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Polyurethane FoamIn re Polyurethane Foam Antitrust Litigation
MDL No. 2196 (N.D. Ohio) May 2014
Hausfeld LLP was appointed to be on the Executive Committee in this litigation representing a proposed class of direct-purchaser plaintiffs who allege that the country's leading manufacturers of polyurethane foam fixed the prices of polyurethane foam and polyurethane-foam products for well over a decade, resulting in significant overcharges to their customers. Polyurethane foam is a cushioning product used in residential and commercial furnishings, including bedding and flooring, automotive interiors, carpet underlay and in hundreds of industrial, medical, packaging and technical applications. The manufacturer defendants, who account for 80 to 90 percent of U.S. slabstock foam sales and more than 90 percent of carpet underlay sales, are located principally in North Carolina, Virginia, Ohio, and Canada.
On June 21, 2013, the Court granted final approval of settlements with two defendants. The first settlement, with Defendants Vitafoam Inc. and Vitafoam Products Canada Ltd., provides for an initial payment of $5 million, an additional guaranteed payment of at least $4 million, plus a potential recovery of up to $6 million more at the time of a future Vitafoam recovery in a separate multidistrict litigation proceeding. The second settlement, with Defendant Domfoam International, Inc., provides for significant and meaningful cooperation with Plaintiffs in exchange for voluntary dismissal without prejudice of all claims agains the bankrupt corporate Domfoam Defendants and the release of other parties. In April 2014, the Court certified the class.
The litigation against the remaining defendants continues, with a trial date scheduled for October 2014.
In January 2014, the European Commission fined the five major producers of flexible polyurethane foam - Vita, Carpenter, Recticel, Greiner and Eurofoam - a total of €114 million for participating in an unlawful price-fixing cartel. The companies colluded to coordinate the sales prices of flexible polyurethane foam for nearly five years, from October 2005 until July 2010, in ten European Member States: Austria, Belgium, Estonia, France, Germany, Hungary, the Netherlands, Poland, Romania and the UK. The cartelists organized price coordination meetings at all levels of European managmenet met on the margins of European and national associations and had numerous telephnoe and other bilateral contacts. The aim of the cartel was to pass on raw material price increases of bulk chemicals to customers and avoid aggressive price competition between the five producers.
The EC Decision concerned flexible polyurethane foam, which is mainly used in household furniture such as mattresses or sofas. Applications in the automotive sector - in particular for car seats - also account for around a quarter of the total flexible polyurethane foam market in the European Economic Area. To access the Press Release click here. The public decision is forthcoming.
Partnered with co-counsel, Hausfeld LLP represents a proposed class of direct-purchaser plaintiffs who allege that the country’s leading manufacturers of polyurethane foam fixed the prices of polyurethane foam and polyurethane-foam products for well over a decade, resulting in significant overcharges to their customers. Polyurethane foam and polyurethane-foam products are used in various industries, notably bedding, flooring, vehicles, and furniture. The manufacturer defendants are located principally in North Carolina, Virginia, Ohio, and Canada.
For more information, please contact attorneys Megan E. Jones or Seth Gassman in our Washington, DC office.
Practice Areas: Antitrust / Competition