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

Filing 62

MOTION to Dismiss Samsung SDI Co., Ltd. and Samsung SDI America, Inc.'s (1) Notice of Motion and Motion to Dismiss T-Mobile's Claims Pursuant to California's Cartwright Act and Unfair Competition Law; and (2) Joinder in Defendants' Joint Motion to Dismiss in Part Amended Complaint filed by Samsung SDI America Inc, Samsung SDI Co Ltd. Motion Hearing set for 2/10/2012 09:00 AM in Courtroom 10, 19th Floor, San Francisco before Hon. Susan Illston. Responses due by 12/27/2011. Replies due by 1/3/2012. (Cunningham, Tyler) (Filed on 12/12/2011)

1 SHEPPARD MULLIN RICHTER & HAMPTON LLP
A Limited Liability Partnership
2
Including Professional Corporations
GARY L. HALLING, Cal. Bar No. 66087
3 JAMES L. McGINNIS, Cal. Bar No. 95788
MICHAEL W. SCARBOROUGH, Cal. Bar No. 203524
4 MONA SOLOUKI, Cal. Bar No. 215145
TYLER M. CUNNINGHAM, Cal. Bar No. 243694
5 Four Embarcadero Center, 17th Floor
San Francisco, California 94111-4106
6 Telephone: [phone]
Facsimile:
415-434-3947
7 E-mail:
[e-mail]
[e-mail]
8
[e-mail]
[e-mail]
9
[e-mail]
10 Attorneys for Defendants
SAMSUNG SDI CO., LTD. and
11 SAMSUNG SDI AMERICA, INC.
12
13

UNITED STATES DISTRICT COURT

14

NORTHERN DISTRICT OF CALIFORNIA

15

SAN FRANCISCO DIVISION

16
17 In re: TFT-LCD (FLAT PANEL)
ANTITRUST LITIGATION
18

Master Docket No. M:07-cv-1827-SI

19 This Document Relates to: 3:11-cv-02591-SI

SAMSUNG SDI CO., LTD. AND
SAMSUNG SDI AMERICA, INC.'S:

(Case No. 3:11-cv-02591-SI)

20
T-MOBILE U.S.A., INC.,

(1) NOTICE OF MOTION AND MOTION
TO DISMISS T-MOBILE'S CLAIMS
PURSUANT TO CALIFORNIA'S
CARTWRIGHT ACT AND UNFAIR
COMPETITION LAW; AND

21
Plaintiffs,
22
vs.
23
AU OPTRONICS CORPORATION, et al.,
24
Defendants.
25

(2) JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART
AMENDED COMPLAINT
Date:
Time:
Ctrm:
Judge:

26
27

February 10, 2012
9:00 a.m.
10
Hon. Susan Illston

28
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

TABLE OF CONTENTS

2

Page

3 NOTICE OF MOTION AND MOTION .......................................................................................... 1
4 STATEMENT OF THE ISSUES ...................................................................................................... 1
5 MEMORANDUM OF POINTS AND AUTHORITIES .................................................................. 1
6 I.

INTRODUCTION................................................................................................................. 1

7 II.

BACKGROUND AND ALLEGATIONS OF THE COMPLAINT ..................................... 2

8 III.

ARGUMENT ........................................................................................................................ 3

9

A.

10

Plaintiff's Claims Against SDI Under California's Cartwright Act And
Unfair Competition Law Are Barred By Four-Year Statutes Of Limitation. ........... 3

11

1.

The Court may properly dismiss claims pursuant to Rule 12(b)(6)
when the complaint reveals the claims to be time-barred. ............................ 3

2.

Plaintiff's Cartwright Act and UCL claims against SDI are timebarred because they were commenced more than four years after any
such claim accrued. ....................................................................................... 4

3.

16

Plaintiff's Cartwright Act and UCL claims against SDI cannot be
saved by allegations of fraudulent concealment or any tolling
doctrine.......................................................................................................... 5

17

a.

Fraudulent concealment .................................................................... 5

18

b.

Class-action tolling............................................................................ 7

19

c.

Government-action tolling ................................................................ 8

20

d.

Continuing conspiracy....................................................................... 8

21

e.

Equitable estoppel ........................................................................... 10

12
13
14
15

22

4.

23

None of the Court's prior rulings regarding statutes of limitation help
Plaintiff here................................................................................................ 11

24

B.

SDI Joins In Defendants' Joint Motion To Dismiss. ............................................... 12

25 IV.

CONCLUSION ................................................................................................................... 12

26
27
28
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1
TABLE OF AUTHORITIES
2
Page(s)

3

FEDERAL CASES

4 American Pipe and Construction Co. v. Utah
414 U.S. 538 (1974) .................................................................................................................. 7
5
6 Ariz. Elec. Power Co-op. v. United States
816 F.2d 1366 (9th Cir. 1987)................................................................................................... 9
7
Arneil v. Ramsey
8
550 F.2d 774 (2d Cir. 1977) ...................................................................................................... 7
9 Boone v. Citigroup, Inc.
416 F.3d 382 (5th Cir. 2005)..................................................................................................... 7
10
11 Crowe v. Wiltel Comm. Sys.
103 F.3d 897 (9th Cir. 1996)..................................................................................................... 3
12
Crown, Cork & Seal Co., Inc. v. Parker
13
462 U.S. 345 (1983) .................................................................................................................. 7
14 E.W. French & Sons v. General Portland, Inc.
885 F.2d 1392 (9th Cir. 1989)................................................................................................... 4
15
16 Guaranty Trust Co. of New York v. York
326 U.S. 99 (1945) .................................................................................................................... 3
17
Hanson v. Shell Oil Co.
541 F.2d 1352 (9th Cir. 1976)................................................................................................... 4
18
19 Jablon v. Dean Witter & Co.
614 F.2d 677 (9th Cir. 1980)..................................................................................................... 3
20
In re Microsoft Corp. Antitrust Litig.
21
No. MDL 1332, Civ. JFM-04-3705, 2005 WL 906364
(D. Md. Apr. 18, 2005).............................................................................................................. 9
22
23 Nashville Milk Co. v. Carnation Co.
355 U.S. 373 (1958) .................................................................................................................. 8
24
In re Petroleum Prods. Antitrust Litig.
25
782 F.Supp. 481 (C.D. Cal. 1991)............................................................................................. 8
26 Pool Water Prods. v. Olin Corp.
258 F.3d 1024 (9th Cir. 2001)................................................................................................... 8
27
28
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 In re TFT-LCD (Flat Panel) Antitrust Litig.
Nos. M 07-1827 SI, C 11-0829 SI, 2011 U.S. Dist. LEXIS 124164
2
(N.D. Cal. Oct. 26, 2011) .................................................................................................... 6, 12
3 In re TFT-LCD (Flat Panel) Antitrust Litig.
Nos. M 07-1827 SI, C 09-5840 SI, 2011 U.S. Dist. LEXIS 131812
4
(N.D. Cal. Nov. 14, 2011) ....................................................................................................... 11
5
In re TFT-LCD Antitrust Litig.
6
586 F.Supp.2d 1109 (N.D. Cal. 2008) .................................................................................... 12
7 Weisbuch v. County of Los Angeles
119 F.3d 778 (9th Cir. 1997)..................................................................................................... 3
8
In re Worldcom Securities
9
496 F.3d 245 (2d Cir. 2007) ...................................................................................................... 8
10
Wyser-Pratte Management Co. v. Telxon Corp.
413 F.3d 553 (6th Cir. 2005)..................................................................................................... 7
11
12 Zenith Radio Corp. v. Hazeltine Research, Inc.
401 U.S. 321 (1971) .................................................................................................................. 4
13
STATE CASES
14
15 Aryeh v. Canon Business Solutions, Inc.
185 Cal.App.4th 1159 (2010), review granted........................................................................ 10
16
Chalmers v. County of Los Angeles
175 Cal.App.3d 461 (1985)..................................................................................................... 10
17
18 Chicago Title Ins. Co. v. Great Western Fin. Corp.
69 Cal. 2d 305 (Cal. 1968) ........................................................................................................ 4
19
E-Fab, Inc. v. Accountants, Inc. Servs.
20
153 Cal.App.4th 1308 (Cal. Ct. App. 2007) ............................................................................. 7
21
Gamboa v. Atchison, Topeka & Santa Fe Railway Co.
20 Cal.App.3d 61 (1971)......................................................................................................... 10
22
23 Javor v. Taggart
98 Cal.App.4th 795 (2002)...................................................................................................... 10
24
Jolly v. Eli Lilly & Co.
25
44 Cal.3d 1103 (1998)............................................................................................................... 5
26

Kunstman v. Mirizzi
234 Cal.App.2d 753 (1965)..................................................................................................... 10
27
28 Lantzy v. Centex Homes
31 Cal.4th 363 (2003).............................................................................................................. 10
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 People ex rel. Lockyer v. R.J. Reynolds Tobacco Co.
37 Cal. 4th 707 (2006)............................................................................................................... 9
2
Snapp & Associates Insurance Services, Inc. v. Malcolm Bruce Burlingame Robertson
3
96 Cal.App.4th 884 (2002) .......................................................................................... 5, 6, 9, 10
4

FEDERAL STATUTES, RULES, & REGULATIONS

5

Federal Rules of Civil Procedure
Rule 12(b)(6) ......................................................................................................................... 1, 3
6
7 15 United States Code
§ 16(i) ........................................................................................................................................ 8
8
§ 12 (“Cartwright Act”)............................................................................................................. 8
9

STATE STATUTES, RULES, & REGULATIONS

10

California Business & Professions Code
§ 16720, et seq....................................................................................................................... 1, 2
11
§ 16750.1............................................................................................................................... 4, 9
12
§ 16755...................................................................................................................................... 9
§ 17200, et seq....................................................................................................................... 1, 2
13
§ 17208...................................................................................................................................... 4
14

