Illinois Brick doctrine

The Illinois Brick doctrine (or Doctrine of the Illinois Brick case) is a rule of United States antitrust law that prohibits indirect purchasers of goods or services from recovering antitrust damages from antitrust violators. Thus, if manufacturer A sells bricks to contractor B who builds a house and sells it to customer C, and A engages in a price fixing conspiracy with other brick manufacturers, C cannot sue A and recover damages for the overcharges resulting from the antitrust violation. (This fact pattern is that described in the decision of the United States Supreme Court in Illinois Brick Co. v. Illinois.[1]

Contents

Supreme Court treatment of the doctrine

As indicated, the doctrine stems from the Supreme Court’s Illinois Brick decision. The Supreme Court’s rationale for the doctrine was that “multiple recovery” of the overcharge might be collected if more than one entity in the chain of distribution of the product could recover for the same violation. Many state antitrust laws reject the Illinois Brick doctrine. Thus, in California v. ARC America Corp.,[2] the Supreme Court rejected arguments that Illinois Brick preempted broader state antitrust laws such as that of California, which rejected the doctrine.

Subsequent developments

A 2007 Antitrust Modernization Commission Report proposed that Congress should abandon the Illinois Brick doctrine.[3] The proposal, if adopted, would weaken the federal right of action for direct purchasers by reviving as a defense the fact that the direct purchaser had passed on the overcharge instead of absorbing it, while creating a federal right of action for indirect purchasers. Federal rights of action under the proposal would not be exclusive, but state law claims would be subject to expanded federal jurisdiction to allow consolidation of all claims from a price fix in a single court for both discovery and trial. All recoveries in the consolidated actions would be limited to the initial overcharge, trebled.

References

  1. ^ Justia, 431 U.S. 720 (1977).
  2. ^ Justia, 490 U.S. 93 (1989).
  3. ^ The Antitrust Modernization Commission was created pursuant to the Antitrust Modernization Commission Act of 2002, Pub. L. No. 107-273, §§ 11051-60, 116 Stat. 1856. The Commission submitted its Report and Recommendations to Congress and the President on April 2, 2007. The Report and other documents relating to its work are found at its website—http://govinfo.library.unt.edu/amc/index.html.

See also

  • American Bar Association, Indirect Purchaser Litigation Handbook, ISBN 1590318684—Bar association book on legal issues raised by doctrine and how practitioners may address them
  • Entrepreneur.com, Illinois Walls: how barring indirect purchaser suits facilitates collusion--Article asserts that Illinois Brick rule facilitates collusion by allowing an upstream cartel to shield itself from private damage claims by sharing cartel profits with its direct purchasers.

Wikimedia Foundation. 2010.

Look at other dictionaries:

  • Illinois — • One of the United States of America, bounded on the north by Wisconsin, on the west by the Mississippi, which separates it from Iowa and Missouri, on the south by the confluent waters of the Mississippi and the Ohio, which separate it from… …   Catholic encyclopedia

  • Bishop Hill, Illinois — Geobox|Settlement name = Bishop Hill native name = other name = category = Village etymology = official name = motto = nickname = image caption = symbol = country = United States state = Illinois region = Henry region type = County district =… …   Wikipedia

  • United States — a republic in the N Western Hemisphere comprising 48 conterminous states, the District of Columbia, and Alaska in North America, and Hawaii in the N Pacific. 267,954,767; conterminous United States, 3,022,387 sq. mi. (7,827,982 sq. km); with… …   Universalium

  • The Church of Jesus Christ of Latter-day Saints — Classification Latter Day Saint movement Theology Nontrinitarian, Mormonism Governance …   Wikipedia

  • List of sects in the Latter Day Saint movement — Contents ♦ Before 1844 ♦ Brigham Young: Mainstream LDS  · Woolley / other fundamentalists · Progressive · Miscellaneous ♦ …   Wikipedia

  • Luther Alexander Gotwald — the fifth child of seven brothers and five sisters, the son of prominent Lutheran minister, Daniel Gotwald. He married Mary Elizabeth King after meeting her at Wittenberg College (now Wittenberg University). Gotwald died in 1900 in Springfield,… …   Wikipedia

  • Western architecture — Introduction       history of Western architecture from prehistoric Mediterranean cultures to the present.       The history of Western architecture is marked by a series of new solutions to structural problems. During the period from the… …   Universalium

  • Chronology of Mormonism — This article is part of a series on Joseph Smith …   Wikipedia

  • Anthropology and Archaeology — ▪ 2009 Introduction Anthropology       Among the key developments in 2008 in the field of physical anthropology was the discovery by a large interdisciplinary team of Spanish and American scientists in northern Spain of a partial mandible (lower… …   Universalium

  • Stephen A. Douglas — Infobox Senator name=Stephen Douglas width= 200px office=Senator from Illinois (Class 2) state= Illinois party= Democratic term start=March 4 1847 term end=June 3 1861 preceded=James Semple succeeded=Orville H. Browning party election2 = Northern …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.