Page 1 IN THE UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
«11585 GAC
CIVIL ACTION NO.:
Custom Printing of Willmar, Inc.,
on behalf of itself and all others
similarly situated,
Plaintiff,
CLASS ACTION COMPLAINT
VS.
Nee Nee Nee eet ee ee Nee Ne
International Paper Co; MeadWestvaco Corp.;
RECEIPT # =e
Norske Skogindustrier ASA; Norske Skd¥A ISTRATE woe COhoy\ AC MONS ISSUED
North America LLC; Norske Skog (USA), Inc.;
. AL RULE 4.1_|
Norke Skog (USA) Holdings, Inc.; Norske Skog WAVER FORM
Canada Limited; Norske Skog Canada (USA), MCF ISSUE
BY DPTY.GLK, 1V™
DATE —
Inc.; Stora Enso Oyj; Stora Enso North America
Corporation; Sappi Limited; S.D. Warren
Company; Metsélitto Group; Metsilitto
Cooperative; M-real Corporation; M-real USA
Corp.; UPM-Kymmene Corporation; Myllykoski
Corporation; Madison International Sales
Company; and Bowater, Inc.
Defendants.
Nm” “Se” Smee” mee me Ne” See ee ee! Se See Nee Nee!
Plaintiff, Custom Printing of Willmar, Inc., on behalf of itself and a class of all others
similarly situated, brings this federal antitrust action for treble damages against Defendants,
International Paper Co; MeadWestvaco Corp.; Norske Skogindustrier ASA; Norske Skog North
America LLC; Norske Skog (USA), Inc.; Norke Skog (USA) Holdings, Inc.; Norske Skog
Canada Limited; Norske Skog Canada (USA), Inc.; Stora Enso Oyj; Stora Enso North America
Corporation; Sappi Limited; $.D. Warren Company; Metsdlitto Group; Metsalitto Cooperative;
M-real Corporation, M-real USA Corp.; UPM-Kymmene Corporation; Myllykoski Corporation;
Madison International Sales Company; and Bowater, Inc. (collectively, “Defendants”). Page 2 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 2of 21
NATURE OF THE CASE
. Plaintiff brings this lawsuit as a class action on behalf of all individuals and
entities that purchased Publication Paper in the United States from Defendants, their
predecessors, subsidiaries or co-conspirators from at least January 1, 1990 through the present
(the “Class Period”). Plaintiff alleges that during the Class Period, Defendants conspired to fix,
raise, maintain or stabilize prices for Publication Paper sold in the United States. Because of
Defendants’ unlawful conduct, Plaintiff and the other class members paid more for Publication
Paper than they would have in the absence of Defendants’ alleged conduct.
JURISDICTION AND VENUE
. Plaintiff brings this action pursuant to Sections 4 and 16 of the Clayton Act (15
U.S.C. $§15 and 26) to recover treble damages and costs of suit, including reasonable attorneys’
fees, as the result of Defendants’ violation of Section 1 of the Sherman Act.
. In addition, this action is instituted to secure injunctive relief against Defendants
to prevent them from further violating Section 1 of the Sherman Act as alleged in this Complaint.
, Subject matter jurisdiction is proper pursuant to 28 U.S.C. §1331 and §1337 and
Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§15, 26.
. Venue is proper in this district pursuant to Sections 4, 12 and 16 of the Clayton
Act, 15 U.S.C. §§ 15, 22 and 26, and 28 U.S.C. §1391(b) and (c) and (d).
. Each Defendant transacts business in this district and the cause of action arose, in
part, within this district. The interstate trade and commerce described herein is and has been
carried out, in part, within this district. The unlawful acts done in violation of the Sherman Act
occurred within this district.
2Page 3 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 3of 21
PARTIES
. Plaintiff purchased Publication Paper directly from one or more of the
Defendants, or Defendants’ subsidiaries or affiliates during the Class Period.
. Defendant International Paper Co. (“IP”) is a publicly traded corporation
organized and existing under the laws of the State of New York with its principal place of
business in Stamford, Connecticut. IP’s website states, “Sales of almost $25 billion annually are
derived from businesses located primarily in the United States, Europe, Latin America,
Asia/Pacific and Canada.” IP’s 2003 annual report states, “Uncoated papers sales were $4.8
billion in 2003... but down from $4.9 billion in 2001. Coated Papers sales were $1.4 billion in, compared with $1.5 billion in 2002 and $1.6 billion in 2001.” IP distributes Publication
Paper through its distribution division, Xpedx. During the Class Period, IP was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
, Defendant MeadWestvaco Corporation (“Mead Westvaco”) is a corporation
organized and existing under the laws of the State of Delaware with its principal place of
business in Stamford, Connecticut. According to its website, “MeadWestvaco is a leading giobal
producer of packaging, coated and specialty papers, consumer and office products and specialty
chemicals.” MeadWestvaco’s paper sales were $2,127,000 out of $7,543,000 total sales,
according to its website. During the Class Period, MeadWestvaco was engaged in the business
of producing and selling Publication Paper within the United States, including this district.
. Defendant Norske Skogindustrier ASA (“Norske Skog”) is a company organized
under the laws of Norway with its principal place of business in Lysaker, Norway. According to
its website, “Norske Skog is the world’s second largest producer of publication paper... . [The
3Page 4 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 4of 21
company] has a 13% share of the global market for newsprint and magazine paper.” During the
Class Period, Norske Skog was engaged in the business of producing and selling Publication
Paper within the United States, including this district.
. Defendant Norske Skog North America LLC (“Norske Skog North America”) is a
limited liability company organized and existing under the laws of the State of Delaware with its
principal place of business in Seattle, Washington. According to its website, Norske Skog North
America was “formed on January 1, 2002, and [is] jointly owned by Defendants Norske Canada
and Norske Skog, [and] markets specialty paper products previously sold by four companies:
Norske Skog, Norske Skog Canada, Pacifica Papers, and Haindl.” During the Class Period,
Norske Skog North America, on its own and/or through Norske Sko g, Was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
. Defendant Norske Skog (USA), Inc. (“Norske USA”) is a corporation organized
and existing under the laws of the State of Delaware with its principal place of business in
Southport, Connecticut. During the Class Period, Norske LSA, on its own and/or through
Norske Skog, was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
. Defendant Norske Skog (USA) Holdings, Inc. is a corporation organized and
existing under the laws of the State of Delaware with its principal place of business in Southport,
Connecticut. During the Class Period, Norske Skog (USA) Holdings, Inc., on its own and/or
through Norske Skog, was engaged in the business of producing and selling Publication Paper
within the United States, including this district.
4Page 5 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 5of 21
. Defendant Norske Skog Canada Limited (“Norske Canada”) is a Canadian public
company federally incorporated under the Canadian Business Corporation Acts with its principal
place of business in Vancouver, BC. According to its 2003 Annual Report, Defendant Norske
Skog owns approximately 30% of Norske Canada. During the Class Period, Norske Canada, on
its own and/or through Norske Skog, was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
. Defendant Norske Skog Canada (USA), Inc. is a corporation organized and
existing under the laws of the State of California with its principal place of business in Seattle,
Washington. During the Class Period, Norske Skog Canada (USA) was engaged in the business
of producing and selling Publication Paper within the United States, including this district.
. Defendant Stora Enso Oyj (“Stora Enso”) is a corporation organized and existing
under the laws of the Republic of Finland with its principal place of business in Helsinki,
Finland. According to its 2003 Annual Report, Stora Enso’s market share is 18% in North
America and 18% globally. During the Class Period, Stora Enso was engaged in the business of
producing and selling Publication Paper within the United States, including this district.
