Price-Fixing Conspiracy Revealed: Caustic Soda Class Action Lawsuit Launched

Sodium hydroxide, also known as lye or caustic soda, has allegedly been overpriced in Canada for years! Although you may not be familiar with this chemical, it is used for making soaps, detergents, artificial textile fibres (such as Rayon), paper, dyes and more. This means that you likely purchased products containing caustic soda at an inflated price.

The caustic soda price-fixing scheme has recently been exposed, leading to over a dozen corporations being hit with a proposed class action lawsuit Canada. The defendants allegedly secretly entered into illegal agreements to fix, maintain, increase or control the sale price of caustic soda in North America, including Canada.

If you are a resident of Canada who purchased caustic soda and/or products containing caustic soda between Oct. 1, 2015 and the date of authorization of this class action, or a date determined by the court, you are a potential Class Member of the caustic soda price-fixing class action.

Caustic Soda Price-Fixing Scheme Exposed

The caustic soda price-fixing class action lawsuit claims that as a result of the defendants’ illegal behaviour many Canadians suffered damages by paying “artificially inflated prices for caustic soda sold and/or distributed by the defendants and for products containing caustic soda.”

This is not the first class action lawsuit to be waged against illegal caustic soda price-fixing. In 2019, a U.S. class action was launched against several chemical corporations, accused of illicitly colluding in order to drive up the market price of caustic soda.

The Canadian caustic soda price-fixing class action lawsuit describes the caustic soda industry as “characterised by high financial and other barriers to entry.”

As a result, these barriers make it unlikely that new competitors will enter the caustic soda market, thereby reducing the prices set by the defendants’ cartel.

According to the caustic soda price-fixing class action, these barriers coupled with the defendants’ significant market shares allowed for the price-fixing conspiracy to successfully take place.

The Cartel Revealed

Since October 2015, the defendants have participated in a conspiracy to fix, maintain, increase or control the price of caustic soda and have effectively fixed, maintained, controlled, reduced or eliminated the production and supply of caustic soda sold in North America, including Canada and Quebec, alleges the complaint.

The caustic soda price-fixing class action lawsuit continues that prior to October 2015, “caustic soda prices were stable or declining. However, beginning in the fourth quarter of 2015, the defendants repeatedly announced substantial price increases for caustic soda, even though market conditions had remained largely unchanged.”

Indeed, the demand for caustic soda remained more or less the same, as did energy costs, which rose only slightly. In addition, the caustic soda market was, and still is, in overproduction, according to the class action lawsuit Canada.

In 2015, the defendants allegedly began to tighten the supply of caustic soda on the market by reducing production, temporarily closing plants under the pretext of maintenance and rationing some of their customers in a coordinated manner.

This reportedly allowed the caustic soda corporations to justify price increases and misrepresent to buyers that the supply of caustic soda was limited.

In addition, the defendants increased the price of caustic soda in similar proportions and at similar times, without always publicly disclosing these price increases.

The caustic soda price-fixing class action lawsuit maintains that the caustic soda industry is run by several large trade organizations which hold meetings several times a year. These meetings reportedly “facilitated collusion” and realized the “implementation of the conspiracy.”

Caustic Soda Conspiracy Breaches Anti-Competition Laws

According to the caustic soda price-fixing class action lawsuit, the defendants knew that their actions would likely cause prejudice to the plaintiff and Class Members. The damage claimed: The defendants harmed the financial interests of Class Members and deprived them of the benefit of competition. As a result, Class Members overpaid for caustic soda and products containing caustic soda.

The caustic soda price-fixing class action lawsuit is seeking compensation for all damages suffered in an amount to be determined by the court, as well as punitive and/or exemplary damages in an amount to be determined by the court. Finally, the plaintiff’s lawyers are seeking an order requiring the defendants to pay the costs incurred for any investigation necessary to establish their liability in the class action proceeding, including extra-judicial lawyers’ fees and extra-judicial disbursements.

Have you purchased products containing caustic soda? Do you want to join this class action lawsuit? Tell us what you think in comment section below!

The plaintiff and potential Class Members are represented by Siskinds, Desmeules, Avocats, s.e.n.c.r.l.

The Caustic Soda Price-Fixing Class Action Lawsuit is Florence Moreault v. Olin Corporation, et al., Case No. 200-06-000252-208, in the Superior Court of Québec, District of Québec, Canada.

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