COURT FILES: Listed below
DATE: 20210520
ONTARIO
SUPERIOR COURT OF JUSTICE
Air Conditioning Systems
Sheridan Chevrolet et al v Valeo S.A. et al
CV-14-506637-CP
Automatic Transmission Fluid Warmers and Oil Coolers
Sheridan Chevrolet et al v T. Rad Co., Ltd. et al.
CV-14-506644-CP
Automotive Exhaust Systems
Sheridan Chevrolet et al v Bosal International NV et al
CV-17-582446-CP
Automotive Steel Tubes
Sheridan Chevrolet et al v Maruyasu Industries Co., Ltd. et al
CV-17-582447-CP
Bearings
Sheridan Chevrolet et al v. JTEKT Corporation et al
CV-13-478644-CP
Braking Systems
Kate O’Leary Swinkels v ZF Friedrichshafen AG et al
CV-18-604648-CP
Electric Powered Steering Assemblies
Sheridan Chevrolet et al v JTEKT Corporation et al
CV-14-506652-CP
Fuel Injection Systems
Sheridan Chevrolet et al v Hitachi, Ltd. et al
CV-14-506683-CP
Heater Control Panels
Sheridan Chevrolet et al v Denso Corporation et al
CV-12-449233-CP
High Intensity Discharge Ballasts
Sheridan Chevrolet et al v Panasonic Corporation et al
CV-14-506680-CP
Instrument Panel Clusters
Sheridan Chevrolet et al v Nippon Seiki Co., Ltd. et al
CV-12-449238-CP
Manual Steering Columns
Sheridan Chevrolet et al v Yamada Manufacturing Co. Ltd. et al
CV-15-529853-CP
Plastic Interior Trim
Sheridan Chevrolet et al v Calsonic Kansei Corporation et al
CV-16-549733-CP
Radiators
Fady Samaha v Denso Corporation et al
CV-13-478182-CP
Shock Absorbers
Sheridan Chevrolet et al v Kayaba Industry Co. Ltd. et al
CV-16-549728-CP
Steering Angle Sensors
Sheridan Chevrolet et al v Panasonic Corporation et al
CV-14-506746-CP
Switches
Sheridan Chevrolet et al v Panasonic Corporation et al
CV-14-506672-CP
Valve Timing Control Devices
Sheridan Chevrolet et al v Denso Corporation et al
CV-14-506670-CP
Proceedings under the Class Proceedings Act, 1992, S.O. 1992, c. c.6
BEFORE: Justice Edward Belobaba
COUNSEL: Charles M. Wright, Linda Visser, Jean-Marc Leclerc and Jonathan Schachter for the Plaintiffs
Michael Binetti for the Defendants Marelli Corporation (formerly known as Calsonic Kansei Corporation), and Marelli North America, Inc. (formerly known as Calsonic Kansei North America, Inc.)
Adam Chisholm for the Defendant Continental Tire Canada, Inc.
Emrys Davis for the Defendants Panasonic Corporation, Panasonic Corporation of North America, Panasonic Canada Inc., ZF Fiedrichshafen AG, TRW Automotive GmbH, TRW Vehicle Safety Systems Inc., TRW Canada Limited, Kelsey-Hayes Company, Kelsey-Hayes Canada Limited, and Nippon Seiki Co., Ltd., N.S. International, Ltd., and New Sabina Industries, Inc.
Antonio Di Domenico, Vera Toppings and Carolyn Flanagan for the Defendants INOAC Corporation, INOAC USA, Inc., INOAC Interior Systems LLC, Springfield Interior Trim, LLC, INOAC Interior Systems LP, Blenheim Interior Trim, LLP, and INOAC Canada Limited
Dan Edmondstone for the Defendants Faurecia SA, Faurecia Exhaust Systems, Inc., Faurecia USA Holdings, Inc. Faurecia Emissions Control Technologies, USA, LLC, Faurecia Emissions Control Technologies Canada, Ltd., Faurecia Abgastechnik GmbH, and Faurecia Systèmes d’Èchappement
David Gadsden and Brendan O’Grady for the Defendants Kayaba Industry Co. Ltd. d/b/a KYB Corporation and KYB Americas Corporation
Pierre Gemson for the Defendants Sanoh Industrial Co., Ltd., Sanoh America, Inc. and Sanoh Canada Ltd.
James Gotowiec for the Defendants Showa Corporation, American Showa Inc. and Showa Canada Inc.