. Defendant Stora Enso North America Corporation (“Stora Enso North America”)
is a corporation organized and existing under the laws of the State of Wisconsin with its principal
place of business in Wisconsin Rapids, Wisconsin. According to its website, “Stora Enso North
America is North America’s leading producer of coated and supercalendered papers for the
printing and publishing industries.” During the Class Period, Stora Enso North America was
engaged in the business of producing and selling Publication Paper within the United States,
including this district.
5Page 6 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 6of 21
. Defendant Sappi Limited (“Sappi”) is a company organized and existing under
the laws of the Republic of South Africa with its principal place of business in Braamfontein,
Johannesburg 2001, Republic of South Africa. According to its website, “Sappi Fine Paper’s
operations are managed through three regional business units, Sappi Fine Paper North America,
Sappi Fine Paper Europe and Sappi Fine Paper South Africa. Sappi Fine Paper is the leading
producer of coated fine paper in North America, Europe and Africa. We have a total paper
capacity of 4.3 million metric tons and the division represents 83% of group sales and 66% of
group operating income, contributing $190,000,000 in 2003.” In December 1994, Defendant
Sappi and a group of financial investors acquired S.D. Warren, the market leader in the United
States in coated fine paper and a major purchaser of other specialty paper products. The S.D.
Warren Company now does business as Sappi Fine Paper North America. During the Class
Period, Sappi was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
. Defendant $.D. Warren Company (“S.D. Warren”) doing business as Sappi Fine
Paper North America, is a corporation organized and existing under the laws of the State of
Pennsylvania with its principal place of business in Boston, Massachusetts. In December 1994,
Defendant Sappi and a group of financial investors acquired S.D. Warren, the market leader in
the United States in coated fine paper and a major purchaser of other specialty paper products.
The $.D. Warren Company now does business as Sappi Fine Paper North America. During the
Class Period, S.D. Warren was engaged in the business of producing and selling Publication
Paper within the United States, including this district.
. Defendant Metsalitto Group is organized and existing under the laws of the
Republic of Finland with its principal place of business in Finland. According to its website,
6Page 7 “Metsilitto is one of Europe’s biggest forestry groups” and “[t]he companies that make up
Metsdlitto Group specialize in selected wood and fibre based products and services.” Those
companies include Defendant M-real. During the Class Period, Metsilitto Group, on its own
and/or through Metsilitto Cooperative was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
. | Defendant Metsiilitto Cooperative is organized under the laws of the Republic of
Finland with its principal place of business in Finland. Metsiilitto Cooperative is a cooperative
organization for Finnish forest owners and has approximately 130,000 members. During the
Class Period, Metsalitto Cooperative, on its own and/or through Metsalitto Group, was engaged
in the business of producing and selling Publication Paper within the United States, including
this district.
. Defendant M-real Corporation (“M-real”) is organized and existing under the
laws of the Republic of Finland with its principal place of business in Finland. During the Class
Period, M-real was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
. Defendant M-real USA Corp. (“M-real USA”) is organized and existing under the
laws of the State of Wisconsin with its principal place of business in Wisconsin Rapids,
Wisconsin. During the Class Period, M-real USA was engaged in the business of producing and
selling Publication Paper within the United States, including this district.
. Defendant UPM-Kymmene Corporation (“UPM”) is organized and existing under
the laws of the Republic of Finland with its principal place of business in Helsinki, Finland.
According to its website, “UPM is one of the world’s leading forest products companies. The
company’s businesses focus on magazine papers, newsprint, fine and specialty papers,
7Page 8 converting materials and wood products.” During the Class Period, UPM was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
. Defendant Myllykoski Corporation (“Myllykoski”) is organized and existing
under the laws of the Republic of Finland with its principal place of business in Helsinki,
Finland. According to its website, “The international and independent Myllykoski Group is
directly owned by the Myllykoski Corporation and its partner companies. Myllykowki Group is
made up of MD Lang Papier, Myllykoski North America and Myllykoski Paper, The
Myllykoski Group is highly focused and ranks number three in production of [supercalendered
paper] in the world. In the production of [light-weight coated paper] the Myllykoski Group is in
the top four, The Myllykoski Group’s 2003 Net Sales in North America was 19%, Myllykoski
Corporation’s partners are M-real Corporation, the New York Times Company (US), the new
alliance partner Rhein Papier GmbH (Germany), and Sunila (Finaland), associated company of
Myliykoski Paper.” During the Class Period, Myliykoski was engaged in the business of
producing and selling Publication Paper within the United States, including this district.
. Defendant Madison International Sales Company (“Madison”) is a company
organized and existing under the laws of the State of Delaware with its principal place of
business in Norwalk, Connecticut. Madison’s website states that “Madison International is the
U.S. sales company for the Myllykoski group of paper mills.” It also states, “Myllykoski has
sales offices all around the world, all part of the vast Myllykoski Sales Network. Madison
International is part of that sales network, and is owned by the mill, the only difference being
that we use the name ‘Madison’ here in the U.S. since it’s so well known with customers. But
when you think of us, you can think of Myllykoski. Myllykoski is the world’s 3rd largest
8Page 9 Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page Qof 21
producer of groundwood-contatining uncoated and coated publication papers.” Madison Paper
Industry, one of two divisions of Madison, is 40% owned by the New York Times Company,
During the Class Period, Madison was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
. Defendant Bowater, Inc. (“Bowater”) is a corporation organized and existing
under the laws of the State of Delaware with its principal place of business in Greenville, South
Carolina. Bowater’s website states that Bowater “is a leading producer of newsprint and coated
mechanical papers.” During the Class Period, Bowater was engaged in the business of producing
and selling Publication Paper within the United States, including this district.
CO-CONSPIRATORS
. Various other persons, firms or corporations, not yet named as Defendants in this
lawsuit, participated as co-conspirators with Defendants in the offenses alleged and performed
acts and made statements in furtherance thereof.
CLASS ACTION ALLEGATIONS
. Plaintiff brings this action on behalf of itself and as a class action under the
provisions of Rule 23(a), (b)(2) and (b)(3) of the Federal Rules of Civil Procedure on behalf of
the following class:
All persons (excluding governmental entities, Defendant, their
subsidiaries and affiliates, and their co-conspirators) who
purchased Publication Paper in the United States directly from any
of the Defendants or any subsidiary or affiliate thereof, or any co-
conspirator, at any time during the class period from January 1, to the present (the “Class”’)., Plaintiff does not know the exact size of the class, since such information is in the
exclusive control of Defendants. However, based on the nature of the trade and commerce
involved, Plaintiff believes that the class numbers at least in the thousands and that the members
9Page 10 of the class are geographically dispersed throughout the United States. Therefore, joinder of all
members of the class would be impracticable.
. There are questions of law or fact common to the class, including, but not limited
to:
a. whether Defendants conspired to fix, raise, maintain or stabilize the
prices of Publication Paper sold in the United States;
b. whether the alleged contract, conspiracy or combination violated
Section 1 of the Sherman Act;
C. the duration and extent of the contract, conspiracy or combination
alleged herein;
d, whether the Defendants and their co-conspirators took affirmative
steps to conceal the contract, conspiracy or combination;
e. whether each of the Defendants was a participant in the contract,
conspiracy or combination alleged herein;
f. whether the Defendants’ conduct caused the prices of Publication
Paper to be set at an artificially high and non-competitive level;
g. whether Defendants conspired to allocate markets for Publication
Paper sold in the United States;
h, whether Defendants’ conduct caused injury to the business or
property of Plaintiff and the class members and, if so, the
appropriate class-wide measure of damages;
. whether Defendants took steps actively to conceal their conspiracy;
and
j. whether Plaintiff and the Class are entitled to declaratory and/or
injunctive relief.
These and other questions of law and fact predominate over any questions affecting only
individual members of the class.. The claims of Plaintiff are typical of the claims of the class in that Plaintiff,
through the aforementioned assignment, is a direct purchaser of Publication Paper whose
10Page 11 purchases were, in all relevant respects, typical of purchases by other class members, and the
relief sought by Plaintiff, monetary damages, is common to the class.
