Miami Products & Chemical Co. v. Olin Corporation

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF NEW YORK

_____________________________________

MIAMI PRODUCTS & CHEMICAL CO.,

On Behalf of Itself and All Others Similarly

Situated, et al.,

DECISION AND ORDER

Plaintiffs,

1:19-CV-00385 EAW1

v.

OLIN CORPORATION, et al.,

Defendants.

_____________________________________

THE TRIPP PLATING WORKS, INC., On

Behalf of Itself and All Others Similarly

Situated, et al.,

Plaintiffs,

1:19-CV-00975 EAW

v.

OLIN CORPORATION, et al.,

Defendants.

_____________________________________

1 Unless otherwise noted, all docket references herein refer to Civil Action No. 19-

cv-00385 (the “Lead Action”).

INTRODUCTION

Plaintiffs The Tripp Plating Works, Inc. (“Tripp”) and Finch Paper, LLC

(collectively the “Indirect Purchaser Plaintiffs”)2 bring these putative class actions against

defendants Olin Corporation, K.A. Steel Chemicals, Inc., Occidental Chemical

Corporation, Westlake Chemical Corporation, Shintech Incorporated, and Formosa

Plastics Corporation, U.S.A. (collectively, “Defendants”), alleging an anticompetitive

conspiracy by Defendants to fix the price of caustic soda in the United States. (Dkt. 335).

On June 24, 2021, the Court entered a Decision and Order granting in part and

denying in part Defendants’ motion to dismiss the Indirect Purchaser Plaintiffs’

consolidated class action complaint. (Dkt. 309) (the “June 2021 D&O”). The Court

subsequently modified the June 2021 D&O solely to permit the Indirect Purchaser

Plaintiffs leave to file an amended complaint. (Dkt. 319). The Indirect Purchaser Plaintiffs

filed their amended consolidated class action complaint (the “amended indirect purchaser

complaint”) on August 23, 2021. (Dkt. 335). Among other things, the amended indirect

purchaser complaint asserts claims for unjust enrichment under the laws of Arizona,

Florida, Hawaii, Illinois, Iowa, Maine, Michigan, Minnesota, Mississippi, Nebraska,

Nevada, New Mexico, New York, North Dakota, Oregon, Rhode Island, South Dakota,

Utah, Vermont, West Virginia, and Wisconsin. (Id. at ¶¶ 157-264). The amended indirect

2 Precious Plate, Inc. was formerly an indirect purchaser plaintiff, but voluntarily

dismissed its individual claims and withdrew as a named plaintiff on October 1, 2021.

(Dkt. 343).

purchaser complaint also asserts a claim under the antitrust law of Connecticut, among

other states. (Id. at ¶¶ 141-47).

Presently before the Court is a motion filed by Defendants seeking dismissal of the

Indirect Purchaser Plaintiffs’ unjust enrichment claims under the laws of all states except

Hawaii, and seeking to limit the Indirect Purchaser Plaintiffs’ damages under the

Connecticut antitrust statute to conduct occurring after October 2018. (Dkt. 346). For the

reasons that follow, Defendants’ motion is granted in part and denied in part.

BACKGROUND

I. Factual Background

As noted above, the instant actions relate to a purported anticompetitive conspiracy

by Defendants to fix the price of caustic soda in the United States. The details of the alleged

conspiracy are set forth at length in this Court’s Decision and Order dated March 27, 2020,

resolving several prior motions to dismiss (Dkt. 119), familiarity with which is assumed

for purposes of this Decision and Order. The Indirect Purchaser Plaintiffs are New York

corporations that “indirectly purchased Caustic Soda manufactured by one or more of the

Defendants” during the relevant time period. (Dkt. 335 at ¶¶ 18-20).

II. Procedural Background

The procedural background of this matter is set forth in detail in the June 2021 D&O,

familiarity with which is assumed for purposes of this Decision and Order. The Indirect

Purchaser Plaintiffs filed the indirect purchaser amended complaint on August 23, 2021.

