U.S Supreme Court decline 2 Antitrust Cases

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This week Supreme Court declined to review a pair of antitrust cases involving an international price-fixing cartel, despite the advising of some legal experts, economists and the National Association of Manufacturers.

The cases came out of a federal court in San Francisco and a federal court in Chicago. While one of the cases was criminal and the other civil, they shared the same evidence, which showed how a cartel of Asian producers rigged the prices of liquid-crystal display screens used in computers and cellphones.

The San Francisco case — the criminal case — yielded guilty pleas, settlements and hundreds of millions of dollars in fines. A large Taiwanese producer that did not settle, AU Optronics, was declared and ordered to pay $500 million. Two of its executives were sent to prison.

In Chicago, a judge tossed out the follow-on civil suit by Motorola Mobility, a corporate victim of the price-fixing scheme. The judge concluded that Motorola could not sue because America’s antitrust laws did not apply to Motorola’s overseas subsidiaries, even though 42 percent of the phones they assembled were shipped to the United States

The court decisions left uncertainty and confusion, according to some antitrust experts and economists. Several of them, along with the manufacturers’ trade association, filed friend-of-the-court briefs. They argued that the Foreign Trade Antitrust Improvements Act of 1982, a decades-old law, needed a clarification to put it in step with today’s global corporations and their far-flung supply chains.

The Supreme Court, when refusing to review cases, does not provide its rationale for rejection. But by leaving both rulings intact, the court seemed to side with the federal appeals court judge, Richard A. Posner, who wrote the decision in the Chicago civil case brought by Motorola.

Judge Posner, a noted legal theorist, wrote that companies could not “pick and choose from the benefits and burdens of United States corporate citizenship” — seeking the shelter of America’s strong antitrust laws while setting up subsidiaries in low-tax overseas jurisdictions, for example. (Motorola said it had repatriated the profits from its foreign units during the years covered by the case.)

There are prominent antitrust experts who, like the Supreme Court, saw different standards in the criminal and civil cases rather than a contradiction. “There was no split here,” Herbert Hovenkamp, an antitrust expert at the University Of Iowa College Of Law, said before the Supreme Court’s decision. “Both cases were rightly decided, in my view.”