. Plaintiff will fairly and adequately protect the interests of the class in that Plaintiff
is a typical purchaser of Publication Paper, has no conflicts with any other members of the class
and is represented by counsel who are experienced and competent in the prosecution of complex
class action and antitrust litigation. Further, the interests of Plaintiff are coincident with, and not
antagonistic to, those of the class members.
, Class action treatment is superior to the alternatives, if any, for the fair and
efficient adjudication of the controversy described herein, because such treatment permits a large
number of injured persons to prosecute their common claims in a single forum simultaneously,
efficiently and without unnecessary duplication of evidence and effort. Class treatment also
permits the adjudication of claims by smaller class members who could not afford to individually
litigate an antitrust claim against large corporate defendants.
. Defendants have acted on grounds generally applicable to the entire Class,
thereby making final injunctive relief or corresponding declaratory relief appropriate with
respect to the Class as a whole. Prosecution of separate actions by individual members of the
Class would create the risk of inconsistent or varying adjudications with respect to individual
members of the Class that would establish incompatible standards of conduct for Defendants.
TRADE AND COMMERCE
. All of the Defendants manufacture and/or sell Publication Paper either
independently or as part of a joint venture or merger. The Publication Paper products
manufactured and/or sold by one Defendant are comparable to and interchangeable with the
Publication Paper products manufactured and/or sold by the other Defendants.
11Page 12 37, During the Class Period, Defendants sold Publication Paper in a continuous and
uninterrupted flow of interstate commerce, to customers located in countries and states other than
the countries or states in which Defendants produced Publication Paper. The business activities
of Defendants were thus within the flow of, and substantially affected, interstate trade and
commerce.
FACTS
. The term “Publication Paper” includes Magazine Paper. The term “Magazine
Paper” includes both uncoated paper and coated magazine paper. As Defendant Stora Enso
states on its website, uncoated magazine paper “is used mainly for periodicals and advertising
material, such as inserts and flyers. It is also suitable for mass circulation TV magazines and
catalogues.” As Defendant International Paper states in their 2003 Annual Report, uncoated
papers are used for “advertising and promotional materials, such as brochures, pamphlets,
greeting cards, books, annual reports and direct mail publications.” With respect to coated
magazine paper, Defendant Stora Enso states on its website that it is available “in various matte,
silk, and glossy grades [and] is used for special interest and general interest magazines. Other
end-uses include supplements, home-shopping catalogues, and magazine covers.” As Defendant
International Paper states in their 2003 Annual Report, coated papers are “used in a variety of
printing and publication end uses such as catalogs, direct mailings magazines, inserts and
commercial printing.”
The World-Wide Antitrust Agency Raids on the Defendants’ Operations.
. On Tuesday, May 25, 2004, the Reuters news agency reported the following:
A swathe of leading global forestry firms were raided by
competition enforcers on Tuesday as part of antitrust
operations on both sides of the Atlantic regarding price-
12Page 13 fixing and manipulation of markets for various paper
products.
Raids were carried out by local or European Union antitrust
authorities at Finland’s UPM-Kymmene, Stora Enso,
Metsalitto and M-real and Norway’s Norske Skog. U.S. and
Canadian authorities cooperated.
International Paper Co., the top North American forest
products company, said it had been contacted by U.S.
officials in connection with the probe.
Later on Tuesday, the U.S. Justice Department confirmed it
is investigating possible anti-competitive practices in the
market for magazine paper. A department spokeswoman
said the probe covers the sale of magazine paper in the
United States and elsewhere.
The investigation also reached South Africa, where pulp and
paper maker Sappi said its European head office had been
raided. The company, the largest producer of fine paper
used for glossy magazines, said it had agreed to cooperate
with EU officials.
On May 25, 2004, the European Commission’s spokesperson for Competition
issued a press release and stated the following:
Following press inquiries, the European Commission’s
spokesperson for Competition has confirmed that, on 25
May 2004, Commission inspectors, assisted by officials
from the national competition authorities of the Member
States concerned, launched simultaneous unannounced
inspections at the premises of some of the major European
producers of paper and forestry products.
The purpose of these inspections is to ascertain whether
there is evidence of cartel agreements and related illegal
practices concerning price-fixing, fixing of other
commercials terms, and/or allocation of customers. Several
product markets in the European paper and forestry products
sector would be affected the alleged arrangements.
The Commission’s spokesperson has also confirmed that the
inspections have been carried out in close coordination with Page 14 competition authorities in a number of EU countries, as well
as the US and Canada. The EFTA Surveillance Authority, at
the request of the Commission, participated in the
inspections at premises of undertakings in the EFTA
Member States.
Surprise inspections are a preliminary step in investigations
into suspected cartels.
, On May 25, 2004, the EFTA Surveillance Authority, an organization charged
with enforcing competition laws with respect to EFTA Member States Iceland, Liechtenstein and
Norway, issued a press release and stated the following:
Following inquires from journalists; the EFTA Surveillance
Authority confirms that on 25 May 2004, inspectors from
the EFTA Surveillance Authority, assisted by officials from
the Norwegian Competition Authority, carried out an
unannounced inspection at the premises of a producer of
publication paper in Norway. The purposes of the imspection
is to ascertain whether there is evidence of cartel agreements
and related illegal practices amongst EEA producers of
publication paper and amongst acquirers of recovered paper.
Surprise inspections are a preliminary step in investigations
into suspected cartels.. On May 27, 2004, the Reuters news agency reported that Defendant Stora Enso’s
CEO Jukka Harmala “told a forest industry seminar arranged by banking group Nordea that
‘(t]he time span (of the investigation). . . is likely not focusing on the past few years, but can go
back as far as (the) late eighties.” The Bloomberg News Agency also reported on May 28, 2004
that Stora’s CEO said that the investigation may lead back to the late 1980s. Reuters also
reported on May 27, 2004 that Defendant Myllykoski Corporation’s CEO Carl Bjornberg stated
at the same seminar that the industry had been “very much cartelized” during at least a portion of
the Class Period.
14Page 15 15 of 21
Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page
Possible price Co-operation within i) the area of publication
paper, which includes newsprint and magazine paper and ii)
the purchase of recovered paper.. On May 24, 2004, Defendant M-real issued a press release in which it Stated the
following:
European Commission investigators have today visited M-
real Corporation’s premises. The investigation is related to
, On May 25, 2004, Defendant Sappi issued a Press release in which it stated the
following:
Fine Paper’s European Head Office in Brussels as part of a
wide-spread anti trust investigation into a number of paper
manufacturers and appears to involve a wide range of
products.
. On May 25, 2004, Defendant Stora Enso issued a press release in which it Stated
the following:
European Commission competition investigators have today
visited Stora Enso’s premises in London, Stockholm, and
Dusseldorf .
Representatives of the F innish Competition Authority visited
Stora Enso Forest’s office at Imatra and regional offices at
Summa, Joensuu, Savontinna and Kuopio in Finland.
In addition, the Company’s North American division has
Teceived a subpoena for documents from the Antitrust
Division of the US Department of Justice.
Defendants’ Unlawful Contract, Conspiracy or Combination.
, Beginning at least as early as January 1, 1990, and continuing through present, the
exact dates being unknown to Plaintiff, Defendants and their co-conspirators engaged in a
16Page 16 continuing agreement, understanding, and conspiracy in restraint of trade to artificially raise, fix,
maintain or stabilize the price of Publication Paper in the United States.
