Opinion
CIVIL ACTION NO. 03-2038.
August 31, 2006
MEMORANDUM OPINION
Presently before the Court are plaintiffs' motion for class certification (Doc. No. 213), defendants' responses in opposition to plaintiffs' motion for class certification (Doc. No. 239-241), plaintiffs' reply brief in further support of class certification (Doc. No. 253), defendants' joint motion for an evidentiary hearing (Doc. No. 255), plaintiffs' memorandum in opposition to defendants' motion for an evidentiary hearing (Doc. No. 256), and defendants' reply brief in further support of an evidentiary hearing (Doc. No. 260).
For the following reasons, the Court denies defendants' motion for an evidentiary hearing; and grants plaintiffs' motion for class certification upon condition that plaintiffs divide the proposed class into six subclasses.
I. Factual and Procedural History
This case involves class action allegations of a price-fixing conspiracy within the plastics additives' industry. Defendants Rohm Haas Company ("Rohm Haas"), Arkema Inc. ("Arkema"), Mitsubishi Rayon America, Inc. ("Mitsubishi"), Ferro Corporation ("Ferro"), Kreha Corporation of America ("Kreha"), Akcros Chemicals America ("Akcros"), Akzo Nobel, Inc. ("Akzo"), Baerlocher USA, LLC ("Baerlocher"), Kaneka Texas Corporation ("Kaneka"), Dow Chemical Company ("Dow"), and Union Carbide Corporation ("Union Carbide") (collectively "defendants") are alleged manufacturers and/or sellers of plastics additives. (See Second. Cons. Am. Compl., at ¶¶ 17-27). Plaintiffs Isaac Industries, Inc. ("Issac"), Newline Color Inc. ("Newline"), Crane Group Co. ("Crane Group"), Crane Plastics Company LLC ("CPC"), Crane Plastics Manufacturing Ltd. ("CPM"), Crane Plastics Siding LLC ("CPS"), Crane Products Ltd. ("CP"), TimberTech Limited ("TimberTech"), Ex-Tech Plastics, Inc. ("Ex-Tech"), and Heritage Plastics, Inc. ("Heritage") (collectively "plaintiffs") are alleged purchasers of plastics additives. (Id., at ¶¶ 7-16). Plaintiffs seek to represent a nationwide class of purchasers of plastics additives for the time period of January 1, 1990 through December 31, 2003. (Id., at ¶ 1). Plaintiffs define plastics additives as "heat stabilizers, impact modifiers, and processing aids used to manufacture or process plastics." (Id., at ¶ 6).
Specifically, plaintiffs' proposed class definition reads as follows:
All persons (excluding governing entities, Defendants, other producers of Plastics Additives, and the present and former parents, subsidiaries and affiliates of the foregoing) who purchased heat stabilizers, impact modifiers or processing aids in the United States directly from Crompton Corporation or any of the Defendants formerly, currently, or subsequently named in the action or from any predecessor, parents, subsidiaries or affiliates thereof at any time during the period form January 1, 1990 to and including January 31, 2003.
(See Pl. Br., at 1).
Plaintiffs contend that defendants violated Section 1 of the Sherman Act, 15 U.S.C. § 1, by engaging in a conspiracy in restraint of trade to raise, fix, and/or stabilize prices for plastics additives in the United states. (Id. at ¶¶ 31-38, 46-48). Plaintiffs further allege that they had no knowledge of the conspiracy because defendants fraudulently concealed it. (Id. at ¶ 49-51). As a result, plaintiffs allege that they and other members of the class were required to pay more for plastics additives than they would have paid in a competitive marketplace. (Id. at ¶ 52-54).
The parties commenced class-related and merits-related discovery on November 30, 2004. (See Doc. No. 106). Following the completion of fact-based class certification discovery, plaintiffs filed a motion for class certification on August 4, 2005. (See Doc. No. 213). Expert-based class certification discovery ensued, and defendants filed responses to plaintiffs' motion for class certification on November 18, 2005. (See Doc. No. 239-241). On March 3, 2006, plaintiffs filed a reply memorandum in further support of their motion for class certification. (See Doc No. 253).
Rohm Haas, Arkema, Mitsubishi, Ferro, Kreha, Akcros, Akzo, Baerlocher USA, and Kaneka filed a joint memorandum in opposition to plaintiffs' motion for class certification. (See Doc. No. 240-241). Dow and Union Carbide filed a separate memorandum of law. (See Doc. No. 239).
II. Discussion
Plaintiffs have filed a motion for class certification, and defendants have requested an evidentiary hearing. The Court first resolves defendants' motion for an evidentiary hearing.
A. Motion for Evidentiary Hearing
Defendants jointly request an evidentiary hearing on the issue of class certification to resolve "the numerous and significant factual disputes evident from the affidavits submitted in support of and in opposition to Plaintiffs' motion for class certification." (See Def. Br. In Support of Evid. Hearing, at 1).
The Court denies defendants' motion for an evidentiary hearing. First, the Court finds that the record is appropriately complete for the Court to make a class certification determination without the need for an evidentiary hearing; both sides have extensively briefed and supported their positions. See DeLoach v. Philip Morris Co., 206 F.R.D. 551, 552 n. 2 (M.D.N.C. 2002) (finding that evidentiary hearing on class certification is "unnecessary," as "both parties have thoroughly briefed their positions"); Gould v. Sullivan, 131 F.R.D. 108, 113 (S.D. Ohio 1989) (evidentiary hearing on class certification "unnecessary" because parties "have submitted adequate evidentiary materials and arguments" with respect to relevant requirements of Rule 23);Stolz v. United Brhd. of Carpenters and Joiners of Am., 620 F. Supp. 396, 402 (D. Nev. 1985) (court need resort to evidentiary hearing " only where the record is insufficient to make the determination") (emphasis added). Second, the Court concludes that, due to the length of class-related discovery and the thoroughness of the parties' briefs, exhibits, and expert submissions, any benefit associated with an evidentiary hearing will be outweighed by the time and expense of such a hearing, which has the potential to turn into a mini-trial on the validity of the conclusions of the parties' class certification experts. Third, the Court finds that an evidentiary hearing will yield no benefit: defendants' justification for requesting the evidentiary hearing, to allow the Court to resolve factual and credibility disputes between the parties' experts, presents a methodology which courts uniformly reject in making class certification determinations. See In re Vitamins Antitrust Litig., 209 F.R.D. 251, 267-268 (D.D.C. 2002); In re Linerboard Antitrust Litig., 203 F.R.D. 192, 217 n. 13 (E.D. Pa. 2001); In re Indus. Diamonds Antitrust Litig., 167 F.R.D. 374, 384 (S.D.N.Y. 1996).
