Opinion ID: 150495
Heading Depth: 2
Heading Rank: 3

Heading: Class Certification And Settlement Proceedings

Text: After preliminarily approving the new settlement agreement, the District Court allowed class members to lodge objections to the class certification and the settlement. [6] Class objectors filed a total of thirty-four objections. All objections pertained to the proposed certification of, and recovery by, the indirect purchaser class; none of the direct purchasers objected to the settlement. The objectors raised two challenges to the propriety of certifying the two settlement classes. First, they argued that a nationwide class of indirect purchasers should not have been certified for the purpose of administering a monetary settlement of state law claims because antitrust, consumer protection, and unjust enrichment laws vary widely from state to state. [7] According to the objectors, those differences are of such magnitude that common questions of law or fact do not predominate with regard to the indirect purchaser class, thus making certification inappropriate under Rule 23(b)(3). Second, the objectors asserted that a nationwide class of both direct and indirect purchasers should not have been certified for the purpose of implementing injunctive relief because the market for rough gem diamonds became competitive during the pendency of this litigation. That competitive increase, they say, rendered an injunction to enforce compliance with antitrust statutes unnecessary and accordingly divested the indirect purchasers of antitrust standing to seek relief under Rule 23(b)(2). The District Court overruled both objections. Regarding Rule 23(b)(3) certification, the Court concluded that, while antitrust and consumer protection statutes vary from state to state, those differences are not so significant that they override class commonalities. Specifically, the Court held that class members share common issues of fact regarding whether De Beers actually fixed the price of rough gem diamonds and whether such price-fixing caused the plaintiffs to suffer an antitrust injury. The Court further noted that De Beers ... demanded a release of potential damage claims in all 50 states as a condition of the settlement and that certification of a nationwide class was therefore appropriate, even though the law of many jurisdictions limits or denies the right of indirect purchasers to recover for antitrust injuries. (App. at 279.) The Court also observed that the alleged harm was national in scope and that resolving all federal and state antitrust claims simultaneously benefit[ed] all class members by spreading litigation costs among Plaintiffs. (App. at 284.) With respect to the Rule 23(b)(2) injunctive relief, the Court held, without addressing objectors' description of competitive advances in the market, that all class members will continue to suffer ... harm. (App. at 285.) The Court rejected the objectors' argument that the class lacked antitrust standing, concluding that De Beers had stipulated as a factual matter that its conduct caused antitrust injury to all members of the direct and indirect purchaser classes. Thus, according to the Court, De Beers's concession provided a factual basis upon which to predicate class members' antitrust standing because De Beers has waived the right to demand proof of the substantive elements of the [antitrust] claims. (Id.) Accordingly, on May 22, 2008, the Court entered a final order certifying the direct and indirect purchaser classes under Rules 23(b)(2) and 23(b)(3). As ultimately certified, the direct purchaser class includes all sightholders who acquired rough gem diamonds directly from De Beers between September 20, 1997 and March 31, 2006. The indirect purchaser class includes all indirect purchasers who acquired gem diamonds between January 1, 1994 and March 31, 2006, regardless of whether their stones were supplied by De Beers or by one of its competitors. [8] Also on May 22, 2008, the Court entered a previously agreed-upon injunction. The injunction is framed to remain in effect for five years from its date of issuance, thus expiring on May 22, 2013. The objectors then filed the present appeals.