations, and communications in the United
States and Japan to discuss the bids and price quotations to be submitted to certain
automobile manufacturers in the United States and elsewhere;
(b) Agreeing, during those meetings, conversations, and communications, on bids
and price quotations to be submitted to certain automobile manufacturers in the United
States and elsewhere;
(c) Agreeing, during those meetings, conversations, and communications, to
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 12 of 35 Pg ID 12
CLASS ACTION COMPLAINT
-13-
allocate the supply of Heating Control Panels sold to certain automobile manufacturers
in the United States and elsewhere on a model-by-model basis;
(d) Agreeing, during those meetings, conversations, and communications, to
coordinate price adjustments requested by certain automobile manufacturers in the
United States and elsewhere;
(e) Submitting bids, price quotations, and price adjustments to certain automobile
manufacturers in the United States and elsewhere in accordance with the agreements
reached;
(f) Selling Heating Control Panels to certain automobile manufacturers in the
United States and elsewhere at collusive and noncompetitive prices;
(g) Accepting payment for Heating Control Panels sold to certain automobile
manufacturers in the United States and elsewhere at collusive and noncompetitive
prices;
(h) Engaging in meetings, conversations, and communications in the United States
and elsewhere for the purpose of monitoring and enforcing adherence to the agreed-
upon bid-rigging and price-fixing scheme; and
(i) Employing measures to keep their conduct secret, including but not limited to
using code names and meeting at private residences or remote locations.
61. The plea agreement was an outgrowth of the DOJ’s initial charges in its ongoing
international cartel investigation of price-fixing and bid rigging in the automotive parts
industry.
xi.
OTHER GUILTY PLEAS IN THE AUTOMOTIVE PARTS INDUSTRY
62. In addition to the Denso guilty plea, other automotive parts makers and
individuals have entered into plea agreements relating to their participation in conspiracies to
fix prices and rig bids for automotive parts.
63. On January 30, 2012, the DOJ announced that Yazaki had agreed to pay a $470
million criminal fine, the second largest criminal fine obtained for a Sherman Act antitrust
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 13 of 35 Pg ID 13
CLASS ACTION COMPLAINT
-14-
violation, and plead guilty to a three count criminal information charging Yazaki with: (1)
participating in a combination and conspiracy with its co-conspirators to suppress and eliminate
competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize,
and maintain the prices of, automotive wire harnesses and related products sold to certain
automobile manufacturers in the United States and elsewhere from at least as early as January
2000 and continuing until at least February 2010 in violation of the Sherman Act, 15 U.S.C. § 1
(2) participating in a combination and conspiracy with its co-conspirators to suppress and
eliminate competition in the automotive parts industry by agreeing to rig bids for, and to fix,
stabilize, and maintain the prices of, instrument panel clusters sold to certain automobile
manufacturers in the United States and elsewhere from at least as early as December 2002 and
continuing until at least February 2010 in violation of the Sherman Act, 15 U.S.C. § 1; and (3)
participating in a combination and conspiracy with its co-conspirators to suppress and eliminate
competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize,
and maintain the prices of, fuel senders sold to an automobile manufacturer in the United States
and elsewhere from at least as early as March 2004 and continuing until at least February 2010
in violation of the Sherman Act, 15 U.S.C. § 1.
64. Four executives from Yazaki (all Japanese nationals) – Tsuneaki Hanamura,
Ryoji Kuwai, Shigeru Ogawa, and Hisamitsu Takada – also have pleaded guilty to their
participation in a conspiracy to suppress and eliminate competition in the automotive parts
industry by agreeing to rig bids for, and to fix, stabilize, and maintain the prices of automotive
wire harnesses sold to certain automobile manufacturers in the United States and elsewhere in
violation of the Sherman Act, 15 U.S.C. § 1. These four executives of Yazaki will serve prison
time ranging from 15 months to two years. The two-year sentences would be the longest term
of imprisonment imposed on a foreign national voluntarily submitting to U.S. jurisdiction for a
Sherman Act antitrust violation.
