Case 3:14-cv-03264-JD Document 1302 Filed 09/30/16 Page 1 of 14
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`Master File No. 14-cv-03264-JD
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`ORDER RE PHASE I OF SUMMARY
`JUDGMENT ON FOREIGN
`TRANSACTIONS
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`IN RE CAPACITORS ANTITRUST
`LITIGATION.
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`This order resolves legal disputes between the parties about the application of Section 6a
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`of the Foreign Trade Antitrust Improvements Act, 15 U.S.C. § 6a (“FTAIA”), in this case. Dkt.
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`Nos. 911, 915. After additional briefing and submission of evidence by the parties, the Court will
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`issue a Phase II order that will constitute the final decision on defendants’ motions for summary
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`judgment.
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`BACKGROUND
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`In these consolidated antitrust class actions, plaintiffs are direct and indirect purchasers of
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`capacitors, a small component used to store and even out the flow of energy in electronic devices.
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`See Dkt. Nos. 710, 1003. Capacitors are a basic building block of electrical devices and it is no
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`exaggeration to say that they are present in virtually every electronic device in the world. The gist
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`of the complaints is that the defendants, who “dominate” the highly concentrated markets for
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`electrolytic and film capacitors, conspired to fix prices and suppress competition in those markets.
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`See Dkt. Nos. 799-4, 1112. Defendants are mainly overseas manufacturers operating in Japan and
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`other parts of East Asia.
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`Given the international bent of the allegations, the parties and the Court recognized from
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`the start that the FTAIA would play a pivotal role in this case. As is often noted, the FTAIA is an
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`“inelegantly phrased” statute. Animal Science Products, Inc. v. China Minmetals Corp., 654 F.3d
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`Case 3:14-cv-03264-JD Document 1302 Filed 09/30/16 Page 2 of 14
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`462, 465 (3d Cir. 2011); see also United States v. Hsiung, 778 F.3d 738, 751 (9th Cir. 2015) (“a
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`web of words”). The intent behind the statute is not the complicating factor. Congress’s goal was
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`to assure American companies that they would not be liable under the Sherman Act for conduct
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`that typically would be considered anticompetitive so long as that conduct adversely affected
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`foreign markets only. F. Hoffmann-La Roche Ltd. v. Empagran S.A., 542 U.S. 155, 161 (2004)
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`(“Empagran I”) (citing H.R. Rep. No. 97-686 at 1-3, 9-10 (1982)). As the Supreme Court has
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`held, the FTAIA removes overseas transactions and business arrangements from the purview of
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`the Sherman Act “unless those activities adversely affect domestic commerce, imports to the
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`United States, or exporting activities of one engaged in such activities within the United States.”
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`Id. (emphasis in original).
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`The challenge of the FTAIA is applying Congress’s intent to the myriad of complex
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`business practices found in the global economy. This task has bedeviled the courts. The Supreme
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`Court has not addressed the FTAIA since Empagran I in 2004, and circuit and district court
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`decisions often differ, sometimes sharply, over basic provisions of the FTAIA. See, e.g., Hsiung,
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`778 F.3d at 758 n.9 (noting disagreement between Ninth Circuit, and Second and Seventh
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`Circuits, over definition of “direct” in Section 6a(1)). The extraterritorial reach of the Sherman
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`Act remains far from obvious in the case law.
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`The facts pertinent to the FTAIA add to the complexity of applying it. They typically
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`consist of gigabytes of transactional data, emails, contracts and other business documents for each
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`individual defendant, along with scores of witness depositions, all subject to language translation
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`challenges. Economists and other consultants are often retained to help manage and understand
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`these vast data sets, and inevitably add their own voluminous expert reports and deposition
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`testimony.
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`All of this can make cases with a serious FTAIA component a time and money sinkhole
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`for the litigants. The typical case management schedule exacerbates the problem by tending to
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`defer FTAIA determinations until late in the case and after years of staggeringly costly
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`multinational discovery.
