1 ROBBINS GELLER RUDMAN & DOWD LLP 2 JOHN J. STOIA, JR. (141757) BONNY E. SWEENEY (176174) 3 THOMAS R. MERRICK (177987) ALEXANDRA S. BERNAY (211068) 4 CARMEN A. MEDICI (248417) 655 West Broadway, Suite 1900 5 San Diego, CA 92101 Telephone: 619/231-1058 6 619/231-7423 (fax) johns@rgrdlaw.com 7 bonnys@rgrdlaw.com tmerrick@rgrdlaw.com 8 xanb@rgrdlaw.com cmedici@rgrdlaw.com 9 THE KATRIEL LAW FIRM 10 ROY A. KATRIEL (pro hac vice) 1101 30th Street, N.W., Suite 500 11 Washington, DC 20007 Telephone: 202/625-4342 12 202/330-5593 (fax) rak@katriellaw.com 13 Co-Lead Counsel for Plaintiffs 14 [Additional counsel appear on signature page.] 15 UNITED STATES DISTRICT COURT 16 NORTHERN DISTRICT OF CALIFORNIA 17 SAN FRANCISCO DIVISION 18 THE APPLE IPOD ITUNES ANTI-TRUST ) Lead Case No. C-05-00037-JW(HRL) 19 LITIGATION ) ) CLASS ACTION 20 ) ) SUPPLEMENTAL BRIEF IN SUPPORT OF This Document Relates To: 21 ) PLAINTIFFS’ RENEWED MOTION FOR ) CLASS CERTIFICATION AND RESPONSE ALL ACTIONS. 22 ) TO COURT’S MAY 19, 2011 ORDER 23 JUDGE: DATE: TIME: CTRM: 24 25 26 27 28 627193_2 Chief Judge James Ware June 27, 2011 9:00 a.m. 5 – 17th Floor 1 I. INTRODUCTION 2 In the Court’s May 19, 2011 Order, the Court requested further briefing regarding two issues 3 related to Plaintiffs’ class certification motion.1 The Court asked the parties to file simultaneous 4 supplemental briefs addressing “how the class should be defined and the length of the class period in 5 light of the Court’s ruling on Defendant’s Motion for Summary Judgment.” Id. at 15. The Court 6 made clear in its ruling that “[b]ecause . . . there is a genuine issue of fact as to whether Plaintiffs can 7 state a claim under the Sherman Act for iTunes 7.0, the Court’s earlier findings that Plaintiffs’ 8 proposed class satisfies the requirements of Rule 23(a) and 23(b)(3) still stand.”2 9 In accordance with the Court’s May 19, 2011 and December 22, 2008 Orders, Plaintiffs 10 propose the following class definition: 11 All persons or entities, including resellers, in the United States (excluding federal, state and local governmental entities, Apple, its directors, officers and members of their families) who purchased an iPod directly from Apple between September 12, 2006 and March 31, 2009 (“Class Period”). 12 13 A. Class Definition 14 As Plaintiffs explained in their Reply Memorandum in Support of Plaintiffs’ Renewed 15 Motion for Class Certification (“Reply Mem.”), the class properly includes all direct purchasers of 16 iPods, including resellers.3 Dkt. No. 566. As the Court has previously stated: “[T]he Court 17 18 19 20 1 Dkt. No. 627 (Order Granting in Part and Denying in 21 Judgment; Denying as Premature Plaintiffs’ Motion for ClassPart Defendant’s Motion for Summary Certification (“May 19, 2011 Order”)). 22 2 Id. at 14 (citing Dkt. No. 196 (Order Granting Plaintiffs’ Motion for Class Certification as to Count’s Two, Three, Four, Five, Six and Seven Only and Appointing Class Counsel Sua Sponte 23 Order Reconsidering Defendant’s Motion to Dismiss Count One and Requiring Further Briefing 24 (“December 22, 2008 Order”) at 4-13)). 