IN RE: Marine Construction Antitrust Litigation

Case MDL No. 417 Document 2 Filed 05/20/15 Page 1 of 9
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BEFORE THE JUDICIAL PANEL omg TE IE |
ON =2 om 2B
: MULTIDISTRICT LITIGATION ox RP mE	hh and — —
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IN RE MARINE CONSTRUCTION ) DOCKET NO. 417 C=
ANTITRUST LITIGATION ) Es =] =e
OPINION AND ORDER FIA EC SHEE
BEFORE ANDREW A. CAFFREY, CHAIRMAN+*, ROY W. HARPER, CHARLES
R. WEINER, EDWARD S. NORTHROP, AND ROBERT H. SCHNACKE,
JUDGES OF THE PANEL. .
PER CURIAM A
This litigation consists of 66 actions pending in _
four federal districts: 49 in the Southern District of Co
Texas; nine in the Eastern District of Louisiana; seven
in the Northern District of Illinois; and one in the Southern
District of New York. oo Sl
The 66 actions were spawned by the indictment of J. :
Ray McDermott and Co., Inc. (McDermott); four of its executive
officers; Brown and Root, Inc. (Brown and Root); and two Go
of its executive officers. The indictment was filed on EE
December .14, 1978, by a federal grand jury sitting in New
Orleans, Louisiana, and charges defendants with violating
the federal antitrust laws by conspiring to fix prices SE i
and to eliminate competition in the marine construction : :
industry. }
* Judge Caffrey took no part in the decision of this matter.
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1 Each of the 66 complaints, all but two of which were ‘ Sn
2 filed during December, 1979, names as defendants both McDermott : Co
3 and Brown and Root. In addition, about one-third of the EE
4 complaints name as defendants Halliburton Company (Halli-
5 burton), Brown and Root's parent corporation; and/or Oceanic
6 Contractors, Inc. (Oceanic), a subsidiary of McDermott. EE
; Two actions also name certain of defendants' executive SR vi
officers. RE
8
All of the actions before the Panel are based on virtually :
9 identical factual and legal allegations that track those | :
J contained in the Government's indictment. Basically, all - :
L plaintiffs allege that since at least as early as 1960, oo } Lo
> the defendants and various named and unnamed co-conspirators
3 have conspired, in violation of Sections 1 and 2 of the
| Sherman Act, to suppress and eliminate competition in the :
marine construction industry, and to fix, maintain and GL .
establish prices for marine construction services at artificial i
and non-competitive levels. Each complaint also alleges
that the conspiracy was fraudulently concealed. About two-thirds Ea :
of the complaints contain an allegation that defendants i |
: violateda state deceptive practices statute. Plaintiffs
in each action seek treble damages, and in about two-thirds
of the actions the plaintiffs also seek injunctive relief. - .
Presently before the Panel are two motions and a cross- }
motion to centralize all actions in this litigation in -
a single district pursuant to 28 U.S.C. §1407 for coordinated BN
or consolidated pretrial proceedings. All responding parties :
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. 1 agree on the propriety of, or do not oppose, transfer.
®o 2 These parties agree that the 66 actions raise common factual
3 questions because of the virtually identical antitrust
" allegations of the 66 complaints. These parties further
agree that transfer under Section 1407 is necessary in
> order to prevent duplication of discovery, eliminate the
6 possibility of conflicting pretrial rulings and conserve
7 judicial resources. The only dispute concerns the selection
8 of the transferee district. McDermott, Oceanic, and four
9 executive officers of McDermott and Oceanic favor centrali-
10 zation in the Eastern District of Louisiana; plaintiffs
11 in the 49 actions pending in the Southern District of Texas,
plaintiffs in three of the nine actions pending in Louisiana,
12 and defendants Brown and Root and Halliburton favor
9 13 centralization in the Southern District of Texas; plaintiffs
14 in the seven actions pending in the Northern District of
15 Illinois favor centralization in that district, or alternatively
16 the Illinois plaintiffs favor centralization in the Southern
17 District of Texas. Plaintiffs in the New York action consider
18 the Southern District of New York to be an appropriate |
19 forum for their actions, but the New York plaintiffs
nevertheless favor the Southern District of Texas as the
20 transferee district for centralized pretrial proceedings
21 under Section 1407.
