Class Action Antitrust Litigation

Sonnenschein’s strength is derived from years of work handling the full spectrum of antitrust matters combined with a commitment to employing innovative approaches in fending off class action lawsuits.  Clients turn to us because they know our outstanding track record in all facets of litigation—from class certification to trials and appeals in courts throughout the U.S.

Our experience includes responding to both federal and state class actions alleging price fixing, output restrictions, group boycott, price discrimination, “secret” rebates, attempted monopolization and monopolization, tying, exclusive dealing, anticompetitive mergers and unfair competition.  Sonnenschein has represented numerous companies in separate grand jury investigations of alleged price-fixing or bid-rigging activities and has conducted internal audits on companies’ behalf to ensure they are not susceptible to Department of Justice investigations that could lead to antitrust class actions.

Sonnenschein attorneys representing clients in antitrust class actions bring robust and wide-ranging experience. They include former officials at the Federal Trade Commission, a former head of the American Bar Association Section of Antitrust Law, and attorneys who have been litigating antitrust cases and class actions for decades.  These attorneys litigate all types of antitrust cases, including class actions in diverse industries such as pharmaceuticals, agricultural products and insurance. Following is a small sampling of that experience.

Selected Representations 

• Sonnenschein, acting as part of a two-firm defense team, defeated class certification for Monsanto Company in federal antitrust litigation regarding the company’s pricing of its genetically modified soybean seed products (“Roundup Ready” soybeans).  The team had successfully invoked a forum selection clause to obtain transfer of the putative national class out of the Southern District of Illinois to the Eastern District of Missouri (St. Louis) and then defeated certification of a nationwide class.   Judge Sippel’s lengthy decision denying class followed a year of discovery on class certification issues and a two-day evidentiary hearing.  Sonnenschein also has been selected as one of three defense firms and trial counsel in 14 separate class actions--in which Monsanto is a defendant--that have been consolidated before the U.S. District Court for the Eastern District of Missouri.
• Sonnenschein obtained a full dismissal for Allstate Insurance Company in Gilchrist v. State Farm, a Sherman Act conspiracy case alleging that the defendants’ agreement regarding the sourcing of automobile repair parts was an anti-competitive act that raised the price of automobile insurance nationwide.  The district court certified a class of more than 70 million policyholders, perhaps the largest class ever certified. Defendants obtained leave from the U.S. Court of Appeals for the Eleventh Circuit to take an interlocutory appeal, in which Sonnenschein had a leading role.  The appellate court dismissed the entire action as barred under the statutory antitrust exemption for insurance under the McCarran Ferguson Act.
• In other antitrust class actions for Allstate, Sonnenschein played a leading role in obtaining a summary judgment ruling for the defendants in the trial court and negotiating a settlement that avoided trial on the remaining issues.  Those class actions involved claims by 19 state attorneys general against major insurers and reinsurers alleging a “global conspiracy” to reduce coverage and raise prices of commercial general liability insurance.
• Sonnenschein represented Knoll Pharmaceutical Company, a former subsidiary of BASF Corporation, in the coordinated defense of federal and state class actions alleging a conspiracy among pharmaceutical manufacturers and wholesalers to deny to retail pharmacies the discounts provided to hospitals and HMOs.  Sonnenschein obtained settlement of all cases at significant discounts.
• Sonnenschein served as national coordinating counsel to Royal & SunAlliance in a series of federal and state class actions across the country involving alleged antitrust, common law fraud, and RICO violations with respect to workers’ compensation retrospective premiums.  In many of these cases, either Royal successfully moved for dismissal, or class certification was denied.  In a particularly significant victory for our client, the U.S. Court of Appeals for the Fifth Circuit, in a seminal decision, reversed the certification of a nationwide RICO fraud class certified by the Southern District of Texas.  In reversing certification, the court held, among other things, that individualized issues regarding proximate cause and reliance would swamp any common issues.  Shortly after this victory, these cases settled on a nationwide basis.
• Sonnenschein represented Rush University Medical Center in a putative nationwide class action alleging a conspiracy to reduce the “wages” paid to medical residents.  The suit named as defendants more than two dozen hospitals and medical schools that sponsor residency programs, as well as a variety of associations involved in graduate medical education.  The trial court’s dismissal of the action was affirmed on appeal.
• Sonnenschein defended McLeod USA in a class action alleging that telecommunications providers’ agreements to provide services to state prisons violated antitrust law. The district court granted the defendants’ motion to dismiss, which the Seventh Circuit affirmed with modification.

Ongoing Class Action Matters

Sonnenschein remains at the forefront of antitrust class action work, representing clients in recent, cutting-edge cases.  For example, considerable publicity surrounds antitrust suits filed in several cities around the country asserting claims of different conspiracies among hospitals to suppress the amount of nurses’ compensation. Sonnenschein is actively involved in these cases:

• Sonnenschein represents University Medical Center, an academic medical center in Tucson in an antitrust class action filed in federal district court in Phoenix, alleging that the Arizona Hospital & Healthcare Association and many of its member hospitals conspired to fix the rates paid for temporary nursing services through participation in the hospital association’s nurse registry program.  Class certification motions will be heard in early 2009.
• Sonnenschein represents the University of Chicago Hospitals in a case filed by a consortium of plaintiffs’ class action attorneys in federal district court in Chicago alleging a conspiracy among defendant hospitals to suppress nurse wages.
• Sonnenschein represents Trinity Health Corp. in a class action filed by the same consortium of plaintiffs’ class action attorneys in the federal district court in Detroit.  That complaint also alleges that defendant hospitals conspired to suppress nurse wages.
• Sonnenschein represents Kansas City Southern Railway, which has been sued along with other U.S. Class 1 railroads in widely publicized class actions filed in various U.S. district courts.  The actions seek damages from an alleged price-fixing conspiracy involving the establishment and maintenance of fuel surcharges.  The cases have been transferred for consolidated pretrial proceedings to the U.S. District Court for the District of Columbia.