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`After discussions with the parties, the Court decided to address the FTAIA issues sooner
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`rather than later in the case. The goal was to resolve the parties’ FTAIA disagreements early
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`enough to realize downstream efficiencies and economies in discovery and class certification and
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`other motions. Early resolution might also help to spur settlement talks. To these ends, the Court
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`set a separate and early briefing track for FTAIA issues. After an initial round of briefs on this
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`track, it became clear that a phased approach would simplify and clarify resolution of the FTAIA
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`questions.
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`This order decides the first phase, which focuses on the parties’ disagreements about the
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`scope of the import exclusion and proximate cause for the domestic effects exception to the
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`FTAIA. See Fed. R. Civ. P. 56 Advisory Committee Notes to the 1946 Amendment (partial
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`summary judgment under the rule may be “a pretrial adjudication that certain issues shall be
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`deemed established for the trial of the case. This adjudication is more nearly akin to the
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`preliminary order under Rule 16, and likewise serves the purpose of speeding up litigation by
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`eliminating before trial matters wherein there is no genuine issue of fact”); Allen v. C & H
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`Distributors, LLC, No. 10-1604, 2013 WL 4506233, at *2 (W.D. La. Aug. 22, 2013) (Rule 56
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`proper vehicle for determining applicable law). The second phase will apply these legal
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`determinations to the record and end in a final order on defendants’ requests for summary
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`judgment under the FTAIA. The parties’ next steps are detailed in the Conclusion.
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`DISCUSSION
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`This consolidated case involves multiple groups of plaintiffs, close to two dozen
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`defendants, and more than a decade of alleged conspiratorial conduct. There are two operative
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`complaints. One presents the claims of the direct purchaser plaintiffs, which consists of
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`(1) entities who seek to proceed as a class, i.e., the Direct Purchaser Plaintiffs (“DPPs”), and
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`(2) Flextronics International USA, Inc. (“Flextronics”), which has opted to proceed on an
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`individual, non-class basis. Dkt. No. 799-4. The other operative complaint is the fourth
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`consolidated complaint filed by the indirect purchaser plaintiffs (“IPPs”). Dkt. No. 1112. The
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`IPPs are individuals and companies who purchased stand-alone capacitors from distributors, who
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`in turn purchased those capacitors from defendants. Id. ¶¶ 29-39. The IPPs do not include any
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`Case 3:14-cv-03264-JD Document 1302 Filed 09/30/16 Page 4 of 14
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`consumers who purchased finished goods incorporating capacitors. Plaintiffs in that category
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`were voluntarily dismissed without prejudice earlier in the case. Dkt. No. 710 at 3-4. Defendants
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`for both complaints are mostly foreign corporations that manufacture capacitors and are alleged to
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`have participated in a global price-fixing conspiracy spanning over a decade.
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`The FTAIA is pivotal here because it limits the extraterritorial reach of Section 1 of the
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`Sherman Act, 15 U.S.C. § 1, which prohibits conspiracies “in restraint of trade or commerce
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`among the several States, or with foreign nations.” A claim under Section 1 of the Sherman Act is
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`the only claim DPPs have alleged against defendants. Dkt. No. 799-4 ¶¶ 433-443. Flextronics
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`joins in alleging the same claim and adds claims under California’s Cartwright Act (Cal. Bus. &
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`Prof. Code § 16720) and Unfair Competition Law (Cal. Bus. & Prof. Code § 17200). Id. ¶¶ 433-
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`469. The IPPs allege claims under (1) Section 1 of the Sherman Act (for injunctive relief only),
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`(2) state antitrust and restraint of trade claims under the laws of California, Iowa, Michigan,
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`Minnesota, Nebraska and New York, and (3) state consumer protection and unfair competition
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`claims under the laws of California, Florida, Nebraska and New York. Dkt. No. 1112 ¶¶ 381-419.
