Wanhua Chemical America has agreed to pay $7.75 million to settle claims that it participated in a conspiracy to inflate the prices of MDI and TDI in the US.
Direct purchasers of the polyurethane raw materials filed a motion with the US District Court for the Western District of Pennsylvania on 31 July seeking preliminary approval of the settlement.
The agreement provides for Wanhua Chemical America to pay $7.75 million into a non-reversionary settlement fund, including the costs of notifying members of the proposed settlement class and administering the fund.
The company will also provide cooperation to the purchasers as they continue their claims against the remaining defendants, Dow and Huntsman.
The parties reportedly reached an agreement in principle on 3 June and signed the full settlement agreement on 9 July. The settlement does not represent a judicial finding of liability and will not take effect unless it receives court approval.
The litigation was launched in 2018 by companies that had purchased methylene diphenyl diisocyanate and toluene diisocyanate directly from manufacturers.
The purchasers allege that suppliers conspired to restrict the availability of MDI and TDI through coordinated plant closures and production limitations, while introducing price increases in parallel. The defendants have denied the allegations.
MDI and TDI are principal raw materials for polyurethane products including flexible and rigid foams, elastomers, coatings, adhesives and sealants.
The Wanhua agreement is the third settlement reached in the litigation. BASF previously agreed to pay $3 million, while Covestro's US subsidiary, Covestro LLC, agreed a $7 million settlement.
The court granted preliminary approval to the BASF and Covestro settlements on 23 July. A hearing to consider final approval of those agreements is scheduled for 7 December.
Claims against Wanhua Chemical Group, the Chinese parent company, were dismissed earlier this year after the court concluded that it lacked personal jurisdiction over the company. That decision did not dismiss the claims against its US subsidiary, Wanhua Chemical America.
The litigation against Dow and Huntsman remains active.