B. Motion for Class Certification
Plaintiffs bear the burden of satisfying each of the prerequisites of class certification. See Baby Neal v. Casey, 43 F.3d 48, 55 (3d Cir. 1994); Shwartz v. Dana Corp., 196 F.R.D. 275, 279 (E.D. Pa. 2000). Rule 23(a) and Rule 23(b)(3), the elective procedural provision under which plaintiffs seek certification, identify six prerequisites to the certification of a class action: (1) numerosity — the class is so numerous that joinder of all members is impracticable; (2) commonality — the class shares common questions of law or fact; (3) typicality — the claims or defenses of the representative parties are typical of the claims or defenses of the class; (4) adequate representation — the representative parties will fairly and adequately protect the interests of the class; (5) predominance — questions of law or fact common to the members of the class predominate over any questions affecting only individual members; and (6) superiority — a class action is superior to other available methods for the fair and efficient adjudication of the controversy. See Fed.R.Civ.P. 23. In addition, implicit in the requirements of Rule 23 is that a proposed class definition be ascertainable — it must be precise and objectively verifiable, rather than dependent upon subjective criteria or extensive factual analysis. See Linerboard, 203 F.R.D. at 221; In re Copper Antitrust Litig., 196 F.R.D. 348, 353 (W.D. Wis. 2000).
1. Numerosity
The numerosity element of class action certification does not require joinder to be impossible, only impracticable. See, e.g.,In re Flat Glass Antitrust Litig., 191 F.R.D. 472, 477 (W.D. Pa. 1999). In the antitrust context, a proposed class of hundreds of members "routinely" satisfies the numerosity requirement. Id.
The Court finds that plaintiffs meet the numerosity prong of class certification. Plaintiffs submit, without objection, that there were at least hundreds of direct purchasers of plastics additives during the class period. (See Pl. Br., at 8; Beyer Aff., attached as Ex. A to Pl. Br., at ¶ 25). Common sense dictates that these purchasers were dispersed throughout the nation. See, e.g., In re Rubber Chemicals Antitrust Litig., 232 F.R.D. 346, 351 (N.D. Cal. 2005) ("the fact that a class is geographically dispersed, and that class members are difficult to identify, supports class certification"). Furthermore, the Court notes that defendants do not challenge plaintiffs' satisfaction of the numerosity prerequisite for class certification.
2. Commonality
The commonality requirement is "easily met." See Baby Neal v. Casey, 43 F.3d 48, 56 (3d Cir. 1994); Vitamins, 209 F.R.D. at 259. This requirement is satisfied if the "named plaintiffs share at least one question of fact or law with the grievances of the prospective class." Stewart v. Abraham, 275 F.3d 220, 227 (3d Cir. 2001).
The Court finds that plaintiffs satisfy the commonality prong of class certification. Plaintiffs allege a series of legal and factual questions common to the class: that defendants conspired to raise, fix, and/or maintain the prices of plastics additives through horizontal agreements; that defendants fraudulently concealed their conspiracy from plaintiffs and the proposed class members; and that plaintiffs and the proposed class members paid supra-competitive prices for plastics additives. (See Sec. Am. Con. Compl., at ¶¶ 43-54); see, e.g., Bogosian v. Gulf Oil Corp., 561 F.2d 434, 454 (3d Cir. 1977) (existence of conspiracy constitutes common question of law and fact); Flat Glass, 191 F.R.D. at 479 (allegations concerning existence, scope, and efficacy of alleged conspiracy satisfy commonality analysis). Moreover, although not dispositive of the issue, the Judicial Panel on Multidistrict Litigation found that the alleged actions of defendants present common issues of fact. (See MDL Order); see Vitamins, 209 F.R.D. at 259-260 (using findings of Judicial Panel on Multidistrict Litigation to bolster commonality determination). Finally, defendants do not dispute that common questions of fact and law extend throughout the proposed class.
3. Typicality
The typicality prong of class certification evaluates whether "the named plaintiff's individual circumstances are markedly different or . . . the legal theory upon which the claims are based differs from that upon which the claims of other class members will perforce be based." Eisenberg v. Gagnon, 766 F.2d 770, 786 (3d Cir. 1985) (internal quotations omitted). Additional claims by class representatives do not render their claims atypical of the class; instead, the claim need only arise from the same "practice or course of conduct that gives rise to the claims of the class members" and be "based on the same legal theory." Hoxworth v. Blinder, Robinson Co., Inc., 980 F.2d 912, 923 (3d Cir. 1992). Furthermore, "even relatively pronounced factual differences will generally not preclude a finding of typicality where there is a strong similarity of legal theories."Baby Neal, 43 F.3d at 58.
It is clear that plaintiffs' claims are typical of the claims of the proposed class members. The named plaintiffs, like the proposed class members, allege injury arising from defendants' conspiracy to raise prices within the plastics additives' industry, in violation of § 1 of the Sherman Act. (See Sec. Cons. Am. Compl., at ¶¶ 2, 46-48); see Carbon Black, 2005 WL 102966, at *12 (D. Mass. Jan. 18, 2005) (typicality prong satisfied in antitrust litigation when plaintiffs, on behalf of themselves and other purchasers of carbon black, allege injury due to artificial price increases caused by defendants' price-fixing agreement);Flat Glass, 191 F.R.D. at 480 (typicality prong satisfied in antitrust litigation when named plaintiffs allege that they and other proposed class members were injured due to market-wide price fixing scheme perpetuated by defendants). Although plaintiffs purchased different products within the plastics additives' market, used different purchase methods, and paid different prices for these products, this diversity does not defeat the presence of typicality, as the injury suffered by the class representatives and the proposed class members allegedly originated from the common wrong of defendants' price-fixing agreement(s). Id.; see also Vitamins, 209 F.R.D. at 261. Finally, the Court notes that defendants do not challenge plaintiffs' satisfaction of the typicality prong of the class certification analysis.
4. Adequacy of Representation
A class representative is adequate if: (a) the class representative's counsel is competent to conduct a class action; and (b) the class representative's interests are not hostile to those of the class. See, e.g., Newton v. Merrill Lynch, Pierce, Fenner Smith, Inc., 259 F.3d 154, 185 (3d Cir. 2001).
The Court finds that counsel for the proposed class representatives possess the requisite skill and resources to litigate this class action suit. Indeed, plaintiffs' counsel repeatedly has been deemed competent to prosecute class actions based upon antitrust violations. (See Firm Resumes, attached as Ex. C-F of Pl. Mot. For Class Cert.).
