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Commitments and Contingencies
 9 Months Ended
Sep. 30, 2014
Commitments and Contingencies.  
Commitments and Contingencies

9.  Commitments and Contingencies

 

Environmental Contingencies

 

We are currently involved with certain environmental remediation projects related to activities at former manufacturing operations of our wholly owned subsidiary Earle M. Jorgensen Company (“EMJ”) that were sold many years prior to our acquisition of EMJ in 2006. Although the potential cleanup costs could be significant, EMJ had insurance policies in place at the time they owned the manufacturing operations that are expected to cover the majority of the related costs. We do not expect that these obligations will have a material adverse impact on our financial position, results of operations or cash flows.

 

Legal Matters

 

On April 29, 2014, a judgment was entered against the Company and its subsidiary, Chapel Steel Corp. (“Chapel”), along with four other co-defendants, in an antitrust lawsuit filed in the United States District Court for the Southern District of Texas. As previously disclosed, Reliance has been involved in this legal proceeding brought by two former employees who left Chapel to start their own business and claim that Reliance, Chapel and the co-defendants engaged in anticompetitive activities. The judgment, entered against all defendants jointly and severally, awarded the plaintiff $156.0 million in damages, representing a trebling under federal antitrust laws of the jury verdict of $52.0 million in damages. On May 27, 2014 the judgment was reduced to $153.5 million. On October 20, 2014, the Company and Chapel settled all claims against them relating to this matter for $23.0 million. We had previously recorded a $10.0 million charge for this matter, which represented the low end of our range of estimated potential loss. On October 22, 2014 the Plaintiff filed a Release of Judgment with the United States District Court for the Southern District of Texas releasing the Company and Chapel from any liability under the judgment and the Company and Chapel dismissed their appeal of the judgment by filing a Notice of Dismissal with the United States Court of Appeals for the Fifth Circuit.

 

From time to time, we are named as a defendant in legal actions. Generally, these actions arise out of our normal course of business. Except as disclosed above, we are not a party to any pending legal proceedings other than routine litigation incidental to the business. We expect that these other matters will be resolved without a material adverse effect on our results of operations or financial condition. We maintain liability insurance against certain risks arising out of our ordinary course of business.