Lear wants court to approve $8.75 million settlement over price-fixing suit

Article by Christian A., on May 12, 2014

Lear Corp. will ask United States District Judge Marianne Battani in Detroit to approve an $8.75-million settlement to resolve accusations that it took part in a conspiracy to hike prices of wire harness components between 2000 and 2010 in a multi-district litigation lawsuit.

The civil cases are distinct from the ongoing global criminal probe into price fixing in the automotive supply chain. Antitrust authorities in North America, Europe and Asia are currently probing into the matter. In the US, federal anti-trust authorities so far have imposed around $2.29 billion in fines on auto suppliers, most of them from Japan.

The US Justice Department disclosed in April that 33 people have been charged while 26 companies have either pleaded guilty or agreed to plead guilty.

Lear’s settlement agreement include a $4.75 million payout to the lawsuit’s “direct purchasers,” or other carmakers that purchased the parts at colluded prices; a $3 million payout to car buyer plaintiffs; and a $1 million payout to dealerships part of the court case.

The agreement also required Lear to put up $370,263 of its own cash and acquire the remaining assets held in reserve from its Chapter 11 bankruptcy reorganization from 2009 for “disputed claims.”

Lear will attend a hearing on May 27 before U.S. Bankruptcy Judge Allan Gropper in New York to approve the use of the assets for the settlement. Lear said in a filing with the U.S. Securities and Exchange Commission that it maintains not violated any law in connection with price fixing scandal.

It noted that the conduct alleged by plaintiffs relates to periods prior to its bankruptcy emergence.

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Topics: lear

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