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Recovery in the U.S. for Price Fixing Abroad: The Future of FTAIA Litigation

Alicia Batts, Keith Butler, Nov 16, 2011

As global economic trade has increased, so has the number of price-fixing plaintiffs who have sought recovery in U.S. courts under U.S. antitrust laws for damages suffered as a result of cartel activity abroad. Historically, plaintiffs suing in U.S. courts under U.S. laws have had a difficult time getting beyond the pleadings stage in cases targeting foreign price-fixing. But that may be changing.

Recent cases interpreting the Foreign Trade Antitrust Improvements Act ("FTAIA"), the statute that governs the extraterritorial application of U.S. antitrust laws, may have lowered the bar for plaintiffs seeking recovery under the Sherman Act for anticompetitive behavior that occurs overseas but affects the U.S. economy. These cases have criticized the prevailing view that the FTAIA enhances the burden borne by plaintiffs to establish federal court jurisdiction in cases involving overseas conduct, and have favored, instead, the view that the statute merely adds an element to an antitrust cause of action, one that defendants must rebut to prevail on a motion to dismiss.

Under this new rule, defendants may find it more difficult to win early dismissal, and avoid expensive discovery, in antitrust cases involving foreign conduct affecting U.S. commerce. Because there is now a circuit split on the issue, it is ripe for Supreme Court attention. Given the increase, and increasing significance, of global trade, this is an invitation the Court should accept.

Recent cases have also refined the scope of the FTAIA and its application to indirect purchaser claims under state law. The emerging view suggests that U.S. courts are actively policing overseas conduct whose impact is felt on U.S. shores.

 

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