The fight continues in an ongoing antitrust lawsuit involving major players in the steel industry.
While five of the eight companies on the defendants’ side have already settled and their distribution funds approved, the other three companies continue to fight back against a discovery process they consider to be a “fishing expedition.”
In 2008, Pennsylvania-based Standard Iron Works and four other companies filed a lawsuit alleging U.S. Steel and ArcelorMittal conspired with six other domestic steel manufacturers “to manipulate the supply and price of steel products sold in the United States,” according to court documents. The plaintiffs alleged that, from April 1, 2005 to December 31, 2007, the eight steelmakers “conspired to restrict their output, thereby increasing the prices they were able to charge for steel products.”
Last year, five of the companies listed as defendants—Commercial Metals Company, AK Steel Holding Corp., Gerdau Ameristeel Corp., ArcelorMittal and U.S. Steel—settled. They all denied any wrongdoing but claimed to have settled in order to avoid the cost of further litigation and trial. The three remaining companies— Nucor, Steel Dynamics Inc. (SDI) and SSAB Swedish Steel—have continued the litigation process and show no signs of giving in.
The companies assert that the plaintiffs are now demanding documents and information from parties well below the “top executive” level and are steering beyond the scope of the case. On November 19, Judge James B. Zagel denied the plaintiffs’ motion to compel production of documents from top-level mill managers, including general managers and sales managers. SDI had previously provided that information anyway, and Nucor and SSAB both filed oppositions—which were compelling enough for the ruling.
The defendants have repeatedly referred to the investigation as a “fishing expedition” and have held their ground denying any wrongdoing. SDI motioned for a summary judgement on September 20 to dismiss all claims made against it and is awaiting a response.
Meanwhile, SDI continues to fight off requests for documents from additional parties it deems unnecessary. According to court documents, the company asserts it has produced 300,000 pages of documents from the files of 11 “custodians” hand-picked by the plaintiffs—custodians that “go far beyond top executives.” It continues, “[T]he documents cover every conceivable merits issue—including pricing, production, capacity utilization, output, production curtailment, communications with other defendants and industry gatherings.”
“Alone among Defendants, SDI has gone further and offered to produce additional documents from the manager of each steel mill, in addition to its top three executives,” the filing reads. “… SDI has always produced to customer orders, and the General Manager of each steel mill makes production and pricing decisions concerning all products rolled at that particular mill. That of course defeats Plaintiffs’ theory of a ‘top executive’ conspiracy, but SDI has offered to produce each General Manager’s documents anyway.”
SDI says the plaintiffs still demand that “SDI cast an even wider net to capture even more employee-custodians. Plaintiffs’ assumption that they are entitled to this discovery now as the ‘last phase’ before trial ignores their own theory of a CEO-level conspiracy to reduce production below competitive levels; ignores the Court’s repeated instructions to Plaintiffs to ‘start with the people on top and you see what they have to say’—indeed, to start with the CEOs; ignores the 300,000 pages of documents SDI has already produced and ignores SDI’s pending motion for summary judgment and Plaintiffs’ need to respond.”
Last month, distribution of settlement funds for 1,857 claims totaling just under $103.7 million were approved and were to be paid by the five previously settled parties.