A couple weeks back the Am Law Litigation Daily blog told you about an interesting contrast in the fates of Dell and Motorola, which both opted out of the gargantuan antitrust class action against makers of liquid-crystal display screens to pursue individual cases. In an item titled “How Did Dell Succeed Where Motorola Failed?,” the blog recounted that Dell had just survived a joint defense motion to dismiss that was based on the same theory that had felled Motorola’s complaint in a parallel case against the makers of liquid-crystal display panels.
The defense motion to dismiss both cases was based on the Foreign Trade Antitrust Improvement Act, a 1982 law that restricts Sherman Act claims to exclude foreign injuries. The law was passed to protect U.S. companies from antitrust claims based on their conduct abroad, but has also proved to be quite an effective shield for defendants engaged in overseas transactions with U.S. companies.) Dell evaded the FTAIA’s restrictions by asserting that its LCD antitrust injuries aren’t strictly foreign — even though it purchased most of the liquid-crystal component parts at issue overseas — because it negotiated global purchasing agreements with the defendants at its headquarters in Texas.
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