Pfizer, Inc v. Government of India

• Decision Date: 11 January 1978
• Docket Number: No. 76-749,76-749
• Citation: 54 L.Ed.2d 563,434 U.S. 308,98 S.Ct. 584
• Parties: PFIZER, INC., et al., Petitioners, v. GOVERNMENT OF INDIA et al
• Court: U.S. Supreme Court

54 L.Ed.2d 563

98 S.Ct. 584

434 U.S. 308

PFIZER, INC., et al., Petitioners,

v GOVERNMENT OF INDIA et al.

No. 76-749.

Argued Nov. 1, 1977.

Decided Jan. 11, 1978.

Rehearing Denied Feb. 27, 1978.

See 435 U.S. 910, 98 S.Ct. 1462.

Syllabus by the Court

A foreign nation otherwise entitled to sue in the courts of this country held to be a "person" within the meaning of § 4 of the Clayton Act and thus to be entitled to sue for treble damages under the federal antitrust laws to the same extent as any other plaintiff. Pp. 311-320.

(a) Though no statutory provision or legislative history clearly covers the question whether a foreign nation is a "person" as the word is used in § 4 (which gives "any person" injured by antitrust violations the right to sue in district courts), Congress intended the word to have a broad and inclusive meaning, and in light of the antitrust laws' expansive remedial purpose, the Court has not narrowly construed the term. Pp. 311-313.

(b) Congress did not intend to make the treble-damages remedy available only to consumers in this country as is manifest from the inclusion of foreign corporations within the statutory definition of "person" and the fact that the antitrust laws extend to trade "with foreign countries." Pp. 313-314.

(c) To deny a foreign plaintiff injured by an antitrust violation the right to sue would defeat the two purposes of § 4: to deter violators and deprive them of the " 'fruits of their illegality,' " and "to compensate victims of antitrust violations for their injuries." Illinois Brick Co. v. Illinois, 431 U.S. 720, 746, 97 S.Ct. 2061, 2075, 52 L.Ed.2d 707. Pp. 314-315.

(d) When a foreign nation enters our commercial markets as a purchaser of goods or services, it can be victimized by anticompetitive practices just as surely as a private person or a domestic State, which in Georgia v. Evans, 316 U.S. 159, 62 S.Ct. 972, 86 L.Ed. 1346, was held to be a "person" within the meaning of the antitrust laws; and there is no reason why Congress would have wanted to deprive a foreign nation of the treble-damages remedy available to others who suffer through violations of the antitrust laws. Pp. 315-318.

(e) Foreign nations are generally entitled to prosecute civil claims in the courts of the United States upon the same basis as domestic corporations or individuals. To afford foreign nations the protection of the antitrust laws does not involve a judicial encroachment upon foreign policy, since only governments recognized by and at peace with the United States are entitled to access to this country's courts, and it is within the exclusive power of the Executive Branch to determine which nations are entitled to sue. Pp. 318-320.

550 F.2d 396, 8 Cir., affirmed.

Samuel W. Murphy, Jr., New York City, for petitioners.

Douglas V. Rigler, Washington, D. C., for respondents.

Mr. Justice STEWART delivered the opinion of the Court.

In this case we are asked to decide whether a foreign nation is entitled to sue in our courts for treble damages under the antitrust laws. The respondents are the Government of India, the Imperial Government of Iran, and the Republic of the Philippines. They brought separate actions in Federal District Courts against the petitioners, six pharmaceutical manufacturing companies. The actions were later consolidated for pretrial purposes in the United States District Court for the District of Minnesota.¹ The complaints alleged that the peti- tioners had conspired to restrain and monopolize interstate and foreign trade in the manufacture, distribution, and sale of broad spectrum antibiotics, in violation of §§ 1 and 2 of the Sherman Act, ch. 647, 26 Stat. 209, as amended, 15 U.S.C. §§ 1, 2. Among the practices the petitioners allegedly engaged in were price fixing, market division, and fraud upon the United States Patent Office.² India and Iran each alleged that it was a "sovereign foreign state with whom the United States of America maintains diplomatic relations"; the Philippines alleged that it was a "sovereign and independent government." Each respondent claimed that as a purchaser of antibiotics it had been damaged in its business or property by the alleged antitrust violations and sought treble damages under § 4 of the Clayton Act, 38 Stat. 731, 15 U.S.C. § 15, on its own behalf and on behalf of several classes of foreign purchasers of antibiotics.³ The petitioners asserted as an affirmative defense to the complaints that the respondents as foreign nations were not "persons" entitled to sue for treble damages under § 4. In response to pretrial motions ⁴ the District Court held that the respondents were "persons" and refused to dismiss the actions.⁵ The trial court certified the question for appeal pursuant to 28 U.S.C. § 1292(b).⁶ The Court of Appeals for the Eighth Circuit affirmed, 550 F.2d 396, and adhered to its decision upon rehearing en banc.⁷ Id., at 400. We granted certiorari to resolve an important and novel question in the administration of the antitrust laws. 430 U.S. 964, 97 S.Ct. 1643, 52 L.Ed.2d 355.