New York Gen. Bus. Law
§§ 340, et seq. (“Donnelly Act”)............................................................................................... 2
15
16
17
18
19
20
21
22
23
24
25
26
27
28
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

NOTICE OF MOTION AND MOTION

2 TO ALL PARTIES AND THEIR COUNSEL OF RECORD:
3

PLEASE TAKE NOTICE that on February 10, 2012, at 9:00 a.m. or as soon thereafter as

4 this matter may be heard, in the Courtroom of the Honorable Susan Illston, United States District
5 Judge of the Northern District of California located at 450 Golden Gate Avenue, San Francisco,
6 California, defendants Samsung SDI Co., Ltd. and Samsung SDI America, Inc. (together, "SDI")
7 will, and hereby do, move this Court, pursuant to Rule 12(b)(6) of the Federal Rules of Civil
8 Procedure, for an order partially dismissing plaintiff T-Mobile U.S.A., Inc. ("Plaintiff")'s claims
9 against SDI as stated in T-Mobile's Amended Complaint for Damages and Injunctive Relief
10 ("FAC"), for the reasons stated in Defendants' Joint Notice of Motion and Motion to Dismiss in
11 Part Amended Complaint ("Joint Motion to Dismiss"), MDL Docket No. 4322. In addition, SDI
12 separately moves this Court, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, for
13 an order dismissing as time-barred Plaintiff's claims against SDI pursuant to California's
14 Cartwright Act, Cal. Bus. & Prof. Code § 16720, et seq., and Unfair Competition Law, Cal. Bus.
15 & Prof. Code § 17200, et seq. ("UCL"). This motion is based upon this Notice of Motion and
16 accompanying Memorandum of Points and Authorities, the Joint Motion to Dismiss, the complete
17 files in these actions, argument of counsel, and such other matters as the Court may consider.
18

STATEMENT OF THE ISSUES

19

1.

Whether Plaintiff's claims for relief against SDI pursuant to California's Cartwright

20 Act, Cal. Bus. & Prof. Code § 16720, et seq., and Unfair Competition Law, Cal. Bus. & Prof.
21 Code § 17200, et seq., as stated in the FAC, are barred by the applicable statutes of limitation.
22

2.

Whether Plaintiff's FAC should be dismissed as to SDI for the reasons set forth in

23 Defendants' Joint Motion to Dismiss.
24

MEMORANDUM OF POINTS AND AUTHORITIES

25 I.

INTRODUCTION

26

SDI joins in all arguments asserted by defendants in the concurrently filed Joint Motion to

27 Dismiss. SDI files this separate motion to dismiss because, unlike most (if not all) other
28 defendants, it was not named as a defendant in the class action cases filed in the associated multi-1W02-WEST:5TMC1\404196579.3
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 district litigation. Those class actions therefore cannot toll any statute of limitations as to any
2 claim against SDI. Plaintiff's Cartwright Act and UCL claims are governed by four-year statutes
3 of limitation. Yet Plaintiff did not file suit until April 2011, more than four years after widespread
4 publicity of the alleged antitrust conspiracy. As this Court has held, this public announcement
5 started the clock running on the limitations period. Although the FAC invokes a host of tolling
6 provisions, none of them save Plaintiff's time-barred claims against SDI. Because Plaintiff waited
7 more than four years to file its Cartwright Act and UCL claims against SDI, these claims should
8 be dismissed.
9 II.
10

BACKGROUND AND ALLEGATIONS OF THE COMPLAINT
Plaintiff is a business that purchased and sold mobile wireless handsets containing LCD

11 panels. FAC ¶ 1. Plaintiff claims that it acquired or received stock of other companies that also
12 purchased mobile wireless handsets containing LCD panels. Id. ¶ 23. Plaintiff alleges that, from
13 January 1, 1996 to December 11, 2006, defendants conspired to fix the price of the LCD panels in
14 those handsets. Id. ¶¶ 2, 21, 281. As a result, Plaintiff claims that it was injured by paying
15 artificially high prices for the handsets that it purchased from January 1, 1996 to December 11,
16 2006. Id. ¶¶ 8, 21, 24. Plaintiff seeks relief under Section One of the Sherman Act; sections 4 and
17 16 of the Clayton Act; California's Cartwright Act, Cal. Bus. & Prof. Code §§ 16720, et seq.;
18 California's Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200, et seq.; and New York's
19 Donnelly Act, N.Y. Gen. Bus. Law §§ 340, et seq.
20

According to the FAC, the alleged conspiracy was publicly revealed in December 2006,

21 when the U.S. Department of Justice ("DOJ") and antitrust authorities in Japan, South Korea and
22 the European Union "revealed the existence of a comprehensive investigation into anti23 competitive activity among LCD Panel manufacturers." Id. ¶ 174. At least one defendant
24 disclosed in a public filing with the Securities and Exchange Commission that the DOJ had
25 subpoenaed its office in connection with the investigation. Id. Media outlets also reported the
26 alleged conspiracy in December 2006, indicating that the government investigation targeted
27 Samsung, Sharp and AU Optronics. Id. ¶ 175. Through all of these public reports, Plaintiff was
28 notified in December 2006 of the existence of the alleged LCD conspiracy. Id. ¶ 274.
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