65. On September 29, 2011, the DOJ announced that Furukawa had agreed to plead
guilty and to pay a $200 million fine for its role in a criminal price-fixing and bid-rigging
conspiracy involving the sale of automotive wire harnesses and related products to automobile
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 14 of 35 Pg ID 14
CLASS ACTION COMPLAINT
-15-
manufacturers. Three executives, who are Japanese nationals, also agreed to plead guilty and
to serve prison time in the United States ranging from a year and a day to 18 months.
66. “As a result of this international price-fixing and bid-rigging conspiracy,
automobile manufacturers paid noncompetitive and higher prices for parts in cars sold to U.S.
consumers,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the
Department of Justice’s Antitrust Division. “This cartel harmed an important industry in our
nation’s economy, and the Antitrust Division with the Federal Bureau of Investigation will
continue to work together to ensure that these kinds of conspiracies are stopped.”
67. FBI Special Agent in Charge Andrew G. Arena also said that “[w]hen
companies partner to control and price fix bids or contracts, it undermines the foundation of the
United States’ economic system. . . . The FBI is committed to aggressively pursuing any
company involved in antitrust crimes.”
68. According to the plea agreements, Furukawa and its three executives have all
agreed to assist the DOJ in its ongoing investigation into the automotive parts industry.
69. Pursuant to Furukawa’s plea agreement, the government agreed not to bring
criminal charges against any other current or former director, officer or employee involved in
an antitrust conspiracy surrounding the manufacture and sale of automotive wire harnesses and
related products, with the exception of Shuji Hayashida, Chief Executive Officer of Furukawa
America. According to the Michigan Department of Licensing and Regulatory Affairs,
Hayashida served as Furukawa America’s Chief Executive Officer from 2001 to 2010. To
date, no charges have been filed against Hayashida.
70. On the basis of the foregoing charges, guilty pleas and market structure, on
behalf of themselves and the members of the Classes, Plaintiff adopts and incorporates such
allegations with respect to the totality of the Heating Control Panels market as alleged herein.
ACCRUAL OF CLAIM, CONTINUING VIOLATION,
EQUITABLE TOLLING, AND FRAUDULENT CONCEALMENT
71. Plaintiff did not discover and could not discover through the exercise of
reasonable diligence the existence of the conspiracy alleged herein prior to disclosure of
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 15 of 35 Pg ID 15
CLASS ACTION COMPLAINT
-16-
Denso’ cooperation with the DOJ.
72. Defendants and their co-conspirators have committed continuing violations of
the antitrust laws resulting in monetary injury to Plaintiff and members of the Classes. These
violations constitute injurious acts which restart the applicable statute of limitations
73. In addition, Defendants’ and their co-conspirators’ agreement, understanding
and conspiracy in violation of the antitrust laws was kept secret. As a result, Plaintiff and the
members of the Classes were unaware of Defendants’ unlawful conduct alleged herein and did
not know that they were paying artificially high prices for Heating Control Panels throughout
the United States throughout the Class Period. Defendants and their co-conspirators
affirmatively and fraudulently concealed their unlawful conduct.
74. Plaintiff and the members of the Classes did not discover, nor could have
discovered through reasonable diligence, that Defendants and their co-conspirators were
violating the antitrust laws until shortly before this litigation was initially commenced, because
Defendants and their co-conspirators used deceptive and secret methods to avoid detection and
to affirmatively conceal their violations.
75. Neither Defendants nor their co-conspirators told Plaintiff or other members of
the Classes that they were fixing prices and allocating customers, or engaging in the other
unlawful collusive practices alleged herein. By its very nature, Defendants’ and their co-
conspirators’ conspiracy was inherently self-concealing.
76. Defendants and their co-conspirators engaged in a successful price-fixing and
customer allocation conspiracy, which they affirmatively concealed:
a. by meeting secretly (including use of private telephonic
communications) to discuss prices, customers, and markets of Heating Control Panels
sold in the United States and elsewhere;
b. by agreeing among themselves at meetings and in communications not to
discuss publicly, or otherwise reveal, the nature and substance of the acts and
communications in furtherance of their illegal scheme;
c. by holding secret meetings outside and separate from the formal trade
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 16 of 35 Pg ID 16
CLASS ACTION COMPLAINT
-17-
association meetings Defendants were publicly attending; and
d. by disguising price-fixing meetings and communications as technical and
operational meetings.