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`In our circuit, it is now settled that the limitations imposed by the FTAIA are not
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`jurisdictional but go to the merits of a Sherman Act claim. Hsiung, 778 F.3d at 751. The FTAIA
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`“boils down to two principles.” Id. “Import trade or import commerce” with foreign nations falls
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`squarely within the scope of the Sherman Act and is excluded from the FTAIA altogether. Id.
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`“Nonimport trade or commerce with foreign nations,” on the other hand, is subject to the FTAIA
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`and is not governed by the Sherman Act unless it meets the “domestic effects exception.” Id. at
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`756. To meet the exception, (1) the conduct must have had a “direct, substantial and reasonably
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`foreseeable effect” on U.S. domestic commerce, and (2) such U.S. domestic effect must “give[]
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`rise to” a Sherman Act claim. 15 U.S.C. § 6a; see also In re Dynamic Random Access Memory
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`(DRAM) Antitrust Litigation, 546 F.3d 981, 985-86 (9th Cir. 2008).
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`I. DPPS’ AND FLEXTRONICS’ ALLEGATIONS
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`The parties’ main dispute under the FTAIA for the direct purchasers’ allegations are the
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`scope of commerce that constitutes “import trade or import commerce,” and the scope of
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`nonimport trade or commerce that satisfies the domestic effects exception (and the second prong
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`of that exception in particular). The Court resolves these disputes by category of transaction.
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`A. Capacitors Billed To Entities In The U.S.
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`The parties agree that capacitor sales billed to entities in the United States are not
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`excluded by the FTAIA regardless of where the products were ultimately delivered. See, e.g., Dkt.
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`No. 915 at 4 (defendants’ request for an order “limiting the sales at issue in the instant action to
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`sales invoiced directly to U.S.-located customers as reflected in Defendants’ transaction data”).
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`These transactions are within this case.
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`B. Capacitors Billed To Foreign Entities But Shipped To The U.S. -- Scope Of
`“Import Trade Or Commerce”
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`The parties disagree about capacitors billed to foreign entities but which defendants
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`shipped to the United States. Dkt. No. 967-5 at 5-13; Dkt. No. 983-5. This category of
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`transactions presents the question of what constitutes import trade or commerce. Plaintiffs take
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`the position that “[t]he capacitors that defendants shipped to U.S. entities are import commerce,”
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`Dkt. No. 967-5 at 5, and fall “within the Sherman Act without further clarification or pleading.”
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`Hsiung, 778 F.3d at 754.
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`While “our circuit has not defined ‘import trade’ for purposes of the FTAIA,” it has held
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`that “not much imagination is required to say that this phrase means precisely what it says.”
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`Hsiung, 778 F.3d at 754-55. The Ninth Circuit readily found in Hsiung that “transactions between
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`the foreign defendant producers of TFT-LCDs and purchasers located in the United States” were
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`import trade because the defendants had “sold” TFT-LCD panels to customers in the United
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`States. Id. at 756 (“Trial testimony established that AUO imported over one million price-fixed
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`panels per month into the United States. . . . The panels were sold into the United States, falling
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`squarely within the scope of the Sherman Act.”). But Hsiung does not tackle the issue presented
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`here, where a product was billed to an entity abroad but delivered to the United States.
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`Other courts have expressly addressed this situation. In Animal Science, for example, the
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`Third Circuit held that functioning as a physical importer was not a mandatory condition for
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`satisfying the import trade or commerce exception. “Rather, the relevant inquiry is whether the
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`defendants’ alleged anticompetitive behavior ‘was directed at an import market.’” Animal
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`Science, 654 F.3d at 470 (internal citation omitted). The court also found “the delivery location of
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`goods sold by a foreign seller to be relevant to whether that seller’s actions were directed at a
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`United States import market,” and directed the district court on remand to give weight to well-pled
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`allegations that the defendants in the case had “made direct sales of magnesite for delivery in the
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`United States during the time period of the alleged conspiracy.” Id. at 471 n.11; see also Fond du
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`Lac Bumper Exchange, Inc. v. Jui Li Enterprise Co., Ltd., 795 F. Supp. 2d 847, 850-51 (E.D. Wis.
