1. A proposed class action was commenced in Ontario in 2005 against a group of manufacturers and distributors of Dynamic Random Access Memory (“DRAM”). A second proposed class action was commenced in Ontario in 2010 against a further group of manufacturers and distributors of DRAM.
2. The actions allege that the defendants conspired to fix the price at which DRAM was sold in Canada and worldwide during the period April 1, 1999 to June 30, 2002.
3. DRAM is the most commonly used semiconductor memory product, providing high-speed storage and retrieval of electronic information for a wide variety of computer, telecommunications and consumer electronics products. The defendants were the primary manufacturers and distributors of DRAM for supply to consumers and to original equipment manufacturers of a wide variety of products including personal computers, laptop computers, workstation computers and servers.
4. The law firms of Sutts, Strosberg LLP and Harrison Pensa LLP are prosecuting the Ontario actions together. Companion class actions are being prosecuted in British Columbia and Québec. Counsel in the three jurisdictions are working co-operatively to prosecute the actions nationally with British Columbia and Québec taking the lead.
5. The plaintiffs in the actions across Canada have reached national settlements with seven sets of defendants which have been approved by the courts in the three jurisdictions. The settling defendants did not admit liability but they agreed to pay in total $67.275 million for the benefit of the settlement class members and to provide co-operation to the plaintiffs in prosecuting the actions against the non-settling defendants.
6. A full definition of class members may be found in the FAQ section of this website. The deadline set by the Courts for persons not wishing to participate in the class actions expired June 2, 2012, before the first settlement approval.
7. The net settlement funds from the seven settlements are being held in trust for the benefit of class members pending approval by the Courts of a Distribution Protocol.
ADDITIONAL PROPOSED SETTLEMENTS
8. The plaintiffs in the actions across Canada have now reached additional proposed national settlements with four sets of defendants: Mitsubishi, Toshiba, Winbond and Infineon. The settling defendants did not admit liability but they agreed to pay in total $12.195 million for the benefit of the settlement class members. The settlement agreements may be reviewed in the Documents section of this website.
9. The Courts in the three jurisdictions have certified/authorized the actions as class actions against the settling defendants for settlement purposes only.
10. The Courts will be asked to approve the settlement agreements with these groups of defendants and approved Class Counsel fees of 30% of the total settlement amounts at hearings to be held in Montreal on September 5, 2014, Vancouver on September 8, 2014 and Toronto on September 19, 2014. The short form Notice of Hearings may be reviewed here (English) (French). The long form Notice of Hearings may be reviewed in the Documents section of this website.
11. The plaintiffs will also seek to discontinue against the one remaining set of defendants: Mosel, who have been through insolvency proceedings.
12. The plaintiffs and Class Counsel have been engaged in developing a Distribution Protocol and a claims process for some time now. For the purposes of constructing the proposed Distribution Protocol, Sutts Strosberg represents the interests of the indirect purchasers who are not end users, Harrison Pensa represents direct purchasers who are not end users, and Belleau Lapointe represents end users of DRAM and DRAM products.
13. The Honourable Ian Binnie, a retired justice of the Supreme Court of Canada, and Dr. Thomas Ross, a senior economist with the Sauder School of Business, were retained to provide independent advice and findings for the Courts about how to distribute the funds among class members.
14. At a hearing held in Toronto on May 12, 2014, the parties recommended a Distribution Protocol to Mr. Binnie. A copy of the proposed Distribution Protocol may be reviewed here (English) (French). Dr. Ross also provided Mr. Binnie with his opinions concerning the proposed Distribution Protocol. Dr. Ross’ reports can be reviewed at the Documents section of this website.
15. Mr. Binnie concluded that the proposed Distribution Plan is fair, reasonable and adequate and consistent with the prior case law. Mr. Binnie’s report to the Courts may be reviewed in the Documents section of this website.
