In re: Domestic Drywall Antitrust Litigation

(E.D. Pa., MDL No. 2437 and 13-MD-02437)

Frequently Asked Questions Regarding the Settlement

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Questions

Answers

1. Why was the Notice published?

Answer:

The Court authorized the Notice because indirect purchasers of Drywall for end use and not for resale have a right to know about the New Settlement and the Proposed Distribution described below and their options regarding these matters. The Notice explains the lawsuit, the New Settlement, and your legal rights and options with respect to the New Settlement and the Proposed Distribution.

The Court in charge of this case is the United States District Court for the Eastern District of Pennsylvania, Judge Michael M. Baylson. This case is known as In re: Domestic Drywall Antitrust Litigation, MDL No. 2437 and 13-MD-2437. The indirect purchasers of Drywall who are named in the lawsuit are the Plaintiffs and are also called the Class Representatives. The Defendants—the companies sued by the Plaintiffs—include the major Manufacturers of Drywall, except for CertainTeed Gypsum, Inc. and Georgia Pacific LLC who are not Defendants in this case.

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2. What is the lawsuit about?

Answer:

This lawsuit was filed by 220 Golden Gate Associates L.P., Afamefuna Agbodike, Nicholas L. DeMarco, East Island Commercial LLC, John Hauser, Amy Hauser, Geoffrey Jones, Brian Lisonbee, William Perry, Mark Petersen, Todd Ramsay, Alan Shultz, Daniel Stringer, and Kevin Tragesser (collectively, “Plaintiffs” or “Class Representatives”) individually and as representatives of all persons in the United States who purchased Drywall manufactured by Defendants indirectly for end use and not for resale.  The lawsuit asserts that the Manufacturers conspired, in violation of state and federal antitrust laws, to raise, fix, maintain or stabilize the price of Drywall and, to help further this price-fixing conspiracy, to abolish the industry’s long-standing practice of limiting price increases for the duration of a construction project through the use of “job quotes.”  The lawsuit alleges that as a result of the Manufacturers’ alleged conduct, the prices paid for Drywall were higher than they otherwise would have been.  Plaintiffs seek to recover three times the actual damages that they allege the Manufacturers’ conduct caused, as well as attorneys’ fees, expenses and costs.  Defendants deny Plaintiffs’ allegations, but the Court has found that Plaintiffs have submitted sufficient evidence to allow their claims regarding the alleged conspiracy to go to trial against certain Defendants.


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3. What is a class action lawsuit?

Answer:

In a class action, people or entities called class representatives sue on behalf of people or entities that have similar claims.  All these entities make up the class and are called class members.  The Court then resolves the issues for all class members in a single proceeding, except for those who exclude themselves from the class.


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4. What is the current status of the lawsuit?

Answer:

Starting in December 2012, indirect and direct purchasers of Drywall filed lawsuits claiming that the Manufacturers conspired to fix prices, in violation of the federal antitrust laws, and the cases were consolidated before Judge Baylson in the Eastern District of Pennsylvania. On June 24, 2013, Plaintiffs filed a Consolidated Amended Class Action Complaint (the “Complaint”).  Defendants answered the Complaint, denying that they violated the federal antitrust laws and asserting defenses to Plaintiffs’ claims.


In February 2015, Plaintiffs reached separate settlement agreements with USG and TIN for $8.75 million and $1.75 million, respectively, and the District Court granted final approval of those settlements on August 20, 2015.  In June 2016, Plaintiffs reached a settlement agreement with Lafarge for $5.2 million, and the District Court granted final approval of that settlement on February 28, 2017.  As a result of these settlements, USG, TIN, and Lafarge have been dismissed from the case.  Notice was previously provided about those settlements; copies of those notices are available on this website or by calling 1-855-229-7511. More information regarding the proposed distribution of the funds from those settlements can be found in Part 3 of the Notice.


The Court has not resolved the merits of Plaintiffs’ claims or determined whether the Plaintiffs’ or Defendants’ contentions are true.  In February 2016, the Court found that Plaintiffs offered sufficient evidence to allow their claims to go forward against Lafarge (which subsequently settled), NGC, American Gypsum, and PABCO.  However, the Court found Plaintiffs’ evidence insufficient to allow their claims to go forward against CertainTeed.


On August 24, 2017, the Court denied Plaintiffs’ motion to certify a class for trial.  As described in Part 2 of the Notice, subsequent to the Court’s decision, Plaintiffs reached a settlement with the remaining Defendants (NGC, American Gypsum, and PABCO).  Case law precedents allow a court to approve a class-based settlement even though the court had denied a class during the litigation.


