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Sunday, May 19, 2024 | Back issues
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Retailers Can Press Case Against LCD Makers

(CN) - A class of electronics retailers can continue their claims against LCD panel manufacturers including Toshiba, Hitachi and Epson, among others, a federal judge ruled after finding the suit is not barred because it deals with foreign trade.

The plaintiffs claim that the electronics manufacturers engaged in a global price-fixing conspiracy to raise prices and restrict competition in the sales of computer monitors, laptops, televisions and other LCD products.

U.S. District Judge Susan Illston previously agreed that defendants "secretly conspired" to raise prices on LCD devices to "supra-competitive" levels.

However, the defendant manufacturers say the class claims are barred by the Foreign Trade Antitrust Improvements Act because the lawsuit involves "trade or commerce...with foreign nations."

The defendants also said the class' state-law claims should be dismissed because that Act "operates to constrain state antitrust laws from regulating where federal law does not."

The plaintiffs said the "domestic effect exception" applies in this case because there was sufficient evidence that the alleged conspiracy had direct effect on the United States.

Illston treated the defendants' motion as one for summary judgment, and agreed with the plaintiffs that the manufacturers' alleged price-fixing conspiracy had direct effects on American companies.

"In price-fixing cases such as this one, defendants would limit a 'direct effect' to the financial harm caused by the first sale of a price-fixed product," she wrote.

"(B)ecause the effect of defendants' anticompetitive conduct did not change significantly between the beginning of the process (overcharges for LCD panels) and the end (overcharges for televisions, monitors, and notebook computers), the effect 'proceeded without deviation or interruption' from the LCD manufacturer to the American retail store," Illston found.

"No intervening events interrupted its journey," she continued.

The judge denied defendants' joint motion for summary judgment on the indirect purchaser claims based on foreign sales.

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