The Court also finds that the interests of the class representatives are not antithetical to those of the class. Although defendants' economic expert, David P. Kaplan ("Kaplan"), suggests in his report that a conflict may materialize between the interest of certain class representatives in pursuing a particular type of damages theory (i.e., lost profits) and the interest of putative class members in pursuing a different type of damages theory (i.e., overcharge), depending upon the purchaser's function within the chain of distribution (i.e., as chemical resellers, base resin manufacturers, custom compounders, or plastic fabricators), defendants do not advance this argument in their briefs. (See Kaplan Aff., attached as Ex. A to Joint Def. Br., at ¶¶ 140-144; Beyer Aff., at ¶¶ 23-24). Nor is this argument particularly persuasive, as it is not based upon an imminent conflict which undermines the proposed class representatives' vigor to pursue the claims of the class as a whole, but, instead, upon speculation as to future disagreement over the appropriate type of damages to seek at trial. See Bulk [Extruded] Graphite, 2006 WL 891362, at *8 (granting class certification because potential conflicts between proposed class representatives and proposed class members were not "apparent, imminent, and so palpable as to outweigh the substantial interest of every class member in proceeding with the litigation"). In fact, plaintiffs preempt the possible materialization of this conflict, representing that all members of the class will be seeking overcharge damages. (See Pl. Reply Br., at 41). Finally, if tension does develop between class representatives and class members concerning the appropriate theory of damages, the Court has the power to bifurcate liability and damages or to decertify the class after a liability hearing.
5. Predominance
The predominance prong is met "when there exists generalized evidence which proves or disproves an element on a simultaneous, class-wide basis, since such proof obviates the need to examine each class member's individual position." In re Potash Antitrust Litig., 159 F.R.D. 682, 693 (D. Minn. 1995). In other words, satisfaction of the predominance prong of the class certification standard does not require plaintiffs to provide evidence establishing each element of their cause of action at the class certification stage, but, instead, requires plaintiffs to make a threshold showing that each element of their claim may be proven through common, class-wide evidence, rather than through evidence particular to each member of the class. See, e.g., Bulk [Extruded] Graphite, 2006 WL 891362, at *10. According to the Supreme Court, the predominance test is "readily met" in antitrust litigation. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623, 625 (1997); see 6 Newberg on Class Actions § 18:25 (4th ed. 2006) (noting that requirement of predominance "has been met with relative ease by the great majority of antitrust class action plaintiffs").
To prevail on their price-fixing claims under § 1 of the Sherman Act, plaintiffs must prove three elements: (1) a conspiracy to fix prices in violation of the antitrust laws; (2) the impact of the unlawful activity; and (3) the amount of damages sustained as a result of the unlawful activity. See,e.g., Vitamins, 209 F.R.D. at 257; Linerboard, 203 F.R.D. at 214. For plaintiffs to recover on their price-fixing claims beyond the four year limitation period, plaintiffs must demonstrate that defendants fraudulently concealed the alleged conspiracy, thereby tolling the limitation period. (See Pl. Con. Am. Compl., at ¶¶ 49-51). Common proofs must therefore predominate over individualized evidence at to these four issues. See, e.g., In re Citric Acid Antitrust Litig., 1996 WL 655791, at *6 (N.D. Cal. Oct. 2, 1996) ("plaintiffs' burden is to establish that common or generalized proof will predominate at trial with respect to these three essential elements of their antitrust claim") (internal citations omitted).
a. Price-Fixing Conspiracy
Plaintiffs splinter the plastics additives' industry into six non-interchangeable segments: organotin heat stabilizers; mixed metal heat stabilizers; epoxidized soybean oil ("ESBO"); methacrylate butadiene styrene ("MBS") impact modifiers; acrylic impact modifiers; and acrylic processing aids. (See Beyer Aff., at ¶ 15). Despite this segmentation, plaintiffs argue that they satisfy the predominance prong as to the conspiracy element of their antitrust claim because they allege a single, overarching conspiratorial agreement to inflate prices for each product identified in each segment. (See Pl. Reply Br., at 28-31).
Defendants argue that plaintiffs have failed to put forth any evidence in support of their allegation of a single, price-fixing conspiracy applicable to all members of the proposed class. (See Joint Def. Br., at 23-25). Defendants also argue, based in part upon Beyer's identification of the six separate and non-interchangeable "segments" of the plastics additives' industry, that plaintiffs' alleged price-fixing conspiracy really involves multiple participants, multiple agreements, and, in essence, multiple conspiracies. (Id.). In turn, because each agreement will only apply to the plastics additives' segment covered by the agreement, each plaintiff will be proving the existence of the conspiracy, or multiple conspiracies, through individualized evidence. (Id.; Dow/Union Br., at 7-12).
The Court finds that plaintiffs have not met their burden of showing the predominance of common proof of a single, class-wide conspiracy, but, instead, that plaintiffs' evidence at the class certification stage supports a theory of establishing multiple, segment-specific conspiracies through segment-wide proof. Several reasons support this conclusion. First, plaintiffs offer virtually no class-wide evidence at the class certification stage from which the Court could conclude that class-wide issues will predominate over individualized issues with respect to the conspiracy element of plaintiffs' price-fixing claim; nor do plaintiffs identify a particular method for establishing a single, class-wide conspiracy in light of plaintiffs' segmentation of the plastics additives' industry. See Vitamins, 209 F.R.D. at 265 (plaintiffs' allegations of single overarching conspiracy, evidence of defendants' guilty pleas, and results of discovery to date satisfy plaintiffs' burden of showing that they "will introduce generalized evidence, common to the class, in attempting to prove the alleged conspiracy and that this will predominate"); In re Domestic Air Trans. Antitrust Litig., 137 F.R.D. 677, 685 (N.D. Ga. 1991) (noting that predominance inquiry in horizontal price-fixing action requires court to "examine the proof plaintiffs propose to submit to determine if it is the type necessary to establish a common conspiracy by all defendants" and finding that predominance prong is met when plaintiffs present "considerable amount" of evidence, common to class, concerning alleged antitrust violation and when there is no indication that plaintiffs plan to proceed market by market in effort to establish many different conspiracies). Second, plaintiffs' offer of proof in support of the conspiracy, indeed, plaintiffs articulated strategy for establishing a violation of § 1 of the Sherman Act, is primarily segment-specific: that groups of defendants dominated each of the six product segments during the class period; that multiple defendants issued price increase announcements within each segment during the class certification period; and that price increases of products within each segment occurred simultaneous with or shortly following the price announcements. (See Beyer Aff., at ¶¶ 41, 72-76; Price Documentation, attached as Ex. 122-140 to Def. Br.). Third, plaintiffs' evidence demonstrates the absence of any economic motivation for a class-wide conspiracy implicating all defendants; indeed, because the segments are non-interchangeable and because none of the defendants operated in all segments, a defendant selling a particular product in a particular product segment would have had no incentive to conspire with other, non-competitor defendants in another product segment to raise prices for all products across all six segments. (See Beyer Aff., at ¶¶ 37, 43-49; Beyer Dep., attached as Ex. A to Dow's Br., at 193-196; Kaplan Aff., attached as Ex. A to Def. Br., at Table 1). In fact, at least one defendant, Dow, operated only within one segment, ESBO, but purchased products in all other segments for use in its manufacturing processes. (See Dow Sales Data, attached as Ex. E to Dow/Union Br.). In other words, based upon the evidence presented in conjunction with plaintiffs' class certification motion, principles of micro-economics suggest that plaintiffs will attempt to establish the existence of a series of segment-specific conspiracies through evidence of certain defendants' conduct within each product segment/market. Fourth, as discussed below, plaintiffs' expert, Dr. John Beyer ("Beyer"), demonstrates the availability of segment-wide, rather than class-wide, proof of both impact and damages, thereby highlighting the unique, microeconomic characteristics of each segment/market. (See Beyer's Aff., attached as Ex. A to Pl. Br., at ¶¶ 63-71, 81-82; Beyer's Reply Aff., attached as Ex. 1 to Pl. Reply Br., at ¶¶ 53-72). Finally, plaintiffs' voluntary segmentation of the plastics additives' industry into six distinct markets, the absence of class-specific evidence, or of a strategy of presenting class-specific evidence, of an overarching conspiracy, and the testimony of plaintiffs' expert both as to the non-substitutability of products across product segments and as to the inability to calculate impact and damages for purchasers across product segments distinguishes this litigation from other cases in which courts have been willing to infer the predominance of common, class-wide proof from the mere allegation of a single, class-wide price-fixing conspiracy within a particular industry. See, e.g., Flat Glass, 191 F.R.D. at 485 (finding predominance of common evidence of price-fixing conspiracy based upon allegation of single conspiracy, but noting that plaintiffs' amended complaint "references internal documents submitted by defendants, details conversations wherein defendants allegedly discussed price fixing with others, and provides statements and conduct alleged made and undertaken by former employees, which will not vary among the class members").
