Litigation is mounting against the world’s biggest manufacturers of rechargeable lithium ion batteries, who consumers accuse of complicity in an illegal price-fixing scheme.
At least 10 class actions have been filed in federal courts against the Japanese and Korean companies Panasonic, LG, Sony, Samsung, Sanyo and Hitachi and their American subsidiaries, which are all based in California and New Jersey.
The plaintiffs generally allege that since 2000, the defendants have collectively controlled 60 percent to 90 percent of the worldwide market for the batteries, which power cell phones, laptops, digital cameras, MP3 players and other portable electronic devices.
The global market for the batteries was about $14 billion in 2011 and is expected to exceed $16 billion this year, they say.
The plaintiffs, mainly consumers, say they paid more than they should have to buy the batteries from third-party vendors or for laptops and other devices that came with the batteries installed.
If they prevail, they could recover treble damages and legal fees, among other amounts.
In support of their claims, the plaintiffs point to a history of similar behavior.
They allege that the defendants, along with their parents and affiliates, orchestrated some of the largest price-fixing conspiracies of the past decade, in which the companies and some of their executives pleaded guilty to schemes involving random access memory chips, LCD screens and other consumer electronics components.
They assert the alleged battery price-fixing scheme has similar features: a highly concentrated market, controlled by Asian corporations; pricing pressure exerted by equipment manufacturers; rapid commoditization of new technology; and pricing behavior inconsistent with a competitive market.
The complaints trace the history of the batteries, first sold by Japanese companies such as Sony and Panasonic starting in 1991.
Despite increasing demand, prices fell sharply, by nearly 50 percent from 2000 to 2002, once Korean manufacturers like LG Chem and Samsung entered the market and spurred aggressive price competition, say the plaintiffs.
They claim the defendants entered into a conspiracy to stabilize and increase prices in late 2001 or early 2002, and from that point, prices rose steadily and substantially until the 2008 economic downturn. At that point, the companies slashed production by almost 66 percent to stem the drop.
The U.S. Department of Justice and the European Union allegedly launched an investigation last year, public disclosure of which has been followed by a fall in prices by some of the defendants, which the plaintiffs say is to be expected with the end of a price-fixing cartel.
The first of the lawsuits, Young v. LG Chem, Ltd., 12-cv-5129, was filed on Oct. 3 in the U.S. District Court for the Northern District of California.
The plaintiffs’ firm, Seattle-based Hagens Berman Sobol Shapiro, filed a second suit in the district one day later, Hanlon v. LG Chem, Ltd., 12-cv-5159, as local counsel for Cohen Milstein Sellers & Toll in Washington, D.C.
Two more cases were filed in the same district on Oct. 11. The lawyers in the second two cases have asked U.S. District Judge Yvonne Gonzalez Rogers, who is assigned to Young, the first case filed, to take on all four matters to avoid duplication of effort and the possibility of conflicting results.
At least two more suits, filed Oct. 15 and 17, are pending in the Southern District of California.
The first of at least four suits brought in New Jersey, Clark v. LG Chem America, Inc., 12-cv-6431, was filed Oct. 12 by the New York firm of Labaton Sucharow, with Roseland’s Carella Byrne Cecchi Olstein Brody & Agnello as local counsel.
Carella Byrne is local counsel in two additional actions filed in New Jersey on Oct. 16 and 17.
The most recent New Jersey filing, on Oct. 19, was A-1 Computers, Inc. v. LG Chem Ltd., 12-6581. It has the only corporate plaintiff thus far, A-1 Computers of Jacksonville, Ark., which is represented by the Little Rock, Ark., firm of Emerson Poynter and Trujillo Rodriguez & Richards of Haddonfield.
The New Jersey complaints were lodged in Newark and have been assigned to U.S. District Judge Dennis Cavanaugh and U.S. Magistrate Judge Mark Falk.
The Judicial Panel on Multidistrict Litigation in Washington, D.C., has already received a request to consolidate the lawsuits in New Jersey, filed by Carella Byrne’s James Cecchi on Oct. 16. He contends New Jersey is the most appropriate forum because three defendants — American subsidiaries of LG, Maxell and Panasonic — are located here, along with witnesses and evidence.
Cecchi also bases his request on New Jersey’s accessibility for “geographically diverse parties,” the district’s less congested docket than Northern California’s and Cavanaugh’s experience in handling complex, multidistrict suits, like ones involving marketing of Tropicana orange juice and Vytorin/Zetia.
As of Tuesday, none of the defendants had been served and none could be reached except Maxell Corporation of America, a subsidiary of Hitachi located in Woodland Park, and Samsung, both of which declined comment.
Jason Zweig, of Hagens Berman’s New York office, says extensive research went into the drafting of the initial complaint by his firm and the subsequent suits are piggybacking on that effort.