United States District Court For The Southern District Of California Certifies Big Tuna Classes
08/06/2019On July 30, 2019, U.S. District Court Judge Janis Sammartino of the Southern District of California certified three separate classes of tuna purchasers alleging price-fixing by producers of packaged tuna: (1) direct-purchaser plaintiffs, (2) commercial-food-preparer plaintiffs, and (3) end-payer plaintiffs. In re Packaged Seafood Products Antitrust Litigation, No. 15-MD-2670, July 30, 2019.
Plaintiffs in this multi-district litigation alleged that defendants conspired to fix the price of packaged tuna products from November 2010 until at least December 31, 2016. This litigation arose out of US DOJ investigation into price-fixing among seafood processors that has resulted in a number of prosecutions and guilty pleas for price-fixing, with at least one criminal case still awaiting trial. According to the class plaintiffs, “defendants agreed to fix certain net and list prices for packaged tuna, agreeing to limit promotional activity for packaged tuna, and agreeing to exchange sensitive or confidential business information for the purpose of facilitating the object of the conspiracy.” Three separate classes moved for class certification.
With respect to the proposed direct-purchaser class, defendants focused their challenge on disputing that the class satisfied Rule 23(b)’s requirement that common questions predominate. Among other things, defendants vigorously attacked plaintiffs’ expert’s pooled regression model, presenting their own expert model showing that approximately 28% of putative class was not injured, and arguing that even if one accepted the plaintiffs’ model on its terms, it did not produce any result for a substantial number of putative class members, and thus that the direct purchaser plaintiffs could not prove impact through common evidence or a common methodology. After a hearing in which she heard live testimony from the parties’ experts and a lengthy written analysis of the experts’ respective models and positions, Judge Sammartino was persuaded, at least for the purposes of certifying a class, that the plaintiffs’ expert’s model was sufficiently reliable and “capable” of showing impact to all or nearly all class members.
Defendants mounted a broader challenge to the commercial-food-preparer class. Defendants challenged the adequacy of named representative under Rule 23(a)(4), as well as predominance. With respect to adequacy of counsel, defendants pointed to deposition testimony evidencing the proposed class representatives’ alleged lack of knowledge and supervision of the fundamentals of the litigation, but the Court rejected this claim, finding “that each Representative understands the general nature of the claims and their general responsibilities as a class representative [and] the CFP Representatives also have actively” participated in discovery and sat for depositions.” The Court rejected the predominance challenge on similar grounds as with respect to the direct-purchaser class.
Finally, with respect to the end-payer plaintiffs, the Court again rejected defendants’ arguments challenging predominance, ruling that the methodology put forth by plaintiffs’ expert “is reliable and capable of proving impact.” As with the other plaintiffs’ experts, the Court pointed the defendants to cross examination at trial as their opportunity to challenge the validity the opposing experts’ conclusions, explaining “Defendants once again raise potential flaws in the methodology that could convince a finder of fact that the EPPs have not proven impact; however, the potential flaws raised are not so dramatic that the methodology must be thrown out and certification denied.”
The Court’s 59-page opinion is comprehensive in analyzing the expert evidence and contentions, but it is important to note that the Court did not rely solely on the experts’ econometric analysis in certifying these classes. The Court also pointed to the “the record evidence, guilty pleas, and market characteristics” that would also be used as evidence common to the class, as showing “that common questions will continue to predominate over the case.”