• Standing Requirements in Indirect Purchaser Antitrust Cases Discussed
  • March 24, 2015
  • Law Firm: Lieff Cabraser Heimann Bernstein LLP - San Francisco Office
  • In the latest issue of Business Torts & RICO News, a publication of the Business Torts & Civil RICO Committee of the American Bar Association Section of Antitrust Law, Lieff Cabraser attorney Lin Y. Chan addresses of the question of antitrust standing requirements in the context of state Illinois Brick repealer statutes.

    In Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977), the U.S. Supreme Court held that indirect purchasers -- those who do not buy directly from the conspirators engaged in price-fixing -- could not recover monetary damages under federal antitrust laws. In response to Illinois Brick, a number of states enacted Illinois Brick repealer statutes that expressly permit actions brought by consumers and other indirect purchasers under state antitrust laws.

    Nevertheless, defendants in antitrust actions routinely challenge the standing of indirect purchaser plaintiffs filed under state "Illinois Brick repealer" statutes on the ground that indirect purchasers lack standing under Associated General Contractors of California v. California State Council of Carpenters, 459 U.S. 519 (1983) ("AGC"). In AGC, the Court held that in addition to Article III standing, antitrust plaintiffs must also satisfy certain statutory standing requirements in order to recover damages under the Clayton Act.

    Courts have come to differing conclusions on how to address this issue, with states often placed in three groups: (1) states in which a statute or state court has explicitly adopted AGC standing requirements; (2) states that have so-called federal "harmonization" provisions; and (3) states that do not apply AGC or that have not addressed this issue.

    In her commentary, Chan advocates for a more nuanced approach to ACG standing under state law:

    "Although states may be grouped into states with courts that apply AGC without significant modification and states that have passed "harmonization" statutes that harmonize state antitrust law with federal jurisprudence, within each group, more nuanced state-by-state analysis is called for as to the legislative background of Illinois Brick repealer statutes, each state's analysis of antitrust standing, developments following such analysis, the type of harmonization provision at issue, and how such harmonization provisions have been applied."