NEW YORK AK Steel Corp. and Gerdau Ameristeel Corp. could help steel fabricators in a federal antitrust lawsuit by providing information against other defendants if a legal settlement scheduled for a July 10 hearing in U.S. District Court in Illinois is approved.
If the settlement is implemented, West Chester, Ohio-based AK Steel and Tampa, Fla.-based Gerdau will assist the plaintiff steel consumers with witnesses for interviews as well as documents.
Scranton, Pa.-based Standard Iron Works filed the original lawsuit in September 2008 alleging that eight major steelmakers colluded to restrict steel production and influence prices.
"This cooperation from settling defendants reduces the risks associated with obtaining important, admissible conspiracy evidence for trial against the remaining defendants," attorneys for the plaintiff wrote in an April settlement proposal.
AK Steel and Gerdau joined Irving, Texas-based Commercial Metals Co. (CMC) in settling the lawsuit in April, court documents show. AK Steel will pay $5.8 million and Gerdau will pay $6.1 million, according to the settlement agreement. CMC will pay $4 million to settle the case (amm.com, March 14) and also will cooperate with the plaintiffs, according to the proposed agreement.
The total $15.9 million will be paid into a settlement fund. Part of the fund will reimburse steel buyers that bought steel for U.S. delivery from the defendants from April 2005 to December 2007, while some could go toward legal costs. The lawsuit could cover up to 5,500 class-action members, according to the plaintiffs.
All three settling parties have denied wrongdoing but agreed to the settlement to avoid costly litigation.
"Gerdau believes the claims in the lawsuit lack merit and it defended itself well against the allegations. ... The settlement contains no admission of liability from the company," Gerdau said in a statement.
Other parties to the case declined comment or did not return requests for comment.
Remaining defendants in the case are Chicago-based ArcelorMittal USA LLC, Pittsburgh-based U.S. Steel Corp., Charlotte, N.C.-based Nucor Corp., Fort Wayne, Ind.-based Steel Dynamics Inc. and Lisle, Ill.-based SSAB Americas. The initial complaint alleged that the companies slowed down furnace production and raw steel output to raise or fix prices for steel products.
AK Steel booked the $5.8-million settlement charge for its first quarter of 2014, the company told AMM.
Parties to the settlement have set up a website, www.steelantitrustsettlement.com, which outlines settlement details. Members of the class, or those affected by the alleged actions, can object to the settlement and appear at the July hearing. Some 30 million transaction records and millions of pages of documents were combed through during the years-long discovery process.
It is not yet known how much money those affected by the lawsuit could receive due to the settlement, nor when the money might be disbursed.