746 F.3d 842
7th Cir.2014Background
- Motorola sues foreign LCD panel manufacturers under Sherman Act §1 for alleged price fixing.
- About 99% of panels were bought by Motorola's foreign subsidiaries, not Motorola itself.
- 42% of panels were bought abroad and incorporated into products shipped to the US; 57% were sold abroad and did not enter the US market.
- The district court held that the 42% (plus 57% barred by FTIA) cannot support a Sherman Act claim.
- The district court certified an interlocutory appeal under 28 U.S.C. § 1292(b); the Seventh Circuit granted leave and the appeal proceeded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FTIA § 6a(1)(A) applies to foreign conduct with indirect US effects | Motorola argues the foreign price fixing directly affects US commerce | Defendants contend effects are indirect/remote and not actionable in US law | Direct-effect requirement not met; FTIA bars Sherman Act claim |
| Whether the alleged price fixing had a direct, substantial, and reasonably foreseeable effect on US commerce | Motorola asserts a direct impact via components used in US-imported devices | Effects are mediated through foreign subsidiaries and are not direct to US commerce | Effect not direct; falls outside Sherman Act liability |
| Whether the effect on US commerce must give rise to a Sherman Act claim | Any effect on US commerce from foreign price fixing could support liability | The effect must give rise to a US antitrust claim; otherwise FTIA bars relief | No antitrust claim arises from foreign subsidiaries’ injury; liability cannot attach |
| Whether interlocutory appeal under 1292(b) was appropriate to resolve controlling legal questions | Interlocutory review would advance termination of the case | Same issues would not be merit-worthy for immediate appeal | Interlocutory appeal proper and appropriate |
Key Cases Cited
- Minn-Chem, Inc. v. Agrium, Inc., 683 F.3d 845 (7th Cir. 2012) (directness requirement and foreign-trade considerations)
- F. Hoffmann-La Roche Ltd. v. Empagran S.A., 542 U.S. 155 (S. Ct. 2004) (extraterritorial reach and FTIA purpose)
- Disenos Artisticos E Industriales, S.A. v. Costco Wholesale Corp., 97 F.3d 377 (9th Cir. 1996) (corporate separateness and boundaries of antitrust claims)
- United Phosphorus, Ltd. v. Angus Chemical Co., 322 F.3d 942 (7th Cir. 2003) (en banc discussion on extraterritoriality and antitrust scope)