Japanese Consumers Lose Suit Against Oil Companies, But Set Important Precedent

Consumers rarely take legal action against companies in Japan, but this may be changing as a result of three cases concluded in the past six months.

In each of the lawsuits, which date back to the worldwide oil price hikes in 1973-74, groups of consumers alleged that the six major oil refining-distributing companies in Japan-including Nippon Oil, Mitsubishi Oil, and Daikyo Oil-engaged in a price cartel which raised the cost of oil.

Consumers in two of the cases succeeded in convincing the courts that the oil companies were guilty of forming a cartel. However, the judges refused to award the plaintiffs damages, ruling that price increases could have been caused by OPEC rather than the cartel. "The plaintiffs didn't prove that antitrust monopolistic action was the cause of the price rise which actually occurred," explained Akinori Uesugi, first secretary of the Japanese embassy in Washington.

One of the consumer groups, comprised of 98 women in the Japanese Housewives' Federation, is appealing the decision. A final ruling is not expected for at least a year.

The other case, brought by 343 Tokyo consumers, was settled out of court in early July, with the companies agreeing to pay legal fees in part and to donate money to a legal assistance organization.

These cases are "very symbolic," said Uesugi. As a result of the litigation, "the court clearly acknowledges the standing of consumer groups to sue."