Casey Halladay for the Defendants Schaeffler AG, Schaeffler Group USA Inc., Schaeffler Canada Inc., Schaeffler Technologies GmbH & Co. KG, FAG Kugelfischer GmbH, Stanley Electric Co., Ltd., Stanley Electric U.S. Co., Inc., II Stanley Co., Inc., Adient PLC and Adient Seating Canada LP
Donald Houston and Katherine Booth for the Defendants Alps Electric Co., Ltd., Alps Electric (North America) Inc. and Alps Automotive Inc.
Randal Hughes and Emrys Davis for the Defendants USUI Co., Ltd. and USUI International Corporation
Katherine L. Kay for the Defendants Aisin Seiki Co. Ltd., Aisin Holdings of America, Inc., Aisin World Corp. of America, Aisin Automotive Casting Tennessee, Inc., Friedrich Boysen GmbH & Co. KG, Boysen USA, LLC, Ichikoh Industries, Ltd., Keihin Corporation, Keihin North America, Inc., Toyo Denso Co., Ltd., Weastec, Inc., Valeo S.A., Valeo Incorporated, Valeo Japan Co. Ltd., Valeo Climate Control Corp., Valeo Compressor North America Inc., and Valeo Electrical System, Inc.
David Kent for the Defendants Robert Bosch GmbH, Robert Bosch LLC, Robert Bosch North America Corporation, Bosch Brake Components LLC and Robert Bosch Inc.
Robert Kwinter for the Defendants NSK Ltd., NSK Americas, Inc., NSK Canada Inc., NSK Europe Ltd., NSK Corporation, NSK Steering Systems America, Inc. and NSK Steering Systems Co., Ltd.
Eric Lefebvre for the Defendants JTEKT Corporation, JTEKT North America Corporation, Koyo France SA, Koyo Deutschland GmbH, Koyo Corporation of U.S.A., Koyo Canada Inc., Sanden Corporation, Sanden International (USA) Inc., Sanden Automotive Climate Systems Corporation and Sanden Automotive Components Corporation
Maureen Littlejohn for the Defendants Denso Corporation, Denso International America Inc., Denso Manufacturing Canada, Inc., Denso International Korea Corporation, Denso Korea Automotive Corporation, and Denso Sales Canada, Inc.
Paul Martin for the Defendants Mahle Behr GmbH & Co. KG, Mahle Behr USA Inc., Yamada North America, Inc., Yamada Manufacturing Co. Ltd., AB SKF, SKF USA Inc., SKF Canada Limited, and SKF GmbH
Kevin Wright for the Defendants Nachi-Fujikoshi Corp., Nachi America Inc., Nachi Canada Inc., Nachi Europe GmbH, and Nachi Technology Inc.
Sean Bhagwandin for non-Party Nissan Canada
Peter Pliszka for non-Party BMW
HEARD: May 13, 2021 via Zoom video
Auto Parts Class Actions
Motions for Settlement and Fee Approvals
Alps, Bosch, Calsonic, Faurecia, INOAC, KYB, Mikuni, NSK, Panasonic, Schaeffler, Showa, and USUI Settlements
[1] I am currently case-managing some 45 class actions alleging price-fixing in the global automotive parts industry. The actions 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] Many of the actions, or at least component-specific portions of the actions, have settled. The Canadian version typically settles soon after a settlement is achieved in the U.S. action. To date the total value of the Canadian settlements exceeds $100 million.
[3] In these motions, the plaintiffs seek judicial approval of (i) the settlement agreements entered into with 12 groups of defendants: Calsonic, Panasonic, INOAC, NSK, Schaeffler, Showa, KYB, Alps, Bosch, Faurecia, Mikuni, and USUI and (ii) class counsels’ legal fees.
Settlement approval
[4] The applicable law on settlement approval is well established. The court must be satisfied that the proposed settlement is fair, reasonable and in the best interests of the class. The primary determinant is that the proposed settlement fall within a “zone of reasonableness.”[^1] Because, as already noted, these price-fixing actions are first settled in the U.S., the required “zone of reasonableness” is generally satisfied if the Canadian settlement is 8 to 10 per cent of the American settlement or otherwise supported by comparative “volume of commerce” data.
[5] Here, most of the defendants had limited or no direct Canadian sales, or their direct purchaser customers opted out or resolved their claims on an individual basis. Accordingly, the relevant comparators are the combined indirect settlements in the U.S. for dealers and end-payors.
[6] The aggregate value of the 12 proposed settlements is $22.6 million. In addition, settling defendants have agreed to cooperate in any ongoing litigation. There are no objectors.
[7] Class counsel submit that the settlements are fair and reasonable compromises of the actions.
