Davidson et al v. Bain Capital Partners, LLC et al
Filing
616
Senior Judge Edward F. Harrington: ORDER entered. MEMORANDUM AND ORDER, ALLOWING IN PART AND DENYING IN PART 595 MOTION to Dismiss Settled and Released Claims and Time-Barred Claims from the Fifth Amended Complaint filed by The Blacks tone Group L.P., Thomas H. Lee Partners, L.P., Apollo Global Management, LLC, Kohlberg Kravis Roberts & Company, L.P., TC Group IV, L.P., JP Morgan Chase & Co., Texas Pacific Group, Bain Capital Partners, LLC, Silver Lake Partners, TC Group III, L.P., Goldman Sachs Group, Inc., Providence Equity Partners, Inc..(Folan, Karen)
<![CDATA[
UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
**************************
KIRK DAHL, ET AL., Individually and
on Behalf of All Others Similarly Situated,
Plaintiffs
v.
CIVIL ACTION NO.:
07-12388-EFH
BAIN CAPITAL PARTNERS, LLC, ET AL.,
Defendants.
**************************
MEMORANDUM AND ORDER
July 18, 2012
HARRINGTON, S.D.J.
This matter comes before the Court on the Defendants’ Motion to Dismiss Settled and
Released Claims and Time-Barred Claims from the Fifth Amended Complaint. The Court allowsin-part and denies-in-part the Defendants’ motion.
Releases. After a review of the memoranda of the parties and releases submitted in
connection with this motion, the Court orders certain Defendants to be released from all claims
arising from or related to certain specified transactions alleged in the Fifth Amended Complaint,
as follows:
As to the Alltel transaction, the released Defendants are Goldman Sachs, JPMorgan, and
TPG.
As to the Biomet transaction, the released Defendants are Blackstone, Goldman Sachs,
JPMorgan, KKR, and TPG.
As to the Harrah’s transaction, the released Defendants are Apollo, Blackstone, Goldman
Sachs, JPMorgan, and TPG.
As to the Sabre transaction, the released Defendants are Silver Lake, TPG and Goldman
Sachs.
As to the TXU transaction, the released Defendants are Goldman Sachs, JPMorgan, KKR
and TPG.
Notwithstanding these releases, these five (5) transactions remain at issue in this case as
evidence of the overarching conspiracy as they relate to the non-released Defendants. The
Defendants’ motion, with respect to the issue of the releases is, therefore, allowed.
Statute of Limitations. Plaintiffs’ Fifth Amended Complaint contains an altered class
definition specifying as part of an “Overarching Conspiracy Class” stockholders who sold stocks
in connection with the (1) Clear Channel, (2) Education Management, (3) Sabre, (4) Toys "R" Us,
and (5) Univision transactions. Four of the five transactions were only briefly mentioned in the
earlier-filed Fourth Amended Complaint and none were mentioned in prior complaints.
Defendants assert that the alteration of the class allegations to include these transactions
constitutes the addition of new claims which are barred by the Sherman Act’s four-year limitations
period. See 15 U.S.C. § 15b. Plaintiffs, on the other hand, contend that the inclusion of these
transactions in the class definition does not constitute the addition of new claims and that, if such
an alteration did constitute the addition of new claims, such claims relate back to the timely-filed
earlier complaints pursuant Fed. R. Civ. P. 15(c)(1)(B).
In a prior decision, this Court held that an amendment to the complaint altering the class
2
allegation and adding an additional claim with respect to the PanAmSat transaction related back
to an earlier-filed complaint under Fed. R. Civ. P. 15(c)(1)(B). Dahl v. Bain Capital Partners,
LLC, 760 F.Supp.2d 196, 199-200 (D.Mass.2011). In explaining its holding, this Court reasoned
that the PanAmSat transaction was always a transaction contained in the Plaintiffs’ alleged
overarching conspiracy to suppress competition for large leverage buyout transactions. See id. at
200 (“The PanAmSat deal was specifically identified in the SAC as one of the illegal leverage
buyouts”). This Court concluded that under Rule 15(c)(1)(B), the amendment properly "arose
out of the same conduct, transaction, or occurrence contained in the [earlier-filed complaint]." Id.
The Court applies the same principle to the present amendment. The earlier-filed
complaints set forth an overarching conspiracy to fix the price of a number of leveraged buyout
transactions greater than $2.5 billion. While the earlier-filed complaints included specific factual
allegations regarding certain transactions known to the Plaintiffs at the time of filing, those
transactions were only meant to be indicative of the alleged overarching conspiracy and not an
exhaustive list of transactions claimed to be a part of the conspiracy. See Dahl v. Bain Capital
Partners, LLC, 589 F.Supp.2d 112, 114 (D.Mass.2008) (“The Shareholders’ claim of conspiracy
is quite expansive; this suit includes all LBOs involving the PE Firms that totaled more than $2.5
billion and occurred between 2003 and 2008.”). The claim itself is worded generally and the
Court, in an effort to make discovery manageable, instituted a phased discovery process with the
intention that an amendment would be allowed if specific evidence of collusion was garnered
about additional transactions relative to the claim. See id. at 119 (“At the conclusion of the first
stage of discovery, the court shall determine whether further discovery as to additional
transactions is warranted. . . . If a second stage of discovery is warranted, the Shareholders shall
3
move to amend the complaint in order to add additional transactions and defendants.”).
While the five transactions, unlike the PanAmSat transaction, were not specifically set
forth in the earlier complaints, Defendants had notice that the claim included an undetermined
number of leveraged buyout transactions greater than $2.5 billion over a finite period of time and
that additional transactions would be identified as discovery yielded evidence of collusion. Id. at
114 n.2 (“The Shareholders represented in the November 13, 2008 motion hearing that this case
could include up to, but no more than, 36 transactions.”). The five transactions at issue are
alleged to be such transactions over $2.5 billion occurring during the alleged conspiratorial period
and were identified as part of the claim when discovery yielded specific evidence of collusion. An
amendment to add the five transaction to the class allegation does not, therefore, alter the
substance of the original claim. Even if the amendment did, however, alter the substance of the
original claim, the new claim would arise out of the conduct attempted to be set forth in the
timely-filed earlier complaints.
The amendment in this case is different from the amendment in Moniz v. Bayer A.G., 447
F.Supp.2d 31 (D.Mass.2006), which is cited by the Defendants for support. In Moniz, the
plaintiff’s earlier-filed complaint never “even hinted that any of the Defendants was accountable
for an alleged price-fixing conspiracy concerning [the product added to the complaint]” and,
therefore, added a novel claim to the existing case. Id. at 38. Here, the defendants had notice
that the allegations made in the timely-filed earlier complaints encompassed additional
transactions.
The amendment with respect to the class allegation for the above-stated five transactions,
therefore, complies with Rule 15(c)(1)(B) and relates back to the earlier-filed complaints. The
4
Defendants’ motion, with respect to the issue of statute of limitations is, therefore, denied.
Defendants’ Motion to Dismiss Settled and Released Claims and Time-Barred Claims
from the Fifth Amended Complaint (Docket No. 595) is, hereby, ALLOWED-IN-PART and
DENIED-IN-PART.
SO ORDERED.
/s/ Edward F. Harrington
EDWARD F. HARRINGTON
United States Senior District Judge
5
]]>
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?