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5. What is the case caption?

Answer:

The caption (or title) of the lawsuit is provided here.  You need to include the caption with any objection you file to the New Settlement Agreement or the Plan of Distribution.


IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA


IN RE: DOMESTIC DRYWALL ANTITRUST LITIGATION


THIS DOCUMENT RELATES TO:

ALL INDIRECT PURCHASER ACTIONS


MDL NO. 2437 13-MD-2437


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6. The Proposed Settlement Agreement with American Gypsum, NGC and PABCO.

Answer:

Plaintiffs have agreed with American Gypsum, NGC and PABCO to settle the lawsuit on behalf of the New Settlement Class.  The proposed settlement is only with American Gypsum, NGC and PABCO.  Defendants Lafarge, TIN, and USG were previously dismissed as a result of their prior settlements.


The settlement with American Gypsum, Eagle Materials, NGC, and PABCO provides that the Settling Defendants will pay $1.25 million, which includes $250,000 allocated for the cost of notice.


Co-Lead Counsel believes that the New Settlement is fair and in the best interests of the New Settlement Class Members.

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7. How do I know if I am a member of the New Settlement Class?

Answer:

The New Settlement Class includes:


All persons or entities currently residing in the United States that indirecly purchased Drywall in the United States manufactured by any of the Defendants, their subsidaries, affiliates, or joint venturers for end use and not for resale during the Settlement Class Period (January 1, 2012 - January 5, 2018).

 

However, even if you meet these requirements, you are not a member of the New Settlement Class if you are one of the following:

 

Excluded from the Settlement Class are Defendants, the officers, directors and employees of any Defendant, the parent companies, subsidiaries and affiliates of any Defendant, the legal representatives and heirs or assigns of any Defendant, any co-conspirators, any state or federal entities or instrumentalities of the federal government or of a state, any judicial officer presiding over the Action, any member of his or her immediate family and judicial staff, and any juror assigned to the Action.  


You are also not a member of the New Settlement Class if you choose to exclude yourself from the New Settlement Class.


“Indirectly purchased” means purchased from a source other than directly from Defendants, and “end use and not for resale” means drywall not purchased to be sold to someone else.   Thus, for example, contractors purchasing drywall to resell to their customers as part of construction projects would not be class members.  However:


·       A commercial or business entity who paid a builder or contractor to renovate or repair an existing office building, professional office, or other establishment that the entity used for business purposes would be a class member. 


·       A homeowner purchasing drywall through a contractor by hiring a contractor to perform a construction project including drywall purchase and installation would be a class member. 


·       An individual or business entity purchasing drywall as a stand-alone product at a retailer such as Home Depot or Lowe’s for use in a “Do-It-Yourself” project would be a class member.


An individual or entity indirectly purchasing drywall for end use does not stop being a class member if they later sold the property for which they purchased drywall.  If you have questions about whether you are a class member, you can call 1-855-229-7511.


The New Settlement recovers money for the benefit of class members located in or making a purchase in or from an entity located in Arizona, Arkansas, California, the District of Columbia, Florida, Illinois, Iowa, Kansas, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Puerto Rico, Rhode Island, South Dakota, Tennessee, Utah, Vermont, West Virginia, and Wisconsin (“Statewide Damages Class”).  These states and the District of Columbia have antitrust and/or consumer protection laws permitting consumers to sue for damages for antitrust violations. If you made your relevant purchases of Drywall outside of these states, you cannot make a claim for damages.  The Plan of Allocation, set forth in paragraph 3.3 of the Notice, explains how the settlement proceeds will be allocated.

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8. What am I giving up if I stay in the New Settlement Class?

Answer:

By staying in the New Settlement Class you will give up your right to individually sue American Gypsum, NGC and PABCO for claims related to their alleged violations of the federal antitrust laws, as set forth in the Complaint.  That means you cannot sue, continue to sue, or be part of any other lawsuit against American Gypsum, NGC or PABCO for the claims asserted in this lawsuit against American Gypsum, NGC and PABCO.  It also means that all of the Court’s rulings will apply to you with respect to American Gypsum, NGC, or PABCO and legally bind you, whether favorable or unfavorable to the New Settlement Class.


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9. Will I receive money from the New Settlement?

