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From Antitrust Law Daily, July 15, 2016

Washington's price fixing claims against CRT makers not time-barred

By Jeffrey May, J.D.

The State of Washington was not barred by the four-year statute of limitations in the state’s Consumer Protection Act (CPA) from suing foreign electronics manufacturers for conspiring to fix prices in the market for cathode ray tubes (CRTs) used in televisions and computer monitors, the Washington Supreme Court has ruled in a seven-to-two decision. Even though the state filed the parens patriae action more than four years after learning about the challenged conduct, decisions below rejecting dismissal on statute of limitations grounds were upheld, and the matter was remanded to the trial court for further proceedings. The case is of particular interest to antitrust enforcers in states, such as Washington, Connecticut, Oregon, and Virginia, where there are apparently no express time limits for parens patriae actions (State of Washington v. LG Electronics, Inc., July 14, 2016, González, S.).

The CPA's statute of limitations provision bars "claim[s] for damages under RCW 19.86.090" if not commenced within four years. The state brought its complaint pursuant to its parens patriae authority under RCW 19.86.080 that sought actual damages for violations of RCW 19.86.030. The court ruled that the statute of limitations of RCW 19.86.120 did not apply to RCW 19.86.080 actions. The statutory language and the legislative history supported this view, according to the court.

Defending manufacturers contended that a four-year limitations period applied because the CPA was to be construed in harmony with federal antitrust statutes, and under federal law, claims brought by state attorneys general were subject to a four-year limitations period. The Clayton Act's four-year statute of limitations applied to state attorney general suits for treble damages for persons injured in their business or property. Here, the state proceeded under RCW 19.86.080, which authorizes the state to recover money or property as restitution. A separate statutory provision, RCW 19.86.090, authorized treble damages claims by private persons for injuries to business and property and by the state for its direct and indirect injuries. RCW 19.86.120 expressly included .090 claims only, which were qualitatively different from .080 claims brought only by the attorney general, the court explained.

Nullum tempus doctrine. Under the nullum tempus doctrine, statutes of limitations do not run against the state unless the state expressly consents to the limitation on its sovereign powers. RCW 4.16.160 codified the common law nullum tempus doctrine. The court ruled that, under RCW 4.16.160, the attorney general's suit for injunctive relief and restitution pursuant to .080 was immune from limitations periods, in the absence of an express statute to the contrary.

RCW 4.16.160 provides that "... there shall be no limitation to actions brought in the name or for the benefit of the state." The court rejected the defending manufacturers argument that the nature and character of the state's .080 action was not for the purpose of protecting the public's interest and that the action, instead, was one enforcing a private or individual right because the state sought monetary restitution for consumers. Although consumers might benefit from restitution, the legislature clearly intended for the attorney general's enforcement under .080 to benefit the public generally, the court explained. Also rejected was the defending manufacturer's assertion that a 2007 amendment, providing that the attorney general may bring an action in the name of the state, "or as parens patriae on behalf of persons residing in the state," demonstrated legislative intent to distinguish a parens patriae claim from one brought in the name of the state for the purposes of excluding it from RCW 4.16.160.

Dissent. In an opinion concurring in part and dissenting in part, it was argued that the state should not be permitted to bring otherwise time-barred and unauthorized indirect claims through a parens patriae action under RCW 19.86.080. The two justices writing separately rejected the majority's conclusion that the legislature gave the attorney general the authority to circumvent all statutes of limitations by authorizing him or her to sue "as parens patriae on behalf of persons residing in the state." The state's parens patriae action did not constitute an action brought "in the name or for the benefit of the state." The majority's conclusion that RCW 19.86.120's time bar was inapplicable to RCW 19.86.080 claims was not questioned by the separate opinion.

The case is No. 91263-7.

Attorneys: David Michael Kerwin, Washington State Attorney General's Office, for the State of Washington. David C. Lundsgaard (Miller Nash Graham & Dunn LLP) and Robert Douglas Stewart (Kipling Law Group PLLC) for LG Electronics, Inc., LG Electronica U.S.A., Inc., and Koninklijke Philips Electronics N.V. a/k/a Royal Philips Electronics North America Corp.

Companies: LG Electronics, Inc.; LG Electronica U.S.A., Inc.; Koninklijke Philips Electronics N.V. a/k/a Royal Philips Electronics North America Corp.

MainStory: TopStory Antitrust WashingtonNews

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