[8] I agree.
[9] The table below provides an overview of the proposed settlements and the comparable U.S. settlement percentages. As evident, all of the settlements are within 8 to 10% of the relevant U.S. indirect settlements. I am therefore satisfied that the settlements fall within the required “zone of reasonableness”.
Defendant
Part(s)
Date of Settlement
Settlement Amount (CAD)
Percentage of U.S. Indirect Settlements
Calsonic
Air Conditioning Systems, Automatic Transmission Fluid Warmers and Oil Coolers, Heater Control Panels, Instrument Panel Clusters, Plastic Interior Trim, and Radiators
January 25, 2021
$2,046,711.24
10%
Panasonic
Air Conditioning Systems, High Intensity Discharge Ballasts, Steering Angle Sensors, and Switches
October 30, 2020
$3,000,000
9.5%
INOAC
Plastic Interior Trim
January 13, 2021
US$325,000 (converted to CAD$413,627.50 on deposit)
10%
NSK
Bearings, Electronic Powered Steering Assemblies, and Manual Steering Columns
December 17, 2020
US$3,500,000 (converted to CAD$4,452,350 on deposit)
10.1%
Schaeffler
Bearings
January 28, 2021
$3,336,675
9.3%[^2]
Showa
Electronic Powered Steering Assemblies and Shock Absorbers
February 3, 2021
$2,369,480
10%
KYB
Shock Absorbers
February 24, 2021
$4,840,000
10%
Alps
Heater Control Panels
October 6, 2020
$425,000
8%
Bosch
Braking Systems
February 3, 2021
$319,326.88
n/a[^3]
Faurecia
Automotive Exhaust Systems
November 24, 2020
$207,962.04
8%
Mikuni
Fuel Injection Systems and Valve Timing Control Devices
November 21, 2020
$494,970
8%
USUI
Automotive Steel Tubes
October 2, 2020
$792,000
8.6%
[10] In assessing the reasonableness of the settlements, class counsel considered the factors set out below. The relevance and significance of the factors varied from settlement to settlement:
a. the relative order of settlement vis-à-vis the defendant’s U.S. settlement;
b. previous Canadian settlements achieved and the relative order of the Canadian settlements;
c. the value of cooperation that could be provided;
d. Canadian volume of commerce (“VOC”) information;
e. Canadian VOC disclosed as a percentage of relevant U.S. VOC;
f. the timing of various settlements relative to major steps taken in the litigation (i.e. authorization);
g. publicly available vehicle sales information;
h. the strength of the liability case, including the existence and scope of guilty pleas (or lack thereof) and information provided by previously settled defendants as part of their cooperation obligations; and
i. specific product information and/or involvement in the relevant auto part industry.
[11] In sum, I am satisfied on the basis of class counsels’ presentation that the 12 proposed settlements are fair and reasonable and in the best interests of the class. Each of these settlements is approved.
Legal fees approval
[12] Siskinds LLP together with Sotos LLP are co-counsel in the Ontario actions. Parallel ligation was commenced in British Columbia and/or Quebec. Siskinds and Sotos are working cooperatively with the law firms Camp Fiorante Matthews Mogerman LLP, counsel in the applicable British Columbia actions, and Siskinds Desmeules s.e.n.c.r.l., counsel in the applicable Quebec actions (“Class Counsel”).
[13] In September 2017 and January 2018, Klein Lawyers LLP commenced six actions in British Columbia and served certification records. In March 2019, Klein Avocats Plaideurs Inc. commenced six actions for the same auto parts in Quebec. In May 2020, Class Counsel agreed to coordinate with Klein Lawyers in three of those actions, including Automotive Steel Tubes and Plastic Interior Trim. Klein Lawyers agreed to stay the six actions and to seek such orders as necessary (i.e. discontinuance or dismissal) to facilitate settlements. In the cases where Class Counsel agreed to coordinate with Klein Lawyers, Klein Lawyers is to be considered counsel for class members located only in British Columbia. The agreements with Klein Lawyers are binding on Klein Avocats.
[14] The applicable retainer agreements have been previously approved in the relevant actions, with the exception of Braking Systems and Manual Steering Columns. I hereby approve the two additional retainer agreements.
[15] By agreement amongst Class Counsel, where there is a Quebec case, 7.2% of the settlement amounts are notionally allocated to the Quebec classes for the purpose of the fee applications in that province. The remaining amounts of those settlements are notionally allocated to the Ontario and BC classes for the purpose of the fee applications in those provinces.