Answer:

Co-Lead Counsel will ask the Court to distribute the funds from the New Settlement (and prior settlements) to Statewide Damages Class members submitting valid claims.  Part 3 of the Notice explains how to submit claims.  Except as provided elsewhere in the Notice, it is Co-Lead Counsel’s intention to hold the funds received in an interest-bearing account until the Court orders the funds to be distributed.  Co-Lead Counsel will also be asking for an award of attorneys’ fees, reimbursement of litigation expenses and service awards for Plaintiffs for their service to the settlement classes.

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10. The Settlement Hearing and Objecting to the New Settlement.

Answer:

The Court will hold a hearing on October 25, 2018 at 2:00 p.m. at the James A. Byrne United States Courthouse, 601 Market Street, Philadelphia, PA 19106, Courtroom 3A, to consider whether the New Settlement is fair and should be approved.  The Court may also consider whether to approve Plaintiffs’ proposed distribution of the settlement funds as described in Part 3 of the Notice.  The hearing may be continued or rescheduled without further notice.


If you do not exclude yourself from the New Settlement Class, you may object to the terms of the New Settlement Agreement.  Your objection must be in writing, include the caption of this litigation (provided on page 3 of the Notice), state the nature and grounds for your objection, be signed by you, and be filed no later than September 21, 2018 with the Clerk of Court, United States District Court for the Eastern District of Pennsylvania, James A. Byrne United States Courthouse, 601 Market Street, Philadelphia, PA 19106, with copies mailed to Co-Lead Counsel (addresses provided in Question 13 below).  If you do not object to the New Settlement or Plaintiffs’ proposed distribution of the settlement funds (see Question 19 below), you do not need to appear at the hearing or take any other action at this time.

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11. How do I exclude myself from the New Settlement Class?

Answer:

If you want to exclude yourself from the New Settlement Class, you must mail a written request to be excluded to the Domestic Drywall Class Administrator at the following address: Indirect Drywall Settlement, Settlement Administrator c/o Heffler Claims Group, P.O. Box 58190, Philadelphia, PA 19102.

The written request must include your name and address and specifically state that you request exclusion from the New Settlement Class.  The written request must be postmarked no later than September 21, 2018.  If you elect to be excluded from the New Settlement Class, you will not be legally bound by any judgment dismissing American Gypsum, NGC and PABCO from the lawsuit and will remain free to pursue any legal rights you may have, including bringing a lawsuit, against American Gypsum, NGC or PABCO at your own expense.  If you are excluded from the New Settlement Class, you will not receive any money or other benefits which are awarded to the New Settlement Class, and you will not be allowed to object to the New Settlement, as described in question 10. 


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12. What is the difference between objecting to the New Settlement and requesting exclusion from the New Settlement?

Answer:

Objecting is simply telling the Court that you do not like something about the New Settlement.  You can object to the New Settlement only if you do not exclude yourself from the New Settlement Class.  Excluding yourself is telling the Court that you do not want to participate in the New Settlement.  If you exclude yourself from the New Settlement Class, you cannot object because the New Settlement no longer affects you.

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13. Do I have a lawyer in this case?     

Answer:

The Court appointed the following law firms to represent the New Settlement Class:


BLOCK & LEVITON LLP

155 Federal Street, Suite 400

Boston, MA 02110

Tel:  (617) 398-5600


FINKELSTEIN THOMPSON LLP

3201 New Mexico Ave, Suite 395

Washington, DC 20007

Tel: (202) 337-8000


GREEN & NOBLIN, PC

700 Larkspur Landing Circle, Suite 275

Larkspur, CA 94939

Tel:  (415) 477-6700

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14. How will the lawyers be paid?

Answer:

Attorneys for the New Settlement Class are litigating this case on a completely contingent fee basis, meaning that you are not personally responsible for the attorneys’ fees, costs, or expenses in the case.  As described in Part 3 of the Notice, Co-Lead Counsel intends to ask the Court for attorneys’ fees and reimbursement of litigation expenses from the New Settlement and the earlier settlements.  The Court can approve or deny any such a request.


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15. If i stay in the New Settlement Class, may I enter an appearance in the litigation through an attorney at my own expense?

Answer:

If you stay in the New Settlement Class, you may, but do not have to, enter an appearance in the lawsuit through an attorney at your own expense.


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16. What happens if I do nothing at all?

Answer:

If you are a member of the New Settlement Class and you choose to take no action, your interests as a member of the New Settlement Class will be represented by the Plaintiffs and Co-Lead Counsel and you will be bound by any decision or judgment entered by the Court with regard to the New Settlement.  You will not be able to start or continue with a lawsuit against American Gypsum, NGC, or PABCO regarding the claims described herein. 


