News America Marketing agreed last week to pay approximately
$280 million to settle claims brought by advertising customers for alleged
antitrust overcharges.
The settlement was announced on the first day of trial, at
which Dial Corporation, Heinz, and a class of over 550 other consumer goods
manufacturers sought to recover $674 million in antitrust overcharges, which
would have been automatically trebled to over $2 billion under the antitrust
laws.
On February 23, News America entered into settlement
agreements with a few class members – Johnson & Johnson, General Mills,
Dannon, and Reckit Benckiser. A
class-wide settlement on behalf of the remaining class members was announced on
February 29 for $244 million, along with injunctive relief that would limit the
duration of News America’s exclusive contracts with retailers. The total payments by News America were
reported at $280 million.
The lawsuit accused News America of engaging in exclusive
dealing and monopolizing the market for in-store advertising and free-standing
inserts (“FSIs”) in violation of Section 1 and 2 of the Sherman Antitrust Act.
Several competitors previously sued News America for some of
the same misconduct, and entered into sizeable settlement agreements with News
America: $125 million for Insignia Systems, $500 million for Valassis, and
$29.5 million for Floorgraphics.
