United States District Court, E.D. Pennsylvania
STANFORD GLABERSON, et al.
COMCAST CORPORATION, et al.
JOHN R. PADOVA, District Judge.
AND NOW, this 12th day of December, 2014, upon consideration of Plaintiffs' Motion for Certification of a Settlement Class and Preliminary Approval of Class Action Settlement (Docket No. 608), Defendants' Response thereto (Docket N. 609), and the arguments of counsel at oral argument held on December 9, 2014, IT IS HEREBY ORDERED that the Motion is GRANTED.
On December 8, 2003, Plaintiff Stanford Glaberson and other plaintiffs filed this class action on behalf of subscribers to video programming services (other than solely to basic cable services) in sixteen counties in Pennsylvania, New Jersey, and Delaware provided by Defendants Comcast Corporation, Comcast Holdings Corporation, Comcast Cable Communications Inc., Comcast Cable Communications Holdings Inc., and Comcast Cable Holdings LLC (collectively "Comcast"). Plaintiffs alleged that Comcast had, inter alia, unlawfully divided and allocated markets and engaged in other conduct in violation of Sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and 2) in the Philadelphia, Pennsylvania area that reduced and deterred overbuilder competition and allegedly caused Plaintiff and the putative class to pay supracompetitive prices. Plaintiff and other putative class representatives subsequently filed an Amended Class Action Complaint on February 20, 2004; a Second Amended Class Action Complaint on May 17, 2004; and a Third Amended Consolidated Class Action Complaint on May 23, 2006. Each iteration alleged that Defendants had also unlawfully divided and allocated markets and engaged in other conduct in violation of Sections 1 and 2 of the Sherman Act in the Chicago, Illinois, area and asserted claims on behalf of two classes (a "Philadelphia Class" and a "Chicago Class") for treble damages and injunctive relief. On April 15, 2014, the claims on behalf of the Chicago Class were withdrawn. On April 16, 2014, Plaintiff filed the currently operative Fourth Amended Class Action Complaint (the "Complaint") alleging similar claims solely on behalf of a revised Philadelphia Settlement Class (as further defined below) consisting of Comcast subscribers in five Pennsylvania counties. Comcast denies Plaintiff's allegations. The parties have reached a tentative settlement, and Plaintiffs now move for (1) certification of a settlement class, and (2) preliminary approval of the settlement.
I. CERTIFICATION OF SETTLEMENT CLASS
A proposed class settlement must satisfy the requirements of Federal Rule of Civil Procedure 23(a), that is, that "(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." Fed.R.Civ.P. 23(a), see aslo Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 620 (1997) (requiring proponents of class certification to demonstrate that all of the Rule 23(a) requirements are met). Additionally, "the proposed class must satisfy at least one of the three requirements listed in Rule 23(b)." Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541, 2548 (2011). Under Rule 23(b)(3), a class action may be maintained if "the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed R. Civ. P. 23(b)(3). "A party seeking class certification must affirmatively demonstrate his compliance with" Rule 23. Dukes, 131 S.Ct. at 2551. "Class certification is proper only if the trial court is satisfied, after a rigorous analysis, that the prerequisites' of Rule 23 are met." In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 309 (3d Cir. 2008) (quoting Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161 (1982)).
The Court finds that Plaintiffs satisfy all requirements for certification of the Philadelphia Settlement Class, specifically the criteria set out in Federal Rules of Civil Procedure 23(a) and 23(b)(3). We make the following findings with regard to Rule 23(a):
1. The parties agree that the number of persons who currently subscribe or who subscribed to Comcast's video programming services (other than solely to basic cable service) between January 1, 2003 and December 31, 2008 in the counties of Bucks, Chester, Delaware, Montgomery and Philadelphia, Pennsylvania is at least 800, 000. Accordingly, this Court finds that the numerosity requirement is satisfied.
2. Plaintiffs allege, inter alia, that Comcast entered into a series of market allocating swap and acquisition agreements with other cable companies that caused all class members to be harmed by paying supracompetitive prices. Plaintiffs further allege that all class members paid supracompetitive prices because of anticompetitive conduct. Accordingly, this Court finds that the commonality requirement is satisfied.
3. Plaintiffs allege, inter alia, that Comcast's swaps and acquisitions reduced and deterred overbuilder competition and enabled Comcast to raise prices to supracompetitive levels, thereby injuring all Class members in the same manner. Accordingly, this Court finds that the typicality requirement is satisfied.
4. The adequacy requirement under Federal Rule of Civil Procedure 23(a)(4) has two requirements: (1) "the interests of the named plaintiffs must be sufficiently aligned with those of the absentees, " and (2) "class counsel must be qualified and must serve the interests of the entire class." Georgine v. Amchem Prods, Inc., 83 F.3d 610, 630 (3d Cir. 1996). We find that Plaintiff Glaberson was a subscriber of video programming services from Comcast, other than solely basic cable services, during the relevant period from January 1, 2003 to December 31, 2008. Accordingly, there are no conflicts that would render the named Plaintiff an inadequate representative of the Class at large. Co-Lead Class Counsel Barry Barnett, Esq. of Susman Godfrey L.L.P. and David Woodward, Esq. of Heins, Mills & Olson, P.L.C. have extensive experience and expertise in antitrust, class action, and complex civil litigation, and have successfully prosecuted antitrust class actions and other similar cases in courts in this district and throughout the United States, including, for the last decade, this Action. Accordingly, this Court finds that the adequacy of representation requirement is satisfied.