If you do not submit a claim in accordance with the procedures set forth in Part 3 of the Notice, you will not receive anything from the settlement fund.  Question 18  describes who is entitled to submit a claim.  As a member of the New Settlement Class, you will not be personally responsible for attorneys’ fees, costs or litigation expenses; any attorneys’ fees, costs and expenses will be awarded by the Court, and paid out of the total recovery, as described in Part 3 of the Notice.

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17. What settlement funds are to be distributed?

Answer:

Plaintiffs in this case previously reached settlements with Lafarge, TIN, and USG totaling a combined $15.7 million.  Co-Lead Counsel has not previously asked the Court to distribute any of the funds from the prior settlements to settlement class members and the settlement funds are being held in an interest-bearing account.  If the Court approves the New Settlement, Co-Lead Counsel will now ask the Court to distribute the funds from each of the settlements (including the New Settlement), after deduction of attorneys’ fees, litigation expenses and any service awards to the Class Representatives.


The funds from all the settlements in the litigation (that is, the USG, TIN, Lafarge, and New Settlements), including any accrued interest, will be combined in a single Combined Settlement Fund.  Any entity that is eligible to receive a payment under the Plan of Allocation that submits a valid claim will be entitled to receive a payment.

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18. How do I submit a claim?

Answer:

If you are eligible to receive a payment under the Plan of Allocation and want to make a claim from the Settlement Fund, you must complete and submit a Claim Form. We urge you to submit a claim online through this website under the "submit claim" section. If you do not file online, you can also submit a claim by mail.

 

The Claim Form can be found and completed or downloaded on this website, or you can obtain a copy by calling the Settlement Administrator toll free at 1-855-299-7511. If you choose to submit your claim online, you must do so on or before January 9, 2019. If you choose to submit a Claim Form by mail, it must be postmarked by January 9, 2019, and mailed to: Indirect Drywall Settlement, Settlement Administrator, c/o Heffler Claims Group, P.O. Box 58190, Philadelphia, PA 19102.

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19. How will the settlement funds be distributed?

Answer:

The Net Combined Settlement Fund (the Combined Settlement Fund less any Court-awarded attorneys’ fees, expenses, and service awards) will be distributed to Statewide Damages Class (defined in paragraph 2.2 of the Notice) members submitting claims showing individual purchases of Drywall between January 1, 2012 and December 31, 2013 (“Claims Period”) indirectly for end use and not for resale.  State and local entities purchasing Drywall for end use and not for resale may also submit claims but will have their claims discounted as set forth below.  The Plan of Allocation does not provide for a monetary recovery for anyone that does not fit these criteria.   


The Net Combined Settlement Fund will be allocated to two groups of Statewide Damages Class Members.  These groups are:


17% of the Net Combined Settlement Fund will be allocated to the Do-It-Yourself Homeowner Group.  The Do-It-Yourself Homeowner Group includes all Statewide Damages Class members’ purchases of stand-alone drywall for use in a project they performed in their own home.  Thus, this group includes all individuals purchasing drywall at a retailer (such as Home Depot, Lowe’s, or Menards) who used that drywall for a home repair or remodeling project they performed. 

83% of the Net Combined Settlement Fund will be allocated to all other Statewide Damages Class members.  Claimants in this group therefore include all businesses or commercial Statewide Damages Class members, as well as any person or entity paying a contractor for a repair or remodeling project including Drywall.

Within each group, funds will be distributed pro rata in accordance with the claimant’s Recognized Claim Amount, computed as described below.  There will be a $50 floor for recovery, meaning only claimants entitled to a payment of $50 or more will receive a check.  A claimant’s Recognized Claim Amount will be computed as follows:       

o   Claimants submitting proof of purchase during the Claims Period that shows the price they paid for Drywall will have those purchases valued at 100% for purposes of computing a Recognized Claim Amount.


o   Claimants unable to provide any proof of purchase during the Claims Period may sign a declaration in which they attest to (1) the number of sheets of drywall they purchased, or (2) the square footage of the drywall installed in their homes.  The drywall will be valued at $11 a sheet to compute the class members’ estimated purchase price.  These class members will have those purchases valued at 75% (or $0.75 on the dollar) for purposes of computing a Recognized Claim Amount and will be subject to a $100 cap on any settlement payment they will receive.


Any state entities submitting claims will additionally have their claims valued at 61% (or $0.61 on the dollar), after the above calculations are applied, to compute their Recognized Purchase Amount.  This reflects that TIN and USG did not exclude state entities from their settlements, and that TIN and USG collectively contributed approximately 61% to the Settlement Fund.

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20. How will the lawyers be paid?

Answer: