Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39724 Filed 03/17/22 Page 1 of 35
`
`UNITED STATES DISTRICT COURT
`
`FOR THE EASTERN DISTRICT OF MICHIGAN
`
`SOUTHERN DIVISION
`
`__________________________________________________________________
`IN RE: AUTOMOTIVE PARTS
`
`
`
`
`No. 12-md-02311
`ANTITRUST LITIGATION
`
`
`
`
`
`Hon. Sean F. Cox
`__________________________________________________________________
`
` CASE NO. 2:12-CV-00103
`
`
`
`IN RE : WIRE HARNESS
` CASE NO. 2:12-CV-00203
`IN RE : INSTRUMENT PANEL CLUSTERS
` CASE NO. 2:12-CV-00303
`IN RE : FUEL SENDERS
`
`
`
` CASE NO. 2:12-CV-00403
`IN RE : HEATER CONTROL PANELS
`
` CASE NO. 2:12-CV-00503
`IN RE : BEARINGS
`
`
`
`
` CASE NO. 2:12-CV-00603
`IN RE : OCCUPANT SAFETY SYSTEMS
` CASE NO. 2:13-CV-00703
`IN RE : ALTERNATORS
`
`
`
`IN RE : ANTI-VIBRATIONAL RUBBER PARTS CASE NO. 2:13-CV-00803
`IN RE : WINDSHIELD WIPERS
`
`
` CASE NO. 2:13-CV-00903
`IN RE : RADIATORS
`
`
`
`
` CASE NO. 2:13-CV-01003
`IN RE : STARTERS
`
`
`
`
` CASE NO. 2:13-CV-01103
`IN RE : AUTOMOTIVE LAMPS
`
`
` CASE NO. 2:13-CV-01203
`IN RE : SWITCHES
`
`
`
`
` CASE NO. 2:13-CV-01303
`IN RE : IGNITION COILS
`
`
`
` CASE NO. 2:13-CV-01403
`IN RE : MOTOR GENERATOR
`
`
` CASE NO. 2:13-CV-01503
`IN RE : STEERING ANGLE SENSORS
`
` CASE NO. 2:13-CV-01603
`IN RE : HID BALLASTS
`
`
`
` CASE NO. 2:13-CV-01703
`IN RE : INVERTERS
`
`
`
`
` CASE NO. 2:13-CV-01803
`IN RE : ELECTRONIC POWERED
`
` CASE NO. 2:13-CV-01903
`STEERING ASSEMBLIES
`
`
`
`IN RE : AIR FLOW METERS
`
`
`IN RE : FAN MOTORS
`
`
`IN RE : FUEL INJECTION SYSTEMS
`
`IN RE : POWER WINDOW MOTORS
`IN RE : AUTOMATIC TRANSMISSION
`FLUID WARMERS
`
`
` CASE NO. 2:13-CV-02003
` CASE NO. 2:13-CV-02103
` CASE NO. 2:13-CV-02203
` CASE NO. 2:13-CV-02303
` CASE NO. 2:13-CV-02403
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39725 Filed 03/17/22 Page 2 of 35
`
`IN RE : VALVE TIMING CONTROL DEVICES CASE NO. 2:13-CV-02503
`IN RE : ELECTRONIC THROTTLE BODIES
` CASE NO. 2:13-CV-02603
`IN RE : AIR CONDITIONING SYSTEM
`
` CASE NO. 2:13-CV-02703
`IN RE : WINDSHIELD WASHER
`
`
` CASE NO. 2:13-CV-02803
`IN RE : AUTOMOTIVE CONSTANT
`
` CASE NO. 2:14-CV-02903
`VELOCITY
`
` JOINT BOOT PRODUCTS
` CASE NO. 2:15-CV-03003
`
`
`IN RE : SPARK PLUGS
`
` CASE NO. 2:15-CV-03203
`
`
`IN RE : AUTOMOTIVE HOSES
` CASE NO. 2:15-CV-03303
`
`
`IN RE : SHOCK ABSORBERS
` CASE NO. 2:16-CV-03403
`
`IN RE : BODY SEALING PRODUCTS
` CASE NO. 2:16-CV-03503
`
`IN RE : INTERIOR TRIM PRODUCTS
` CASE NO. 2:16-CV-03603
`
`IN RE : BRAKE HOSES
`
`
` CASE NO. 2:16-CV-03703
`
`IN RE : EXHAUST SYSTEMS
`
` CASE NO. 2:16-CV-03803
`
`IN RE : CERAMIC SUBSTRATES
` CASE NO. 2:16-CV-03903
`
`IN RE : POWER WINDOW SWITCHES
` CASE NO. 2:16-CV-04003
`
`IN RE : AUTOMOTIVE STEEL TUBE
` CASE NO. 2:16-CV-04103
`IN RE : ACCESS MECHANISMS ACTIONS
` CASE NO. 2:17-CV-04303
`IN RE : DOOR LATCHES
`
`
`
`__________________________________________________________________
`THIS DOCUMENT RELATES TO:
`End-Payor Actions
`__________________________________________________________________
`
`MOTION TO ENFORCE END PAYOR SETTLEMENTS AND STRIKE
`CONTRADICTORY AND IMPROPER STIPULATION
`
`Enterprise Fleet Management, Inc. (“EFM”) respectfully moves the Court to
`
`enforce the express terms of the End Payor settlements, strike the contradictory and
`
`improper Class Action Capital, LLC Stipulation from the record, and instruct the
`
`Claims Administrator to process EFM’s claim according to the Court-approved
`
`Plans of Allocation.
