{ "attribution": { "source": "legal.exploreworldai.com", "canonical": "https://legal.exploreworldai.com/api/public/v1/judgment-text?id=us:ca9-24-4470-2026-01-08", "cite_as": "NovaCopilot, legal.exploreworldai.com (https://legal.exploreworldai.com/api/public/v1/judgment-text?id=us:ca9-24-4470-2026-01-08)", "license": "https://legal.exploreworldai.com/revision", "version": "legal-2026-10-20", "fingerprint": "ewai:us:49b4aa", "proof": "sha256:3b7162d227656b6edf65117c37aba59e78c37c43cd4bdab96807b255855951de", "jurisdiction": "us", "lang": "en", "publisher": "NovaCopilot by ExploreWorld Legal", "terms": "https://legal.exploreworldai.com/om" }, "brand_source": "Source: NovaCopilot", "item": { "schema_version": "1.0.0", "id": "us:ca9-24-4470-2026-01-08", "jurisdiction": "us", "lang": "en", "brand_source": "Source: NovaCopilot", "brand": { "product": "NovaCopilot", "platform": "ExploreWorldAI", "infrastructure": "ExploreWorld Legal", "infrastructure_url": "legal.exploreworldai.com", "legal_entity": "Valkiv Ventures AB", "permanent_url": "https://legal.exploreworldai.com/novacopilot", "source": "Source: NovaCopilot", "powered_by": "Powered by NovaCopilot", "license": "https://legal.exploreworldai.com/licensvillkor" }, "sections": [ { "title": "FOR PUBLICATION", "paragraphs": [] }, { "title": "UNITED STATES COURT OF APPEALS", "paragraphs": [] }, { "title": "FOR THE NINTH CIRCUIT", "paragraphs": [] }, { "title": "SEAGATE TECHNOLOGY LLC;", "paragraphs": [] }, { "title": "SEAGATE TECHNOLOGY", "paragraphs": [] }, { "title": "(THAILAND) LTD.; SEAGATE", "paragraphs": [] }, { "title": "SINGAPORE INTERNATIONAL", "paragraphs": [] }, { "title": "HEADQUARTERS PTE, LTD;", "paragraphs": [] }, { "title": "SEAGATE TECHNOLOGY", "paragraphs": [ "para_10", "para_11", "para_12" ] }, { "title": "NHK SPRING CO., LTD.; NHK", "paragraphs": [] }, { "title": "INTERNATIONAL", "paragraphs": [] }, { "title": "CORPORATION; NHK SPRING", "paragraphs": [] }, { "title": "(THAILAND) CO., LTD.; NAT", "paragraphs": [ "para_17" ] }, { "title": "LTD.; NAT PERIPHERAL (H.K.)", "paragraphs": [ "para_19", "para_20" ] }, { "title": "No. 24-4470", "paragraphs": [ "para_22" ] }, { "title": "3:19-md-02918-", "paragraphs": [] }, { "title": "MMC", "paragraphs": [] }, { "title": "OPINION", "paragraphs": [] }, { "title": "Appeal from the United States District Court", "paragraphs": [ "para_27" ] }, { "title": "Maxine M. Chesney, District Judge, Presiding", "paragraphs": [ "para_29" ] }, { "title": "Argued and Submitted June 6, 2025", "paragraphs": [] }, { "title": "San Francisco, California", "paragraphs": [] }, { "title": "Filed January 8, 2026", "paragraphs": [] }, { "title": "Before: Consuelo M. Callahan and Kenneth K. Lee, Circuit", "paragraphs": [] }, { "title": "Judges, and Scott H. Rash, District Judge.*", "paragraphs": [] }, { "title": "Opinion by Judge Lee", "paragraphs": [] }, { "title": "SUMMARY**", "paragraphs": [] }, { "title": "Antitrust", "paragraphs": [] }, { "title": "The panel vacated the district court’s partial summary", "paragraphs": [ "para_39", "para_40", "para_41" ] }, { "title": "LLC, an American company, and two Seagate foreign", "paragraphs": [ "para_43" ] }, { "title": "The Seagate plaintiffs sought to bring antitrust claims", "paragraphs": [ "para_45", "para_46", "para_47", "para_48", "para_49", "para_50", "para_51", "para_52", "para_53" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 3", "paragraphs": [ "para_55", "para_56" ] }, { "title": "States. The district court ruled that the Sherman Act did not", "paragraphs": [ "para_58" ] }, { "title": "The panel held that Seagate alleged a viable theory of", "paragraphs": [ "para_60" ] }, { "title": "Improvements Act, which provides that U.S. antitrust laws", "paragraphs": [ "para_62", "para_63", "para_64", "para_65", "para_66", "para_67", "para_68", "para_69", "para_70", "para_71", "para_72", "para_73", "para_74", "para_75", "para_76", "para_77" ] }, { "title": "The panel remanded to the district court to determine", "paragraphs": [ "para_79", "para_80", "para_81" ] }, { "title": "COUNSEL", "paragraphs": [ "para_83" ] }, { "title": "New York; David R. Carpenter and Nicole M. Baade, Sidley", "paragraphs": [ "para_85" ] }, { "title": "Sidley Austin LLP, Washington, D.C.; Robert N. Hochman", "paragraphs": [ "para_87" ] }, { "title": "Illinois; Steffen N. Johnson and John B. Kenney, Wilson", "paragraphs": [ "para_89" ] }, { "title": "Evans-Aziz, Kenneth R. O'Rourke, and Jeff", "paragraphs": [] }, { "title": "VanHooreweghe, Wilson Sonsini Goodrich & Rosati, San", "paragraphs": [] }, { "title": "Francisco, California; Michael W. McConnell, Wilson", "paragraphs": [] }, { "title": "Sonsini Goodrich & Rosati, Palo Alto, California; for", "paragraphs": [ "para_94", "para_95", "para_96" ] }, { "title": "Washington, D.C.; Navi S. Dhillon, Paul Hastings LLP, San", "paragraphs": [ "para_98", "para_99", "para_100" ] }, { "title": "Minneapolis, Minnesota; Paul J. Riehle, Faegre Drinker", "paragraphs": [] }, { "title": "Biddle & Reath LLP, San Francisco, California; for Amicus", "paragraphs": [ "para_103" ] }, { "title": "Kathleen W. Bradish and Randy Stutz, American Antitrust", "paragraphs": [] }, { "title": "Institute, Washington, D.C., for Amicus Curiae American", "paragraphs": [ "para_106", "para_107" ] }, { "title": "Los Angeles, California, for Amicus Curiae Professor", "paragraphs": [ "para_109" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 5", "paragraphs": [] }, { "title": "OPINION", "paragraphs": [] }, { "title": "LEE, Circuit Judge:", "paragraphs": [] }, { "title": "American antitrust laws broadly prohibit anticompetitive", "paragraphs": [ "para_114" ] }, { "title": "Congress, however, largely closed our courthouse doors to", "paragraphs": [ "para_116" ] }, { "title": "But it carved out two narrow exceptions under the Foreign", "paragraphs": [ "para_118", "para_119", "para_120" ] }, { "title": "(1) involves goods imported into the United States that", "paragraphs": [] }, { "title": "Americans buy (the “import commerce” exclusion) or", "paragraphs": [] }, { "title": "(2) has a direct effect on domestic commerce that in turn", "paragraphs": [ "para_124", "para_125" ] }, { "title": "In an increasingly globalized economy, it can sometimes", "paragraphs": [ "para_127", "para_128", "para_129", "para_130", "para_131", "para_132" ] }, { "title": "Spring Co., Ltd. for unlawful price-fixing. In a separate", "paragraphs": [ "para_134", "para_135", "para_136", "para_137", "para_138", "para_139" ] }, { "title": "States. The district court thus granted partial summary", "paragraphs": [ "para_141", "para_142", "para_143" ] }, { "title": "We vacate the district court’s order because Seagate1 has", "paragraphs": [ "para_145" ] }, { "title": "FTAIA. According to Seagate’s complaint, NHK’s price-", "paragraphs": [ "para_147", "para_148" ] }, { "title": "Technology LLC. That agreement reflected an artificially", "paragraphs": [ "para_150" ] }, { "title": "Seagate Technology LLC agreement in turn allegedly set the", "paragraphs": [ "para_152", "para_153", "para_154", "para_155", "para_156", "para_157", "para_158", "para_159", "para_160", "para_161" ] }, { "title": "BACKGROUND", "paragraphs": [] }, { "title": "I. Factual Background", "paragraphs": [] }, { "title": "A. Seagate foreign entities buy SAs from NHK and", "paragraphs": [ "para_165" ] }, { "title": "Nearly every consumer electronic device needs a way to", "paragraphs": [ "para_167", "para_168", "para_169" ] }, { "title": "Seagate Thailand, and Seagate Singapore collectively. But we will refer", "paragraphs": [ "para_171", "para_172" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 7", "paragraphs": [ "para_174", "para_175", "para_176", "para_177", "para_178" ] }, { "title": "Technology LLC does not produce all the key components", "paragraphs": [ "para_180", "para_181", "para_182", "para_183", "para_184", "para_185", "para_186", "para_187" ] }, { "title": "Reflecting the global nature of commerce today, a", "paragraphs": [] }, { "title": "Seagate hard disk drive is built with parts bought and", "paragraphs": [ "para_190", "para_191", "para_192" ] }, { "title": "(Thailand) Ltd (“Seagate Thailand”). There, the suspension", "paragraphs": [ "para_194", "para_195", "para_196", "para_197", "para_198", "para_199", "para_200" ] }, { "title": "Headquarters Pte. Ltd. (“Seagate Singapore”) for", "paragraphs": [ "para_202", "para_203", "para_204", "para_205", "para_206", "para_207" ] }, { "title": "Seagate buys its suspension assemblies from a few", "paragraphs": [ "para_209", "para_210", "para_211" ] }, { "title": "Ltd., a leading Japanese manufacturer of springs and other", "paragraphs": [ "para_213", "para_214" ] }, { "title": "Seagate business” for suspension assembly projects, despite", "paragraphs": [ "para_216" ] }, { "title": "B. NHK rigs suspension assembly prices based on a", "paragraphs": [ "para_218" ] }, { "title": "In July 2019, NHK pleaded guilty to criminal price-", "paragraphs": [ "para_220", "para_221", "para_222", "para_223" ] }, { "title": "NHK’s officers and employees held meetings with another", "paragraphs": [ "para_225", "para_226", "para_227", "para_228", "para_229", "para_230", "para_231", "para_232" ] }, { "title": "States v. NHK Spring Co. Ltd., ECF 25 at 8, No. 2:19-cr-", "paragraphs": [ "para_234" ] }, { "title": "2 A few SAs are directly imported for testing and product development", "paragraphs": [ "para_236" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 9", "paragraphs": [] }, { "title": "NHK’s plea agreement explains that suspension", "paragraphs": [ "para_239", "para_240", "para_241", "para_242" ] }, { "title": "The “primary purpose” of this conspiracy was to “fix the", "paragraphs": [ "para_244" ] }, { "title": "United States and elsewhere.” These centralized “pricing", "paragraphs": [ "para_246", "para_247", "para_248", "para_249", "para_250", "para_251", "para_252", "para_253" ] }, { "title": "Management Team (“CMT”) in Minnesota. The foreign", "paragraphs": [ "para_255", "para_256", "para_257" ] }, { "title": "Pricing was negotiated by Seagate CMT with suppliers", "paragraphs": [ "para_259", "para_260", "para_261", "para_262", "para_263", "para_264", "para_265" ] }, { "title": "Quotation.” First, Seagate Technology LLC would send a", "paragraphs": [ "para_267", "para_268", "para_269", "para_270", "para_271", "para_272", "para_273", "para_274", "para_275", "para_276", "para_277" ] }, { "title": "These RFQ responses, called “anticipated pricing", "paragraphs": [ "para_279", "para_280", "para_281" ] }, { "title": "RFQ responses for a given Seagate product with his", "paragraphs": [ "para_283", "para_284", "para_285", "para_286", "para_287" ] }, { "title": "RFQ responses. Finally, to entrench this process, NHK’s", "paragraphs": [ "para_289", "para_290", "para_291", "para_292", "para_293", "para_294", "para_295", "para_296" ] }, { "title": "II. Procedural History", "paragraphs": [ "para_298" ] }, { "title": "Seagate sued in the Northern District of California, alleging", "paragraphs": [ "para_300", "para_301", "para_302", "para_303" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 11", "paragraphs": [] }, { "title": "Seagate amended its complaint twice, in October 2020 and", "paragraphs": [ "para_306" ] }, { "title": "While discovery was ongoing, NHK moved for Partial", "paragraphs": [] }, { "title": "Summary Judgment Regarding Foreign Commerce. NHK", "paragraphs": [ "para_309", "para_310", "para_311", "para_312", "para_313", "para_314", "para_315" ] }, { "title": "(1) involves imported goods that Americans buy or (2) “has", "paragraphs": [ "para_317" ] }, { "title": "U.S. domestic commerce or certain exports and “such effect", "paragraphs": [ "para_319", "para_320", "para_321", "para_322", "para_323" ] }, { "title": "The district court at first agreed with NHK in part. In its", "paragraphs": [] }, { "title": "May 15, 2023 order, the court found that most of the", "paragraphs": [ "para_326" ] }, { "title": "Seagate Singapore never entered the United States at any", "paragraphs": [ "para_328", "para_329" ] }, { "title": "Disk Drive Suspension Assemblies Antitrust Litig. (“In re", "paragraphs": [ "para_331" ] }, { "title": "Cal. May 15, 2023). But about one-third of Seagate’s", "paragraphs": [ "para_333", "para_334", "para_335" ] }, { "title": "FTAIA’s import exclusion only covers conduct involving", "paragraphs": [ "para_337", "para_338", "para_339", "para_340", "para_341", "para_342" ] }, { "title": "The district court changed direction when asked by NHK", "paragraphs": [ "para_344", "para_345" ] }, { "title": "States for the import exclusion to apply, and no suspension", "paragraphs": [ "para_347", "para_348", "para_349", "para_350", "para_351", "para_352", "para_353", "para_354", "para_355" ] }, { "title": "(quoting In re Dynamic Random Access Memory (DRAM)", "paragraphs": [] }, { "title": "Antitrust Litig., 546 F.3d 981, 988 (9th Cir. 2008) (“In re", "paragraphs": [] }, { "title": "DRAM”)). The district court thus granted NHK’s partial", "paragraphs": [ "para_359" ] }, { "title": "Finally, the court found Seagate’s Second Amended", "paragraphs": [] }, { "title": "Complaint did not include any “factual allegations that any", "paragraphs": [] }, { "title": "Seagate Plaintiff indirectly purchased an SA or a product", "paragraphs": [ "para_363", "para_364", "para_365", "para_366" ] }, { "title": "Seagate advances several positions on appeal: (1) that", "paragraphs": [ "para_368", "para_369" ] }, { "title": "Seagate’s antitrust injuries abroad, and (3) that at least a", "paragraphs": [] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 13", "paragraphs": [ "para_372" ] }, { "title": "See 15 U.S.C. § 6a. Seagate also argues that Seagate", "paragraphs": [] }, { "title": "Technology LLC—rather than Seagate Thailand or Seagate", "paragraphs": [] }, { "title": "Singapore—was the “direct purchaser” of all the suspension", "paragraphs": [ "para_376", "para_377", "para_378", "para_379" ] }, { "title": "DISCUSSION", "paragraphs": [ "para_381", "para_382" ] }, { "title": "986 F.3d 1253, 1259 (9th Cir. 2021) (citation omitted). We", "paragraphs": [ "para_384", "para_385", "para_386", "para_387" ] }, { "title": "States, 265 F.3d 1017, 1021 (9th Cir. 2001) (citation", "paragraphs": [ "para_389", "para_390", "para_391", "para_392", "para_393" ] }, { "title": "I. The FTAIA places geographic limits on the reach of", "paragraphs": [ "para_395" ] }, { "title": "Congress enacted the FTAIA in 1982 in part to clarify", "paragraphs": [] }, { "title": "United States antitrust jurisdiction over international", "paragraphs": [ "para_398" ] }, { "title": "Hartford Fire Ins. Co. v. California, 509 U.S. 764, 796 n.23", "paragraphs": [ "para_400", "para_401" ] }, { "title": "677–78 (9th Cir. 2004). The statute provides that the", "paragraphs": [] }, { "title": "Sherman Act:", "paragraphs": [ "para_404", "para_405", "para_406", "para_407", "para_408" ] }, { "title": "(A) on trade or commerce which is", "paragraphs": [ "para_410", "para_411", "para_412" ] }, { "title": "(B) on export trade or export", "paragraphs": [ "para_414", "para_415", "para_416" ] }, { "title": "(2) such effect gives rise to a claim under", "paragraphs": [ "para_418" ] }, { "title": "15 U.S.C. § 6a. In other words, the statute generally bars the", "paragraphs": [] }, { "title": "Sherman Act from reaching foreign commercial activity, but", "paragraphs": [ "para_421", "para_422", "para_423", "para_424" ] }, { "title": "(2) sufficiently affects American domestic or (certain)", "paragraphs": [ "para_426", "para_427", "para_428" ] }, { "title": "American exporters, not foreign consumers or producers,”", "paragraphs": [ "para_430", "para_431" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 15", "paragraphs": [] }, { "title": "The phrasing of the FTAIA has been called confusing at", "paragraphs": [ "para_434", "para_435", "para_436", "para_437", "para_438", "para_439", "para_440", "para_441" ] }, { "title": "161 (2004) (citing House Report). If a foreign country does", "paragraphs": [ "para_443", "para_444", "para_445", "para_446", "para_447" ] }, { "title": "Congress thus did not expand the purview of our antitrust", "paragraphs": [ "para_449", "para_450", "para_451", "para_452", "para_453", "para_454", "para_455" ] }, { "title": "States v. Hui Hsiung, 778 F.3d 738, 754 (9th Cir. 2015)", "paragraphs": [ "para_457" ] }, { "title": "Indeed, there is good reason to be circumspect when it", "paragraphs": [ "para_459", "para_460", "para_461", "para_462", "para_463", "para_464", "para_465", "para_466", "para_467", "para_468", "para_469" ] }, { "title": "Circuit noted, a company cannot “pick and choose from the", "paragraphs": [ "para_471", "para_472", "para_473", "para_474", "para_475" ] }, { "title": "F.3d 816, 822, 827 (7th Cir. 2015); see also Empagran, 542", "paragraphs": [ "para_477" ] }, { "title": "In short, American antitrust protections apply only when", "paragraphs": [ "para_479", "para_480", "para_481" ] }, { "title": "First, “import trade” and “import commerce” are", "paragraphs": [ "para_483" ] }, { "title": "(i.e., the Sherman Act applies). See 15 U.S.C. § 6a; Hui", "paragraphs": [] }, { "title": "Hsiung, 778 F.3d at 754. For example, if Japanese", "paragraphs": [ "para_486", "para_487", "para_488", "para_489" ] }, { "title": "Second, the Sherman Act also applies to anticompetitive", "paragraphs": [ "para_491", "para_492", "para_493", "para_494", "para_495" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 17", "paragraphs": [] }, { "title": "We next turn to whether Seagate meets either the “import", "paragraphs": [ "para_498", "para_499" ] }, { "title": "II. The FTAIA’s “import commerce” exclusion does", "paragraphs": [ "para_501", "para_502" ] }, { "title": "Seagate Thailand and Seagate Singapore bought price-", "paragraphs": [ "para_504", "para_505", "para_506", "para_507", "para_508", "para_509", "para_510", "para_511" ] }, { "title": "But NHK’s price-fixing conduct did not involve “import", "paragraphs": [ "para_513", "para_514" ] }, { "title": "Only the finished hard disk drives were imported into the", "paragraphs": [] }, { "title": "United States. Any trade or commerce involving suspension", "paragraphs": [ "para_517", "para_518", "para_519" ] }, { "title": "Seagate does not dispute that none of the suspension", "paragraphs": [ "para_521" ] }, { "title": "3 Seagate argues that the FTAIA is not relevant here because this case", "paragraphs": [ "para_523", "para_524" ] }, { "title": "Supreme Court held that the FTAIA applied in Empagran even though", "paragraphs": [ "para_526", "para_527", "para_528", "para_529", "para_530", "para_531", "para_532", "para_533", "para_534", "para_535" ] }, { "title": "Seagate mainly relies on two related arguments to argue", "paragraphs": [ "para_537", "para_538", "para_539" ] }, { "title": "FTAIA exempts not only import trade and commerce but", "paragraphs": [ "para_541", "para_542", "para_543", "para_544", "para_545", "para_546" ] }, { "title": "These arguments are unconvincing. For starters, we", "paragraphs": [ "para_548", "para_549" ] }, { "title": "READING LAW: THE INTERPRETATION OF LEGAL TEXTS 69", "paragraphs": [] }, { "title": "(2012). And we have never defined “import trade or", "paragraphs": [ "para_552", "para_553", "para_554", "para_555" ] }, { "title": "Korean company Samsung. Many of its phones use batteries", "paragraphs": [ "para_557" ] }, { "title": "Vietnam. We would normally describe Samsung phones as", "paragraphs": [ "para_559", "para_560" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 19", "paragraphs": [] }, { "title": "In Hui Hsiung, we strongly suggested that the “import", "paragraphs": [ "para_563", "para_564" ] }, { "title": "LCD liquid crystal display panels found in many computer", "paragraphs": [ "para_566", "para_567", "para_568" ] }, { "title": "F.3d at 753, we considered only panels that came directly to", "paragraphs": [ "para_570" ] }, { "title": "755. We repeatedly emphasized that the defendant", "paragraphs": [ "para_572" ] }, { "title": "States.” Id. And most of all, we explained that even though", "paragraphs": [ "para_574", "para_575", "para_576" ] }, { "title": "TFT–LCD panels at [fixed] prices . . . . [and] [i]mportation", "paragraphs": [ "para_578", "para_579" ] }, { "title": "(emphasis added). In other words, the display panels by", "paragraphs": [ "para_581", "para_582", "para_583", "para_584", "para_585" ] }, { "title": "755 (citations omitted). In contrast here, the suspension", "paragraphs": [ "para_587", "para_588", "para_589" ] }, { "title": "U.S. nexus to justify the extraterritorial reach of American", "paragraphs": [ "para_591" ] }, { "title": "True, Hui Hsiung dealt with the sufficiency of an", "paragraphs": [ "para_593", "para_594", "para_595" ] }, { "title": "56 & n.8. But nothing in the case suggests that it would", "paragraphs": [ "para_597" ] }, { "title": "Seagate suggests. It is also true that suspension assemblies", "paragraphs": [ "para_599" ] }, { "title": "Seagate notes. But Seagate fails to explain why this should", "paragraphs": [ "para_601", "para_602" ] }, { "title": "FTAIA’s import exclusion, seeing as relief may still be", "paragraphs": [ "para_604", "para_605" ] }, { "title": "In sum, Seagate was harmed not in the import trade but", "paragraphs": [ "para_607", "para_608", "para_609", "para_610", "para_611" ] }, { "title": "III. The FTAIA’s “domestic effects” exception might", "paragraphs": [ "para_613", "para_614" ] }, { "title": "The FTAIA has another exception—“domestic", "paragraphs": [ "para_616" ] }, { "title": "American antitrust law. Foreign non-import commerce can", "paragraphs": [ "para_618" ] }, { "title": "(1) has a “direct, substantial, and reasonably foreseeable", "paragraphs": [ "para_620", "para_621", "para_622" ] }, { "title": "American antitrust jurisdiction absent a direct, substantial", "paragraphs": [ "para_624", "para_625", "para_626" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 21", "paragraphs": [] }, { "title": "The two requirements above are strict by design. A", "paragraphs": [ "para_629", "para_630", "para_631" ] }, { "title": "778 F.3d at 758 & n.9. An “effect cannot be ‘direct’ where", "paragraphs": [ "para_633" ] }, { "title": "379 F.3d at 681. And to “give[] rise to” a Sherman Act claim", "paragraphs": [ "para_635", "para_636", "para_637", "para_638", "para_639" ] }, { "title": "Together, these requirements ensure there is a sufficient", "paragraphs": [ "para_641", "para_642", "para_643", "para_644", "para_645" ] }, { "title": "Sherman Act violation. Put differently, U.S. courts are only", "paragraphs": [ "para_647", "para_648", "para_649", "para_650" ] }, { "title": "We address the first prong of the domestic effects", "paragraphs": [ "para_652", "para_653" ] }, { "title": "(requiring an adverse effect). Seagate asserts that “NHK", "paragraphs": [ "para_655", "para_656", "para_657", "para_658", "para_659" ] }, { "title": "These facts are largely undisputed. NHK admits in its", "paragraphs": [ "para_661", "para_662", "para_663", "para_664", "para_665", "para_666", "para_667", "para_668", "para_669" ] }, { "title": "HDD suspension assemblies.” The parties in their briefing", "paragraphs": [ "para_671", "para_672", "para_673", "para_674" ] }, { "title": "Quantum, IBM, Fujitsu, Samsung, and Hitachi, during the", "paragraphs": [ "para_676", "para_677", "para_678", "para_679", "para_680", "para_681", "para_682" ] }, { "title": "NHK admits to fixing prices of suspension assemblies sold", "paragraphs": [ "para_684" ] }, { "title": "NHK’s actions apparently had a direct, substantial, and", "paragraphs": [ "para_686" ] }, { "title": "U.S.C. § 6a(1).4", "paragraphs": [] }, { "title": "4 NHK’s argument that a corrupt U.S. bidding process can only", "paragraphs": [ "para_689", "para_690", "para_691" ] }, { "title": "While the actual “stuff” of NHK’s conspiracy (illicit meetings, illegal", "paragraphs": [] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 23", "paragraphs": [] }, { "title": "To be sure, the domestic effect from NHK’s", "paragraphs": [ "para_695" ] }, { "title": "Technology LLC because it did not buy the suspension", "paragraphs": [ "para_697", "para_698", "para_699", "para_700", "para_701" ] }, { "title": "NHK’s price-fixing apparently had a significant and direct", "paragraphs": [ "para_703", "para_704", "para_705" ] }, { "title": "The FTAIA’s statutory language does not require more", "paragraphs": [ "para_707", "para_708", "para_709", "para_710", "para_711", "para_712" ] }, { "title": "Act “claim” by the plaintiff), the first prong makes no", "paragraphs": [ "para_714", "para_715", "para_716", "para_717", "para_718" ] }, { "title": "United States, the FTAIA may not even apply. We", "paragraphs": [ "para_720", "para_721", "para_722", "para_723" ] }, { "title": "Empagran, 542 U.S. at 175 (calling “higher prices in the United States”", "paragraphs": [ "para_725", "para_726", "para_727", "para_728", "para_729", "para_730", "para_731", "para_732", "para_733", "para_734", "para_735", "para_736", "para_737" ] }, { "title": "417 F.3d 1267, 1269 (D.C. Cir. 2005) (plaintiffs “need only", "paragraphs": [ "para_739", "para_740", "para_741", "para_742", "para_743" ] }, { "title": "Similarly here, Seagate need not show that it was injured", "paragraphs": [ "para_745", "para_746", "para_747", "para_748", "para_749", "para_750" ] }, { "title": "Under the second prong, Seagate must show that this", "paragraphs": [ "para_752", "para_753" ] }, { "title": "B. The tainted RFQ prices potentially gave rise to", "paragraphs": [ "para_755" ] }, { "title": "To meet the second prong of the domestic effects", "paragraphs": [ "para_757", "para_758" ] }, { "title": "Thailand’s and Seagate Singapore’s respective overcharge", "paragraphs": [] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 25", "paragraphs": [ "para_761", "para_762", "para_763", "para_764" ] }, { "title": "Most foreign injury claims fail at this step because it is", "paragraphs": [ "para_766", "para_767", "para_768" ] }, { "title": "Seagate’s claim, however, appears to be viable because of", "paragraphs": [ "para_770" ] }, { "title": "Agreement and the quarterly RFQs—all negotiated in the", "paragraphs": [ "para_772", "para_773", "para_774" ] }, { "title": "Seagate has provided evidence that its foreign subsidiaries", "paragraphs": [ "para_776", "para_777" ] }, { "title": "Seagate Technology LLC and entered orders at the (inflated)", "paragraphs": [ "para_779" ] }, { "title": "At oral argument, NHK admitted that suspension assembly", "paragraphs": [ "para_781", "para_782", "para_783", "para_784", "para_785", "para_786", "para_787" ] }, { "title": "The district court credited this evidence in its May 15", "paragraphs": [ "para_789", "para_790", "para_791" ] }, { "title": "The court in its November 17 order also acknowledged", "paragraphs": [] }, { "title": "Seagate’s theory that “the prices for SAs to be charged to", "paragraphs": [ "para_794" ] }, { "title": "Seagate entities located outside the United States were set”", "paragraphs": [ "para_796", "para_797", "para_798", "para_799", "para_800", "para_801", "para_802", "para_803" ] }, { "title": "We believe the district court erred in reading In re DRAM", "paragraphs": [ "para_805", "para_806", "para_807", "para_808", "para_809", "para_810", "para_811" ] }, { "title": "546 F.3d at 984. Relying on a chain of inferences about", "paragraphs": [ "para_813", "para_814", "para_815", "para_816", "para_817", "para_818", "para_819" ] }, { "title": "Seagate’s theory, in contrast, is rooted in the certainty of", "paragraphs": [ "para_821", "para_822", "para_823", "para_824" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 27", "paragraphs": [] }, { "title": "U.S. at 175. 5 Rather, Seagate explains exactly how", "paragraphs": [ "para_827", "para_828", "para_829", "para_830", "para_831", "para_832", "para_833" ] }, { "title": "We acknowledge, however, that factual questions exist", "paragraphs": [ "para_835", "para_836" ] }, { "title": "Seagate Singapore controlled just as Seagate Thailand was", "paragraphs": [ "para_838", "para_839", "para_840", "para_841", "para_842", "para_843" ] }, { "title": "C. Foreign antitrust injury is only eligible for relief when", "paragraphs": [ "para_845" ] }, { "title": "We conclude with a few remarks on why this case is", "paragraphs": [ "para_847", "para_848", "para_849" ] }, { "title": "5 In Empagran, the Court held that the “domestic effect” exception did", "paragraphs": [ "para_851", "para_852", "para_853" ] }, { "title": "(emphasis added). The Court used the word “independent” 35 times in", "paragraphs": [ "para_855", "para_856", "para_857", "para_858", "para_859", "para_860", "para_861" ] }, { "title": "Circuit’s decision in Motorola, 775 F.3d 816, offers valid", "paragraphs": [ "para_863", "para_864", "para_865" ] }, { "title": "778 F.3d at 760, it flagged the practical problems of", "paragraphs": [ "para_867", "para_868", "para_869", "para_870", "para_871" ] }, { "title": "775 F.3d at 820. “Companies operate", "paragraphs": [ "para_873", "para_874", "para_875", "para_876", "para_877", "para_878", "para_879", "para_880", "para_881" ] }, { "title": "The court thus held that Motorola’s parent entity—Motorola", "paragraphs": [] }, { "title": "Mobility LLC—could not sue on its subsidiaries’ behalf for", "paragraphs": [ "para_884" ] }, { "title": "(declining “to give Motorola rights to take the place of its", "paragraphs": [ "para_886", "para_887" ] }, { "title": "These appear valid points, but the facts and context of", "paragraphs": [ "para_889" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 29", "paragraphs": [ "para_891" ] }, { "title": "Empagran, considerations of judicial policy, and the", "paragraphs": [ "para_893" ] }, { "title": "First off, the Seventh Circuit in Motorola did not", "paragraphs": [ "para_895", "para_896", "para_897", "para_898" ] }, { "title": "As a policy matter, the Seventh Circuit advocated a bright-", "paragraphs": [ "para_900" ] }, { "title": "Act claims based on foreign injuries because the harmed", "paragraphs": [ "para_902", "para_903" ] }, { "title": "(correctly) agree that the FTAIA does not bar foreign", "paragraphs": [ "para_905", "para_906" ] }, { "title": "Supreme Court has noted, “Congress [did not] place the", "paragraphs": [ "para_908", "para_909", "para_910", "para_911", "para_912", "para_913", "para_914", "para_915" ] }, { "title": "Thailand and Seagate Singapore because they adopted those", "paragraphs": [ "para_917" ] }, { "title": "Second, we are not confronted with a typical foreign", "paragraphs": [ "para_919", "para_920", "para_921", "para_922", "para_923", "para_924", "para_925", "para_926", "para_927" ] }, { "title": "States because fixing U.S. commercial activity meant", "paragraphs": [ "para_929" ] }, { "title": "According to Empagran, the Sherman Act very much was", "paragraphs": [ "para_931", "para_932", "para_933", "para_934", "para_935" ] }, { "title": "166. Simply put, Americans too were harmed by NHK’s", "paragraphs": [ "para_937", "para_938", "para_939", "para_940", "para_941", "para_942", "para_943" ] }, { "title": "And because the FTAIA imposes very stringent “direct", "paragraphs": [ "para_945", "para_946", "para_947", "para_948" ] }, { "title": "Report). Tenuous or speculative injuries will not pass this", "paragraphs": [ "para_950", "para_951", "para_952", "para_953" ] }, { "title": "6 To be fair, Americans will not directly reap the benefits of any damages", "paragraphs": [ "para_955", "para_956" ] }, { "title": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 31", "paragraphs": [ "para_958", "para_959", "para_960" ] }, { "title": "Finally, the international comity concerns raised in", "paragraphs": [] }, { "title": "Motorola are addressed (or perhaps outweighed) by the", "paragraphs": [ "para_963", "para_964" ] }, { "title": "Empagran, we “have long held that application of our", "paragraphs": [ "para_966", "para_967", "para_968" ] }, { "title": "542 U.S. at 165. International comity may have to be cast", "paragraphs": [ "para_970", "para_971", "para_972", "para_973", "para_974", "para_975" ] }, { "title": "Finally, we affirm the district court’s determination that", "paragraphs": [] }, { "title": "Seagate Thailand was not a mere purchasing agent for", "paragraphs": [] }, { "title": "Seagate Technology LLC because it did not purchase the", "paragraphs": [ "para_979", "para_980" ] }, { "title": "Seagate’s Second Amended Complaint “includes no factual", "paragraphs": [ "para_982", "para_983" ] }, { "title": "While indirect purchases are not the focus of the Second", "paragraphs": [] }, { "title": "Amended Complaint, it repeatedly alleges that Seagate", "paragraphs": [] }, { "title": "Technology LLC bought suspension assemblies; these", "paragraphs": [ "para_987" ] }, { "title": "Sherman Act claim alleges that NHK “[sold] suspension", "paragraphs": [ "para_989", "para_990", "para_991", "para_992", "para_993" ] }, { "title": "Because an allegation under FED. R. CIV. PROC. 8 does", "paragraphs": [ "para_995", "para_996", "para_997" ] }, { "title": "Seagate Thailand and Seagate Singapore gives it standing to", "paragraphs": [ "para_999", "para_1000", "para_1001" ] }, { "title": "Johnson, 523 F.3d 1116, 1123 n.1 (9th Cir. 2008)", "paragraphs": [] }, { "title": "(recognizing “standing for an indirect purchaser if . . . the", "paragraphs": [ "para_1004", "para_1005" ] }, { "title": "F.3d 741, 749 (9th Cir. 2012) (“[I]ndirect purchasers may", "paragraphs": [ "para_1007", "para_1008", "para_1009" ] }, { "title": "Technology LLC has a viable indirect purchaser claim under", "paragraphs": [ "para_1011" ] }, { "title": "CONCLUSION", "paragraphs": [] }, { "title": "We vacate the district court’s May 15, 2023 and", "paragraphs": [] }, { "title": "November 17, 2023 orders granting partial summary", "paragraphs": [ "para_1015", "para_1016", "para_1017" ] } ], "paragraphs": [ { "text": "FOR PUBLICATION", "paragraph_id": "para_1" }, { "text": "UNITED STATES COURT OF APPEALS", "paragraph_id": "para_2" }, { "text": "FOR THE NINTH CIRCUIT", "paragraph_id": "para_3" }, { "text": "SEAGATE TECHNOLOGY LLC;", "paragraph_id": "para_4" }, { "text": "SEAGATE TECHNOLOGY", "paragraph_id": "para_5" }, { "text": "(THAILAND) LTD.; SEAGATE", "paragraph_id": "para_6" }, { "text": "SINGAPORE INTERNATIONAL", "paragraph_id": "para_7" }, { "text": "HEADQUARTERS PTE, LTD;", "paragraph_id": "para_8" }, { "text": "SEAGATE TECHNOLOGY", "paragraph_id": "para_9" }, { "text": "INTERNATIONAL,", "paragraph_id": "para_10" }, { "text": "Plaintiffs - Appellants,", "paragraph_id": "para_11" }, { "text": "v.", "paragraph_id": "para_12" }, { "text": "NHK SPRING CO., LTD.; NHK", "paragraph_id": "para_13" }, { "text": "INTERNATIONAL", "paragraph_id": "para_14" }, { "text": "CORPORATION; NHK SPRING", "paragraph_id": "para_15" }, { "text": "(THAILAND) CO., LTD.; NAT", "paragraph_id": "para_16" }, { "text": "PERIPHERAL (DONG GUAN) CO.,", "paragraph_id": "para_17" }, { "text": "LTD.; NAT PERIPHERAL (H.K.)", "paragraph_id": "para_18" }, { "text": "CO., LTD.,", "paragraph_id": "para_19" }, { "text": "Defendants - Appellees.", "paragraph_id": "para_20" }, { "text": "No. 24-4470", "paragraph_id": "para_21" }, { "text": "D.C. No.", "paragraph_id": "para_22" }, { "text": "3:19-md-02918-", "paragraph_id": "para_23" }, { "text": "MMC", "paragraph_id": "para_24" }, { "text": "OPINION", "paragraph_id": "para_25" }, { "text": "Appeal from the United States District Court", "paragraph_id": "para_26" }, { "text": "for the Northern District of California", "paragraph_id": "para_27" }, { "text": "Maxine M. Chesney, District Judge, Presiding", "paragraph_id": "para_28" }, { "text": "2 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_29" }, { "text": "Argued and Submitted June 6, 2025", "paragraph_id": "para_30" }, { "text": "San Francisco, California", "paragraph_id": "para_31" }, { "text": "Filed January 8, 2026", "paragraph_id": "para_32" }, { "text": "Before: Consuelo M. Callahan and Kenneth K. Lee, Circuit", "paragraph_id": "para_33" }, { "text": "Judges, and Scott H. Rash, District Judge.