Antitrust Law Daily Wrap Up, ANTITRUST—N.D. Cal.: Home Depot’s Cartwright Act, injunctive relief claims in TFT-LCD price-fixing action can proceed, (Jun 5, 2014)

By Linda O’Brien, J.D., LL.M.

The federal district court in San Francisco has refused to dismiss retailer Home Depot’s claims under California’s Cartwright Act and for injunctive relief in a class action against manufacturers of thin-film transistor liquid crystal display panels for conspiring to fix prices. However, the retailer’s claim for damages under the Sherman Act was dismissed for lack of standing (In re TFT-LCD (Flat Panel) Antitrust Litigation, June 4, 2014, Illston, S.).

Home Depot filed suit against manufacturer AU Optronics Corporation and its subsidiary, AU Optronics Corporation America, for their role in a conspiracy to fix the prices of thin-film transistor liquid crystal display panels (TFT-LCDs) that were incorporated into LCD products sold throughout the United States. The retailer alleged that AU and other manufacturers conspired to fix, raise, and maintain the prices for LCD panels in violation of the Sherman Act and California’s Cartwright Act. AU moved to dismiss the complaint.

Injunctive relief. The court found that Home Depot could proceed with its claim for injunctive relief. The retailer met its burden of alleging the possibility of a continuing anticompetitive conspiracy. Home Depot asserted that the industry had high barriers to entry for new competitors and the court could not conclude at the pleading stage that there was no set of facts under which the retailer could succeed in its claim for injunctive relief. However, the retailer lacked standing to pursue damages for violation of the Sherman Act, since it was only an indirect purchaser of TFT-LCD components, the court determined.

Cartwright Act. AU contended that Home Depot’s Cartwright Act claim was barred by the statute of limitations. Claims under the Cartwright Act are subject to a four-year statute of limitations. According to the court, the retailer’s claims were tolled until December 2006 based on the doctrine of fraudulent concealment pursuant to a previous court ruling. The claims were also tolled for certain time periods beginning in 2007 when indirect purchaser class action complaints were filed until Home Depot opted out in April 2012. A private tolling agreement between the parties remained in effect from March until October 2013. The retailer filed its complaint in December 2013. The court noted that from December 2006 until December 2013, the statute of limitations ran for 418 days which was well below the four-year limit. Thus, the retailer’s Cartwright Act claim was not time-barred, the court concluded.

The case is No. 07-1827 SI (MDL No. 1827).

Attorneys: George Patrick Watson (Bryan Cave LLP) for Home Depot USA, Inc. Carl Lawrence Blumenstein (Nossaman LLP) for AU Optronics Corporation and AU Optronics Corporation America, Inc.

Companies: Home Depot U.S.A.; AU Optronics Corporation; AU Optronics Corporation America, Inc.

Cases: Antitrust CaliforniaNews