`
`2
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39726 Filed 03/17/22 Page 3 of 35
`
`In support of this Motion, EFM relies upon and incorporates by reference
`
`herein the facts and legal arguments set forth in the accompanying Memorandum.
`
`In accordance with E.D. Mich. LR 7.1(a)(2), counsel for EFM explained the
`
`nature of the present motion to Class Counsel. Class Counsel has advised that they
`
`oppose the motion; Defendants take no position on the motion.
`
`March 17, 2022
`
`Respectfully submitted,
`
`
`
`
`
`By: /s/ Lawrence J. Lines III
`Lawrence J. Lines III
`Crowell & Moring LLP
`3454 Shakespeare Dr.
`Troy, MI 48084
`Telephone: (949) 798-1389
`Facsimile: (949) 263-8414
`Email: jlines@crowell.com
`
`Emma K. Burton
`Ann L. Rives
`Crowell & Moring LLP
`1001 Pennsylvania Avenue, NW
`Washington, DC 20004
`Telephone: (202) 624-2500
`Facsimile: (202) 628-5116
`Email: eburton@crowell.com
`
` arives@crowell.com
`
`Counsel for Enterprise Fleet
`Management, Inc.
`
`3
`
`Deborah E. Arbabi
`Daniel A. Sasse
`Crowell & Moring LLP
`3 Park Plaza, 20th Floor
`Irvine, CA 92614-8505
`Telephone: (949) 263-8400
`Facsimile: (949) 263-8414
`Email: darbabi@crowell.com
` dsasse@crowell.com
`
`
`
`
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39727 Filed 03/17/22 Page 4 of 35
`
`UNITED STATES DISTRICT COURT
`
`FOR THE EASTERN DISTRICT OF MICHIGAN
`
`SOUTHERN DIVISION
`
`__________________________________________________________________
`IN RE: AUTOMOTIVE PARTS
`
`
`
`
`No. 12-md-02311
`ANTITRUST LITIGATION
`
`
`
`
`
`Hon. Sean F. Cox
`__________________________________________________________________
`
` CASE NO. 2:12-CV-00103
`
`
`
`IN RE : WIRE HARNESS
` CASE NO. 2:12-CV-00203
`IN RE : INSTRUMENT PANEL CLUSTERS
` CASE NO. 2:12-CV-00303
`IN RE : FUEL SENDERS
`
`
`
` CASE NO. 2:12-CV-00403
`IN RE : HEATER CONTROL PANELS
`
` CASE NO. 2:12-CV-00503
`IN RE : BEARINGS
`
`
`
`
` CASE NO. 2:12-CV-00603
`IN RE : OCCUPANT SAFETY SYSTEMS
` CASE NO. 2:13-CV-00703
`IN RE : ALTERNATORS
`
`
`
`IN RE : ANTI-VIBRATIONAL RUBBER PARTS CASE NO. 2:13-CV-00803
`IN RE : WINDSHIELD WIPERS
`
`
` CASE NO. 2:13-CV-00903
`IN RE : RADIATORS
`
`
`
`
` CASE NO. 2:13-CV-01003
`IN RE : STARTERS
`
`
`
`
` CASE NO. 2:13-CV-01103
`IN RE : AUTOMOTIVE LAMPS
`
`
` CASE NO. 2:13-CV-01203
`IN RE : SWITCHES
`
`
`
`
` CASE NO. 2:13-CV-01303
`IN RE : IGNITION COILS
`
`
`
` CASE NO. 2:13-CV-01403
`IN RE : MOTOR GENERATOR
`
`
` CASE NO. 2:13-CV-01503
`IN RE : STEERING ANGLE SENSORS
`
` CASE NO. 2:13-CV-01603
`IN RE : HID BALLASTS
`
`
`