The lone piece of class-wide evidence appears to be the January 31, 2006 deposition of Nirmal Jain, the Vice President of the Polymer Additives Division of Crompton until 1998, who invoked his Firth Amendment privilege against self-incrimination to refuse to answer questions about alleged meetings with defendants regarding pricing for all segments of the plastics additives' industry. (See Jain Dep., attached as Ex. 2 to Pl. Reply Br., at 22-49, 58).
In summary, the Court finds that plaintiffs' expert testimony, plaintiffs' brief, and plaintiffs' evidence at the class certification stage suggest that plaintiffs will attempt to prove a series of segment-specific conspiracies through proof common to each segment. This methodology, however, does not trigger the denial of class certification. See 7AA Wright, Miller, Kane, Fed. Prac. Proc. § 1790, at 587 (3d. ed. 2005) (noting that court should utilize Rule 23(c)(4) to remedy problems with proposed class definition in plaintiffs' complaint). Instead, the Court finds that if plaintiffs' proposed class is divided into six subclasses pursuant to Rule 23(c) of the Federal Rules of Civil Procedure, plaintiffs meet their burden of establishing that the common question of the existence of a conspiracy within each subclass will predominate over individualized issues. See Bulk [Extruded] Graphite, 2006 WL 891362, at *9 (allegation that defendants fixed prices for bulk extruded graphite products at artificially high levels satisfies Rule 23(b)(3) requirement because it requires common, class-wide proof of existence of conspiracy); 7AA Wright, Miller, Kane, Fed. Prac. Proc. Civ. § 1781, at 248 ("since antitrust actions typically present many complicated issues, the courts should utilize subdivisions (c) and (d) to structure the action so as to settle the common issues on a representational basis to avoid congesting the courts with separate actions requiring the repetitive adjudication of the same matters").
b. Impact
Defendants vociferously argue that the plastics additives' industry is so complicated, fragmented, and multi-dimensional that individual proof of impact will predominate over generalized proof of class-wide impact. (See Joint Def. Br., at 25-43). Specifically, defendants argue that the following market-unique factors require plaintiffs to use individual, rather than common, proof to establish class-wide impact: (1) lack of product substitutability; (2) pervasive presence of potential substitute products and technologies from non-defendants; (3) fragmented supply structure among plastics additives' manufacturers; (4) highly individualized purchasing practices of members of the proposed class; and (5) individual pricing issues raised by transactional data. (Id.; Dow/Union Br., at 13-16).
In response, plaintiffs present Beyer's affidavit testimony. Accepting the conspiracy allegations in the complaint as true, Beyer concludes that impact and damages can be demonstrated through class-wide proof, indeed, that all members of the proposed class would have been impacted by the conspiracy. Beyer predicates this conclusion upon four specific characteristics of the plastics additives' industry. First, Beyer represents that price is the primary factor affecting buying decisions within the plastics additives' industry, as there is a high degree of exchangeability of products within each segment, as defendants are "relatively undifferentiated" in their services and reliability within each segment, and as supplier location is largely irrelevant in customer buying decisions. (See Beyer Aff., at ¶¶ 33-40; Beyer Reply Aff., at ¶¶ 10-21). Second, Beyer adds that it would have been "nearly impossible" for purchasers to avoid the impact of the conspiracy by obtaining plastics additives from non-defendants at prices lower than those maintained by the alleged conspiracy due to defendants' control of a large share of each of the six product segments and to the absence of viable economic substitutes for products within each segment. (See Beyer Aff., at ¶¶ 41-50; Beyer Reply Aff., at ¶¶ 28-44). Third, Beyer notes that the plastics additives' industry lends itself to unrestrained price competition, which would have driven down the price of plastics additives in the absence of a conspiracy; Beyer bases this assertion upon the existence of multiple suppliers which produce, or have the capacity to produce, products that meet customer specifications within each product segment, the national availability of plastics additives and the concomitant absence of regional pricing differences, and the primacy of price in influencing purchaser decision-making. (See Beyer Aff., at ¶¶ 51-55; Beyer Reply Aff., at ¶¶ 22-27).
Finally, Beyer identifies a "pricing structure" within each of the six segments of the plastics additives' industry. The existence of this pricing structure, in which average prices of plastics additives move together over time in response to market and non-market forces, means that an alleged conspiracy would have raised all prices across the nation within each segment, that class members within each segment would have paid similar "artificial price premiums" due to the conspiracy. (See Beyer Aff., at ¶¶ 56-71; Beyer Reply Aff., at ¶¶ 59-65). To ascertain whether the plastics additives industry was subject to a pricing structure, Beyer used multiple regression analysis to map the price movement for (a sample of) the most popular products, and, if possible, their substitutes, sold by defendants to the largest purchasers during the class period, while controlling for the various factors affecting transaction prices. (See Beyer Aff., at ¶¶ 56-71; Beyer Reply Aff., at ¶¶ 53-58). Beyer's results, in the form of charts and statistical evidence, suggest the existence of a commonality of movement of product prices within each segment. (Id.). Offering additional support for the existence of such a pricing structure, Beyer cites fifty occasions between January 1990 and January 2003 on which multiple defendants made price announcements increasing the price of products within the six segments of plastics additives; these price increases often went into effect simultaneously or within short time intervals, thereby demonstrating that proposed class members would have been similarly impacted by the alleged conspiracy, regardless of the defendant/supplier from which they purchased. (See Beyer Aff., at ¶¶ 71-76; Beyer Reply Aff., at ¶ 50). The existence of a pricing structure, according to Beyer, is then further confirmed by evidence of national price lists for certain products within each of the six segments and of a causal nexus between these list prices and the price increase announcements. (See Beyer Reply Aff., at ¶ 51).