22 We find that the 66 actions involve common questions
23 of fact and that transfer of the actions pending in districts
24 other than the Eastern District of Louisiana to that district
9,
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1 for centralized pretrial proceedings with the actions pending
2 there will best serve the convenience of the parties and
3 witnesses and promote the just and efficient conduct of
4 the litigation.
Those parties favoring the Southern District of Texas
> as the transferee district support that district because:
6 (1) 49 of the 66 actions are pending in the Southern District
7 of Texas; (2) the majority of the parties to the litigation
8 favor the Southern District of Texas; and (3) Brown and
9 Root, as well as many of the plaintiffs, have their principal
10 places of business in Houston. These parties discount
11 the importance of the fact that the relevant grand jury
proceedings occurred in the Eastern District of Louisiana
+2 by pointing out that McDermott and Brown and Root have
13 demonstrated a willingness to make copies of at least some
14 of the documents submitted by them to the grand jury available
15 to plaintiffs.
16 The plaintiffs in the Illinois actions favor centrali-
17 zation in the Northern District of Illinois on the grounds
18 that: (1) docket congestion is less in the Northern District |
19 of Illinois than in either the Southern District of Texas
or the Eastern District of Louisiana and therefore the
20 actions could proceed most expeditiously in the Northern
21 District of Illinois; (2) Chicago is centrally located
22 and therefore convenient for a litigation that is nationwide
23 in scope; and (3) both Brown and Root and McDermott have
24 offices in the Chicago area.
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: 1 Although we are of the view that either the Southern
C 2 District of Texas or the Eastern District of Louisiana
3 could be described as an appropriate transferee forum for
4 this litigation, on balance we conclude that the Eastern
5 District of Louisiana is preferable. Because one of the
two principal defendants has its principal place of business
© in each of these two districts, many relevant documents
7 and witnesses will likely be located in both jurisdictions.
8 The fact that the relevant grand jury proceedings occurred
9 in the Eastern District of Louisiana, however, tips the
10 scales in favor of that forum under the circumstances in
11 this litigation.
12 The documents and transcripts of the testimony on
which the grand jury relied in returning its indictment
® + and which have been sought by the private litigants are
14 located in the Eastern District of Louisiana. See In re
15 Hawaiian Hotel Room Rate Antitrust Litigation, 458 F. Supp.
16 935, 936 (J.P.M.L. 1977). Furthermore, the United States
17 Supreme Court, in Douglas 0il Company Vv. Petrol Stops Northwest,
18 441 U.S. 211 (1979), has required, with respect to access
19 to grand jury materials in related private antitrust actions,
20 coordination between the court presiding over the grand
jury proceedings and the court presiding over the private
21 antitrust actions. This coordination can more easily be
22 accomplished by selecting as transferee district the same
23 district in which the grand jury sat and returned an indictment
24 against the principal defendants. See In re California
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1 Armored Car Antitrust Litigation, 476 F. Supp. 452, 454 .|
2 (J.P.M.L. 1979).
3 IT IS THEREFORE ORDERED that, pursuant to 28 U.S.C.
4 §1407, the actions listed on the following Schedule A and
pending in districts other than the Eastern District of
° Louisiana be, and the same hereby are, transferred to the
© Eastern District of Louisiana and, with the consent of
7 that court, assigned to the Honorable Jack M. Gordon for
8 coordinated or consolidated pretrial proceedings with the
9 actions pending in that district and listed on Schedule
10 A.
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’ DOCKET NO. 417
Schedule A
. Northern District of Illinois
1 Natural Gas Pipeline Co. of America, Inc. v. J. Ray McDermott
® & Co., Inc., et al., C.A. No. 79C26682 Napeco, Inc. v. J. Ray McDermott & Co., Inc., et al.,C.A. No. 79C5236
3 Kerr-McGee Corp. v. J. Ray McDermott & Co., Inc., et al.,	C.A. No. 79C5242
‘Michigan Wisconsin Pipe Line Co. v. J. Ray McDermott & Co.,
4 Inc., et al., C.A. No. 79C5249
American Natural Gas Production Co. v. J. Ray McDermott
5 Co., Inc., et al., C.A. No. 79C5250
Santa Fe Energy Co., et al. v. J. Ray McDermott & Co.,
6 inc., et al., C.A. No. 79C5267
Felmont Oil Corp., et al. v. J. Ray McDermott & Co., Inc.,
vi et al., C.A. No. 79C5268Eastern District of Louisiana
Columbia Gas Development Corp., et al. v. J. Ray McDermott
8 § Co. Inc.., et al., C.A. No. 79-4986-G(4)
Consolidated Gas Supply Corp. v. J. Ray McDermott & Co.,
9 Inc., et al., C.A. No. 79-5005-A(5)
CNG Producing Co. v. J. Ray McDermott & Co., Inc., et al.,
10 C.A. No. 79-5006-C(3)
Forest Oil Corp., et al. v. J. Ray McDermott & Co., Inc.,
11 et al., C.A. No. 79-5008-J(4)(5)Mobil 0il Corp., et al. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. 79-5021-G(2)
12 Ocean Drilling & Exploration Co., et al. v. J. Ray McDermott
® & Co., Inc., et al., C.A. No. 79-5026-M(5)	13 Koch Industries, Inc. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. 79-5029-K(4)	(3)
14 Newmont 0il Co. v. J. Ray McDermott & Co., Inc., et al.,
C.A. No. 79-5030-G(4)
15 Columbia Gulf Transmission Co. v. J. Ray McDermott & Co.,inc., et al., C.A. No. 79-4985-I(2)
16 Southern District of New York :Texaco Inc., et al. v. J. Ray McDeromott &§ Co., Inc.,
et al., C.A. No. 79 Civ 6764
17 Southern District of Texas i
Tenneco Inc., etc. v. J. Ray McDermott & Co., Inc., et al.,
18 | C.A. No. 79-H-1329| Tenneco Oil Co., et al. v. J. Ray McDermott & Co., Inc., |19 et al., C.A. No. H-79-2497
Crystal 0il Co., et al. v. J. Ray McDermott & Co., Inc.,
20 et al., C.A. No. H-79-2498Pan Eastern Exploration Co., et al. v. J. Ray Mcbhermott
& Co., et al., C.A. No. H-79-2499
21 Texas Eastern Transmission Corp., et al. v. J. Ray McDermott
& Co., et al., C.A., No. H-79-2500 -
22 Trunkline Gas Co. v. J. Ray McDermott & Co., Inc., et al.,
C.A. No. H-79-2501
23 Stingray Pipeline Co., et al. v. J. Ray McDermott & Co.,
Inc., et al., C.A. No. H-79-2502
C 24 Southern Natural Gas Co., et al. v. J. Ray McDermott &	Co., et al., C.A. No. H-79-2503
Clark Oil Producing Co. v. Brown & Root, Inc., et al.,
25 C.A. No. H-79-2504

oo Case MDL No. 417 Document 2 Filed 05/20/15 Page 8 of 9
DOCKET NO, 417 -- continued
Schedule A -- p.2 )
1 Southern District of Texas (Continued)
Wintershall 0il &§ Gas Co. v. J. Ray Mcbhermott Co., Inc.,
2 et al., C.A. No. H-79--2506
American Petrofina Co. of Texas, et al. v. J. Ray McDermott
3 Co., et al., C.A. No. H-79-2507
Phillips Petroleum Co., et al. v. J. Ray McDermott & Co.,
Inc., et al., C.A. No. H-79-2508
4 Clam Petroleum Co. v. J. Ray McDermott & Co., Inc., et al.,
"C.A. No. H-79-2510
5 Cities Service Co., et al. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. H-79-2511
6 Norsk Hydro a.s., et al. v. J. Ray McDermott & Co., Inc.,
et al,, C.A. No. H-79-2514
7 Allied Chemical Corp. v. Brown & Root, Inc., et al.,
C.A. No. H-79-2515
Conoco Inc. v. Halliburton Co., et al.,
8 C.A. No. H-79-2516
- Exxon Corp., et al. v. Brown & Root, Inc., et al.,
9 C.A. No. H-79-2517
General American Oil Co. of Texas v. Brown & Root, Inc.,
10 et al., C.A. No. H-79-2518
Pennzoil Producing Co., et al. v. Brown & Root, Inc.,
11 et al. , C.A, No. H-79-2519 .
