Aguilar v. Atlantic Richfield Co.

• Decision Date: 14 June 2001
• Docket Number: No. S086738.,S086738.
• Court: California Supreme Court
• Parties: Theresa AGUILAR et al., Plaintiffs and Appellants, v. ATLANTIC RICHFIELD COMPANY et al., Defendants and Appellants.

107 Cal.Rptr.2d 841

25 Cal.4th 826

24 P.3d 493

Theresa AGUILAR et al., Plaintiffs and Appellants, v. ATLANTIC RICHFIELD COMPANY et al., Defendants and Appellants.

No. S086738.

Supreme Court of California.

June 14, 2001.

As Modified July 11, 2001.

Spiegel Liao & Kagay, Michael I. Spiegel, Charles M. Kagay, San Francisco; Cohelan & Khoury, Timothy D. Cohelan, Isam C. Khoury, Diana M. Khoury, Michael D. Singer, Margaret L. Coates, San Diego; The Mogin Law Firm, Daniel J. Mogin and Angela Milea Mogin, San Diego, for Plaintiffs and Appellants.

John J. Sansome, County Counsel (San Diego), Diane Bardlsey, Chief Deputy County Counsel, C. Ellen Pilsecker and Timothy M. Barry, Deputy County Counsel, for County of San Diego as Amicus Curiae, on behalf of Plaintiffs and Appellants.

Casey Gwinn, City Attorney (San Diego) and Leslie E. Devaney, Assistant City Attorney, for City of San Diego as Amicus Curiae, on behalf of Plaintiffs and Appellants.

McDougal, Love, Eckis & Grindle, McDougal, Love, Eckis, Smith & Boehmer, El Cajon, and Glenn P. Sabine, La Mesa, for City of La Mesa as Amicus Curiae, on behalf of Plaintiffs and Appellants.

Zelle, Hofmann, Voelbel & Gette and Craig C. Corbitt, San Francisco, for Utility Consumers' Action Network as Amicus Curiae on behalf of Plaintiffs and Appellants.

Law Offices of Francis O. Scarpulla, Francis O. Scarpulla, San Francisco; Law Offices of Ruel Walker and W. Ruel Walker, Oakland, for the California Trucking Association as Amicus Curiae, on behalf of Plaintiffs and Appellants.

Bill Lockyer, Attorney General, Richard M. Frank, Chief Assistant Attorney General, Thomas Greene, Assistant Attorney General, Peter Siggins, Kathleen E. Foote and John G. Donhoff, Jr., Deputy Attorneys General, as Amici Curiae, on behalf of Plaintiffs and Appellants.

Pillsbury, Madison & Sutro, Pillsbury Winthrop, Robert A. Mittelstaedt, Craig E. Stewart, Caroline N. Mitchell, San Francisco; and Paul R. Truebenbach, San Francisco, for Defendants and Appellants Chevron Corporation and Chevron U.S.A. Inc.

Munger, Tolles & Olson, Ronald L. Olson, Bradley S. Phillips, William D. Temko, Hojoon Hwang, Los Angeles; and Raymond V. McCord, Los Angeles, for Defendant and Appellant Shell Oil Company.

Richard C. Morse, John J. Kralik IV, Susan C. Wright, Los Angeles; Post, Kirby, Noonan & Sweat, David J. Noonan, Sandra L. Lackey, San Diego; Arnold & Porter and Ronald C. Redcay, Los Angeles, for Defendant and Appellant Atlantic Richfield Company.

William R. Hurt, Gregory T. Kenney, Houston, TX; Kelly H. Scoffield, Las Vegas, NV; Law Offices of Patrick J. Sullivan and Patrick J. Sullivan, Oceanside, for Defendant and Appellant Exxon Corporation.

Hogan & Hartson, Mary Carter Andrues, Kirsten S. Harbers, John Mark Potter, Andrew J. Kilcarr, Stephen G. Vaskov, Washington, DC; and Elizabeth J. Haegelin, for Defendant and Appellant Mobil Oil Corporation.

Howrey & Simon, Howrey Simon Arnold & White, Alan M. Grimaldi, Cheryl O'Connor Murphy, Mark I. Levy, Charles H. Samel, Dale J. Giali, Michael J. McGaughey, Los Angeles; Lawrence R. Jerz, White Plains, NY; Robert E. Fuller and Mark D. Litvak, for Defendant and Appellant Texaco Refining and Marketing, Inc.

Manatt, Phelps & Phillips, Craig J. de Recat, Kevin O'Connell, Dennis Franks, Shari Mulrooney Wollman, Edward M. Jordan and Sam Puathasnanon, Los Angeles; Blecher & Collins, Maxwell M. Blecher, Harold R. Collins, Jr., William C. Hsu, Los Angeles; Marilyn Jenkins Milner, Marina Del Rey, for Defendant and Appellant Ultramar Inc.

Latham & Watkins, James W. Baker, Peter H. Benzian, John J. Lyons, Gregory N. Pimstone, Julia E. Parry, J. Thomas Rosch and Kristine L. Wilkes, San Diego, for Defendant and Appellant Tosco Corporation.

