Antitrust class actions: chaos in the courts

• Author: Robert H. Klonoff
• Pages: 137-164

ANTITRUST CLASS

ACTIONS

CHAOS

IN THE

COURTS

Robert

H.

Klonoff*

A.

INTRODUCTION

In an

insightful article, Professor Samuel

Issacharoff

observed that class

actions

can be

roughly divided into

two

categories: "upstream" cases,

which involve

an

alleged "uniform course

of

conduct

by the

defendant,

from

which

everything else follows,"

and

"downstream"

cases,

in

which

the

resolution

of a

common issue results

in "an

immediate need

to

shift

downstream

and

find fact after fact

with regard

to

each individual plain-

tiff."1

Professor

Issacharoff

identified,

as

classic upstream cases, those

involving economic harm

and

damages that generally

can be

"calculated

administratively."2

He

identified,

as

classic downstream

cases,

personal

injury

mass tort claims, which typically involve myriad individualized

issues.3

Antitrust cases

often

pose

a

dilemma under

this

dichotomy. They

are

obviously economic cases,

and

they

frequently

involve

a

significant com-

mon

issue, such

as

whether

the

defendants engaged

in a

conspiracy

to

restrain trade

or

whether

the

alleged conspiracy caused class-wide

injury.

*

Douglas

Stripp/Missouri

Professor

of

Law, University

of

Missouri-Kansas City

School

of

Law; co-author

of

Class

Actions

and

Other

Multi-Party

Litigation:

Cases

and

Materials

(St.

Paul,

Minn.:

Thomson West, 2000)

(2nd

ed.

forth-

coming

2006);

author

of

Class Actions

and

Other

Multi-Party

Litigation

in a

Nutshell,

2nd ed.

(St.

Paul,

Minn.:

Thomson West, 2004);

and an

Associate

Reporter

for the

American

Law

Institute's "Principles

of the Law of

Aggregate

Litigation."

I

thank Matthew Allen, James Eiszner, Edwin Fountain, Professor

Mark

Herrmann, Charles Morse, Professor Suzette Malveaux,

and the

partici-

pants

at the

Western

Law

competition class action symposium,

who

provided

useful

comments

on an

earlier version

of

this article.

I

also thank

Zhaoying

Du,

Nicole

Fisher, Desarae Harrah, Heather Ingram-Gipson,

and

Ruzhen

Wei for

their excellent support.

1

Samuel

Issacharoff,

"Class Action

Conflicts"

(1997)

30

U.C. Davis

L.

Rev.

805

at

831-32.

2

Ibid,

at

832.

3

Ibid.

137

On

the

other hand, antitrust class actions sometimes involve complicated,

highly individualized issues relating

to

injury

and

damages. They

do not

always

fit

neatly into either

the

"upstream"

or

"downstream" model.

Not

surprisingly, therefore,

the

case

law is in

disarray.

This

disarray

has

manifested itself

in at

least

four

ways. First, some

courts invoke

a

special presumption

in

favour

of

class certification

in

antitrust cases; other courts

do

not.4

Second, some courts require plain-

tiffs

to put

forward

a

specific

plan

as to how an

antitrust

class

action

will

be

tried; others

do not and

simply

certify

without resolving

how the

case

will

be

tried.5

Third, courts

in

antitrust cases

differ

with respect

to the

weight given

to

expert testimony: some courts look only

at the

plaintiffs'

proffered

testimony

and

virtually always accept

it as

sufficient

for

pur-

poses

of

class certification; others adopt

a

more exacting approach

and

assess

the

parties' expert testimony with care

before

ruling

on

certifica-

tion.6

Fourth, some courts adopt

a

blanket rule that individualized dam-

ages

in

antitrust cases

do not

defeat

class certification; others eschew

any

such rule

and

instead look

at the

circumstances

of the

particular

case.7

Surprisingly, this disarray

in

antitrust class action

law has

received little

scholarly

attention.8

4

Compare,

for

example,

In re

Lorazepam

&

Clorazepate

Antitrust Litigation,

202

ER.D.

12

(D.D.C. 2001)

at 22,

invoking

a

presumption, with

Robinson

v.

Tex.

Automobile

Dealers

Ass'n,

387 E3d 416

(5th Cir. 2004)

at 420

[Robinson],

requiring

the

court

to

"conduct

an

intense

factual

investigation"

in

connection

with class certification.

5

Compare,

for

example,

Robinson,

ibid,

at

425, requiring

a

trial plan, with

In

re

Mercedes-Benz

Antitrust

Litigation,

213

ER.D

180

(D.N.J.

2003)

at 192

[Mercedes-Benz],

certifying

a

class action without resolving

how the

case will

be

tried.

6

Compare,

for

example,

In re

Cardizem

CD

Antitrust

Litigation,

200

ER.D.

326

(E.D.

Mich. 2001)

at 348

[Cardizem],

conducting virtually

no

independent

scrutiny,

with

Weis/eld

v. Sun

Chemical

Corp.,

210

ER.D.

136

(D.N.J.

2002)

at

144

[Weis/eld],

rejecting expert testimony only

after

rigorous analysis.

7

Compare,

for

example,

In re

Magnetic

Audiotape

Antitrust

Litigation,

2001 U.S.

Dist.

LEXIS

7303

(S.D.N.Y.)

at *25

[Magnetic

Audiotape],

using

a

blanket rule

that

damages issues

do not

defeat

certification, with

Picket

v.

IBP,

Inc.,

182

ER.D.

647

(M.D. Ala.

1998),

rev'd

on

other

grounds

209 E3d

1276

(llth

Cir.

2000)

[Picket],

holding that individualized damages issues

can

render

a

class

action

unmanageable.

8 For a

noteworthy exception,

see D.

Matthew Allen

&

Chris

S.

Coutroulis,

"Back

to the

Future: Toward

a

More Rigorous Analysis

of

Antitrust Class

Actions"

(2003)

48

Antitrust Bulletin

463 at

466, arguing that "one

can

trace

the

development

of

antitrust class action jurisprudence through

four

distinct

phases." Contrast

my

position, below, where

I

argue that

conflict

in the

case

law

has

been

longstanding

and

still

persists.

138

LITIGATING

CONSPIRACY:

AN

ANALYSIS

OF

COMPETITION

CLASS

ACTIONS