ANTITRUST INJURY
77. The unlawful contract, combination and/or conspiracy alleged above had and is
having, inter alia, the following effects:
a. Prices charged by Defendants and their co-conspirators to Plaintiff and
the members of Classes for Heating Control Panels were maintained at artificially high
and supracompetitive levels;
b. Plaintiff and members of the Classes were required to pay more for
Heating Control Panels than they would have paid in a competitive marketplace
unfettered by Defendants’ and their co-conspirators’ collusive and unlawful price-
fixing; and
c. Plaintiff and members of the Classes have been deprived of the benefits
of free, open and unrestricted competition in the market for Heating Control Panels.
78. During and throughout the period of the contract, combination or conspiracy
alleged above, Plaintiff and members of the Classes paid supracompetitive prices for Heating
Control Panels in the United States.
79. The market for Heating Control Panels and the market for vehicles are
inextricably linked and intertwined because the market for Heating Control Panels exists to
serve the automotive market. Without the vehicles, Heating Control Panels have little to no
value because they have no independent utility.
80. Heating Control Panels are identifiable, discrete physical products that Plaintiff
and members of the Classes purchased. As a result, Heating Control Panels follow a traceable
physical chain of distribution from the Defendants to Plaintiff and the members of the Classes,
and any costs attributable to Heating Control Panels can be traced through the chain of
distribution to Plaintiff and the members of the Classes.
81. Plaintiff and the other members of the Classes paid more for the Heating Control
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 17 of 35 Pg ID 17
CLASS ACTION COMPLAINT
-18-
Panels than they would have paid under conditions of free and open competition.
82. As a direct and proximate result of the illegal combination, contract or
conspiracy alleged above, Plaintiff and the members of the Classes were injured and financially
damaged in their businesses and property, in amounts that are not presently determined.
83. This is antitrust injury of the type that the antitrust laws were meant to punish
and prevent.
CLASS ACTION ALLEGATIONS
84. Plaintiff incorporates by reference as if fully set forth herein the allegations
contained in the preceding paragraphs of this Complaint.
85. Plaintiff brings this action on his own behalf and as a class action pursuant to
Federal Rules of Civil Procedure 23(a) and (b)(2), seeking equitable and injunctive relief on
behalf of the following Class (the “Nationwide Class”):
All persons and entities that indirectly purchased, during the Class Period,
Heating Control Panels, for personal use and not for resale, including as a stand-
alone replacement product or as a component of a new or leased motor vehicle
from any Defendant or any current or former subsidiary or affiliate thereof, or
any co-conspirator.
86. Plaintiff also brings this action on its own behalf and as a class action pursuant
to Federal Rules of Civil Procedure 23(a) and (b)(3), seeking damages pursuant to the state
antitrust, unfair competition, and consumer protections laws on behalf of the following Class
(the “Damages Class”):
All persons and entities that indirectly purchased, during the Class Period, in
states (as listed herein) having indirect purchaser laws, Heating Control Panels,
for personal use and not for resale, including as a stand-alone replacement
product or as a component of a new or leased motor vehicle from any Defendant
or any current or former subsidiary or affiliate thereof, or any co-conspirator.
87. Alternatively, Plaintiff brings Damages Classes on behalf of all persons
similarly situated pursuant to Rule 23 of the Federal Rules of Civil Procedure and/or respective
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 18 of 35 Pg ID 18
CLASS ACTION COMPLAINT
-19-
state statute(s), on behalf of all members of the following classes (collectively, the “State
Classes”), referred to together with the Damages Class as the “Damages Classes”:
a. Arizona: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
b. Arkansas: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
c. California: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
d. District of Columbia: All persons and entities that indirectly purchased, during
the Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
e. Florida: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
f. Hawaii: All persons and entities that indirectly purchased, during the Class
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 19 of 35 Pg ID 19
CLASS ACTION COMPLAINT
-20-
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
g. Illinois: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
h. Iowa: All persons and entities that indirectly purchased, during the Class Period,
Heating Control Panels, for personal use and not for resale, including as a stand-
alone replacement product or as a component of a new or leased motor vehicle
from any Defendant or any current or former subsidiary or affiliate thereof, or
any co-conspirator.
