HomeMy WebLinkAboutCC Res 1570 1967-07-17
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RESOLtrrION NO. /570
A RESOLtrrION OF THE CITY COUNCIL OF THE CITY OF
SEAL BEACH DIRECTING, AtrrHORIZING, AND EMPOWERING
LEGAL COUNSEL TO FILE DISMISSALS IN WEST COAST
PIPE CASES.
The City Council of the City of Seal Beach does hereby resolve:
Section 1. The City of Seal Beach (hereinafter referred to as
"this entity") is a plaintiff in one or more antitrust damage actions
generally described as the West Coast Pipe Cases.
Section 2. On May 5, 1967, a written "Memorandum of Understanding
for Settlement of West Coast Pipe Cases Between All Plaintiffs and
Certain Defendants" was entered into by counsel for plaintiffs in
said cases and counsel for defendants United States Steel Corporation,
Kaiser Steel Corporation, Martin-Marietta corporation, U. S.
Industries, Inc., United Concrete Pipe Corporation and Smith-Scott
Co., Inc., hereinafter collectively referred to as "Settling Defendants,"
a copy of said Memorandum of Understanding being on file in the office
of this entity.
Section 3. Said Memorandum of Understanding provides for payment to
the designated Agent for all plaintiffs of the sum of $21,275,000, of
which sum $18,587,500 is to be paid in cash on the closing of the
settlement and $2,687,500 is to be represented by installment promis-
sory notes of U. S. Industries, Inc., and United Concrete Pipe
Corporation.
Section 4. Trust Department, Bank of America, Nt & SA,
300 Montgomery Street, San Francisco, California 94102, has been
designated by plaintiffs as their Agent under said Memorandum of
Understanding.
Section 5. In order to consummate the compromise and settlement
provided for in said Memorandum of Understanding it is necessary that
each plaintiff (1) ratify, affirm and approve said Memorandum of
Understanding and the compromise and settlement provided for thereby,
(11) authorize the payment and delivery by Settling Defendants to
plaintiffs' Agent of the net settlement amount on a lump sum basis,
without responsibility on the part of Settling Defendants for the
allocation or distribution of such settlement amount as among the
plaintiffs, and (111) authorize the execution and delivery of a
Covenant Not to Sue, dismissals of the pending actions, and such
other writings and the taking of such other action as is required
in order to effectuate said compromise and settlement.
Section 6. Acceptance of the compromise and settlement provided for
in said Memorandum of Understanding is in the best interests of this
entity.
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Resolution Number
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SEAL BEACH AS FOLLOWS:
Said Memorandum of Understanding for Settlement of West Coast Pipe
Cases Between All Plaintiffs and Certain Defendants dated May 5, 1967,
and the compromise and settlement provided for thereby, are hereby
ratified, affirmed and approved.
The designation of Trust Department, Bank of America, NT & SA,
300 Montgomery Street, San Francisco, California 94102, as Agent
for all plaintiffs is hereby ratified, affirmed and approved.
Payment and delivery by the Settling Defendants to plaintiffs' Agent
of the settlement amount of $21,275,000 represented by the cash amount
and the notes hereinabove referred to, without responsibility on the
part of Settling Defendants for the allocation or distribution of said
settlement amount as among plaintiffs, are hereby authorized and
approved.
The City Manager and the City Clerk of the City of Seal Beach are
hereby directed, authorized and empowered to execute and deliver, on
behalf of this entity, as its act and deed, and under its seal, a
Covenant Not to Sue in the form attached hereto as Exhibit A.
Counsel of record in said damage actions for this entity are hereby
directed, authorized and empowered, on its behalf and as its act and
deed, to execute, deliver and file dismissals in such form as may be
agreed to pursuant to said Memorandum of Understanding, to execute
and deliver such other writings, and to take any and all other action
which may be required of this entity in order to effectuate and
consummate the compromise and settlement provided for in said
Memorandum of Understanding.
I, F. W. Hickman, hereby certify that I am the duly elected, qualified,
and acting City Clerk of the City of Seal Beach and that the attached
and foregoing is a full true and correct copy of a resolution duly and
regularly adopted by the City Council of the City of Seal Beach at a
meeting thereof held on the /7l!1-- day of ~ ' 1967, by the
following vote: II
AYES: Councilmen ~~..n~ ~~li;v,Ou~. f4..de~
NOES: Councilmen '1-t4'/. ~
ABSENT: Councilmen '7,..,r7'I..Jl- ./'
ATTEST:
~./.#4'.,'l~~
City Clerk
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Resolution Number
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MEMORANDlW OF UNDERSTANDING FOR SETTLill~ENT
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OF WEST COAST PIPE CASES BE~IEEN ALL PLAINTIFFS
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AND CERTAIN DEFEh~ANTS
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Parties
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The parti.es to this understanding are all of the
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plai.ntiffs (including all intervenors and other claimants)
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in the so-called "End User" pipe cases and defendants
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United Concrete Pipe Corporation, Smith-Scott Co., Inc.,
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Kaiser Steel. Corporation, Martin-Marietta Corporation,
U. S. Industries,'Inc., and United states Steel Corpor.ation,
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referred to herein as settling defendants (including all
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subsidiaries, parents, and all past and present officers
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and employees of each such defendant).
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Amount ~ro Be Paid
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The settling defendants shall pay to such agent
for all plaintiffs as may be designated the sum of ~enty
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One Million Two Hundred Seventy Five Thousand Dollars
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22 (~2l,275,000). Of said amount, plaintiffs have advised
23 settling defendants that the sum of $200,000.00 represents
24 certain out-of-pocket expenses advanced by certain plaintiffs.
25 From the remainder of $21,075,000.00 there shall be set
26 aside an amount a~located by plaintiffs to the United
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States Government in settlement of its claims, which shall
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be subject to a'separate but similar agreement between the
29 government and settling defend~~ts. Plaintiffs' chairman
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shall give settling defendants' chairman wr:ctten notice of
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the a'llount :>0 allocated within thirty (30) ciays from date
32 of execution of this memorandlliu. Of said sum of
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11.3-6:i--'J5Y-5S3
Resolution Number
~2l,275,000oOO, $2,687,500.00 shall be represented by
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~nstallment prom~nsory notes executed by defendants U. S.
Industries, Inc. and united Concrete Pipe Corporation, such
notes to contain the terms and be in the form of the note
attO'.ched hereto as Exhibit A. The notes of United Concrete
(or equivalent)
Pipe Corporation shall be guaranteed/by a bank of reputahle
standing in its corrnnunity.
For the forego~ng purpose and for the further purpose
of assisting plaintiffs in the allocation and distribution
of.settlement proceeds, each settling defendant shall .com-
plete so far as practicable the verification of transactions
-heretofore identified by plaintiffs for verification by __
such defendant.
It is understood that neither the settlement hel:ein
referred to nor the consideration to be paid therefor is
predicated upon any sales of the products or services herein
referred to made to plaintiffs, or any of them, directly
or indire~tly, by defendants American Pipe & Construction Co.,
pipe Linings, Inc., Armco Steel Corporation, the Southwest
Welding entities, or any of their subsidiaries or affiliates.
It is further expressly agreed, subject to the next
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succeeding paragraph, that plaintiffs, and each of them,
reserve and maintain, and that neither such settla'llent, nor
the consideration therefor shall in any \~ay or to any extent
. relate to, limit, waive or otherwise' affect in any manner
or degree, any right or rights which plaintiffs, or any of
them, may have against defendants American Pipe & Con-
struction Co., Pipe Linings, Inc., Armco Steel Corporation,
and the Southwest Welding entiti~s, or any of their sub-
sidiaries, affiliates, officers or employees.
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,.u 5.'XOS't(I~I_
11-3-65-'1'5'-[-558
Resolution Number
Dismissals and Covenants
Each plaintiff in each of said _:"p'ilcCling actions \.,ill
dismiss without prejudice and without costs said actions
against all settling defendants.
Plaintiffs will execute covenants, in the form
attached hereto as Exhibit B, (1) not to sue, and not to
sue further,.any settling defendant on any claims asserted
..ny_plaintiffs, or any of them, against settling defendants,
or any o~ them, and (2) not to sue, and not to sue further,
any other defendant or alleged co-conspirator on any claima
attributable to any settling defendant's sales, direct or
indirect, of the products or services referred to in
Exhibit B.
Each plaintiff will also covenant not to execute or
attempt to execute against settling defendants, or any of
them, on any judgment or judgments which may be obtained by
plaintiffs, or any of th~u, in said actions.