Dr. Beyer notes that the effect of prince announcements of similar magnitude and timing need not be to increase actual transaction prices by the same amount contained in the announcements, but, instead, may serve to maintain a certain price level or to keep prices from decreasing as they would in a competitive market. (See Beyer Reply Aff., at ¶ 50).
Beyer's affidavit testimony satisfies plaintiffs' burden of demonstrating the predominance of generalized evidence of class-wide impact over individualized evidence, so long as plaintiffs' proposed class is broken into subclasses corresponding to each of Beyer's six segments of the plastics additives' industry. See Bogosian, 561 F.2d at 455 (endorsing strategy of designating subclasses to account for pricing variations within product industry). Put another way, the Court finds that plaintiffs' methodology for establishing impact involves segment-specific, rather than class-wide, evidence. For instance, Beyer's identification of a national pricing structure, with minimal regional pricing differences, for a sampling of products in each plastics additives' category constitutes common proof that a price-fixing conspiracy, to the extent one existed, would have generated class-wide impact for plaintiffs within each segment of the plastics additives' industry. (See Beyer's Aff., at ¶ 71) ("prices for different products within each of the six product segments . . . respond similarly to market and non-market forces"); see, e.g., Bogosian, 561 F.2d at 455 ("If the price structure in the industry is such that nationwide the conspiratorially affected prices at the wholesale level fluctuated within a range which, though different in different regions, was higher in all regions than the range which would have existed in all regions under competitive conditions, it would be clear that all members of the class suffered damage, notwithstanding that there would be variations among all dealers at to the extent of their damage . . . Under these circumstances proof on a common basis would be appropriate."); Potash, 159 F.R.D. at 695 ("because the gravamen of a price-fixing claim is that the price in a given market is artificially high, there is a presumption that an illegal price-fixing scheme impacts upon all purchasers of a price-fixed product in a conspiratorially affected market"). Nor is Beyer's analysis of the pricing structure within each segment of the plastics additives' industry speculative: it is based upon multiple regression analysis, a technique frequently utilized to establish class-wide impact, and is supported by statistical data and by graphs and charts which map this data in a comprehensive and persuasive manner. See, e.g., In re Linberboard, 305 F.3d 145, 155 (3d Cir. 2002) (finding that antitrust plaintiffs seeking class action certification could establish injury on class-wide basis because plaintiffs produced affidavits of expert witnesses, including charts and exhibits, to authenticate professional opinions that all class members would incur such damages); Flat Glass, 191 F.R.D. at 487 (predominance prong satisfied at to impact when plaintiffs present expert testimony that multiple regression analysis can establish fact of damage for proposed subclasses). Furthermore, Beyer produces other segment-wide evidence to suggest impact, including multiple defendant price announcements within each segment, price lists (which were allegedly collusively set) for certain products within each segment, defendants' responsibility for 90% or more of sales within each segment, the absence of viable substitutes (untainted by the alleged conspiracy) for products within each segment, and the primacy of price in purchaser decision-making.See Bulk [Extruded] Graphite, 2006 WL 891362, at *13 (finding that plaintiffs adduced sufficient evidence that class-wide impact may be shown through generalized, class-wide evidence when plaintiffs' expert concludes that all class members would have paid higher prices for product than they would have absent alleged conspiracy, a conclusion based upon pricing structure within industry, as confirmed through multiple regression analysis, price lists, and price announcements, and upon defendants' responsibility for 80% of industry sales); Rubber Chemicals, 232 F.R.D. at 352 ("class-wide impact is usually found to exist where the defendants are shown to have used collusively-set list prices for the product at issue"). Finally, Beyer offers no affidavit testimony to dispute Kaplan's conclusion that, based upon the available transactional data, over 700 proposed class members purchased products from defendants within only one of the segments of the plastics additives' industry; these purchasing practices suggest that proof of impact will be established on a segment-by-segment basis, through evidence common to all purchasers within a particular segment rather than to all purchasers across all segments. (See Kaplan Aff., at ¶ 13).
Many courts presume impact in cases involving allegations of horizontal price-fixing in a market subject to an identifiable, nation-wide price structure. See Linerboard, 203 F.R.D. at 217. This Court need not rely upon this presumption due to the evidence presented in and through Beyers' affidavit testimony.See Vitamins, 209 F.R.D. at 266.
In finding that plaintiffs have met their burden of showing the predominance of segment-wide proof to establish impact, the Court rejects defendants' contention that the diversity and non-substitutability of products within the plastics additives' industry, the fragmentation of supply and demand structures, and plaintiffs' individualized purchasing practices precludes proof of impact through a common body of evidence. See, e.g., Bulk [Extruded] Graphite, 2006 WL 891362, at *11 (although antitrust defendants resisting class certification "routinely" argue that the complexity of their particular industry makes it impossible for common proofs to predominate on the issue of antitrust impact, "courts have frequently found common impact in cases alleging price-fixing, despite the presence of individualized negotiations, varied purchase methods and different amounts, prices, and types of products purchased"). This argument has been repeatedly dismissed by courts in favor of granting class certification in antitrust price-fixing cases, at least when plaintiffs present expert testimony substantiating the feasability of establishing class-wide impact through generalized proof. See, e.g., Carbon Black, 2005 WL 102966, at *16 (crediting conclusions of plaintiffs' expert regarding sufficiency of evidence of common impact and reasoning that "[i]ndividualized negotiations and a diversity of prices paid, however, do not automatically foreclose class action treatment"); Vitamins, 209 F.R.D. at 264, 267 (crediting conclusions of plaintiffs' expert as to viability of proving impact of conspiracy affecting vitamin products through class-wide evidence and noting that "[c]ourts have often rejected claims by defendants that the industry, pricing structure, and transactions with each other and with their customers are so complex, varied, fragmented, and diverse that common issues cannot predominate."); Flat Glass, 191 F.R.D. at 485-487 (impact prong satisfied through plaintiffs' presentation of viable method for proving class-wide impact in both subclasses, despite defendants' contention that varied products, markets, supply and demand considerations, and consumer bargaining influence render proof of impact an individualized endeavor); Citric Acid, 1996 WL 655791, at *7 (impact prong satisfied through plaintiffs' presentation of expert testimony articulating economic formula for measuring class-wide impact through common proof, despite defendants' contention that diversity of products, marketing practices, end uses, and pricing makes common proof of impact impossible); In re Aluminum Phosphide Antitrust Litig., 160 F.R.D. 609, 614-615 (D. Kan. 1995) (finding generalized proof of class-wide impact despite defendants' contentions that there are several types of products containing aluminum phosphide and that these products are sold in several different markets); In re Wirebound Boxes Antitrust Litig., 128 F.R.D. 268, 272 (D. Minn. 1989) (finding common proof of impact when plaintiffs offer testimony from economist indicating feasability of demonstrating uniform minimum level of inflation among all purchasers of wirebound boxes, despite defendants' contention that disparities within wirebound box industry, such as diversity in markets, pricing procedures, price negotiations, and costs of production, preclude proof of impact through class-wide evidence).