Robins, Kaplan, Miller & Ciresi, Ernest I. Reveal III, Susan L. Dunbar, Elliot S. Kaplan, Minneapolis, MN; and Timothy R. Thomas, El Segundo, for Defendant and Appellant Union Oil Company of California.

Neilsen, Merksamer, Parrinello, Mueller & Naylor, John E. Mueller and Andrew M. Wolfe, Mill Valley, for California Chamber of Commerce and California Manufacturers and Technology Association as Amici Curiae on behalf of Defendants and Appellants.

Knox, Lemmon & Anapolsky, Thomas S. Knox, Sacramento; Jones, Day, Reavis & Pogue, Donald B. Ayer and Jeffrey A. LeVee, Los Angeles, for California Retailers Association as Amicus Curiae on behalf of Defendants and Appellants.

MOSK, J.

We granted review in this cause to clarify the law that courts must apply in ruling on motions for summary judgment, both in actions generally and specifically in antitrust actions for unlawful conspiracy.

I

This is an antitrust action arising from a complaint filed by Theresa Aguilar on behalf of herself and all of the other, by her estimate, 24 million retail consumers of California Air Resources Board, or CARB, gasoline—collectively, Aguilar—against Atlantic Richfield Company, Chevron Corporation, Exxon Corporation, Mobil Oil Corporation, Union Oil Company of California (later succeeded by 76 Products Company), Shell Oil Company, Texaco Refining and Marketing, Inc., Tosco Corporation, and Ultramar Inc.—collectively, the petroleum companies.¹

In conducting our review, we have scrutinized facts that are many and complex. The motions for summary judgment with which we are concerned produced a voluminous record, which fills more than 18,400 pages. They arose out of extensive discovery, which yielded, according to one tally, more than 100 depositions, 1,500 interrogatories, 135 requests for admissions, 900 requests for the production of documents, and 500,000 pages of documents in response to such requests.

But because our review focuses on the law that courts must apply in ruling on motions for summary judgment in all actions including the present, and not on the application of such law in this particular one, we need not state the facts in detail and at length. For our purposes, the following synopsis will suffice.

The Legislature has found and declared that the "petroleum industry is an essential element of the California economy and is therefore of vital importance to the health and welfare of all Californians." (Pub. Resources Code, § 25350, subd. (a).) In 1991, the California Air Resources Board adopted regulations requiring the sale in this state of a new, cleaner burning, but more expensive formulation of gasoline— CARB gasoline—beginning in 1996. In 1991, the state's market for gasoline was oligopolistic, that is, it was served by a few large firms, including as major participants the petroleum companies that figure here. Although the gasoline used in the state was not unique, the state itself was relatively isolated. Each of the petroleum companies faced decisions of substantial magnitude and difficulty with respect to CARB gasoline capacity, production, and pricing. In arriving at its own decisions and then following through, each had to make great capital expenditures, from a low of about $100 million to a high of more than $1 billion. In 1996, the state's market for gasoline was even more oligopolistic, being served by even fewer large firms, including as dominant participants the petroleum companies that figure here. The state itself remained relatively isolated. But, now, the gasoline used in the state was unique. The price of CARB gasoline, once introduced, moved generally upward across all of the petroleum companies more or less together, rising quickly and falling slowly. Subsequent state and federal investigations expressly or impliedly attributed the generally upward price movement of CARB gasoline to various market forces, including the higher cost of its production, the higher cost of crude oil from which it was produced, higher demand, lower inventories, unplanned production outages, and higher taxes.

II

On June 7,1996, on behalf of herself and all other retail consumers of CARB gasoline, Aguilar filed an unverified complaint, with a demand for trial by jury, against the petroleum companies in the Superior Court of San Diego County. In the complaint, as subsequently amended into its operative form, she alleged facts for a primary cause of action for violation of section 1 of the Cartwright Act (Stats. 1907, ch. 530, § 1, pp. 984-985, as amended, Bus. & Prof.Code, § 16720 et seq.), which is analogous to section 1 of the Sherman Act (Act of July 2, 1890, ch. 647, § 1, 26 Stat. 209, as amended, 15 U.S.C. § 1), asserting in substance that the petroleum companies had entered into an unlawful conspiracy to restrict the output of CARB gasoline and to raise its price— specifically, a conspiracy among competitors that is unlawful per se without regard to any of its effects. She also alleged facts for a derivative cause of action for violation of the unfair competition law (Bus. & Prof. Code, § 17200 et seq.), asserting in substance that the conspiracy in question, even if not unlawful under the Cartwright Act, was unlawful at least under the unfair competition law itself.

The petroleum companies each answered, denying all of the allegations referred to above.

Later, the petroleum companies each moved the superior court for summary judgment. In support, they each presented evidence including declarations by officers or managers or similar employees with responsibility in the premises, generally stating on personal knowledge how the company made its capacity, production, and pricing decisions about CARB gasoline, asserting that it did so independently, and denying that it did so collusively with any of the others. Aguilar opposed the motions. In support, she presented evidence including the companies' gathering and dissemination of capacity, production, and pricing information, through the independently owned and operated Oil Price Information Service, or OPIS, and otherwise; their use of common consultants; and, perhaps most prominently, their execution of exchange agreements—under which, for example, two companies may trade, with or...