Toys ‘R’ Us $35 Million Antitrust Accord Overturned

Bloomberg Business discusses the Center for Class Action Fairness' case In Re Baby Products Antitrust Litigation.

Toys “R” Us Inc.’s $35 million settlement of an antitrust group lawsuit over inflated prices was thrown out by an appeals court that questioned the distribution of the funds and rejected the fees awarded lawyers.

“The settlement has resulted in a troubling, and, according to counsel for the parties, surprising allocation of the settlement fund,” the judges said. “Though the parties contemplated that excess funds would be distributed to charity after the bulk of the settlement fund was distributed to class members through an exhaustive claims process, it appears the actual allocation will be just the opposite.”

The settlement stems from antitrust lawsuits filed in 2005 and 2006 by consumers and Internet retailers, including Inc., claiming that Babies “R” Us conspired with baby-product manufacturers to limit discount pricing on certain items. The retailers claimed Toys “R” Us threatened to cut off supplies if they charged less than agreed upon minimum prices. Consumers said the company’s actions caused them to pay inflated prices.