Lead Opinion
delivered the opinion of the Court.
The issue presented by this case is whether § 4 of the Clayton Act, 38 Stat. 731, 15 U. S. C. § 15, authorizes a
I. Procedural History
Hawaii filed its initial complaint on April 1, 1968, against three of the four respondents.
The second count read, in relevant part:
“18. The above-named plaintiff [Hawaii], [acts] in its capacity as parens patriae, and/or as trustee*254 for the use of its citizens who purchased refined petroleum products, from any defendant or co-conspirator herein ....
“19. The unlawful contracts, combination, conspiracy in restraint of trade, unlawful combination and conspiracy to monopolize, and monopolization have resulted in the plaintiff, . . . and in its citizens, paying more for refined petroleum products than would have been paid in a freely operating competitive market. Plaintiff has not yet ascertained the precise extent of said damage to itself and its citizens, however, when said amount has been ascertained, plaintiff will ask leave of Court to insert said sum herein.”
Very similar language appeared in the class-action count. In all three counts, the State sought both injunctive and monetary relief.
After each of the respondents moved to dismiss the second and third counts of the complaint, the District Court held a hearing to determine the propriety of the State’s suing on behalf of its citizens. With respect to count two, the court held that Hawaii “has not even alleged an interest in its citizens’ claims, much less interest of its own aside from the State’s proprietary rights,” and granted the motions to dismiss.
Hawaii filed its fourth amended complaint on February 27, 1969. This is the complaint with which we are concerned. Count one contains a reiteration of Hawaii’s claim that in its proprietary capacity the State paid an
The parens patriae claim is stated in the following manner:
“19. The State of Hawaii, acting through its Attorney General, brings this action by virtue of its duty to protect the general welfare of the State and its citizens, acting herein as parens patriae, trustee, guardian and representative of its citizens, to recover damages for, and secure injunctive relief against, the violations of the antitrust laws hereinbefore alleged.
“20. The unlawful contracts, combination and conspiracy in restraint of trade, unlawful combination and conspiracy to monopolize and monopolization, hereinbefore alleged, have injured and adversely affected the economy and prosperity of the State of Hawaii in, among others, the following ways:
“(a) revenues of its citizens have been wrongfully extracted from the State of Hawaii;
“(b) taxes affecting the citizens and commercial entities have been increased to affect such losses of revenues and income;
“(c) opportunity in manufacturing, shipping and commerce have [sic] been restricted and curtailed;
“(d) the full and complete utilization of the natural wealth of the State has been prevented;
“(e) the high cost of manufacture in Hawaii has precluded goods made there from equal competitive access with those of other States to the national market;
“(f) measures taken by the State to promote the general progress and welfare of its people have been frustrated;
*256 “(g) the Hawaii economy has been held in a state of arrested development.
“21. Plaintiff has not yet ascertained the precise extent of said damage to itself and its citizens; however, when said amount has been ascertained, plaintiff will ask leave of Court to insert said sum herein.”
The class-action count is similar to that in the third amended complaint. As in the previous complaint, Hawaii seeks both injunctive and monetary relief in each count.
Respondents moved to dismiss the second and third counts, and hearing was again had in the District Court. The class action was dismissed by the court on the ground that “under the circumstances . . . , the class action based upon the injury to every individual purchaser of gasoline in the State, ... in the context of the pleadings, would be unmanageable.”
II. The State as Parens Patriae
The concept of parens patriae is derived from the English constitutional system. As the system developed from its feudal beginnings, the King retained certain duties and powers, which were referred to as the “royal prerogative.” Malina & Blechman, Parens Patriae Suits for Treble Damages Under the Antitrust Laws, 65 Nw. U. L. Rev. 193, 197 (1970) (hereinafter Malina & Blech-man) ; State Protection of its Economy and Environment: Parens Patriae Suits for Damages, 6 Col. J. L. & Soc. Prob. 411, 412 (1970) (hereinafter State Protection). These powers and duties were said to be exercised by the King in his capacity as “father of the country.”
The nature of the parens patriae suit has been greatly expanded in the United States beyond that which existed in England. This expansion was first evidenced in Louisiana v. Texas,
This Court’s acceptance of the notion of parens patriae suits in Louisiana v. Texas was followed in a series of cases: Missouri v. Illinois,
These cases establish the right of a State to sue as parens patriae to prevent or repair harm to its “quasi-sovereign” interests.