I

As the Court of Appeals observed, this case "turns on the interpretation of the statute." 550 F.2d, at 397. A treble-damages remedy for persons injured by antitrust violations was first provided in § 7 of the Sherman Act, and was re-enacted in 1914 without substantial change as § 4 of the Clayton Act.⁸ Section 4 provides:

"[A]ny person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee."

Thus, whether a foreign nation is entitled to sue for treble damages depends upon whether it is a "person" as that word is used in § 4. There is no § atutory provision or legislative history that provides a clear answer; it seems apparent that the question was never considered at the time the Sherman and Clayton Acts were enacted.⁹

The Court has previously noted the broad scope of the remedies provided by the antitrust laws. "The Act is comprehensive in its terms and coverage, protecting all who are made victims of the forbidden practices by whomever they may be perpetrated." Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236, 68 S.Ct. 996, 1006, 92 L.Ed. 1328; cf. Perma Life Mufflers, Inc. v. International Parts Corp., 392 U.S. 134, 138-139, 88 S.Ct. 1981, 1984, 20 L.Ed.2d 982. And the legislative history of the Sherman Act demonstrates that Congress used the phrase "any person" intending it to have its naturally broad and inclusive meaning. There was no mention in the floor debates of any more restrictive definition. Indeed, during the course of those debates the word "person" was used interchangeably with other terms even broader in connotation. For example, Senator Sherman said that the treble-damages remedy was being given to "any party," and Senator Edmunds, one of the principal draftsmen of the final bill,¹⁰ said that it established "the right of anybody to sue who chooses to sue." 21 Cong.Rec. 2569, 3148 (1890).

In light of the law's expansive remedial purpose, the Court has not taken a technical or semantic approach in determining who is a "person" entitled to sue for treble damages. Instead, it has said that "[t]he purpose, the subject matter, the context, the legislative history, and the executive interpretation of the statute are aids to construction which may indicate" the proper scope of the law. United States v. Cooper Corp., 312 U.S. 600, 605, 61 S.Ct. 742, 744, 85 L.Ed. 1071.

II

The respondents in this case possess two attributes that could arguably exclude them from the scope of the sweeping phrase "any person." They are foreign, and they are sovereign nations.

A.

As to the first of these attributes, the petitioners argue that, in light of statements made during the debates on the Sherman Act and the general protectionist and chauvinistic attitude evidenced by the same Congress in debating contemporaneous tariff bills, it should be inferred that the Act was intended to protect only American consumers. Yet it is clear that a foreign corporation is entitled to sue for treble damages, since the definition of "person" contained in the Sherman and Clayton Acts explicitly includes "corporations and associations existing under or authorized by . . . the laws of any foreign country." See n.9, supra. Moreover, the antitrust laws extend to trade "with foreign nations" as well as among the several States of the Union. 15 U.S.C. §§ 1, 2.¹¹ Clearly, therefore, Congress did not intend to make the treble-damages remedy available only to consumers in our own country.¹²

In addition, the petitioners' argument confuses the ultimate purposes of the antitrust laws with the question of who can invoke their remedies. The fact that Congress' foremost concern in passing the antitrust laws was the protection of Americans does not mean that it intended to deny foreigners a remedy when they are injured by antitrust violations. Treble-damages suits by foreigners who have been victimized by antitrust violations clearly may contribute to the protection of American consumers.

The Court has noted that § 4 has two purposes: to deter violators and deprive them of " 'the fruits of their illegality,' " and "to compensate victims of antitrust violations for their injuries." Illinois Brick Co. v. Illinois, 431 U.S. 720, 746, 97 S.Ct. 2061, 2075, 52 L.Ed.2d 707; Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 485-486, 97 S.Ct. 690, 695-96, 50 L.Ed.2d 701; Perma Life Mufflers, Inc. v. International Parts Corp., supra, 392 U.S., at 139, 88 S.Ct., at 1984. To deny a foreign plaintiff injured by an antitrust violation the right to sue would defeat these purposes. It would permit a...