3 Plaintiffs that can properly 25 represent all classbelieve they have demonstratedIf the the named class representatives a reseller can members, including resellers. Court finds, however, that only represent the 26 Penney Co.,resellers in the proposed class, a reseller can intervene in the action. Wambheim v. J.C. No. C-75-2486-WTS, 1977 U.S. Dist. LEXIS 13852 (N.D. Cal. Sept. 22, 1977) (granting motion to intervene to represent subclass of workers). Plaintiffs Melanie Tucker and 27 Mariana Rosen purchased iPods after September 12, 2006 and plainly have standing. 28 627193_2 SUPPLEMENTAL BRIEF IN RESPONSE TO COURT’S MAY 19, 2011 ORDER - C-05-00037- JW(HRL) -1- 1 considered Defendant’s contentions that resellers should be excluded from the class definition” and 2 “included resellers in the certified class.”4 3 As Plaintiffs detailed in their Reply Mem., resellers have always been included in the direct 4 purchaser class definition.5 Although Apple argued in opposition that Plaintiffs somehow waived 5 the right to include resellers in the class definition, Apple’s argument was unsupported and contrary 6 to the clear record in this case. Reply Mem. at 10. Plaintiffs’ expert, Professor Roger G. Noll, 7 addressed in detail both kinds of direct purchasers in his January 18, 2011 declaration.6 Plaintiffs 8 have also diligently sought discovery as to resellers throughout the litigation.7 Even Apple’s expert 9 acknowledged the class includes resellers.8 Moreover, because Plaintiffs allege damages based on 10 an overcharge theory, everyone, including resellers, who purchased an iPod from Apple was 11 damaged by Apple’s anticompetitive conduct.9 See Reply Mem. at 12. 12 13 14 15 16 17 4 18 Dkt. No. 198 (Order Vacating Case Management Conference; Clarifying and Correcting Class Certification Order; Setting Briefing Schedule (“January 15, 2009 Order”) at 2). 19 5 See also Dkt. No. 532 (Plaintiffs’ Notice of Motion and Renewed Motion for Class Certification and Appointment of Lead Class Counsel); Dkt. No. 534 (Declaration of Bonny E. 20 Sweeney in Support of Plaintiffs’ Notice of Motion and Renewed Motion for Class Certification and 21 Appointment of Lead Class Counsel). 6 See, e.g., Dkt. No. 535 (Declaration of Roger G. Noll (“Noll Decl.”) at 14-17) (discussing 22 data issues with regard to resellers); id. at 69-70 (addressing damages methodology for resellers). 23 7 Dkt. No. 568 (Declaration of Alexandra S. Bernay in Support of Reply Memorandum in 24 Support of Plaintiffs’ Renewed Motion for Class Certification (“Bernay Decl.”)), ¶¶8, 17-28. 8 of 25 CarmenDkt. No. 530 at 2-3 (Expert Report of Dr. Michelle M. Burtis); Dkt. No. 569 (Declarationfor A. Medici in Support of Reply Memorandum in Support of Plaintiffs’ Renewed Motion 26 Class Certification (“Medici Decl.”), Ex. 1 at 46:18-25 (Burtis Depo.)). 9 See also Noll Decl.; Dkt. No. 567 (Reply Declaration of Roger G. Noll); Bernay 27 Decl.; Medici Decl. 28 627193_2 SUPPLEMENTAL BRIEF IN RESPONSE TO COURT’S MAY 19, 2011 ORDER - C-05-00037- JW(HRL) -2- 1 Apple’s other arguments regarding resellers were also not well taken. Reply Mem. at 11. 2 Apple wrongly argued that resellers were not “similarly situated” to retail purchasers because 3 resellers do not pay retail prices.10 However, Apple’s own internal documents show that the 4 wholesale price resellers pay is based on retail prices. Id. at 22 (resellers’ wholesale price is “set at 5 varying discounts from Apple’s retail price”). Therefore, if the retail price was impacted by Apple’s 6 monopoly maintenance scheme, the resellers also automatically paid more for their wholesale price. 