i. Kansas: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
j. Maine: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
k. Massachusetts: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 20 of 35 Pg ID 20
CLASS ACTION COMPLAINT
-21-
affiliate thereof, or any co-conspirator.
l. Michigan: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
m. Minnesota: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
n. Mississippi: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
o. Montana: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
p. Nebraska: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
q. Nevada: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 21 of 35 Pg ID 21
CLASS ACTION COMPLAINT
-22-
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
r. New Hampshire: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
s. New Mexico: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
t. New York: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
u. North Carolina: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
v. North Dakota: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 22 of 35 Pg ID 22
CLASS ACTION COMPLAINT
-23-
w. Oregon: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
x. South Carolina: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
y. South Dakota: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
z. Tennessee: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
aa. Utah: All persons and entities that indirectly purchased, during the Class Period,
Heating Control Panels, for personal use and not for resale, including as a stand-
alone replacement product or as a component of a new or leased motor vehicle
from any Defendant or any current or former subsidiary or affiliate thereof, or
any co-conspirator.
bb. Vermont: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 23 of 35 Pg ID 23
CLASS ACTION COMPLAINT
-24-
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
cc. West Virginia: All persons and entities that indirectly purchased, during the
Class Period, Heating Control Panels, for personal use and not for resale,
including as a stand-alone replacement product or as a component of a new or
leased motor vehicle from any Defendant or any current or former subsidiary or
affiliate thereof, or any co-conspirator.
dd. Wisconsin: All persons and entities that indirectly purchased, during the Class
Period, Heating Control Panels, for personal use and not for resale, including as
a stand-alone replacement product or as a component of a new or leased motor
vehicle from any Defendant or any current or former subsidiary or affiliate
thereof, or any co-conspirator.
88. The Nationwide Classes and the Damages Classes are referred to herein as the
“Classes.” Excluded from the Classes are Defendants, their parent companies, subsidiaries and
affiliates, any co-conspirators, federal governmental entities and instrumentalities of the federal
government, states and their subdivisions, agencies and instrumentalities, and persons who
purchased Heating Control Panels directly from Defendants.
89. The precise number of members of the Classes is unknown to Plaintiff.
However, due to the nature of the trade and commerce involved, Plaintiff is informed and
believes, and thereon alleges, that there are at least thousands of members in each Class.
90. The Classes are each so numerous and geographically dispersed that joinder of
all members is impracticable.
91. There are questions of law and fact common to the all members of the Classes.
These common questions relate to the existence of the conspiracy alleged, and to the type and
common pattern of injury sustained as a result thereof. The questions include, but are not
limited to:
a. Whether Defendants and their co-conspirators engaged in a combination
and conspiracy among themselves to fix, raise, maintain and/or stabilize the price
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 24 of 35 Pg ID 24
CLASS ACTION COMPLAINT
-25-
charged for Heating Control Panels sold in the United States;
b. The identity of participants in the conspiracy;
c. The duration of the conspiracy alleged in this Complaint and the nature
and character of the acts performed by Defendants and their co-conspirators in the
furtherance of the conspiracy;
d. Whether the alleged conspiracy violated Section 1 of the Sherman Act;
e. Whether alleged conspiracy violated state antitrust and unfair
competition laws;
f. Whether Defendants unjustly enriched themselves to the detriment of the
Plaintiff and the members of the Classes, thereby entitling Plaintiff and the members of
the Damages Classes to disgorgement of all benefits derived by Defendants;
g. Whether the conduct of Defendants and their co-conspirators, as alleged
in this Complaint, caused injury to the business and property of Plaintiff and other
members of the Classes;
h. The effect of Defendants’ conspiracy on the prices of Heating Control
Panels in the United States during the Class Period;
i. Whether the Defendants and their co-conspirators fraudulently concealed
the conspiracy’s existence from the Plaintiff and the members of the Classes;
j. The appropriate nature of injunctive and related equitable relief for the
Nationwide Classes; and
k. The appropriate class-wide measure of damages for the Damages
Classes.
