Panasonic Fails to Evade Car AC Price-Fixing Class Action Claims

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Following the dismissal of two state law claims, Panasonic will continue to face a massive antitrust litigation over its role in an alleged conspiracy to manipulate the price of automotive air conditioner systems.

U.S. District Judge Marianne O. Battani denied a motion for dismissal brought by defendants Panasonic Corp. and Panasonic Corp. of North America.

Panasonic sought dismissal of two separate complaints accusing the company of participating in an industry-wide price-fixing conspiracy.

The plaintiffs include auto dealers and end purchasers of vehicles allegedly equipped with the Panasonic air conditioning systems at issue. Their claims join several others in an enormous multidistrict litigation, or MDL, consolidating multiple car part antitrust lawsuits against dozens of manufacturers.

Plaintiffs in this MDL point out that in 2013, Panasonic pled guilty to criminal allegations that it colluded to fix prices of parts for vehicle light and steering systems. The company paid a $45.8 million criminal fine as a result of that prosecution. Other defendants have agreed to similar fines and guilty pleas, the plaintiffs said.

The plaintiffs also claim Panasonic met with other manufacturers between 2007 and 2009 to discuss the state of the market and their companies’ negotiations with original equipment manufacturers. Judge Battani found this history supportive of the plaintiffs’ allegations of a conspiracy surrounding air conditioner parts.

The judge rejected Panasonic’s argument that the plaintiff’s use of the term “AC Systems” is an overreach, since Panasonic makes system parts but not entire systems. She noted that throughout this litigation, the court has held that a defendant need not make an entire system for the plaintiff to make a plausible allegation of conspiracy.

In a separate order and opinion, Judge Battani dismissed two specific state law claims, one for unjust enrichment under Florida law and the other for violation of South Dakota antitrust laws.

The Florida unjust enrichment claim, one of 25 such claims brought under the laws of as many different states, fell thanks to a recent opinion of the Florida Supreme Court.

In that opinion, the court held that an unjust enrichment claim requires the plaintiff to have received a benefit directly from the defendant. Judge Battani determined that the benefit conferred from the plaintiffs to the defendants was not direct, and therefore the plaintiffs failed to allege a claim for unjust enrichment under Florida law.

The judge noted that this conclusion was different from others reached in the same litigation regarding unjust enrichment claims, where the laws of other states permit the benefit to be conferred indirectly.

Claims under South Dakota law were dismissed since the plaintiffs failed to allege that any of them purchased price-fixed products within that state.

Panasonic is just one of dozens of defendants facing this massive litigation over allegations of car part price-fixing. Vehicle parts at issue go beyond air conditioner parts to include parts for engines, accessories, occupant safety restraint systems, and other vehicle systems.

With such a large number of plaintiff purchasers and defendant manufacturers, settlement agreements are being reached one at a time. A settlement with one group of defendants was delayed by an appeal, while another settlement was approved by the court in July 2017.

Individual defendants have also been striking deals on their own. In the summer of 2017, defendants Koito and Diamond Electric reached deals worth $22.99 million and $5.4 million, respectively, and later in October defendant Mitsuba agreed to a $72 million settlement that would benefit 10 different plaintiff Classes.

The consumers are represented by The Miller Law Firm PC, Robins Kaplan LLP, Susman Godfrey LLP and Cotchett Pitre & McCarthy LLP. The auto dealers are represented by Mantese Honigman PC, Cuneo Gilbert & LaDuca LLP, Barrett Law Group PA and Larson King LLP.

The Panasonic Automotive Air Conditioner Parts Antitrust Class Action Lawsuit is part of In re: Automotive Parts Antitrust Litigation, Master File No. 12-md-02311, in the U.S. District Court for the Eastern District of Michigan.