The Court also finds that defendants' introduction of expert testimony, which not only challenges Beyer's methodology for establishing a "pricing structure" within the plastics additives' industry, but also allegedly shows the existence of price diversity within and across each product segment, fails to defeat the propriety of class certification. See Bulk [Extruded] Graphite, 2006 WL 891362, at *14 (plaintiffs' satisfaction of predominance prong as to class-wide impact not defeated by opinions of defendants' expert that challenge validity of conclusions of plaintiffs' expert). Although this Court acknowledges the belief of defendants' economic expert, Kaplan, in the deficiencies of Beyer's methodology and conclusions, it is not appropriate at this stage to balance the credibility of the parties' experts. See Vitamins, 209 F.R.D. at 267-268 (refusing to engage in comparison of validity of contradictory expert conclusions in determining whether plaintiff shave made threshold showing of how they intent to prove impact through generalized evidence on class-wide basis); Indus. Diamonds, 167 F.R.D. at 384 (refusing to consider in detail defendant's expert affidavit challenging the methodology and conclusions of plaintiffs' expert concerning existence of generalized evidence of class-wide impact, as "it is for the jury to determine what weight to be given to the experts' conclusions"). Nor have defendants filed a Daubert-related motion to preclude this Court from considering Beyer's affidavit testimony. See Linerboard, 203 F.R.D. at 217 n. 13. Stated simply, defendants' detailed arguments challenge the weight to be ascribed to Beyer's testimony, a contestation that requires resolution by the finder of fact at trial, rather than by this Court at the class certification stage. See Flat Glass, 191 F.R.D. at 487 ("In light of the conflicting expert evidence presented, such arguments go to the weight of the testimony and must be resolved by the finder of fact"); Domestic Air Transp., 137 F.R.D. at 692 (finding predominance of common proof of class-wide impact despite defendants' challenges to economic analyses of plaintiffs' expert in part because "weight to be given his testimony and its effect is for the fact finder in assessing the merits of plaintiffs' claims at a later date").
In particular, defendants argue that Beyer failed to examine the actual prices for plastics additives against the price announcements, which were not joined by all plastics additives' manufacturers and which often exempted particular products, used incomplete sample data of purported price trends, failed to address pricing behavior within and across all segments, and simply lacked the requisite transactional data for the class period to reach the conclusions in his affidavits. (See Joint Def. Br., at 37-43). Defendants also provide the affidavit of their own expert, Kaplan, who, after reviewing and analyzing pricing data for products within the six plastics additives' segments, reached the opposite conclusion of plaintiffs' expert; Kaplan found the presence of price diversity, a wide variation in the chronological movement of the price of plastics additives, within and across each segment. (See Joint Def. Br., at 34-36). This contrary evidence, according to defendants' logic, precludes plaintiffs from demonstrating impact through generalized, as opposed to individualized, evidence.
c. Damages
The inquiry into whether common issues of damages will predominate over individual issues is limited at the class certification stage. Plaintiffs need only show the availability of a viable formula capable of proving damages on a class-wide basis. See Vitamins, 209 F.R.D. at 268. Furthermore, this methodology for establishing damages on a class-wide basis need not be devoid of individualized considerations, as courts have "routinely" held that "the need for individualized determinations of the putative class members' damages does not, without more, preclude certification of a class under Rule 23(b)(3)." Indus. Diamonds, 167 F.R.D. at 382; see also Aluminum Phosphide, 160 F.R.D. at 615 ("fact that individual proof as to the amount of damages may be necessary does not preclude class certification").
The Court finds that, so long as plaintiffs' proposed class is divided into six subclasses, with each subclass covering purchasers of products within one of Beyer's six product segments, plaintiffs have met their burden of showing that damage issues common to each subclass will predominate. For instance, Beyer proposes a separate and distinct damages' calculation for purchases of products within each of the six segments, based upon segment-specific factors affecting cost and demand. (See Beyer Aff., at ¶¶ 80-82). To calculate the amount of overcharge from the alleged conspiracy for class members in each of the six plastics additives' segments, Beyer advances a two-prong methodology: a before-during-and-after benchmark methodology coupled with multiple regression analysis. (Id., at ¶¶ 83-85). A before-during-and-after benchmark methodology identifies a benchmark period of time in which there was no alleged effort to coordinate prices, and then compares the prices of plastics additives between the benchmark and conspiracy period to reach a percentage overcharge. (Id., at ¶ 78). Separate multiple regression models, specific to each segment, are then used to control other non-conspiratorial factors affecting the price of plastics additives within each segment, such as the costs of inputs or changes in demand, thereby isolating the impact of the alleged conspiracy in terms of the resulting overcharge. (Id., at ¶¶ 84-87). Furthermore, Beyer proposes the utilization of a binary conspiracy variable, which would "capture any systematic difference in the prices of Plastics Additives during the alleged conspiracy that cannot be explained by the cost and demand variables in the multiple regression model;" this systematic difference is a measure of the overcharge, which is then applied to class member purchases within each segment to calculate damages. (Id., at ¶ 88; Beyer Reply Aff., at ¶¶ 73-78).
In this case, the benchmark period would be either a pre-1990 period or a post-2003 period. (See Beyer Aff., at ¶ 80).