*", "paragraph_id": "para_34" }, { "text": "Opinion by Judge Lee", "paragraph_id": "para_35" }, { "text": "SUMMARY**", "paragraph_id": "para_36" }, { "text": "Antitrust", "paragraph_id": "para_37" }, { "text": "The panel vacated the district court’s partial summary", "paragraph_id": "para_38" }, { "text": "judgment in favor of defendants NHK Spring Co., Ltd., et al.", "paragraph_id": "para_39" }, { "text": "and remanded for further proceedings in an antitrust action", "paragraph_id": "para_40" }, { "text": "brought under the Sherman Act by Seagate Technology", "paragraph_id": "para_41" }, { "text": "LLC, an American company, and two Seagate foreign", "paragraph_id": "para_42" }, { "text": "entities.", "paragraph_id": "para_43" }, { "text": "The Seagate plaintiffs sought to bring antitrust claims", "paragraph_id": "para_44" }, { "text": "against Japanese-owned NHK for unlawful price-fixing. In", "paragraph_id": "para_45" }, { "text": "a separate federal criminal proceeding, NHK pleaded guilty", "paragraph_id": "para_46" }, { "text": "to conspiring with its competitors to fix the price of", "paragraph_id": "para_47" }, { "text": "suspension assemblies sold in the United States and", "paragraph_id": "para_48" }, { "text": "elsewhere in the world. Seagate’s foreign entities bought", "paragraph_id": "para_49" }, { "text": "* The Honorable Scott H. Rash, United States District Judge for the", "paragraph_id": "para_50" }, { "text": "District of Arizona, sitting by designation.", "paragraph_id": "para_51" }, { "text": "** This summary constitutes no part of the opinion of the court. It has", "paragraph_id": "para_52" }, { "text": "been prepared by court staff for the convenience of the reader.", "paragraph_id": "para_53" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 3", "paragraph_id": "para_54" }, { "text": "those price-fixed suspension assemblies, which were", "paragraph_id": "para_55" }, { "text": "incorporated into Seagate’s hard drives, outside the United", "paragraph_id": "para_56" }, { "text": "States. The district court ruled that the Sherman Act did not", "paragraph_id": "para_57" }, { "text": "extend to such foreign injury.", "paragraph_id": "para_58" }, { "text": "The panel held that Seagate alleged a viable theory of", "paragraph_id": "para_59" }, { "text": "extraterritorial reach under the Foreign Trade Antitrust", "paragraph_id": "para_60" }, { "text": "Improvements Act, which provides that U.S. antitrust laws", "paragraph_id": "para_61" }, { "text": "can apply, even if an injury occurs beyond U.S. borders, if", "paragraph_id": "para_62" }, { "text": "the anticompetitive conduct (1) involves goods imported", "paragraph_id": "para_63" }, { "text": "into the United States that Americans buy (the “import", "paragraph_id": "para_64" }, { "text": "commerce” exclusion) or (2) has a direct effect on domestic", "paragraph_id": "para_65" }, { "text": "commerce that in turn causes the foreign antitrust injury to", "paragraph_id": "para_66" }, { "text": "the plaintiff (the “domestic effects” exception). The panel", "paragraph_id": "para_67" }, { "text": "held that the import commerce exclusion did not apply", "paragraph_id": "para_68" }, { "text": "because the suspension assemblies were not directly", "paragraph_id": "para_69" }, { "text": "imported into the U.S. But under the domestic effects", "paragraph_id": "para_70" }, { "text": "exception, Seagate sufficiently alleged that NHK’s price-", "paragraph_id": "para_71" }, { "text": "fixing in the U.S., as reflected in a master product supply", "paragraph_id": "para_72" }, { "text": "agreement negotiated in the U.S., led to the domestic harm", "paragraph_id": "para_73" }, { "text": "of higher prices for the suspension assemblies in the U.S.,", "paragraph_id": "para_74" }, { "text": "and that effect also directly caused an antitrust injury abroad", "paragraph_id": "para_75" }, { "text": "because Seagate’s foreign entities overpaid for the", "paragraph_id": "para_76" }, { "text": "suspension assemblies based on the inflated U.S. price.", "paragraph_id": "para_77" }, { "text": "The panel remanded to the district court to determine", "paragraph_id": "para_78" }, { "text": "whether Seagate adduced sufficient evidence of proximate", "paragraph_id": "para_79" }, { "text": "cause to survive summary judgment.", "paragraph_id": "para_80" }, { "text": "4 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_81" }, { "text": "COUNSEL", "paragraph_id": "para_82" }, { "text": "Eamon P. Joyce (argued), Sidley Austin LLP, New York,", "paragraph_id": "para_83" }, { "text": "New York; David R. Carpenter and Nicole M. Baade, Sidley", "paragraph_id": "para_84" }, { "text": "Austin LLP, Los Angeles, California; Jeremy Rozansky,", "paragraph_id": "para_85" }, { "text": "Sidley Austin LLP, Washington, D.C.; Robert N. Hochman", "paragraph_id": "para_86" }, { "text": "and Shirin Mahkamova, Sidley Austin LLP, Chicago,", "paragraph_id": "para_87" }, { "text": "Illinois; Steffen N. Johnson and John B. Kenney, Wilson", "paragraph_id": "para_88" }, { "text": "Sonsini Goodrich & Rosati, Washington, D.C.; Mikaela E.", "paragraph_id": "para_89" }, { "text": "Evans-Aziz, Kenneth R. O'Rourke, and Jeff", "paragraph_id": "para_90" }, { "text": "VanHooreweghe, Wilson Sonsini Goodrich & Rosati, San", "paragraph_id": "para_91" }, { "text": "Francisco, California; Michael W. McConnell, Wilson", "paragraph_id": "para_92" }, { "text": "Sonsini Goodrich & Rosati, Palo Alto, California; for", "paragraph_id": "para_93" }, { "text": "Plaintiffs-Appellants.", "paragraph_id": "para_94" }, { "text": "Michael F. Murray (argued), Craig Y. Lee, Carter C.", "paragraph_id": "para_95" }, { "text": "Simpson, and Alexandra Glazer, Paul Hastings LLP,", "paragraph_id": "para_96" }, { "text": "Washington, D.C.; Navi S. Dhillon, Paul Hastings LLP, San", "paragraph_id": "para_97" }, { "text": "Francisco, California; for Defendants-Appellees.", "paragraph_id": "para_98" }, { "text": "Aaron D. Van Oort, Kevin P. Wagner, and Kirsten L.", "paragraph_id": "para_99" }, { "text": "Elfstrand, Faegre Drinker Biddle & Reath LLP,", "paragraph_id": "para_100" }, { "text": "Minneapolis, Minnesota; Paul J. Riehle, Faegre Drinker", "paragraph_id": "para_101" }, { "text": "Biddle & Reath LLP, San Francisco, California; for Amicus", "paragraph_id": "para_102" }, { "text": "Curiae Professor Kenneth G. Elzinga.", "paragraph_id": "para_103" }, { "text": "Kathleen W. Bradish and Randy Stutz, American Antitrust", "paragraph_id": "para_104" }, { "text": "Institute, Washington, D.C., for Amicus Curiae American", "paragraph_id": "para_105" }, { "text": "Antitrust Institute.", "paragraph_id": "para_106" }, { "text": "Jennifer L. Williams and Megan A. Maitia, Summa LLP,", "paragraph_id": "para_107" }, { "text": "Los Angeles, California, for Amicus Curiae Professor", "paragraph_id": "para_108" }, { "text": "Cedric Ryngaert.", "paragraph_id": "para_109" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 5", "paragraph_id": "para_110" }, { "text": "OPINION", "paragraph_id": "para_111" }, { "text": "LEE, Circuit Judge:", "paragraph_id": "para_112" }, { "text": "American antitrust laws broadly prohibit anticompetitive", "paragraph_id": "para_113" }, { "text": "conduct and authorize private parties to seek treble damages.", "paragraph_id": "para_114" }, { "text": "Congress, however, largely closed our courthouse doors to", "paragraph_id": "para_115" }, { "text": "antitrust claims based on injuries outside the United States.", "paragraph_id": "para_116" }, { "text": "But it carved out two narrow exceptions under the Foreign", "paragraph_id": "para_117" }, { "text": "Trade Antitrust Improvements Act (FTAIA). 15 U.S.C.", "paragraph_id": "para_118" }, { "text": "§ 6a. U.S. antitrust laws can still apply—even if the injury", "paragraph_id": "para_119" }, { "text": "occurs beyond our borders—if the anticompetitive conduct", "paragraph_id": "para_120" }, { "text": "(1) involves goods imported into the United States that", "paragraph_id": "para_121" }, { "text": "Americans buy (the “import commerce” exclusion) or", "paragraph_id": "para_122" }, { "text": "(2) has a direct effect on domestic commerce that in turn", "paragraph_id": "para_123" }, { "text": "causes the foreign antitrust injury to the plaintiff (the", "paragraph_id": "para_124" }, { "text": "“domestic effects” exception).", "paragraph_id": "para_125" }, { "text": "In an increasingly globalized economy, it can sometimes", "paragraph_id": "para_126" }, { "text": "be thorny, as in this case, to tease out when these narrow", "paragraph_id": "para_127" }, { "text": "statutory provisions allow extraterritorial reach of our", "paragraph_id": "para_128" }, { "text": "antitrust laws. Seagate Technology LLC (an American", "paragraph_id": "para_129" }, { "text": "company based in California) and two Seagate foreign", "paragraph_id": "para_130" }, { "text": "entities (Seagate Thailand and Seagate Singapore) argue that", "paragraph_id": "para_131" }, { "text": "they can bring antitrust claims against Japanese-owned NHK", "paragraph_id": "para_132" }, { "text": "Spring Co., Ltd. for unlawful price-fixing. In a separate", "paragraph_id": "para_133" }, { "text": "federal criminal proceeding, NHK pleaded guilty to", "paragraph_id": "para_134" }, { "text": "conspiring with its competitors to fix the price of", "paragraph_id": "para_135" }, { "text": "“suspension assemblies” sold in the United States and", "paragraph_id": "para_136" }, { "text": "elsewhere in the world. But Seagate’s foreign entities", "paragraph_id": "para_137" }, { "text": "bought those price-fixed suspension assemblies—which are", "paragraph_id": "para_138" }, { "text": "incorporated into Seagate’s hard drives—outside the United", "paragraph_id": "para_139" }, { "text": "States. The district court thus granted partial summary", "paragraph_id": "para_140" }, { "text": "6 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_141" }, { "text": "judgment for NHK, ruling that the Sherman Act did not", "paragraph_id": "para_142" }, { "text": "extend to such foreign injury.", "paragraph_id": "para_143" }, { "text": "We vacate the district court’s order because Seagate1 has", "paragraph_id": "para_144" }, { "text": "alleged a viable theory of extraterritorial reach under the", "paragraph_id": "para_145" }, { "text": "FTAIA. According to Seagate’s complaint, NHK’s price-", "paragraph_id": "para_146" }, { "text": "fixing scheme was reflected in a master product supply", "paragraph_id": "para_147" }, { "text": "agreement negotiated in the United States with Seagate", "paragraph_id": "para_148" }, { "text": "Technology LLC. That agreement reflected an artificially", "paragraph_id": "para_149" }, { "text": "high price for suspension assemblies. Then this NHK-", "paragraph_id": "para_150" }, { "text": "Seagate Technology LLC agreement in turn allegedly set the", "paragraph_id": "para_151" }, { "text": "pricing parameters for Seagate’s foreign entities because", "paragraph_id": "para_152" }, { "text": "they were obligated to accept those (fixed) prices in the", "paragraph_id": "para_153" }, { "text": "agreement. Put another way, NHK’s price-fixing in the U.S.", "paragraph_id": "para_154" }, { "text": "led to domestic harm (i.e., higher prices for the suspension", "paragraph_id": "para_155" }, { "text": "assemblies in the United States), and that effect also directly", "paragraph_id": "para_156" }, { "text": "caused an antitrust injury abroad (because Seagate’s foreign", "paragraph_id": "para_157" }, { "text": "entities overpaid for the suspension assemblies based on the", "paragraph_id": "para_158" }, { "text": "inflated U.S. price). We, however, remand for the district", "paragraph_id": "para_159" }, { "text": "court to determine whether Seagate has adduced sufficient", "paragraph_id": "para_160" }, { "text": "evidence of proximate cause to survive summary judgment.", "paragraph_id": "para_161" }, { "text": "BACKGROUND", "paragraph_id": "para_162" }, { "text": "I. Factual Background", "paragraph_id": "para_163" }, { "text": "A. Seagate