Keep Calm and Causation On: Reframing Causation Analysis in Private Section 1 Antitrust Actions at Summary Judgment

Author:Anne E. Hartnett
Position:J.D., The University of Iowa College of Law, 2017; B.A., Iowa State University, 2014
Pages:2291-2324
SUMMARY

A private plaintiff's ability to enforce antitrust violations critically hinges upon proof that the plaintiff's injury was in fact caused by the defendant's antitrust violation—a deceptively simple requirement. This Note traces the history of the treatment of the causation element in private Section 1 antitrust conspiracy claims, as well as the differing approaches courts apply to the causation... (see full summary)

 
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2291
Keep Calm and Causation On: Reframing
Causation Analysis in Private Section 1
Antitrust Actions at Summary Judgment
Anne E. Hartnett*
ABSTRACT: A private plaintiff’s ability to enforce antitrust violations
critically hinges upon proof that the plaintiff’s injury was in fact caused by
the defendant’s antitrust violation—a deceptively simple requirement. This
Note traces the history of the treatment of the causation element in private
Section 1 antitrust conspiracy claims, as well as the differing approaches
courts apply to the causation element when ruling on motions for summary
judgment in Section 1 cases. In particular, this Note elaborates on how the
adoption and use of the traditional tort law concept of causation in antitrust,
as well as the heightened standards found in unrelated antitrust inquiries,
has rendered federal courts incapable of properly examining economic
evidence of causation. This Note advocates for more procedurally prudent
court practices when assessing the causation element in pretrial rulings. Such
practices are intended to hold courts accountable for verifying that a Section
1 plaintiff has sound evidence of causation before a case reaches a jury, while
also ensuring that courts do not go beyond their role as gatekeepers when
ruling on motions for summary judgment.
I. INTRODUCTION ........................................................................... 2292
II. THE FUNDAMENTALS AND DEVELOPMENT OF CAUSATION
ANALYSIS IN SECTION 1 CASES AT SUMMARY JUDGMENT ............. 2294
A. LEGAL RULES FOR BRINGING AND WINNING A PRIVATE
SECTION 1 CONSPIRACY CLAIM .............................................. 2295
1. The Clayton Act’s Private Right of Enforcement ...... 2295
2. Section 1 Conspiracy Claims ...................................... 2297
B. THE EVER-ELUSIVE NATURE OF ANTITRUST CAUSATION .......... 2299
1. The Abstract Causation Element in Private
Antitrust Actions .......................................................... 2299
* J.D., The University of Iowa College of Law, 2017; B.A., Iowa State University, 2014.
Thank you to Professor Herbert Hovenkamp for sparking my interest in this complex and
fascinating topic. Thank you also to my friends and editors on the Iowa Law Review for their
thoughtful suggestions and help with this Note.
2292 IOWA LAW REVIEW [Vol. 102:2291
2. Antitrust Standing and its Effect on the Causation
Element ........................................................................ 2301
C. THE RISE OF SUMMARY JUDGMENT IN PRIVATE SECTION 1
CONSPIRACY CASES ................................................................ 2302
1. Summary Judgment Loses its Leniency ..................... 2302
2. Summary Judgment Post-Matsushita: Plaintiff’s
Friend Turned Foe ...................................................... 2303
III. THE TWO PRIMARY STANDARDSAND CAUSESOF IMPROPER
SECTION 1 CAUSATION ANALYSIS AT SUMMARY JUDGMENT ........ 2305
A. THE DEFERENTIAL APPROACH: A HISTORY OF PILING
INFERENCE UPON INFERENCE ................................................. 2305
1. The Original Distinction Between Causation and
Quantification ............................................................. 2307
2. How Bigelow’s Misinterpretation of Precedent
Formed the Zenith Radio Standard ............................. 2309
3. Too Great of Inferences ............................................. 2311
B. THE HEIGHTENED APPROACH: AN UNCLEAR VISION OF
CAUSATION-IN-FACT .............................................................. 2313
1. Misapplied Antitrust Standing and Injury
Concepts ...................................................................... 2315
2. Misunderstandings of Matsushita and Proof of
“Economic Plausibility” ............................................... 2316
IV. THE PROPER STANDARD OF ANALYSIS: RETURNING TO AN
ANALYSIS OF CAUSATION THAT REQUIRES ECONOMICALLY
SOUND THEORIES BASED IN FACTS ............................................. 2318
A. EXPRESSLY SEPARATING CAUSATION-IN-FACT IN SECTION 1
