Justice Department accuses Assa Abloy of violating antitrust agreement

The U.S. Department of Justice has accused Swedish lockmaker Assa Abloy of violating a settlement related to its $4.3 billion acquisition of Spectrum Brands’ hardware and home products business last year. According to Reuters, The charges filed Tuesday in Washington court allege that Assa Abloy failed to pay compensation to a court-appointed monitor overseeing the company’s compliance with the terms of the settlement.

Allegations of payment arrears

The Justice Department filing said Assa Abloy stopped making payments to the monitor, Melinda Coolidge of Hausfeld, in February. That action, the filing said, was a violation of a settlement agreement that sought to resolve antitrust claims. The original lawsuit filed by the Justice Department sought to block the acquisition on the grounds that it would lead to higher market prices.

Dispute over monitor role and fees

Settlement, The plea agreement, which came before U.S. District Judge Ana Reyes, did not include an admission by Assa Abloy of wrongdoing. But the terms required the company to fund monitoring to ensure compliance. Coolidge, a U.S. managing partner at Hausfeld, a large plaintiff firm, charges $920 an hour for her services. In an April letter to Assa Abloy, she dismissed the company’s objections to her fees as “meritless.”

In June, Assa Abloy formally objected to Coolidge’s fee, arguing that the costs could exceed $20 million during the monitoring period. The company asked the court to limit Coolidge’s scope, saying it exceeded its authority by proposing a five-year industry study of smart locks. The Justice Department says the study is a key part of its mandate.

The Justice Department has asked the court to issue an order requiring Assa Abloy to resume payments. A hearing in the case is scheduled for July 9 before Judge Reyes. Neither Assa Abloy nor Coolidge responded to requests for comment, and the Justice Department declined to comment on the ongoing case.

Assa Abloy, known for brands such as Yale, August and EMTEK, has acquired the Spectrum division, which includes the Baldwin and Kwikset brands. The case, United States v. Assa Abloy and Spectrum Brands, is pending in the United States District Court for the District of Columbia.

Source: Reuters