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`2011) (even if defendants “transferred title to the [aftermarket auto] parts to plaintiffs in Taiwan
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`and did not themselves ship the parts into the United States, by allegedly agreeing to fix the prices
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`of parts to be sold in the United States and taking the additional steps” such as delivering “the
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`parts to their ships for transport to the United States” and bringing parts into the United States,
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`“defendants’ conduct involved import commerce.”).1
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`Here, the undisputed facts for the transactions in this category are that defendants invoiced
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`capacitor sales to a foreign purchaser but directly shipped the capacitors to a location in the United
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`States. See Dkt. No. 983-5 at 2; Dkt. No. 967-5 at 5-8. Defendants not only knew and intended
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`that the goods would be delivered to the United States, they themselves shipped them here. The
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`complaint alleges import trade directed toward the United States, Dkt. No. 799-4 ¶¶ 8, 9, 13, 212,
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`and plaintiffs have submitted evidence indicating that defendants’ alleged conspiracy focused on
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`the U.S. market, evidence defendants do not contest for purposes of this motion. Dkt. No. 1076 at
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`10. Consequently, the transactions in this category qualify as import trade or commerce.
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`This holding is consonant with Hsiung. Our circuit declined to “determine the outer
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`bounds of import trade,” but it did expressly take note of the Third Circuit’s test that “the import
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`1 Plaintiffs rely heavily on In re Vitamin C Antitrust Litigation, 904 F. Supp. 2d 310 (E.D.N.Y.
`2012), for similar reasoning. In that case, “[b]oth parties agree[d] that the vitamin C at issue was
`bought overseas by foreign purchasers and shipped into the United States.” Id. at 316-17. The
`trial court held that the “relevant inquiry is whether the defendants’ alleged anticompetitive
`behavior ‘was directed at an import market,’” and concluded that it was because the complaint
`alleged conspiracy meetings and conversations “in which the price, volume of sales and exports to
`the United States, and markets for vitamins were discussed and agreed upon.” Id. But the Second
`Circuit recently vacated the judgment in the case and remanded it for dismissal after concluding
`that the trial court should have declined jurisdiction under principles of international comity. In re
`Vitamin C Antitrust Litig., No. 13-4791-cv, 2016 WL 5017312 (2d Cir. Sept. 20, 2016).
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`trade exclusion . . . applies to importers and to defendants whose ‘conduct is directed at a U.S.
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`import market,’ even if the defendants did not engage in importation of products into the United
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`States.” 778 F.3d at 755 n.8. While Hsiung also held that “[t]argeting is not a legal element for
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`import trade under the Sherman Act,” there is no question that the court considered those kinds of
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`allegations to be relevant to the import trade analysis, as it went on to note that “[i]n any event, the
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`negotiations in the United States and the significant direct sales to the United States certainly
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`qualify as targeting.” Id. at 756; see also id. at 755-56 (“These allegations directly describe that
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`the defendants and their coconspirators engaged in import commerce with the United States --
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`indeed, the conspiracy’s intent, as alleged, was to ‘suppress and eliminate competition’ by fixing
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`the prices for panels that AUO and AUOA sold to manufacturers ‘in the United States and
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`elsewhere’ for incorporation into retail technology sold to consumers in the United States and
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`elsewhere.”).2
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`And harkening back to Hsiung’s observation that import trade is not always that hard to
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`fathom, the Court notes plaintiffs’ proffer of a dictionary definition of “import,” which they say
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`means “to bring (as merchandise) into a place or country from another country.” Dkt. No. 967-5
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`at 5 (citing the Merriam-Webster Dictionary at http://www.merriam-webster.com/dictionary/
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`import). This is a straightforward and commonsense definition of “import,” and it is difficult to
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`see how directly shipping a product to the United States would not fit within it.