We find that the newly described class satisfies the predominance and superiority requirements of Rule 23(b)(3). Rule 23(b)(3) requires us to find "that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). We previously held that Plaintiffs' liability theory, that Comcast's conduct reduced and deterred overbuilder competition, was capable of class-wide proof. See Behrend v. Comcast Corp., 264 F.R.D. 150, 165 (E.D. Pa. 2010). The Supreme Court did not disturb this finding on appeal; it only found that Plaintiffs' damages model was improper because it failed to measure only the antitrust impact attributable to that liability theory. Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013). Additionally, in adjudicating Comcast's Motion pursuant to Federal Rule of Civil Procedure 56, we held that "the Class can proceed to trial on Count I of the Third Amended Complaint, the Sherman Act section 1 rule of reason claim, based upon the theory that Comcast's creation of the Philadelphia cluster through its acquisition of competing cable companies and its swapping of cable assets constituted a horizontal allocation of markets." Behrend v. Comcast Corp., Civ. A. No. 03-6604, 2012 WL 1231794, at *33 (E.D. Pa. Apr. 12, 2012).
We find that Plaintiffs' additional expert reports from Dr. Michael Williams and Dr. James T. McClave are evidence that is common to the Class supporting their theory that Comcast's swaps and acquisitions constituted unlawful horizontal market allocations and that Comcast engaged in other anticompetitive conduct directed toward RCN, Inc. that reduced overbuilder competition and caused all Class members to pay supracompetitive prices. These expert reports provide common proof of antitrust injury in fact and tie damages directly to liability and Plaintiffs' theory of antitrust impact. Accordingly, we conclude that Plaintiffs have satisfied the predominance requirement for settlement purposes because common questions present a significant aspect of the case and may be resolved for all Class members in a single common judgment.
We also find that Plaintiffs satisfy the superiority requirement. "The requirement that a Section (b)(3) class action be the superior' method of resolving the claims ensures that there is no other available method of handling it which has greater practical advantages." Behrend v. Comcast Corp., 245 F.R.D. 195, 206 (E.D. Pa. 2007) (citations omitted). Rule 23(b)(3) identifies various factors as pertinent to a superiority finding, including class members' interests in pursuing separate actions, the extent of any independent litigation already begun by class members, the desirability of concentrating the litigation in this forum, and the difficulties likely to be encountered in the management of a class action. Fed.R.Civ.P. 23(b)(3)(A)-(D). See also Amchem, 521 U.S. at 615 (noting that the superiority requirement ensures that resolution by a class action will "achieve economies of time, effort, and expense, and promote... uniformity of decisions as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results'" (citation omitted)).
We previously ruled that Plaintiffs satisfied the superiority requirement of Rule 23(b)(3) with respect to a broader proposed Philadelphia-area class. Behrend, 245 F.R.D. at 212, which was not disturbed on appeal. We find that the superiority requirement continues to be satisfied because the proposed settlement will "achieve economies of time, effort, and expense, and promote... uniformity of decisions as to persons similarly situated." Amchem, 521 U.S. at 615. Such economies will be achieved for both litigants and the Court, avoiding hundreds of thousands of individual adjudications that would otherwise place a "potentially crushing strain on and inefficient application of judicial resources." See In re Processed Egg Prods. Antitrust Litig., 284 F.R.D. 278, 294 (E.D. Pa. 2012); see also In re Prudential Ins. Co. Am. Sales Practice Litig., 148 F.3d 283, 315-16 (3d Cir. 1998); In re Wellbutrin SR Direct Purchaser Antitrust Litig., Civ. A. No. 04-5525, 2008 WL 1946848, at *9 (E.D. Pa. May 2, 2008) (stating that "denying certification would require each direct purchaser to file suit individually at the expense of judicial economy and litigation costs for each party" (citation omitted)); Meijer, Inc. v. Warner Chilcott Holdings Co. III, Ltd., 246 F.R.D. 293, 313 (D.D.C. 2007) (reasoning that "[t]his action involves the resolution of numerous complex issues of law and fact common to all putative class members" and that "[a]s class certification provides the opportunity for an efficient resolution of these substantial issues for the entire class in a single forum, the Court concludes that the class action mechanism is a superior litigation approach in this case" (internal citation omitted)); In re Relafen Antitrust Litig., 218 F.R.D. 337, 346 (D. Mass. 2003) (finding superiority and noting that "it appears that resolution by class action would provide substantial savings in time, effort, and expense"). ...