Corporate & Securities Law

The Ninth Circuit Affirms Dismissal of Foreigners’ Claim Against DRAM Manufacturers for Price Fixing

By Matthew S. Wild

The Ninth Circuit affirmed dismissal of foreigner purchasers’ Section 1 claims against DRAM manufacturers for price-fixing.  In re Dynamic Random Access Memory (DRAM) Antitrust Litig., No. 06-15636, 2008 WL 3522419 (9th Cir. Aug. 14, 2008).  The plaintiffs alleged that they purchased DRAM abroad at supra-competitive prices due to defendants’ price fixing activities.  The only link between the effect on U.S. commerce and plaintiffs’ injuries was that in order for the cartel to be successful, defendants had to fix prices in the U.S. and abroad.  Constitent with the many courts that have visited this issue since the Supreme Court’s decision in F. Hoffman-La Roche Ltd. v. Empagran S.A., 542 U.S. 155 (2004), the Ninth Circuit held that such allegations were insufficient to bring plaintiffs’ claims within the “domestic injury” exception to the Foreign Trade Antitrust Improvement Act.  That statute excludes “conduct that causes only foreign injury” from the reach of the U.S. antitrust laws.  Id. at 158.  Judge Noonan’s concurring opinion is particularly interesting as he has explains that the decision is nothing more than a policy choice by “Congress and the Supreme Court that the economic interests of consumers outside the United States are normally not something American law is intended to protect.”  As Judge Noonan observes, “[w]e reach this vanishing point not from guidance in words like ‘proximate’ or ‘direct’ but from a strong sense that the protection of consumers in another country is normally the business of that country.  Location, not logic, keeps [plaintiff’s] claim out of court.”

Full post as published by Antitrust Commentary on September 18, 2008 (boomark / email).