Court File and Parties
COURT FILE NO.: CV-16-549731-CP DATE: 20190711 ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
SHERIDAN CHEVROLET CADILLAC LTD., THE PICKERING AUTO MALL LTD., and FADY SAMAHA Plaintiffs
- and -
NISHIKAWA RUBBER CO., NISHIKAWA OF AMERICA, INC., COOPER-STANDARD HOLDINGS INC., COOPER-STANDARD AUTOMOTIVE INC., COOPER-STANDARD AUTOMOTIVE CANADA LIMITED, NISHIKAWA COOPER LLC, TOYODA GOSEI CO., LTD., TOYODA GOSEI NORTH AMERICA CORPORATION, WATERVILLE TG INC., TOKAI KOGYO CO., LTD. and GREEN TOKAI CO. LTD. Defendants
Proceeding under the Class Proceedings Act, 1992, S.O. 1992, c. 6
BEFORE: Justice Edward P. Belobaba
COUNSEL: Charles M. Wright and Jean-Marc Leclerc for the Plaintiffs Suzy Kauffman for the Defendants Nishikawa Rubber Co., Nishikawa of America Inc. and Nishikawa Cooper LLC Donald Houston for the Defendants Cooper-Standard Holdings Inc., Cooper-Standard Automotive Inc. and Cooper Standard Automotive Canada Limited James Gotowiec for the Defendants Toyoda Gosei Co. Ltd., Toyoda Gosei North America Corporation and Waterville TG Inc.
HEARD: July 10, 2019
Auto Parts Class Actions Body Sealing Products – Nishikawa Settlement 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 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 $46 million.
[3] The plaintiffs bring this motion for judicial approval of the settlement with the Nishikawa defendants in the Body Sealing Products action. This is the first settlement in the Body Sealing Products action. The plaintiffs support the settlement and no objections have been filed. Class counsel advise that there were no objectors at the parallel approval hearing in Quebec. I should also add that the Klein law firm (B.C. and Quebec), although notified of today’s proceeding, was not in attendance today.
[4] Nishikawa is the only signatory to the settlement agreement. However, the settling defendants are defined to include Nishikawa of America, Inc. and Nishikawa Cooper LLC.
[5] The plaintiffs have agreed to dismiss the case and release claims against Cooper-Standard Holdings Inc., Cooper-Standard Automotive Inc., and Cooper-Standard Automotive Canada Limited on a without costs and with prejudice basis. Nishikawa and Cooper-Standard Automotive Inc. jointly own and control a joint venture, Nishikawa Cooper LLC (a settling defendant). Cooper-Standard Automotive Inc. has a minority interest in the joint venture and has not been implicated in any wrongdoing.
Settlement approval
[6] The law on class action settlement approval in Ontario is well established. The court must be satisfied that the proposed settlement is fair and reasonable and in the best interests of the class. The key question is whether the settlement falls within a zone of reasonableness.
[7] Nishikawa has agreed to pay $5,750,000 to settle the Body Sealing Products action. Nishikawa has also agreed to provide cooperation, and to use its best efforts to secure satisfactory and timely provision of cooperation by Nishikawa of America, Inc. and Nishikawa Cooper LLC. Nishikawa has already provided pre-approval cooperation in the form of an attorney proffer.
[8] Settlement discussions with Nishikawa’s counsel began in January 2018, and included two in-person meetings with Nishikawa’s Canadian and U.S. counsel. A settlement in principle was achieved during the second in-person meeting in September 2018. The specific terms of the settlement agreement were then negotiated and the agreement was executed on January 21, 2019.
[9] Nishikawa only had limited direct sales into Canada. Based on this information, class counsel were satisfied that the U.S. dealer and end-payor settlements were the appropriate benchmark. Nishikawa settled its U.S. dealer and end-payor actions for US$49.5 million. Nishikawa’s Canadian settlement of $5.75 million is worth approximately 8.74% of its U.S. settlement, adjusted for currency. I am satisfied that this falls within the normal range of 8-10%. That is, the settlement herein falls within a zone of reasonableness.
[10] I find that the proposed settlement if fair and reasonable and in the best interests of the class.
Legal fees approval
[11] Based on the retainer agreements, class counsel are entitled to a 25 per cent contingency fee plus disbursements and taxes. This contingency fee amount is presumptively valid on the facts herein and should be approved.
[12] I therefore have no difficulty approving class counsel’s legal fees and disbursements as set out in the draft Order.
Disposition
[13] Orders to go approving both the settlement and class counsel’s legal fees as per the draft Orders that were signed by me at the conclusion of the hearing.