Plaintiff filed its original complaint in the U.S. District Court for the Western District of

2 Washington on April 18, 2011. Complaint for Damages and Injunctive Relief, No. 3:11-cv-02591
3 (filed April 18, 2011). The action was transferred to this Court for purposes of coordination of
4 pre-trial proceedings. Defendants jointly moved to dismiss that complaint on September 15, 2011.
5 MDL Dkt. No. 3592. SDI joined in that motion, and separately moved to dismiss Plaintiff's
6 claims under California law based on the applicable statutes of limitation. MDL Dkt. No. 3602.
7 On October 3, 2011, the parties filed a stipulation allowing Plaintiff to file the FAC, and setting a
8 timetable for defendants to respond. MDL Dkt. No. 3779. Plaintiff filed its FAC on November 7,
9 2011.
10 III.

ARGUMENT

11

A.

Plaintiff's Claims Against SDI Under California's Cartwright Act And Unfair

12

Competition Law Are Barred By Four-Year Statutes Of Limitation.

13

1.

14
15

The Court may properly dismiss claims pursuant to Rule 12(b)(6) when
the complaint reveals the claims to be time-barred.

A court may properly dismiss a claim pursuant to Federal Rule of Civil Procedure 12(b)(6)

16 when the complaint itself discloses an absolute defense or bar to recovery. Weisbuch v. County of
17 Los Angeles, 119 F.3d 778, 783 n.1 (9th Cir. 1997). In particular, a motion to dismiss is a proper
18 vehicle to dismiss claims where the facts and dates alleged in the complaint indicate that the claim
19 is barred by the statute of limitations. Jablon v. Dean Witter & Co., 614 F.2d 677, 682 (9th Cir.
20 1980) ("If the running of the statute is apparent on the face of the complaint, the defense may be
21 raised by a motion to dismiss."). When a federal court exercises supplemental jurisdiction over a
22 state law claim, the district court follows state law in deciding the substantive issues before the
23 court. Crowe v. Wiltel Comm. Sys., 103 F.3d 897, 899 (9th Cir. 1996). Accordingly, where a
24 statute of limitations could bar recovery in a state court, the district court applies the same statute
25 of limitations as the state court would apply. See Guaranty Trust Co. of New York v. York, 326
26 U.S. 99, 110 (1945).
27
28
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

2.

Plaintiff's Cartwright Act and UCL claims against SDI are time-barred

2

because they were commenced more than four years after any such claim

3

accrued.

4

Both the Cartwright Act and the UCL have four-year statutes of limitation. Cal. Bus. &

5 Prof. Code §§ 16750.1, 17208. A cause of action for an antitrust violation generally accrues when
6 the plaintiff suffers injury. When a plaintiff alleges an ongoing price-fixing conspiracy, a new
7 cause of action arises from each resulting injury. Zenith Radio Corp. v. Hazeltine Research, Inc.,
8 401 U.S. 321, 338 (1971) ("In the context of a continuing conspiracy to violate the antitrust laws
9 ... each time a plaintiff is injured by an act of the defendants a cause of action accrues to him to
10 recover the damages caused by that act.").1 Accordingly, Plaintiff here accrued new alleged
11 claims with each purchase. Those claims expired serially, four years after each purchase. See,
12 e.g., E.W. French & Sons v. General Portland, Inc., 885 F.2d 1392, 1396 (9th Cir. 1989) (plaintiff
13 alleging price-fixing conspiracy may recover only for claims that accrued four years before the
14 complaint was filed and thereafter); Hanson v. Shell Oil Co., 541 F.2d 1352, 1361 (9th Cir. 1976)
15 ("a plaintiff may recover for acts violative of the antitrust laws committed prior to the statute of
16 limitations date, but … he may only recover those damages for such acts which accrued and
17 became ascertainable within the period of the statute.").
18

Plaintiff first sued SDI on April 18, 2011. Therefore, all of Plaintiff's claims against SDI

19 under the Cartwright Act and UCL based on purchases made before April 18, 2007 are untimely.
20 But Plaintiff does not claim any injury as late as April 2007. Indeed, Plaintiff claims only that it
21 was injured by purchases made within the "Conspiracy Period," which ended in December 2006.
22 See, e.g., FAC ¶¶ 21, 22, 24, 27, 296. Therefore, absent application of some tolling principle, all
23 of Plaintiff's claims against SDI under the Cartwright Act and the UCL are untimely.
24
25
26
27
1
California
applying
28 e.g., Chicagocourts Ins. Co. v.the Cartwright Act look to federal antitrust law for guidance. See,
Title
Great Western Fin. Corp., 69 Cal. 2d 305, 315 (Cal. 1968).

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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

3.

2
3

Plaintiff's Cartwright Act and UCL claims against SDI cannot be saved by
allegations of fraudulent concealment or any tolling doctrine.

