Motorola, Inc. v. AU Optronics Corp.

785 F. Supp. 2d 835, 2011 U.S. Dist. LEXIS 42692
CourtDistrict Court, N.D. California
DecidedMarch 28, 2011
DocketNos. M 07-1827 SI, C 09-5840 SI; MDL No. 1827
StatusPublished
Cited by1 cases

This text of 785 F. Supp. 2d 835 (Motorola, Inc. v. AU Optronics Corp.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Motorola, Inc. v. AU Optronics Corp., 785 F. Supp. 2d 835, 2011 U.S. Dist. LEXIS 42692 (N.D. Cal. 2011).

Opinion

ORDER DENYING DEFENDANTS’ JOINT MOTION TO DISMISS THE SECOND AMENDED MOTOROLA COMPLAINT

SUSAN ILLSTON, District Judge.

On November 3, 2010, the Court held a hearing on defendants’ motion to dismiss Motorola’s second amended complaint. For the reasons set forth below, the motion is DENIED.

BACKGROUND

Plaintiff Motorola, Inc. (“Motorola”) is a technology company that is incorporated in Delaware with its principal place of business in Schaumburg, Illinois. Second Amended Complaint (“SAC”) ¶ 24. Motorola is a leading manufacturer of mobile wireless devices. Id. From January 1, 1996 until December 11, 2006 (the “Relevant Period”), Motorola manufactured products that incorporated liquid crystal [838]*838display panels (“LCD Panels”) for sale in the United States market and abroad. Id. ¶¶ 2, 26.

On October 20, 2009, Motorola filed a complaint in the Northern District of Illinois against numerous domestic and foreign defendants alleging a global price-fixing conspiracy by suppliers of LCD Panels. On December 8, 2009, the case was transferred to this district by order of the Judicial Panel on Multidistrict Litigation and, pursuant to this Court’s July 3, 2007 Pretrial Order # 1, was deemed related to MDL No. 1827 (M 07-1827). Motorola filed an amended complaint on January 29, 2010.

On February 23, 2010, defendants filed a joint motion to dismiss the amended complaint under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Among other things, defendants argued that the Court lacked subject matter jurisdiction under the Foreign Trade Antitrust Improvements Act (“FTAIA”) to the extent that Motorola’s antitrust claims were based on injury suffered outside of the United States. On June 28, 2010, the Court granted defendants’ motion to dismiss under the FTAIA. June 28, 2010 Order at 10, 2010 WL 2610641.

On July 23, 2010, Motorola filed a second amended complaint (“SAC”), which included a number of new allegations. The SAC alleges that defendants and their co-conspirators “conspired with the purpose and effect of fixing, raising, stabilizing, and maintaining prices for LCD Panels.” Id. ¶ 2. Motorola alleges that senior executives of the defendants instructed subordinates in the United States to communicate with employees of their competitors to exchange pricing and other competitive information to be used in fixing prices for LCD Panels sold to U.S. companies. Id. Motorola alleges that “[a]t least seven LCD Panel manufacturers have admitted in criminal proceedings to participating in this conspiracy and conducting illegal price-fixing operations in the United States,” including defendants LG Display Co. Ltd., Sharp Corporation, Chunghwa Picture Tubes, Ltd., Epson Imaging Devices Corporation, Chi Mei Optoelectronics Corporation and HannStar Display Corporation. Id. ¶ 7. Motorola further alleges that defendants Sharp and Epson specifically identified Motorola as a customer which was overcharged for LCD Panels. Id. ¶ 8.

Motorola alleges that it was an intended victim of the price-fixing conspiracy and that the conspiracy was carried out, in part, in the United States. Motorola alleges that “[djefendants and their co-conspirators, using their U.S. affiliates, salespeople, and contacts entered into supply agreements with Motorola in Illinois to sell Motorola LCD Panels at unlawfully inflated prices.” Id. ¶ 4. “During and after the [Relevant Period], procurement teams at Motorola based in the U.S. negotiated the prices, conditions, and quantities that governed all Motorola purchases of LCD Panels around the world for inclusion in Motorola devices.” Id. ¶ 129. Motorola alleges that its U.S. procurement teams negotiated each LCD Panel purchase with defendants through a process that involved developing requests and preliminary specifications in collaboration with U.S. representatives for defendants and the final negotiation of the terms of purchase for LCD Panels. Id. ¶ 130. Motorola alleges that the prices set through this domestic negotiation process “directly and immediately impacted Motorola’s business plans, including its most basic business choices involving the production, pricing, and sales of its own products.” Id. ¶ 132. After the price for LCD Panels was set, Motorola’s supply chain organization (also based in Illinois) used an automatic scheduling process to determine the quantity requirements for it and its sub[839]*839sidiaries. Id. ¶ 133. This process was entirely directed by Motorola from the U.S., and “[t]he foreign affiliates issued purchase orders at the price and quantity determined by Motorola in the United States.” Id.

Motorola seeks treble damages and injunctive relief under Section 1 of the Sherman Act. Motorola also seeks relief under the antitrust laws of Illinois, the state in which it maintains its principal place of business. Finally, Motorola asserts individual claims for breach of contract and unjust enrichment against Sharp, Epson, Toshiba, Samsung and AU Optronics.

LEGAL STANDARDS

I. Federal Rule of Civil Procedure 12(b)(1)

Federal Rule of Civil Procedure 12(b)(1) allows a party to challenge a federal court’s jurisdiction over the subject matter of the complaint. As the party invoking the jurisdiction of the federal court, the plaintiff bears the burden of estabhshing that the court has the requisite subject matter jurisdiction to grant the relief requested. See Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). A complaint will be dismissed if, looking at the complaint as a whole, it appears to lack federal jurisdiction either “facially” or “factually.” Thornhill Publishing Co., Inc. v. General Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir.1979). In evaluating a facial attack to jurisdiction, the court must accept the factual allegations in plaintiffs complaint as true. See Miranda v. Reno, 238 F.3d 1156, 1157 n. 1 (9th Cir.2001). In evaluating a factual attack, the court may consider extrinsic evidence. See Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir.1987).

II. Federal Rule of Civil Procedure 12(b)(6)

Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544

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Related

In Re Tft-Lcd (Flat Panel) Antitrust Litigation
785 F. Supp. 2d 835 (N.D. California, 2011)

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Bluebook (online)
785 F. Supp. 2d 835, 2011 U.S. Dist. LEXIS 42692, Counsel Stack Legal Research, https://law.counselstack.com/opinion/motorola-inc-v-au-optronics-corp-cand-2011.