. In formulating and effectuating the alleged contract, conspiracy or combination,
Defendants and their co-conspirators engaged in anti-competitive activities, the purpose and
effect of which were to artificially raise, fix, maintain or stabilize the price of Publication Paper
in the United States. These activities included the following:
a. Defendants exchanged information on prices being charged for
Publication Paper sold to customers,
b. Defendants agreed to charge prices at specified levels and otherwise to
increase and/or maintain the price of Publication Paper in the United
States and elsewhere,
c. Defendants issued price announcements and price quotations in
accordance with the agreements reached, and
d. Defendants sold Publication Paper in the United States at non-competitive
prices.. Defendants and their co-conspirators engaged in the activities described above for
the purpose of effectuating the unlawful agreements described in this Complaint.
. During and throughout the period of the conspiracy alleged in this Complaint,
Plaintiff and members of the Class purchased Publication Paper from Defendants (or their
subsidiaries or controlled affiliates) or their co-conspirators at inflated and supracompetitive
prices.
$3. In formulating and effectuating the contract, conspiracy or combination,
Defendants and their co-conspirators engaged in anticompetitive activities, the purpose and
effect of which were to artificially raise, fix, maintain and/or stabilize the price of Publication
Paper sold in the United States. These activities included the following:
17Page 17 Case 1:04-cv
: -11583-GA
O Document 1 Filed 07/15/2004 P
age 17 of 21
ons, including
and/or conversati
to discuss the p
ations and conventions,
ed States;
Defendants particip ated in meetings
ghrough various trade organiz rice
of Publication Paper in the Unit
ants agreed during those meetings and conversations to charge
ed levels and otherwise {o increase and/or maintain prices
b. Defend
d in the United States,
rices at specifi
of Publication Paper so
etings and conversati
Defendants agreed during those me
price of Publication Paper; an
ce announcements and price quotations in
Defendants issued pri
accordance with the agreements reached.
unreasonable
ation constitutes an
conspiracy OF combin
ons 1 and 3 of the
Defendants’ contract,
gn trade and commer
.
ein violation of Secti
restraint of interstate and forei
Sherman Act.
ants’ unlawful conduct, Plaintiff and the other members of
As a result of Defend
operty in that they have
.
paid more for
their business and pr
the Class have been injured in
na competitive market.
Publication Papet than they would have paid i
¢, conspiracy and/or combination has had the following
. The unlawful contrac
effects, among others:
arket has been artificially
a. price competition in the Publication Paper m
restrained;
b. rices for Publication Paper sold by the Defendants have been raised,
fixed, maintained, OF stabilized at artificially high and non-competitive
levels;
ublication Paper from the Defendants have been deprived
etition in the markets for Publication
purchasers of P
of the benefit 0
Paper.
f free and open comp
mate result of the illegal contract, conspiracy oF combination,
. Asa direct and proxi
Plaintiff and the members of the Class have been injured and financially damaged 10 their
they paid more for Publication Paper than they would
respective pusinesses and property, in that Page 18 have paid in the absence of the illegal contract, conspiracy or combination. Plaintiff and
members of the Class thus have suffered damages in an amount presently undetermined.
Defendants and their co-conspirators are jointly and severally liable for all damages cause by
their conspiracy.
FRAUDULENT CONCEALMENT
. Until recently, neither Plaintiff nor the class members had knowledge of any of
the violations alleged herein. Further, neither Plaintiff nor the class members, until recently,
could have discovered, by the exercise of reasonable diligence, that Defendants and their co-
conspirators had engaged in the violations alleged herein since Defendants and their co-
conspirators actively and fraudulently concealed these violations so as to obscure their illegal
activity.
. Defendants engaged in a successful, iltegal price-fixing conspiracy that, by its
nature, was inherently self-concealing.
, Plaintiff and the class members could not have discovered the alleged contract,
combination and conspiracy at an earlier date by the exercise of reasonable diligence because of
the deceptive practices and techniques secrecy employed by Defendants and their co-
conspirators to avoid detection of, and to fraudulently conceal, their contract, combination and
conspiracy, Defendants fraudulently concealed the contract, combination and conspiracy herein
alleged by various means and methods, including, but not limited to, secret mectings,
misrepresentations to customers concerning the reason for price increases and surreptitious
communications between Defendants by the use of the telephone or in-person meetings at trade
associations meetings (and elsewhere) in order to prevent the existence of written records.
19Page 19 63. The affirmative actions of the Defendants herein alleged were wrongfully
concealed and carried out in a manner that precluded detection.
. Defendant also fraudulently concealed their contract, conspiracy or combination
in other ways as well. For example, Defendants falsely represented to their customers that
Publication Paper price increases were due to increases in the cost and supply of raw materials
when, in fact, these price increases were the direct result of collusive activity among Defendants
as alleged herein.
. By virtue of the fraudulent concealment by Defendants and their co-conspirators,
the running of any statute of limitations has been tolled and suspended with respect to any claims
that Plaintiff and the other class members have as a result of the unlawful contract, combination
and conspiracy alleged in this Complaint
EFFECTS/DAMAGES. Defendants’ contract, combination and conspiracy had the following effects,
among others:
a. prices charged by Defendants and their respective subsidiaries and
co-conspirators to Plaintiff and the members of the class were
maintained at artificially high and non-competitive levels;
b. buyers of Publication Paper were deprived of free and open
competition in the purchase of Publication Paper; and
C. competition in the sale of Publication Paper was unreasonably
restrained.
. During and throughout the Class Period, Plaintiff and members of the class
purchased Publication Paper from one or more of the Defendants, their respective subsidiaries,
affiliates and/or co-conspirators.
20Page 20 as >
. Asa direct and proximate result of Defendants and their ¢O-conspirators’ j
contract combination and conspiracy, Plaintiff and the members of the class were injured and
financially damaged in their businesses and Property in that they paid more for Publication Paper
than they would have in the absence of Defendants and their co-conspirators’ unlawfy] activities.
The total amount of damages is Presently undetermined.
. The contract, conspiracy or combination complained of herein wil] continue
combination is enjoined.
PRAYER FOR RELIEF
SS ENR RELIEF
. WHEREF ORE, Plaintiff prays as follows:
a. That the Court determine this action may be maintained as a class
c. That judgment be entered for Plaintiff and the members of the
class against Defendants for three-fold the amount of damages
sustained by Plaintiff and the class as allowed by law, together
with the costs of this action, including reasonable attorneys’ fees:
d. That Plaintiff and members of the Class be awarded pre-and post-
e. That Defendants, their affiliates, successors, transferees, assignees,
and the officers directors, partners, agents and employees thereof,
Permanently enjoined and restrained from in any manner: (1)
continuing, maintaining, or renewing the contract, conspiracy or
21Page 21 combination alleged herein, or from entering into any other
conspiracy alleged herein, or from entering into any other contract,
conspiracy or combination having a similar purpose or effect, and
from adopting or following any practice, plan, program, or device
having a similar purpose or effect; and (2) communicating or
causing to be communicated to any other person engaged in the
manufacture, distribution or sale of Publication Paper, information
concerning prices or other terms or conditions of sale of any such
products except to the extent necessary in connection with bona
fide sales transactions between the parties to such communications;
and
f. That Plaintiff and members of the class have such other, further
and different relief as the Court may deem just and proper under
the circumstances.
DEMAND FOR JURY TRIAL. Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands
a trial by jury of all the issues triable of right by jury.
DATED: July {Ss , 2004 BERMAN DEVALERIO PEASE TABACCO
BURT & PUCILLO
, AQ
Peter A. Pease
One Liberty Square
Boston, MA 02109
Telephone: (617) 542-8300
Facsimile: (617) 542-1194
Samuel D. Heins
Vincent J. Esades
HEINS MILLS & OLSON, P.L.C. JDS Center
South Eighth Street
Minneapolis, Minnesota 55402
Telephone: (612) 338-4605
Facsimile: (612) 338-4692
22
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Case 1:04-cv-11583-GAO Document 1 Filed 07/15/2004 Page 1 of 21
IN THE UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
04 «11585 GAC
CIVIL ACTION NO.:
Custom Printing of Willmar, Inc.,
on behalf of itself and all others
similarly situated,
Plaintiff,
CLASS ACTION COMPLAINT
VS.