Plaintiff alleges that a variety of tolling doctrines save its claims from the statutes of

4 limitation, including fraudulent concealment, class-action tolling, government-action tolling,
5 continuing conspiracy, and equitable estoppel. FAC ¶¶ 274-279. As described below, none of
6 these doctrines save Plaintiff's Cartwright Act or UCL claims against SDI.
7
8

a.

Fraudulent concealment

Plaintiff's fraudulent concealment allegations cannot rescue its time-barred claims, because

9 the FAC itself reveals that Plaintiff knew or should have known of these claims more than four
10 years before it filed suit. Under California law, fraudulent concealment ceases to toll the statute of
11 limitations when plaintiff discovers, or in the exercise of reasonable diligence should have
12 discovered, its claim. Bernson v. Browning-Ferris Indus., 7 Cal.4th 926, 931 (1994); see also
13 Snapp & Associates Insurance Services, Inc. v. Malcolm Bruce Burlingame Robertson, 96
14 Cal.App.4th 884, 890-91 (2002) ("The fraudulent concealment doctrine does not come into play,
15 whatever the lengths to which a defendant has gone to conceal the wrongs, if a plaintiff is on
16 notice of a potential claim.") (internal quotations omitted); Jolly v. Eli Lilly & Co., 44 Cal.3d
17 1103, 1111 (1998) (plaintiff "need not be aware of the specific 'facts' necessary to establish the
18 claim"; statute of limitations begins to run once plaintiff has a "suspicion of wrongdoing").
19

Here, the FAC itself shows definitively that Plaintiff was on notice of its claim more than

20 four years before it filed suit. Plaintiff affirmatively alleges that the U.S. Department of Justice's
21 investigation of the alleged conspiracy became public in December 2006. FAC ¶¶ 174, 175, 274.
22 The FAC describes the December 2006 public announcement by "authorities in Japan, South
23 Korea, the European Union, and the United States" concerning "a comprehensive investigation
24 into anti-competitive activity among LCD Panel manufacturers." Id. ¶ 174. The FAC also
25 describes defendant LG Display's December 11, 2006 public filing with the Securities and
26 Exchange Commission, which revealed that the company had been visited by South Korean and
27 Japanese Fair Trade Commission officials, and had received a subpoena from the Department of
28 Justice. Id. Plaintiff also admits that "news reports" as early as December 12, 2006 revealed that
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 "defendants Samsung, Sharp, and AU Optronics were also under investigation." Id. ¶ 175. Soon
2 after these public revelations, civil plaintiffs began filing lawsuits against many of the same
3 defendants sued herein. FAC ¶ 279.
4

If there is any doubt that these public announcements notified Plaintiff of the claims it

5 seeks to assert, Plaintiff itself affirmatively alleges as much. FAC ¶ 274 ("T-Mobile did not
6 discover and could not have discovered, through the exercise of reasonable diligence, the
7 existence of the conspiracy alleged herein until after December of 2006, when the existence of the
8 investigations by the DOJ and other antitrust regulators became public …."). Thus, the FAC itself
9 alleges that Plaintiff had discovered the conspiracy, or at a minimum should had discovered it
10 using reasonable diligence, in December 2006. Any fraudulent concealment, and thus any tolling,
11 ended by that date – more than four years before Plaintiff sued SDI.
12

This Court recently examined very similar allegations of fraudulent concealment in the

13 MetroPCS Wireless case, and concluded that the statute of limitations on a state antitrust claim
14 began to run when "the DOJ disclosed its investigation on December 11, 2006." In re TFT-LCD
15 (Flat Panel) Antitrust Litig., Nos. M 07-1827 SI, C 11-0829 SI, 2011 U.S. Dist. LEXIS 124164, at
16 *23-*25 (N.D. Cal. Oct. 26, 2011). The Court held that, absent some further tolling, plaintiffs'
17 claims were time-barred. Id. The Court ultimately found that plaintiffs' claims were saved by a
18 tolling provision peculiar to Illinois law, and not applicable to Plaintiff's UCL and Cartwright Act
19 claims. Id. at *26. The same analysis, applied here, dictates that Plaintiff's time-barred claims are
20 not saved by its fraudulent concealment allegations.
21

Even if the Court were to conclude (contrary to its prior order in MetroPCS and Plaintiff's

22 own allegations) that the December 2006 public revelation of government antitrust investigations
23 somehow did not give Plaintiff sufficient notice to start the limitations period, Plaintiff's
24 fraudulent concealment allegations would still fail because it has not adequately pleaded that it
25 diligently pursued its claims after receiving notice. California requires a plaintiff seeking to toll a
26 statute of limitations on grounds of fraudulent concealment to allege that they diligently tried to
27 discover the facts underlying their claim. Snapp, 96 Cal.App.4th at 890. But Plaintiff here makes
28 no such allegation. Plaintiff alleges that it "could not have discovered, through the exercise of
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CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 reasonable diligence, the existence of the conspiracy alleged herein until after December of 2006
2 …." FAC ¶ 274. Yet Plaintiff does not allege that it diligently pursued its claims after this point,
3 and thus cannot rely on the fraudulent concealment doctrine to toll the statute of limitations after
4 that date. See, e.g., E-Fab, Inc. v. Accountants, Inc. Servs., 153 Cal.App.4th 1308, 1319 (Cal. Ct.
5 App. 2007) ("[t]he burden is on the plaintiff to show diligence, and conclusory allegations will not
6 withstand demurrer") (quotation omitted).
7
8

b.