foreign entities buy SAs from NHK and", "paragraph_id": "para_164" }, { "text": "other suppliers.", "paragraph_id": "para_165" }, { "text": "Nearly every consumer electronic device needs a way to", "paragraph_id": "para_166" }, { "text": "store data. Many devices—such as computers, gaming", "paragraph_id": "para_167" }, { "text": "consoles, and servers—rely on hard disk drives (HDDs) for", "paragraph_id": "para_168" }, { "text": "1 We will use the term “Seagate” to refer to Seagate Technology LLC,", "paragraph_id": "para_169" }, { "text": "Seagate Thailand, and Seagate Singapore collectively. But we will refer", "paragraph_id": "para_170" }, { "text": "to each Seagate entity by its individual name if that distinction is relevant", "paragraph_id": "para_171" }, { "text": "to our discussion.", "paragraph_id": "para_172" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 7", "paragraph_id": "para_173" }, { "text": "bulk storage. Hard disk drives resemble electro-magnetic", "paragraph_id": "para_174" }, { "text": "“filing cabinets” containing several drawers (or “platters”)", "paragraph_id": "para_175" }, { "text": "with millions of folders (or “sectors”) storing electronic data.", "paragraph_id": "para_176" }, { "text": "Seagate Technology LLC, a California-based company,", "paragraph_id": "para_177" }, { "text": "is a leading manufacturer of hard disk drives. But Seagate", "paragraph_id": "para_178" }, { "text": "Technology LLC does not produce all the key components", "paragraph_id": "para_179" }, { "text": "that go into a hard disk drive, including a part called the", "paragraph_id": "para_180" }, { "text": "“suspension assembly” (sometimes called “SA”). Each", "paragraph_id": "para_181" }, { "text": "platter in a hard drive constantly spins to allow the user to", "paragraph_id": "para_182" }, { "text": "access all the data sectors on that platter. A suspension", "paragraph_id": "para_183" }, { "text": "assembly holds a recording head 12 nanometers above a", "paragraph_id": "para_184" }, { "text": "platter turning at 150–170 miles per hour, requiring", "paragraph_id": "para_185" }, { "text": "precision like “a 747 aircraft flying full speed l/l6th of an", "paragraph_id": "para_186" }, { "text": "inch above a [jagged] desert surface.”", "paragraph_id": "para_187" }, { "text": "Reflecting the global nature of commerce today, a", "paragraph_id": "para_188" }, { "text": "Seagate hard disk drive is built with parts bought and", "paragraph_id": "para_189" }, { "text": "assembled across the world by various Seagate foreign", "paragraph_id": "para_190" }, { "text": "entities. Most of Seagate’s suspension assemblies are", "paragraph_id": "para_191" }, { "text": "bought in Thailand by the Thai entity, Seagate Technology", "paragraph_id": "para_192" }, { "text": "(Thailand) Ltd (“Seagate Thailand”). There, the suspension", "paragraph_id": "para_193" }, { "text": "assemblies are incorporated into another part called a head", "paragraph_id": "para_194" }, { "text": "gimbal assembly. Next, Seagate incorporates the head", "paragraph_id": "para_195" }, { "text": "gimbal assembly into yet another part called a head stack", "paragraph_id": "para_196" }, { "text": "assembly either in Thailand or China. The head stack", "paragraph_id": "para_197" }, { "text": "assemblies are then incorporated into finished hard disk", "paragraph_id": "para_198" }, { "text": "drives in Thailand, China, or Singapore, and all the hard disk", "paragraph_id": "para_199" }, { "text": "drives are shipped to Seagate Singapore International", "paragraph_id": "para_200" }, { "text": "Headquarters Pte. Ltd. (“Seagate Singapore”) for", "paragraph_id": "para_201" }, { "text": "distribution. Seagate Singapore either sells the hard disk", "paragraph_id": "para_202" }, { "text": "drives directly or distributes them to other Seagate entities to", "paragraph_id": "para_203" }, { "text": "sell, such as Seagate Technology LLC in California. In other", "paragraph_id": "para_204" }, { "text": "8 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_205" }, { "text": "words, only the finished hard disk drives are directly", "paragraph_id": "para_206" }, { "text": "imported into the United States.2", "paragraph_id": "para_207" }, { "text": "Seagate buys its suspension assemblies from a few", "paragraph_id": "para_208" }, { "text": "suppliers. Since the 1980s, the suspension assembly", "paragraph_id": "para_209" }, { "text": "manufacturing industry has consolidated greatly and only", "paragraph_id": "para_210" }, { "text": "two main players remain. One of those is NHK Spring Co.,", "paragraph_id": "para_211" }, { "text": "Ltd., a leading Japanese manufacturer of springs and other", "paragraph_id": "para_212" }, { "text": "engineered components like suspension assemblies. During", "paragraph_id": "para_213" }, { "text": "the relevant period, NHK often received “the majority of the", "paragraph_id": "para_214" }, { "text": "Seagate business” for suspension assembly projects, despite", "paragraph_id": "para_215" }, { "text": "being the highest-priced bidder on Seagate’s proposals.", "paragraph_id": "para_216" }, { "text": "B. NHK rigs suspension assembly prices based on a", "paragraph_id": "para_217" }, { "text": "U.S. agreement.", "paragraph_id": "para_218" }, { "text": "In July 2019, NHK pleaded guilty to criminal price-", "paragraph_id": "para_219" }, { "text": "fixing under the Sherman Antitrust Act, 15 U.S.C. § 1. From", "paragraph_id": "para_220" }, { "text": "before June 2008 to at least April 2016, NHK engaged in a", "paragraph_id": "para_221" }, { "text": "global conspiracy with another competitor to fix the price of", "paragraph_id": "para_222" }, { "text": "suspension assemblies in the United States and elsewhere.", "paragraph_id": "para_223" }, { "text": "NHK’s officers and employees held meetings with another", "paragraph_id": "para_224" }, { "text": "competitor in which they agreed “to refrain from competing", "paragraph_id": "para_225" }, { "text": "on prices for, fix the prices of, and allocate their respective", "paragraph_id": "para_226" }, { "text": "market shares for[] HDD suspension assemblies.” As part", "paragraph_id": "para_227" }, { "text": "of NHK’s plea agreement, the U.S. Department of Justice", "paragraph_id": "para_228" }, { "text": "sought a criminal fine of $28.5 million dollars, which was", "paragraph_id": "para_229" }, { "text": "approved by the U.S. District Court for the Eastern District", "paragraph_id": "para_230" }, { "text": "of Michigan. But the government did not seek restitution “in", "paragraph_id": "para_231" }, { "text": "light of the availability of civil causes of action.” See United", "paragraph_id": "para_232" }, { "text": "States v. NHK Spring Co. Ltd., ECF 25 at 8, No. 2:19-cr-", "paragraph_id": "para_233" }, { "text": "20503 (E.D. Mich. Jan. 31, 2020).", "paragraph_id": "para_234" }, { "text": "2 A few SAs are directly imported for testing and product development", "paragraph_id": "para_235" }, { "text": "purposes; these parts are not at issue in this appeal.", "paragraph_id": "para_236" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 9", "paragraph_id": "para_237" }, { "text": "NHK’s plea agreement explains that suspension", "paragraph_id": "para_238" }, { "text": "assembly suppliers “exchanged . . . pricing information,", "paragraph_id": "para_239" }, { "text": "including anticipated pricing quotes,” “and used the", "paragraph_id": "para_240" }, { "text": "exchanged pricing information to inform their negotiations", "paragraph_id": "para_241" }, { "text": "with U.S. and foreign customers that purchased” those parts.", "paragraph_id": "para_242" }, { "text": "The “primary purpose” of this conspiracy was to “fix the", "paragraph_id": "para_243" }, { "text": "prices of [hard disk drive] suspension assemblies sold in the", "paragraph_id": "para_244" }, { "text": "United States and elsewhere.” These centralized “pricing", "paragraph_id": "para_245" }, { "text": "quotes” apparently were at the heart of how Seagate sourced", "paragraph_id": "para_246" }, { "text": "suspension assemblies: Importantly for our case, although", "paragraph_id": "para_247" }, { "text": "nearly all of Seagate’s suspension assemblies were", "paragraph_id": "para_248" }, { "text": "purchased by its foreign entities abroad, these foreign", "paragraph_id": "para_249" }, { "text": "entities apparently lacked any authority to decide on any", "paragraph_id": "para_250" }, { "text": "terms of purchase, whether price, quantity, or even the", "paragraph_id": "para_251" }, { "text": "timing of their orders. Such parameters all were determined", "paragraph_id": "para_252" }, { "text": "centrally by Seagate Technology LLC’s Commodities", "paragraph_id": "para_253" }, { "text": "Management Team (“CMT”) in Minnesota. The foreign", "paragraph_id": "para_254" }, { "text": "companies—primarily Seagate Thailand—simply entered", "paragraph_id": "para_255" }, { "text": "orders into their purchase order systems at precisely the", "paragraph_id": "para_256" }, { "text": "times, rates, and prices that CMT instructed them to enter.", "paragraph_id": "para_257" }, { "text": "Pricing was negotiated by Seagate CMT with suppliers", "paragraph_id": "para_258" }, { "text": "quarterly. Although the master Product Supply Agreements", "paragraph_id": "para_259" }, { "text": "between Seagate Technology LLC and each supplier", "paragraph_id": "para_260" }, { "text": "contained some pricing terms (such as price floors, ceilings,", "paragraph_id": "para_261" }, { "text": "or most-favored-nation provisions), these were average or", "paragraph_id": "para_262" }, { "text": "expected prices—not actual transaction prices. Actual", "paragraph_id": "para_263" }, { "text": "transaction prices were finalized by Seagate’s CMT unit", "paragraph_id": "para_264" }, { "text": "each quarter through bidding on an RFQ, or “Request for", "paragraph_id": "para_265" }, { "text": "Quotation.” First, Seagate Technology LLC would send a", "paragraph_id": "para_266" }, { "text": "complex, custom grid to each supplier like NHK. The", "paragraph_id": "para_267" }, { "text": "supplier placed its bids across several dimensions, such as", "paragraph_id": "para_268" }, { "text": "prototypes, mass-production price, model, volume band, and", "paragraph_id": "para_269" }, { "text": "program. These RFQ “responses” from suppliers were then", "paragraph_id": "para_270" }, { "text": "10 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_271" }, { "text": "negotiated by Seagate Technology LLC’s CMT on U.S. soil,", "paragraph_id": "para_272" }, { "text": "along with the purchase volumes “allocated” to each", "paragraph_id": "para_273" }, { "text": "supplier. Finally, the agreed-upon prices and volumes were", "paragraph_id": "para_274" }, { "text": "sent by Seagate CMT to Seagate Thailand and Singapore to", "paragraph_id": "para_275" }, { "text": "use to purchase suspension assemblies at the appropriate", "paragraph_id": "para_276" }, { "text": "time.", "paragraph_id": "para_277" }, { "text": "These RFQ responses, called “anticipated pricing", "paragraph_id": "para_278" }, { "text": "quotes” in NHK’s plea agreement, also were the chief", "paragraph_id": "para_279" }, { "text": "instrument that NHK would use to fix prices. First, NHK’s", "paragraph_id": "para_280" }, { "text": "head of American SA sales would discuss specific proposed", "paragraph_id": "para_281" }, { "text": "RFQ responses for a given Seagate product with his", "paragraph_id": "para_282" }, { "text": "competitors. Next, he would relay the contents of these", "paragraph_id": "para_283" }, { "text": "discussions to top NHK executives in Yokohama, one of", "paragraph_id": "para_284" }, { "text": "whom was later indicted for his role in the conspiracy, and", "paragraph_id": "para_285" }, { "text": "another who candidly explained that NHK would use", "paragraph_id": "para_286" }, { "text": "competitor pricing information “as reference” for its own", "paragraph_id": "para_287" }, { "text": "RFQ responses. Finally, to