92. Plaintiff’s claims are typical of the claims of other members of the Classes, and
Plaintiff will fairly and adequately protect the interests of the members of the Classes. Plaintiff
and all members of the Classes are similarly affected by Defendants’ wrongful conduct in that
they paid artificially inflated prices for Heating Control Panels purchased from firms who
purchased Heating Control Panels from one or more Defendants and/or their co-conspirators.
Plaintiff’s interests are aligned with, and not antagonistic to, those of the other members of the
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 25 of 35 Pg ID 25
CLASS ACTION COMPLAINT
-26-
Classes. In addition, Plaintiff is represented by competent counsel experienced in the
prosecution of class action antitrust litigation.
93. The prosecution of separate actions by individual members of the Classes would
create a risk of inconsistent or varying adjudications, establishing incompatible standards of
conduct for Defendants.
94. The questions of law and fact common to the members of the Classes
predominate over any questions affecting only individual members, including legal and factual
issues relating to liability and damages.
95. Class action treatment is a superior method for the fair and efficient adjudication
of this controversy because:
a. It will avoid a multiplicity of suits and consequent burden on the courts
and Defendants;
b. It would be virtually impossible for all members of the Classes to
intervene as parties-plaintiff in this action;
c. It will allow numerous individuals with claims too small to adjudicate on
an individual basis because of the prohibitive cost of this litigation, to obtain redress for
their economic injuries;
d. The prosecution of separate actions by individual Class members would
create the risk of inconsistent or varying adjudications, establishing incompatible
standards of conduct for Defendants; and
e. It will provide court oversight of the claims process, once Defendants’
liability is adjudicated.
96. This class action presents no difficulties of management that would preclude its
maintenance as a class action.
INTERSTATE TRADE AND COMMERCE
97. The conduct of Defendants and their co-conspirators has taken place in, and
affected the continuous flow of interstate trade and commerce of the United States, in that, inter
alia:
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 26 of 35 Pg ID 26
CLASS ACTION COMPLAINT
-27-
a. Defendants and their co-conspirators have sold Heating Control Panels
throughout the United States;
b. Defendants and their co-conspirators have each used instrumentalities of
interstate commerce to sell Heating Control Panels throughout the United States;
c. In furtherance of the conspiracy alleged herein, Defendants have traveled
between states and have exchanged communications through interstate wire
communications and via U.S. mail; and
d. The conspiracy alleged herein has affected billions of dollars of
commerce. Defendants and their co-conspirators have inflicted antitrust injury by
artificially raising prices paid by Plaintiff and other entities who are themselves engaged
in commerce.
CLAIM FOR RELIEF/CAUSES OF ACTION
Count I
Violation of Section 1 of the Sherman Act
(on behalf of Plaintiff and the Nationwide Classes)
98. Plaintiff incorporates by reference as if fully set forth herein the allegations
contained in the preceding paragraphs of this Complaint.
99. Beginning at a time presently unknown to Plaintiff, but at least as early as
January 2000 and continuing through at least February 2010, Defendants and their co-
conspirators entered into a continuing agreement, understanding, and conspiracy in restraint of
trade in violations of Section 1 of the Sherman Act, 15 U.S.C. § 1.
100. In furtherance of the unlawful conspiracy, each of the Defendants and their co-
conspirators has committed overt acts, including, inter alia:
a. agreeing to charge prices at certain levels and otherwise to fix, increase,
maintain and/or stabilize prices of Heating Control Panels sold in the United States;
b. participating in meetings, conversations, and communications with co-
conspirators regarding prices to be charged for Heating Control Panels;
c. agreeing to allocate customers;
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 27 of 35 Pg ID 27
CLASS ACTION COMPLAINT
-28-
d. meeting with co-conspirators in order to keep the existence of the
conspiracy unknown as to foster the illegal anti-competitive conduct described herein;
and
e. refraining from competing by refusing to offer Heating Control Panels at
prices below the agreed-upon fixed price.
