T-Mobile U.S.A., Inc. v AU Optronics Corporation, et al

Filing 35

Joint MOTION to Dismiss and Notice of Motion to Dismiss filed by AU Optronics Corporation, AU Optronics Corporation America Inc, CHIMEI INNOLUX CORPORATION, CMO Japan Co Ltd, Chi Mei Corporation, Chi Mei Optoelectronics USA Inc, Chunghwa Picture Tubes Ltd, Epson Electronics America Inc, Epson Imaging Devices Corporation, Hannstar Display Corporation, Hitachi Displays Ltd, Hitachi Electronic Displays USA Inc, Hitachi LTD, LG Display America Inc, LG Display Co Ltd, Nexgen Mediatech Inc, Nexgen Mediatech USA Inc, Samsung Electronics America Inc, Samsung Electronics Co Ltd, Samsung SDI America Inc, Samsung SDI Co Ltd, Samsung Semiconductor Inc, Sanyo Consumer Electronics Ltd, Seiko Epson Corporation, Sharp Corporation, Sharp Electronics Corporation, Tatung Company, Tatung Company of America Inc, Toshiba America Electronics Components Inc, Toshiba America Information Systems Inc, Toshiba Corporation, Toshiba Mobile Display Technology Co Ltd. Motion Hearing set for 10/28/2011 09:00 AM in Courtroom 10, 19th Floor, San Francisco before Hon. Susan Illston. Responses due by 9/29/2011. Replies due by 10/6/2011. (Nedeau, Christopher) (Filed on 9/15/2011)

1
2
3
4
5
6
7
8

CHRISTOPHER A. NEDEAU (CA SBN 81297)
CARL L. BLUMENSTEIN (CA SBN 124158)
PATRICK J. RICHARD (CA SBN 131046)
SALEZKA L. AGUIRRE (CA SBN 260956)
NOSSAMAN LLP
50 California Street, 34th Floor
San Francisco, CA 94111
Telephone: [phone]
Facsimile: 415.398.2438
[e-mail]
[e-mail]
[e-mail]
[e-mail]

10

Attorneys for Defendants
AU OPTRONICS CORPORATION and
AU OPTRONICS CORPORATION AMERICA

11

[additional defendants on signature page]

9

12

UNITED STATES DISTRICT COURT

13

NORTHERN DISTRICT OF CALIFORNIA – SAN FRANCISCO DIVISION

14
15
16

THIS DOCUMENT RELATES TO:

Case No. 3:11-cv-02591 SI

3:11-CV-02591 SI

MDL NO. 3:07-MD-1827 SI

T-MOBILE U.S.A., INC.,

DEFENDANTS’ JOINT NOTICE OF
MOTION AND MOTION TO DISMISS
COMPLAINT

17
18
19
20
21

Plaintiff,
vs.
AU OPTRONICS CORPORATION, et al.,

22

Defendants.

Date:
October 28, 2011
Time:
9:00 A.M.
Location: Courtroom 10, 19th Floor
450 Golden Gate Avenue
San Francisco, CA 94102

23
24
25
26
27
28
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

TABLE OF CONTENTS

1
2

PAGE

3
4

I.

STATEMENT OF THE ISSUES...............................................................................................1

5

II.

INTRODUCTION .....................................................................................................................2

6

III.

FACTUAL BACKGROUND....................................................................................................3

7

A.

T-Mobile’s Allegations Regarding Its Purchases of LCD Products....................................4

8

B.

Allegations that Defendants’ Conspiracy Included STN-LCD Panels ................................5

9

C.

Allegations that Defendants’ Conspiracy Included Small-Size LCD Panels ......................5

10

D.

T-Mobile’s Allegations as to the Involvement of Defendants and Their Entire
Corporate Families...............................................................................................................5

11
12

IV.

LEGAL STANDARD................................................................................................................6

V.

ARGUMENT.............................................................................................................................7

13

A.

Because T-Mobile Filed Its Complaint More Than Four Years After the
Investigation into the Alleged Conspiracy was Publicly Disclosed, the Statutes of
Limitations Bar this Action..................................................................................................7

B.

T-Mobile’s Complaint Fails to Allege that T-Mobile Purchased the Products at
Issue in California and New York. ......................................................................................7

C.

T-Mobile Lacks Standing to Assert Sherman Act and Clayton Act Claims for
Damages Based on Indirect Purchases from OEMs. ...........................................................9

D.

T-Mobile Cannot Maintain Donnelly Act Claims for Indirect Purchases Made
Prior to December 23, 1998. ..............................................................................................10

E.

The Complaint Fails to Allege Sufficient Facts to Support a Conspiracy as to
STN-LCD Panels. ..............................................................................................................11

F.

T-Mobile Fails to Allege Sufficient Facts to Support Its Claim of a Conspiracy to
Fix Prices of Small-size LCD Panels.................................................................................12

G.

The Complaint Does Not Allege Sufficient Facts Particular to Each Defendant. .............14

14
15
16
17
18
19
20
21
22
23
24

VI.

CONCLUSION........................................................................................................................17

25
26
27
28
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
i
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

TABLE OF AUTHORITIES

1
2

PAGE(S)

3

CASES

4

Allstate Ins. Co. v. Hague
449 U.S. 302 (1981)................................................................................................................................ 7

5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27

Ashcroft v. Iqbal
129 S. Ct. 1937 (2009)................................................................................................................... passim
Bell Atl. Corp. v. Twombly
550 U.S. 544 (2007)....................................................................................................................... passim
Blewett v. Abbott Labs., Inc.
86 Wash. App. 782 (1997)...................................................................................................................... 8
Hutson v. Am. Home Mortg. Servicing, Inc.
No. C 09-1951, 2009 WL 3353312 (N.D. Cal. Oct. 16, 2009)............................................................... 6
Ice Cream Distribs., LLC v. Dreyer's Grand Ice
No. 09-5815, 2010 WL 2198200 (N.D. Cal. May 28,2010)................................................................... 7
Illinois Brick Co. v. Illinois
431 U.S. 720 (1977)....................................................................................................................... passim
In re ATM Fee Antitrust Litig.
768 F. Supp. 2d 984 (N.D. Cal. 2009) .................................................................................................... 7
In re Elevator Antitrust Litig.
502 F.3d 47 (2d Cir. 2007).................................................................................................................... 16
In re Gilead Scis. Sec. Litig.
536 F.3d 1049 (9th Cir. 2008) ................................................................................................................ 6
In re Graphics Processing Units Antitrust Litig.
527 F. Supp. 2d 1011 (N.D. Cal. 2007) .................................................................................................. 8
In re Refrigerant Compressors Antritrust Litig.
No. 2:09-md-02042, 2011 U.S. Dist. LEXIS 63297 (E.D. Mich. June 13, 2011)................................ 10
In re Sagent Tech., Inc., Deriv. Litig.
278 F. Supp. 2d 1079 (N.D. Cal. 2003) ................................................................................................ 16
In re TFT-LCD (Flat Panel) Antitrust Litig. (AT&T Mobility)
No. M 07-1827 SI, 2010 WL 2609434 at (N.D. Cal. June 28, 2010)................................................. 2, 6
In re TFT-LCD (Flat Panel) Antitrust Litig. (Motorola)
No. M 07-1827 SI, 2010 WL 2610641 (N.D. Cal. June 28, 2010)................................................... 8, 11

28
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
ii
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27

