Hedges Enterprises, Inc. v. Continental Group, Inc.

81 F.R.D. 461, 27 Fed. R. Serv. 2d 1266
District Court, E.D. Pennsylvania·Decided February 6, 1979·No. Civ. A. No. 78-1254·Published·Cited by 42 cases

Opinion

MEMORANDUM

BECHTLE, District Judge.

Plaintiff Hedges Enterprises, Inc. (“Hedges”), brought this action pursuant to Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15 and 15/26" style="color:var(--green);border-bottom:1px solid var(--green-border)">26, respectively, to obtain injunctive relief and to recover treble damages and the cost of suit, including reasonable attorneys’ fees, for the injuries allegedly sustained by Hedges, and the class it seeks to represent, resulting from the alleged violation by the defendants of Section 1 of the Sherman Act, 15 U.S.C. § 1, as amended. The defendants named in Hedges’ complaint are Continental Group, Inc. (“Continental”), American Bag & Paper Corporation (“American”), Chase Bag Company (“Chase”) Harley Corporation (“Harley”) and St. Regis Paper Company (“St. Regis”). The jurisdiction of this Court is invoked pursuant to 28 U.S.C. § 1337. Presently before the Court is the plaintiff’s motion for determination of this suit as a class action, pursuant to Fed.R.Civ.P. 23(a) and (b)(3). For the reasons stated below, plaintiff’s motion for class action determination will be granted and we will certify, pursuant to Fed.R.Civ.P. 23(a) and (b)(3), the following class:

All individuals, proprietorships, partnerships, corporations and other business entities which have, during the period from January 1, 1950, to November 1, 1976, purchased consumer bags, also known in the trade as “small bags,” directly from one or more of the defendants for use in their business in packaging their products and not for resale as “small bags.”

In its complaint, Hedges alleges, inter alia, that: •

Beginning at least as early as 1950, the exact date being unknown to the plaintiff, and continuing thereafter until at least November, 1976, the defendants have engaged in a continuing combination and conspiracy in unreasonable restraint of the aforesaid interstate trade and commerce in violation of Section 1 of the Sherman Act The aforesaid combination and conspiracy consisted of a continuing agreement, understanding, and concert of action among the defendants and co-conspirators of the substantial terms of which were to raise, fix, maintain and stabilize the prices and terms and conditions of sale of consumer bags.

Complaint, ¶¶ 12, 13. The complaint further alleges that the following effects occurred as a result of the conspiracy:

(a) Prices and terms and conditions of sale of consumer bags sold by the defendants and various co-conspirators have been raised, fixed, maintained and stabilized at artificial and noncompetitive levels;
(b) Buyers of consumer bags have been deprived of the benefits of free and open competition in the purchase of consumer bags; and
(c) Competition among the defendants and various co-conspirators in the sale of consumer bags has been restrained.

Complaint, ¶ 15. The term “consumer bag” is defined in the complaint as follows:

Consumer bags, also known in the trade as “small bags,” are made from one or more plies of paper and may be combined with other materials used as linings and/or coatings. Consumer bags may have printed exterior designs as specified by the customer and are generally designed for capacities of less than twenty-five pounds. They are normally used to prepackage products which are then marketed in such bags.
Consumer bags are used for packaging a variety of products such as those sold by plaintiff herein and include, among other[s], pet foods, cookies, tea, coffee, kitty litter, chemicals and agricultural products.

Complaint ¶¶ 9, 10. In addition, Hedges alleges that, in the course of its business and during the period of time covered by its [464]*464complaint, it purchased consumer bags directly from one or more of the defendants for use by its wholly-owned subsidiary, Thornton-Minor McCleary Ointment Co., Inc. (“Thornton”), and has sustained injury as a result of the defendants’ violations of the antitrust laws. Complaint, ¶ 3. Finally, Hedges alleges that it had no knowledge of the alleged antitrust violations, or of any facts which might have led to the discovery thereof, until November, 1976, and that it could not have discovered the violations at an earlier date by the exercise of due diligence because of the deceptive practices and techniques of secrecy employed by the defendants to avoid detection of and to fraudulently conceal such violations. Complaint, ¶ 16.

Hedges brings this action on behalf of itself and all others similarly situated and seeks to have the following class certified pursuant to Fed.R.Civ.P. 23(a) and (b)(3):

All individuals, proprietorships, partnerships, corporations and other business entities which have, during the period of time defined herein, purchased consumer bags, also known in the trade as “small bags,” directly from one or more of the defendants for use in their businesses in packaging their products and not for resale as “small bags.”

I. Prerequisites to Maintaining Class Action

To maintain this case as a class action, Hedges must satisfy the requirements of Fed.R.Civ.P. 23(a), which states:

(a) Prerequisites to a Class Action. One or more members of a class may sue or be sued as representative parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.

In re Plywood Anti-Trust Litigation, 76 F.R.D. 570, 577 (E.D.La.1976). In addition to the requirements of Fed.R.Civ.P. 23(a), Hedges must also satisfy the Court that the action is properly maintainable under one of the three subdivisions of Rule 23(b). Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 163, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974); In re Plywood Anti-Trust Litigation, supra, 76 F.R.D. at 577. In this case, Hedges seeks certification of a class pursuant to Fed.R. Civ.P. 23(b)(3), which states:

Free access — add to your briefcase to read the full text and ask questions with AI

Hedges Enterprises, Inc. v. Continental Group, Inc., 81 F.R.D. 461, 27 Fed. R. Serv. 2d 1266 (E.D. Pa. 1979).

81 F.R.D. 461 (Hedges Enterprises, Inc. v. Continental Group, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Kleen Products LLC v. International Paper
306 F.R.D. 585 (N.D. Illinois, 2015)
In Re: Sheriff's Excess Proceeds Lit. Appeal of: J. O'Hara and Finn Land Corp.
98 A.3d 706 (Commonwealth Court of Pennsylvania, 2014)
In Re Linerboard
Third Circuit, 2002
Winoff Industries, Inc. v. Stone Container Corp.
305 F.3d 145 (Third Circuit, 2002)
In re Linerboard Antitrust Litigation
203 F.R.D. 197 (E.D. Pennsylvania, 2001)
In re Cardizem CD Antitrust Litigation
200 F.R.D. 297 (E.D. Michigan, 2001)
In re Flat Glass Antitrust Litigation
191 F.R.D. 472 (W.D. Pennsylvania, 1999)
In re Commercial Tissue Products
183 F.R.D. 589 (N.D. Florida, 1998)
Law v. National Collegiate Athletic Ass'n
5 F. Supp. 2d 921 (D. Kansas, 1998)
In re Nasdaq Market-Makers Antitrust Litigation
169 F.R.D. 493 (S.D. New York, 1996)
In re Industrial Diamonds Antitrust Litigation
167 F.R.D. 374 (S.D. New York, 1996)
In re Potash Antitrust Litigation
159 F.R.D. 682 (D. Minnesota, 1995)
In Re Catfish Antitrust Litigation
826 F. Supp. 1019 (N.D. Mississippi, 1993)
Brown v. Pro Football, Inc.
146 F.R.D. 1 (D.C. Circuit, 1992)
PBA Local No. 38 v. Woodbridge Police Department
134 F.R.D. 96 (D. New Jersey, 1991)
In re Wirebound Boxes Antitrust Litigation
128 F.R.D. 268 (D. Minnesota, 1989)