Transcontinental Gas Pipe Line Corp. v. Brown & Root, Inc.,
et al., C.A. No. H-79-2520
12 United Gas Pipe Line Co., Inc., et al. v. Halliburton Co.,
et al., C.A. No. H-79-2521
13 The Northwestern Mutual Life Insurance Co. v. J. Ray McDermott
& Co., Inc., et al., C.A No.H-79-2523
14 High Island Offshore System, et al. v. J. Ray McDermott
& Co., Inc., et al., C.A. No. H-79-2524
15 Hamilton Brothers 0il Co., et al. v. J. Ray McDermott &
Co., Inc., et al., C.A. No. H-79-2525
16 Texas Gas Transmission Corp., et al. v. J. Ray McDermott
& Co., Inc., et al., C.A. No. H-79-2526
U-T Offshore System, et al. v. J. Ray McDermott & Co., Inc., :
17 et al., C.A. No. H-79-2527
Gulf 0il Corp., et al. v. J. Ray McDermott & Co., Inc.,
18 et al., C.A. No. H-79-2528
Freeport Minerals Co., etc. v. J. Ray McDermott §& Co., Inc.,
19 et al., C.A. No. H-79-2529
Terra Resources, Inc., et al. v. J. Ray McDermott & Co.,
20 Inc., et al., C.A. No. H-79-2530 TT
Energy Reserves Group, Inc., et al. v. J. Ray McDermott
& Co., Inc., et al., C.A. No. H~79-2531
21 Tesoro Petroleum Corp., et al. v. J. Ray McDermott & Co.,
Inc., et al., C.A. No. H-79-2532
22 Aminoil International, Inc., et al. v. J. Ray McDermott
& Co., Inc., et al., C.A. No. H-79-2533
23 Vallero Energy Corp., et al. v. J. Ray McDermott & Co.,
Inc., et al., C.A. No. H-79-2534
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Case MDL No. 417 Document2 Filed 05/20/15 Page	9 of 9
5 Docket No. 417 -- Continued
Schedule A -- p.3
«1 Southern District of Texas (Continued)
El Paso Natural Gas Co. v. J. Ray McDermott	& Co., Inc.,
C 2 et al., C.A. No. H-79-2535Union Oil. Co. of California; et al. v. J. Ray McDermott
3 § Co., Inc., et al., C.A. No. H-79-2536Amax Petroleum Corp. v. J. Ray McDermott & Co., Inc.,
. | et al., C.A. No. H-79-2538
4 OKC Corp. v. J. Ray McDermott & Co., Inc., et al.,
C.A. No. H-79-2539
5 Home Petroleum Corp. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. H-79-2540
6 Getty 0il Co., et al. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. H-79-2541
v H.W. Bass & Sons, Inc. v. J. Ray McDermott & Co., Irc.,et al., C.A. No. H-79-2542
The Louisiana Land and Exploration Co., et al. v. J. Ray
8 McDermott & Co., Inc., et al., C.A. No. H-79-2543
The Dow Chemical Co., et al. v. Brown & Root, Inc., et al.,
9 } C.A. No. H-79-2546
Shell 0il Co., et al. v. Brown	& Root, Inc., et al.,
10 C.A. No. H-79-2547
Ashland 0il Inc., et al. v. Brown & Root, Inc., et al.,
11 C.A. No. H-79-2548
The Superior 0il Co., et al. v. Brown & Root, Inc., et al.,
C.A. No. H-79-2553 .
12 J. S. Abercrombie Mineral Co. v. J. Ray McDermott & Co.,
Inc., et al., C.A. No. H-79-2554
( ] 13 Arabian American 0il Co., et al. v. Brown & Root, Inc.,et al., C.A. No. H-79-2559
14 Southland Royalty Co. v. J. Ray McDermott & Co., Inc.,
et al., C.A. No. 79-257Z
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