7 See also Noll Reply Decl. at 27. 8 Apple’s claim that resellers could actually have benefited from higher retail prices has also 9 been thoroughly rebutted. Reply Mem. at 11. As Plaintiffs explained, under settled federal antitrust 10 law, a “pass-on” or “otherwise benefited” defense is barred. See Hanover Shoe, Inc. v. United Shoe 11 Mach. Corp., 392 U.S. 481, 489, 88 S. Ct. 2224 (1968) (disallowing “pass on” defense; “[a]s long as 12 the seller continues to charge the illegal price, he takes from the buyer more than the law allows”). 13 Apple’s other arguments regarding resellers related to typicality and supposed conflicts suffered 14 from similar flaws. See Reply Mem. at 12-14. Apple points to nothing that would cause the Court 15 to disturb its earlier ruling that resellers are naturally included in the class. January 15, 2009 Order 16 at 2. In sum, nothing substantive has changed with regard to the class definition. The Court’s 17 18 Order finding that a genuine issue of material fact exists as to Plaintiffs’ antitrust claims related to 19 iTunes 7.0 does not change the composition of the direct purchaser class. 20 B. 21 As Apple’s internal documents reveal, iTunes 7.0 was released to the public on September Class Period 22 12, 2006.11 This date, in line with the Court’s May 19, 2011 Order, properly serves as the starting 23 date for the Class Period. “The relevant time, often referred to as the ‘class period,’ is, for example, 24 the period during which members of the proposed class incurred the claimed injury.” Manual for 25 10 26 Dkt. No. 529 at 21-23 (Apple’s Opposition to Renewed Motion for Class Certification). 11 Dkt. No. 539 (Declaration in Plaintiffs’ Memorandum in 27 Opposition to Apple’s Motion for of Bonny E. SweeneyEx.Support oflisting release dates)). Summary Judgment, 36 (chart 28 627193_2 SUPPLEMENTAL BRIEF IN RESPONSE TO COURT’S MAY 19, 2011 ORDER - C-05-00037- JW(HRL) -3- 1 Complex Litigation (Fourth) §21.222. Therefore, the Class Period for the proposed class should run 2 from the iTunes 7.0 release date, September 12, 2006 through March 31, 2009. 3 DATED: June 6, 2011 Respectfully submitted, 4 ROBBINS GELLER RUDMAN & DOWD LLP JOHN J. STOIA, JR. BONNY E. SWEENEY THOMAS R. MERRICK ALEXANDRA S. BERNAY CARMEN A. MEDICI 5 6 7 8 s/ Bonny E. Sweeney BONNY E. SWEENEY 9 10 655 West Broadway, Suite 1900 San Diego, CA 92101 Telephone: 619/231-1058 619/231-7423 (fax) 11 12 THE KATRIEL LAW FIRM ROY A. KATRIEL 1101 30th Street, N.W., Suite 500 Washington, DC 20007 Telephone: 202/625-4342 202/330-5593 (fax) 13 14 15 16 Co-Lead Counsel for Plaintiffs 17 BONNETT, FAIRBOURN, FRIEDMAN & BALINT, P.C. ANDREW S. FRIEDMAN FRANCIS J. BALINT, JR. ELAINE A. RYAN TODD D. CARPENTER 2901 N. Central Avenue, Suite 1000 Phoenix, AZ 85012 Telephone: 602/274-1100 602/274-1199 (fax) 18 19 20 21 22 BRAUN LAW GROUP, P.C. MICHAEL D. BRAUN 10680 West Pico Blvd., Suite 280 Los Angeles, CA 90064 Telephone: 310/836-6000 310/836-6010 (fax) 23 24 25 26 27 28 627193_2 SUPPLEMENTAL BRIEF IN RESPONSE TO COURT’S MAY 19, 2011 ORDER - C-05-00037- JW(HRL) -4- 1 MURRAY, FRANK & SAILER LLP BRIAN P. MURRAY JACQUELINE SAILER 275 Madison Avenue, Suite 801 New York, NY 10016 Telephone: 212/682-1818 212/682-1892 (fax) 2 3 4 5 8 GLANCY