Seagate Technology LLC v. NHK Spring Co., Ltd.

Summary

The Ninth Circuit vacated a district court order granting NHK Spring partial summary judgment in an antitrust action involving alleged price-fixing of hard disk drive suspension assemblies. The court held that the Foreign Trade Antitrust Improvements Act’s import-commerce exclusion did not apply because the suspension assemblies were not directly imported into the United States. However, Seagate adequately alleged that price-fixing conduct negotiated in the United States had domestic effects that directly caused foreign antitrust injury, leaving proximate cause for the district court to assess on remand.

Holdings

1. The import-commerce exclusion does not apply because the suspension assemblies were not directly imported into the United States; only finished hard-disk drives containing the assemblies were imported.
2. Seagate sufficiently established at the summary-judgment stage that NHK's price-fixing had a direct, substantial, and reasonably foreseeable effect on U.S. domestic commerce.
3. Seagate presented a viable theory that the domestic effect of NHK's price-fixing proximately caused the foreign entities' antitrust injuries because U.S.-negotiated prices allegedly controlled the foreign entities' purchases, although factual questions required remand.
4. Seagate Thailand was not merely a purchasing agent because it purchased the suspension assemblies for its own purposes rather than for Seagate Technology LLC.
5. The allegations that Seagate Technology LLC purchased suspension assemblies and that NHK sold assemblies for incorporation into products sold in the United States were sufficient to permit further consideration of an indirect-purchaser or pass-on theory; the district court must determine in the first instance whether the claim is viable under Illinois Brick.

Questions Presented

1. Whether the FTAIA's import-commerce exclusion applies when price-fixed component parts are purchased abroad, incorporated into finished products abroad, and only the finished products are imported into the United States.
2. Whether Seagate sufficiently alleged and supported the FTAIA's domestic-effects exception by showing that NHK's price-fixing directly, substantially, and foreseeably affected U.S. commerce and that the domestic effect proximately caused the foreign entities' antitrust injuries.
3. Whether Seagate Thailand acted merely as a purchasing agent for Seagate Technology LLC.
4. Whether Seagate Technology LLC adequately alleged a potentially viable indirect-purchaser or pass-on claim.
5. Whether the district court properly granted partial summary judgment on the foreign-commerce claims.

Disposition

vacated