In re TFT-LCD (Flat Panel) Antitrust Litig. (Nokia)
No. M 07-1827 SI, 2010 WL 2629728 (N.D. Cal. June 29, 2010)................................................ passim
In re TFT-LCD (Flat Panel) Antitrust Litig. (State of Fl.)
No. M 07–1827 SI, 2011 WL 1100133 (N.D. Cal. Mar. 24, 2011)........................................................ 8
In re TFT-LCD (Flat Panel) Antitrust Litig. (Target)
No. M 07-1827 SI, ECF No. 3362 (N.D. Cal. Aug. 24, 2011) ......................................................... 3, 10
Jung v. Ass’n of Am. Med. Colls.
300 F. Supp. 2d 119 (D.D.C. 2004) ...................................................................................................... 14
Kendall v. Visa U.S.A. Inc.
518 F.3d 1042 (9th Cir. 2008) ....................................................................................................... passim
Lennon v. Philip Morris Cos.
734 N.Y.S.2d 374 (Sup. Ct. 2001)........................................................................................................ 11
McHenry v. Renne
84 F.3d 1172 (9th Cir. 1996) ................................................................................................................ 12
Nicholson v. Kovach
No. C 04-01789, 2005 U.S. Dist. LEXIS 7181 (N.D. Cal. Apr. 18, 2005) .......................................... 12
Nordberg v. Trilegiant Corp.
445 F. Supp. 2d 1082 (N.D. Cal. 2006) ................................................................................................ 15
Odom v. Microsoft Corp.
486 F.3d 541 (9th Cir. 2007) ................................................................................................................ 15
Phillips Petroleum Co. v. Shutts
472 U.S. 797 (1985)................................................................................................................................ 7
Precision Assocs. v. Panalpina World Transp. (Holding) Ltd.
No. 08-CV-42, 2011 U.S. Dist. LEXIS 51330 (E.D.N.Y. Jan. 4, 2011) .............................................. 15
Russo & Dubin v. Allied Maint. Corp.
407 N.Y.S.2d 617 (Sup. Ct. 1978)........................................................................................................ 10
Thome v. Alexander & Louisa Calder Found.
70 A.D. 3d 88 (N.Y. App. Div. 2009) .................................................................................................... 7
Total Benefits Planning Agency, Inc. v. Anthem Blue Cross & Blue Shield
552 F.3d 430 (6th Cir. 2008) ................................................................................................................ 16
United States v. Bestfoods
524 U.S. 51 (1998)................................................................................................................................ 16
Vitamins Antitrust Litig.
No. 99-197 (TFH), 2000 U.S. Dist. LEXIS 15109 (D.D.C. Oct. 6, 2000) ........................................... 11

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
iii
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

STATUTES

2

15 U.S.C. § 15(b) ....................................................................................................................................... 7

3

Cal. Bus. & Prof. Code

4

§167501........................................................................................................................................... 7

5

§17208............................................................................................................................................. 7

6
7
8
9
10
11

N.Y. Gen. Bus. Law
§§340-347 ..................................................................................................................................... 10
§340(1).......................................................................................................................................... 10
§340(5)............................................................................................................................................ 7
§340(6).......................................................................................................................................... 10

12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
iv
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

NOTICE OF MOTION AND MOTION TO DISMISS

1
2

TO ALL PARTIES AND THEIR COUNSEL OF RECORD:

3

PLEASE TAKE NOTICE that on October 28, 2011 at 9:00 a.m., or as soon thereafter as the

4

matter may be heard, in Courtroom 10, 19th Floor, 450 Golden Gate Avenue, San Francisco, California,

5

before the Honorable Susan Illston, the defendants listed in the signature blocks below (“Defendants”)

6

will and hereby do move the Court, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure,

7

for an Order dismissing the Complaint for Damages and Injunctive Relief (“Complaint”) filed by

8

Plaintiff T-Mobile U.S.A., Inc. (“T-Mobile”).

9
10

This motion is based upon this Notice of Motion, the following Memorandum of Points and
Authorities, argument of counsel, and such other matters as the Court may consider.
MEMORANDUM OF POINTS AND AUTHORITIES

11
12
13
14
15

I.

STATEMENT OF THE ISSUES
1.

Whether T-Mobile’s claims are time-barred because they are brought more than four

years after T-Mobile alleges it discovered the alleged TFT-LCD panel price-fixing conspiracy.
2.

Whether T-Mobile’s claims brought under the laws of California and New York should

16

be dismissed because T-Mobile does not allege facts sufficient to establish those States’ interests in this

17

action consistent with the Due Process Clause of the U.S. Constitution.

18

3.

Whether T-Mobile’s Sherman Act claims based upon indirect purchases of LCD Products

19

should be dismissed for lack of standing under the Supreme Court’s decision in Illinois Brick Co. v.

20

Illinois, 431 U.S. 720 (1977).

21
22
23

4.

Whether T-Mobile’s Donnelly Act claims for indirect purchases made prior to December

23, 1998, should be dismissed for lack of standing.
5.

Whether T-Mobile’s claims for purchases of LCD Products other than TFT-LCD

24

Products should be dismissed for failure to allege sufficient facts to support any alleged conspiracy as to

25

those non-TFT LCD Products.

26
27
28
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
1
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

6.

Whether T-Mobile’s claims for purchases of mobile LCD Products should be dismissed

2

for failure to allege sufficient facts supporting a conspiracy to fix the prices of LCD panels used in

3

mobile handsets.

4

7.

Whether all claims asserted by T-Mobile should be dismissed because T-Mobile fails to

5

allege sufficient facts regarding the involvement of each defendant in the alleged price-fixing

6

conspiracy.

7

II.

8
9
10
11

INTRODUCTION
T-Mobile’s Complaint lacks critical allegations to support its scattershot claims and is rife with

flaws and deficiencies that warrant dismissal of T-Mobile’s claims under Federal Rule of Civil
Procedure 12(b)(6).
First, T-Mobile brings its claims after the expiration of the statutes of limitations applicable to its

12

federal and state-law claims, respectively. T-Mobile fails to allege in its Complaint that any tolling is

13

applicable to its claims. Therefore, all of its claims are time-barred and should be dismissed.

14

Second, T-Mobile’s claims under the laws of California and New York should be dismissed on

15

Due Process grounds. To satisfy Due Process, T-Mobile must plead the location of its purchases. In

16

fact, this Court has repeatedly held that “in order to invoke the various state laws at issue, plaintiffs must

17

be able to allege that ‘the occurrence or transaction giving rise to the litigation’ – plaintiffs’ purchases of

18

allegedly price-fixed goods – occurred in the various states.” In re TFT-LCD (Flat Panel) Antitrust

19

Litig. (AT&T Mobility), No. M 07-1827 SI, 2010 WL 2609434, at *2-3 (N.D. Cal. June 28, 2010). T-

20

Mobile’s Complaint, however, is conspicuously vague as to where T-Mobile made the purchases that

21

give rise to its claims.

22

Third, at least some of T-Mobile’s claims are impermissibly based upon indirect purchases of

23

LCD Products, rather than any direct dealings with Defendants. Under Illinois Brick Co. v. Illinois, 431

24

U.S. 720 (1977), T-Mobile does not have standing to sue for damages arising from indirect purchases of

25

LCD Products, such as those it made from original equipment manufacturers (“OEMs”), even if the

26

LCD Products it purchased contained LCD panels manufactured by Defendants and sold to the OEMs.

27

Accordingly, any Sherman Act and Clayton Act claims for damages based on such indirect purchases

28

should be dismissed for lack of standing under Illinois Brick.

