Corporate & Securities Law

Connecticut Attorney General May Pursue Damages to the General Economy of the State

By Matthew S. Wild

The Connecticut Supreme Court recently held that the Connecticut Attorney General may pursue ?damages to its general economy caused by violations of the Connecticut Antitrust Act.?  State of Connecticut v. Marsh and Mclennan Companies, Inc., SC 17861 (Ct. Apr. 15, 2008).  In Marsh, the Connecticut Attorney General claimed that the bid rigging scheme orchestrated by Marsh — in which Marsh decided which insurance companies should win individual contracts and which should submit high bids — caused far reaching harm to the entire Connecticut general economy. Insurance companies that did not comply with Marsh?s demands would be cut-off from all of Marsh?s customers.  The Connecticut Attorney General argued that Connecticut was particularly vulnerable to Marsh?s scheme as Connecticut is home to many insurance companies.  While the Court recognized that its decision conflicted with Hawaii v. Standard Oil Co. of California, 405 U.S. 251 (1972) (holding that Clayton Act does not confer standing for general economic harm), the Court observed that the relevant language of the Connecticut Antitrust Act differed from the Clayton Act.  The Court noted that unlike the Clayton Act, the Connecticut Antitrust Act provides specifically that the attorney general may bring an action as parens patriae ?with respect to damages to the general economy of the state or any political subdivision thereof.?  The Court recognized that although the state may have difficulty proving those damages, it would be improper to grant a motion to dismiss the Complaint on that basis.  A copy of the opinion is attached.

Connecticut v. Marsh

Full post as published by Antitrust Commentary on April 14, 2008 (boomark / email).