Ramen Noodle Makers Cleared by Jury in Price-Fixing Class Action

A federal jury recently determined that Korean ramen noodle companies were not liable for alleged price-fixing which purchasers claim raised prices.

The verdict resolves claims brought by direct and indirect purchasers who claimed that Korean ramen noodle companies conspired together to fix the prices of their products.

The ramen noodle class action lawsuit was initiated in 2013 after a 2012 report by Korean authorities allegedly detailed collusion between companies and issued fines against the companies totaling around 136 billion won, or $125 million USD.

The jury in the ramen noodle class action trial answered “no” to the question of whether or not plaintiffs proved “that there was a conspiracy to fix the prices of Korean ramen noodles.”

With this determination, defendants Nongshim Co. Ltd. and Ottogi Co. Ltd. and their U.S. subsidiaries have been let off the hook, which is a rare conclusion for antitrust litigation.

“It is quite rare for antitrust class action cases to go to verdict in the U.S., and we are delighted with the jury’s conclusion,” said one of Nongshim’s lawyers, according to Law 360.

Ottogi’s counsel reflected similar sentiments saying that  “We are grateful that the jury vindicated the position of our client Ottogi, which did nothing wrong.”

The original ramen noodle class action brought claims against Ottogi, Nongshim, Korea Yakult, and Samyang, in addition to the companies’ American’s subsidiaries.

The ramen class action lawsuit accused the companies of an “unlawful conspiracy to raise, fix, maintain and/or stabilize prices of Korean Ramen Noodle Products resulted in artificially inflated prices of Korean Ramen Noodle Products in the United States. Plaintiff paid a premium for Korean Ramen Noodle Products during the Class Period over the price that would have prevailed in a competitive market.”

According to plaintiffs in the ramen noodle class action, Nongshim increased prices first as the industry leader and other defendants would raise their prices shortly thereafter.

The defendants denied the antitrust claims, blaming the uniform price increases on an increased cost of ingredients wheat flour and palm oil.

However, plaintiffs said that this argument was based in false and misleading statements which aimed to conceal the alleged conspiracy.

Litigation continued to be fiercely debated after the ramen class action was filed. Eventually, several antitrust ramen noodle lawsuits were consolidated into one complaint. By the time of the trial, the only ramen noodle defendants remaining were Ottogi and Nongshim.

In November 2018, plaintiffs brought in a forensic computer expert who testified that documents submitted to the Korean Fair Trade Commission were altered by the ramen noodle companies before being submitted to the investigation.

However, this new evidence could not save the ramen noodle class action as the jury determined the companies to be not liable.

Plaintiffs and the proposed Class are represented by Christopher Lebsock, Bonny Sweeney, Stephanie Cho and Michael Hausfeld of Hausfeld LLP; Brian Murray, Lee Albert, Gregory Linkh and Lionel Glancy of Glancy Prongay & Murray LLP; Alan Plutzik and Daniel Birkhaeuser of Bramson Plutzik Mahler & Birkhaeuser LLP; and Mark Kindall and Robert Izard of Izard Kindall & Raabe LLP.

The Ramen Noodle Price-Fixing Class Action Lawsuit is In re: Korean Ramen Antitrust Litigation, Case No. 3:13-­cv-­04115, in the U.S. District Court for the Northern District of California.

UPDATE: August 2019, a $350,000 settlement fund will be distributed between direct purchasers of Korean noodles that were allegedly the subject of a price-fixing scheme.