` CASE NO. 2:13-CV-01703
`IN RE : INVERTERS
`
`
`
`
` CASE NO. 2:13-CV-01803
`IN RE : ELECTRONIC POWERED
`
` CASE NO. 2:13-CV-01903
`STEERING ASSEMBLIES
`
`
`
`IN RE : AIR FLOW METERS
`
`
`IN RE : FAN MOTORS
`
`
`IN RE : FUEL INJECTION SYSTEMS
`
`IN RE : POWER WINDOW MOTORS
`IN RE : AUTOMATIC TRANSMISSION
`FLUID WARMERS
`
`
` CASE NO. 2:13-CV-02003
` CASE NO. 2:13-CV-02103
` CASE NO. 2:13-CV-02203
` CASE NO. 2:13-CV-02303
` CASE NO. 2:13-CV-02403
`
`
`
`i
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39728 Filed 03/17/22 Page 5 of 35
`
`IN RE : VALVE TIMING CONTROL DEVICES CASE NO. 2:13-CV-02503
`IN RE : ELECTRONIC THROTTLE BODIES
` CASE NO. 2:13-CV-02603
`IN RE : AIR CONDITIONING SYSTEM
`
` CASE NO. 2:13-CV-02703
`IN RE : WINDSHIELD WASHER
`
`
` CASE NO. 2:13-CV-02803
`IN RE : AUTOMOTIVE CONSTANT
`
` CASE NO. 2:14-CV-02903
`VELOCITY
`
` JOINT BOOT PRODUCTS
` CASE NO. 2:15-CV-03003
`
`
`IN RE : SPARK PLUGS
`
` CASE NO. 2:15-CV-03203
`
`
`IN RE : AUTOMOTIVE HOSES
` CASE NO. 2:15-CV-03303
`
`
`IN RE : SHOCK ABSORBERS
` CASE NO. 2:16-CV-03403
`
`IN RE : BODY SEALING PRODUCTS
` CASE NO. 2:16-CV-03503
`
`IN RE : INTERIOR TRIM PRODUCTS
` CASE NO. 2:16-CV-03603
`
`IN RE : BRAKE HOSES
`
`
` CASE NO. 2:16-CV-03703
`
`IN RE : EXHAUST SYSTEMS
`
` CASE NO. 2:16-CV-03803
`
`IN RE : CERAMIC SUBSTRATES
` CASE NO. 2:16-CV-03903
`
`IN RE : POWER WINDOW SWITCHES
` CASE NO. 2:16-CV-04003
`
`IN RE : AUTOMOTIVE STEEL TUBE
` CASE NO. 2:16-CV-04103
`IN RE : ACCESS MECHANISMS ACTIONS
` CASE NO. 2:17-CV-04303
`IN RE : DOOR LATCHES
`
`
`
`__________________________________________________________________
`THIS DOCUMENT RELATES TO:
`End-Payor Actions
`__________________________________________________________________
`
`MEMORANDUM IN SUPPORT OF MOTION TO ENFORCE END PAYOR
`SETTLEMENTS AND STRIKE CONTRADICTORY AND IMPROPER
`STIPULATION
`
`
`
`
`
`ii
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39729 Filed 03/17/22 Page 6 of 35
`
`STATEMENT OF THE ISSUES PRESENTED
`
`1. Whether Fleet Management Companies (FMCs) who purchased qualifying
`new vehicles not for resale and held title to those vehicles are Settlement
`Class Members:
`
`Answer: Yes. As Class Counsel has acknowledged in writing, and
`consistent with the clear Settlement Class definition, FMCs who purchased
`qualifying new vehicles and held title to those vehicles during the duration
`of any subsequent lease to FMC customers are Settlement Class Members,
`and their timely, valid claims should be processed according to the Court-
`approved Plans of Allocation.
