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A federal judge has certified a class action antitrust suit against Mercedes-Benz USA and a group of Mercedes dealerships in the vicinity of New York City — including southern New York, northern New Jersey and western Connecticut — brought by consumers who say the manufacturer assisted the dealers in conspiring to fix prices over a seven-year stretch. In his 34-page opinion in Re: Mercedes-Benz Antitrust Litigation, U.S. District Judge Alfred M. Wolin in New Jersey rejected the defendants’ argument that automobile purchasing is so complex that none of the plaintiffs can truly claim to be representative of the entire class. Instead, Wolin found that since all of the plaintiffs are New York-area Mercedes purchasers, they all shared the common legal question of whether the defendants had engaged in a price-fixing conspiracy. The ruling is a victory for a Philadelphia-based team of plaintiffs’ attorneys led by Lisa J. Rodriguez of Trujillo Rodriguez & Richards; Eugene A. Spector and Jeffrey J. Corrigan of Spector, Roseman & Kodroff; Anthony J. Bolognese of Bolognese & Associates; and joined by Michael D. Hausfeld and Paul T. Gallagher of Cohen, Milstein, Hausfeld & Toll in Washington, D.C. Wolin rejected a defense argument that the case was fatally flawed since the “relevant market” should include all luxury cars, and that Mercedes dealers would therefore lack the power to affect prices in the market. “It does not matter … whether the defendants had sufficient market power to influence the price of all luxury cars. The [alleged] conspiracy influenced in an anti-competitive way the price of the automobiles in the limited universe of the Mercedes-Benz New York region,” Wolin wrote. Defense lawyers argued that proof of market control is required to show antitrust impact because, without such impact, consumers would simply go elsewhere when conspirators attempt to raise prices. Wolin disagreed, saying he found the argument “wholly circular.” “If the conspirators had not been able to raise prices, there would have been no antitrust activity in the first place,” Wolin wrote. In cases alleging “per se” antitrust violations, the plaintiffs’ initial burden is simply to show that a conspiracy occurred and prices were raised. Only then, Wolin said, does a court address the question of antitrust impact. “If the substantive violation is proved and it is shown that all class members purchased from a price-inflating conspirator, the causal chain is complete regardless of what may have been occurring in the larger marketplace,” Wolin wrote. In the suit, the plaintiffs claim they were victims of both horizontal and vertical price-fixing conspiracies for a seven-year period that ended in August 1999. The suit says Mercedes dealerships in the New York City tri-state area exchanged financial information, including pricing strategies and historical sales data. Mercedes-Benz USA is accused of facilitating the conspiracy by having its accountant compile monthly analyses of each dealer’s average price and gross profits for each model of car sold which was then allegedly shared by the dealerships for the purpose of policing compliance with the price-fixing scheme. The suit says the accountants convened meetings of the dealerships to discuss the financial reports. At those meetings, the suit alleges, “Dealers were lectured about the importance of not competing against each other on the basis of price, and any dealer whose monthly reports indicated lower pricing and gross profit levels than the others was singled out and berated.” The suit says Mercedes-Benz USA “knew of and facilitated” the meetings, and shared in the dealerships’ goal of restricting price competition.

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