Few issues have proven more vexing to private antitrust enforcement than those related to indirect-purchaser class actions. The current dual system of enforcement—federal and state—exacerbates the difficulty of litigating indirect-purchaser claims by layering procedural complexity on top of substantive complexity and by explicitly allowing (perhaps even incentivizing) duplicative recovery. Almost all commentators are in substantial agreement that reform is necessary, but Congress appears unlikely to take action on the issue in the near future. This Note proposes a procedural solution that would consolidate litigation in a single federal court based on the limited-fund class action model of Federal Rule of Civil Procedure 23(b)(1)(B). Under the limited-fund model, the purpose of consolidated litigation is to determine liability before turning to the apportionment of damages. This Note also advocates for a presumption that damages are appropriately allocated to purchasers on a pro rata basis, consistent with common practice in the limited-fund class action context. Proper allocation would depend on the purchaser’s position in the supply chain, with direct purchasers receiving the largest share of the recovery. This Note’s proposal provides three primary advantages: (1) it eliminates the possibility of duplicative litigation; (2) it aligns the interests of all the potential plaintiffs to better incentivize vigorous antitrust enforcement; and (3) it reduces the need for complex damages calculations.
November 2015, Vol. 67, No. 6
Liesa L. Richter, Posnerian Hearsay: Slaying the Discretion Dragon
Sapna Kumar, Regulating Digital Trade
W. Keith Robinson, Economic Theory, Divided Infringement, and Enforcing Interactive Patents
Sandra F. Sperino, Retaliation and the Reasonable Person