`
`2. Whether the stipulated resolution regarding FMC class eligibility that Class
`Counsel negotiated privately with four FMCs and their third-party filer, but
`intends to apply to EFM and all other class members, is contrary to the
`Court-approved settlements and Plans of Allocation, and in violation of
`Illinois Brick jurisprudence as well as privity of contract principles:
`
`Answer: Yes. The Stipulation is improper and must be struck as it (a) denies
`FMCs the recovery to which they are entitled by purporting to exclude them
`from the Settlement Class, while simultaneously binding them to the class
`release; (b) excludes FMCs from the Settlement Class, but nonetheless
`provides a “service fee” payment to FMCs from the settlement fund, thereby
`diluting recovery for all class members who filed valid, timely claims; and
`(c) requires FMCs to pass on a portion of their claimed vehicle recovery to
`their own customers regardless of the customers’ nexus to a qualifying state
`under the settlements, and regardless of whether their customers filed valid,
`timely claims—thereby violating the approved Plans of Allocation that
`provide compensation only to eligible class members who submitted timely
`and valid claims.
`
`
`
`
`
`
`
`iii
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39730 Filed 03/17/22 Page 7 of 35
`
`CONTROLLING OR MOST APPROPRIATE AUTHORITIES
`
`In re Auto. Parts Antitrust Litig. (Anti-Vibration Rubber Parts), 997 F.3d 677 (6th
`
`Cir. 2021)
`
`Stromberg v. Qualcomm, Inc., 14 F.4th 1059 (9th Cir. 2021)
`
`In re Optical Disk Drive Antitrust Litig., 2016 WL 467444 (N.D. Cal. Feb. 8, 2016)
`
`
`
`
`
`
`
`iv
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39731 Filed 03/17/22 Page 8 of 35
`
`TABLE OF CONTENTS
`
`
`Page
`
`B.
`
`C.
`
`
`STATEMENT OF THE ISSUES PRESENTED .................................................... iii
`CONTROLLING OR MOST APPROPRIATE AUTHORITIES ...........................iv
` INTRODUCTION ......................................................................................... 1
`BACKGROUND ............................................................................................ 3
`ARGUMENT .................................................................................................. 5
`I.
`EFM is a member of the Settlement Class. ................................ 5
`A.
`Class Counsel acknowledged—in writing—as
`early as 2019 that fleet management companies are
`class members. ................................................................. 5
`The plain language of the settlements explicitly
`includes EFM as a member of the Settlement
`Class. ................................................................................ 7
`The express terms of EFM’s lease agreements
`place EFM squarely within the Settlement Class as
`EFM clearly owns its vehicles and holds title to
`those vehicles for the entire duration of any lease
`to its customers. ............................................................... 9
`The Court-approved class definition includes both
`owners and lessees, and the fact that valid claims
`were filed to the same vehicles by both is a product
`of the clear and unambiguous Settlement Class
`definition. ....................................................................... 10
`The CAC Stipulation violates the approved Plans of
`Allocation by compensating non-class members and class
`members who failed to file valid, timely claims, and
`raises serious concerns about the scope of the class
`release. ...................................................................................... 12
`A.
`The CAC Stipulation diminishes qualifying state
`claims in violation of Illinois Brick by allowing—
`in fact, requiring—FMCs to pass on settlement
`funds to their non-qualifying state customers. .............. 13
`
`D.
`
`II.
`
`
`
`
`
`v
`
`
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39732 Filed 03/17/22 Page 9 of 35
`
`TABLE OF CONTENTS
`(continued)
`
`Page
`
`B.
`
`C.
`
`D.
