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Two doormakers – Jeld-Wen and Masonite – have agreed to pay $75 million in two settlements to resolve molded interior doors price-fixing claims against them.
In a U.S. Securities and Exchange Commission (SEC) filing, Masonite revealed the details of the proposed settlement. Under the terms of the deal, Jeld-Wen and Masonite will each pay $28 million to a Class of direct buyers and $9.75 million to indirect buyers.
Although the companies have agreed to resolve the claims against them, Masonite’s SEC filing noted that they have not admitted any wrongdoing under price-fixing laws.
“The company continues to believe the claims are without merit and denies any liability for the claims made against it, but entered into the settlements in order to avoid the incurrence of further cost and expense and to avoid the uncertainties inherent in any litigation,” Masonite wrote in the SEC filing.
Plaintiffs in the Masonite molded interior doors price-fixing class action lawsuit claimed that Masonite and Jeld-Wen violated federal laws by conspiring together to increase door prices. The companies reportedly hold an 85% share of the interior molded door market – allegedly giving them the power and position to increase the prices of the products.
The companies’ scheme was reportedly enhanced by the fact that they virtually controlled the entire market for interior molded door skins. Door skins are the coverings which go over composite wood or a wood frame to make an interior door look like it is made out of real wood. These components are essential in manufacturing interior molded doors – meaning that Masonite and Jeld-Wen had even more control over the interior molded door market.
As a result of the alleged price-fixing, both direct purchasers – who purchased the doors directly from Masonite or Jeld-Wen – and indirect purchasers – who purchased doors from direct purchasers – were forced to pay higher prices for the products. This allegedly caused financial injury to purchasers.
Purchasers filed their claims nearly two years after a building materials supplier Grubb Lumber Co. Inc. filed price-fixing claims against the company. The company argued that Masonite and Jeld-Wen illegally conspired together to charge direct purchasers a higher price for molded interior doors.
“Defendants’ price increases alleged herein cannot rationally be explained by normal market forces, such as key input costs or supply and demand factors. The largest input cost of interior molded doors are interior molded doorskins,” Grubb Lumber said in their price-fixing lawsuit.
“Since defendants are vertically integrated, they control those costs and their price increases have outpaced any increase to their raw material and other costs.”
The suit was also filed only weeks after a notable court order against Jeld-Wen by a federal judge.
In his court order, Judge Robert E. Payne ordered a Jeld-Wen door skins plant in Pennsylvania to be divested from the company. Under the terms of the order, Jeld-Wen was forced to divest the plant itself in addition to inventory, office furniture, computer systems, materials, certifications, licenses, permits, contracts, customer lists, supply agreements, patents trade secrets, other intellectual property, repair and maintenance records, and more.
The court also required the company to enter into various contracts which ensured that the divesture would result in another company – such as rival door skins company Steves and Sons – could take control of the plant and provide healthy competition in the market.
This move intended to prevent the company from anti-competitive and price-fixing behaviors in the future.
“The public interest is best served by ordering divestiture and the related conduct remedies herein provided,” Judge Payne wrote in his divesture order.
“Without the divestiture and the related conduct remedies […] [Steves and Sons Inc.] will suffer irreparable injury […] The hardships Steves will suffer if the divestiture and the related conduct remedies herein provided are not granted substantially outweigh the hardships to JELD-WEN if the divestiture and the related remedies herein provided are granted.”
Did you purchase Masonite molded interior doors? Share your thoughts on this price-fixing class action settlement in the comment section below.
The proposed Class is represented by Wyatt B. Durrette Jr., Christine A. Williams, and Kevin J. Funk of Durrette Arkema Gerson & Gill PC; Michael J. Boni, Joshua D. Snyder, John E. Sindoni and Robert E. Haimes of Boni Zack & Snyder LLC; and Jeffrey J. Corrigan, Jeffrey L. Spector and Icee N. Etheridge of Spector Roseman & Kodroff PC.
The Masonite Molded Interior Doors Price-Fixing Class Action Lawsuit is In re: Interior Molded Doors Antitrust Litigation, Case No. 3:18-cv-00718, in the U.S. District Court for the Eastern District of Virginia.
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89 thoughts on$75M Price-Fixing Deal To End Jeld-Wen, Masonite Molded Interior Doors Class Action Lawsuit
They are sleezy!
What company pushes the long tenured employees out who helped them get where they are to pay younger green kids with no exp less $ and to also pay the ceo millions and millions and growing everytime there’s a new boss in there.
Add me please . Have 13 doors from my new house built in 2018
I purchased 15 doors 2019
I have 10 Jeld windows that have developed these stains that impedes visibility. It’s just a matter of time before all my Jeld windows go bad.
I sold doors for a big box home improvement retailer for many years. I always thought Jeld-wen was a sleazy company. Badly run. Lots of issues. And apparently stuff going on at the top….
Add me~bought 8 in 2020
I have bought 6 doors in 2020 for my home.. how to be added please
Add me ,bought seven doors for my house.