ConstU1lIlIation of Settlement
The settlement herein referred to resulted from
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discussions between counsel for plaintiffs and settling
defendants in proceedings before Honorable Hartin Pence
initiated on January 18, 1967, and concluded on May 5, 1957.
Counsel for the part~es hereto each agree to recom~end, in
good faith, without qualification, and with full measure of
support, the settlement set forth herein to their respective
client or clients, it being understood that ratification
by such clients is necessary.
It is tne intent of all coupsel that such settlement
be consunuuated at the earliest possible date at a further
proceeding before Judge Pence. In consideration of the .
payment of the settlement amount (including the notes above
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Resolution Number
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1 referred to), plainti=fs ~ha]l deliver to settling defendants
2" duly executed dismisc"lf; ar.d covenants as above provided,
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togei.-.her ",ith duly ar10pted aIlrl certified resolutions or
equivalent .document:; ratiI.:ring and confinning this settlement
and the execution ()f s'lch disl,lissals and covenants and the
6' _payment of the sel:t:lcffie-:it.. fund (including delivery of said
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"1 --:... - notes) to the agent above na.ued, without responsibility of. .
S-.: .. settlillg defenc1antl'l for :the allocation or distribution
9 thereof. The documents referred to shall be in such form
10 as l'lhall be agreed to bebmen the chairmen of plaintiffs"
11 and defendants' counsel.
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Execution of this MemorandtIDl
This.memorandQ~-may be executed in any number of
counterparts "lith like effect as if all signatures were on
the original.
17 DATED: May 5, 1967.
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11.3-65-'jS~!-5Sa
~F R THE PLAINTIF~S~
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Resolution N~er
PROIUSSOny NO~'E
, 1967
In installments as herein stated, for value received,
,
,
,
corporation, promises
, a
t.o pay to
, or
order, at San I:'rancisco, California, the sum of
(~
) Dollars, \'1ith
in.terest from date hereof on unpai(1 principal at the rate of
five ~5) per cent per annmu, payable annually with principal.
installment; principal 'payable in installments as follmvs:
Should interest not be so paid it shall ther(;after bear like
interest as tIle principal, but such unpaid interest so com-
pounded shall not exceed an amount e Iual to simplE' in'cerest on
the unpaid principal a.t the maxhlum ~'ate permi.tted by law.
Should defaul'c be made in payment of any installm~nt of
principal or int.erest \'Ihen due the \'Ihole sum of princil'al and
.
interest shall become immediately due at the option of the
holder of this note. Principal and interest payable in la\'1ful
money of the United states. If action be instituted on this
note, the ma]{er hereof promises to pay SUdl sum as the Court
may fix as attorney's fees. This note Inay be prepaid in whole
or in pa~'i: at any time \'lithout penalty.
By
By
EXHI;-;IT A
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Resolution NUmber
Name of Customer THE crT'" OF SRAT. REACH
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COVENANT NOT TO SUE
WITNESSETH, that for and in consideration of the
payment by united Concrete pipe Corporation, Smith-Scott Co.,
Inc., Kaiser Steel Corporation, Martin-Marietta COI"poration,
u. S. Industries, Inc. and united states Steel Corporation,
on behalf of them and of all of their subsidiaries, parents
or affiliated companies, all successors and assigns, all
predecessor corporations, whether by merger, consolidation or
otherwise, and all of their past, present or future officers,
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directors, agents and employees, all of such persons herein-
above referred to being beneficiaries hereof (hereinafter
jointly and severally referred to as "Suppliers") of the sum
of One Dollar and other valuable consideration to the under-
signed (hereinafter referred to as "customer"), the receipt
of which is hereby acknowledged, Customer hereby covenants
and agrees that it will forever refrain from instituting,
prosecuting, maintaining, pressing, collecting or proceeding
against Suppliers upon any claims, controversies, actions,
causes of action, obligations or liabilities of any nature
whatsoever, whether or not now known, suspected or claimed
which Customer ever had, now has or hereafter can, shall or
may have or is alleged to have against Suppliers asserted
under the Clayton Act (15 U.S.C. SS 15, l5a and 26) or under
any other state or federal antitrust law, or based upon alle-
gations of fraud, collusion, conspiracy or false claims, per-
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taining to purchases made or contracted for, directly or
indirectly, by customer, or services rendered to Customer,
prior to May 5, 1967 of any "pipe products and pipe services"
as hereinafter defined.