entrench this process, NHK’s", "paragraph_id": "para_288" }, { "text": "head of American SA sales even tried to make a job posting", "paragraph_id": "para_289" }, { "text": "for a position for NHK in Minnesota that included the", "paragraph_id": "para_290" }, { "text": "requirement, “Find out competitor’s information, pricing", "paragraph_id": "para_291" }, { "text": "information”—because he “underst[oo]d that collecting", "paragraph_id": "para_292" }, { "text": "competitor pricing information” simply was part of the job.", "paragraph_id": "para_293" }, { "text": "When NHK executives in Yokohama caught wind of this,", "paragraph_id": "para_294" }, { "text": "one of them advised, “Just scratch pricing information on", "paragraph_id": "para_295" }, { "text": "competitors. That you can verbally tell once we hire.”", "paragraph_id": "para_296" }, { "text": "II. Procedural History", "paragraph_id": "para_297" }, { "text": "Shortly after NHK was sentenced in its criminal case,", "paragraph_id": "para_298" }, { "text": "Seagate sued in the Northern District of California, alleging", "paragraph_id": "para_299" }, { "text": "violations of the Sherman Act, violations of antitrust statutes", "paragraph_id": "para_300" }, { "text": "in Minnesota and California, and common-law breach of", "paragraph_id": "para_301" }, { "text": "contract. Seagate sought treble damages under Section 4 of", "paragraph_id": "para_302" }, { "text": "the Clayton Act, 15 U.S.C. § 15(a), among other relief.", "paragraph_id": "para_303" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 11", "paragraph_id": "para_304" }, { "text": "Seagate amended its complaint twice, in October 2020 and", "paragraph_id": "para_305" }, { "text": "in April 2021.", "paragraph_id": "para_306" }, { "text": "While discovery was ongoing, NHK moved for Partial", "paragraph_id": "para_307" }, { "text": "Summary Judgment Regarding Foreign Commerce. NHK", "paragraph_id": "para_308" }, { "text": "alleged that Seagate’s “direct purchaser claims arising from", "paragraph_id": "para_309" }, { "text": "component sales that took place outside the U.S.”—in other", "paragraph_id": "para_310" }, { "text": "words, claims “based on sales of [suspension assemblies]", "paragraph_id": "para_311" }, { "text": "billed and shipped to Seagate Thailand and Singapore”—", "paragraph_id": "para_312" }, { "text": "were barred by the FTAIA. 15 U.S.C. § 6a. The FTAIA", "paragraph_id": "para_313" }, { "text": "bars Sherman Act claims based on conduct involving “trade", "paragraph_id": "para_314" }, { "text": "or commerce with foreign nations,” unless that conduct", "paragraph_id": "para_315" }, { "text": "(1) involves imported goods that Americans buy or (2) “has", "paragraph_id": "para_316" }, { "text": "a direct, substantial, and reasonably foreseeable effect” on", "paragraph_id": "para_317" }, { "text": "U.S. domestic commerce or certain exports and “such effect", "paragraph_id": "para_318" }, { "text": "gives rise to” an independent Sherman Act claim. Id. NHK", "paragraph_id": "para_319" }, { "text": "essentially argued that, for example, if a suspension", "paragraph_id": "para_320" }, { "text": "assembly was bought by a Thai subsidiary in Thailand, this", "paragraph_id": "para_321" }, { "text": "qualified as wholly foreign commerce ineligible for", "paragraph_id": "para_322" }, { "text": "Sherman Act relief.", "paragraph_id": "para_323" }, { "text": "The district court at first agreed with NHK in part. In its", "paragraph_id": "para_324" }, { "text": "May 15, 2023 order, the court found that most of the", "paragraph_id": "para_325" }, { "text": "suspension assemblies purchased by Seagate Thailand and", "paragraph_id": "para_326" }, { "text": "Seagate Singapore never entered the United States at any", "paragraph_id": "para_327" }, { "text": "point. These were indeed “wholly foreign transactions,” the", "paragraph_id": "para_328" }, { "text": "court ruled, ineligible for Sherman Act relief. In re Hard", "paragraph_id": "para_329" }, { "text": "Disk Drive Suspension Assemblies Antitrust Litig. (“In re", "paragraph_id": "para_330" }, { "text": "HDD”), No. 19-md-02918, 2023 WL 3483242, at *8 (N.D.", "paragraph_id": "para_331" }, { "text": "Cal. May 15, 2023). But about one-third of Seagate’s", "paragraph_id": "para_332" }, { "text": "foreign suspension assembly purchases did eventually enter", "paragraph_id": "para_333" }, { "text": "the U.S. as part of finished hard drives. True, these parts", "paragraph_id": "para_334" }, { "text": "first were integrated into the hard drives overseas, and the", "paragraph_id": "para_335" }, { "text": "FTAIA’s import exclusion only covers conduct involving", "paragraph_id": "para_336" }, { "text": "“import trade or import commerce.” 15 U.S.C. § 6a. But the", "paragraph_id": "para_337" }, { "text": "12 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_338" }, { "text": "court held that “the import . . . exclusion can be established", "paragraph_id": "para_339" }, { "text": "without a showing that the defendants themselves shipped", "paragraph_id": "para_340" }, { "text": "price-fixed goods into” the U.S. and thus denied summary", "paragraph_id": "para_341" }, { "text": "judgment in part. Id. at *6 (emphasis added).", "paragraph_id": "para_342" }, { "text": "The district court changed direction when asked by NHK", "paragraph_id": "para_343" }, { "text": "to reconsider. First, the court held that the defendant did", "paragraph_id": "para_344" }, { "text": "have to directly ship the price-fixed goods into the United", "paragraph_id": "para_345" }, { "text": "States for the import exclusion to apply, and no suspension", "paragraph_id": "para_346" }, { "text": "assemblies were directly shipped to the U.S. here. In re", "paragraph_id": "para_347" }, { "text": "HDD, 2023 WL 8007985, at *3 (Nov. 17, 2023 order). Next,", "paragraph_id": "para_348" }, { "text": "the court held that Seagate also could not establish an", "paragraph_id": "para_349" }, { "text": "“effect” on domestic trade or commerce “giv[ing] rise to” an", "paragraph_id": "para_350" }, { "text": "independent Sherman Act claim. Id. at *5. Despite the", "paragraph_id": "para_351" }, { "text": "collusive “agreements in the United States . . . whereby the", "paragraph_id": "para_352" }, { "text": "prices for SAs . . . were set,” it was “‘the overall price-fixing", "paragraph_id": "para_353" }, { "text": "conspiracy [that] proximately caused the effect abroad,’” the", "paragraph_id": "para_354" }, { "text": "court held, and not those collusive agreements. Id. at *4", "paragraph_id": "para_355" }, { "text": "(quoting In re Dynamic Random Access Memory (DRAM)", "paragraph_id": "para_356" }, { "text": "Antitrust Litig., 546 F.3d 981, 988 (9th Cir. 2008) (“In re", "paragraph_id": "para_357" }, { "text": "DRAM”)). The district court thus granted NHK’s partial", "paragraph_id": "para_358" }, { "text": "summary judgment motion in full.", "paragraph_id": "para_359" }, { "text": "Finally, the court found Seagate’s Second Amended", "paragraph_id": "para_360" }, { "text": "Complaint did not include any “factual allegations that any", "paragraph_id": "para_361" }, { "text": "Seagate Plaintiff indirectly purchased an SA or a product", "paragraph_id": "para_362" }, { "text": "containing an SA.” Id. at *5. The court denied leave to", "paragraph_id": "para_363" }, { "text": "amend to add any such “indirect purchaser” claims, id. at *6,", "paragraph_id": "para_364" }, { "text": "and it certified the May 15, 2023 and November 17, 2023", "paragraph_id": "para_365" }, { "text": "orders for interlocutory appeal.", "paragraph_id": "para_366" }, { "text": "Seagate advances several positions on appeal: (1) that", "paragraph_id": "para_367" }, { "text": "the FTAIA does not apply to any of its claims, (2) that the", "paragraph_id": "para_368" }, { "text": "domestic effects of NHK’s price-fixing proximately caused", "paragraph_id": "para_369" }, { "text": "Seagate’s antitrust injuries abroad, and (3) that at least a", "paragraph_id": "para_370" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 13", "paragraph_id": "para_371" }, { "text": "subset of its claims qualify as “import trade or commerce.”", "paragraph_id": "para_372" }, { "text": "See 15 U.S.C. § 6a. Seagate also argues that Seagate", "paragraph_id": "para_373" }, { "text": "Technology LLC—rather than Seagate Thailand or Seagate", "paragraph_id": "para_374" }, { "text": "Singapore—was the “direct purchaser” of all the suspension", "paragraph_id": "para_375" }, { "text": "assemblies. We have jurisdiction under 28 U.S.C.", "paragraph_id": "para_376" }, { "text": "§ 1292(b), and we hold that Seagate’s theory of domestic", "paragraph_id": "para_377" }, { "text": "effects might be viable. We thus vacate the district court’s", "paragraph_id": "para_378" }, { "text": "orders and remand the case.", "paragraph_id": "para_379" }, { "text": "DISCUSSION", "paragraph_id": "para_380" }, { "text": "“We review the district court’s grant of summary", "paragraph_id": "para_381" }, { "text": "judgment de novo.” Desire, LLC v. Manna Textiles, Inc.,", "paragraph_id": "para_382" }, { "text": "986 F.3d 1253, 1259 (9th Cir. 2021) (citation omitted). We", "paragraph_id": "para_383" }, { "text": "ask, “viewing the evidence in the light most favorable to the", "paragraph_id": "para_384" }, { "text": "nonmoving party, whether there are any genuine issues of", "paragraph_id": "para_385" }, { "text": "material fact and whether the district court correctly applied", "paragraph_id": "para_386" }, { "text": "the relevant substantive law.” Delta Sav. Bank v. United", "paragraph_id": "para_387" }, { "text": "States, 265 F.3d 1017, 1021 (9th Cir. 2001) (citation", "paragraph_id": "para_388" }, { "text": "omitted). We may address “any issue fairly included” within", "paragraph_id": "para_389" }, { "text": "an order certified for appeal, “because it is the order that is", "paragraph_id": "para_390" }, { "text": "appealable, and not the controlling question identified by the", "paragraph_id": "para_391" }, { "text": "district court.” Rivera v. NIBCO, Inc., 364 F.3d 1057, 1063", "paragraph_id": "para_392" }, { "text": "(9th Cir. 2004) (citations omitted).", "paragraph_id": "para_393" }, { "text": "I. The FTAIA places geographic limits on the reach of", "paragraph_id": "para_394" }, { "text": "U.S. antitrust law.", "paragraph_id": "para_395" }, { "text": "Congress enacted the FTAIA in 1982 in part to clarify", "paragraph_id": "para_396" }, { "text": "United States antitrust jurisdiction over international", "paragraph_id": "para_397" }, { "text": "transactions—a question that had vexed our courts. See", "paragraph_id": "para_398" }, { "text": "Hartford Fire Ins. Co. v. California, 509 U.S. 764, 796 n.23", "paragraph_id": "para_399" }, { "text": "(1993); United States v. LSL Biotechnologies, 379 F.3d 672,", "paragraph_id": "para_400" }, { "text": "14 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_401" }, { "text": "677–78 (9th Cir. 2004). The statute provides that the", "paragraph_id": "para_402" }, { "text": "Sherman Act:", "paragraph_id": "para_403" }, { "text": "shall not apply to conduct involving trade or", "paragraph_id": "para_404" }, { "text": "commerce (other than import trade or import", "paragraph_id": "para_405" }, { "text": "commerce) with foreign nations unless—", "paragraph_id": "para_406" }, { "text": "(1) such conduct has a direct, substantial,", "paragraph_id": "para_407" }, { "text": "and reasonably foreseeable effect—", "paragraph_id": "para_408" }, { "text": "(A) on trade or commerce which is", "paragraph_id": "para_409" }, { "text": "not trade or commerce with foreign", "paragraph_id": "para_410" }, { "text": "nations, or on import trade or import", "paragraph_id": "para_411" }, { "text": "commerce with foreign nations; or", "paragraph_id": "para_412" }, { "text": "(B) on export trade or export", "paragraph_id": "para_413" }, { "text": "commerce with foreign nations, of a", "paragraph_id": "para_414" }, { "text": "person engaged in such trade