Class-action tolling

The LCD class actions do not toll the applicable statutes of limitation on Plaintiff's claims

9 against SDI, for the simple reason that SDI was never named as a defendant in those class actions.
10 In announcing the class-tolling principle, the U.S. Supreme Court stated that tolling does not thwart
11 the purpose of statutes of limitation, nor deprive defendants of essential fairness, only because the
12 class action itself notifies the class defendants of the claims against them during the limitations
13 period. See, e.g., American Pipe and Construction Co. v. Utah, 414 U.S. 538, 555 (1974) (class
14 action provides defendants named therein with "the essential information necessary to determine
15 both the subject matter and size of the prospective litigation" during the limitation period); see also
16 Crown, Cork & Seal Co., Inc. v. Parker, 462 U.S. 345, 352-353 (1983). For this reason, a group of
17 concurring justices explicitly cautioned district courts not to toll the statute of limitations for claims
18 that are "different [from] or peripheral [to]" the class action claims. Id. at 354-55 (Powell, J.,
19 concurring) ("Claims as to which the defendant was not fairly placed on notice by the class suit are
20 not protected under American Pipe and are barred by the statute of limitations.").
21

Accordingly, a class action does not toll a statute of limitations as to claims against a

22 defendant not named in the class action. See, e.g., Boone v. Citigroup, Inc., 416 F.3d 382, 392
23 (5th Cir. 2005) ("it is facially obvious" that pendency of a class action does not toll statute of
24 limitations as to defendants not named in class action); Wyser-Pratte Management Co. v. Telxon
25 Corp., 413 F.3d 553, 567-68 (6th Cir. 2005) (plaintiff may not rely on class action tolling to
26 suspend statute of limitations on claims against defendant, where defendant was not named in
27 class action); Arneil v. Ramsey, 550 F.2d 774, 782 n.10 (2d Cir. 1977) ("nothing in American Pipe
28 suggests that the statute be suspended from running in favor of a person not named as a defendant
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Case No. 3:11-cv-02591-SI

SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 in the class suit, and we decline so to extend the rule."), reversed on other grounds as stated in
2 In re Worldcom Securities, 496 F.3d 245, 254 n.6 (2d Cir. 2007).
3

SDI has never been named as a defendant in any LCD class action. See MDL Dkt. Nos.

4 267, 303, 366, 367, 746, 748, 874, 1407 (consolidated direct and indirect purchaser class
5 complaints). Such class actions thus did not toll the statutes of limitation on Plaintiff's claims
6 against SDI.
7
8

c.

Government-action tolling

Plaintiff alleges that the applicable statutes of limitation "have also been tolled as a result

9 of the criminal informations and guilty pleas …." FAC ¶ 276. But Plaintiff's Cartwright Act and
10 UCL claims are not rescued by any such government action. Plaintiff's allegation is an apparent
11 reference to a federal Clayton Act provision that reads, in pertinent part:
12
13
14
15

Whenever any civil or criminal proceeding is instituted by the
United States to prevent, restrain, or punish violations of any of the
antitrust laws, but not including an action under section 15a of this
title, the running of the statute of limitations in respect to every
private or State right of action arising under said laws and based in
whole or in part on any matter complained of in said proceeding
shall be suspended during the pendency thereof and for one year
thereafter . . .

16
17 15 U.S.C. § 16(i) (emphasis added). The statute thus provides for tolling only as to rights of action
18 "arising under" the "antitrust laws." The term "antitrust laws," as used in the Clayton Act, is
19 defined to mean a specific list of federal antitrust statutes, and does not encompass the UCL or
20 Cartwright Act. 15 U.S.C. § 12; See Nashville Milk Co. v. Carnation Co., 355 U.S. 373, 376
21 (1958) ("the definition contained in [Section] 1 of the Clayton Act is exclusive"; that a statute not
22 listed therein "may be colloquially described as an 'antitrust' statute" is "of no moment."); Pool
23 Water Prods. v. Olin Corp., 258 F.3d 1024, 1031 n.4 (9th Cir. 2001); In re Petroleum Prods.
24 Antitrust Litig., 782 F.Supp. 481, 484 (C.D. Cal. 1991). Because these claims do not "arise under"
25 the "antitrust laws," they cannot benefit from the government tolling provision of 15 U.S.C. § 16(i).
26
27

d.

