On January 11, 2011, Bioelements and the California Attorney General entered into a consent decree that enjoins Bioelements from entering into any agreements with retailers and distributors concerning what price they may charge for Bioelements’ products and to send notice to all retailers and distributors that any such polices are immediately rescinded. The action was brought in California Superior Court under the Cartwright Act, which the California Attorney General has interpreted to provide per se treatment for resale price maintenance in contrast to Section 1 of the Sherman Act after Leegin. See March 12, 2010 Post. Notably, the injunction extends to all of Biolelements’ transactions even if they take place outside of California. Bioelements also had to pay $51,000 in fines and expenses. This action is a cautionary tale that companies cannot rely on Leegin that resale price maintenance will be subject to lenient rule of reason treatment. A number of state attorneys general have brought resale price maintenance actions under their state laws and Maryland amended its antitrust law expressly to prohibit resale price maintenance.
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Posted by : | On : January 5, 2011
On December 21, 2010, the United States District Court for the Northern District of California in Pecover v. Electronic Arts, Inc., No. 08-cv-02820-VRW, Dkt. #198 (N.D. Cal. Dec. 21, 2010), certified a nationwide class of consumers, who purchased Madden NFL, NCAA or Arena Football since January 1, 2005. The suit alleges that that EA’s exclusive license agreements violated the Cartwright Act. The case is important for two distinct reasons. First, the Court held that California law applied to all claims regardless of where the consumers purchased the products because of EA’s nexus to California. This is a tremendous development because it allows for a nationwide class based on a single state law and therefore eliminates conflict between different state laws, which is often a barrier to certification of nationwide class actions. Second, the Court held that the consumers provided a model that would show that they suffered common impact and therefore satisfied the predominance requirement for class certification — which can be a difficult element to satisfy. The decision appears here. ea class cert