`
`The CAC Stipulation violates the approved Plans
`of Allocation by allowing—in fact, requiring—
`FMCs to pass on settlement funds to class
`members who failed to file timely claims, or any
`claim at all. ..................................................................... 17
`Class Counsel is improperly attempting to enforce
`the CAC Stipulation against EFM, as well as other
`FMCs not a party to the stipulation negotiations, in
`violation of basic privity of contract principles. ............ 19
`The CAC Stipulation raises significant questions
`about application of the class release, increasing
`the likelihood of protracted litigation and
`threatening to further delay distribution. ....................... 21
`
`vi
`
`
`
`
`
`
`
`
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39733 Filed 03/17/22 Page 10 of 35
`
`
`
`Federal Cases
`
`TABLE OF AUTHORITIES
`
` Page(s)
`
`In re Auto Parts Antitrust Litig. (Air Conditioning Systems),
`No. 2:13-cv-02703-SFC (E.D. Mich.) ............................................................ 7, 15
`
`In re Auto. Parts Antitrust Litig. (Anti-Vibration Rubber Parts),
`997 F.3d 677 (6th Cir. 2021) ............................................................................ 8, 9
`
`In re Auto Parts Antitrust Litig. (Heater Controls),
`No. 12-cv-00403-SFC (E.D. Mich.) ................................................................... 11
`
`In re Auto Parts Antitrust Litig. (Wire Harness),
`No. 12-cv-00103-SFC (E.D. Mich.) ............................................................. 16, 17
`
`E.E.O.C. v. Frank’s Nursery & Crafts, Inc.,
`177 F.3d 448 (6th Cir. 1999) .............................................................................. 20
`
`Hege v. Aegon USA, LLC,
`780 F.Supp. 2d 416 (D.S.C. 2011) ..................................................................... 18
`
`Illinois Brick Co. v. Illinois,
`431 U.S. 720 (1977) .....................................................................................passim
`
`In re Navistar Maxxforce Engines Marketing, Sales Practices and
`Products Liability Litigation,
`No. 1:14-cv-10318 (N.D. Ill.) ............................................................................. 12
`
`In re Optical Disk Drive Antitrust Litig.,
`No. 3:10-MD-2143 RS, 2016 WL 467444 (N.D. Cal. Feb. 8, 2016) ........... 14, 15
`
`Rodriguez v. W. Publ’g Corp.,
`563 F.3d 948 (9th Cir. 2009) .............................................................................. 20
`
`State Farm Mut. Auto. Ins. Co. v. Campbell,
`538 U.S. 408 (2003) ............................................................................................ 15
`
`Stromberg v. Qualcomm, Inc.,
`14 F.4th 1059 (9th Cir. 2021) ............................................................................. 16
`
`
`
`vii
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39734 Filed 03/17/22 Page 11 of 35
`
`
`
`In re TFT-LCD (Flat Panel) Antitrust Litig.,
`No. 10-cv-4945, 2013 WL 4175253 (N.D. Cal. July 11, 2013) ......................... 15
`
`State Cases
`
`Rockwood v. Hugg,
`129 N.W.2d 380 (Mich. 1964) ............................................................................ 20
`
`Other Authorities
`
`Ann. Manual Complex Lit. § 21.312 (4th ed.) ........................................................ 18
`
`Trial Handbook for Michigan Lawyers § 13:7 ........................................................ 20
`
`
`
`viii
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39735 Filed 03/17/22 Page 12 of 35
`
`
`
`INTRODUCTION
`
`Automotive Parts End Payor Settlement Class member Enterprise Fleet
`
`Management, Inc. (“EFM”) brings this motion to respectfully request that the Court
`
`enforce the express terms of the End Payor settlements, strike the contradictory and
`
`improper Class Action Capital, LLC (“CAC”) Stipulation from the record, and
`
`instruct the Claims Administrator to process EFM’s claim according to the Court-
`
`approved Plans of Allocation.1
`
`Under the clear class definition, EFM is a valid member of the Settlement
`
`Class, having purchased over a million qualifying new vehicles during the settlement
`
`time period. Not surprisingly, Class Counsel confirmed EFM’s class membership in
`
`written correspondence more than two years ago, and prior to EFM’s filing of a
`
`timely, valid claim. Now, in a complete reversal of its 2019 position, Class Counsel
`
`is attempting to exclude EFM and other similarly situated fleet management
`
`companies (“FMCs”) from the class. Class Counsel cannot unilaterally do this as the
`
`Settlement Class definition clearly and unambiguously includes EFM and other
`
`FMCs as entities that “purchased or leased a new Vehicle in the United States not
`
`for resale.” Had the settling parties wanted to exclude FMCs, they could have done
`
`
`1 This Motion relates to the distribution of settlement funds in all of the End Payor
`Actions and has, accordingly, been filed in Master File No. 12-md-02311. All
`citations are to the Master File unless otherwise noted. Should the Court prefer to
`receive separate Motions in each action, EFM will file in the individual cases, as
`well.
`
`
`
`1
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39736 Filed 03/17/22 Page 13 of 35
`
`
`
`so by including them in the list of express exclusions in the Settlement Agreements.
`
`They did not, and because the settlement language is “clear and unambiguous,” Class
`
`Counsel is now prohibited from attempting to remove EFM and other FMCs from
`
`their rightful place in the class.
