Ontario Superior Court of Justice

Auto Parts Class Actions

Alternators

• Sheridan Chevrolet et al v Denso Corporation et al (CV-13-478125-CP)
• Sheridan Chevrolet et al v Robert Bosch GmbH et al (CV-16-549375-CP)

Electric Powered Steering Assemblies

• Sheridan Chevrolet et al v JTEKT Corporation et al (CV-14-506652-CP)

Electronic Control Units

• Sheridan Chevrolet et al v Sumitomo Electric Industries, Ltd. et al (CV-13-482967-CP)

Electronic Throttle Bodies

• Sheridan Chevrolet et al v Hitachi, Ltd. et al (CV-14-506649-CP)

Fuel Injection Systems

• Sheridan Chevrolet et al v Hitachi, Ltd. et al (CV-14-506683-CP)

High Intensity Discharge Ballasts

• Sheridan Chevrolet et al v Panasonic Corporation et al (CV-14-506680-CP)

Ignition Coils

• Sheridan Chevrolet et al v Diamond Electric Mfg. Co. Ltd. et al (CV-14-506686-CP)

Inverters

• Sheridan Chevrolet et al v Denso Corporation et al (CV-15-524183-CP)

Manual Steering Columns

• Sheridan Chevrolet et al v Yamada Manufacturing Co., Ltd et al (CV-15-529853-CP)

Motor Generators

• Sheridan Chevrolet et al v Denso Corporation et al (CV-15-524184-CP)

Occupant Safety Systems

• Sheridan Chevrolet et al v Autoliv ASP, Inc. et al. (CV-13-472259-CP)

Oxygen Sensors

• Sheridan Chevrolet et al v Denso Corporation et al. (CV-14-516006-CP)

Power Window Motors

• Sheridan Chevrolet et al v Asmo North Carolina, Inc. (CV-16-549377-CP)

Spark Plugs

• Sheridan Chevrolet et al v Denso Corporation et al. (CV-14-516004-CP)

Starters

• Sheridan Chevrolet et al v Denso Corporation et al (CV-13-478127-CP)

Switches

• Sheridan Chevrolet et al v Omron Corporation et al (CV-16-549727-CP)

Valve Timing Control Devices

• Sheridan Chevrolet et al v Hitachi, Ltd. et al (CV-14-506670-CP)

Windshield Wiper Systems

• Sheridan Chevrolet et al v Denso Corporation et al (CV-13-478180-CP)

Proceeding under the Class Proceedings Act, 1992, S.O. 1992, c. 6

Before: Justice Edward P. Belobaba

Counsel: Charles M. Wright, David Sterns and Kristen King for Plaintiffs Neil Campbell for Bosch and Sumitomo Defendants James Gotowiec for Mitsubishi Electric Defendants Rob Kwinter for Omron, NSK, and NGK Spark Plugs Defendants Katherine Kay for Takata, Toyo Denso, Aisin Seiki and other various Defendants Chantelle Cseh for Denso and ASMO Defendants Yuxi (Wendy) Sun for Hitachi and Nachi Defendants Daphne Papadatos for Maruyasu and Yamada Defendants Suzy Kauffman for Fujikara and Nishikawa Defendants Jonathon McDaniel for Panasonic and Delphi Defendants Caitlin R. Sainsbury and Pierre Gemson for Aisan Defendants

Heard: September 21, 2018

Auto Parts Class Actions

Aisan, Bosch, Melco and Omron Settlements

Settlement and Fee Approvals

Reasons for Decision

[1] I am currently case-managing some 42 class actions alleging price-fixing in the global automotive parts industry. The actions are at various stages of litigation and involve a variety of auto parts produced by a wide range of suppliers. The class actions materialized in the aftermath of high-profile criminal and regulatory investigations and prosecutions in the United States, Canada and Europe.

[2] The Auto Parts Cases are being prosecuted on a coordinated basis by class counsel in Ontario, British Columbia and Quebec. The Canadian settlements to date total some $40 million. The overall litigation is far from over.

[3] The plaintiffs bring this motion for judicial approval of 15 discrete auto part settlements with the Aisan, Bosch, Melco and Omron defendants. The actions were certified for settlement purposes as against the settling defendants when the notices were approved.

[4] The applicable law on settlement approval in Ontario is well established. The Court must be satisfied that the proposed settlement is fair, reasonable and in the best interests of the class. The key question is whether the settlement falls within a zone of reasonableness. [1] The plaintiffs support the settlements and no objections have been filed.

[5] I note that in addition to the settlement amounts discussed below, each of the four suppliers has also agreed to co-operate in the continuing price-fixing litigation and have provided useful information about the global auto parts industry and the scope and content of the alleged conspiracy.

[6] I am satisfied on the evidence presented by class counsel that each of the proposed settlements fall within a zone of reasonableness and should be approved. In each case, when the Canadian settlement is compared to the related American settlement (which I must accept as legitimate and reasonable) it falls within the appropriate proportions. I am also persuaded that the discontinuance motion and class counsel’s legal fees should also be approved. I will explain each of these in turn.