(Dkt. 335). Defendants filed the instant motion to dismiss on October 22, 2021. (Dkt.

345). The Indirect Purchaser Plaintiffs filed their opposition on November 15, 2021. (Dkt.

356). Defendants filed their reply on November 22, 2021. (Dkt. 370).

DISCUSSION

I. Legal Standard

“In considering a motion to dismiss for failure to state a claim pursuant to Rule

12(b)(6), a district court may consider the facts alleged in the complaint, documents

attached to the complaint as exhibits, and documents incorporated by reference in the

complaint.” DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 111 (2d Cir. 2010). A court

should consider the motion by “accepting all factual allegations as true and drawing all

reasonable inferences in favor of the plaintiff.” Trs. of Upstate N.Y. Eng’rs Pension Fund

v. Ivy Asset Mgmt., 843 F.3d 561, 566 (2d Cir. 2016). To withstand dismissal, a claimant

must set forth “enough facts to state a claim to relief that is plausible on its face.” Bell Atl.

Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the reasonable inference that

the defendant is liable for the misconduct alleged.” Turkmen v. Ashcroft, 589 F.3d 542,

546 (2d Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).

“While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need

detailed factual allegations, a plaintiff’s obligation to provide the grounds of his

entitle[ment] to relief requires more than labels and conclusions, and a formulaic recitation

of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (internal

quotations and citations omitted). “To state a plausible claim, the complaint’s ‘[f]actual

allegations must be enough to raise a right to relief above the speculative level.’” Nielsen

v. AECOM Tech. Corp., 762 F.3d 214, 218 (2d Cir. 2014) (quoting Twombly, 550 U.S. at

555).

Here, Defendants make the following arguments in support of their motion to

dismiss: (1) the Indirect Purchaser Plaintiffs’ unjust enrichment claims under the laws of

Florida, Maine, Michigan, and North Dakota fail because the Indirect Purchaser Plaintiffs

are not alleged to have conferred a direct benefit on Defendants; (2) the relationship

between the parties is too attenuated to support an unjust enrichment claim under the law

of New York; (3) the Indirect Purchaser Plaintiffs’ unjust enrichment claims are

impermissibly duplicative of their statutory claims under the laws of Arizona, Florida,

Illinois, Iowa, Maine, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Mexico,

New York, North Dakota, Oregon, Rhode Island, South Dakota, Vermont, West Virginia,

and Wisconsin; (4) the Indirect Purchaser Plaintiffs have not pled an inadequate remedy at

law as required under the laws of Iowa, Minnesota, Nevada, South Dakota, Utah, and West

Virginia; and (5) the Indirect Purchaser Plaintiffs’ antitrust claim under Connecticut law

must be limited to post-October 2018 conduct. (Dkt. 346 at 6-7). The Court considers

these arguments below.

II. Direct Benefit

The Indirect Purchaser Plaintiffs argue that they “conferred a benefit on Defendants

that is directly traceable to Defendants’ anticompetitive conduct”—specifically, that their

“demand-side purchases conferred a benefit upon Defendants by enabling them to profit

from their anticompetitive price increases.” (Dkt. 356 at 10). They further contend that

Defendants are incorrect regarding the requirements of the laws of Florida, Maine,

Michigan, and North Dakota as to the conferring of a direct benefit. (Id. at 12-15).

The Indirect Purchaser Plaintiffs’ arguments that Florida and North Dakota do not

require the conferring of a direct benefit to sustain an unjust enrichment claim are not

persuasive. As to Florida, the Supreme Court of Florida has unequivocally stated that “to

prevail on an unjust enrichment claim, the plaintiff must directly confer a benefit to the

defendant.” Kopel v. Kopel, 229 So. 3d 812, 818 (Fla. 2017). While Kopel was not decided

in the antitrust context, it is an authoritative statement of Florida’s highest court on the

requirements of Florida’s common law. Further, the Court agrees with the other federal

courts that have concluded that an indirect purchaser has not conveyed a direct benefit on

a defendant as required by Florida law. See, e.g., Sandee’s Catering v. Agri Stats, Inc., No.