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
2
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

Fourth, as this Court recently recognized, New York’s Donnelly Act does not authorize recovery

2

for claims based on indirect purchases made before December 23, 1998. As a result, T-Mobile’s

3

Donnelly Act claims based on indirect purchases made before that date should be dismissed for lack of

4

standing. In re TFT-LCD (Flat Panel) Antitrust Litig. (Target), No. M 07-1827 SI, ECF No. 3362, at 5

5

(N.D. Cal. Aug. 24, 2011).

6

Fifth and sixth, T-Mobile’s attempt to expand its claims beyond an alleged conspiracy to price-

7

fix particular TFT-LCD panels should not be allowed. T-Mobile summarily concludes that any

8

collusion with respect to certain large-sized TFT-LCD panels also encompassed the market for STN-

9

LCD panels and small-size LCD panels used in mobile handsets. Such bootstrap allegations, however,

10

do not constitute “evidentiary facts which if true, will prove” a conspiracy to fix the prices of STN-LCD

11

panels or small-size LCD panels. Kendall v. Visa U.S.A. Inc., 518 F.3d 1042, 1047 (9th Cir. 2008).

12

Further, to the extent T-Mobile seeks to allege the existence of separate conspiracies as to these panels,

13

it has not done so: T-Mobile’s Complaint fails to answer the “basic questions: who, did what, to whom

14

(or with whom), where, and when,” required in pleading a claim for an antitrust violation. Id.

15

Finally, the Complaint fails to sufficiently allege each defendant’s involvement in the alleged

16

price-fixing conspiracy. The Complaint groups corporate family members together as single entities and

17

fails to differentiate among the members. Instead of alleging specific conduct as to each defendant, as

18

required under Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009), and Bell Atl. Corp. v. Twombly, 550 U.S. 544

19

(2007), T-Mobile impermissibly relies on group pleading to generically allege the conduct of thirty-three

20

separate entities. But mere conclusory allegations of agency between and among corporate family

21

members are insufficient to state a claim against individual entities. Therefore, T-Mobile’s state and

22

federal claims as to all Defendants should be dismissed.

23

III.

FACTUAL BACKGROUND

24

T-Mobile alleges a price-fixing conspiracy among suppliers of “LCD Products,” a term it defines

25

to include both LCD panels and finished products containing LCD panels as components. See Compl. ¶

26

19. The price-fixing conspiracy among manufacturers of “LCD Products” allegedly lasted from January

27

1, 1996 through December 11, 2006. Id. ¶ 21. The Complaint alleges that Defendants concealed their

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
3
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

conspiracy and that T-Mobile did not discover the existence of the alleged conspiracy until December

2

2006, when the Department of Justice’s investigation became public. Id. ¶¶ 175, 184.

3

T-Mobile brings federal antitrust claims under the Sherman Act and state-law claims under

4

California’s Cartwright Act, California’s Unfair Competition Law, and New York’s Donnelly Act for its

5

direct and indirect purchases of mobile wireless handsets, desktop monitors, and notebooks during the

6

alleged conspiracy period. Id. ¶¶ 10-11, 169.

7

A.

T-Mobile’s Allegations Regarding Its Purchases of LCD Products

8

T-Mobile alleges that it made direct purchases of LCD Products from “certain defendants” and

9

that it “purchased mobile wireless handsets containing LCD Panels from other handset OEMs, which in

10

turn purchased LCD Panels from defendants and their co-conspirators.” Id. ¶¶ 10, 169, 172. T-Mobile

11

further alleges that it purchased desktop computer monitors and laptops containing LCD Panels, which

12

were manufactured by OEMs and then sold to T-Mobile for its own use. Id. ¶ 174.

13

T-Mobile fails to allege where any of these purchases occurred. T-Mobile generally alleges that

14

it “maintained, in each of the states where it operated company-owned retail stores and sold to

15

authorized sales agents, inventories of mobile wireless handsets that it purchased and received from the

16

handset vendors at its distribution centers.” Id. ¶ 25. T-Mobile also alleges that “all of T-Mobile’s

17

negotiations for the purchase of mobile wireless handsets and other LCD Products took place in the

18

United States and were controlled by procurement organizations based in the United States” and that “all

19

T-Mobile purchase orders for mobile wireless handsets and other LCD Products were issued from the

20

United States and all invoices were sent to T-Mobile in the United States.” Id. ¶ 28. Notably, nowhere

21

does T-Mobile allege where in the United States these transactions took place. To the extent it says

22

anything, the Complaint only vaguely suggests that its purchases may have occurred in Washington,

23

where T-Mobile’s headquarters are located. See id. ¶¶ 13, 22 (“Defendants and their co-conspirators

24

knew that price-fixed LCD Panels and Products containing price-fixed LCD Panels would be sold and

25

shipped into [the Western District of Washington].”). More importantly, T-Mobile nowhere alleges that

26

it purchased LCD Products in California and New York – the states under whose laws it now seeks to

27

make claims.

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
4
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

B.

Allegations that Defendants’ Conspiracy Included STN-LCD Panels

2

T-Mobile also glides over distinctions among products and the companies that manufacture

3

them. At the beginning of the Complaint, T-Mobile defines “LCD Panels” to include panels which it

4

acknowledges use distinct types of technology: TFT-LCD panels, CSTN-LCD panels, and MSTN-LCD

5

panels.1 Id. ¶¶ 3, 18. According to T-Mobile, while only certain Defendants “manufactured both TFT-

6

LCD Panels and STN-LCD Panels,” id. ¶ 156, all Defendants collectively entered a single conspiracy

7

involving “both TFT-LCD and STN-LCD Panels,” id. ¶ 3. The Complaint also alleges in wholly

8

conclusory fashion that the same individuals who attended Crystal Meetings and bilateral meetings

9

about TFT-LCD panels “also had pricing responsibilities for STN-LCD Panels.” Id. ¶ 156. According

10

to T-Mobile, certain Defendants engaged in bilateral discussions during which they shared pricing

11

information, which unspecified individuals or corporations then took into account in determining the

12

price of STN-LCD panels. Id. ¶ 158. Thus, T-Mobile argues, Defendants’ alleged price-fixing may be

13

presumed to have “inflated” prices for STN-LCD panels, as well as TFT-LCD panels. Id. ¶ 159.

14

C.

Allegations that Defendants’ Conspiracy Included Small-Size LCD Panels

15

T-Mobile speculates that all Defendants “conspired” to fix the prices for small-size LCD panels

16

used in mobile wireless handsets. Id. ¶ 121. The Complaint does not define either “large” or “small”

17

size LCD panels. In support of its speculation, T-Mobile asserts that Defendants entered into bilateral

18

agreements and that Sharp and Epson have pleaded guilty to fixing the price of small-size LCD panels

19

sold to Motorola. Id. ¶¶ 94, 121-22, 134, 136. The Complaint, however, does not contain any factual

20

allegations beyond the plea agreements of two Defendants with respect to one particular customer. T-

21

Mobile does not allege more than ultimate facts and conclusions, or attempt to allege how Defendants

22

participated in a conspiracy to fix the prices of small-size LCD panels. As set forth below, T-Mobile’s

23

broad brush-strokes fall far short of the applicable pleading standards.
D.

24
25
26
27
28

T-Mobile’s Allegations as to the Involvement of Defendants and Their Entire
Corporate Families

The Complaint names thirty-three distinct corporate entities in eleven corporate families as
“Defendants.” Id. ¶¶ 29-72. The Complaint groups these entities into corporate families and refers to

1

The Complaint refers to LCD panels that use CSTN and MSTN technologies together as STN-LCD
panels. Id.