or", "paragraph_id": "para_415" }, { "text": "commerce in the United States; and", "paragraph_id": "para_416" }, { "text": "(2) such effect gives rise to a claim under", "paragraph_id": "para_417" }, { "text": "the [Sherman Act].", "paragraph_id": "para_418" }, { "text": "15 U.S.C. § 6a. In other words, the statute generally bars the", "paragraph_id": "para_419" }, { "text": "Sherman Act from reaching foreign commercial activity, but", "paragraph_id": "para_420" }, { "text": "then adds a caveat allowing jurisdiction for foreign", "paragraph_id": "para_421" }, { "text": "commerce if the anticompetitive conduct (1) involves", "paragraph_id": "para_422" }, { "text": "“import trade or . . . commerce” (i.e., goods imported into", "paragraph_id": "para_423" }, { "text": "the United States and bought by Americans) or", "paragraph_id": "para_424" }, { "text": "(2) sufficiently affects American domestic or (certain)", "paragraph_id": "para_425" }, { "text": "export commerce that in turn proximately causes an antitrust", "paragraph_id": "para_426" }, { "text": "injury. In re DRAM, 546 F.3d at 985. These limits ensure", "paragraph_id": "para_427" }, { "text": "that the Sherman Act protects “American consumers and", "paragraph_id": "para_428" }, { "text": "American exporters, not foreign consumers or producers,”", "paragraph_id": "para_429" }, { "text": "and does not overly burden U.S. companies’ conduct", "paragraph_id": "para_430" }, { "text": "overseas. Id. at 986 (citation omitted).", "paragraph_id": "para_431" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 15", "paragraph_id": "para_432" }, { "text": "The phrasing of the FTAIA has been called confusing at", "paragraph_id": "para_433" }, { "text": "times, but the general thrust of the statute is clear. It", "paragraph_id": "para_434" }, { "text": "underscores that American courts generally are not open to", "paragraph_id": "para_435" }, { "text": "antitrust injuries occurring overseas, no matter how those", "paragraph_id": "para_436" }, { "text": "injuries arise: “American exporters” and “firms doing", "paragraph_id": "para_437" }, { "text": "business abroad” may “enter[] into business arrangements,”", "paragraph_id": "para_438" }, { "text": "no matter how “anticompetitive, as long as those", "paragraph_id": "para_439" }, { "text": "arrangements adversely affect only foreign markets.” F.", "paragraph_id": "para_440" }, { "text": "Hoffmann-La Roche Ltd. v. Empagran S.A., 542 U.S. 155,", "paragraph_id": "para_441" }, { "text": "161 (2004) (citing House Report). If a foreign country does", "paragraph_id": "para_442" }, { "text": "not forbid certain anticompetitive conduct, then American", "paragraph_id": "para_443" }, { "text": "companies doing business there can engage in such conduct,", "paragraph_id": "para_444" }, { "text": "even if it would be unlawful here. Otherwise, we would be", "paragraph_id": "para_445" }, { "text": "disadvantaging American companies competing in foreign", "paragraph_id": "para_446" }, { "text": "markets.", "paragraph_id": "para_447" }, { "text": "Congress thus did not expand the purview of our antitrust", "paragraph_id": "para_448" }, { "text": "laws to reach “foreign conduct that causes independent", "paragraph_id": "para_449" }, { "text": "foreign harm,” except “where that conduct also causes", "paragraph_id": "para_450" }, { "text": "domestic harm.” Id. at 166. As this court has noted, a", "paragraph_id": "para_451" }, { "text": "“transaction between two foreign firms, even if American-", "paragraph_id": "para_452" }, { "text": "owned, should not, merely by virtue of the American", "paragraph_id": "para_453" }, { "text": "ownership, come within the reach of our antitrust laws,”", "paragraph_id": "para_454" }, { "text": "unless specifically provided for by the FTAIA. United", "paragraph_id": "para_455" }, { "text": "States v. Hui Hsiung, 778 F.3d 738, 754 (9th Cir. 2015)", "paragraph_id": "para_456" }, { "text": "(quoting House Report).", "paragraph_id": "para_457" }, { "text": "Indeed, there is good reason to be circumspect when it", "paragraph_id": "para_458" }, { "text": "comes to the Sherman Act’s territorial scope. Beyond", "paragraph_id": "para_459" }, { "text": "merely supporting American firms’ competitiveness abroad,", "paragraph_id": "para_460" }, { "text": "the Supreme Court has highlighted international comity and", "paragraph_id": "para_461" }, { "text": "refraining from interfering in other countries’ regulation of", "paragraph_id": "para_462" }, { "text": "their own economies, at least where no Americans are", "paragraph_id": "para_463" }, { "text": "harmed. See, e.g., Empagran, 542 U.S. at 164–68. Even", "paragraph_id": "para_464" }, { "text": "where it is an American-owned company that suffers", "paragraph_id": "para_465" }, { "text": "16 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_466" }, { "text": "antitrust injury abroad, so long as that company chose to", "paragraph_id": "para_467" }, { "text": "incorporate overseas, it must take the good with the bad", "paragraph_id": "para_468" }, { "text": "when it comes to that country’s legal regime. As the Seventh", "paragraph_id": "para_469" }, { "text": "Circuit noted, a company cannot “pick and choose from the", "paragraph_id": "para_470" }, { "text": "benefits . . . of [U.S.] corporate citizenship” by availing itself", "paragraph_id": "para_471" }, { "text": "of the Sherman and Clayton Acts while avoiding compliance", "paragraph_id": "para_472" }, { "text": "with United States tax, labor, and environmental", "paragraph_id": "para_473" }, { "text": "requirements by choosing to do business through foreign", "paragraph_id": "para_474" }, { "text": "entities. Motorola Mobility LLC v. AU Optronics Corp., 775", "paragraph_id": "para_475" }, { "text": "F.3d 816, 822, 827 (7th Cir. 2015); see also Empagran, 542", "paragraph_id": "para_476" }, { "text": "U.S. at 166.", "paragraph_id": "para_477" }, { "text": "In short, American antitrust protections apply only when", "paragraph_id": "para_478" }, { "text": "there is a direct and proximate link to U.S. harm. Congress", "paragraph_id": "para_479" }, { "text": "provided a few ways to establish that link even where the", "paragraph_id": "para_480" }, { "text": "ultimate antitrust injury occurs overseas.", "paragraph_id": "para_481" }, { "text": "First, “import trade” and “import commerce” are", "paragraph_id": "para_482" }, { "text": "excluded from the FTAIA’s ban on extraterritorial reach", "paragraph_id": "para_483" }, { "text": "(i.e., the Sherman Act applies). See 15 U.S.C. § 6a; Hui", "paragraph_id": "para_484" }, { "text": "Hsiung, 778 F.3d at 754. For example, if Japanese", "paragraph_id": "para_485" }, { "text": "carmakers fix prices of their cars in Japan but import them", "paragraph_id": "para_486" }, { "text": "into the United States, then American antitrust laws would", "paragraph_id": "para_487" }, { "text": "cover such conduct under the FTAIA’s “import commerce”", "paragraph_id": "para_488" }, { "text": "exclusion.", "paragraph_id": "para_489" }, { "text": "Second, the Sherman Act also applies to anticompetitive", "paragraph_id": "para_490" }, { "text": "conduct (a) that has a harmful effect on domestic or (certain)", "paragraph_id": "para_491" }, { "text": "export trade or commerce, and (b) such effect “gives rise to”", "paragraph_id": "para_492" }, { "text": "an independent Sherman Act claim. 15 U.S.C. § 6a(1)–(2);", "paragraph_id": "para_493" }, { "text": "see Empagran, 542 U.S. at 174. This is sometimes called", "paragraph_id": "para_494" }, { "text": "the FTAIA’s “domestic effects” exception.", "paragraph_id": "para_495" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 17", "paragraph_id": "para_496" }, { "text": "We next turn to whether Seagate meets either the “import", "paragraph_id": "para_497" }, { "text": "commerce” exclusion or the “domestic effects” exception", "paragraph_id": "para_498" }, { "text": "under the FTAIA.3", "paragraph_id": "para_499" }, { "text": "II. The FTAIA’s “import commerce” exclusion does", "paragraph_id": "para_500" }, { "text": "not apply because the SAs were not directly", "paragraph_id": "para_501" }, { "text": "imported into the United States.", "paragraph_id": "para_502" }, { "text": "Seagate Thailand and Seagate Singapore bought price-", "paragraph_id": "para_503" }, { "text": "fixed suspension assemblies outside the United States. One", "paragraph_id": "para_504" }, { "text": "way these foreign entities could bring a Sherman Act claim", "paragraph_id": "para_505" }, { "text": "for their purchases is if the suspension assemblies were", "paragraph_id": "para_506" }, { "text": "directly imported into this country. NHK’s price-fixing", "paragraph_id": "para_507" }, { "text": "conduct would then be “conduct involving . . . import trade", "paragraph_id": "para_508" }, { "text": "or . . . commerce,” and would be exempt from the FTAIA’s", "paragraph_id": "para_509" }, { "text": "ban on extraterritorial application of U.S. antitrust law. 15", "paragraph_id": "para_510" }, { "text": "U.S.C. § 6a.", "paragraph_id": "para_511" }, { "text": "But NHK’s price-fixing conduct did not involve “import", "paragraph_id": "para_512" }, { "text": "trade or . . . commerce” because the suspension assemblies", "paragraph_id": "para_513" }, { "text": "by themselves were not imported into the United States.", "paragraph_id": "para_514" }, { "text": "Only the finished hard disk drives were imported into the", "paragraph_id": "para_515" }, { "text": "United States. Any trade or commerce involving suspension", "paragraph_id": "para_516" }, { "text": "assemblies was thus not “import trade or . . . commerce,” but", "paragraph_id": "para_517" }, { "text": "merely “trade or commerce . . . with foreign nations.” Id.", "paragraph_id": "para_518" }, { "text": "A few factual clarifications may be helpful. First,", "paragraph_id": "para_519" }, { "text": "Seagate does not dispute that none of the suspension", "paragraph_id": "para_520" }, { "text": "assemblies at issue were directly sent to the United States", "paragraph_id": "para_521" }, { "text": "3 Seagate argues that the FTAIA is not relevant here because this case", "paragraph_id": "para_522" }, { "text": "involves price-fixing conduct that took place in the United States, while", "paragraph_id": "para_523" }, { "text": "the FTAIA only covers “wholly foreign” commerce. Not so. The", "paragraph_id": "para_524" }, { "text": "Supreme Court held that the FTAIA applied in Empagran even though", "paragraph_id": "para_525" }, { "text": "“some of the anticompetitive price-fixing conduct alleged . . . took place", "paragraph_id": "para_526" }, { "text": "in America,” 542 U.S. at 163, 165, and we did the same in Hui Hsiung,", "paragraph_id": "para_527" }, { "text": "778 F.3d at 743, 753.", "paragraph_id": "para_528" }, { "text": "18 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_529" }, { "text": "after Seagate bought them. They were first incorporated into", "paragraph_id": "para_530" }, { "text": "hard disk drive components and hard disk drives, which were", "paragraph_id": "para_531" }, { "text": "later imported to the U.S. Second, Seagate also concedes", "paragraph_id": "para_532" }, { "text": "that it does not sell suspension assemblies—indeed, there is", "paragraph_id": "para_533" }, { "text": "no consumer market for them, only for finished hard disk", "paragraph_id": "para_534" }, { "text": "drives.", "paragraph_id": "para_535" }, { "text": "Seagate mainly relies on two related arguments to argue", "paragraph_id": "para_536" }, { "text": "that the “import exclusion” applies: (1) that a qualifying", "paragraph_id": "para_537" }, { "text": "import need not be a direct import but may come through", "paragraph_id": "para_538" }, { "text": "intermediate steps in “the supply chain,” and (2) that the", "paragraph_id": "para_539" }, { "text": "FTAIA exempts not only import trade and commerce but", "paragraph_id": "para_540" }, { "text": "also “conduct involving . . . import commerce,” which,", "paragraph_id": "para_541" }, { "text": "again, includes