Jurisdiction and Choice of law Issues in the Indirect Purchaser action

Most indirect purchaser damages cases arise under state law.
While at one time this meant that indirect purchaser actions
frequently proceeded in state court, Congress’s passage of the Class
Action Fairness Act of 2005 (CAFA) now renders federal courts the
predominant forum for such cases.1 Moreover, alleged antitrust
violations of significance frequently give rise to many suits in
different federal courts, leading to MDL proceedings consolidating
and/or coordinating such actions before a single federal judge. That
judge then must manage a collection of actions arising out of a single
alleged violation or series of violations, but asserting violations of
multiple states’ l aws. Those actions take many forms: class actions
seeking certification of a nationwide class and pressing claims under
the laws of the defendants’ residences; class actions seeking
certification of statewide classes pressing claims under the laws of
those states; and individual plaintiffs seeking recovery for purchases
made in a variety of states. Because many such cases involve
defendants from multiple states and countries, the potential
jurisdictional and choice of law issues are critical.
This chapter addresses those issues in two parts. Part A discusses
the basic personal and subject matter jurisdictional questions arising
in indirect purchaser litigation. Part B discusses the basic choice of
law issues that also arise in indirect purchaser litigation, with a
particular focus both on putative nationwide classes seeking to apply
a single state’s laws to in-state and out-of-state purchasers and on
multistate classes (or multiple single-state subclasses) seeking to
apply multiple states’ laws in a single proceeding.
1. As described more fully in part A.2.c of this chapter, under CAFA,
federal jurisdiction may exist over any class action in which: (1) any
plaintiff is diverse from an y defendant; (2) the putative class contains
at least o ne hundred members; and (3) the amount in controversy by
the entire class action is at least $5 million. See 28 U.S.C.
§ 1332(d)(2), (d)(5), (d)(6).
90 Indirect P urchaser Litigation Ha ndbook
A. Jurisdictional Prerequisites and the Availability of a Federal
Forum for State Law Indirect Purchaser Claims
1. Personal Jurisdiction
a. Existence of Personal Jurisdiction
As in any litigation, courts presiding over indirect purchaser
litigation must possess personal jurisdiction over the parties. As to
out-of-state members of a class, courts have personal jurisdiction
over these individuals or entities, even if those class members reside
outside the forum state and have no other connections to it, provided
they receive adequate notice and opt-out rights.2 Because absent class
members need not do anything in response to the lawsuit, due process
does not require that they receive as much protection as those
compelled to act.3
Personal jurisdiction over defendants, however, is not so clear-
cut. Personal jurisdiction takes two forms: “general” and “specific.” 4
Normally, courts have general jurisdiction over defendants with a
“continuous and systematic” pursuit of general business activities in
the forum state, regardless of where the cause of action arises.5
Specific jurisdiction exists for cases that arise from or relate to the
defendant’s actions within the forum state.6 Under either standard,
the court’s exercise of jurisdiction must comport with due process,
which turns on whether “the defendant purposefully established
‘minimum contacts’ in the forum State.”7
Jurisdiction in cases alleging only state law violations turns on
typical and well-established concepts, which generally do not differ
2. Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 814 (1985); see also
Gen. Con tracting & Trading Co. v. Interpole, Inc., 940 F.2d 20, 23
n.4 (1st Cir. 1991) (“In the context of personal jurisdiction, it is
settled that the concept of a ‘state’s courts’ includes those federal
courts located within the state.”).
3. Phillips P etroleum, 472 U.S. at 806-11. As discussed further in
part B.2.a of this chapter, the question as to whether a named plaintiff
possesses standing to represent out-of-state class members is a
separate question.
4. See Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 415-
16 (1984). Importantly, not all states recognize general jurisdiction as
an app ropriate basis on which to exercise personal jurisdiction over
an out-of-state defendant. In these states, personal jurisdiction may be
asserted only if the plai ntiff’s cause of action arises from or is related
to the foreign defendant’s forum activities.
5. Id. at 416.
6. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985).
7. Id. at 474 (quoting citation omitted).

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