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
5
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

these defined groups collectively. Rather than allege facts and conduct specific to each named

2

Defendant, the Complaint summarily presumes that each Defendant is responsible its affiliates’ conduct

3

and concludes that “all entities within the corporate families were active, knowing participants in the

4

alleged conspiracy.” Id. ¶ 139. The boilerplate language further concludes that each entity participated

5

in all conspiratorial contacts so long as a corporate affiliate participated. Id. Moreover, each Defendant

6

is alleged to be the agent or joint venturer of every other Defendant, even if no corporate affiliation

7

exists. Id. ¶ 74, 77.

8

IV.

9

LEGAL STANDARD
A complaint must “contain sufficient factual matter, accepted as true, to ‘state a claim to relief

10

that is plausible on its face.’” Iqbal, 129 S. Ct. at 1949 (quoting Twombly, 550 U.S. at 570); see also In

11

re TFT-LCD (Flat Panel) Antitrust Litig., 599 F. Supp. 2d 1179, 1184 (N.D. Cal. 2009) (a plaintiff’s

12

complaint must “contain sufficient factual allegations ‘to raise a right to relief above the speculative

13

level.’”). A plaintiff must “provide the ‘grounds’ of his ‘entitlement to relief’ [which] requires more

14

than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.”

15

Hutson v. Am. Home Mortg. Servicing, Inc., No. C 09-1951, 2009 WL 3353312, at *7 (N.D. Cal. Oct.

16

16, 2009) (citing Twombly, 550 U.S. at 555). Specifically, with respect to claims under Section 1 of the

17

Sherman Act “claimants must plead not just ultimate facts (such as a conspiracy), but evidentiary facts

18

which if true, will prove” a conspiracy. Kendall, 518 F.3d at 1047.

19

When faced with a motion to dismiss, a court “can choose to begin by identifying pleadings that,

20

because they are no more than conclusions, are not entitled to the assumption of truth. While legal

21

conclusions can provide the framework of a complaint, they must be supported by factual allegations.”

22

Iqbal, 129 S. Ct. at 1950. Only “when there are well-pleaded factual allegations, a court should assume

23

their veracity.” Id. Even then, the court must “determine whether [the factual allegations] plausibly

24

give rise to an entitlement to relief.” Id. “[T]he court is not required to accept as true ‘allegations that

25

are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.’” In re TFT-LCD

26

(Flat Panel) Antitrust Litig. (Nokia), No. M 07-1827 SI, 2010 WL 2629728, at *2 (N.D. Cal. June 29,

27

2010) (quoting In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008)).

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
6
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1
2

V.

ARGUMENT
A.

3
4

Because T-Mobile Filed Its Complaint More Than Four Years After the
Investigation into the Alleged Conspiracy was Publicly Disclosed, the Statutes of
Limitations Bar this Action.

The laws under which T-Mobile brings its claims each carry a four-year statute of limitations.

5

See 15 U.S.C. § 15(b) (Sherman Act claims); Cal. Bus. & Prof. Code §§ 16750.1, 17208 (California

6

claims); N.Y. Gen. Bus. Law § 340(5) (New York claims). In its Complaint, T-Mobile alleges that “the

7

conspiracy” began at least as early as January 1, 1996, and that it ended by December 2006. Compl. ¶

8

21. T-Mobile admits that the investigation of LG Display by foreign antitrust authorities, as well as the

9

U.S. Department of Justice, was publicly disclosed on December 11, 2006. Id. ¶ 123. T-Mobile further

10

admits that on December 12, 2006, “news reports indicated that in addition to LG Display, defendants

11

Samsung, Sharp, and AU Optronics were also under investigation.” Id. ¶ 124. Indeed, T-Mobile

12

acknowledges that any alleged fraudulent concealment on the part of Defendants had ended at the time

13

of these announcements. Id. ¶ 184. Yet T-Mobile waited until April 18, 2011 to file its Complaint,

14

more than four years after the date that the investigations became public. T-Mobile does not allege any

15

grounds for tolling the statutes of limitations after December 2006. Thus, T-Mobile has filed its

16

Complaint after the expiration of the statutes of limitations of both its federal and state law claims, and

17

its Complaint should be dismissed in its entirety. See Ice Cream Distribs., LLC v. Dreyer's Grand Ice,

18

No. 09-5815, 2010 WL 2198200, at *9-10 (N.D. Cal. May 28,2010) (dismissing part of plaintiff’s

19

Unfair Competition claims because they were barred by the statute of limitations); In re ATM Fee

20

Antitrust Litig., 768 F. Supp. 2d 984, 1000-02 (N.D. Cal. 2009) (dismissing Sherman Act claims that

21

were brought after the statute of limitations had elapsed); Thome v. Alexander & Louisa Calder Found.,

22

70 A.D. 3d 88, 112 (N.Y. App. Div. 2009) (affirming dismissal of plaintiff’s Donnelly Act claim

23

because claim was untimely).

24
25
26
27
28

B.

T-Mobile’s Complaint Fails to Allege that T-Mobile Purchased the Products at Issue
in California and New York.

In order to bring a state-law claim consistent with the Due Process Clause of the United States
Constitution, a plaintiff must allege that the State has significant contacts with both the parties and the
transactions at issue. Allstate Ins. Co. v. Hague, 449 U.S. 302, 310-11 (1981); Phillips Petroleum Co. v.
Shutts, 472 U.S. 797, 821-22 (1985). Indeed, this Court has repeatedly held in related cases that “Due
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
7
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

Process requires a plaintiff seeking to bring claims under a state’s antitrust law to demonstrate that the

2

purchases giving rise to those claims occurred within that state.” In re TFT-LCD (Flat Panel) Antitrust

3

Litig. (State of Fl.), No. M 07–1827 SI, 2011 WL 1100133, at *5 (N.D. Cal. Mar. 24, 2011); see also In

4

re TFT-LCD (Flat Panel) Antitrust Litig. (Costco), No. M 07-1827 SI, ECF No. 45, at 3-5 (N.D. Cal.

5

Aug. 29, 2011) (dismissing plaintiff’s state law claims because it did not allege that it purchased the

6

allegedly price-fixed products in those states); AT&T Mobility, 2010 WL 2609434, at *2-3 (holding that

7

“in order to invoke the various state laws at issue, plaintiffs must be able to allege that ‘the occurrence or

8

transaction giving rise to the litigation’ – plaintiffs’ purchases of allegedly price-fixed goods – occurred

9

in the various states”); Nokia, 2010 WL 2629728, at *3-4 (same); In re TFT-LCD (Flat Panel) Antitrust

10

Litig. (Motorola), No. M 07-1827 SI, 2010 WL 2610641, at *8-9 (N.D. Cal. June 28, 2010) (same);

11

Pecover v. Elecs. Arts. Inc., 633 F. Supp. 2d 976, 984 (N.D. Cal. 2009); In re Graphics Processing Units

12

Antitrust Litig., 527 F. Supp. 2d 1011, 1028 (N.D. Cal. 2007).