Settlement Approvals

Aisan

[7] In December 2017, Aisan Industry Co. Ltd., Franklin Precision Industry, Inc., Aisan Corporation of America, and Hyundam Industrial Co., Ltd. (collectively “Aisan” [2]) settled the following actions for CDN $596,160, allocated as follows:

• Electronic Throttle Bodies (ETB): US$440,000
• Fuel Injection Systems (FIS): US$40,000

[8] The evidence suggests that the Aisan defendants’ exposure was limited to sales to Nissan in the United States. Aisan settled the related U.S. dealer and end payor actions for USD$6 million. The Canadian settlement amount represents 8 per cent of the U.S. dealer and end payor settlements. The information disclosed in the American criminal proceeding indicates that the volume of commerce in the U.S. was at least USD$35 million. Assuming 8.1% was resold in Canada (which is consistent with relative Canadian/U.S. sales of Nissan vehicles), the relevant Canadian commerce was US$2,835,000. The settlement amount of US$480,000 represents 16.9% of the estimated Canadian commerce.

Melco

[9] In March 2018, Mitsubishi Electric Corporation, Mitsubishi Electric Automotive America, Inc. and Mitsubishi Sales Canada, Inc. (collectively “Melco”) settled the 11 actions listed below for CDN$8,500,000. The settlement amount was allocated as follows:

• Alternators: $2,200,000
• Electric Powered Steering Assemblies: $150,000
• Electronic Control Units: $150,000
• Electronic Throttle Bodies: $50,000
• Fuel Injection Systems: $400,000
• High Intensity Discharge Ballasts: $150,000
• Ignition Coils: $2,500,000
• Inverters: $150,000
• Occupant Safety Systems: $150,000
• Starters: $2,000,000
• Valve Timing Control Devices: $600,000

[10] This allocation was based on the allocation that was used in Melco’s U.S. settlement agreements, the volume of commerce disclosed in documents from related criminal proceedings, confidential sales information provided by Melco during negotiations, and information received from settled defendants and Melco under their cooperation obligations. The Canadian settlement amount is approximately 8% of the U.S. Settlements.

Omron

[11] In March 2018, Omron Corporation, Omron Automotive Electronics Co. Ltd., Omron Automotive Electronics, Inc. and Omron Automotive Technologies Inc. (collectively “Omron”) settled the Switches action for US$390,000, an amount that is just under 10 per cent of the settlements that were achieved in the U.S.

Bosch

[12] In June 2018, Robert Bosch GmbH, Robert Bosch Inc., Robert Bosch LLC and RBKB Bosch Electrical Drives, Co., Ltd. [3] (collectively, “Bosch”) settled the following actions:

• Fuel Injection Systems: CDN$375,000
• Oxygen Sensors: US$1,747,750 (CDN$2,325,556)
• Spark Plugs: US$1,747,750 (CDN$2,325,556)
• Starters: CDN$250,000
• Windshield Wiper Systems: CDN$150,000
• Total: CDN$5,426,112

[13] The amount of Bosch’s U.S. settlements in the dealer and end payor actions was USD$44 million. The Canadian settlement is about 10% of the U.S. settlements.

Conclusion

[14] In sum, each of the proposed settlement agreements as described above are approved. Each settlement falls within a zone of reasonableness. I am satisfied that they are fair and reasonable and in the best interests of the class members.

Bosch Discontinuances

[15] The plaintiffs seek to discontinue the alternators, inverters, manual steering columns, motor generators, and power window motors actions against Bosch on a without costs and without prejudice basis.

[16] The plaintiffs and Bosch have entered into tolling agreements relating to these auto parts. In the tolling agreements Bosch represented that (i) they are not subject to antitrust investigations with respect to the relevant parts; (ii) they are not currently involved in any active U.S. litigation; or, (iii) any relevant U.S. actions were dismissed or stayed. In addition, Bosch indicated that a thorough investigation involving all auto-product lines, including the auto parts being discussed herein, found no evidence of improper conduct.

[17] Class counsel therefore believe that discontinuing the litigation against Bosch in the five specified actions is appropriate. I agree. Under s. 29(1) of the Class Proceedings Act, [4] I approve the discontinuance of the alternators, inverters, manual steering columns, motor generators, and power window motors actions on a without costs and without prejudice basis.

Approval of legal fees and disbursements

[18] The total amount to be paid into trust by the defendants in these settlements is CDN$13,483,524. Based on the retainer agreements, class counsel in the related Ontario and B.C. actions are entitled to a 25 per cent contingency fee, plus disbursements and taxes.

[19] As discussed in Cannon, [5] and as further refined in Brown, [6] this contingency fee amount is presumptively valid on the facts herein and should be approved.

[20] I therefore approve Ontario and B.C. class counsel’s legal fees in the aggregate amount of $3,370,881.39 plus disbursements of $274,859.30 (including interest) and applicable taxes.

[21] Orders to go as per the draft orders that were signed by me at the conclusion of the hearing.

Justice Edward P. Belobaba

[1] Dabbs v. Sun Life Assurance, (1998), 40 O.R. (3d) 429 (Gen. Div.), aff’d (1998), 41 O.R. (3d) 97 (C.A.), leave to appeal to S.C.C. refused Oct. 22, 1998; Parsons v. Canadian Red Cross Society, [1999] O.J. No. 3572 (S.C.J.); Urlin Rent a Car v Furukawa Electric, 2016 ONSC 7965 at para 5. [2] Hyundam Industrial Co., Ltd. is only a party to the Aisan Settlement Agreement in the Fuel Injection Systems action. [3] RBKB Bosch Electrical Drives Co. Ltd. is only a party to the Bosch Settlement Agreement in the Windshield Wiper Systems Action [4] Class Proceedings Act, 1992, S.O. 1992, c. 6. [5] Cannon v. Funds for Canada Foundation, 2013 ONSC 7686. [6] Brown v. Canada (Attorney General), 2018 ONSC 3429.