Continuing conspiracy

Plaintiff alleges that defendants' conduct constitutes a "continuing tort, and therefore the

28 statute of limitations cannot accrue until the last act of defendants' violative conduct." FAC ¶ 278.
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Case No. 3:11-cv-02591-SI

SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 This paragraph appears to be an attempt to invoke the continuing violation doctrine, or "last overt
2 act" rule, under which a defendant may be held liable for actions that take place outside the
3 limitations period if those actions are sufficiently linked to unlawful conduct within the limitations
4 period. Even if this doctrine applied to Plaintiff's California claims (which it does not), it would
5 not rescue them from the statutes of limitation, because the FAC alleges no overt act later than
6 December 2006. Indeed, the FAC defines the "Conspiracy Period" as ending in 2006. FAC ¶¶ 1,
7 21. The FAC alleges conduct by defendants only within that "Conspiracy Period." See, e.g., FAC
8 ¶¶ 2, 6, 8, 22-77, 92-95, 97, 105-120, 122. Plaintiff filed suit more than four years after the latest
9 "violative conduct" alleged in the FAC, and thus its claims under the Cartwright Act and UCL are
10 time-barred even under its own articulation of the rule.
11

Moreover, Plaintiff is wrong as a matter of law. Neither the Cartwright Act nor the UCL

12 are governed by the "last overt act" rule. While the Cartwright Act does contain a "last overt act"
13 rule, it is reserved for criminal actions. Cal. Bus. & Prof. Code § 16755 ("Any action pursuant to
14 this section may be commenced at any time within four years after the commission of the last act
15 comprising a part of any violation."). In contrast, the civil statute is not based on the last overt act.
16 Cal. Bus. & Prof. Code § 16750.1 ("Any civil action to enforce any cause of action for a violation
17 of this chapter shall be commenced within four years after the cause of action accrued."). It is a
18 fundamental rule of statutory construction that "[w]hen the legislature uses materially different
19 language in statutory provisions addressing the same subject or related subjects, the normal
20 inference is that the Legislature intended a difference in meaning." People ex rel. Lockyer v. R.J.
21 Reynolds Tobacco Co., 37 Cal. 4th 707, 717 (2006); see also Ariz. Elec. Power Co-op. v. United
22 States, 816 F.2d 1366, 1375 (9th Cir. 1987) ("When Congress includes a specific term in one
23 section of a statute but omits it in another section of the same Act, it should not be implied where
24 it is excluded."). The only reasonable conclusion is that the "last overt act" rule does not apply to
25 civil Cartwright Act claims. Indeed, the only decision that has ever addressed the issue so held.
26 See In re Microsoft Corp. Antitrust Litig., No. MDL 1332, Civ. JFM-04-3705, 2005 WL 906364,
27 at *3 (D. Md. Apr. 18, 2005) (granting motion to dismiss based on statute of limitations).
28 Similarly, the "last overt act" rule does not apply to a cause of action under the UCL. Snapp, 96
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Case No. 3:11-cv-02591-SI

SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 Cal.App.4th at 890-891.2
2

e.

3

Equitable estoppel

Plaintiff alleges that "as a result of defendants' fraudulent concealment of the Conspiracy,

4 defendants are equitably estopped from asserting statutes of limitation defense [sic]." FAC ¶ 277.
5 But Plaintiff alleges no new facts to support the theory. As described above, Plaintiff's fraudulent
6 concealment allegations fail because the FAC shows that Plaintiff was on notice of its claim by
7 December 2006. See pp. 5-7, supra. These same allegations fare no better when labeled "equitable
8 estoppel." See Javor v. Taggart, 98 Cal.App.4th 795, 804 (2002) (affirming order sustaining
9 demurrer; equitable estoppel does not apply where plaintiff was aware of the alleged wrong);
10 Kunstman v. Mirizzi, 234 Cal.App.2d 753, 758 (1965) (affirming order sustaining demurrer;
11 equitable estoppel does not apply where the complaint reveals plaintiff had notice of its claim).
12

Moreover, the facts alleged in the FAC simply do not fit Plaintiff's equitable estoppel

13 theory. Equitable estoppel applies when a plaintiff is aware of its claim during the statutory
14 period, but is lulled into inaction by a defendant's misrepresentations. To invoke the doctrine, a
15 compliant must allege facts showing that: the defendant misrepresented the necessity of bringing a
16 timely suit; plaintiff reasonably relied on the misrepresentation and refrained from bringing a
17 timely action; the representation proved false after the limitations period has expired; and plaintiff
18 proceeded diligently once the truth is discovered. Lantzy v. Centex Homes, 31 Cal.4th 363, 38419 385 & n.18 (2003) (complaint fails to allege basis for estoppel because it is "devoid of any
20 indication that defendants' conduct actually and reasonably induced plaintiffs to forbear suing …")
21 (emphasis omitted).3 The FAC alleges nothing of the sort. It identifies no false statement by SDI
22
23
24
25
26
27
28