20 C 2295, 2021 WL 963812, at *4 (N.D. Ill. Mar. 15, 2021).

Turning to North Dakota, the Supreme Court of North Dakota has long held that a

plaintiff claiming unjust enrichment must show that the defendant “obtained a benefit at

the direct expense of the [plaintiff].” Midland Diesel Service v. MDU Resources Group,

Inc., 307 N.W. 2d 555, 557 (N.D. 1981). While the Indirect Purchaser Plaintiffs attempt

to argue that this is somehow different from a direct benefit requirement (see Dkt. 356 at

15), they fail to offer any meaningful distinction or to cite any cases finding the same. The

Court agrees with Defendants that the Indirect Purchaser Plaintiffs lack a viable unjust

enrichment claim under the law of North Dakota. See Sandee’s Catering, 2021 WL

963812, at *5 (“The bulk of the authority supports Defendants’ position that indirect

purchaser allegations are insufficient to establish a ‘direct benefit’ under North Dakota

law.”).

However, the Court agrees with the Indirect Purchaser Plaintiffs as to the laws of

Michigan and Maine. With respect to Michigan, federal courts have reached different

conclusions regarding the requirement that a direct benefit be conferred. Some courts have

relied on “an unpublished decision of the Michigan Court of Appeals—Michigan’s

intermediate appellate court”—to determine that a direct benefit is required. In re Keurig

Green Mountain Single-Serve Coffee Antitrust Litig., 383 F. Supp. 3d 187, 271 (S.D.N.Y.

2019) (citing A & M Supply Co. v. Microsoft Corp., No. 274164, 2008 WL 540883, at *2

(Mich. Ct. App. Feb. 28, 2008)). Others have pointed out that “the Michigan Supreme

Court has explicitly allowed at least one unjust enrichment claim based on conferral of an

indirect benefit.” Sandee’s Catering, 2021 WL 963812, at *4 (citing Kammer Asphalt

Paving Co. v. E. China Twp. Sch., 443 Mich. 176, 504 N.W.2d 635, 641 (1993)); see also

In re Packaged Seafood Prod. Antitrust Litig., 242 F. Supp. 3d 1033, 1091 (S.D. Cal. 2017)

(same). The Court agrees with those courts that have concluded that the relevant case law

shows that “on balance, Michigan at least does not always require conferral of a direct

benefit in order to validly plead a claim of unjust enrichment[.]” In re Packaged Seafood,

242 F. Supp.3d at 1091. In particular, the Michigan Supreme Court’s decision in Kammer

Asphalt, where it allowed an unjust enrichment claim to proceed notwithstanding that

“plaintiff indirectly provided defendant a benefit,” 443 Mich. at 187, appears to foreclose

the imposition of a blanket direct benefit requirement.

As to Maine, the Court finds persuasive the discussion in In re Hard Disk Drive

Suspension Assemblies Antitrust Litig., No. 19-MD-02918-MMC, 2021 WL 4306018

(N.D. Cal. Sept. 22, 2021). As the In re Hard Disk court explained:

In Platz Associates v. Finley, 973 A.2d 743 (Me. 2009), the Supreme Judicial

Court of Maine held that, to establish an unjust enrichment claim, the

plaintiff must show he “conferred a benefit” on the defendant. See id. at 750

(internal quotation and citation omitted). The Supreme Judicial Court,

however, did not hold in Platz Associates, nor has any party brought to the

Court’s attention any opinion in which a Maine court has held, the requisite

benefit must be directly conferred on the defendant or that the plaintiff be in

privity with the defendant. Moreover, the Supreme Judicial Court appears to

be of the view that the requisite benefit can be conferred indirectly, given its

finding that the plaintiff therein had failed to establish the defendant received

a benefit either from that plaintiff or from “anyone else.” See id. at 751.

