Drywall Manufacturers Face Price-Fixing Lawsuits

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Philadelphia, PA: Drywall price-fixing lawsuits, filed against numerous defendants, are growing. Because they are so similar in nature, they have been consolidated into a multi-district litigation or MDL.

The latest lawsuit was filed by New York-based Ashford Gypsum Services Inc (AGSI) on behalf of itself and others similarly situated. The MDL cases allege gypsum board manufacturers conspired, from at least 2008 to the present, to fix, raise, maintain and stabilize the price of drywall sold in the country.

Defendants listed in the lawsuit filed April 29th by AGSI include, but aren't limited to, National Gypsum Co., LaFarge North America Inc., American Gypsum Co., Georgia-Pacific LLC, USG Corp. and Certainteed Corp.

Specifically, the lawsuit alleges that the drywall price-fixing conspiracy is an outgrowth of the 2007 housing crash, the largest housing crash in US history, the lawsuit claims.

"The decline in demand for housing during real estate downturn produced a corresponding decline in demand for drywall, resulting in tremendous overcapacity,"the lawsuit states. "The decline in demand translated to lost profits and the threat of further lost profits to Defendants. In the face of this decreased demand, Defendants attempted to, and actually did, increase prices--something that they would not, nor could not, have done in a competitive market."The lawsuit contends "Absent the alleged conspiracy, this could not, and would not, have happened."And "Drywall prices would have languished with housing prices."

Further, the lawsuit contends that simultaneous to the alleged price-fixing the defendants also engaged in a "drastic departure"from prior industry practice in which customers were able to lock in drywall prices for the duration of a construction project, a process referred to as "job quotes."

"The primary effect of Defendants' agreement to eliminate job quotes was to increase the price of drywall,"the lawsuit states.

The complaint accuses the defendants of engaging in fraudulent concealment, and it also alleges that the drywall manufacturers violated the Sherman and Clayton Antitrust Acts. The plaintiffs seek monetary damages as well as injunctive relief against each of the defendants.

The latest drywall price-fixing lawsuit was filed by North Carolina attorneys Larry S. McDevitt and David M. Wilkerson, of The Van Winkle Law Firm, and Minnesota lawyers David M. Cialkowski, Anne T. Regan and Brian C. Gudmundson, of Zimmerman Reed LLP.The federal case number is 2:13-cv-02295-MMB.

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