`
` Equally, if not more, improper are the terms of the January 10, 2022,
`
`Stipulation that Class Counsel reached with CAC and four of its FMC clients to try
`
`to resolve any perceived issue with FMC eligibility. Despite negotiating with only a
`
`subgroup of FMCs, Class Counsel reached a stipulated resolution that requires all
`
`FMCs who submitted timely, valid claims to “pass on” 80% of any recovery from
`
`the settlement fund to their lessee customers, regardless of whether the customer
`
`filed a claim, or was ever even eligible to file a claim without any nexus to a
`
`qualifying state under Illinois Brick. In so doing, the CAC Stipulation clearly
`
`violates the Court-approved Plans of Allocation and the rights of all eligible class
`
`members who filed timely, valid claims.
`
`The CAC Stipulation also raises serious questions about the class release as
`
`to FMCs, who together purchased tens of millions of qualifying vehicles during the
`
`class period. If, as Class Counsel maintains, FMCs are simply indirect purchasers
`
`that passed costs through to their own customers and are thus excluded from the End
`
`Payor Settlement Class, they should not be paid any settlement proceeds and cannot
`
`be bound by the class release. But the CAC Stipulation provides a 20% “service fee”
`
`
`
`2
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39737 Filed 03/17/22 Page 14 of 35
`
`
`
`payment to FMCs from the class settlement fund, in direct contradiction to Class
`
`Counsel’s position that FMCs are not class members. Class Counsel cannot have it
`
`both ways; the flawed stipulated resolution they reached with a subgroup of FMCs
`
`and their third-party claim filer is no resolution at all, and will undoubtedly lead to
`
`further litigation concerning class membership and the scope of the class release,
`
`together with further associated delay.
`
`BACKGROUND
`
`
`
` Class member EFM purchased over a million qualifying new vehicles during
`
`the settlement time period and filed a valid and timely claim in advance of the June
`
`18, 2020, claim filing deadline. Declaration of Emma K. Burton attached as Exhibit
`
`A (“Burton Decl.”) ¶ 3; Declaration of Ryan C. Koenig attached as Exhibit B
`
`(“Koenig Decl.”) ¶ 3. Prior to claim filing, counsel for EFM corresponded with Class
`
`Counsel in 2019 to confirm fleet management companies’ inclusion in the settlement
`
`class, and EFM relied on Class Counsel’s acknowledgment in pursuing its claim to
`
`the End Payor settlements. Burton Decl. ¶ 4.
`
`Accordingly, after the September 15, 2021, filing of a Motion to Enforce the
`
`Settlement by four other FMCs referencing Class Counsel’s intent to now exclude
`
`FMCs from the class (ECF No. 2149), EFM moved quickly to contact Class Counsel
`
`to confirm that Class Counsel’s position with respect to FMC membership in the
`
`End Payor class was unchanged from its 2019 correspondence. Id. ¶¶ 6-7. To be
`
`
`
`3
`
`

`

`Case 2:12-md-02311-SFC-RSW ECF No. 2192, PageID.39738 Filed 03/17/22 Page 15 of 35
`
`
`
`clear, the other FMCs’ motion was the first time EFM learned that Class Counsel
`
`even had any question as to FMC membership in the End Payor class, given the fact
`
`that the class definition plainly included FMCs and particularly given Class
`
`Counsel’s 2019 written confirmation.2 Burton Decl. ¶ 12. Over the course of the
`
`nearly four months that followed, counsel for EFM contacted Class Counsel no less
`
`than ten times in an effort to be included in resolution of any perceived issues with
`
`FMC inclusion in the class. Id. ¶ 10. During this time, Class Counsel moved for five
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`separate extensions to the briefing deadlines for Response and Reply to the original
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`FMC motion to enforce, each time assuring EFM that filing its own motion to
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`enforce the settlements would be premature.
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`Significantly, Class Counsel refused to disclose to EFM any details of its
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`discussions with the other FMCs or their third-party filer CAC, and disclosed none
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`of the terms of what ultimately became CAC’s Stipulation, despite the fact that Class
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`Counsel later revealed its intent to apply the Stipulation terms to all FMCs, EFM
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`2 EFM has received no correspondence or other communication from the Claims
`Administrator denying or otherwise limiting its claim and the present Motion is
`necessitated by communications with Class Counsel and the CAC Stipulation
`entered January 10, 2022. Burton Decl. ¶ 5. It is worth noting that the Motion to
`Enforce the Settlements filed by four other FMCs on September 15, 2021,
`advocated for FMC inclusion in the End Payor class and raised substantially
`similar arguments to those raised here by EFM. Id. ¶ 6. The other FMCs withdrew
`that Motion only after negotiating what would ultimately become the CAC
`Stipulation with Class Counsel. Id. ¶ 10.
