Three steel manufacturers are awaiting approval on settlements stemming from an ongoing lawsuit that has yet to be certified as “Class Action.”
The lawsuit was filed by several businesses, alleging eight steel manufacturers—ArcelorMittal, Nucor Corp., United States Steel Corp., Gerdau Ameristeel Corp., AK Steel Holding Corp., Steel Dynamics Inc., SSAB Swedish Corp. and Commercial Metals Company (CMC)—“conspired, in violation of the U.S. antitrust laws, to restrict their output and therefore raise or ‘fix’ the prices for Steel Products sold for delivery in the United States between April 1, 2005 and December 31, 2007.”
The initial complaint, according to a notice issued by a U.S. District Court in Illinois, alleges that “the Defendants violated the U.S. antitrust laws by conspiring to slow down their furnace production, thus restricting their output of raw steel and causing artificially higher prices for Steel Products.”
The companies that collectively filed suit against the eight manufacturers are Standard Iron Works, Wilmington Steel Processing Co. Inc., Capow Inc. d/b/a Eastern States Steel, Alco Industries Inc. and Gulf Stream Builders Supply Inc.
All of the defendants in the case deny the allegations. However, three companies—CMC, AK Steel and Gerdau—recently agreed to collectively pay $15.9 million into a settlement fund to be distributed at a later time.
While the settling defendants “deny that they engaged in a conspiracy or did anything wrong” and “have asserted a number of defenses,” they have agreed to settle “to avoid the cost of continued litigation and trial.”
If the settlements are approved at a July 10 hearing, the three companies will be relieved of their positions as defendants in the lawsuit. If approved, Gerdau will pay $6.1 million, AK Steel will pay $5.8 million and CMC will pay just under $4 million. According to the court, it is unknown how much each settlement class member will receive and when that amount will be received.
“It is common in cases like this one for the proceeds of settlements to be distributed on a pro rata basis, by calculating and comparing the dollar amounts of claimants’ purchases of affected products, or estimated overcharge amounts, or qualified claims,” reads the notice.
Meanwhile, litigation will continue for the other defendants—ArcelorMittal, U.S. Steel, Nucor, Steel Dynamics and SSAB.