Dan OLIVER; Jeannie Oliver; Joe Solo; Bernard Gross; Susan Keelin; Walter Kvasnik; Kou Srimounghanch; Humberto Gonzalez; Samuel D. Leggett; Brian Albee; Mary Louise Fowler; Joe Shaw, On their own behalves and on behalf of all others similarly situated; Rhonda Shultz, Plaintiffs-Appellants, v. SD-3C LLC; Panasonic Corporation; Panasonic Corporation of North America; Toshiba Corporation; SanDisk Corporation, Defendants-Appellees.
No. 12-16421
United States Court of Appeals, Ninth Circuit
May 14, 2014
751 F.3d 1081
Argued and Submitted Dec. 5, 2013.
Finally, it is worth noting that granting an evidentiary hearing in these circumstances not only gives a petitioner a fair opportunity to develop the record on important issues, it also prevents undue delay which inevitably results from an appellate court remanding for a hearing that should have been granted in the first place. As a matter of justice and efficiency, a petitioner should be entitled to an evidentiary hearing when he or she presents a close case of equitable tolling, as is the case here. However, I fear the irreconcilability of the majority‘s opinion with the unanimous opinion in Forbess leaves the law of the Ninth Circuit with respect to equitable tolling unsettled and in conflict. The majority‘s decision today will place district judges in a quandary when assessing whether to grant or deny an evidentiary hearing on a claim of equitable tolling, particularly when the claim includes an allegation of mental illness.
In closing, the majority, denying any hearing or relief, would minimize Yeh‘s circumstances compared to those suffered by Forbess. The majority states, “Yeh‘s mental impairment and his allegations regarding that impairment come nowhere close to those in Forbess.” Supra Part II.B. But given the skeletal nature of the record, how can the majority reach such a conclusion? Such statement carries little relevance or weight when made by a non-medical person without the benefit of a developed record. As in Forbess, the district court and this court should decide the disposition of Yeh‘s claim only after the development of the record through an evidentiary hearing with appropriate findings of fact by the district court.
In closing, the pro se petitioner in this case alleges a lack of English proficiency, a history of severe mental impairment, and confinement in administrative segregation during the period in which he was required to file a federal habeas petition. If that person, Yeh, is not entitled to an evidentiary hearing on equitable tolling, then who is?
Christopher B. Hockett (argued), Davis Polk & Wardwell LLP, Menlo Park, CA, for Defendant-Appellee SD-3C, LLC; Jeffrey L. Kessler, Winston & Strawn LLP, New York, NY, for Defendants-Appellees Panasonic Corporation and Panasonic Corporation of North America; Richard S. Taffet, Bingham McCutchen LLP, New York, NY, for Defendant-Appellee SanDisk Corporation; and Daniel M. Wall, Latham & Watkins, San Francisco, CA, for Defendant-Appellee Toshiba Corporation.
Before: RONALD M. GOULD and RICHARD A. PAEZ, Circuit Judges, and DAVID A. EZRA, District Judge.*
OPINION
PAEZ, Circuit Judge:
In this antitrust suit, Plaintiffs, purchasers of SD digital memory cards, allege that Defendants Panasonic Corporation, Toshiba Corporation, SanDisk Corporation, and
Recently, in a related action, Samsung Electronics Co., Ltd. v. Panasonic Corp., 12-15185, 747 F.3d 1199, 2014 WL 1328318 (9th Cir. Apr. 4, 2014), we held that the district court erred in concluding that the
I
In giving factual context for the federal and state antitrust claims, Plaintiffs allege essentially the same facts regarding the development of SD cards as those alleged in Samsung. We therefore draw liberally from our Samsung opinion in setting the stage for Plaintiffs’ lawsuit and their challenge to the district court‘s dismissal order.
SD cards are the dominant form of flash memory card on the market, and are widely used in consumer electronics devices such as cellular phones and digital cameras. In 1999, Panasonic, Toshiba, and SanDisk developed SD cards as a modified proprietary format of the flash memory cards then available, created the SD Group to promote their use, and created SD-3C to license the format to manufacturers. In 2003, Defendants created a standard license (the “2003 license“) that contained a clause imposing a 6 percent royalty on SD cards sold by manufacturers who were not members of the SD Group.
In 2005 and 2006, Defendants developed two new forms of SD cards: the high capacity SD card (“SDHC“) which was the same physical size as the first-generation product, but used distinct software to give it a substantially higher storage capacity than the original; and the much smaller microSD card, designed for use in mobile phones. By its terms, the 2003 license did not cover these new formats. The SD group met in the fall of 2006 and adopted an “Amended and Restated SD Memory Card License Agreement” (the “2006 license“), which contained the same 6 percent royalty terms for non-SD Group manufacturers of the two new formats as the 2003 license had required for the original cards.