Nee Nee Nee eet ee ee Nee Ne
International Paper Co; MeadWestvaco Corp.;
RECEIPT # =e
Norske Skogindustrier ASA; Norske Skd¥A ISTRATE woe COhoy\ AC MONS ISSUED
North America LLC; Norske Skog (USA), Inc.;
. AL RULE 4.1_|
Norke Skog (USA) Holdings, Inc.; Norske Skog WAVER FORM
Canada Limited; Norske Skog Canada (USA), MCF ISSUE
BY DPTY.GLK, 1V™
DATE —
Inc.; Stora Enso Oyj; Stora Enso North America
Corporation; Sappi Limited; S.D. Warren
Company; Metsélitto Group; Metsilitto
Cooperative; M-real Corporation; M-real USA
Corp.; UPM-Kymmene Corporation; Myllykoski
Corporation; Madison International Sales
Company; and Bowater, Inc.
Defendants.
Nm” “Se” Smee” mee me Ne” See ee ee! Se See Nee Nee!
Plaintiff, Custom Printing of Willmar, Inc., on behalf of itself and a class of all others
similarly situated, brings this federal antitrust action for treble damages against Defendants,
International Paper Co; MeadWestvaco Corp.; Norske Skogindustrier ASA; Norske Skog North
America LLC; Norske Skog (USA), Inc.; Norke Skog (USA) Holdings, Inc.; Norske Skog
Canada Limited; Norske Skog Canada (USA), Inc.; Stora Enso Oyj; Stora Enso North America
Corporation; Sappi Limited; $.D. Warren Company; Metsdlitto Group; Metsalitto Cooperative;
M-real Corporation, M-real USA Corp.; UPM-Kymmene Corporation; Myllykoski Corporation;
Madison International Sales Company; and Bowater, Inc. (collectively, “Defendants”).
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NATURE OF THE CASE
1. Plaintiff brings this lawsuit as a class action on behalf of all individuals and
entities that purchased Publication Paper in the United States from Defendants, their
predecessors, subsidiaries or co-conspirators from at least January 1, 1990 through the present
(the “Class Period”). Plaintiff alleges that during the Class Period, Defendants conspired to fix,
raise, maintain or stabilize prices for Publication Paper sold in the United States. Because of
Defendants’ unlawful conduct, Plaintiff and the other class members paid more for Publication
Paper than they would have in the absence of Defendants’ alleged conduct.
JURISDICTION AND VENUE
2. Plaintiff brings this action pursuant to Sections 4 and 16 of the Clayton Act (15
U.S.C. $§15 and 26) to recover treble damages and costs of suit, including reasonable attorneys’
fees, as the result of Defendants’ violation of Section 1 of the Sherman Act.
3. In addition, this action is instituted to secure injunctive relief against Defendants
to prevent them from further violating Section 1 of the Sherman Act as alleged in this Complaint.
4, Subject matter jurisdiction is proper pursuant to 28 U.S.C. §1331 and §1337 and
Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§15, 26.
5. Venue is proper in this district pursuant to Sections 4, 12 and 16 of the Clayton
Act, 15 U.S.C. §§ 15, 22 and 26, and 28 U.S.C. §1391(b) and (c) and (d).
6. Each Defendant transacts business in this district and the cause of action arose, in
part, within this district. The interstate trade and commerce described herein is and has been
carried out, in part, within this district. The unlawful acts done in violation of the Sherman Act
occurred within this district.
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PARTIES
7. Plaintiff purchased Publication Paper directly from one or more of the
Defendants, or Defendants’ subsidiaries or affiliates during the Class Period.
8. Defendant International Paper Co. (“IP”) is a publicly traded corporation
organized and existing under the laws of the State of New York with its principal place of
business in Stamford, Connecticut. IP’s website states, “Sales of almost $25 billion annually are
derived from businesses located primarily in the United States, Europe, Latin America,
Asia/Pacific and Canada.” IP’s 2003 annual report states, “Uncoated papers sales were $4.8
billion in 2003... but down from $4.9 billion in 2001. Coated Papers sales were $1.4 billion in
2003, compared with $1.5 billion in 2002 and $1.6 billion in 2001.” IP distributes Publication
Paper through its distribution division, Xpedx. During the Class Period, IP was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
9, Defendant MeadWestvaco Corporation (“Mead Westvaco”) is a corporation
organized and existing under the laws of the State of Delaware with its principal place of
business in Stamford, Connecticut. According to its website, “MeadWestvaco is a leading giobal
producer of packaging, coated and specialty papers, consumer and office products and specialty
chemicals.” MeadWestvaco’s paper sales were $2,127,000 out of $7,543,000 total sales,
according to its website. During the Class Period, MeadWestvaco was engaged in the business
of producing and selling Publication Paper within the United States, including this district.
10. Defendant Norske Skogindustrier ASA (“Norske Skog”) is a company organized
under the laws of Norway with its principal place of business in Lysaker, Norway. According to
its website, “Norske Skog is the world’s second largest producer of publication paper... . [The
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company] has a 13% share of the global market for newsprint and magazine paper.” During the
Class Period, Norske Skog was engaged in the business of producing and selling Publication
Paper within the United States, including this district.
11. Defendant Norske Skog North America LLC (“Norske Skog North America”) is a
limited liability company organized and existing under the laws of the State of Delaware with its
principal place of business in Seattle, Washington. According to its website, Norske Skog North
America was “formed on January 1, 2002, and [is] jointly owned by Defendants Norske Canada
and Norske Skog, [and] markets specialty paper products previously sold by four companies:
Norske Skog, Norske Skog Canada, Pacifica Papers, and Haindl.” During the Class Period,
Norske Skog North America, on its own and/or through Norske Sko g, Was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
12. Defendant Norske Skog (USA), Inc. (“Norske USA”) is a corporation organized
and existing under the laws of the State of Delaware with its principal place of business in
Southport, Connecticut. During the Class Period, Norske LSA, on its own and/or through
Norske Skog, was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
13. Defendant Norske Skog (USA) Holdings, Inc. is a corporation organized and
existing under the laws of the State of Delaware with its principal place of business in Southport,
Connecticut. During the Class Period, Norske Skog (USA) Holdings, Inc., on its own and/or
through Norske Skog, was engaged in the business of producing and selling Publication Paper
within the United States, including this district.
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14. Defendant Norske Skog Canada Limited (“Norske Canada”) is a Canadian public
company federally incorporated under the Canadian Business Corporation Acts with its principal
place of business in Vancouver, BC. According to its 2003 Annual Report, Defendant Norske
Skog owns approximately 30% of Norske Canada. During the Class Period, Norske Canada, on
its own and/or through Norske Skog, was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
15. Defendant Norske Skog Canada (USA), Inc. is a corporation organized and
existing under the laws of the State of California with its principal place of business in Seattle,
Washington. During the Class Period, Norske Skog Canada (USA) was engaged in the business
of producing and selling Publication Paper within the United States, including this district.
16. Defendant Stora Enso Oyj (“Stora Enso”) is a corporation organized and existing
under the laws of the Republic of Finland with its principal place of business in Helsinki,
Finland. According to its 2003 Annual Report, Stora Enso’s market share is 18% in North
America and 18% globally. During the Class Period, Stora Enso was engaged in the business of
producing and selling Publication Paper within the United States, including this district.