13

Here, T-Mobile brings state-law claims under the laws of California and New York but fails to

14

allege any facts that would provide a sufficient basis upon which to apply the laws of those states. For

15

instance, there are no factual allegations in the Complaint that T-Mobile purchased allegedly price-fixed

16

products in California and New York. Indeed, T-Mobile’s Complaint is drafted evasively, avoiding any

17

explicit reference to the particular location where its purchases were made.2

18

Additionally, although T-Mobile alleges a presence in a variety of states – including California

19

and New York – it does not link its presence in those states to any of its claims. For instance, T-Mobile

20

alleges that it “conducted a substantial volume of business in both California and New York,” that it

21

“provided wireless services and sold mobile wireless handsets containing LCD panels to customers in

22

California and New York through its corporate-owned retail stores,” and that it “maintained in both

23

California and New York inventories of mobile wireless handsets containing LCD Panels manufactured

24

and sold by defendants[.]” Compl. ¶¶ 26, 195, 205. But nowhere does T-Mobile allege that its claims

25
26
27
28

2

T-Mobile’s headquarters are located in Washington. Compl. ¶ 22. Therefore, it is probable that TMobile’s purchases also occurred in that State. See id. ¶ 13 (“Defendants and their co-conspirators
knew that price-fixed LCD Panels and Products containing price-fixed LCD Panels would be sold
and shipped into [the Western District of Washington].” ). If true, T-Mobile’s claims are a naked
attempt to shoehorn its way into state laws that allow indirect purchaser claims so as to avoid the
application of Washington law. See Blewett v. Abbott Labs., Inc., 86 Wash. App. 782, 783-84
(1997) (holding that indirect purchasers lack standing to sue under Washington’s antitrust statute).

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
8
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

arose from those sales. As this Court has cautioned, “presence in the various states does not establish a

2

link between plaintiffs’ antitrust claims and the States.” AT&T Mobility, 2010 WL 2609434, at *3

3

(emphasis added).

4

T-Mobile also alleges that certain Defendants admitted in plea agreements that they sold relevant

5

products to customers in California “in furtherance” of the alleged conspiracy. Compl. ¶ 197. “[T]he

6

fact that some defendants have admitted to selling price-fixed goods to customers in this District does

7

not [, however,] establish the requisite connection with California because those plea agreements do not

8

state, nor have plaintiffs alleged, that any defendants sold products to [T-Mobile] in California.” AT&T

9

Mobility, 2010 WL 2609434, at *3. In short, T-Mobile’s state-law claims offend Due Process and

10

should be dismissed.
C.

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

T-Mobile Lacks Standing to Assert Sherman Act and Clayton Act Claims for
Damages Based on Indirect Purchases from OEMs.

T-Mobile seemingly seeks to recover damages under federal antitrust laws for all of its purchases
of “LCD Products,” including purchases made from OEMs who are not alleged participants in the
alleged conspiracy. In Illinois Brick, however, the Supreme Court held that indirect purchasers lack
standing to sue for civil damages for alleged violations of the Sherman Act. In doing so, the Court
recognized the “evidentiary complexities and uncertainties” that are involved in the use of a pass-on
theory “by a plaintiff several steps removed from the defendant in the chain of distribution” and
“elevat[ed] direct purchasers to a preferred position[,] . . . den[ying] recovery to those indirect
purchasers who may have been actually injured by antitrust violations.” Illinois Brick, 431 U.S. at 732,
746.
T-Mobile’s Complaint alleges that T-Mobile purchased LCD Products, containing LCD panels
manufactured by Defendants, both directly from some, but not all, Defendants and from Original
Equipment Manufacturers (“OEMs”). Compl. ¶¶ 169, 172, 174. As to the latter instances, the OEMs
(not T-Mobile) are the direct purchasers of LCD panels with standing to assert a damages claim under
Section 4 of the Clayton Act, and T-Mobile, as their customer, is merely an indirect purchaser barred
from recovery.
Even though T-Mobile acknowledges that not all of its purchases of LCD Products were made
directly from Defendants, its Sherman Act Section 1 claim does not differentiate between purchases
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
9
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

allegedly made directly from Defendants or co-conspirators and purchases allegedly made from OEMs

2

not named as defendants or conspirators. Compl. ¶¶ 186-192. Rather, its claim for relief under the

3

Sherman Act seeks damages for T-Mobile’s “purchases of LCD Products containing LCD Panels sold

4

by defendants, their coconspirators, and others.” Id. ¶ 191 (emphasis added). T-Mobile’s Complaint

5

tries to circumvent Illinois Brick by seeking damages for all of T-Mobile’s purchases of LCD Products,

6

regardless of whether such LCD Products were purchased directly from one of the Defendants, one of

7

the alleged co-conspirators, or, in fact, from an OEM. To the extent that T-Mobile’s federal antitrust

8

damages claims are based upon purchases of finished products that were neither made from named

9

Defendants nor alleged co-conspirators (such as OEMs), this Court should dismiss those claims and only

10

allow T-Mobile to bring claims under the federal antitrust laws for those LCD Products T-Mobile

11

purchased directly from Defendants. See In re Refrigerant Compressors Antritrust Litig., No. 2:09-md-

12

02042, 2011 U.S. Dist. LEXIS 63297, at *42-43 (E.D. Mich. June 13, 2011) (dismissing federal claims

13

based on purchases of “refrigerant compressor products” as distinct from purchases of price-fixed

14

compressor themselves).

15
16
17

D.

T-Mobile Cannot Maintain Donnelly Act Claims for Indirect Purchases Made Prior
to December 23, 1998.

T-Mobile claims damages from an alleged conspiracy between January 1, 1996 and December

18

11, 2006. Compl. ¶ 21. T-Mobile invokes New York’s Donnelly Act, N.Y. Gen. Bus. Law §§ 340-347,

19

to seek damages based on purchases made during this period. The Donnelly Act provides a cause of

20

action against conspiracies that “unlawfully interfer[e] with the free exercise of any activity in the

21

conduct of any business, trade or commerce.” Id. § 340(1). On December 23, 1998, an amendment to

22

the Donnelly Act became effective that stated that the fact that a plaintiff “has not dealt directly with the

23

defendant shall not bar or otherwise limit recovery.” Id. § 340(6). Prior to this, New York courts

24

construed the Donnelly Act in accordance with Illinois Brick, barring recovery of damages for indirect

25

purchases. Russo & Dubin v. Allied Maint. Corp., 407 N.Y.S.2d 617, 621 (Sup. Ct. 1978).

26

As this Court recently recognized, both federal and New York state courts have held that the

27

1998 amendment to the Donnelly Act does not apply retroactively to indirect purchases made before the

28

enactment of the amendment. Target, ECF No. 3362, at 5 (“Courts have held that the amendment was

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
10
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

not retroactive[.]”); see also In re Vitamins Antitrust Litig., No. 99-197, 2000 U.S. Dist. LEXIS 15109,

2

at *36 (D.D.C. Oct. 6, 2000); Lennon v. Philip Morris Cos., 734 N.Y.S.2d 374, 382 (Sup. Ct. 2001)

3

(“[C]ourts interpreting provisions of the General Business Law have rejected retroactive application of

4

amendments creating new private rights of action. . . . Without allegations of events that postdate the

5

1998 amendment, the plaintiffs’ complaint fails to sufficiently state a claim.”). Accordingly, T-Mobile’s

6

claims under New York law for purchases made before December 23, 1998, should be dismissed.

7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

E.

The Complaint Fails to Allege Sufficient Facts to Support a Conspiracy as to STNLCD Panels.