BINKOW & GOLDBERG LLP MICHAEL GOLDBERG 1801 Avenue of the Stars, Suite 311 Los Angeles, CA 90067 Telephone: 310/201-9150 310/201-9160 (fax) 9 Additional Counsel for Plaintiffs 6 7 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 627193_2 SUPPLEMENTAL BRIEF IN RESPONSE TO COURT’S MAY 19, 2011 ORDER - C-05-00037- JW(HRL) -5- 1 2 CERTIFICATE OF SERVICE I hereby certify that on June 6, 2011, I authorized the electronic filing of the foregoing with 3 the Clerk of the Court using the CM/ECF system which will send notification of such filing to the 4 e-mail addresses denoted on the attached Electronic Mail Notice List, and I hereby certify that I 5 caused to be mailed the foregoing document or paper via the United States Postal Service to the non6 CM/ECF participants indicated on the attached Manual Notice List. 7 I certify under penalty of perjury under the laws of the United States of America that the 8 foregoing is true and correct. Executed on June 6, 2011. 9 s/ Bonny E. Sweeney BONNY E. SWEENEY 10 13 ROBBINS GELLER RUDMAN & DOWD LLP 655 West Broadway, Suite 1900 San Diego, CA 92101-3301 Telephone: 619/231-1058 619/231-7423 (fax) 14 E-mail: 11 12 15 16 17 18 19 20 21 22 23 24 25 26 27 28 627193_2 bonnys@rgrdlaw.com CAND-ECF- Page 1 of 2 Mailing Information for a Case 5:05-cv-00037-JW Electronic Mail Notice List The following are those who are currently on the list to receive e-mail notices for this case. Francis Joseph Balint , Jr fbalint@bffb.com Alexandra Senya Bernay xanb@rgrdlaw.com Michael D Braun service@braunlawgroup.com Michael D. Braun service@braunlawgroup.com,clc@braunlawgroup.com Todd David Carpenter tcarpenter@bffb.com,pjohnson@bffb.com,rcreech@bffb.com Andrew S. Friedman khonecker@bffb.com,rcreech@bffb.com,afriedman@bffb.com Alreen Haeggquist alreenh@zhlaw.com,judyj@zhlaw.com,winkyc@zhlaw.com Roy Arie Katriel rak@katriellaw.com,rk618@aol.com Thomas J. Kennedy tkennedy@murrayfrank.com David Craig Kiernan dkiernan@jonesday.com,lwong@jonesday.com Carmen Anthony Medici cmedici@rgrdlaw.com,slandry@rgrdlaw.com Thomas Robert Merrick tmerrick@rgrdlaw.com,e_file_sd@rgrdlaw.com,e_file_sf@rgrdlaw.com Caroline Nason Mitchell cnmitchell@jonesday.com,mlandsborough@jonesday.com,ewallace@jonesday.com Robert Allan Mittelstaedt ramittelstaedt@jonesday.com,mlandsborough@jonesday.com Brian P Murray bmurray@murrayfrank.com George A. Riley griley@omm.com,lperez@omm.com,cchiu@omm.com Elaine A. Ryan https://ecf.cand.uscourts.gov/cgi-bin/MailList.pl?658089505863393-L_366_0-1 6/6/2011 CAND-ECF- Page 2 of 2 eryan@bffb.com,nserden@bffb.com Jacqueline Sailer jsailer@murrayfrank.com Michael Tedder Scott michaelscott@jonesday.com,amhoward@jonesday.com Craig Ellsworth Stewart cestewart@jonesday.com,mlandsborough@jonesday.com John J. Stoia , Jr jstoia@rgrdlaw.com Bonny E. Sweeney bonnys@rgrdlaw.com,christinas@rgrdlaw.com,E_file_sd@rgrdlaw.com Helen I. Zeldes helenz@zhlaw.com Manual Notice List The following is the list of attorneys who are not on the list to receive e-mail notices for this case (who therefore require manual noticing). You may wish to use your mouse to select and copy this list into your word processing program in order to create notices or labels for these recipients. (No manual recipients) https://ecf.cand.uscourts.gov/cgi-bin/MailList.pl?658089505863393-L_366_0-1 6/6/2011