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Lorix v. Crompton Corp.

Supreme Court of Minnesota

August 2, 2007, Filed

A05-2148

Opinion

 [*622]  Heard, considered, and decided by the court en banc.

ANDERSON, G. BARRY, Justice.

Plaintiff, a consumer, brought a class action lawsuit under Minnesota antitrust law alleging that she paid more for tires as a result of defendants' conspiracy to fix the prices of rubber-processing chemicals. The district court granted defendants' motion to dismiss on the pleadings for lack of standing, and the court of appeals affirmed. We reverse and hold that the plaintiff has standing to sue under Minn. Stat. § 325D.57 (2006).

In this antitrust class action, Plaintiff Diane Lorix alleges that defendants Crompton Corporation, Uniroyal Chemical Company, Inc., Uniroyal Chemical Company, Limited, Flexsys NV, Flexsys America LP, Bayer AG, Bayer Corporation, Rhein Chemie Rheinau GmbH, and Rhein Chemie Corporation (collectively "Crompton"),  [**2] manufacturers of rubber-processing chemicals, agreed to fix the prices of chemicals sold to tire manufacturers. Price fixing is a violation of Minnesota antitrust law. Minn. Stat. § 325D.53, subd. 1(1)(a) (2006). Lorix alleges that she, along with the rest of the putative class, purchased tires manufactured using the price-fixed chemicals and that she paid more for the tires than she would have in the absence of the anticompetitive agreement. Lorix's complaint asserts that she purchased tires "manufactured using rubber processing materials sold by Defendants." Lorix stated at oral argument that she does not know whether the chemicals are present in the tires she purchased or were consumed in the manufacturing  [*623]  process, and that discovery would provide an answer to that question.

This lawsuit is one of several filed in state courts across the country against manufacturers of rubber-processing chemicals, sparked by government investigations into price fixing in Europe and the United States. Some of the defendants pleaded guilty in criminal cases and paid criminal fines. See Moniz v. Bayer Corp., 484 F. Supp. 2d 228, 229 (D. Mass. 2007); Crouch v. Crompton Corp., Nos. 02 CVS 4375, 03 CVS 2514, 2004 NCBC 7, 2004 NCBC LEXIS 6, 2004 WL 2414027, at *20 (N.C. Super. Oct. 28, 2004). [**3]  Direct purchasers of rubber processing chemicals have also filed a nationwide class action suit against manufacturers of rubber-processing chemicals. See In re Rubber Chems. Antitrust Litig., 232 F.R.D. 346, 355 (N.D. Cal. 2005) (granting plaintiffs' motion for class certification).

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736 N.W.2d 619 *; 2007 Minn. LEXIS 444 **; 2007-2 Trade Cas. (CCH) P75,815

Diane Lorix, individually and on behalf of all others similarly situated, Appellant, vs. Crompton Corporation, et al., Respondents, Flexsys NV, et al., Defendants, Bayer Corporation, Defendant.

Prior History:  [**1] Court of Appeals.

Lorix v. Crompton Corp., 720 N.W.2d 15, 2006 Minn. App. LEXIS 122 (2006).

Disposition: Reversed and remanded.

CORE TERMS

antitrust, indirect, consumer, manufactured, overcharge, chemicals, price-fixed, tires, speculative, restrained, remote, duplicative, competitor, anticompetitive, conspiracy, middlemen, tobacco, chain, pass-on, Shoe

Antitrust & Trade Law, Private Actions, Standing, General Overview, Civil Procedure, Appeals, Standards of Review, De Novo Review, Judgments, Pretrial Judgments, Judgment on Pleadings, Governments, Legislation, Interpretation, Regulated Practices, Justiciability, Clayton Act, Trade Practices & Unfair Competition, State Regulation, Requirements, Courts, Judicial Precedent, Price Fixing & Restraints of Trade, State Regulation, Evidence, Burdens of Proof, Allocation