Dynamic Accident Lawyers: Auto Hose Maker Toyoda Gosei Hit With Price Fixing Class Action

toyoda-gosei-north-america--250 A class action complaint has accused Toyoda Gosei Co.—a Japanese company that makes hoses for automobiles—of violating antitrust laws. Specifically, the complaint alleges that since 2004 Toyoda Gosei has met with competitors and agreed to artificially increase the prices of its car hoses.

Plaintiff VITEC LLC, is a Michigan company that makes fuel tanks, and purchased hoses from Toyoda Gosei. The automotive parts class action lawsuit states that Toyoda Gosei pled guilty to criminal antitrust charges based on of a federal investigation by the FBI and prosecution by the U.S. Dept. of Justice. As a result, the company paid a fine of $26 million and a former executive agreed to spend a year in prison.

The conviction of Toyoda Gosei was part of a larger motor vehicle parts antitrust conspiracy, which is “the largest criminal investigation [the DOJ] has ever pursued,” according to the Toyoda class action lawsuit.

The complaint cites one FBI investigator as saying, “When companies partner to control and price fix bids or contracts, it undermines the foundation of the United States’ economic system.” To date, the DOJ and FBI investigation has led to 25 companies pleading guilty to antirust violations, and paying more than $2.5 billion in fines.

The Toyoda Gosei antirust class action lawsuit explains that automotive hoses are used in new car manufacturing, and bids go out to auto parts makers three years before the cars go into production. Parts makers like Toyoda Gosei then bid on those contracts, which are expected to last four to six years. Typically, the lowest bid gets the contract.

According to the antitrust lawsuit, Toyoda Gosei and its competing hose manufacturer agreed ahead of time which company would get the contract. While other companies would submit bids that were higher, they were allegedly close enough to still look competitive.

Those bids set the prices for automotive hoses both for the automobile manufacturer and any third parties making parts for that auto company, like VITEC. Thus, VITEC claims that because the antitrust conspiracy, it paid “supra-competitive” prices, and was “deprived of the benefits of free, open, and unrestricted competition in the market for Automotive Hoses.”

The Toyoda Gosei antitrust class action lawsuit seeks damages for everyone who purchased auto hoses directly from the company since Feb. 1, 2004. Direct purchasers typically were the automobile manufacturers themselves, as well as companies like VITEC that built other parts that went into new vehicles.

Plaintiff VITEC LLC, is represented by David H. Fink and Darryl Bressack of Fink + Associates Law; Gregory P. Hansel, Randall B. Weill, Jonathan G. Mermin, and Michael S. Smith of Preti Flaherty Beliveau & Pachios LLP; Steven A. Kanner, William H. London, and Michael E. Moskovitz of Freed Kanner London & Millen LLC; Jospeh C. Kohn, William E. Hoese, and Douglas A. Abrahams of Kohn Swift & Graf, P.C.; Eugene A. Spector, William G. Caldes, Jonathan M. Jagher, and Jeffrey L. Spector of Spector Roseman Kodroff & Willis, P.C.; Joseph M. Fischer of Carson Fischer, PLC; and Irwin B. Levin of Cohen & Malad, LLP.

The Toyoda Gosei Automotive Hoses Antitrust Class Action Lawsuit is Vitec LLC, v. Toyoda Gosei Co. Ltd., et al., Case No. 2:16-cv-10001, in the U.S. District Court for the Eastern District of Michigan, Southern Division.

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