T-Mobile’s claims of a conspiracy involving STN-LCD panels cannot survive a motion to
dismiss. Throughout the course of the LCD price-fixing litigation, this Court has time and again
dismissed speculative allegations about a conspiracy regarding STN-LCD panels. Nokia, 2010 WL
2629728, at *5-6 (“[T]he Court cannot infer the existence of such an expanded conspiracy based solely
on allegations of price-fixing in the TFT-LCD market[.]”); AT&T Mobility, 2010 WL 2609434, at *4-5
(same); Motorola, 2010 WL 2610641, at *9-10 (same).
As in those cases, the Complaint here does not allege sufficient facts to show Defendants’
involvement in the alleged price-fixing of STN-LCD panels. Just as in the complaints this Court has
rejected, T-Mobile broadly defines the term “LCD Panels” in the Complaint to include both TFT-LCD
panels and STN-LCD panels. Compare Compl. ¶ 18, with AT&T Mobility, 2010 WL 2609434, at *1
n.2. Through this pleading tactic, T-Mobile, in effect, alleges that the same price-fixing conspiracy
encompassed both TFT-LCD and STN-LCD panels. See, e.g., Compl. ¶ 97 (“The purpose and effect of
these [Crystal] meetings was to stabilize or raise prices.”).
Furthermore, the Complaint alleges that the government investigations resulted in guilty pleas
for fixing the prices of “LCD Panels,” see id. ¶¶ 123-39, which T-Mobile defines to include STN-LCD
panels, even though none of the pleas involved STN-LCD panels and the government’s investigation
addressed only TFT-LCD panels. Nokia, 2010 WL 2629728, at *5-6. Allegations regarding
government investigations and certain Defendants’ guilty pleas involving TFT-LCD panels do not
constitute “evidentiary facts which if true, will prove” a conspiracy regarding STN-LCD panels.
Kendall, 518 F.3d at 1047; see also Nokia, 2010 WL 2629728, at *6 (“‘To state a claim under Section 1
of the Sherman Act, . . . claimants must plead not just ultimate facts (such as a conspiracy), but
261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
11
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

evidentiary facts which if true, will prove’ a conspiracy. Here, the amended complaint does not contain

2

any specific factual allegations that defendants conspired to fix prices of STN-LCD panels, and the

3

Court cannot infer the existence of such an expanded conspiracy based solely on allegations of price-

4

fixing in the TFT-LCD market, or any other non-STN market.” (quoting Kendall, 518 F.3d at 1047)).

5

To the extent that T-Mobile attempts to allege a smaller or different price fixing conspiracy

6

involving only bilateral discussions, those claims also fall short, because the Complaint fails to identify

7

which of the thirty-three Defendants manufactured STN-LCD panels, which of the thirty-three

8

Defendants engaged in bilateral discussions and with whom, and where such discussions supposedly

9

took place. See Nicholson v. Kovach, No. C 04-01789, 2005 U.S. Dist. LEXIS 7181, at *5 (N.D. Cal.

10

Apr. 18, 2005) (“[A] complaint that is replete with detail but that fails to concisely and clearly identify

11

‘whom plaintiffs are suing for what wrongs, fails to perform the essential functions of a complaint.’”

12

(quoting McHenry v. Renne, 84 F.3d 1172, 1179-80 (9th Cir. 1996))). Thus, with respect to any alleged

13

conspiracy to fix the prices of STN-LCD panels, the Complaint once again fails to answer the “basic

14

questions: who, did what, to whom (or with whom), where, and when?” Kendall, 518 F.3d at 1048.

15

Having alleged “the conspiracy,” T-Mobile cannot escape the consequences of its generic, over-

16

inclusive allegations – and the holdings of Nokia and Kendall – by offering speculation as to other

17

implied or presumed “conspiracies.”

18
19
20

F.

T-Mobile Fails to Allege Sufficient Facts to Support Its Claim of a Conspiracy to Fix
Prices of Small-size LCD Panels.

Similarly, T-Mobile fails to allege facts sufficient to support its sweeping allegations regarding

21

the type of panels involved in the alleged conspiracy. The Complaint alleges that Defendants conspired

22

to fix the prices of LCD panels, including “LCD panels included in mobile wireless handsets,” Compl. ¶

23

2, and then attempts to connect all Defendants to this purported conspiracy with a hodgepodge of

24

allegations concerning (1) bilateral communications between some, but not all, of the Defendants; and

25

(2) two distinct plea agreements relating to a single customer. Id. ¶¶ 94, 121-122, 134, 136. But these

26

allegations are “no more than conclusions . . . not entitled to the assumption of truth.” Iqbal, 129 S. Ct.

27

at 1950.

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
12
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

As the Ninth Circuit has cautioned, antitrust plaintiffs must “allege facts such as a ‘specific time,

2

place or person involved in the alleged conspiracies’ to give a defendant seeking to respond to

3

allegations of a conspiracy an idea of where to begin.” Kendall, 518 F.3d at 1047. T-Mobile cannot

4

simply rely on conclusory statements that Defendants conspired to fix the price of small-size LCD

5

panels. Instead, it “must allege that each individual defendant joined the conspiracy and played some

6

role in it because at the heart of an antitrust conspiracy is an agreement and a conscious decision by each

7

defendant to join it.” Nokia, 2010 WL 2629728, at *7 (emphasis added). T-Mobile’s failure to make

8

allegations regarding each Defendant’s participation in the alleged conduct or conspiracy related to

9

small LCD panels requires dismissal of its claims.

10

Allegations Regarding Bilateral Communications. T-Mobile has, at best, made only limited

11

allegations regarding isolated bilateral discussions by only some of the Defendants related to the price-

12

fixing of small panels. See Compl. ¶¶ 94, 121-122. T-Mobile asserts that Sharp and Epson settled

13

criminal proceedings related to allegations of fixing the “price of LCD Panels sold to Motorola

14

(including panels to be incorporated in Motorola’s Razr handsets),” id. ¶¶ 134, 136, but alleges no facts

15

to support its assertion that each of the remaining Defendants entered into any agreement related to these

16

small panels. See Kendall, 518 F.3d at 1047. Instead, in an attempt to bridge the gap between bilateral

17

communications regarding small LCD panels and the Crystal Meeting conspiracy alleged in the rest of

18

the Complaint, T-Mobile simply states that all Defendants conspired to fix the prices of LCD panels,

19

including LCD panels used in mobile handsets. Compl. ¶ 2. That assertion is nothing more than a legal

20

conclusion. T-Mobile “must plead not just ultimate facts (such as a conspiracy), but evidentiary facts

21

which, if true, will prove” a conspiracy to fix the prices of LCD panels used in mobile handsets.

22

Kendall, 518 F.3d at 1047; see also Twombly, 550 U.S. at 555.

23

Allegations Regarding Plea Agreements. The existence of an alleged decade-long conspiracy

24

involving thirty-three Defendants to fix the prices of small-size LCD panels also cannot be inferred from

25

allegations that two Defendants have settled charges alleging bilateral agreements for a specific

26

customer during a span of less than one year. See Compl. ¶¶ 134, 136 (acknowledging that Sharp and

27

Epson’s guilty pleas were limited to TFT-LCD panels sold to Motorola during the fall of 2005 to the

28

middle of 2006). Further, these Defendants’ guilty pleas included only TFT-LCD panels, not all “LCD

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
13
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

Panels” as defined by T-Mobile. If anything, the Complaint’s reliance on the plea agreements

2

compounds the confusion and lack of specificity, because Sharp and Epson – the two Defendants whose

3

pleas are alleged to have covered bilateral agreements involving small LCD panels, id. – are not alleged

4

to have pleaded guilty to participating in the multilateral “Crystal Meeting” conspiracy. Likewise, no

5

allegation is made regarding the alleged Crystal Meeting conspirators and any bilateral small panel

6

guilty pleas.3

7

Accordingly, T-Mobile fails to plead “specific factual allegations” to support any plausible claim

8

that each of the Defendants conspired to fix the prices of small-size LCD panels used in mobile

9

handsets, and its claims should therefore be dismissed. See Twombly, 550 U.S. at 556 n.3 (“Without

10

some factual allegation in the complaint, it is hard to see how a claimant could satisfy the requirement of

11

providing not only ‘fair notice’ of the nature of the claim, but also ‘grounds’ on which the claim rests.”).

