Best Buy Co. v. Hitachi Ltd. (In re Cathode Ray Tube (CRT) Antitrust Litig.)

• Decision Date: 13 March 2014
• Docket Number: Case No. C–07–5944–SC,MDL No. 1917
• Citation: 27 F.Supp.3d 1002
• Court: U.S. District Court — Northern District of California
• Parties: In re: Cathode Ray Tube (CRT) Antitrust Litigation. This Order Relates To: Best Buy Co., Inc. v. Hitachi Ltd., No. 11–cv–05513–SC; Costco v. Hitachi Ltd., No. 11–cv–06397–SC; Target Corp. v. Chunghwa, No. 11–cv–05514–SC; Tech Data v. Hitachi, Ltd., No. 13–cv–00157–SC.

27 F.Supp.3d 1002

In re: Cathode Ray Tube (CRT) Antitrust Litigation.

This Order Relates To:

Best Buy Co., Inc.

v.Hitachi Ltd., No. 11–cv–05513–SC;

Costco

v.Hitachi Ltd., No. 11–cv–06397–SC;

Target Corp.

v.Chunghwa, No. 11–cv–05514–SC;

Tech Data

v.Hitachi, Ltd., No. 13–cv–00157–SC.

MDL No. 1917

Case No. C–07–5944–SC

United States District Court, N.D. California.

Signed March 13, 2014

ORDER DENYING BEIJING–MATSUSHITA COLOR CRT CO.'S MOTION TO DISMISS

Samuel Conti, UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

Now before the Court is Defendant Beijing–Matsushita Color CRT Company's (“Defendant” or “BMCC”) motion to dismiss certain Direct Action Plaintiffs' (“Plaintiffs” or “DAPs”) complaints for lack of personal jurisdiction.¹ ECF No. 2118 (“MTD”). The motion is fully briefed. ECF Nos. 2239–4 (“Opp'n”) (filed under seal), 2363 (“Reply”).² Finding this matter suitable for disposition without oral argument, Civ. L.R. 7–1(b), the Court DENIES the motion.

II. BACKGROUND

Defendant is a Chinese company with its principal place of business in Beijing, China. See Target SAC ¶ 38; Best Buy FAC ¶ 44; Sears Compl. ¶ 40; Tech Data FAC ¶ 46. During the time relevant to the Complaints, Defendant was a joint venture, and its shareholders included MT Picture Display Co. Ltd. (“MTPD”), a subsidiary of Defendant Panasonic Corporation (“Panasonic”), which owned 50 percent of Defendant. Id. Three Chinese companies owned the remainder. See id. Plaintiffs allege that MTPD controlled Defendant, classified it as a business unit, monitored its activities, and assigned its directors responsibility over Defendant. ECF No. 2339–5 (“Loh Decl.”) Ex. D at 6, 11, 12, 17, 18, 27, 37, 38 (filed under seal). Originally, MTPD was formed as a joint venture between Defendants Panasonic and Toshiba, with Panasonic owning 64.5 of MTPD and Toshiba owning the remaining 35.5, but Panasonic purchased Toshiba's share on March 30, 2007, making MTPD Panasonic's wholly owned subsidiary. Best Buy FAC ¶ 43; Tech Data FAC ¶ 45; Target SAC ¶ 37. Panasonic personnel moved interchangeably through Defendant, MTPD, and related entities.

Plaintiffs allege that between at least 1998 and 2007, Defendant conspired to fix prices of CRTs ultimately sold in the United States. See Best Buy FAC ¶¶ 1, 4, 14, 44; Tech Data FAC ¶¶ 1, 4, 15, 46; Target SAC ¶¶ 1, 3, 14, 38. This included attending meetings with co-conspirators regarding the prices of CRTs sold to corporate affiliates, which manufactured finished CRT Products like televisions and computer monitors for sale in the United States. See Best Buy FAC ¶¶ 116–30, 146; Tech Data FAC ¶¶ 121–34, 142; Target SAC ¶¶ 109–24, 140. The co-conspirators allegedly ensured that all original equipment manufacturers (“OEMs”), including their affiliates, paid supracompetitive prices for CRTs around the world, including in the United States. See Best Buy FAC ¶ 127; Tech Data FAC ¶ 132; Target SAC ¶ 120.

Defendant allegedly participated in price-fixing meetings in China between 1998 and 2007. See, e.g., Loh Decl. Ex. E (“Samsung Interrogs.”) at 29–85 (summarizing Defendant Samsung SDI's price-fixing meetings with alleged co-conspirators, including Defendant); id. Ex. F (“Yang Depo.”) 402:3–22 (stating that Defendant and other alleged co-conspirators conducted meetings in China); id. Ex. G (“Lu Depo.”) 238:2–23 (same); id. Ex. O (meeting notes from a discussion among alleged co-conspirators, including Defendant, regarding CRT marketing information, including sales to United States customers like Wal–Mart, Circuit City, and Sears). The alleged co-conspirators coordinated pricing decisions in relation to United States market conditions, and discussed CRT prices in U.S. dollars. Id. Ex. H (“Mar. 9, 2001 Notes”) at CHU00029193E (noting that Defendant Orion, as well as other unnamed customers, would see an increase in orders as the United States market's high season drew closer), CHU00029194E (stating that though Defendant did not attend that meeting, another party was responsible for delivering price increase news to Defendant so that producers would not confuse customers by providing lower prices); id. Ex. I (“Aug. 23, 1999 Notes”) at CHU00029179.02E (confirming that Defendant had raised CRT prices from USD 29.50 to USD 30.50 following communications with another alleged co-conspirator).