Id. at *26; see also Sandee’s Catering, 2021 WL 963812, at *4 (acknowledging that a

“few” cases have held that Maine law requires a direct benefit, but concluding that

authority to the contrary is “more compelling”). The Court accordingly will not dismiss

the Michigan and Maine unjust enrichment claims for failure to allege a direct benefit.

III. New York Claim

Defendants also seek dismissal of the Indirect Purchaser Plaintiffs’ New York unjust

enrichment claim, arguing that the relationship between the parties is too attenuated to

support this cause of action. (Dkt. 356 at 12-13). The Court does not find this claim

amenable to resolution on the pleadings. The Second Circuit has explained that, under the

law of New York, “the requirement of a connection between plaintiff and defendant is a

modest one: [an unjust enrichment] claim will not be supported if the connection between

the parties is too attenuated.” Myun-Uk Choi v. Tower Rsch. Cap. LLC, 890 F.3d 60, 69

(2d Cir. 2018) (quotation omitted). There need not be a direct relationship between the

parties. Id.

As another court in this Circuit has explained, this means that under New York law,

while “a product’s indirect purchaser cannot assert an unjust enrichment claim against an

entity that manufactured one of that product’s ingredients . . .[,] the indirect purchaser can

assert such an unjust enrichment claim against the manufacturer of the product itself.”

Waldman v. New Chapter, Inc., 714 F. Supp. 2d 398, 403 (E.D.N.Y. 2010) (emphasis in

original and collecting cases). That is the case here—the Indirect Purchaser Plaintiffs seek

to assert an unjust enrichment claim against Defendants, who are the manufacturers of the

caustic soda at the center of this litigation. Accordingly, this is no basis for the Court to

dismiss the New York unjust enrichment claim. See id.

IV. Duplication of Statutory Claims

The Court turns next to Defendants’ argument that the “unjust enrichment claims

should be dismissed as duplicative where statutory claims remain.” (Dkt. 346 at 14). The

Court is unpersuaded. Defendants are correct that “[u]njust enrichment claims can be

either ‘autonomous’—claims independent of a predicate statutory claim—or ‘parasitic’—

claims that merely provide an alternative remedy for the underlying predicate statutory

claim.” (Id.); see In re Digital Music Antitrust Litig., 812 F. Supp. 2d 390, 411 (S.D.N.Y.

2011). Here, the claims at issue are correctly categorized as parasitic of the state law

statutory claims. See In re Digital Music, 812 F. Supp. at 411.

“[T]he question of whether an unjust-enrichment claim is duplicative is a state-law

issue,” and it accordingly requires a “case-by-case examination of whether each state’s

antitrust or consumer protection statute has overriden or limited the scope of restitutionary

relief that would normally be available to a plaintiff at equity.” In re Namenda Indirect

Purchaser Antitrust Litig., No. 1:15-CV-6549CMRWL, 2021 WL 2403727, at *38

(S.D.N.Y. June 11, 2021) (quotation and alterations omitted). However, Defendants have

provided the Court with no briefing on the individual laws of the 19 states at issue. Instead,

they make a conclusory assertion that the unjust enrichment claims “will rise or fall with

their corresponding statutory claims.” (Dkt. 346 at 15).

Where, as here, a defendant does not “brief[] the extent to which each of [the

relevant] states’ antitrust and consumer protection laws limits a plaintiff’s ability to recover

in equity,” it is not the Court’s responsibility to “undertake an independent assessment of

whether and to what extent these each of these statutes restricts equitable recovery.”

Sergeants Benevolent Ass’n Health & Welfare Fund v. Actavis, PLC, No. 15 CIV. 6549

(CM), 2018 WL 7197233, at *57 (S.D.N.Y. Dec. 26, 2018). Instead, the Court will deny

Defendants’ motion to dismiss the parasitic unjust enrichment claims “without prejudice

to consideration of the issue at a later date on proper briefing.” Id.