12

G.

The Complaint Does Not Allege Sufficient Facts Particular to Each Defendant.

13

As this Court has explained, an antitrust plaintiff “must allege that each individual defendant

14

joined the conspiracy and played some role in it because at the heart of an antitrust conspiracy is an

15

agreement and a conscious decision by each defendant to join it.” Nokia, 2010 WL 2629728, at *7

16

(dismissing claims where the complaint failed to allege “how [the subsidiary] participated in the

17

conspiracy”) (internal quotations omitted). A plaintiff cannot merely “alleg[e] that each defendant

18

participated in or agreed to join the conspiracy by using the term ‘defendants’ to apply to numerous

19

parties without any specific allegations.” Jung v. Ass’n of Am. Med. Colls., 300 F. Supp. 2d 119, 163

20

(D.D.C. 2004).

21

T-Mobile has ignored these notice pleading requirements and, instead, lumps together over two

22

dozen corporate parents, subsidiaries, and affiliates, using the label “defendants” to refer to all of them

23

as an undifferentiated mass. T-Mobile alleges that “defendants and others shipped during the

24

Conspiracy Period more than 400 million LCD Panels, including those incorporated into LCD Products,

25

into the United States . . . .” Compl. ¶ 161. T-Mobile also alleges that “defendants conduct business

26
27
28

3

Given the utter lack of allegations in any way linking the limited plea agreements to the broader
allegations, the Court need not address at this juncture whether the plea agreements even constitute
the type of “evidentiary facts” required by the Ninth Circuit under Kendall. Settlement agreements
involving other parties, other products, and different allegations, however, are plainly inadmissible
and therefore not “evidentiary facts.”

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
14
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

throughout the United States” and that “defendants’ activities have had a direct, substantial and

2

foreseeable effect on [interstate] commerce.” Id. ¶ 13. Nowhere, however, does T-Mobile allege which

3

particular Defendant sold LCD Panels in what locations, or how any particular Defendant’s “activities”

4

substantially affected interstate commerce, much less how these unspecified “activities” caused any

5

antitrust injury.

6

Moreover, the Complaint makes conclusory allegations regarding entire corporate families

7

without specifying the acts or involvement of any particular entity. Id. ¶ 139 (“all entities within the

8

corporate families were active, knowing participants in the alleged conspiracy”). In its remaining

9

allegations, T-Mobile does not even attempt to specifically tie affiliates or subsidiaries to a single factual

10

allegation in the Complaint. After first introducing each Defendant in the “Parties” section of the

11

Complaint, T-Mobile ceases any individualized allegations against Defendants. Its remaining

12

allegations against Defendants use one label to sweep in members of each corporate family. For

13

example, the Complaint alleges that “[i]n the early years of the conspiracy, beginning in at least 1996,

14

representatives of the Japanese-based conspirators, such as Sharp and Toshiba, met and agreed to fix the

15

prices for LCD Panels generally[.]” Id. ¶ 92. It is impossible to tell from the face of the Complaint

16

which Toshiba entity this allegation references.

17

The law does not allow these vague and conclusory shortcuts. Under Twombly and Iqbal, T-

18

Mobile cannot bring an entire corporate family into the case as one amalgamated defendant.4 See

19

Nordberg v. Trilegiant Corp., 445 F. Supp. 2d 1082, 1103 (N.D. Cal. 2006) (holding that mere

20

conclusory allegations of agency between corporate family members are insufficient to state a claim

21

against individual entities), abrogated on other grounds by Odom v. Microsoft Corp., 486 F.3d 541 (9th

22

Cir. 2007); Precision Assocs. v. Panalpina World Transp. (Holding) Ltd., No. 08-CV-42, 2011 U.S.

23

Dist. LEXIS 51330, at *54 (E.D.N.Y. Jan. 4, 2011) (“The argument that the grouped defendants joined

24
25
26
27
28

4

Defendants acknowledge that this Court has recently analyzed group pleading allegations and that its
reasoning in these cases may apply here, either to the Complaint or potentially more specific
allegations in an amended complaint. In re TFT-LCD (Flat Panel) Antitrust Litig. (Kodak), No. M
07-1827 SI, ECF No. 3346, at 3-4; In re TFT-LCD (Flat Panel) Antitrust Litig. (Target), No. M 071827 SI, ECF No. 3362, at 3-4; In re TFT-LCD (Flat Panel) Antitrust Litig. (Best Buy), No. M 071827 SI, ECF No. 3359, at 7-8. In any event, Defendants wish to preserve the group pleading
argument for appeal, as Defendants believe that this Complaint’s failure to state how each defendant
joined and participated in the putative conspiracy is insufficient to withstand a motion to dismiss
under Twombly and Kendall.

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
15
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

the alleged conspiracies through their corporate affiliation is precisely the sort of ‘legal conclusion

2

couched as a factual allegation’ that Twombly and Iqbal deemed insufficient to state a claim.”); In re

3

ATM Fee Antitrust Litig., No. C 04-02676 CRB, 2009 U.S. Dist. LEXIS 83199, at *55-56 (N.D. Cal.

4

Sept. 4, 2009) (dismissing complaint where plaintiffs “merely lump[ed] together allegations against [a]

5

holding company and its subsidiary”); In re Sagent Tech., Inc., Deriv. Litig., 278 F. Supp. 2d 1079,

6

1094-95 (N.D. Cal. 2003) (complaint insufficient where it “lumps together” 13 separate defendants).

7

Indeed, under well-established law, distinct corporate family members are presumed to act separately

8

and independently. United States v. Bestfoods, 524 U.S. 51, 61 (1998).

9

T-Mobile’s generic allegations of agency and joint-venturing are similarly unavailing. See

10

Compl. ¶¶ 74, 77 (“Each defendant acted as the agent or joint venturer of or for the other defendants

11

with respect to the acts, violations and common course of conduct alleged herein.”). The Complaint

12

contains no evidentiary facts to support T-Mobile’s conclusion that each of the thirty-three Defendants

13

was an agent or joint-venturer for or of other Defendants, or that each of the subsidiaries and other non-

14

parent-company corporate family members was an agent for its respective parent company. In addition,

15

T-Mobile cannot plausibly allege that unrelated Defendants are agents of each other for purposes of a

16

conspiracy merely because some of them participated in joint-ventures. If this were so, every legitimate

17

joint-venture partner would be subject to an antitrust complaint. See Twombly, 555 U.S. at 556-57

18

(finding allegation of parallel conduct plus allegation of conspiracy insufficient). Further, courts have

19

held that bare allegations of agency or joint-venturing between corporate family members, such as these,

20

are insufficient to survive a motion to dismiss. Nordberg, 445 F. Supp. 2d at 1103.