The only time this Court has ever faced the question of what relief, if any, the antitrust laws offer a State suing as parens patriae was in Georgia v. Pennsylvania R. Co.,
Like this suit, Georgia arose under the federal antitrust laws. It is plain from the face of the complaint that “[t]he prayer [was] for damages and for in-junctive relief.”
The Court upheld Georgia’s claim as parens patriae with respect to injunctive relief, but had no occasion to consider whether the antitrust laws also authorized damages for an injury to the State’s economy, since approval of the challenged rates by the Interstate Commerce Commission barred a damage recovery on the ground that such a remedy would have given Georgia shippers an unfair advantage over shippers from other States. See Keogh v. Chicago & Northwestern R. Co.,
III. Hawaii and the Antitrust Laws
Hawaii grounds its claim for treble damages in § 4 of the Clayton Act, 15 U. S. C. § 15, which reads:
“Any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney’s fee.”
This section is notably different from § 16 of the Clayton Act, 15 U. S. C. § 26, which provides for injunctive relief:
“Any person, firm, corporation, or association shall be entitled to sue for and have injunctive relief, in any court of the United States having jurisdiction over the parties, against threatened loss or damage*261 by a violation of the antitrust laws . . . when and under the same conditions and principles as injunc-tive relief against threatened conduct that will cause loss or damage is granted by courts of equity, under the rules governing such proceedings . . . .”
Hawaii plainly qualifies as a person under both sections of the statute, whether it sues in its proprietary capacity or as parens patriae. Georgia v. Pennsylvania R. Co.,
The legislative history of the Sherman and Clayton Acts is not very instructive as to why Congress included the “business or property” requirement in § 4, but not in § 16. The most likely explanation lies in the essential differences between the two remedies.
While the United States Government, the governments of each State, and any individual threatened with injury by an antitrust violation may all sue for injunctive relief against violations of the antitrust laws, and while they may theoretically do so simultaneously against the same persons for the same violations, the fact is that one injunction is as effective as 100, and, concomitantly, that 100 injunctions are no more effective than one. This case illustrates the point well. The parties are in virtual agreement that whether or not Hawaii can sue for injunctive relief as parens patriae is of little consequence so long as it can seek the same relief in its proprietary capacity. While some theoretical differences may exist with respect to the parties capable of enforcing a parens patriae injunction as opposed to one secured by a State in its proprietary capacity, these differences are not crucial to the defendant in an antitrust case.
The position of a defendant faced with numerous claims for damages is much different. If the defendant
Every violation of the antitrust laws is a blow to the free-enterprise system envisaged by Congress. See Northern Pacific R. Co. v. United States,
Thus, § 4 permits Hawaii to . sue in its proprietary capacity for three times the damages it has suffered from respondents’ alleged antitrust violations.
A large and ultimately indeterminable part of the injury to the “general economy,” as it is measured by economists, is no more than a reflection of injuries to the “business or property” of consumers, for which they may recover themselves under § 4. Even the most lengthy and expensive trial could not, in the final analysis, cope with the problems of double recovery inherent in allowing damages for harm both to the economic interests of individuals and for the quasi-sovereign interests of the State. At the very least, if the latter type of injury is to be compensable under the antitrust laws, we should insist upon a clear expression of a congressional purpose to make it so, and no such expression is to be found in § 4 of the Clayton Act.
Like the lower courts that have considered the meaning of the words “business or property,” we conclude that they refer to commercial interests or enterprises. See, e. g., Roseland v. Phister Mfg. Co.,
Support for this reading of § 4 is found in the legislative history of 15 U. S. C. § 15a,
“The United States is, of course, amply equipped with the criminal and civil process with which to enforce the antitrust laws. The proposed legislation, quite properly, treats the United States solely as a buyer of goods and permits the recovery of the actual damages suffered.” S. Rep. No. 619, 84th Cong., 1st Sess., 3 (1955).
See also H. R. Rep. No. 422, 84th Cong., 1st Sess., 2-5 (1955). In light of the language used as well as the legislative history of 15 U. S. C. § 15a, it is manifest that the United States cannot recover for economic injuries to its sovereign interests, as opposed to its proprietary functions. And the conclusion is nearly inescapable that § 4, which uses identical language, does not authorize recovery for economic injuries to the sovereign interests of a State.