Plaintiffs' methodology, if accepted by the factfinder at the appropriate stage in the litigation, "promises to provide precisely the kind of single mathematical formula which can establish each class member's damages." See Paper Systems Inc. v. Mitsubishi Corp., 193 F.R.D. 601, 616 (E.D. Wis. 2000). Indeed, this benchmark and multiple regression methodology has been accepted by numerous courts as satisfying the predominance inquiry. See, e.g., Rubber Chemicals, 232 F.R.D. at 354 ("benchmark" approach to calculating damages in antitrust litigation satisfies plaintiffs' burden of showing predominance of class-wide damages issues over individualized issues); Carbon Black, 2005 WL 102966, at *20 (finding that Beyer's "before-during-after" benchmark approach to assessing damages for class of purchasers of carbon black satisfies predominance inquiry into class-wide damages at class certification stage);Vitamins, 209 F.R.D. at 268 (finding that Beyer's multiple regression and industry benchmark analyses constitute viable methods of calculating damages on class-wide basis in satisfaction of predominance prong); Domestic Air Transp., 137 F.R.D. at 692-693. Furthermore, speculation that this methodology may ultimately fail to produce a valid calculation of segment-wide damages, with damage assessments descending into individualized inquiries without an overarching segment-wide methodological framework, does not justify denying class certification at this juncture; indeed, even if such a scenario did materialize, appropriate remedies would exist, such as severing damages from liability at trial, decertifying, altering, or amending the subclasses, or appointing special masters to preside over individual damage proceedings. See Carbon Black, 2005 WL 102966, at *20-21; Vitamins, 209 F.R.D. at 268; Linerboard, 203 F.R.D. at 220 (predominance prong as to damages in antitrust suit satisfied because plaintiffs' econometric methods can calculate damages on class-wide basis and because, if methodology fails, separate proceedings on damages can be held).
In reaching this conclusion, the Court again rejects defendants' arguments that the diversity of products, pricing, suppliers, supply and demand considerations, and consumers within the plastics additives' industry, the unavailability of data for portions of the proposed class period, and the availability of competitive products by numerous non-defendants preclude proof of damages on a class-wide basis. Courts often reject this line of reasoning at the class certification stage, finding that individualized considerations of damages do not justify denying class certification when liability can be determined on a class-wide basis. See Bogosian, 561 F.2d at 456; Potash, 159 F.R.D. at 697. Courts have been even more hostile to this type of argument when presented with a generally accepted methodology which attempts to account for such market-based variables. See,e.g., Aluminum Phosphide, 160 F.R.D. at 615 (plaintiffs' introduction of methodology of proving damages on class-wide basis satisfies predominance element as to class-wide damages, despite defendants' contention that pricing depends upon various individual factors, such as type of aluminum phosphide products, market in which products are used, quantity of products purchased, identity of purchaser, and availability of rebates, discounts, and credits).
In summary, plaintiffs have demonstrated that a viable methodology exists to calculate segment-wide damages, despite the presence of diverse, price-influencing variables within each segment. To reach an opposite conclusion over the testimony of plaintiffs' expert would effectively signal the demise of large-scale, class action antitrust litigation. See Carbon Black, 2005 WL 102966, at *21.
d. Tolling
Defendants have raised the four-year statute of limitations as an affirmative defense, and plaintiffs have alleged tolling of the limitations period based upon the doctrine of fraudulent concealment. (See Second Con. Am. Compl., at ¶¶ 49-51).
The Court finds that common issues of concealment will predominate over individual questions. The great weight of authority supports this conclusion. See, e.g., Vitamins, 209 F.R.D. at 269; Flat Glass, 191 F.R.D. at 488; Potash, 159 F.R.D. at 699; Wirebound Boxes, 128 F.R.D. at 272; 2 Newberg on Class Actions § 4:26 (4th ed. 2006) ("challenges based on the statute of limitations . . . have usually been rejected and will not bar predominance satisfaction because those issues go to the right of a class member to recover, in contrast to underlying common issues of the defendant's liability"). Indeed, the Third Circuit recently held, in reviewing a motion for class certification in an antitrust price-fixing action, that, although individual, plaintiff-specific determinations as to the appropriateness of tolling the limitation period and as to the timing of the commencement of this period will arise at trial, common issues of concealment predominate because the inquiry focuses on the alleged obscurantism of the defendants, rather than on the plaintiffs' conduct. See Linerboard, 305 F.3d at 162-163. Moreover, "individualized facts of fraudulent concealment may be adjudicated in the same fashion and at the same time as individual damages issues." Id. at 163. Finally, the Court notes that defendants do not contest plaintiffs' assertion that common issues of proof predominate over individual issues with respect to plaintiffs' fraudulent concealment allegations.
6. Superiority
In determining whether a class action is the superior method of efficiently and fairly adjudicating the controversy, a court must evaluate the interest of members of the class in individually controlling the prosecution of separate actions, the extent and nature of pre-existing litigation concerning the controversy, the desirability of concentrating the litigation in the particular forum, and the difficulties likely to be encountered in the management of the proposed class. See Fed.R.Civ.P. 23(b)(3). In general, the superiority analysis requires the court to balance the utilization of the class action method against alternative styles for adjudicating the claims raised by plaintiffs. Id.
Defendants argue that the proposed class would be unmanageable because many of the proposed class members "likely will be unable to document their purchase" of plastics additives during the class period, which spans thirteen years. (See Joint Def. Br., at 53). In particular, defendants note that two of the named class representatives, Heritage and Isaac, lack invoices of purchases before 2000, and that no transactional data predating 2002 is available for one of the non-settling defendants, that no transactional data predating 2000 is available for three of them, and that only some earlier transactional data exists for the remaining non-settling defendants. (Id.; see also Table 2 to Beyer Aff.; Kaplan Aff., at Ex. 53). Defendants argue that this lack of documentation as to plastics additives' purchases will overload the litigation with individualized questions of class membership and damages, leading to a series of mini-trials both to test the sufficiency of evidence presented in support of membership and damages and to guard against fraud. (See Joint Def. Br., at 53-56).