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`Defendants do not offer a meaningful rebuttal to any of these points. Consequently, the
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`Court finds that sales of capacitors by defendants that were invoiced to a foreign purchaser but
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`shipped by a defendant to a location in the United States counts as “import trade or import
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`commerce,” is subject to the Sherman Act and is a part of this case.
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`The Court declines at this time to consider whether the domestic effects exception also
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`applies to this category of trade. Plaintiffs say the exception fits here, Dkt. No. 967-5 at 8-13, and
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`some courts have considered that question even after applying the import exclusion. See, e.g.,
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`2 Interestingly, the circuit also approved a jury instruction in Hsiung which included the element
`that “the members of the conspiracy engaged in one or both of the following activities: (A) fixing
`the price of TFT-LCD panels targeted by the participants to be sold in the United States or for
`delivery to the United States . . . .” 778 F.3d at 748 (emphasis added).
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`Fond du Lac, 795 F. Supp. 2d at 851. But the Court’s finding on the import trade question makes
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`this additional step unnecessary.
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`C. Capacitors Billed And Shipped To A Foreign Entity -- Proximate Cause Under
`The Domestic Effects Exception
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`The category of capacitors that were billed and shipped to a foreign entity raises the
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`question of FTAIA’s domestic effects exception and its causation requirement. To meet the
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`domestic effects exception and come within the scope of the Sherman Act, the nonimport trade or
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`commerce conduct must have had a “direct, substantial and reasonably foreseeable” effect on U.S.
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`domestic commerce, and this domestic effect must have “given rise to” the Sherman Act claim.
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`15 U.S.C. § 6a; see also DRAM, 546 F.3d at 985-86. Defendants focus mainly on the causation
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`element. Dkt. No. 915 at 17-23.
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`Defendants acknowledge that proximate cause is the applicable test in our circuit, see
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`DRAM, 546 F.3d at 987, but go on to strangle it with unreasonable geographic strictures. They
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`say that “[t]here is simply no basis for the DPPs and Flextronics USA to argue that where foreign
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`purchasers pay supra-competitive prices overseas as a result of the alleged conspiracy, those
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`foreign effects are proximately caused by U.S. anticompetitive effects that ‘give rise to’ the
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`foreign purchaser impact.” Dkt. No. 983-5 at 9; see also id. at 3 (“such transactions cannot, as a
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`matter of law, satisfy the ‘gives rise to’ requirement of the FTAIA”).
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`Defendants go too far. The locus of a transaction is not dispositive under the FTAIA. As
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`the District of Columbia Circuit held in rejecting a similar argument:
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`The appellees suggest that the exception applies only to injuries that
`arise in U.S. commerce, thus describing its reach by the situs of the
`transaction and resulting injuries rather than by the situs of the
`effects of the allegedly anti-competitive conduct giving rise to the
`appellants’ claims. This interpretation has no support from the text
`of the statute, which expressly covers conduct involving “trade or
`commerce with foreign nations.” 15 U.S.C. § 6a(1)(A). In addition,
`the legislative history makes clear that the FTAIA’s “domestic
`effects” requirement “does not exclude all persons injured abroad
`from recovering under the antitrust laws of the United States.”
`H.R.Rep. No. 97-686, at 17a. The appellants need only demonstrate
`therefore that the U.S. effects of the appellees’ allegedly anti-
`competitive conduct “g[a]ve rise to” their claims.
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`Empagran S.A. v. F. Hoffmann-Laroche, Ltd., 417 F.3d 1267, 1269 (D.C. Cir. 2005) (“Empagran
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`II”) (emphasis added). The FTAIA does not state or support a per se rule excluding foreign
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`purchasers just because they did their buying abroad.