CLAIMS ................................................................................. 2318
B. RETURNING TO THE GATEKEEPING FUNCTION ......................... 2319
1. Focusing on Procedural Requirements Through
Economic Substance ................................................... 2320
2. Untangling “But-For” Causation from Material
Cause ............................................................................ 2322
V. CONCLUSION .............................................................................. 2323
I. INTRODUCTION
In the whole of civil litigation, arguably no party has a more difficult time
surviving a motion for summary judgment than a plaintiff alleging an injury
from a violation of the federal antitrust laws. Although the forms of antitrust
violations contain different elements, every private plaintiff must prove that
2017] KEEP CALM AND CAUSATION ON 2293
his or her injury was in fact caused by a defendant’s antitrust violation.1 While
establishing causation is universally required in all civil claims, attempting to
either prove or assess causation in the antitrust context is particularly
challenging. The difficulty of proving a causal connection is most often felt in
the context of motions for summary judgment, where even courts appear
unsure of what level and form of proof is required to satisfy the causation
element. Amidst this confusion, plaintiffs claiming a Section 1 conspiracy may
have to overcome an additional burden of proof—namely, that it is more
likely than not that the defendant in fact caused the plaintiff’s injury.2
As such, there is currently a large degree of inconsistent analysis and
outcomes in rulings on motions for summary judgment in Section 1 cases.
More specifically, two polar-opposite approaches have created a spectrum of
inconsistency: under the first, courts simply presume that a plaintiff has
sufficiently established a causal connection once the judge deems the other
elements can be reasonably inferred; and under the other, courts strictly
require a determination as to whether a plaintiff has proved a causal
connection to a reasonable certainty.3
In early 2014, this inconsistency came to light in a Sixth Circuit decision
that reversed a grant of summary judgment against dairy retailers who alleged
that a group of milk wholesalers had illegally fixed prices in violation of
Section 1 of the Sherman Act.4 While the district court found that the dairy
retailers’ expert failed to show that the alleged conspiracy did in fact cause
milk prices to increase,5 the court of appeals found that because the re was
enough evidence to reasonably infer a conspiracy and an unexplained rise in
prices and thus an injury, the price increase “clearly result[ed]” from the
price-fixing conspiracy.6 The defendants petitioned the Supreme Court to
1. See, e.g., El Aguila Food Prods., Inc. v. Gruma Corp., No. 04-20125, 2005 WL 1156090,
at *2 (5th Cir. May 17, 2005) (“The fact of damage requirement is one of causation; the plaintiff
must show that the defendant’s unlawful conduct was a material cause of injury to its business.”);
Abcor Corp. v. AM Int’l, Inc., 916 F.2d 924, 931 (4th Cir. 1990) (affirming summary judgment
because plaintiffs “failed to show a causal link to anticompetitive activity”).
2. See, e.g., Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986)
(“To survive a motion for summary judgment or for a directed verdict, a plaintiff seeking damages
for a violation of § 1 must present evidence ‘that tends to exclude the possibility’ that the alleged
conspirators acted independently.” (quoting Monsanto Co. v. Spray-Rite Serv. Corp., 465 U.S.
752, 764 (1984))); Monsanto, 465 U.S. at 764 (“[S]omething more than evidence of complaints
is needed. There must be evidence that tends to exclude the possibility that the [two defendants]
were acting independently.”).
3. See infra Part III.
4. In re Se. Milk Antitrust Litig., 739 F.3d 262, 268 (6th Cir. 2014).
5. In re Se. Milk Antitrust Litig., No. 2:08–MD–1000, 2012 WL 1032797, at *6 (E.D. Tenn.
Mar. 27, 2012) (“Further, it appears to the Court that [the plaintiffs’ expert] cannot, and did
not, measure how prices would have increased in the absence of a conspiracy. He simply
compared pre-merger prices to post-merger prices. In short, [the expert’s] analysis does not
create a material issue of fact on the question of whether the price i ncreases were ‘by reason of’
an illegal conspiracy in violation of the antitrust laws . . . .”), rev’d, 739 F.3d 262 (6th Cir. 2014).
6. In re Se. Milk Antitrust Litig., 739 F.3d at 286 (“[W]hen competition is limited purs uant
to an agreement and customers are punished through higher prices, the in jury clearly results
from anticompetitive conduct.”).

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