17. Defendant Stora Enso North America Corporation (“Stora Enso North America”)
is a corporation organized and existing under the laws of the State of Wisconsin with its principal
place of business in Wisconsin Rapids, Wisconsin. According to its website, “Stora Enso North
America is North America’s leading producer of coated and supercalendered papers for the
printing and publishing industries.” During the Class Period, Stora Enso North America was
engaged in the business of producing and selling Publication Paper within the United States,
including this district.
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18. Defendant Sappi Limited (“Sappi”) is a company organized and existing under
the laws of the Republic of South Africa with its principal place of business in Braamfontein,
Johannesburg 2001, Republic of South Africa. According to its website, “Sappi Fine Paper’s
operations are managed through three regional business units, Sappi Fine Paper North America,
Sappi Fine Paper Europe and Sappi Fine Paper South Africa. Sappi Fine Paper is the leading
producer of coated fine paper in North America, Europe and Africa. We have a total paper
capacity of 4.3 million metric tons and the division represents 83% of group sales and 66% of
group operating income, contributing $190,000,000 in 2003.” In December 1994, Defendant
Sappi and a group of financial investors acquired S.D. Warren, the market leader in the United
States in coated fine paper and a major purchaser of other specialty paper products. The S.D.
Warren Company now does business as Sappi Fine Paper North America. During the Class
Period, Sappi was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
19. Defendant $.D. Warren Company (“S.D. Warren”) doing business as Sappi Fine
Paper North America, is a corporation organized and existing under the laws of the State of
Pennsylvania with its principal place of business in Boston, Massachusetts. In December 1994,
Defendant Sappi and a group of financial investors acquired S.D. Warren, the market leader in
the United States in coated fine paper and a major purchaser of other specialty paper products.
The $.D. Warren Company now does business as Sappi Fine Paper North America. During the
Class Period, S.D. Warren was engaged in the business of producing and selling Publication
Paper within the United States, including this district.
20. Defendant Metsalitto Group is organized and existing under the laws of the
Republic of Finland with its principal place of business in Finland. According to its website,
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“Metsilitto is one of Europe’s biggest forestry groups” and “[t]he companies that make up
Metsdlitto Group specialize in selected wood and fibre based products and services.” Those
companies include Defendant M-real. During the Class Period, Metsilitto Group, on its own
and/or through Metsilitto Cooperative was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
21. | Defendant Metsiilitto Cooperative is organized under the laws of the Republic of
Finland with its principal place of business in Finland. Metsiilitto Cooperative is a cooperative
organization for Finnish forest owners and has approximately 130,000 members. During the
Class Period, Metsalitto Cooperative, on its own and/or through Metsalitto Group, was engaged
in the business of producing and selling Publication Paper within the United States, including
this district.
22. Defendant M-real Corporation (“M-real”) is organized and existing under the
laws of the Republic of Finland with its principal place of business in Finland. During the Class
Period, M-real was engaged in the business of producing and selling Publication Paper within the
United States, including this district.
23. Defendant M-real USA Corp. (“M-real USA”) is organized and existing under the
laws of the State of Wisconsin with its principal place of business in Wisconsin Rapids,
Wisconsin. During the Class Period, M-real USA was engaged in the business of producing and
selling Publication Paper within the United States, including this district.
24. Defendant UPM-Kymmene Corporation (“UPM”) is organized and existing under
the laws of the Republic of Finland with its principal place of business in Helsinki, Finland.
According to its website, “UPM is one of the world’s leading forest products companies. The
company’s businesses focus on magazine papers, newsprint, fine and specialty papers,
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converting materials and wood products.” During the Class Period, UPM was engaged in the
business of producing and selling Publication Paper within the United States, including this
district.
25. Defendant Myllykoski Corporation (“Myllykoski”) is organized and existing
under the laws of the Republic of Finland with its principal place of business in Helsinki,
Finland. According to its website, “The international and independent Myllykoski Group is
directly owned by the Myllykoski Corporation and its partner companies. Myllykowki Group is
made up of MD Lang Papier, Myllykoski North America and Myllykoski Paper, The
Myllykoski Group is highly focused and ranks number three in production of [supercalendered
paper] in the world. In the production of [light-weight coated paper] the Myllykoski Group is in
the top four, The Myllykoski Group’s 2003 Net Sales in North America was 19%, Myllykoski
Corporation’s partners are M-real Corporation, the New York Times Company (US), the new
alliance partner Rhein Papier GmbH (Germany), and Sunila (Finaland), associated company of
Myliykoski Paper.” During the Class Period, Myliykoski was engaged in the business of
producing and selling Publication Paper within the United States, including this district.
26. Defendant Madison International Sales Company (“Madison”) is a company
organized and existing under the laws of the State of Delaware with its principal place of
business in Norwalk, Connecticut. Madison’s website states that “Madison International is the
U.S. sales company for the Myllykoski group of paper mills.” It also states, “Myllykoski has
sales offices all around the world, all part of the vast Myllykoski Sales Network. Madison
International is part of that sales network, and is owned by the mill, the only difference being
that we use the name ‘Madison’ here in the U.S. since it’s so well known with customers. But
when you think of us, you can think of Myllykoski. Myllykoski is the world’s 3rd largest
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producer of groundwood-contatining uncoated and coated publication papers.” Madison Paper
Industry, one of two divisions of Madison, is 40% owned by the New York Times Company,
During the Class Period, Madison was engaged in the business of producing and selling
Publication Paper within the United States, including this district.
27. Defendant Bowater, Inc. (“Bowater”) is a corporation organized and existing
under the laws of the State of Delaware with its principal place of business in Greenville, South
Carolina. Bowater’s website states that Bowater “is a leading producer of newsprint and coated
mechanical papers.” During the Class Period, Bowater was engaged in the business of producing
and selling Publication Paper within the United States, including this district.
CO-CONSPIRATORS
28. Various other persons, firms or corporations, not yet named as Defendants in this
lawsuit, participated as co-conspirators with Defendants in the offenses alleged and performed
acts and made statements in furtherance thereof.
CLASS ACTION ALLEGATIONS
29. Plaintiff brings this action on behalf of itself and as a class action under the
provisions of Rule 23(a), (b)(2) and (b)(3) of the Federal Rules of Civil Procedure on behalf of
the following class:
All persons (excluding governmental entities, Defendant, their
subsidiaries and affiliates, and their co-conspirators) who
purchased Publication Paper in the United States directly from any
of the Defendants or any subsidiary or affiliate thereof, or any co-
conspirator, at any time during the class period from January 1,
1990 to the present (the “Class”’).
30, Plaintiff does not know the exact size of the class, since such information is in the
exclusive control of Defendants. However, based on the nature of the trade and commerce
involved, Plaintiff believes that the class numbers at least in the thousands and that the members
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of the class are geographically dispersed throughout the United States. Therefore, joinder of all
members of the class would be impracticable.
31. There are questions of law or fact common to the class, including, but not limited
to:
a. whether Defendants conspired to fix, raise, maintain or stabilize the
prices of Publication Paper sold in the United States;
b. whether the alleged contract, conspiracy or combination violated
Section 1 of the Sherman Act;
C. the duration and extent of the contract, conspiracy or combination
alleged herein;
d, whether the Defendants and their co-conspirators took affirmative
steps to conceal the contract, conspiracy or combination;
e. whether each of the Defendants was a participant in the contract,
conspiracy or combination alleged herein;
f. whether the Defendants’ conduct caused the prices of Publication
Paper to be set at an artificially high and non-competitive level;
g. whether Defendants conspired to allocate markets for Publication
Paper sold in the United States;
h, whether Defendants’ conduct caused injury to the business or
property of Plaintiff and the class members and, if so, the
appropriate class-wide measure of damages;
1. whether Defendants took steps actively to conceal their conspiracy;
and
j. whether Plaintiff and the Class are entitled to declaratory and/or
injunctive relief.
These and other questions of law and fact predominate over any questions affecting only
individual members of the class.