We note in passing the State’s claim that the costs and other burdens of protracted litigation render private citizens impotent to bring treble-damage actions, and thus that denying Hawaii the right to sue for injury to her quasi-sovereign interests will allow antitrust violations to go virtually unremedied. Private citizens are not as powerless, however, as the State suggests.
Parens patriae actions may, in theory, be related to class actions, but the latter are definitely preferable in the antitrust area. Rule 23 provides specific rules for delineating the appropriate plaintiff-class, establishes who is bound by the action, and effectively prevents duplica-tive recoveries.
The judgment of the Court of Appeals is affirmed for the reasons stated above.
So ordered.
Mr. Justice Powell and Mr. Justice Rehnquist took no part in the consideration or decision of this case.
Notes
Chevron Asphalt Co. was not named as a defendant in the initial complaint. As pointed out in the text, infra, the company was named' as a defendant in the third and fourth amended complaints which raise the question presented to the Court.
In the third amended complaint, the State abandoned a claim made in the initial complaint that the Robinson-Patman Act, 49 Stat. 1526, 15 U. S. C. § 13 (a), had been violated. This claim has not been resurrected in any of the later stages of the proceedings.
The opinion of the court is unreported, but is contained in App. 51-58.
Id., at 58.
Reporter’s Tr. 154 (May 29, 1969).
The District Court offered to certify its dismissal of Hawaii’s class-action count, but Hawaii indicated its intention not to appeal the ruling. Since the ruling was not appealed it is not before the Court for review.
Although the Court of Appeals directed that the count be dismissed in its entirety, the parties have not suggested that its decision foreclosed any relief the State might obtain by way of injunction.
Malina & Blechman, at 197; State Protection, at 412.
State Protection, at 412.
3 W. Blackstone, Commentaries *47.
Ibid.
Article III, § 2, of the Constitution confers original jurisdiction upon this Court over suits between States or by one State against a citizen of another State. In order to properly invoke this jurisdiction, the State must bring an action on its own behalf and not on
It is evident from the bill of complaint that Georgia sought to sue in four slightly different capacities: its sovereign capacity (first count); as a quasi-sovereign (second count); its proprietary capacity (third count); and as protector of a general class of its citizens (fourth count). Damages were sought in each count, although treble damages were sought only on the last count.
It is true, as Mr. Justice BreNNAn suggests, that an injury to the State in its proprietary capacity, as alleged in count one of the complaint, affects the citizens in much the same way as an injury of the sort claimed by Hawaii here. Each has the effect of
The lower courts have been virtually unanimous in concluding that Congress did not intend the antitrust laws to provide a remedy in damages for all injuries that might conceivably be traced to an antitrust violation. See, e. g., Miley v. John Hancock Mutual Life Insurance Co.,
“Whenever the United States is hereafter injured in its business or property by reason of anything forbidden in the antitrust laws it may sue therefor . . . , and shall recover actual damages by it sustained and the cost of suit.” 69 Stat. 282, 15 U. S. C. § 15a.
This section was enacted in 1955 following the decision in United States v. Cooper Corp.,
Dissenting Opinion
dissenting.
Today’s decision reflects a miserly approach to the fashioning of federal remedies rectifying injuries to the collective interests of the citizens of a State through
Hawaii, in her fourth amended complaint, sues for damages and injunctive relief as parens patriae by virtue of her “duty to protect the general welfare of the State and its citizens.” She alleges that the alleged conspiracy among the respondent oil companies has “injured and adversely affected the economy and prosperity” of Hawaii as follows:
“(a) revenues of its citizens have been wrongfully extracted from the State of Hawaii;
“(b) taxes affecting the citizens and commercial entities have been increased to affect such losses of revenues and income;
“(c) opportunity in manufacturing, shipping and commerce have been restricted and curtailed;
“(d) the full and complete utilization of the natural wealth of the State has been prevented;
“(e) the high cost of manufacture in Hawaii has precluded goods made there from equal competitive access with those of other States to the national market;
“(f) measures taken by the State to promote the general progress and welfare of its people have been frustrated ;
*268 “(g) the Hawaii economy has been held in a state of arrested development.”
I see no way of distinguishing the instant case from Georgia v. Pennsylvania R. Co.,
“Georgia as a representative of the public is complaining of a wrong which, if proven, limits the opportunities of her people, shackles her industries, retards her development, and relegates her to an inferior economic position among her sister States. These are matters of grave public concern in which Georgia has an interest apart from that of particular individuals who may be affected.” Id., at 451.