16. The Courts will be asked to approve the Distribution Protocol and claims process and appoint an administrator at the hearings to be held in Montreal on September 5, 2014, Vancouver on September 8, 2014 and Toronto on September 19, 2014. The short form Notice of Hearings may be reviewed here (English) (French). The long form Notice of Hearings may be reviewed in the Documents section of this website.
17. Once a Distribution Plan is approved, class members will be required to file a claim for payment in a claims process. Class members who have proof of purchase of DRAM and DRAM products purchased during the period April 1, 1999 to June 30, 2002 should retain those proofs of purchase. Class Counsel recognize that not all class members will have proofs of purchase and have constructed the claims process and methods of proof of a claim with this in mind.
THE PLAN TO PAY THE SETTLEMENT AMOUNTS
18. Please note that the explanations given in this section are very broad in nature and should not, under any circumstances, be interpreted as having priority over the rules set out in the Distribution Protocol.
19. The plan to pay the settlement amounts is based on two variables: the quantity of DRAM purchased by each class member, and the class member’s position in the DRAM distribution chain.
20. Given that DRAM is contained in a very wide range of products, and that its quantity and price have greatly varied over time, the plan to pay the settlement amounts is based on a common unit of measurement. This unit is the “Computer Equivalent Unit” (“CEU”). One CEU is defined as the average DRAM content of a computer in the class period. CEU values have been assigned to various products which contain DRAM, so that class members can simply identify those products that they purchased, and the Claims Administrator can calculate and assign a total CEU value for the purposes of their claim. For class members who purchased raw DRAM or DRAM in large quantities, there is an additional schedule for assigning a CEU value to those purchases in a straightforward manner. The following table provides a few examples:
|CEU of some DRAM products|
|Computers - laptops or desktops||1.00|
|Video game consoles||0.10|
|Servers||1.00 CEU per $3,400 CDN spent|
21. Since the class contains people at different positions on the DRAM distribution chain, some class members have absorbed a larger overcharge due to the price fixing, whereas others were able to pass on part of the overcharge to lower levels of the distribution chain. For that reason, the plan to pay settlement funds assigns a different monetary value to a CEU depending on the position in the DRAM distribution chain of the person making the claim. The identified positions are as follows:
|Distribution Chain||CEU Value|
|Electronics Manufacturing Services (“EMS”)||$1.25|
|Manufacturers of computer DRAM products for commercial resale to government or education entities||$1.25|
|Manufacturers of computer DRAM products for commercial resale to non-government/education entities||$0.63|
|Manufacturers of non computer DRAM products for commercial resale||$0.42|
|Resellers of computer and non computer DRAM products without modifications||$0.42|
|Manufacturers or Resellers with stranded DRAM inventory||$2.50|
22. End Consumers will receive the greater of $20.00 or the value of their CEU claim. For example, a household End Consumer who purchased 2 computers and 1 server will receive $20.00 (even though the value of their claim is 3 CEUs x $5.00) while a small business End Consumer who purchased 20 computers and 5 servers would receive $125.00 (25 CEUs x $5.00).
23. In order to avoid some class members taking a disproportionate share of the settlement amounts, the available monies are divided into three funds. A class member’s claim will be paid from the applicable fund. The three funds are as follows:
|1||End Consumers Fund||50%|
|3||Other DRAM Purchasers Fund
24. In the event the value of the claims against any fund is greater than the amount of money in that fund, the CEU values associated with that fund will be proportionately decreased.
25. In order to obtain more details on the plan to pay the settlement amounts, you can consult the Distribution Protocol in the Documents section of this website.
26. Monitor this website periodically for updates on the class actions, the future distribution approval hearings and future claims process.
27. For more information, you may review the settlement agreements and other documents in the Documents section of this site, as well as the Frequently Asked Questions section. Pour de plus amples information en français, vous pouvez consulter le site internet: www.recourscollectif.info/fr/dossiers/dram/.
28. If you would like to speak to someone at Sutts, Strosberg LLP about these class actions, please use our toll free line 1.800.229.5323, extension 8296.
29. If you would like to know more about how a class action works, click here.