If you purchased invisible or transparent tape – you could be a winner! Or so you might have thought, reading the ad near the back of the latest issue of Sports Illustrated.
Labeled a “legal notice,” the half-page display discussed a class-action lawsuit over Scotch tape. Seriously.
It could affect anyone who bought 3M tape between Jan. 1, 1993, and Aug. 5, 2005.
There’s a proposed settlement on the table, already given preliminary approval by a federal judge in California. And the notice is designed to let people know about their rights to stay in the class of litigants who are settling or to opt out and preserve a right to sue separately.
So you read on, wondering what you, as an individual user of tape, might reap by settling. A windfall? A teensy cash payment? Some coupons?
Nothing. Zippo. Not even the cost of wrapping a load of presents or super-sealing an envelope.
Under the settlement, if it’s approved, 3M would donate $41 million worth of tape and other products to designated U.S. charities. Each of 15 named plaintiffs would receive $1,000 for their troubles in suing.
And 28 plaintiffs’ law firms would divvy up a maximum of $7.5 million in attorney fees. This looked for all the world like a spoof by those who rail against class-action suits as a bane on free markets and the legal system.
But it turns out that at www.invisibletapesettlement.com you can read legal documents in the case, including the complaint that explains how Kathleen Conroy of California was forced to pay “supra-competitive prices” for 3M tape at her local Rite Aid drugstores and was “denied a competitive choice” of lower-cost products because of the Scotch tape giant’s monopolistic menacing.
Her fellow plaintiffs include other California residents, individuals from Virginia, Florida, Kansas, New Mexico and Wisconsin, a San Francisco restaurant and a Tennessee piercing and tattoo shop.
All economically injured, like you and me, we’re led to believe, by a corporate behemoth’s bigfooting.
Now before you stick up for 3M, viewing this class action as an overblown reaction to inflated pricing, let’s dig a bit deeper.
Turns out, according to court papers and some news research on Nexis.com, that this suit builds on antitrust litigation that 3M has been fighting since the late 1990s.
LePage’s, an office products company, sued 3M over its rebate arrangements with retailers such as Staples and Kmart. LePage’s made tape that stores would sell under their own brand but for less than 3M products. The rebate program, which linked discounts to sales of a range of 3M products, helped the company maintain its 90 percent-plus share of the transparent tape market. But it also muscled out rivals. Whether this was an intentional foul or the natural flow of tough competition depends on your perspective.
A Pennsylvania jury branded 3M a corporate predator that should pay LePage’s $22.8 million for its losses. Antitrust law tripled that to almost $68.5 million.
When 3M appealed to the 3rd U.S. Circuit Court of Appeals, Judge Morton Greenberg wrote an opinion for a panel that voted 2-1 to throw out the verdict. Judge Samuel Alito voted with Greenberg. Alito was among the dissenters when the full court reinstated the jury award by a 7-3 vote.
Oh, it’s dandy that a handful of charities – the American Red Cross, Salvation Army, Habitat for Humanity, the SHOPA Kids in Need Foundation, Gifts in Kind International and the National Association for the Exchange of Industrial Resources are those listed in court documents – will reap 3M largess in the form of tape, sticky notes, markers, bulletin boards, projectors, first-aid products, cleaning tools and more.
But I’ll be wondering, with more than a little exasperation, how those lawyers enjoyed their $7.5 million – especially next time I’m repairing a torn dollar bill with Scotch tape.
c 2006, Fort Worth Star-Telegram. Distributed by Knight Ridder/Tribune Information Services.