Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_13-cv-04115/USCOURTS-cand-3_13-cv-04115-21/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:15 Antitrust Litigation

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

STEPHEN FENERJIAN, et al.,

Plaintiffs,

v.

NONG SHIM COMPANY, LTD, et al.,

Defendants.

Case No. 13-cv-04115-WHO 

ORDER GRANTING DEFENDANT'S 

MOTION FOR GOOD FAITH 

SETTLEMENT AND BAR ORDER

Re: Dkt. No. 206

INTRODUCTION

Defendant Samyang Korea moves for an order determining that it has entered into a good 

faith settlement agreement with plaintiffs pursuant to California Code of Civil Procedure sections 

877 and 877.6. Mot. [Dkt. No. 206.]. On October 5, 2015, Ottogi Corporation, Ltd., Ottogi 

America, Inc., Nongshim Co., Ltd ., and Nongshim America, Inc. (“Non-settling Defendants”) 

filed a limited opposition to Samyang’s motion that is confined to a single objection concerning 

access to discovery. Opp. [Dkt. No. 213]. Having considered the merits of the motion and the 

virtual lack of opposition by any party, I GRANT Samyang’s motion for good faith settlement 

determination.

BACKGROUND

Defendants Samyang Foods Company., Ltd., Nong Shim Company, Ltd., and Ottogi Ltd. 

manufacture and sell Korean noodles, also referred to as ramen noodles, in Korea. Amended 

Consolidated Indirect Purchaser Complaint (“AIPC”) ¶¶ 25-28 [Dkt. No. 121]. The Korean 

Noodles are sold in Korea as well as imported for sale elsewhere, including in the United States. 

On July 12, 2012, the Korean Fair Trade Commission (“KFTC”) issued an order finding that the 

Korean defendants conspired to increase the prices of Korean noodles in Korea. Id. at ¶3. The 

Korean defendants also exported ramen noodles for sale in the United States. Id. at ¶5.

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 1 of 6
2

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

Following that order, various direct and indirect purchasers of defendants’ Korean noodles 

in the United States filed price-fixing conspiracy actions against the Korean defendants and their 

alleged American distributors, alleging that the defendants conspired to raise the prices of Korean 

noodles sold in the United States. Plaintiffs allege that they paid more for Korean Noodles as a 

result of the price-fixing conspiracy than they would have paid in a competitive market. The 

various actions were consolidated and plaintiffs filed two consolidated complaints: a direct 

purchaser consolidated complaint and an indirect purchaser consolidated complaint. See Direct 

Purchaser Consolidated Complaint (“DPCC”) [Dkt. No. 61]; AIPC.1 

The direct purchaser plaintiffs (“DPP") are food retailers and distributors that purchased 

Korean Noodles directly from defendants. DPCC ¶¶ 11-16. They allege a cause of action for 

price-fixing conspiracy in violation of Sections 1 and 3 of the Sherman Act, 15 U.S.C. §§ 1, 3.

The indirect purchaser plaintiffs (“IPP”) are individuals who purchased Korean Noodles 

manufactured by defendants from retailers in California, Massachusetts, Michigan, Florida, and

New York. AIPC ¶¶ 10-24. They allege causes of action for (i) price-fixing conspiracy in 

violation of Section 1 of the Sherman Act,5 15 U.S.C. § 1; (ii) price-fixing conspiracy in violation 

of California’s Cartwright Act, Cal. Bus. & Code §§ 16700, et seq.; (iii) violations of antitrust and 

restraint of trade laws of California, Hawaii, Michigan, and New York; (iv) violations of state 

consumer protection laws of California, Florida, and Massachusetts and (v) unjust enrichment and 

disgorgement under the common laws of Hawaii and Massachusetts. AIPC ¶¶ 170-214.

Defendant Samyang reached a settlement with both the DPP and the IPP, requiring it to 

pay a total of $1.5 million and to cooperate in providing informal as well as formal discovery. See

Mann Decl., Exh. A [Dkt. No. 206-1] (“IPP Settlement”); Mann Decl., Exh. B (“DPP 

Settlement”). As an integral part of the settlement, Samyang seeks the court’s good faith 

determination of the settlement and a corresponding bar order. Samyang requests that I grant its 

order and find that upon the final approval of the settlements, the non-settling defendants are 

 

1

I dismissed plaintiff’s claims against Samyang’s American counterpart, Sam Yang (USA), Inc. 