32. The claims of Plaintiff are typical of the claims of the class in that Plaintiff,
through the aforementioned assignment, is a direct purchaser of Publication Paper whose
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purchases were, in all relevant respects, typical of purchases by other class members, and the
relief sought by Plaintiff, monetary damages, is common to the class.
33. Plaintiff will fairly and adequately protect the interests of the class in that Plaintiff
is a typical purchaser of Publication Paper, has no conflicts with any other members of the class
and is represented by counsel who are experienced and competent in the prosecution of complex
class action and antitrust litigation. Further, the interests of Plaintiff are coincident with, and not
antagonistic to, those of the class members.
34, Class action treatment is superior to the alternatives, if any, for the fair and
efficient adjudication of the controversy described herein, because such treatment permits a large
number of injured persons to prosecute their common claims in a single forum simultaneously,
efficiently and without unnecessary duplication of evidence and effort. Class treatment also
permits the adjudication of claims by smaller class members who could not afford to individually
litigate an antitrust claim against large corporate defendants.
35. Defendants have acted on grounds generally applicable to the entire Class,
thereby making final injunctive relief or corresponding declaratory relief appropriate with
respect to the Class as a whole. Prosecution of separate actions by individual members of the
Class would create the risk of inconsistent or varying adjudications with respect to individual
members of the Class that would establish incompatible standards of conduct for Defendants.
TRADE AND COMMERCE
36. All of the Defendants manufacture and/or sell Publication Paper either
independently or as part of a joint venture or merger. The Publication Paper products
manufactured and/or sold by one Defendant are comparable to and interchangeable with the
Publication Paper products manufactured and/or sold by the other Defendants.
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37, During the Class Period, Defendants sold Publication Paper in a continuous and
uninterrupted flow of interstate commerce, to customers located in countries and states other than
the countries or states in which Defendants produced Publication Paper. The business activities
of Defendants were thus within the flow of, and substantially affected, interstate trade and
commerce.
FACTS
38. The term “Publication Paper” includes Magazine Paper. The term “Magazine
Paper” includes both uncoated paper and coated magazine paper. As Defendant Stora Enso
states on its website, uncoated magazine paper “is used mainly for periodicals and advertising
material, such as inserts and flyers. It is also suitable for mass circulation TV magazines and
catalogues.” As Defendant International Paper states in their 2003 Annual Report, uncoated
papers are used for “advertising and promotional materials, such as brochures, pamphlets,
greeting cards, books, annual reports and direct mail publications.” With respect to coated
magazine paper, Defendant Stora Enso states on its website that it is available “in various matte,
silk, and glossy grades [and] is used for special interest and general interest magazines. Other
end-uses include supplements, home-shopping catalogues, and magazine covers.” As Defendant
International Paper states in their 2003 Annual Report, coated papers are “used in a variety of
printing and publication end uses such as catalogs, direct mailings magazines, inserts and
commercial printing.”
The World-Wide Antitrust Agency Raids on the Defendants’ Operations.
39. On Tuesday, May 25, 2004, the Reuters news agency reported the following:
A swathe of leading global forestry firms were raided by
competition enforcers on Tuesday as part of antitrust
operations on both sides of the Atlantic regarding price-
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fixing and manipulation of markets for various paper
products.
Raids were carried out by local or European Union antitrust
authorities at Finland’s UPM-Kymmene, Stora Enso,
Metsalitto and M-real and Norway’s Norske Skog. U.S. and
Canadian authorities cooperated.
International Paper Co., the top North American forest
products company, said it had been contacted by U.S.
officials in connection with the probe.
Later on Tuesday, the U.S. Justice Department confirmed it
is investigating possible anti-competitive practices in the
market for magazine paper. A department spokeswoman
said the probe covers the sale of magazine paper in the
United States and elsewhere.
The investigation also reached South Africa, where pulp and
paper maker Sappi said its European head office had been
raided. The company, the largest producer of fine paper
used for glossy magazines, said it had agreed to cooperate
with EU officials.
On May 25, 2004, the European Commission’s spokesperson for Competition
issued a press release and stated the following:
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Following press inquiries, the European Commission’s
spokesperson for Competition has confirmed that, on 25
May 2004, Commission inspectors, assisted by officials
from the national competition authorities of the Member
States concerned, launched simultaneous unannounced
inspections at the premises of some of the major European
producers of paper and forestry products.
The purpose of these inspections is to ascertain whether
there is evidence of cartel agreements and related illegal
practices concerning price-fixing, fixing of other
commercials terms, and/or allocation of customers. Several
product markets in the European paper and forestry products
sector would be affected the alleged arrangements.
The Commission’s spokesperson has also confirmed that the
inspections have been carried out in close coordination with
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competition authorities in a number of EU countries, as well
as the US and Canada. The EFTA Surveillance Authority, at
the request of the Commission, participated in the
inspections at premises of undertakings in the EFTA
Member States.
Surprise inspections are a preliminary step in investigations
into suspected cartels.
41, On May 25, 2004, the EFTA Surveillance Authority, an organization charged
with enforcing competition laws with respect to EFTA Member States Iceland, Liechtenstein and
Norway, issued a press release and stated the following:
Following inquires from journalists; the EFTA Surveillance
Authority confirms that on 25 May 2004, inspectors from
the EFTA Surveillance Authority, assisted by officials from
the Norwegian Competition Authority, carried out an
unannounced inspection at the premises of a producer of
publication paper in Norway. The purposes of the imspection
is to ascertain whether there is evidence of cartel agreements
and related illegal practices amongst EEA producers of
publication paper and amongst acquirers of recovered paper.
Surprise inspections are a preliminary step in investigations
into suspected cartels.
42. On May 27, 2004, the Reuters news agency reported that Defendant Stora Enso’s
CEO Jukka Harmala “told a forest industry seminar arranged by banking group Nordea that
‘(t]he time span (of the investigation). . . is likely not focusing on the past few years, but can go
back as far as (the) late eighties.” The Bloomberg News Agency also reported on May 28, 2004
that Stora’s CEO said that the investigation may lead back to the late 1980s. Reuters also
reported on May 27, 2004 that Defendant Myllykoski Corporation’s CEO Carl Bjornberg stated
at the same seminar that the industry had been “very much cartelized” during at least a portion of
the Class Period.
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Possible price Co-operation within i) the area of publication
paper, which includes newsprint and magazine paper and ii)
the purchase of recovered paper.
46. On May 24, 2004, Defendant M-real issued a press release in which it Stated the
following:
European Commission investigators have today visited M-
real Corporation’s premises. The investigation is related to
47, On May 25, 2004, Defendant Sappi issued a Press release in which it stated the
following:
Fine Paper’s European Head Office in Brussels as part of a
wide-spread anti trust investigation into a number of paper
manufacturers and appears to involve a wide range of
products.
48. On May 25, 2004, Defendant Stora Enso issued a press release in which it Stated
the following:
European Commission competition investigators have today
visited Stora Enso’s premises in London, Stockholm, and
Dusseldorf .
Representatives of the F innish Competition Authority visited
Stora Enso Forest’s office at Imatra and regional offices at
Summa, Joensuu, Savontinna and Kuopio in Finland.
In addition, the Company’s North American division has
Teceived a subpoena for documents from the Antitrust
Division of the US Department of Justice.
Defendants’ Unlawful Contract, Conspiracy or Combination.
49, Beginning at least as early as January 1, 1990, and continuing through present, the
exact dates being unknown to Plaintiff, Defendants and their co-conspirators engaged in a
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continuing agreement, understanding, and conspiracy in restraint of trade to artificially raise, fix,
maintain or stabilize the price of Publication Paper in the United States.