The Court expresses concern about the manageability of each subclass, particularly because the lack of invoice documentation among class representatives and the long duration of the class period carry the potential to complicate, through individualized inquiry, the question of class membership. Nonetheless, the Court does not feel that this issue should defeat class certification at this juncture for several reasons. First, the Court notes that denying certification on the sole ground of the unmanageability of the action, at least at the class certification stage, is "disfavored." See, e.g., In re Visa Check/Mastermoney Antitrust Litig., 280 F.3d 124, 140 (2nd Cir. 2001). Second, the Court has divided plaintiffs' proposed class into six subclasses, which, by reducing the number of members and defendants per class, limits the number of individualized membership issues and thereby enhances the manageability of the litigation. See Fed.R.Civ.P. 23(c)(4) (court may treat each subclass as separate class). Third, unlike cases in which class certification has been denied in part upon manageability grounds, such as where the proposed class consisted of millions of unsophisticated purchasers of common-place retail commodities, like over-the-counter cough, cold, and flu products, each subclass in the instant action consists of hundreds of sophisticated purchasers of specialized products for commercial purposes; the nature of the product, the sophistication of the proposed members, and the number of purchasers (i.e., hundreds rather than millions) make it more likely that proposed members of each subclass will have records, if not receipts, of their purchases, and that, in the absence of such records, they will have the capacity to recall the type of product they purchased, the date of this purchase, and from whom they purchased this product. See, e.g., In re Phenylpropanolamine ("PPA") Prods. Liab. Litig., 214 F.R.D. 614, 617-620 (W.D. Wash. 2003) (denying class certification on unmanageability grounds when six of eight putative subclass representatives lack physical proof of purchasing PPA-containing product, when average consumers would have to recall if and when they purchased an over-the-counter cough, cold, and flu product containing a single ingredient, and when receipts would probably not contain enough detail to determine precise composition of product purchased or date of product's expiration). Fourth, the considerations in support of plaintiffs' satisfaction of the other elements of the class certification standard warrant a finding that a class action is a superior method for resolving plaintiffs' claims, despite defendants' legitimate concerns about the manageability of each subclass. See, e.g., Carbon Black, 2005 WL 102966, at *21 (finding superiority of class action mechanism in part because of considerations which supported Court's finding of predominance);Dumas v. Albers Medical, Inc., 2005 WL 2172030, at *7 (W.D. Mo. Sept. 7, 2005) (finding case unmanageable under Rule 23(b)(3)(D) for same reasons it does not meet predominance requirement under Rule 23(b)(3), including inability to identify putative class members without individualized inquiry into each purchase of allegedly counterfeit prescription drug); 7AA Wright, Miller, Kane, Fed. Prac. Proc. § 1781 (3d ed. 2005) (noting that "if common questions are found to predominate in an antitrust action, then courts generally have ruled that the superiority prerequisite of Rule 23(b)(3) is satisfied" and concluding that this result seems "proper"). Fifth, the Court finds that plaintiffs fulfill the other factors within the superiority analysis, in that the size of each subclass, the common issues involved, the expense and administrative burden of separately litigating antitrust claims against defendants, and the fact that the Court is unaware of class members who wish to separately represent their own interests underscore the superiority of the class action mechanism; in fact, defendants do not challenge plaintiffs' fulfillment of the other factors within the superiority analysis, nor do defendants demonstrate the suitability of an alternative technique for resolving this litigation. See Fed.R.Civ.P. 23(b)(3); In re Sugar Indus. Antitrust Litig., 73 F.R.D. 322, 357-358 (E.D. Pa. 1976). Finally, in the event of frequent and significant disputes regarding class membership, the Court has the power to amend or to decertify one or more of the subclasses. See Fed.R.Civ.P. 23(c)(1).
To the extent that defendants argue that the class action format is not a superior method of resolving the issues in this litigation because injury and damages can only be determined on a purchaser — or product-specific basis, the Court rejects this argument for the same reasons it found that common issues of antitrust impact and damages will predominate over individual issues. See In re Vitamins Antitrust Litig., 209 F.R.D. at 270.
7. Class Definition
A proposed class is ascertainable, or identifiable, if "its members can be ascertained by reference to objective criteria."In re Methyl Tertiary Butyl Ether Prods. Liability Litig., 209 F.R.D. 323, 337 (S.D.N.Y. 2002). The use of subjective variables to define the parameters of a proposed class defeats the requisite precision for class certification. Id.
Defendants argue that the proposed class is not ascertainable because it is difficult, if not impossible, to determine whether certain products fall within plaintiffs' ambiguously defined categories of plastics additives — "heat stabilizers, impact modifiers, or processing aids." (See Joint Def. Br., at 47-53). For instance, defendants argue that potential class members would be unable to determine whether products with functional characteristics similar to heat stabilizers, impact modifiers, and processing aids, but which are being used for other applications, fall within the class definition; or whether products which share only some of the functional characteristics of heat stabilizers, impact modifiers, or processing aids nonetheless qualify as plastics additives for purposes of the class action. (Id.).
The Court finds that plaintiffs' proposed definition meets the standard for ascertainability, so long as plaintiffs fragment the proposed class into subclasses respectively covering purchasers of organotins, mixed metals, ESBO, MBS, acrylic impact modifiers, and acrylic processing aids from January 1, 1990 to January 31, 2003. In other words, plaintiffs' class definition is identifiable so long as this definition is refined into smaller subclasses referring to those products that correspond to Beyer's six segments of the plastics additives' industry. For instance, plaintiffs concede in their reply brief that they intended the proposed class to cover Beyer's six product segments, the only segments within the plastics additives' industry allegedly subject to defendants' price-fixing schemes. (See Pl. Br., at 25-27). Furthermore, products falling within these six segments are capable of definition through objective criteria, as illustrated through Beyer's affidavits, the report of Dr. James Summers ("Summers"), defendants' industry expert, and the Plastics Additives 2002 Global Study Report. (See Beyer Aff., at ¶¶ 16-22; Summers Report, at ¶¶ 20, 28, 35, 41-42, 48-49, 55; Plastics Additives 2002 Report, attached as Ex. 5 to Pl. Reply Br.). Indeed, many of the very products identified by defendants as challenging the contours of plaintiffs' proposed class definition were appropriately excluded by Kaplan, prior to conducting his pricing structure analysis, as not falling within any of the six segments. (See Kaplan Dep., attached as Ex. 3 to Pl. Reply Br., at 106-107, 114-115, 37-140, 153-155). The six segments identified by plaintiffs also appear to conform with categories of plastics additives employed by analysts within the plastics additives' industry, including by defendants in their price announcements, thereby suggesting that purchasers within the industry would also be able to determine whether they are covered by each subclass definition. (See Def. Price Announcements, attached as Ex. 6-29 to Pl. Reply Br.). Finally, to the extent some ambiguity exists as to whether certain products fall within a particular segment, the Court notes that it has the power to modify the definition of each subclass at a later juncture to account for such complications, if they arise.See 1 Newberg on Class Actions § 2:4 (4th ed. 2006) (noting that neither the text nor the policies behind Rule 23 require "that class members be determinable either at the outset of the litigation or at the time of class notice").
III. Conclusion
For the following reasons, this Court denies defendants' motion for an evidentiary hearing; and grants plaintiffs' motion for class certification upon condition that plaintiffs divide their proposed class into six subclasses, with each subclass covering all persons who purchased plastics additives within a particular product segment (i.e., organotins, mixed metals, ESBO, MBS, acrylic impact modifiers, or acrylic processing aids) between January 1, 1990 and January 31, 2003 from defendants operating within that particular segment. Each subclass will be certified to prosecute price-fixing claims brought under ¶ 1 of the Sherman Act. An appropriate Order follows
ORDER
AND NOW, this ____ day of August 2006, upon consideration of plaintiffs' motion for class certification (Doc. No. 213), defendants' responses in opposition to plaintiffs' motion for class certification (Doc. No. 239-241), plaintiffs' reply brief in further support of class certification (Doc. No. 253), defendants' joint motion for an evidentiary hearing (Doc. No. 255), plaintiffs' memorandum in opposition to defendants' motion for an evidentiary hearing (Doc. No. 256), and defendants' reply brief in further support of an evidentiary hearing (Doc. No. 260), it is hereby ORDERED as follows:The parties' experts have identified the specific segments in which defendants operated. (See Kaplan Aff., at ¶ 8; Beyer Aff., at ¶¶ 26-27).