101. The combination and conspiracy alleged herein has had the following effects,
among others:
a. Price competition in the sale of Heating Control Panels has been
restrained, suppressed, and/or eliminated;
b. Prices for Heating Control Panels sold by Defendants and their co-
conspirators have been fixed, raised, maintained and stabilized at artificially high, non-
competitive levels; and
c. Plaintiff and members of the Nationwide Class have been deprived of the
benefits of free, open and unrestricted competition in the market for Heating Control
Panels.
102. Defendants and their co-conspirators engaged in the activities described above
for the purpose of effectuating unlawful arrangements to fix, maintain, raise and/or stabilize
prices of Heating Control Panels.
103. The conduct of Defendants and their co-conspirators constitutes a per se
violation of Section 1 of the Sherman Act, 15 U.S.C. § 1.
104. Plaintiff and members of the Nationwide Class are entitled to an injunction
against Defendants, pursuant to 15 U.S.C. § 26, preventing and restraining the violations
alleged herein.
Count II
Violation of State Antitrust and Consumer Protection Statutes
(on behalf of Plaintiff and the Damages Classes)
105. Plaintiff incorporates by reference as if fully set forth herein the allegations
contained in the preceding paragraphs of this Complaint.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 28 of 35 Pg ID 28
CLASS ACTION COMPLAINT
-29-
106. Beginning at a time presently unknown to Plaintiff, but at least as early as
January 2000 and continuing through at least February 2010, Defendants and their co-
conspirators engaged in a continuing contract, combination or conspiracy with respect to the
sale of Heating Control Panels in an unreasonable restraint of trade and commerce and in
violation of the various state antitrust and other statutes set forth below.
107. The contract, combination, or conspiracy consisted of an agreement among the
Defendants and their co-conspirators to fix, raise, inflate, stabilize, and/or maintain artificially
supracompetitive prices for Heating Control Panels and to allocate customers for Heating
Control Panels in the United States.
108. In formulating and effectuating this conspiracy, Defendants and their co-
conspirators performed acts in furtherance of the combination and conspiracy, including:
a. Participating in meetings and conversations among themselves during which
they agreed to price Heating Control Panels at certain levels and otherwise to fix,
increase, inflate, maintain, or stabilize effective prices paid by Plaintiff and members of
the Damages Classes with respect to Heating Control Panels sold in the United States;
b. Allocating customers and markets and rigging bids for Heating Control Panels
in the United States in furtherance of their agreements; and
c. Participating in meetings and conversations among themselves to implement,
adhere to and police the unlawful agreements they reached.
109. Defendants and their co-conspirators engaged in the actions described above for
the purpose of carrying out their unlawful agreements to fix, maintain, decrease, or stabilize
prices, to rig bids and to allocate customers with respect to Heating Control Panels.
110. Defendants' anticompetitive acts described above were knowing, willful and
constitute violations or flagrant violations of the below-listed state antitrust and consumer
protection statutes.
111. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Arizona Revised Statutes, §§ 44-1401, et seq.
112. Defendants have entered into an unlawful agreement in restraint of trade in
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 29 of 35 Pg ID 29
CLASS ACTION COMPLAINT
-30-
violation of the Arkansas Code Annotated, § 4-88-107(a)(10).
113. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the California Business and Professions Code, §§ 16700, et seq. and §§ 17200 et
seq.
114. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the District of Columbia Code Annotated §§ 284501, et seq.
115. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. §§ 501.201, et seq.
116. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Hawaii Revised Statutes Annotated §§ 480-1, et seq.
117. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Illinois Antitrust Act, 740 Illinois Compiled Statutes 1011, et seq.
118. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Iowa Code §§ 553.1, et seq.
119. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Kansas Statutes Annotated, §§ 50-10 1, et seq.
120. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Maine Revised Statutes, 10 M.R.S. §§ 1101, et seq.
121. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Massachusetts Gen. Laws, Ch 93 A, § II.
122. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Michigan Compiled Laws Annotated §§ 445.771, et seq.
123. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Minnesota Annotated Statutes §§ 325D.49, et seq.
124. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Mississippi Code Annotated §§ 75-21-1, et seq.
125. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Montana Unfair Trade Practices and Consumer Protection Act of 1970, Mont.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 30 of 35 Pg ID 30
CLASS ACTION COMPLAINT
-31-
Code, §§ 30-14-103, et seq.
126. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Nebraska Revised Statutes §§ 59-801, et seq.
127. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Nevada Revised Statutes Annotated §§ 598A.010, et seq.
128. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the New Hampshire Revised Statutes §§ 356:1, et seq.
129. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the New Mexico Statutes Annotated §§ 57-1-1, et seq.
130. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the New York General Business Laws §§ 340, et seq.
131. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the North Carolina General Statutes §§ 75-1, et seq.
132. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the North Dakota Century Code §§ 51-08.1-01, et seq.
133. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Oregon Revised Statutes §§ 646.705, et seq.
134. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the South Carolina Unfair Trade Practices Act, S.C. Code Ann. §§ 39-5-10, et seq.
135. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the South Dakota Codified Laws §§ 37-1-3.1, et seq.
136. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Tennessee Code Annotated §§ 47-25-101, et seq.
137. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Utah Code Annotated §§ 76-10-911, et seq.
138. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Vermont Statutes Annotated §§ 2453, et seq.
139. Defendants have entered into an unlawful agreement in restraint of trade in
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 31 of 35 Pg ID 31
CLASS ACTION COMPLAINT
-32-
violation of the West Virginia Code §§ 47-18-1, et seq.
140. Defendants have entered into an unlawful agreement in restraint of trade in
violation of the Wisconsin Statutes §§ 133.01, et seq.
141. Plaintiff and members of the Damages Classes in each of the above states have
been injured in their business and property by reason of Defendants’ unlawful combination,
contract, conspiracy and agreement. Plaintiff and members of the Damages Classes have paid
more for Heating Control Panels than they otherwise would have paid in the absence of
Defendants’ unlawful conduct. This injury is of the type the antitrust laws of the above states
were designed to prevent and flows from Defendants’ unlawful conduct.
142. Defendants’ violations of the above-listed state laws have proximately caused
the injuries sustained by Plaintiff and the members of the Damages Classes.
143. In addition, Defendants have profited significantly from the aforesaid
conspiracy. Defendants’ profits derived from their anticompetitive conduct come at the
expense and detriment of Plaintiff and the members of the Damages Classes.
144. Accordingly, Plaintiff and the members of the Damages Classes in each of the
above jurisdictions seek damages (including statutory damages where applicable), to be trebled
or otherwise increased as permitted by a particular jurisdiction's antitrust or consumer
protection law, and costs of suit, including reasonable attorneys' fees, to the extent permitted by
the above state laws.
Count III
Unjust Enrichment
(on behalf of Plaintiff and the Damages Classes)
145. Plaintiff incorporates by reference as if fully set forth herein the allegations
contained in the preceding paragraphs of this Complaint.
146. As a result of their unlawful conduct described above, Defendants have been
and will continue to be unjustly enriched. Defendants have been unjustly enriched by the
receipt of, at a minimum, unlawfully inflated prices and unlawful profits on sales of Heating
Control Panels.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 32 of 35 Pg ID 32
CLASS ACTION COMPLAINT
-33-
147. Defendants have benefited from their unlawful acts, at the expense of Plaintiff
and the Damages Classes, and it would be inequitable for Defendants to be permitted to retain
any of the ill-gotten gains resulting from the overpayments made by Plaintiff or the members of
the Damages Classes for Heating Control Panels. The amounts of such overpayments lawfully
belong to Plaintiff and the Damages Classes.
148. Plaintiff and the members of the Damages Classes are entitled to the amount of
Defendants’ ill-gotten gains resulting from their unlawful, unjust and inequitable conduct.
Plaintiff and the members of the Damages Classes are entitled to the establishment of a
constructive trust consisting of all ill-gotten gains from which Plaintiff and the members of the
Damages Classes may make claims on a pro rata basis.
