(Reuters) - There’s absolutely no doubt that the hottest securities class action of the moment is the shareholder fraud case against Tesla over Elon Musk’s infamous $20 million tweet, in which investors have until Tuesday at midnight to file a claim to lead the case. There will undoubtedly be no shortage of candidates, given that plaintiffs’ lawyers have been publicly asserting billion-dollar exposure for Tesla.
But that’s not the only looming lead counsel fight for big names in the plaintiffs’ bar. Last week, the Judicial Panel on Multidistrict Litigation ordered the consolidation of at least nine (and as many as 15) prospective antitrust class actions alleging that companies in control of local television stations – notably, Sinclair Broadcast Group, Tribune Media and Hearst Television, among others – have conspired to rig ad sale rates in markets across the country. The multidistrict litigation is now before U.S. District Judge Virginia Kendall of Chicago.
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The alleged conspiracy, as the JPML described it in the consolidation order, has been underway since at least 2016 and possibly since 2014. According to the complaints, defendants shared information about ad rates through their ad sales teams and via trade associations in order to peg prices at supracompetitive rates. Last July, the Wall Street Journal reported that the Justice Department conducted an antitrust investigation of local television ad sales following its rejection of a merger between Tribune and Sinclair.
The defendants are taking litigation seriously enough to have engaged an expensive array of big firms to represent them: Shearman & Sterling for Sinclair, Paul Weiss Rifkind Wharton & Garrison for Tribune, Cravath Swaine & Moore for Hearst, Kirkland & Ellis for Nexstar Media, Jenner & Block for TEGNA and Cooley for Gray Television.
The plaintiffs, meanwhile, are for the most part small businesses like personal injury law firms, car dealerships and an ad agency. On Friday, after the MDL was established, the national department store Bon-Ton filed a complaint in federal court in Chicago that will be part of the case. According to Bon-Ton lawyer Adam Levitt of DiCello Levitt & Casey (who’s co-counseling with Labaton Sucharow), the store chain is by far the largest business, with the largest advertising expenditures, to enter the litigation so far.
But plenty of other antitrust plaintiffs’ lawyers are also representing clients in the consolidated case, including Hausfeld, Robins Kaplan, Hagens Berman Sobol Shapiro, Kessler Topaz Meltzer & Check, Lowey Dannenberg, Wexler Wallace, Scott & Scott, Kaplan Fox & Kilsheimer and Joseph Saveri Law Firm.
Judge Kendall, in other words, will have no shortage of candidates when she picks the lawyers who will lead the case. There are no statutory guidelines for picking antitrust lead plaintiffs or lawyers, unlike in securities class actions, but judges often look at the magnitude of potential damages to weigh how big a stake a potential lead plaintiff has in the outcome of the case. Judge Kendall has not yet set out a briefing schedule in the television ad sales MDL but you can be sure a lot of plaintiffs’ lawyers will be looking out for the filing.