So-called “growth,” “progress,” and “development” are more than symbols of power in modern society; they represent the goal which planners — private and public alike — establish and seek to attain. And the State plays an important, at times crucial, role in achieving that goal.
The Court of Appeals was “skeptical of the existence of an independent harm to the general economy.”
“Economists have developed models for measuring the effects upon local economies from infusions or extractions of given sums of money from those economies. In short, a state’s economy is susceptible of articulation and measurement.”
Hawaii is the magnet of tourism and of industry as well. She measures the health of her economy by her economic growth. No one citizen can stand in her shoes in those respects, for she represents the collective. Those interests should be held to be the State’s “business or property” interests, within the meaning of the Clayton Act, and not merely the plants, factories, or hotels which she may own as a proprietor. We held as much in the Georgia case. It is indisputable that if Hawaii does prove damages, Georgia authorizes recovery. For as Mr. Justice Brennan points out, Georgia was denied damages only because of a technicality irrelevant to the present case.
Injury to the collective will commonly include injury to members of the collective. In that event damages recovered by Hawaii could not later be recovered by individual entrepreneurs. It might, of course, be shown that the individual’s loss for the period in question was distinct from any impact on the collective. Thus, if
I would adhere to the Georgia case and allow Hawaii a chance to prove her charges and to establish the actuality of damages or the need for equitable relief.
I would reverse the judgment and remand the case for trial.
In Wyandotte, the Court refused to exercise its conceded original jurisdiction over an original complaint filed by the State of Ohio to enjoin alleged pollution of Lake Erie by manufacturing plants in Michigan and Ontario, Canada, because “as a practical matter, it would be inappropriate for this Court to attempt to adjudicate the issues . . .
“In these three respects — as a clearing house for necessary institutional innovations; as an agency for resolution of conflicts among group interests; and as a major entrepreneur for the socially required infrastructure — the sovereign state assumes key importance in channeling the explosive impacts of continuous structural changes, in providing a proper framework in which these structural changes, proceeding at revolutionary speed, are contained and prevented from exploding into a civil war (as they sometimes may, and have). Thus, the high rate of change in economic structure is linked to the importance of the sovereign state as an organizing unit. It is not accidental that, in measuring and analyzing economic growth, we talk of the economic growth of nations and use national economic accounts. In doing so, we imply that the sovereign state is an
The question of injunctive relief concerns the meaning of § 16 of the Clayton Act which grants relief to any “person” against loss or damage by a violation of “the antitrust” laws. It is settled that a State is a “person” within the meaning of § 16. Georgia v. Pennsylvania R. Co.,
My quarrel with the Court does not extend to its approving reference to the possibility that Hawaii may yet be able to maintain a class action on behalf of her consumers, ante, at 266. Cf. Comment, Wrongs Without Remedy: The Concept of Parens Patriae Suits for Treble Damages Under the Antitrust Laws, 43 S. Cal. L. Rev. 570, 580-583 (1970). The District Court’s dismissal of Hawaii’s class action count as “unmanageable” was not certified for interlocutory appeal, and Hawaii’s rights under Fed. Rule Civ. Proc. 23 are not before us for review.
Dissenting Opinion
with whom Mr. Justice Douglas joins, dissenting.
The State of Hawaii seeks treble damages and injunc-tive relief for an alleged conspiracy among respondents to monopolize and fix prices on the sale of petroleum
Georgia v. Pennsylvania R. Co.,
“The enforcement of the criminal sanctions of [the antitrust] acts has been entrusted exclusively to the federal government. See Georgia v. Evans, [316 U. S. 159 ,] 162. But when it came to other sanctions Congress followed a different course and authorized civil suits not only by the United States but by other persons as well. And we find no indication that, when Congress fashioned those civil remedies, it restricted the States to suits to protect their proprietary interests. Suits by a State, parens patriae, have long been recognized. There is no apparent reason why those suits should be excluded from the purview of the anti-trust acts.” Id., at 447.
