U.S. Supreme Court

Citing changed 'risk assessment' after Scalia's death, Dow settles class action for $835M

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Dow Chemical has decided to settle a class-action suit alleging price fixing in polyurethane sales rather than risk Supreme Court action that could let stand or affirm a $1.06 billion judgment.

Dow agreed to settle for $835 million, report the National Law Journal (sub. req.), the Wall Street Journal (sub. req.) and the Wall Street Journal Law Blog. How Appealing links to additional coverage here and here.

Dow said its “risk assessment” had changed after the death of Justice Antonin Scalia. The company now sees an “increased likelihood for unfavorable outcomes for business involved in class action suits.” According to the Wall Street Journal, the court is now more likely to rule 4-4 in cases raising class-action issues.

Dow’s pending cert petition (PDF) was on hold as the Supreme Court considered a separate class-action case, Tyson Foods Inc. v. Bouaphakeo, involving statistics that presume all class members are identical to the average. Dow also raised concerns about statistical formulas in class actions.

According to the National Law Journal, Scalia “was a powerful voice against class actions on the Supreme Court.” Dow’s cert petition cited two class action decisions by Scalia.

Dow Chemical’s lawyer before the Supreme Court, Carter Phillips, told the Wall Street Journal that he had several other cases that could be affected by the changed Supreme Court.

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