Importantly for this particular case, Defendant asserts that it never sold any CRTs or CRT Products to United States customers—rather, it sold the majority of its CRTs to customers in China. ECF No. 2118–1 (“Kinoshita Decl.”) ¶¶ 21–23. It sold certain CRTs to Defendant Panasonic, which then sold them in the United States, but Defendant avers that it had no control over or responsibility for Panasonic's volume or pricing decisions. Id. Certain deposition testimony states, however, that Defendant sold CRTs to AKEI, which the witness states was a New Jersey-based Matsushita affiliate. Loh Decl. Ex. K (“Liu Depo.”) 423:17–424:11. Further, Panasonic and Defendant exchanged frequent emails regarding Chinese television makers' sales to the United States. See Loh Decl. Ex. L (“Jun. 13, 2002 Email”). Defendant supplied this information to Panasonic, which included certain Chinese manufacturers' sales to Best Buy and the American military, among others. Loh Decl. Ex. M (“Sept. 11, 2003 Email”). Other emails concern discussions among Defendant, Panasonic, and MTPD about price and volume increases to the United States. Loh Decl. Ex. N (“Sept. 11, 2006 Email”).

Plaintiffs sued Defendant under federal and state antitrust and competition laws, based on their allegations that Defendant fixed prices on CRTs that it or its affiliates sold in the United States. Defendant moves to dismiss, arguing that the Court lacks either general or specific jurisdiction over it, and that some Plaintiffs' service on Defendant was improper, owing to what Defendant claims is the Court's error in prior orders concerning methods of serving foreign defendants.

III. LEGAL STANDARD

A. Jurisdiction—Rule 12(b)(2)

Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, defendants may move to dismiss for lack of personal jurisdiction. The Court may consider evidence presented in affidavits and declarations determining personal jurisdiction. Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir.2001). Plaintiff bears the burden of showing that the Court has personal jurisdiction over Defendants. See Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th Cir.2006). “[T]his demonstration requires that the plaintiff make only a prima facie showing of jurisdictional facts to withstand the motion to dismiss.” Id. (quotations omitted). “[T]he court resolves all disputed facts in favor of the plaintiff....” Id. (quotations omitted). “The plaintiff cannot simply rest on the bare allegations of its complaint, but uncontroverted allegations in the complaint must be taken as true.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir.2011) (quotations and citations omitted). The Court may not assume the truth of allegations that are contradicted by affidavit. Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1284 (9th Cir.1977).

Courts may exercise personal jurisdiction over a defendant only if (1) a statute confers jurisdiction and (2) exercising jurisdiction would comport with constitutional due process. See Action Embroidery Corp. v. Atlantic Embroidery, Inc., 368 F.3d 1174, 1177 (9th Cir.2004). Since the federal Clayton Act, 15 U.S.C. § 22, fulfills the statutory requirement for jurisdiction in this case, the question on this motion is whether exercising jurisdiction would comport with due process. For a court to exercise personal jurisdiction over a non-resident defendant consistent with due process, the defendant must have “certain minimum contacts” with the relevant forum “such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940) ). If a defendant has sufficient minimum contacts, personal jurisdiction may be founded on either general jurisdiction or specific jurisdiction. Panavision Int'l, L.P. v. Toeppen, 141 F.3d 1316, 1320 (9th Cir.1998). The relevant forum for this case's minimum contacts analysis is the United States. Go–Video, Inc. v. Akai Elec. Co. Ltd., 885 F.2d 1406, 1415–16 (9th Cir.1989).

IV. DISCUSSION

A. Waiver

Plaintiffs first argue that Defendant waived its personal jurisdiction defense. As a general rule, if a party files a responsive pleading or makes a Rule 12 motion but does not raise personal jurisdiction as a defense, the party waives the right to raise personal jurisdiction later.See Fed. R. Civ. P. 12(h) ; Parker v. United States, 110 F.3d 678, 682 (9th Cir.1997). Plaintiffs cite to some of Defendant's earlier MDL filings, in other plaintiffs' cases, to support their contention that Defendant has waived its personal jurisdiction argument in this case by not raising it in other cases. See Opp'n at 11 (citing various filings). Plaintiffs argue that because their complaints are essentially the same as the other plaintiffs' were, and Defendant is represented by the same counsel, Defendant must have waived its personal jurisdiction defense in this case by not raising it in previous, separate cases. Id. at 11–12 (citing In re Polyester Staple Antitrust Litig., No. 3:03–CV–1516, 2008 WL 906331, at *16–18 (W.D.N.C. Apr. 1, 2008) ). Plaintiffs also contend that simply by being part of this litigation for over five years, Defendant has waived its personal jurisdiction defense by implication.

Plaintiffs are correct about the basic law of Rule 12 and waiver, but they are wrong about how it works in this particular instance. The Ninth Circuit has held that even if actions are closely related—as when different plaintiffs sue the same defendant in different cases but based on the...