Sony, Others Belong In Battery Price-Fixing Suit, Court Told

Purchaser plaintiffs in multidistrict litigation accusing Sony Corp. and a slew of electronics companies of conspiring to fix the prices of cylindrical lithium-ion batteries urged a California federal judge not to dismiss defendants from the case, saying the complaints are sufficiently pled to go forward.

In three joint opposition motions filed Wednesday, direct and indirect purchaser plaintiffs asked the court to reject motions to dismiss filed by Sony, Panasonic Corp., Sanyo North America Corp. and LG Chem America Inc.

In the Sony case, the direct and indirect purchasers say they have have plausibly alleged the company’s involvement in the conspiracy, and said company subsidiaries are also implicated in the scheme.

“Sony ignores plaintiffs’ factual allegations that Sony conspired to fix lithium-ion battery prices and that Sony’s corporate entities acted on behalf of one another in a unitary fashion in service of the conspiracy,” the motion said.

Sony had asked the court to toss the suit in September, pointing to its drop in sales during the conspiracy period — with its share of the market dwindling from 21 to 8 percent — as contradicting the idea that it was involved in a plot that somehow harmed competition.

But the plaintiffs said that it was premature to consider Sony’s drop in market share.

“Further, Sony’s argument that its market share decline ‘undermines [plaintiffs’] conspiracy allegations’ wrongly asks the court to assume facts and draw inferences in its favor — contrary to what the law requires in evaluating a complaint,” the plaintiffs added.

In another motion, the plaintiffs argue that contrary to Panasonic and Sanyo’s contention, they are not required to detail allegations of secret meetings or communications as to every single subsidiary of a conspiring business.

“The law does not require allegations as to every single subsidiary of a conspiring business where plaintiffs allege that defendants’ various corporate entities acted on behalf of one another in a unitary fashion in service of the conspiracy,” the plaintiffs said.

A third response argued that LG Chem America Inc.’s motion to dismiss should be denied because the complaint does sufficiently allege the company’s contribution to the conspiracy.

“A complaint alleging an international price-fixing conspiracy involving affiliated corporations will not be dismissed just because some allegations refer to a corporate family by a single name,” the plaintiffs said.

The direct and indirect purchasers allege that the defendants were among 18 electronics companies involved in a cartel that conspired to set or maintain artificially high prices for lithium-ion batteries used in various consumer electronics products.

The companies or their subsidiaries allegedly make and market the batteries — which can be recharged and are commonly used in a variety of electronics, from cellphones and laptops to power tools and digital cameras — in the U.S., according to the buyers.

The indirect purchasers, whose suits were eventually rolled into the MDL, allege that during the end of 2001 and beginning of 2002, as Japanese companies such as Sony and Panasonic began facing rising competition from LG and Samsung and as the prices of the batteries declined, the companies illegally conspired to stabilize and increase prices.

The plaintiffs are represented by Pearson Simon & Warshaw LLPSaveri & Saveri Inc., Berman DeValerioZelle Hofmann Voelbel & Mason LLPBerger & Montague PC, Bonsignore & Brewer and others.

Sony is represented by Stephen C. Neal, John C. Dwyer, Bennett S. Miller, Beatriz Mejia, and Scott D. Joiner of Cooley LLP.

Panasonic and Sanyo are represented by Jeffrey L. Kessler, A. Paul Victor , Eva W. Cole, Jeffrey J. Amato, Erica C. Smilevski and Ian L. Papendick of Winston & Strawn LLP and Roxann E. Henry of Morrison & Foerster LLP.

LG is represented by Kenneth P. Ewing, Robert W. Fleishman and Andrew J. Sloniewsky of Steptoe & Johnson LLP.

The case is In Re: Lithium-Ion Batteries Antitrust Litigation, case number 4:13-md-2420, in the U.S. District Court for the Northern District of California.

–Additional reporting by Dan Prochilo. Editing by Katherine Rautenberg.For a reprint of this article, please contact [email protected].

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