(as well as against previously included defendants Yakult Korea and Paldo Company Ltd.). Dkt. 

No. 115. The remaining defendants are as follows: Samyang Foods Company., Ltd., Nong Shim

Company, Ltd., Ottogi Ltd., Nongshim America, Inc., and Ottogi America, Inc.

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 2 of 6
3

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

barred from bring an action for indemnity and/or contribution relating to any of the claims 

brought, or that could have been brought, in the DPP and IPP actions against Samyang. Mot. at 1. 

Non-settling Defendants submitted a limited opposition to Samyang’s motion which objected only 

to a provision in the settlement agreement that stays the litigation against Samyang pending the 

final approval of its settlement. Opp. at 1.

LEGAL STANDARD

Under California law, “[w]here a release, dismissal with or without prejudice or a covenant 

not to sue or not to enforce judgment is given in good faith before verdict or judgment to one or 

more of a number of tortfeasors claimed to be liable for the same tort ... [i]t shall discharge the 

tortfeasor to whom it is given from all liability for any contribution to any other tortfeasors.” Cal. 

Civ. Pro. Code § 877. As a check on the validity of settlement agreements that might affect joint 

tortfeasors not a party to the settlement, California law further requires the court to make a 

determination that a settlement has been entered in good faith before that settlement can become 

final. Id. § 877.6. The section provides further that “[a] determination by the court that the 

settlement was made in good faith shall bar any other joint tortfeasor from any further claims 

against the settling tortfeasor for equitable comparative contribution, or partial or comparative 

indemnity, based on comparative negligence or comparative fault.” Id. § 877.6(c). 2

A settlement is made in good faith if it is within a “reasonable range” of the settling parties' 

proportionate share of liability to the plaintiff. Tech–Bilt Inc. v. Woodward–Clyde & Assoc., 38 

Cal.3d 488, 499 (1985). When making a determination that a settlement was made in good faith 

under section 877.6(a)(1), “the intent and policies underlying section 877.6 require that a number 

of factors be taken into account”: (1) a rough approximation of the plaintiff's total recovery and 

 

2

The plaintiffs also assert claims under the laws of Hawaii, Massachusetts, Michigan, Florida, and 

New York. While each state has their own statute requiring that release from contribution be 

given in good faith, all are similar to California. See Haw. Rev. Stat. § 663-15.5 (requiring that 

“[a] release, dismissal with or without prejudice, or a covenant not to sue or not to enforce a 

judgment [be] given in good faith”); Mich. Comp. Laws § 600.2925d (requiring that “a release or 

a covenant not to sue or not to enforce judgment [be] given in good faith”); Mass. Gen. Laws Ch. 

231B, § 4 (requiring that “a release or covenant not to sue or not to enforce judgment [be] given in 

good faith”); N.Y. Gen. Oblig. Law § 15-108 (requiring a “release [be] given in good faith”); Fla. 

Stat. Ann. § 768.31 (requiring that “a release or a covenant not to sue or not to enforce judgment 

[be] given in good faith”).

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 3 of 6
4

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

the settlor's proportional liability in view of the settlement amount; (2) the allocation of settlement 

proceeds among plaintiffs; (3) the recognition that a settlor should pay less in settlement than he 

would if he were found liable after trial; (4) the financial conditions and insurance policy limits of 

the settling tortfeasor; and (5) the existence of collusion, fraud or tortious conduct intended to 

injure the interests of the non-settling parties. Id.

“Practical considerations” require that the evaluation “be made on the basis of the 

information available at the time of settlement[,] and a defendant's settlement figure must not be 

grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate 

the settling defendant's liability to be.” Id. (citation omitted). The Court should approve even a 

contested settlement, unless there is a showing “that the settlement is so far out of the ballpark in 

relation to these factors to be inconsistent with the equitable objectives of the statute.” Id. at 499-

500. 