The 2006 license also included a “fair market price” provision pursuant to which Defendants were authorized to determine the “fair market price” of SD cards and to use that price as a baseline in calculating royalties. Plaintiffs allege that this provision shows that Defendants, who control 70 percent of the SD market, intended to “agree upon and charge a ‘fair market
Plaintiffs filed their lawsuit on March 15, 2011 and, of note here, they allege that they purchased SD cards on or after March 15, 2007. Plaintiffs’ first claim for relief seeks an injunction under
As in Samsung, the district court dismissed Plaintiffs’ claims on the ground that they were time-barred. The district court held that the four-year statute of limitations set forth in
II
Although a claim for injunctive relief under section 16 is “analogous” to a claim for damages under section 4, section 16 provides a distinct cause of action. Int‘l Tel. & Tel. Corp. v. Gen. Tel. & Electronics Corp., 518 F.2d 913, 926 (9th Cir. 1975) disapproved of on other grounds by California v. Am. Stores Co., 495 U.S. 271, 110 S. Ct. 1853, 109 L. Ed. 2d 240 (1990) (“Clayton Act [§] 16 provides a private equitable remedy, analogous to the private legal remedy of Clayton Act [§] 4, as a method of enforcement of the prohibitions of Clayton Act [§] 7.“). Unlike damages claims under section 4, which are subject to
First, “[i]n the context of a continuing conspiracy to violate the antitrust laws, . . . each time a plaintiff is injured by an act of the defendant[ ] a cause of action accrues to him to recover the damages caused by that act.” Zenith, 401 U.S. at 338, 91 S. Ct. 795. “[A]s to those damages, the statute of limitations runs from the commission of the act.” Id. In order to restart the statute of limitations, there must be a new overt act that: (1) is “new and independent . . . [and] not merely a reaffirmation of a previous act,” and (2) “inflict[s] new and accumulating injury on the plaintiff.” Pace, 813 F.2d at 238.
Second, the limitations period may start to run after the defendant‘s initial violation of the antitrust law, if it is “uncertain” or “speculative” whether the defendants’ antitrust violation has injured the plaintiff at the time of the violation. AMF, Inc. v. General Motors Corp. (In re Multidistrict Vehicle Air Pollution), 591 F.2d 68, 72 (9th Cir. 1979) (citing Zenith, 401 U.S. at 339, 91 S. Ct. 795); see also Samsung, 747 F.3d at 1204-05, 2014 WL 1328318 at *4. In such cases, the statute of limitations period begins on the date that the plaintiff‘s damages first “accrued and became ascertainable.” AMF, 591 F.2d at 73. We hold that both exceptions apply here.
Turning first to the continuing violation exception, the Supreme Court and federal appellate courts have recognized that each time a defendant sells its price-fixed product, the sale constitutes a new overt act causing injury to the purchaser and the statute of limitations runs from the date of the act. Klehr v. A.O. Smith Corp., 521 U.S. 179, 189, 117 S. Ct. 1984, 138 L. Ed. 2d 373 (1997); see also Hennegan v. Pacifico Creative Serv., Inc., 787 F.2d 1299, 1301 (9th Cir. 1986) (holding that a new overt act occurred each time tour operators’ shepherded tourists away from plaintiffs’ shop in exchange for payment); In re Cotton Yarn Antitrust Litig., 505 F.3d 274, 290-91 (4th Cir. 2007) (“[I]n cases like this one involving allegations of ‘a price-fixing conspiracy that brings about a series of unlawfully high priced sales over a period of years, each overt act that is part of the violation and that injures the plaintiff, e.g., each sale to the plaintiff, starts the statutory period running again.‘” (quoting Klehr, 521 U.S. at 189, 117 S. Ct. 1984)); Morton‘s Mkt., Inc. v. Gustafson‘s Dairy, Inc., 198 F.3d 823, 828 (11th Cir. 1999) amended in part, 211 F.3d 1224 (11th Cir. 2000) (holding that each sale of milk a price-fixed price constitutes a new overt act (citing Klehr, 521 U.S. at 189, 117 S. Ct. 1984)). Here, Plaintiffs allege in the FAC that they purchased SD cards on or after March 15, 2007, which is within four years of March 15, 2011, the
Plaintiffs’ claims are also timely under the speculative damages exception. In Zenith, Zenith‘s antitrust claim was not time-barred because, as the Supreme Court recognized, to require Zenith to establish damages at an earlier date would have required Zenith to present speculative evidence regarding Zenith‘s future performance. 401 U.S. at 341-42, 91 S. Ct. 795. This evidence likely would have been rejected by the trial court had Zenith filed suit earlier. Id. Similarly, in this case, Plaintiffs allege that they purchased SD cards in March 2007. Before Plaintiffs purchased SD cards, it would have been pure speculation whether Plaintiffs would have been harmed by Defendants’ alleged unlawful acts. Plaintiffs should not be penalized for failing to foresee earlier that they would enter the market for SD cards and would therefore be harmed by Defendants’ conduct. See Samsung, 747 F.3d at 1205, 2014 WL 1328318 at *4 (holding that the law did not require Samsung to bring suit where it was not clear whether Samsung would enter the market for SD cards and “the harm to Samsung . . . was [therefore] speculative at the time of the initial wrong“).
Thus, for the foregoing reasons, we conclude that Plaintiffs have alleged sufficient facts in the FAC to demonstrate that laches is not a bar to their federal antitrust claim.
III
The district court also erred in dismissing Plaintiffs’ state law claims. The district court held that “Plaintiffs’ state antitrust claims fall outside the statute of limitations period for all the same reasons applicable to its federal antitrust claims.” Oliver, 2012 WL 1835740 at *3 (citing
IV
In addition to asserting the statute of limitations as a defense, Defendants raise
V
The district court‘s dismissal order is reversed and the case is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.