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`4
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`included. Id. ¶¶ 10-11, 13. In so doing, Class Counsel effectively locked EFM out
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`of negotiating resolution of the FMC issue and now seeks to enforce against EFM a
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`Stipulation that it was afforded no part in crafting, and which contradicts both the
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`class definition and Class Counsel’s prior written representations concerning FMC
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`class membership. In fact, the first EFM learned of the terms of the CAC Stipulation
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`was when it was docketed with the accompanying Order.3 Id. ¶ 12. Following the
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`filing of the CAC Stipulation, EFM again made numerous attempts to negotiate with
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`Class Counsel, but the parties were unable to reach a resolution. Id. ¶¶ 13-14.
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`Accordingly, the present Motion is the timely culmination of months of good
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`faith effort by EFM to confirm its inclusion in the End Payor class with Class
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`Counsel, consistent with their prior representation and the Court-approved class
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`definition—and raising serious concerns about the inequity of the CAC Stipulation
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`once it was docketed—to no avail.
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`I.
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`EFM is a member of the Settlement Class.
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`ARGUMENT
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`A. Class Counsel acknowledged—in writing—as early as 2019 that
`fleet management companies are class members.
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`Class Counsel explicitly acknowledged in written correspondence in 2019 that
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`FMCs who purchase new vehicles and hold title to those vehicles are members of
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`3 The proposed CAC Stipulation was not docketed or otherwise made available for
`public review prior to the Court’s January 10, 2022, Order. Burton Decl. ¶ 12.
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`5
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`the End Payor class. In response to a written request to confirm that FMCs who
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`purchase and hold title to new vehicles are within the class definition and not
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`otherwise excluded from the class by virtue of leasing their vehicles out to customers
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`under long term leases, Class Counsel wrote:
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`“As discussed on our call, we will address many of the issues related to
`fleet management companies on a case-by-case basis. However,
`assuming for purposes of this response that the fleet management
`company at issue purchased new vehicles and retained title to those
`new vehicles while leasing them to customers under long term leases,
`those fleet management companies would be included in the class.”
`
`
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`Exh. 1 to Burton Decl. (emphasis added).
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`Class Counsel’s position in 2019 was clear and unambiguous, and it was
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`consistent with the class definition. EFM relied on Class Counsel’s representation in
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`pursuing claims to the End Payor settlements as EFM indisputably satisfied Class
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`Counsel’s conditions by (a) purchasing new vehicles, and (b) retaining title to those
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`new vehicles while leasing them to customers under long term leases. Koenig Decl.
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`¶¶ 4, 7. Now, despite the clear class definition and prior explicit representation
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`confirming FMC class membership, Class Counsel is taking the opposite position,
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`claiming that FMCs are simply indirect purchasers that passed costs through to their
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`own customers and are therefore somehow excluded from the Settlement Class. See
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`Element Fleet Corp. et al.’s Mem. ISO Mot. to Enforce Settlement Agreements, ECF
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`No. 2149, PageID.39514. Not only is Class Counsel’s current position diametrically
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`6
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`opposite its express written position in 2019, but it is contrary to the clear language
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`of the End Payor settlements and EFM’s own lease agreements.
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`B.
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`The plain language of the settlements explicitly includes EFM as a
`member of the Settlement Class.
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`The End Payor settlements clearly define Settlement Class Members as: “All
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`persons and entities that . . . purchased or leased a new Vehicle in the United States
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`not for resale, which included one or more [of the applicable component parts].”
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`E.g., Round 4 Mitsubishi Settlement Agreement, In re Air Conditioning Sys., No.