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`The cases defendants rely on do not support a different conclusion. Defendants say that
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`Empagran I and DRAM “express unambiguously that in price-fixing class actions where foreign
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`purchasers seek damages arising from direct purchases of a product sold outside the United States
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`by foreign defendants, those purchasers’ alleged injuries were caused independently from any
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`effect on U.S. commerce and thus such claims are barred by the FTAIA.” Dkt. No. 915 at 18. But
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`these cases do not stand for the proposition defendants urge. In Empagran I, it was “assumed that
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`the foreign effect, i.e., higher prices in Ukraine, Panama, Australia, and Ecuador, was independent
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`of the domestic effect, i.e., higher domestic prices.” 542 U.S. at 160; see also id. at 164 (“we
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`reemphasize that we base our decision upon the following: The price-fixing conduct significantly
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`and adversely affects both customers outside the United States and customers within the United
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`States, but the adverse foreign effect is independent of any adverse domestic effect.”). The
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`Supreme Court declined to address in the first instance the alternative argument “that the foreign
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`injury was not independent,” stating that respondents “remain[ed] free to ask the Court of Appeals
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`to consider the claim” on remand. Id. at 175. On remand, the Court of Appeals for the District of
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`Columbia Circuit did conclude that there was a lack of proximate cause (such that the second
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`prong of the FTAIA’s domestic effects exception was not met after all), but not simply because
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`appellants were foreign corporations that had purchased vitamin products outside of the United
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`States. Empagran II, 417 F.3d at 1268-70.
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`So, too, in DRAM. The plaintiff-appellant was a British corporation that had “purchased
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`DRAM outside of the United States from the defendants, various [computer] memory companies.”
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`546 F.3d at 984. The court held that plaintiff “Centerprise has not shown that the higher U.S.
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`prices proximately caused its foreign injury of having to pay higher prices abroad. Other actors or
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`forces may have affected the foreign prices.” Id. at 988. Significantly, the court found it merely
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`“notabl[e]” that Centerprise was “a foreign consumer that made its purchases entirely outside of
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`the United States.” Id. at 989. This observation did not drive the court’s decision. Instead, what
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`the court found was that even “a direct correlation between prices [in the U.S. and prices abroad]
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`does not establish a sufficient causal relationship.” Id. More specifically, the court held that, for
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`the allegation “that the defendants’ activities resulted in the U.S. prices setting the worldwide
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`price,” plaintiff had “not set forth a theory with any specificity of how this price-setting occurred
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`or how it shows a direct causal relationship.” Id. at 990.
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`As all of this shows, these cases turned on failures of pleading and proof specific to them.
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`They do not stand for a bright line rule, as defendants contend, that no foreign plaintiff alleging a
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`global conspiracy can ever satisfy the “gives rise to” prong of the FTAIA domestic effects
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`exception.
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`But this is not to say that plaintiffs’ interpretation of proximate cause is significantly better.
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`Plaintiffs argue for a “global pricing” theory of proximate cause based on the idea that “the
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`domestic effects of defendants’ conduct gave rise to plaintiffs’ claims where defendants made
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`sales to a U.S. corporate family member and to a foreign corporate family member as part of a
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`global pricing system.” Dkt. No. 967-5 at 14-17. The problem with this theory is that it is
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`analytically indistinguishable from similar theories that have already failed in court, most critically
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`in the Ninth Circuit. See DRAM, 546 F.3d at 989-90 (“Centerprise’s complaint suggests that
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`super-competitive DRAM prices in the United States may have facilitated the defendants’ scheme
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`to charge super-competitive prices abroad, but it does not sufficiently allege a theory that the
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`higher U.S. prices proximately caused Centerprise’s foreign injury of having to pay higher prices
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`outside the United States,” and “[s]imilar arguments were made and rejected in Empagran II and
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`In re Monosodium Glutamate -- that there was a single global price kept in equipoise by the
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`maintenance of super-competitive prices in the U.S. market.”).
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`And as Empagran II found, “[w]hile maintaining super-competitive prices in the United
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`States may have facilitated the appellees’ scheme to charge comparable prices abroad, this fact
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`demonstrates at most but-for causation. It does not establish . . . that the U.S. effects of the
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`appellees’ conduct -- i.e., increased prices in the United States -- proximately caused the foreign
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`appellants’ injuries.” 417 F.3d at 1271. That holding applies with equal force here. Plaintiffs’
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`global pricing theory is rejected as a matter of law.