"Pipe products and pipe services" as used herein
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Resolution Number
shall mean all those types and kinds of pipe and pipe services
which are defined in the complaints of the state of california
as amended (Civil Nos. 43403 ~hrough 43407), in the United
states District Court for the Northern District of california,
and such other and different types of pipe and pipe services
as (1) may have been designated as a basis for a claim by or
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on behalf of Customer in its response to Suppliers' transac-
tion interrogatories and which designation was not withdrawn
with consent of Suppliers or approval of the Court, or (2) was
claimed by or on behalf of Customer for verification by suppliers.
Without limiting the generality of the foregoing definition,
"pipe services" shall include coating, lining, processing and
rehabilitation of pipe products or any of such activities.
Customer hereby expressly reserves all of its rights
to sue and otherwise to proceed in any manner against any per-
son, firm or corporation, other than suppliers, with respect
to claims and causes of action arising out of the acquisition
by Customer of pipe products and pipe services made or con-
tracted for at any time prior to May 5, 1967, provided that
in exercising any rights of Customer, Customer covenants and
agrees that it will not seek or recover from any person, firm
or corporation any damages or other compensation of the type
or character hereinbefore referred to, resulting from, or
claimed to have resulted from any acquisition, direct or indirect,
by Customer of any pipe products or pipe services manufactured,
sold or rendered by Suppliers.
It is expressly understood and agreed that this in-
strument is not and shall not be construed as a release of
Suppliers or of anyone else as to any claim or cause of actionl
that the consideration paid by Suppliers does not represent and
shall not be construed as compensation for any damages claimed
to have been suffered by Customer with respect to purchases or
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Resolution Number
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contracts for the purchase of the aforesaid pipe products and
pipe services, which claims have been denied by Suppliers. The
consideration paid by Suppliers has been paid and accepted by
Customer solely as a partial adjustment of the aggregate pur-
chase price paid by Customer for direct or indirect acquisitions
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by Customer of pipe products produced or sold or pipe services
performed by Suppliers. The aforesaid consideration is not a
measure of the amount of any damages that are or may be or might
be claimed by Customer, whether arising from sales of pipe or
performance of pipe services by Suppliers or others, or as a
result of acquisition of the same by Customer, and is not an
admission of liability to Customer for any such damages, which
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liability is denied by Suppliers. It is also expressly under-
stood and agreed that the consideration paid to Customer is
predicated only upon sales of the aforesaid pipe products or
pipe services to Customer by Suppliers.
Nothing contained in this covenant is or shall be
construed as a limitation on the right of Customer to introduce
into evidence at the trial of any action pending against any
person, firm or corporation other than Suppliers any matter or
fact relevant in said action, provided only that Customer shall
not seek any damages in said action on account of its purchase,
directly or indirectly, of pipe products produced or sold, or
pipe services performed by, Suppliers.
IN WITNESS WHEREOF,
to be executed this I?! day
Customer has caused this covenant
of K ,1967.
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(Official seal)
A i-19fd P$e. G~
~Of Customer
By I~. a~.
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ATTEST:
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Resolution
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.July 18, 1967
I
Thomas C. Lynch, Attorney General
State of California Department of .Justice
The State Building
San Francisco, California 94102
Attention: Wallace Howland, Assistant Attorney General
Subj:
Settlement of Western Pipe Cases, Et Cetra.
Enclosed herewith are two certified copies of Resolution
Number 1570 entitled "A Reso1ut~on of the City Council of
the City of. Seal Beach Directing, Authorizing, and Em-
powering Legal Counsel to File Dismissals in West Coast Pipe
Cases" and Resolution No. 15-71 entitled "A Resolution of the
City of Seal Beach Approving and Ratifying Memorandum of
Understanding Among Counsel for Plaintiffs in Western Pipe
Cases -- Re Distribution of Settlement Funds Among Plaintiffs."
Both resolutions were unanimously approved by the City Council
at thei~_regu1ar meeting of .Ju1y.I], 1967.
Very truly yours,
THE CITY OF SEAL BEACH
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.Lee Risner
City Manager
LR:fh
cc: .James R. Carnes, City Attorney
!) .1111y~r - ~TA:'o:LI:Y G. ANDEIlSON
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