State Of Washington v. Lg Electronics

Court of Appeals of Washington·Decided December 22, 2014·No. 70299-8·Published

Opinion

o il' i r; C " r 9 r, m in- I

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

STATE OF WASHINGTON, DIVISION ONE

Respondent,

No. 70299-8-1

(linked with No. 70298-0-1)

LG ELECTRONICS, INC.; LG PUBLISHED OPINION ELECTRONICS U.S.A. INC.; KONINKLIJKE PHILIPS ELECTRONICS N.V. a/k/a ROYAL PHILIPS ELECTRONICS N.V.; PHILIPS ELECTRONICS NORTH AMERICA CORPORATION; TOSHIBA CORPORATION; TOSHIBA AMERICA ELECTRONIC COMPONENTS, INC.; HITACHI, LTD.; HITACHI DISPLAYS, LTD.; HITACHI ELECTRONIC DEVICES (USA), INC.; and HITACHI ASIA, LTD.,

Petitioners,

PHILIPS ELECTRONICS INDUSTRIES (TAIWAN), LTD.; SAMSUNG SDI CO., LTD. f/k/a SAMSUNG DISPLAY DEVICE CO., LTD.; SAMSUNG SDI AMERICA, INC.; SAMSUNG SDI MEXICO S.A. DE C.V.; SAMSUNG SDI BRASIL LTDA.; SHENZHEN SAMSUNG SDI CO., LTD.; TIANJIN SAMSUNG SDI CO., LTD.; SAMSUNG SDI (MALAYSIA) SDN. BHD.; MT PICTURE DISPLAY CO., LTD.; PANASONIC CORPORATION f/k/a MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD.; PANASONIC

CORPORATION OF NORTH AMERICA; CHUNGHWA PICTURE TUBES LTD.; CPTF OPTRONICS CO., LTD.; and CHUNGHWA PICTURE TUBES (MALAYSIA) SDN. BHD.,

Defendants. FILED: December 22, 2014

Dwyer, J. — Resolution of this matter, which comes before us on discretionary review, requires us to ascertain the legislature's intent in enacting and amending certain provisions of the Washington Consumer Protection Act (CPA).1 Two questions have been certified for review. First, when, pursuant to the CPA, the Attorney General of Washington brings an action as parens patriae2 on behalf of Washington residents, is his action subject to the four-year limitation period contained within RCW 19.86.120? Second, is his action an "inherently sovereign" one that, by virtue of being brought for the "benefit of the state," is exempted from any other statutory limitation period by RCW 4.16.160?

We hold that when the legislature authorized the Attorney General to bring an action to enforce the CPA as parens patriae, it did not intend for such actions to be subject to the limitation period set forth in RCW 19.86.120. Further, we hold that it was the legislature's intent that such actions, the authority for which inheres in the notion of state sovereignty, be exempted from any otherwise applicable statutory limitation period. Given the manner in which we resolve these certified questions, we are satisfied that the trial court did not err in denying the Petitioners' motion to dismiss the Attorney General's complaint. Accordingly, we affirm.

1 Chapter 19.86 RCW.

2Literally, "parentof his or her country." Black's Law Dictionary 1287 (10th ed. 2014).

On May 1, 2012, the Attorney General,3 acting on behalf of the State and as parens patriae on behalf of persons residing in Washington, brought suit against more than 20 foreign corporate entities.4 While geographically diffuse, the defendants had a common characteristic—past participation in the global market for cathode ray tubes (CRTs).5 The Attorney General alleged that the defendants had, in violation of the CPA, participated in a worldwide conspiracy to raise prices and set production levels in the market for CRTs, which caused Washington State residents and State agencies to pay supracompetitive prices for CRT products.6 The Attorney General averred that the defendants had engaged in such anticompetitive conduct beginning, at the latest, on March 1, 1995, and ending, at the earliest, on November 25, 2007. By way of relief, the Attorney General requested, among other things, that the trial court (1) issue appropriate injunctions to prohibit illegal activity, (2) award any and all civil penalties permitted by law, and (3) award damages and restitution to the State on behalf of its agencies and residents.