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`2:13-cv-02703-SFC, ECF No. 184-2, PageID.4681. It is undisputed that all of
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`EFM’s claimed vehicles were purchased new. Koenig Decl. ¶ 4. Likewise, there is
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`no dispute that any of EFM’s claimed vehicles were purchased for resale—they were
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`not. Id. EFM took title to its claimed vehicles, and held title for the entirety of its
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`period of ownership, including for the duration of any lease of those vehicles to its
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`own customers. Id. ¶ 7
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`Class Counsel does not dispute that EFM’s claimed vehicles were purchased
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`new. Likewise, Class Counsel does not attempt to assert that EFM’s claimed
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`vehicles were purchased for resale. Nevertheless, Class Counsel now seeks to
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`exclude EFM from the Settlement Class based solely on their new theory that FMCs
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`are not “end payors” under antitrust law.
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`But whether FMCs are “end payors” under antitrust law is wholly irrelevant
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`here in light of the approved class definition in the Settlement Agreements, which
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`7
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`renders moot the question of whether FMCs are or are not “end payors.” As the
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`Sixth Circuit recently noted, “Whether Plaintiffs can maintain their direct-purchaser
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`lawsuit under the ownership-or-control exception of Illinois Brick is a question of
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`antitrust standing. It is not a question that bears on our interpretation of the
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`settlement agreements.” In re Auto. Parts Antitrust Litig. (Anti-Vibration Rubber
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`Parts), 997 F.3d 677, 683 (6th Cir. 2021) (“Rubber Parts”) (emphasis added). The
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`settling parties reached settlements precisely to avoid litigating such questions of
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`law (and fact), and the Settlement Agreements approved by this Court include a clear
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`and unambiguous definition of the Settlement Class. There is no question that EFM
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`fits squarely within that Settlement Class definition, which should end any dispute
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`as to whether EFM is a class member entitled to the compensation it is rightly due
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`for its timely, valid claim.
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`Moreover, the settling parties here knew how to draft express exclusions from
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`the Settlement Class and from the class-wide release—neither of which expressly
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`exclude FMCs or, to invoke Class Counsel’s new theory, indirect purchasers that
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`passed costs through to other individuals or entities. In fact, the release includes
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`express exclusions that permit only expressly-identified indirect purchasers to bring
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`federal antitrust claims against Defendants, and FMCs are not among those expressly
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`identified exclusions. Surely Defendants did not agree to billion-dollar settlements
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`only to continue to face potential litigation from FMCs who together purchased tens
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`8
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`of millions of qualifying vehicles during the relevant period. Class Counsel’s
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`position here is untenable.
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`Further, under Michigan law, where—as here—contractual language is clear
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`and unambiguous, terms are to be taken and understood in their plain, ordinary, and
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`popular sense, and courts interpreting such contracts “look only within the four
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`corners of the relevant contracts to accomplish [that] task.” Rubber Parts, 997 F.3d
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`at 681 (citing the Michigan Court of Appeals). Accordingly, the Court must look no
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`further than the Settlement Agreements and the clear and unambiguous definition of
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`the Settlement Class to find that EFM is a valid Class Member.
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`C. The express terms of EFM’s lease agreements place EFM
`squarely within the Settlement Class as EFM clearly owns its
`vehicles and holds title to those vehicles for the entire duration of
`any lease to its customers.
`
`The terms of EFM’s lease agreements make clear that it is a member of the
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`Settlement Class. EFM, like most FMCs, purchases and takes title to its vehicles,
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`maintaining exclusive ownership while its customers are granted only the right to
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`use and possession of the vehicle during the term of the lease. Koenig Decl. ¶¶ 6-7.
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`EFM’s standard lease language includes express terms consistent with EFM’s
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`(“Lessor’s”) position as vehicle owner and limitation of its customer’s (“Lessee’s”)
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`rights:
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`
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` “Lessor is the sole legal owner of each Vehicle.”
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`9
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` “This Agreement is a lease only and Lessee will have no right, title or
`interest in or to the Vehicles except for the use of the Vehicles as
`described in this Agreement.”
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` “This Agreement shall be treated as a true lease for federal and
`applicable state income tax purposes with Lessor having all benefits of
`ownership of the Vehicles.”
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` “Each Vehicle will be titled and licensed in the name designated by
`Lessor.”
`
`Ex. 1 to Koenig Decl.
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`Like most FMCs, the vast majority of EFM’s leases are open-ended TRAC
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`(Terminal Rental Adjustment Clause) leases, commonly used for titled equipment
`
`like vehicles, and different from the leases used by automotive dealerships in leasing
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`vehicles to individual consumers. Koenig Decl. ¶ 5. Importantly, TRAC leases like
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`EFM’s are not considered sales and there is no basis in stat