Georgia was in fact denied damages, but only because such recovery might operate as an illegal rebate on rates already approved by the Interstate Commerce Commission. See Keogh v. Chicago & Northwestern R. Co.,
Even if Georgia were not dispositive, I would still find in Hawaii's parens patriae count a claim of injury to its “business or property” sufficient to state a claim under § 4. There runs through the Court’s opinion an assumption that Hawaii's proprietary claims, though concededly sufficient to state a cause of action, are wholly distinct in concept from those raised by the State as parens patriae. While I agree that the two counts represent injuries to the State in separate capacities, the injuries themselves are not so unrelated as to justify a different treatment under the Clayton Act. In Chattanooga Foundry & Pipe Works v. City of Atlanta,
“It was injured in its property, at least, if not in its business of furnishing water, by being led to pay more than the worth of the pipe. A person whose property is diminished by a payment of money wrongfully induced is injured in his property.” Id., at 396.
See also Georgia v. Evans,
The determinant, then, is whether “property is diminished by a payment of money wrongfully induced.” But what was the nature of the injury to property for which recovery was permitted in Chattanooga? Clearly it was nothing more than the added expense incurred by the city's treasury as the result of the antitrust violation.
This is the same sort of interest sought to be protected here. Hawaii’s economy, to which tourism and the tourist trade are important, would be particularly vulnerable to injury from a price conspiracy involving petroleum products. In seeking to preserve the economic opportunities of its people, and the tax revenues generated thereby, Hawaii is asserting an interest not significantly different in concept from that involved in Chattanooga. Whether the injury sought to be remedied consists of additional payments from the public purse, as in that case, or the failure to generate additional wealth, as here, the result in either instance.is the same— the government and its population, as entities, have suffered harm to their economic well-being. If that harm is characterized “business or property” in one case, then we stretch no traditional property concepts in applying the same label in the other.
“The American taxpayer is entitled to full value for his tax dollar. He should be protected against its going into the pockets of wrongdoers in the form of excessive prices and profits gained through violation of the antitrust laws. If he were spending the money himself, he could sue for triple damages. Surely, he is entitled to protection from actual loss where the Government spends it for him. By permitting the United States Government to recover the provable damages resulting from*276 unlawful practices engaged in by those with whom it does business, [§ 15a] would afford those safeguards necessary to the Public Treasury and at the same time severely deter those who would conspire in their dealings with Federal departments.” H. R. Rep. No. 422, 84th Cong., 1st Sess., 4-5 (1955).
At the same time, however, Congress felt that “unlike the situation with respect to private persons, there is no need to furnish the Government any special incentive to enforce the antitrust laws, a heavy responsibility with which it is already charged,” and therefore Congress granted “to the Government the right to recover only actual, as distinguished from treble, damages.” Id., at 4. In addition, Congress felt that the United States was “amply equipped with the criminal and civil process with which to enforce the antitrust laws. The proposed legislation, quite properly, treats the United States solely as a buyer of goods and permits the recovery of the actual damages suffered.” S. Rep. No. 619, supra, at 3.
Thus § 15a served a narrower purpose than the treble-damages provisions of the Sherman and Clayton Acts. The United States was “amply equipped” with “criminal and civil process” for general enforcement, and needed a damage remedy solely to protect itself “as a buyer of goods.” On the other hand private litigants, including the States, lacked the Government’s “criminal and civil process.” Yet they were viewed as primary enforcers of antitrust policy and were armed with the weapon of triple recovery as a means of stimulating their efforts. It is plain from the history of § 15a that Congress did not intend the States to be denied the treble-damages remedy Hawaii pursues here.
Finally, this result does not necessarily lead to double recovery. Since Hawaii is by definition asserting claims “independent of and behind the titles of its citizens,”
In sum, I think that since no one questions that Hawaii can maintain a treble-damages action in its proprietary capacity, for analogous reasons, Hawaii may also maintain the action pleaded in count two as parens patriae.
The Court seems to concede as much in saying that an “injury to the State in its proprietary capacity . . . affects the citizens in much the same way as an injury of the sort claimed by Hawaii here.” Ante, at 262 n. 14. Yet because the assessment of damages might prove more difficult in a parens patriae than a proprietary action, the Court concludes that “the two kinds of injuries are [not] identical in nature.” Id., at 263 n. 14. The Court plainly confuses two separate issues. The injury to Hawaii’s general economy may present problems of proof not raised in its proprietary action, but a mere difficulty in the assessment of damages cannot change the nature of the damage claimed. In short, I think that Hawaii has alleged an injury to its “business or property,” and, on the entirely separate question of proving damages, agree with my Brother Douglas that the injury can be quantified, or at least approximated.