PETITION FOR RELIEF
WHEREFORE, Plaintiff petitions that:
A. The Court determine that this action may be maintained as a class action under
Rule 23 of the Federal Rules of Civil Procedure, that Plaintiff be appointed class
representative and that Plaintiff’s counsel be appointed as counsel for the Classes, and
direct that reasonable notice of this action, as provided by Rule 23(c)(2) of the Federal
Rules of Civil Procedure, be given to each and every member of the Classes.
B. That the unlawful conduct, contract, conspiracy or combination alleged herein
be adjudged and decreed:
a. An unreasonable restraint of trade or commerce in violation of Section 1 of the
Sherman Act;
b. A per se violation of Section 1 of the Sherman Act;
c. An unlawful combination, trust, agreement, understanding and/or concert of
action in violation of the state antitrust and unfair competition and consumer
protection laws as set forth herein; and
d. Acts of unjust enrichment by Defendants as set forth herein.
C. Plaintiff and the members of the Damages Classes recover damages, to the
maximum extent allowed under such laws, and that a joint and several judgment in
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 33 of 35 Pg ID 33
CLASS ACTION COMPLAINT
-34-
favor of Plaintiff and the members of the Damages Classes be entered against
Defendants in an amount to be trebled to the extent such laws permit;
D. Plaintiff and the members of the Damages Classes recover damages, to the
maximum extent allowed by such laws, in the form of restitution and/or disgorgement
of profits unlawfully gained from them;
E. Each of the Defendants, successors, assigns, parents, subsidiaries, affiliates and
transferees, and their respective officers, directors, agents and representatives, and all
other persons acting or claiming to act on behalf of Defendants or in concert with them,
be permanently enjoined and restrained from, in any manner, directly or indirectly,
continuing, maintaining or renewing the combinations, conspiracy, agreement,
understanding or concert of action as alleged herein;
F. Plaintiff and the members of the Damages Classes be awarded restitution,
including disgorgement of profits Defendants obtained as a result of their acts of unfair
competition and acts of unjust enrichment;
G. Plaintiff and the members of the Classes be awarded pre- and post- judgment
interest as provided by law, and that such interest be awarded at the highest legal rate
from and after the date of service of this Complaint;
H. Plaintiff and the members of the Classes recover their costs of suit, including
reasonable attorneys' fees, as provided by law; and
I. The Court award Plaintiff and members of the Classes such other, further and
different relief as may be necessary and appropriate.
JURY DEMAND
Pursuant to Rule 38(a) of the Federal Rules of Civil Procedure, Plaintiff demands a trial
by jury trial of all claims asserted in this Complaint so triable.
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 34 of 35 Pg ID 34
CLASS ACTION COMPLAINT
-35-
Dated: March 12, 2012 STRANGE & CARPENTER
___/s/________________________ Brian R. Strange
STRANGE & CARPENTER BRIAN R. STRANGE 12100 Wilshire Blvd., Suite 1900 Los Angeles, California 90025 Telephone: (310) 207-5055 Facsimile: (310) 826-3210 [email protected] HILBORN & HILBORN, P.C. CRAIG HILBORN (Mi. Bar. No. P43661) GEORGE HILBORN (Mi. Bar. No. P14955) 999 Haynes Street, Suite 205 Birmingham, Michigan 48009 Telephone: (248) 642-8350 Facsimile: (248) 642-3016 [email protected] [email protected] CARPENTER, ZUCKERMAN & ROWLEY, LLP PAUL S. ZUCKERMAN 8827 West Olympic Blvd. Beverly Hills, California 90211 Telephone: (310) 273-1230 Facsimile: (310) 858-1063 [email protected] NEWMAN | DU WORS LLP DEREK A. NEWMAN 1201 Third Avenue, Suite 1600 Seattle, Washington 98101 Telephone: (206) 274-2800 Facsimile: (206) 274-2801 [email protected] Attorneys for Plaintiff and all others similarly situated
5:12-cv-11106-JCO-LJM Doc # 1 Filed 03/13/12 Pg 35 of 35 Pg ID 35