21

In short, T-Mobile’s Complaint should be dismissed because it fails to allege the requisite facts

22

about each Defendant’s supposed participation in the alleged conspiracy. See Kendall, 518 F.3d at 1048

23

(antitrust plaintiffs must allege the “basic questions: who, did what, to whom (or with whom), where,

24

and when”); Total Benefits Planning Agency, Inc. v. Anthem Blue Cross & Blue Shield, 552 F.3d 430,

25

436 (6th Cir. 2008) (“[G]eneric pleading, alleging misconduct against defendants without specifics as to

26

the role each played in the alleged conspiracy, was specifically rejected by Twombly[.]” (emphasis

27

added)); In re Elevator Antitrust Litig., 502 F.3d 47, 50-51 (2d Cir. 2007) (conclusory allegations of

28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
16
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

conspiracy are inadequate where complaint alleges conspiratorial activity “without any specification of

2

any particular activities by any particular defendant”).

3
4
5
6

VI.

CONCLUSION
For the foregoing reasons, Defendants respectfully request that the Court grant this motion in its

entirety and dismiss T-Mobile’s Complaint.
Respectfully submitted,

7
8
9

DATED: September 15, 2011

10
11
12

BY:

/s/ Christopher A. Nedeau
Christopher A. Nedeau
Attorneys for Defendants
AU OPTRONICS CORPORATION and
AU OPTRONICS CORPORATION AMERICA
HILLIS CLARK MARTIN & PETERSON P.S.

13
14

By: /s/ Michael R. Scott
Michael R. Scott

15
16

Michael R. Scott (admitted pro hac vice)
Michael J. Ewart (admitted pro hac vice)
Hillis Clark Martin & Peterson P.S.
1221 Second Avenue, Suite 500
Seattle WA 98101-2925
Tel: [phone]
Fax: [phone]

17
18
19
20

Attorneys for Defendants
CHIMEI INNOLUX CORPORATION F/K/A CHI
MEI OPTOELECTRONICS CORPORATION, CHI
MEI OPTOELECTRONICS USA, INC., CMO
JAPAN CO LTD., NEXGEN MEDIATECH INC.
AND NEXGEN MEDIATECH USA INC.

21
22
23
24
25
26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
17
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

BAKER & MCKENZIE LLP

2
3

By: /s/ Patrick J. Ahern
Patrick J. Ahern

4
5

Patrick J. Ahern (admitted pro hac vice)
One Prudential Plaza
130 E. Randolph Drive
Chicago, IL 60601
Tel: [phone]
Fax: [phone]

6
7
8

Attorneys for Defendants
CHUNGHWA PICTURE TUBES, LTD., TATUNG
COMPANY, and TATUNG COMPANY OF
AMERICA, INC.

9
10
11

MORRISON & FOERSTER LLP

12
13

By: /s/ Stephen P. Freccero
Stephen P. Freccero

14

Melvin R. Goldman (Bar No. 34097))
Stephen P. Freccero (Bar No. 131093)
Derek F. Foran (Bar No. 224569)
425 Market Street
San Francisco, CA 94105-2482
Tel: [phone]
Fax: [phone]

15
16
17
18

Attorneys for Defendants
EPSON IMAGING DEVICES CORPORATION,
EPSON ELECTRONICS AMERICA, INC., AND
SEIKO EPSON CORPORATION

19
20
21
22
23
24
25
26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
18
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

K&L GATES LLP

2
3

By: /s/ Ramona M. Emerson
Ramona M. Emerson

4
5

Hugh F. Bangasser (admitted pro hac vice)
Ramona M. Emerson (admitted pro hac vice)
Christopher M. Wyant (admitted pro hac vice)
925 Fourth Avenue, Suite 2900
Seattle, WA 98104
Tel: [phone]
Fax: [phone]

6
7
8
9

Jeffrey L. Bornstein (Bar No. 99358)
Four Embarcadero Center, Suite 1200
San Francisco, CA 94111
Tel: [phone]
Fax: [phone]

10
11
12

Attorneys for Defendant
HANNSTAR DISPLAY CORPORATION

13
14

MORGAN, LEWIS & BOCKIUS LLP

15
16

By: /s/ Kent M. Roger
Kent M. Roger

17
18

Kent M. Roger (Bar No. 95987)
Herman J. Hoying (Bar No. 257495)
Minna L. Naranjo (Bar No. 259005)
One Market, Spear Street Tower
San Francisco, CA 94105-1126
Tel: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]

19
20
21
22
23

Attorneys for Defendants
HITACHI, LTD., HITACHI DISPLAYS, LTD. and
HITACHI ELECTRONIC DEVICES (USA), INC.

24
25
26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
19
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

CLEARY GOTTLIEB STEEN & HAMILTON
LLP

2
3

By: /s/ Michael R. Lazerwitz
Michael R. Lazerwitz

4

Michael R. Lazerwitz (admitted pro hac vice)
Jeremy J. Calsyn (Bar No. 205062)
Lee F. Berger (Bar No. 222756)
One Liberty Plaza
New York, NY 10006
Tel: [phone]
Fax: [phone]

5
6
7
8

Attorneys for Defendants
LG DISPLAY CO, LTD, and LG DISPLAY
AMERICA INC.

9
10
11

COVINGTON & BURLING LLP

12

By: /s/ Robert D. Wick
Robert D. Wick

13
14

Robert D. Wick (admitted pro hac vice)
1201 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Tel: [phone]
Fax: [phone]

15
16
17

Attorneys for Defendants
SAMSUNG ELECTRONICS AMERICA, INC.,
SAMSUNG SEMICONDUCTOR, INC., and
SAMSUNG ELECTRONICS CO., LTD.

18
19
20

PILLSBURY WINTHROP SHAW PITTMAN LLP

21

By:_/s/ John M. Grenfell
John M. Grenfell

22

John M. Grenfell (Bar No. 88500)
50 Fremont Street
San Francisco, CA 94105
Tel: [phone]
Fax: [phone]

23
24
25

Attorneys for Defendants
SHARP CORPORATION AND SHARP
ELECTRONICS CORPORATION

26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
20
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1

WHITE & CASE LLP

2
3

By: /s/ John H. Chung
John H. Chung

4
5

John H. Chung (admitted pro hac vice)
1155 Avenue of the Americas
New York, NY 10036
Tel: [phone]
Fax: [phone]

6
7
8

Christopher M. Curran (admitted pro hac vice)
Kristen J. McAhren (admitted pro hac vice)
701 13th Street, NW
Washington, D.C. 20005
Tel: [phone]
Fax: [phone]

9
10
11

14

Attorneys for Defendants
TOSHIBA CORPORATION, TOSHIBA MOBILE
DISPLAY TECHNOLOGY CO., LTD., TOSHIBA
AMERICA INFORMATION SYSTEMS, INC.,
TOSHIBA AMERICA ELECTRONIC
COMPONENTS, INC.

15

DAVIS WRIGHT TREMAINE LLP

12
13

16
17

By: /s/ Allison A. Davis
Allison A. Davis

18

Allison A. Davis (No. 139203)
Sanjay Nangia (No. 264986)
505 Montgomery Street, Suite 800
San Francisco, CA 94111
Tel: [phone]
Fax: [phone]

19
20
21
22

Nick S. Verwolf (admitted pro hac vice)
777 – 108th Ave. N.E., Suite 2300
Bellevue, WA 98004
Tel: [phone]
Fax: [phone]

23
24
25
26

Attorneys for Defendant
SANYO CONSUMER ELECTRONICS CO., LTD.

27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
21
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT

1
2

Pursuant to General Order 45, Part X-B, the filer attests that concurrence in the filing of this
document has been obtained from the signatories to this document.

3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

261880_3.DOC

MASTER FILE NO.: 3:07-MD-1827 SI
22
CASE NO.: 3:11-cv-02591 SI
DEFENDANTS’ JOINT NOTICE OF MOTION AND MOTION TO DISMISS COMPLAINT