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`Going forward in this case, the Sherman Act claims of foreign purchasers who were
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`invoiced and received their capacitors abroad are not barred as a matter of law, but they may not
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`allege a claim on the basis of a global pricing theory. While DRAM likely leaves only a small
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`opening for plaintiffs to establish proximate cause in this category, they are certainly free to
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`proffer facts in Phase II showing that they can get through the eye of that needle.
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`D. Capacitors Incorporated Into Products Destined For Sale In The United States
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`Flextronics’ allegations raise another category of trade: capacitors that were
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`manufactured abroad and incorporated abroad into finished products destined for sale in the
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`United States. Hsiung suggests, without definitively stating, that transactions like this may come
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`within the Sherman Act either as import trade or under the domestic effects exception. For the
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`“[f]oreign sales of panels that were incorporated into finished consumer products ultimately sold
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`in the United States,” the court noted that the parties acknowledged the conduct was both
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`substantial and had a reasonably foreseeable impact on the United States, and the court went on to
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`find that the impact was also sufficiently “direct,” thereby satisfying the first prong of the
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`domestic effects exception. 778 F.3d at 758-59. An important part of the court’s holding was that
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`TFT-LCDs were a “substantial cost component of the finished products,” and it was “well
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`understood that substantial numbers of finished products were destined for the United States and
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`that the practical upshot of the conspiracy would be and was increased prices to customers in the
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`United States.” Id. at 759. None of that fits well here, where the parties agree that capacitors are
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`tiny parts that cost pennies or less to buy, and are unlikely to be a substantial cost component of
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`finished products even when used in volume.
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`Another wrinkle for this category is that Hsiung was a criminal case brought by the United
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`States government. Because the government was not seeking civil monetary damages, Hsiung had
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`no need to address the second prong of the domestic effects exception. That is quite different from
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`this civil damages case, which makes it difficult to apply the broader statements in Hsiung. The
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`challenge is compounded by the fact Hsiung did not turn on the domestic effects exception. After
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`finding that the first prong of the exception had been satisfied, the court stated that “even
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`disregarding the domestic effects exception, the evidence that the defendants engaged in import
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`trade was overwhelming . . . [and the] evidence offered in support of the import trade theory alone
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`was sufficient to convict the defendants of price-fixing in violation of the Sherman Act.” Id. at
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`760.
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`In any event, the ultimate legal disposition of this category will depend on the facts, which
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`are far from undisputed here. The Court leaves this category for further development and
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`resolution in Phase II or later stages of the case. The parties are advised to consider the discussion
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`of Hsiung when returning to this category in future motions.
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`This concludes the Court’s treatment of the transaction categories raised by the direct
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`purchaser plaintiffs’ allegations as briefed by the parties. Defendants made a passing gesture at
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`arguing that the direct purchaser plaintiffs cannot recover under Illinois Brick Co. v. Illinois, 431
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`U.S. 720 (1977), for “purchases of capacitors or finished goods containing capacitors from their
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`foreign affiliates who purchased the capacitors directly from defendants.” Dkt. No. 915 at 24-26.
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`The intersection of Illinois Brick and the FTAIA is a complex topic and the Court declines to
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`address it at this stage in light of the cursory briefing and underdeveloped factual record presently
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`before it.
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`II. IPPS’ ALLEGATIONS
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`The fundamental dispute on the IPP side of the case is whether the FTAIA applies to the
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`state antitrust and consumer protection claims alleged by the IPPs. Defendants say that the “state
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`law claims are governed by the extraterritorial limitations imposed by the FTAIA,” which bar
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`“claims that involve standalone capacitors first sold outside the United States to a third-party
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`distributor that is not an alleged conspirator.” Dkt. No. 911 at 1, 5.
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`Both sides frame the discussion in terms of the application of the federal FTAIA statu