Upon receiving service of process, 10 of the defendants (hereinafter

3 At the time that the complaint was filed, the Attorney General of Washington was Robert M. McKenna. The current Attorney General is Robert W. Ferguson.

4 These entities were scattered across four continents and ten different countries, including South Korea, Taiwan, China, Japan, Malaysia, Singapore, the United States of America, Mexico, Brazil, and the Netherlands.

5A cathode ray tube is a display technology used in televisions, computer monitors, and other specialized applications. According to the Attorney General, CRTs, until recently, represented the "dominant technology for manufacturing televisions and computer monitors."

6The Attorney General defined CRT products as "CRTs and products containing CRTs, such as televisions and computer monitors."

Petitioners7) jointly filed a motion to dismiss the complaint pursuant to CR 12(b)(6).8 Therein, the Petitioners contended that the Attorney General's claims were time-barred by operation of a four-year limitation period contained within the CPA. In order to avoid the preclusive effect of this limitation period, the Petitioners asserted, the complaint needed to be filed by November 25, 2011. As noted, the complaint was not filed until May 1, 2012.

The Attorney General opposed the Petitioners' motion to dismiss, arguing that the causes of action pleaded in his complaint were not time-barred by the limitation period in the CPA or by any otherwise applicable statutory limitation period.

On March 28, 2013, King County Superior Court Judge Richard Eadie denied the Petitioners' motion to dismiss.

Thereafter, pursuant to RAP 2.3(b)(4),9 the Petitioners sought and obtained from the trial court a certification for discretionary review of the order denying their dispositive motion. Finding that the criteria for certification pursuant to RAP 2.3(b)(4) had been satisfied, the trial court certified for immediate review

7Koninklijke Philips Electronics N.V., Philips Electronics North America Corporation, Toshiba Corporation, Toshiba America Electronic Components, Inc., LG Electronics, Inc., LG Electronics U.S.A., Inc., Hitachi, Ltd., Hitachi Displays, Ltd., Hitachi Electronic Devices (USA) Inc., and Hitachi Asia, Ltd.

8 (b) How Presented. Every defense, in law or fact, to a claim for relief in any pleading, whethera claim, counterclaim, cross claim, or third party claim, shall be asserted in the responsive pleading thereto if one is required, except that the following defenses may at the option of the pleader be made by motion: . . .

(6) failure to state a claim upon which reliefcan be granted ....

9 (b) Considerations Governing Acceptance of Review. Except as provided in section (d), discretionary review may be accepted only in the following circumstances:

(4) The superior court has certified, or all the parties to the litigation have stipulated, that the order involves a controlling question of law as to which there is substantial ground for a difference of opinion and that immediate review ofthe order may materially advance the ultimate termination of the litigation.

the following two questions:10

(1) Whether the four-year statute of limitations under RCW 19.86.120 applies to the Washington's Attorney General's Complaint brought pursuant to its parens patriae authority under RCW 19.86.080 that seeks actual damages!11' for violations of RCW 19.86.030?

(2) Whether RCW 4.16.160 should be applied to the Washington Attorney General's parens patriae antitrust lawsuit seeking actual damages[12] and restitution for citizens of Washington?

On August 2, 2013, finding that the "trial court's certification is well taken,"

a commissioner of this court granted discretionary review of the preceding questions. Neither the Petitioners nor the Attorney General moved to modify the commissioner's order granting discretionary review.

Separately, the Attorney General, in response to a trial court order dismissing his claims for lack of personal jurisdiction over certain defendants, filed a notice of appeal in this court.13 That appeal is to be resolved by separate opinion. The underlying litigation has been stayed.

10 These questions were identical to those that had been proposed by the Petitioners.

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State Of Washington v. Lg Electronics, (Wash. Ct. App. 2014).

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