Antitrust Claims Potentially Suitable for Class Treatment

• Pages: 43-72

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CHAPTER III

ANTITRUST CLAIMS POTENTIALLY SUITABLE

FOR CLASS TREATMENT

The antitrust laws cover a broad array of marketplace conduct, and,

depending on the type of conduct being challenged, the legal rules that

will govern the class action—especially the applicability of the per se

rule of illegality or the rule of reason—will vary. Different types of

antitrust claims require proof of different elements, which can inject

varying levels of complexity into a case, thereby making class action

adjudication more difficult. This section explores the primary types of

antitrust actions and considers whether, and under what circumstances,

an antitrust complaint can appropriately be considered on a class-wide

basis.

A. Horizontal Restraints of Trade

1. Horizontal Price Fixing

Courts have frequently held that “[a]ntitrust, price-fixing conspiracy

cases, by their nature, deal with common legal and factual questions

about the existence, scope and effect of the alleged conspiracy.”1 As a

result, motions for class certification concerning price-fixing claims are

often granted when the plaintiffs can demonstrate that the alleged

conspiracy had a uniform impact on the plaintiff class.2

Certain types of price-fixing conspiracies, however, are more

susceptible to class treatment than others. For example:

[C]ourts have refused to certify price-fixing cases [where] proof of

conspiracy as to numerous defendants cannot be accomplished on a

class-wide basis or when proof of fact of damage would be

1. In re Sugar Antitrust Litig., 73 F.R.D. 322, 335 (E.D. Pa. 1976).

2. See, e.g., In re Playmobil Antitrust Litig., 35 F. Supp. 2d 231, 240-41

(E.D.N.Y. 1998), and cases cited.

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unmanageable because of the intricate nature of the market or the

number of potential plaintiffs.3

a. Conspiracies Involving Numerous Defendants

One circumstance where courts are less likely to certify antitrust

cases alleging horizontal price-fixing conspiracies are those that invol ve

a large number of defendants. Courts have indicated that unless plaintiffs

can demonstrate that the defendants acted in a consistent and predictable

way, it may be difficult to satisfy the Rule 23 requirements for class

certification.

In In re Hotel Telephone Charges Antitrust Litigation,4 for example,

the plaintiffs alleged a nationwide conspiracy against 47 hotel chains and

600 individual hotels. The court denied the plaintiffs’ motion for class

certification, finding that class treatment was not a superior method of

adjudication because the action involved hundreds of defendants, was

likely to consume decades of judicial time, the average individual

recovery in the case was estimated to be only two dollars, and the

amount of recovery would be entirely consumed by the costs of notice

alone.5

b. Antitrust Impact as the Central Issue

“Individual injury (also known as antitrust impact) is an element of

the cause of action; to prevail on the merits, every class member must

prove at least some antitrust impact resulting from the alleged

3. Krehl v. Baskin-Robbins Ice Cream Co., 78 F.R.D. 108, 121 (C.D. Ca.

1978). See also Fertig v. Blue Cross of Iowa, 68 F.R.D. 53, 59 (N.D.

Iowa 1974) (certification denied where proposed class consisted of 2.5

million hospital patients); Boshes v. Gen. MotorsCorp., 59 F.R.D. 589,

599 (N.D. Ill. 1973) (denying certification of class of 30-40 million

automobile purchasers); In re Ampicillin Antitrust Lit ig., 55 F.R.D. 269,

277 (D.D.C. 1972) (certification denied for class brought on behalf of

millions of consumers); City of Philadelphia v. Am. Oil Co., 53 F.R.D.

45, 70-74 (D.N.J. 1971) (millions of gasoline purchasers); United Egg

Producers v. Bauer Int’l Corp., 312 F. Supp. 319, 321 (S.D.N.Y. 1970)

(all consumers of eggs in the United States).

4. 500 F.2d 86, 88 (9th Cir. 1974).

5. Id. at 91; see also Kline v. Coldwell Banker & Co., 508 F.2d 226, 235-36

(9th Cir. 1974) (class certification denied where plaintiffs would have

burden to prove knowledge of fee schedule by over 2,000 individual

broker defendants to establish conspiracy as to each defendant).