[16] Where an action was not commenced in BC and/or Quebec, BC and/or Quebec counsel will be paid out of the fees awarded to Ontario Class Counsel.
[17] In the Automotive Steel Tubes actions, Class Counsel are seeking a fee award in Ontario and Klein Lawyers will be paid out of the fees awarded to Ontario Class Counsel.
[18] Based on the retainer agreements, Class Counsel are entitled to a 25 per cent contingency fee plus disbursements and taxes. As discussed in Cannon,[^4] and as further refined in Brown,[^5] this contingency fee amount is presumptively valid on the facts herein — that is, Ontario and BC Class Counsel’s legal fees total $5,402,108.66 plus disbursements of $224,007.98 (including interest), plus applicable taxes.
[19] The following chart summarizes the fee request, time incurred, and outstanding disbursements.
Part
Requested Fees
Time Incurred
Outstanding Disbursemts
Approving Courts
Air Conditioning Systems
$251,233.99
$174,967.20
$9,139.63
Ontario and BC
ATF Warmers & Oil Coolers
$16,216.88
$47,317.50
$3,950.84
Ontario
Automotive Exhaust Systems
$51,990.51
$191,514.08
$3,848.29
Ontario and BC
Automotive Steel Tubes
$198,000.00
$99,946.75
$1,926.44
Ontario and BC
Bearings
$1,657,276.75
$368,903.75
$11,259.40
Ontario, BC, and Quebec
Braking Systems
$79,831.72
$74,103.75
$138,704.51
Ontario and BC
EPS Assemblies
$282,126.24
$100,595.05
$4,600.55
Ontario
Fuel Injection Systems
$98,992.50
$421,201.32
$1,173.30
Ontario
Heater Control Panels
$110,200.00
$131,292.85
$2,626.69
Ontario, BC, and Quebec
HID Ballasts
$231,750.00
$74,427.00
$875.64
Ontario
Instrument Panel Clusters
$11,600.00
$304,505.15
$6,946.44
Ontario, BC, and Quebec
Manual Steering Columns
$53,428.20
$6,717.50
$9,941.03
Ontario
Plastic Interior Trim
$115,906.88
$112,258.08
$4,229.17
Ontario and BC
Radiators
$221,074.59
$453,921.50
$5,548.77
Ontario, BC, and Quebec
Shock Absorbers
$1,510,981.90
$111,229.50
$15,259.07
Ontario and Quebec
Steering Angle Sensors
$264,000.00
$67,069.45
$2,308.08
Ontario and BC
Switches
$222,750.00
$127,258.60
$625.24
Ontario
Valve Timing Control Devices
$24,748.50
$66,005.00
$1,044.89
Ontario
Total
$5,402,108.66
$2,933,234.03
$224,007.98
[20] The Notice of Hearing advised class members that Class Counsel would be seeking approval of counsel fees of up to 25% of the settlement amounts, plus disbursements and applicable taxes. The objection deadline was May 6, 2021. To date, no objections have been received.
[21] Class counsel’s legal fees and disbursements, as set out above, are approved.
Disposition
[22] The settlement agreements entered into with the defendants Calsonic, Panasonic, INOAC, NSK, Schaeffler, Showa, KYB, Alps, Bosch, Faurecia, Mikuni, and USUI are approved. As are class counsels’ legal fees.
[23] The retainer agreements relating to the Braking Systems and Manual Steering Columns are also approved.
[24] Orders to go as per the draft Orders signed at the conclusion of the hearing on May 13, 2021.
Signed: Justice Edward P. Belobaba
Notwithstanding Rule 59.05, this Judgment [Order] is effective from the date it is made, and is enforceable without any need for entry and filing. original signing, entry and filing when the Court returns to regular operations.
Date: May 20,2021
[^1]: Urlin Rent a Car v. Furukawa Electric, 2016 ONSC 7965, at para 5; Sheridan Chevrolet v. Furakawa Electric et al, 2016 ONSC 729, at paras 10-12.
[^2]: Schaeffler paid 9.3% of its direct and indirect purchaser settlements combined.
[^3]: Class counsel provided confidential commercial information that Bosch made available to them as part of their confidential settlement discussions. I am satisfied on the basis of this confidential information that the settlement with Bosch is fair and reasonable. Counsel for Bosch have undertaken to distribute the confidential information to all counsel on the service list forthwith upon being advised that it is no longer confidential.
[^4]: Cannon v. Funds for Canada Foundation, 2013 ONSC 7686.
[^5]: Brown v. Canada (Attorney General), 2018 ONSC 3429.