V. Existence of Adequate Remedy at Law

Next, Defendants contend that the Indirect Purchaser Plaintiffs’ unjust enrichment

claims under the laws of Iowa, Minnesota, Nevada, South Dakota, Utah, and West Virginia

must be dismissed because the Indirect Purchaser Plaintiffs have an adequate remedy at

law. (Dkt. 346 at 16). Again, the Court disagrees.

As the Indirect Purchaser Plaintiffs correctly point out, the absence of an adequate

remedy at law is not an element of an unjust enrichment claim in the relevant jurisdictions.

See In re Processed Egg Prod. Antitrust Litig., 851 F. Supp. 2d 867, 915 (E.D. Pa. 2012)

(finding that “the absence of an adequate remedy at law is not an element of the prima facie

case for unjust enrichment under the laws of” Minnesota, Nevada, South Dakota, and Utah,

and that accordingly “Plaintiffs are not required to plead factual allegations suggesting such

an absence as to those states’ unjust enrichment claims” (emphasis in original)); CSS, Inc.

v. Herrington, 306 F. Supp. 3d 857, 882 (S.D.W. Va. 2018) (“Under West Virginia law,

the elements of an unjust enrichment claim are: (1) a benefit conferred upon the defendant,

(2) an appreciation or knowledge by the defendant of such benefit, and (3) the acceptance

or retention by the defendant of the benefit under such circumstances as to make it

inequitable for the defendant to retain the benefit without payment of its value.” (quotation

and alteration omitted)); Maint. Enterprises, LLC v. Orascom E&C USA, Inc., No. 3:16-

CV-00014 SMR CFB, 2017 WL 6997892, at *2 (S.D. Iowa Nov. 13, 2017) (“[I]n 2001,

the Iowa Supreme Court clearly said that the requirement that a plaintiff show he or she

has no adequate remedy at law is not a formal element for an unjust enrichment claim.”

(citing State, Dep’t of Human Servs. ex rel. Palmer v. Unisys Corp., 637 N.W.2d 142, 154-

55 n.2 (Iowa 2001)). Accordingly, at the pleadings stage, the Indirect Purchaser Plaintiffs

were not required to make factually supported allegations showing a lack of an adequate

remedy at law in order to pursue these claims. See, e.g., In re Processed Egg Prod., 851

F. Supp.2d at 917.

VI. Pre-2018 Damages Under Connecticut Antitrust Law

Defendants’ final argument is that the Indirect Purchaser Plaintiffs cannot recover

for any damages prior to 2018 under the antitrust statute law of Connecticut, because

Connecticut first adopted an Illinois Brick3 repealer statute in October 2018 and that statute

does not apply retroactively. The Indirect Purchaser Plaintiffs state in a footnote in their

response papers that they “do not contest that their Connecticut antitrust claim should be

limited to post-2018 conduct.” (Dkt. 356 at 8 n.2). Accordingly, the Court will grant this

portion of Defendants’ motion.

CONCLUSION

For the reasons set forth above, the Court grants in part and denies in part

Defendants’ motion (Dkt. 345) for partial dismissal of the amended indirect purchaser

complaint (Dkt. 335). Specifically, the Court grants Defendants’ motion with respect to

the unjust enrichment claims asserted under the laws of Florida and North Dakota, and with

respect to any pre-October 2018 claim for damages under Connecticut’s antitrust statute,

and denies Defendants’ motion in all other respects.

SO ORDERED.

________________________________

ELIZABETH A. WOLFORD

Chief Judge

United States District Court

Dated: August 26, 2022

Rochester, New York

3 Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977). A detailed discussion of Illinois

Brick and its impact on indirect purchaser antitrust actions can be found in the June 2021

D&O. (See Dkt. 309 at 10-13).