2

This issue is currently pending before the California Supreme Court. Aryeh v. Canon Business
Solutions, Inc., 185 Cal.App.4th 1159 (2010), review granted Oct. 20, 2010, S184929. Until a
decision is rendered in Aryeh, the Court of Appeals opinion in Snapp controls on this point.
3
See also Jarvor, 98 Cal.App.4th at 804 (2002) (complaint failed to allege equitable estoppel
because it lacked allegation that plaintiff relied on any "statement or action by [defendant] in
deciding when to file suit."); Chalmers v. County of Los Angeles, 175 Cal.App.3d 461, 467 (1985)
("the elements of estoppel must be especially pleaded in the complaint with sufficient accuracy to
disclose facts relied upon"; complaint fails to allege estoppel because it "contains no facts about
being misled or detrimental reliance."); Gamboa v. Atchison, Topeka & Santa Fe Railway Co., 20
Cal.App.3d 61, 66 (1971) (complaint failed to allege "that defendant induced plaintiff not to file
his lawsuit.").
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SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1 whatsoever, let alone a statement that persuaded Plaintiff to delay in filing its suit after it became
2 aware of its claim. Plaintiff's estoppel theory thus fails for two reasons: The FAC fails to allege
3 any facts supporting the theory, and it affirmatively negates the theory by alleging that Plaintiff
4 had notice of its claim more than four years before it filed suit.
5

4.

6
7

None of the Court's prior rulings regarding statutes of limitation help
Plaintiff here.

Most of the Court's prior opinions concerning statutes of limitation do not address the

8 situation present here, where a Plaintiff has affirmatively pleaded that it discovered its alleged
9 conspiracy outside the limitations period. For example, the Court recently denied SDI's motion to
10 dismiss Motorola's claim for breach of contract on statute-of-limitations grounds. In re TFT-LCD
11 (Flat Panel) Antitrust Litig., Nos. M 07-1827 SI, C 09-5840 SI, 2011 U.S. Dist. LEXIS 131812
12 (N.D. Cal. Nov. 14, 2011). In that order, the Court relied on a provision particular to the Illinois
13 Commercial Code, which provides that alleged fraudulent concealment extends the statute of
14 limitations to five years after the plaintiff discovers its cause of action. Id. at *6-*7. The Court
15 found that Motorola's claim was timely, because it had sued within five years of November 2006 –
16 the date that Motorola alleged that it learned of the government investigations. Id. Applied to this
17 case, that same analysis would dictate that the Court dismiss Plaintiff's Cartwright Act and UCL
18 claims, because those claims carry four-year statutes of limitations, they do not contain provisions
19 similar to the Illinois statute, and Plaintiff did not sue SDI until more than four years after it
20 learned of the government investigations.
21
22
23
24
25
26
27
28
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Case No. 3:11-cv-02591-SI

SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT

1

Neither can Plaintiff rely on any of the Court's earlier orders on limitations issues. Those

2 orders generally rejected defendants' arguments that plaintiffs failed to properly allege fraudulent
3 concealment, and therefore could not avail themselves of the doctrine. See, e.g., In re TFT-LCD
4 Antitrust Litig., 586 F.Supp.2d 1109, 1119-1120 (N.D. Cal. 2008). SDI does not challenge
5 Plaintiff's allegations, but rather accepts them as true for purposes of this motion. This includes
6 Plaintiff's allegations that it discovered the alleged conspiracy in December 2006. As discussed
7 supra, when confronted with similar allegations in the MetroPCS case, the Court held that the
8 statute of limitations began to run on the date the DOJ investigation became public. In re TFT9 LCD (Flat Panel) Antitrust Litig., Nos. M 07-1827 SI, C 11-0829 SI, 2011 U.S. Dist. LEXIS
10 124164, at *23-*25 (N.D. Cal. Oct. 26, 2011); p. 9, supra. Plaintiff here waited more than four
11 years after this key date to sue SDI; and its Cartwright Act and UCL claims are thus time-barred.
12

B.

13

In addition, SDI hereby joins in Defendants' Joint Motion to Dismiss in PartAmended

SDI Joins In Defendants' Joint Motion To Dismiss.

14 Complaint, filed concurrently.
15 IV.

CONCLUSION

16

For the foregoing reasons, Plaintiff's claims against SDI pursuant to the Cartwright Act and

17 UCL should be dismissed. In addition, for all the reasons stated in Defendants' Joint Motion to
18 Dismiss, Plaintiff's Amended Complaint should be dismissed in its entirety as to SDI.
19 Dated: December 12, 2011

SHEPPARD, MULLIN, RICHTER & HAMPTON LLP

20
21
By

22

/s/ Tyler M. Cunningham
TYLER M. CUNNINGHAM

23
Attorneys for Defendants
SAMSUNG SDI CO., LTD. and
SAMSUNG SDI AMERICA, INC.

24
25
26
27
28
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Case No. 3:11-cv-02591-SI

SAMSUNG SDI'S MOTION TO DISMISS T-MOBILE'S CALIFORNIA
CLAIMS AND JOINDER IN DEFENDANTS' JOINT
MOTION TO DISMISS IN PART AMENDED COMPLAINT