The burden of proving that a settlement between the parties was not made in good faith is 

on the non-settling tortfeasor. Cal. Civ. Proc. Code § 877.6(d). To successfully oppose a motion 

for good faith settlement, the opposing party “must demonstrate ... that the settlement is so far ‘out 

of the ballpark’ in relation to these factors as to be inconsistent with the equitable objectives of the 

statute.” Tech–Bilt, 38 Cal.3d at 499-500.

DISCUSSION

Here, the motion for good faith settlement and bar order is unopposed, except for the Nonsettling Defendants’ joint opposition to the motions for preliminary approval of both settlements 

and Samyang’s motion for good faith determination. Opp. at 1. The only objection presented in 

the opposition, relating to a potential discovery dispute, was resolved during the November 3, 

2015 hearing. The opposition did not address the Tech-Bilt factors nor any lack of good faith in 

Samyang’s settlements.

Applying the Tech-Bilt factors, I find that the settlements are in good faith. The $1.5 

million combined settlement amount is reasonable and certainly not so far “out of the ballpark” as 

to make it unreasonable. Tech–Bilt, 38 Cal.3d at 499. In proportion to Samyang’s profits from its 

American exports, which amount to approximately $27 million, Han Dec ¶ 2 [Dkt. No. 206-2], the 

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 4 of 6
5

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

recovery of $1.5 million equates to a 5% damages calculation. Pointing to a determination by the 

KFTC that a 2% price premium rate should be applied, Samyang argues that 5% is therefore 

reasonable. Mot. at 9. The reasonableness of the amount is also reinforced by Samyang’s 

potential defenses and Tech Bilt’s recognition that a settlor should pay less in settlement than he 

would if he were found liable at trial. Tech–Bilt, 38 Cal.3d at 499. The first defendant to settle 

often is entitled to a discount in the settlement amount, particularly if cooperation in discovery is 

also included. This settlement has real non-monetary worth in the form of Samyang’s agreement 

to make available its outside counsel, provide certain current employees available for deposition, 

produce specified documents, and furnish the last known contact information for former Samyang 

employees whose names were mentioned in the KFTC order. DPP Settlement ¶21; IPP Settlement 

¶21. Because of the difficultly plaintiffs face in establishing that defendants colluded to raise 

prices, this cooperation is valuable to plaintiffs’ case. Mot at 12-13.

Under California Civil Procedure Code § 877.6(c), “[a] determination by the court that the 

settlement was made in good faith shall bar any other joint tortfeasor or co-obligor from any 

further claims against the settling tortfeasor or co-obligor for equitable comparative contribution, 

or partial or comparative indemnity, based on comparative negligence or comparative fault.” Cal. 

Civ. Proc. Code § 877.6. Therefore, a determination that the settlement was in good faith would 

prevent contributory or indemnity claims by the Non-settling Defendants. As Samyang argues,

this is consistent with both the Sherman Act and the Cartwright Act which do not provide for 

contribution. See, e.g. Texas Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 646 (1981) 

(“We are satisfied that neither the Sherman Act nor the Clayton Act confers on federal courts the 

broad power to formulate the right to contribution sought here.”); Redwood Theatres, Inc. v. 

Festival Enterprises, Inc., 908 F.2d 477, 481 (9th Cir. 1990)( “The federal and California antitrust 

laws have identical objectives and are harmonious with each other.”) (internal quotation marks, 

citations, and modifications omitted); Pecover v. Electronics Arts Inc., 633 F. Supp. 2d 976, 984 

(N.D. Cal. 2009)( “[I]t is established that the Sherman Act and Cartwright Act are to be 

interpreted in harmony with one another.”) (internal quotation marks and citations omitted). Nonsettling Defendants do not oppose this argument and I find no reason to hold otherwise.

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 5 of 6
6

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

CONCLUSION

Samyang’s motion for good faith determination is GRANTED.

IT IS SO ORDERED.

Dated: November 10, 2015

______________________________________

WILLIAM H. ORRICK

United States District Judge

Case 3:13-cv-04115-WHO Document 227 Filed 11/10/15 Page 6 of 6