Causation And Damages

• Pages: 300-330

Chapter 6

CAUSATION AND DAMAGES

A. Clayton Act Section 4 Requirements

1. Instruction 1: Injury and Causation

If you find that defendant has violated [the applicable section of the

Sherman, Clayton, or Robinson-Patman] Act, then you must decide if

plaintiff is entitled to recover damages from defendant.

Plaintiff is entitled to recover damages for an injury to its business or

property if it can establish three elements of injury and causation:

(1) plaintiff was in fact injured as a result of defendant’s alleged

violation of the antitrust laws;

(2) defendant’s alleged illegal conduct was a material cause of

plaintiff’s injury; and

(3) plaintiff’s injury is an injury of the type that the antitrust laws were

intended to prevent.1

The first element is sometimes referred to as “injury in fact” or “fact

of damage.” For plaintiff to establish that it is entitled to recover damages,

it must prove that it was injured as a result of defendant’s alleged violation

of the antitrust laws.2 Proving the fact of damage does not require plaintiff

to prove the dollar value of its injury. It requires only that plaintiff prove

that it was in fact injured by defendant’s alleged antitrust violation. If you

find that plaintiff has established that it was in fact injured, you may then

consider the amount of plaintiff’s damages. It is important to understand,

however, that injury and amount of damage are different concepts and that

you cannot consider the amount of damage unless and until you have

concluded that plaintiff has established that it was in fact injured.3

Plaintiff must also offer evidence that establishes by a preponderance

of the evidence that defendant’s alleged illegal conduct was a material

cause of plaint iff’s injury.4 This means that plaintiff must have proved that

some damage occurred to it as a result of defendant’s alleged antitrust

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violation, and not some other cause. Plaintiff is not required to prove that

defendant’s alleged antitrust violation was the sole cause of its injury; nor

need plaintiff eliminate all other possible causes of injury. It is enough if

plaintiff has proved that the alleged antitrust violation was a material cause

of its injury.

Finally, plaintiff must establish that its injury is the type of injury that

the antitrust laws were intended to prevent.5 This is sometimes referred to

as “antitrust injury.” If plaintiff’s injuries were caused by a reduction in

competition, acts that would lead to a reduction in competition, or acts that

would otherwise harm consumers, then plaintiff’s injuries are antitrust

injuries. On the other hand, if plaintiff’s injuries were caused by

heightened competition, the competitive process itself, or by acts that

would benefit consumers, then plaintiff’s injuries are not antitrust injuries

and plaintiff may not recover damages for those injuries under the antitrust

laws.6

[Insert the following if plaintiff is a competitor of defendant.]7 You

should bear in mind that businesses may incur losses for many reasons that

the antitrust laws are not designed to prohibit or protect against—such as

where a competitor offers better products or services, or where a

competitor is more efficient and can charge lower prices and still earn a

profit. The antitrust laws do not permit a plaintiff to recover damages for

losses that were caused by the competitive process or conduct that benefits

consumers.8

In summary, if plaintiff can establish that it was in fact injured by

defendant’s conduct, that defendant’s conduct was a material cause of

plaintiff’s injury, and that defendant’s injury was the type that the antitrust

laws were intended to prevent, then plaintiff is entitled to recover damages

for the injury to its business or property.

NOTES

1. 15 U.S.C. §15; Atlantic Richfield Co. v. USA Petrol. Co., 495 U.S. 328,

334-46 (1990); Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 122 (1986);

Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 488 (1977); Perma

Life Mufflers v. International Parts Corp., 392 U.S. 134, 143-44 (1968) (White,

J., concurring).

2. Depending on the facts of the case, a jury instruction may or may not be

necessary on this particular element (i.e., whether the injury is the type that the

antitrust laws were i ntended to prevent). For example, in a horizontal price-fixing

case brought by direct-purchaser plaintiffs, the parties may not dispute whether

the alleged overcharges represent cognizable antitrust injury. See Cordes & Co.