50. In formulating and effectuating the alleged contract, conspiracy or combination,
Defendants and their co-conspirators engaged in anti-competitive activities, the purpose and
effect of which were to artificially raise, fix, maintain or stabilize the price of Publication Paper
in the United States. These activities included the following:
a. Defendants exchanged information on prices being charged for
Publication Paper sold to customers,
b. Defendants agreed to charge prices at specified levels and otherwise to
increase and/or maintain the price of Publication Paper in the United
States and elsewhere,
c. Defendants issued price announcements and price quotations in
accordance with the agreements reached, and
d. Defendants sold Publication Paper in the United States at non-competitive
prices.
51. Defendants and their co-conspirators engaged in the activities described above for
the purpose of effectuating the unlawful agreements described in this Complaint.
52. During and throughout the period of the conspiracy alleged in this Complaint,
Plaintiff and members of the Class purchased Publication Paper from Defendants (or their
subsidiaries or controlled affiliates) or their co-conspirators at inflated and supracompetitive
prices.
$3. In formulating and effectuating the contract, conspiracy or combination,
Defendants and their co-conspirators engaged in anticompetitive activities, the purpose and
effect of which were to artificially raise, fix, maintain and/or stabilize the price of Publication
Paper sold in the United States. These activities included the following:
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: -11583-GA
O Document 1 Filed 07/15/2004 P
age 17 of 21
ons, including
and/or conversati
to discuss the p
ations and conventions,
ed States;
Defendants particip ated in meetings
ghrough various trade organiz rice
of Publication Paper in the Unit
ants agreed during those meetings and conversations to charge
ed levels and otherwise {o increase and/or maintain prices
b. Defend
d in the United States,
rices at specifi
of Publication Paper so
etings and conversati
Defendants agreed during those me
price of Publication Paper; an
ce announcements and price quotations in
Defendants issued pri
accordance with the agreements reached.
unreasonable
ation constitutes an
conspiracy OF combin
ons 1 and 3 of the
Defendants’ contract,
gn trade and commer
54.
ein violation of Secti
restraint of interstate and forei
Sherman Act.
ants’ unlawful conduct, Plaintiff and the other members of
As a result of Defend
operty in that they have
55.
paid more for
their business and pr
the Class have been injured in
na competitive market.
Publication Papet than they would have paid i
¢, conspiracy and/or combination has had the following
56. The unlawful contrac
effects, among others:
arket has been artificially
a. price competition in the Publication Paper m
restrained;
b. rices for Publication Paper sold by the Defendants have been raised,
fixed, maintained, OF stabilized at artificially high and non-competitive
levels;
ublication Paper from the Defendants have been deprived
etition in the markets for Publication
purchasers of P
of the benefit 0
Paper.
f free and open comp
mate result of the illegal contract, conspiracy oF combination,
57. Asa direct and proxi
Plaintiff and the members of the Class have been injured and financially damaged 10 their
they paid more for Publication Paper than they would
respective pusinesses and property, in that
18
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have paid in the absence of the illegal contract, conspiracy or combination. Plaintiff and
members of the Class thus have suffered damages in an amount presently undetermined.
Defendants and their co-conspirators are jointly and severally liable for all damages cause by
their conspiracy.
FRAUDULENT CONCEALMENT
60. Until recently, neither Plaintiff nor the class members had knowledge of any of
the violations alleged herein. Further, neither Plaintiff nor the class members, until recently,
could have discovered, by the exercise of reasonable diligence, that Defendants and their co-
conspirators had engaged in the violations alleged herein since Defendants and their co-
conspirators actively and fraudulently concealed these violations so as to obscure their illegal
activity.
61. Defendants engaged in a successful, iltegal price-fixing conspiracy that, by its
nature, was inherently self-concealing.
62, Plaintiff and the class members could not have discovered the alleged contract,
combination and conspiracy at an earlier date by the exercise of reasonable diligence because of
the deceptive practices and techniques secrecy employed by Defendants and their co-
conspirators to avoid detection of, and to fraudulently conceal, their contract, combination and
conspiracy, Defendants fraudulently concealed the contract, combination and conspiracy herein
alleged by various means and methods, including, but not limited to, secret mectings,
misrepresentations to customers concerning the reason for price increases and surreptitious
communications between Defendants by the use of the telephone or in-person meetings at trade
associations meetings (and elsewhere) in order to prevent the existence of written records.
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63. The affirmative actions of the Defendants herein alleged were wrongfully
concealed and carried out in a manner that precluded detection.
64. Defendant also fraudulently concealed their contract, conspiracy or combination
in other ways as well. For example, Defendants falsely represented to their customers that
Publication Paper price increases were due to increases in the cost and supply of raw materials
when, in fact, these price increases were the direct result of collusive activity among Defendants
as alleged herein.
65. By virtue of the fraudulent concealment by Defendants and their co-conspirators,
the running of any statute of limitations has been tolled and suspended with respect to any claims
that Plaintiff and the other class members have as a result of the unlawful contract, combination
and conspiracy alleged in this Complaint
EFFECTS/DAMAGES
66. Defendants’ contract, combination and conspiracy had the following effects,
among others:
a. prices charged by Defendants and their respective subsidiaries and
co-conspirators to Plaintiff and the members of the class were
maintained at artificially high and non-competitive levels;
b. buyers of Publication Paper were deprived of free and open
competition in the purchase of Publication Paper; and
C. competition in the sale of Publication Paper was unreasonably
restrained.
67. During and throughout the Class Period, Plaintiff and members of the class
purchased Publication Paper from one or more of the Defendants, their respective subsidiaries,
affiliates and/or co-conspirators.
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as >
68. Asa direct and proximate result of Defendants and their ¢O-conspirators’ j
contract combination and conspiracy, Plaintiff and the members of the class were injured and
financially damaged in their businesses and Property in that they paid more for Publication Paper
than they would have in the absence of Defendants and their co-conspirators’ unlawfy] activities.
The total amount of damages is Presently undetermined.
69. The contract, conspiracy or combination complained of herein wil] continue
combination is enjoined.
PRAYER FOR RELIEF
SS ENR RELIEF
70. WHEREF ORE, Plaintiff prays as follows:
a. That the Court determine this action may be maintained as a class
c. That judgment be entered for Plaintiff and the members of the
class against Defendants for three-fold the amount of damages
sustained by Plaintiff and the class as allowed by law, together
with the costs of this action, including reasonable attorneys’ fees:
d. That Plaintiff and members of the Class be awarded pre-and post-
e. That Defendants, their affiliates, successors, transferees, assignees,
and the officers directors, partners, agents and employees thereof,
Permanently enjoined and restrained from in any manner: (1)
continuing, maintaining, or renewing the contract, conspiracy or
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combination alleged herein, or from entering into any other
conspiracy alleged herein, or from entering into any other contract,
conspiracy or combination having a similar purpose or effect, and
from adopting or following any practice, plan, program, or device
having a similar purpose or effect; and (2) communicating or
causing to be communicated to any other person engaged in the
manufacture, distribution or sale of Publication Paper, information
concerning prices or other terms or conditions of sale of any such
products except to the extent necessary in connection with bona
fide sales transactions between the parties to such communications;
and
f. That Plaintiff and members of the class have such other, further
and different relief as the Court may deem just and proper under
the circumstances.
DEMAND FOR JURY TRIAL
71. Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands
a trial by jury of all the issues triable of right by jury.
DATED: July {Ss , 2004 BERMAN DEVALERIO PEASE TABACCO
BURT & PUCILLO
2, AQ
Peter A. Pease
One Liberty Square
Boston, MA 02109
Telephone: (617) 542-8300
Facsimile: (617) 542-1194
Samuel D. Heins
Vincent J. Esades
HEINS MILLS & OLSON, P.L.C.
3550 JDS Center
80 South Eighth Street
Minneapolis, Minnesota 55402
Telephone: (612) 338-4605
Facsimile: (612) 338-4692
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