the broader “supply chain.” Seagate thus", "paragraph_id": "para_542" }, { "text": "argues that the one-third of suspension assemblies that later", "paragraph_id": "para_543" }, { "text": "entered the U.S. as part of finished hard disk drives qualify", "paragraph_id": "para_544" }, { "text": "as imports under the FTAIA, and that NHK’s price-fixing", "paragraph_id": "para_545" }, { "text": "activity constitutes conduct involving import trade.", "paragraph_id": "para_546" }, { "text": "These arguments are unconvincing. For starters, we", "paragraph_id": "para_547" }, { "text": "usually interpret words as “understood in their ordinary,", "paragraph_id": "para_548" }, { "text": "everyday meanings.” Antonin Scalia & Bryan A. Garner,", "paragraph_id": "para_549" }, { "text": "READING LAW: THE INTERPRETATION OF LEGAL TEXTS 69", "paragraph_id": "para_550" }, { "text": "(2012). And we have never defined “import trade or", "paragraph_id": "para_551" }, { "text": "commerce” so broadly as to encompass parts incorporated", "paragraph_id": "para_552" }, { "text": "into the imported goods. Rather, we usually refer to the final", "paragraph_id": "para_553" }, { "text": "end-product, not specific parts within it, when we talk about", "paragraph_id": "para_554" }, { "text": "an imported good. Take smartphones made by the South", "paragraph_id": "para_555" }, { "text": "Korean company Samsung. Many of its phones use batteries", "paragraph_id": "para_556" }, { "text": "or other parts made in third countries such as China or", "paragraph_id": "para_557" }, { "text": "Vietnam. We would normally describe Samsung phones as", "paragraph_id": "para_558" }, { "text": "imported goods from South Korea, despite some internal", "paragraph_id": "para_559" }, { "text": "parts being made elsewhere.", "paragraph_id": "para_560" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 19", "paragraph_id": "para_561" }, { "text": "In Hui Hsiung, we strongly suggested that the “import", "paragraph_id": "para_562" }, { "text": "trade or commerce” exception in the FTAIA applies only to", "paragraph_id": "para_563" }, { "text": "the final imported end-product. That case dealt with TFT–", "paragraph_id": "para_564" }, { "text": "LCD liquid crystal display panels found in many computer", "paragraph_id": "para_565" }, { "text": "screens. While the case involved both panels that were", "paragraph_id": "para_566" }, { "text": "directly sold into the United States and panels first", "paragraph_id": "para_567" }, { "text": "incorporated into computers abroad and then sold here, 778", "paragraph_id": "para_568" }, { "text": "F.3d at 753, we considered only panels that came directly to", "paragraph_id": "para_569" }, { "text": "the U.S. (as panels) in analyzing “import trade,” see id. at", "paragraph_id": "para_570" }, { "text": "755. We repeatedly emphasized that the defendant", "paragraph_id": "para_571" }, { "text": "manufacturers sold panels “to customers in the United", "paragraph_id": "para_572" }, { "text": "States.” Id. And most of all, we explained that even though", "paragraph_id": "para_573" }, { "text": "the defendants “did not manufacture any consumer products", "paragraph_id": "para_574" }, { "text": "for importation into the United States,” they “negotiated", "paragraph_id": "para_575" }, { "text": "with United States companies in the United States to sell", "paragraph_id": "para_576" }, { "text": "TFT–LCD panels at [fixed] prices . . . . [and] [i]mportation", "paragraph_id": "para_577" }, { "text": "of this critical component of various electronic devices is", "paragraph_id": "para_578" }, { "text": "surely ‘import trade or import commerce.’” Id. at 756", "paragraph_id": "para_579" }, { "text": "(emphasis added). In other words, the display panels by", "paragraph_id": "para_580" }, { "text": "themselves were imported as components in Hui Hsiung.", "paragraph_id": "para_581" }, { "text": "We thus held that “transactions . . . directly between the U.S.", "paragraph_id": "para_582" }, { "text": "plaintiff purchasers and the defendant cartel members are", "paragraph_id": "para_583" }, { "text": ". . . import commerce,” and “goods manufactured abroad", "paragraph_id": "para_584" }, { "text": "and sold in the United States [are] import commerce.” Id. at", "paragraph_id": "para_585" }, { "text": "755 (citations omitted). In contrast here, the suspension", "paragraph_id": "para_586" }, { "text": "assemblies were neither purchased by buyers in the United", "paragraph_id": "para_587" }, { "text": "States nor “sold” in (or into) the United States. In short,", "paragraph_id": "para_588" }, { "text": "mere parts in the international supply chain lack sufficient", "paragraph_id": "para_589" }, { "text": "U.S. nexus to justify the extraterritorial reach of American", "paragraph_id": "para_590" }, { "text": "antitrust laws.", "paragraph_id": "para_591" }, { "text": "True, Hui Hsiung dealt with the sufficiency of an", "paragraph_id": "para_592" }, { "text": "indictment and of evidence to support a jury verdict and thus", "paragraph_id": "para_593" }, { "text": "did not define the outer limits of import trade. See id. at 755–", "paragraph_id": "para_594" }, { "text": "20 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_595" }, { "text": "56 & n.8. But nothing in the case suggests that it would", "paragraph_id": "para_596" }, { "text": "include activities “up and down the supply chain,” as", "paragraph_id": "para_597" }, { "text": "Seagate suggests. It is also true that suspension assemblies", "paragraph_id": "para_598" }, { "text": "“have no use other than as a hard-drive component,” as", "paragraph_id": "para_599" }, { "text": "Seagate notes. But Seagate fails to explain why this should", "paragraph_id": "para_600" }, { "text": "work in its favor. No circuit authority suggests that every", "paragraph_id": "para_601" }, { "text": "foreign component cartel must have redressability under the", "paragraph_id": "para_602" }, { "text": "FTAIA’s import exclusion, seeing as relief may still be", "paragraph_id": "para_603" }, { "text": "available under the statute’s effects exceptions. See, e.g.,", "paragraph_id": "para_604" }, { "text": "Hui Hsiung, 778 F.3d at 760.", "paragraph_id": "para_605" }, { "text": "In sum, Seagate was harmed not in the import trade but", "paragraph_id": "para_606" }, { "text": "several steps up in its manufacturing supply chain—and a", "paragraph_id": "para_607" }, { "text": "“transaction between two foreign firms” typically must seek", "paragraph_id": "para_608" }, { "text": "relief not through the FTAIA’s import commerce exclusion", "paragraph_id": "para_609" }, { "text": "but through the domestic effects exception. Id. at 754. We", "paragraph_id": "para_610" }, { "text": "turn to that next.", "paragraph_id": "para_611" }, { "text": "III. The FTAIA’s “domestic effects” exception might", "paragraph_id": "para_612" }, { "text": "apply and allow Seagate to pursue its antitrust", "paragraph_id": "para_613" }, { "text": "claims against NHK.", "paragraph_id": "para_614" }, { "text": "The FTAIA has another exception—“domestic", "paragraph_id": "para_615" }, { "text": "effects”—that allows extraterritorial application of", "paragraph_id": "para_616" }, { "text": "American antitrust law. Foreign non-import commerce can", "paragraph_id": "para_617" }, { "text": "fall within the Sherman Act if the anti-competitive conduct", "paragraph_id": "para_618" }, { "text": "(1) has a “direct, substantial, and reasonably foreseeable", "paragraph_id": "para_619" }, { "text": "effect” on certain U.S.-based commerce, and (2) that effect", "paragraph_id": "para_620" }, { "text": "“gives rise to” an antitrust claim. See 15 U.S.C. § 6a. As", "paragraph_id": "para_621" }, { "text": "the Supreme Court stated in Empagran, “there should be no", "paragraph_id": "para_622" }, { "text": "American antitrust jurisdiction absent a direct, substantial", "paragraph_id": "para_623" }, { "text": "and reasonably foreseeable effect on domestic commerce or", "paragraph_id": "para_624" }, { "text": "a domestic competitor.” 542 U.S. at 163 (quoting House", "paragraph_id": "para_625" }, { "text": "Report); accord Hui Hsiung, 778 F.3d at 754.", "paragraph_id": "para_626" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 21", "paragraph_id": "para_627" }, { "text": "The two requirements above are strict by design. A", "paragraph_id": "para_628" }, { "text": "“direct” effect on U.S.-based commerce means the effect", "paragraph_id": "para_629" }, { "text": "must “follow[] as an immediate consequence of the", "paragraph_id": "para_630" }, { "text": "defendant’s activity.” LSL, 379 F.3d at 680; see Hui Hsiung,", "paragraph_id": "para_631" }, { "text": "778 F.3d at 758 & n.9. An “effect cannot be ‘direct’ where", "paragraph_id": "para_632" }, { "text": "it depends on . . . uncertain intervening developments.” LSL,", "paragraph_id": "para_633" }, { "text": "379 F.3d at 681. And to “give[] rise to” a Sherman Act claim", "paragraph_id": "para_634" }, { "text": "means the effect (on U.S. commerce) must proximately", "paragraph_id": "para_635" }, { "text": "cause the antitrust injury. In re DRAM, 546 F.3d at 988.", "paragraph_id": "para_636" }, { "text": "“‘[B]ut for’ causation cannot suffice for the FTAIA,” such", "paragraph_id": "para_637" }, { "text": "as where intervening forces may have caused the ultimate", "paragraph_id": "para_638" }, { "text": "antitrust injury. Id. at 987; see Hui Hsiung, 778 F.3d at 758.", "paragraph_id": "para_639" }, { "text": "Together, these requirements ensure there is a sufficient", "paragraph_id": "para_640" }, { "text": "nexus to the United States such that we open our courts", "paragraph_id": "para_641" }, { "text": "despite the foreign elements. They require a tight causal link", "paragraph_id": "para_642" }, { "text": "between the defendant’s anticompetitive conduct, the effect", "paragraph_id": "para_643" }, { "text": "on U.S. commerce, and the ultimate antitrust injury. There", "paragraph_id": "para_644" }, { "text": "must be a direct impact in the United States tethered to a", "paragraph_id": "para_645" }, { "text": "Sherman Act violation. Put differently, U.S. courts are only", "paragraph_id": "para_646" }, { "text": "open to foreign antitrust injuries that arise through harm to", "paragraph_id": "para_647" }, { "text": "U.S. commerce. See Empagran, 542 U.S. at 174.", "paragraph_id": "para_648" }, { "text": "A. NHK’s price-fixing had a harmful effect on U.S.", "paragraph_id": "para_649" }, { "text": "domestic commerce.", "paragraph_id": "para_650" }, { "text": "We address the first prong of the domestic effects", "paragraph_id": "para_651" }, { "text": "exception: Seagate must show that NHK’s conduct caused", "paragraph_id": "para_652" }, { "text": "an immediate harm to U.S. domestic commerce. See id.", "paragraph_id": "para_653" }, { "text": "(requiring an adverse effect). Seagate asserts that “NHK", "paragraph_id": "para_654" }, { "text": "colluded to rig bids in the United States, and the domestic", "paragraph_id": "para_655" }, { "text": "effects of that conduct [were] distorted bidding, suppressed", "paragraph_id": "para_656" }, { "text": "competition, and binding agreements incorporating price-", "paragraph_id": "para_657" }, { "text": "fixed terms.”", "paragraph_id": "para_658" }, { "text": "22 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_659" }, { "text": "These facts are largely undisputed. NHK admits in its", "paragraph_id": "para_660" }, { "text": "plea deal with the United States government that it agreed", "paragraph_id": "para_661" }, { "text": "with another competitor “to refrain from competing on", "paragraph_id": "para_662" }, { "text": "prices for, fix the prices of, and allocate their respective", "paragraph_id": "para_663" }, { "text": "market shares for, HDD suspension assemblies to be sold in", "paragraph_id": "para_664" }, { "text": "the United States and elsewhere.” It further admits it", "paragraph_id": "para_665" }, { "text": "“exchanged [suspension assembly] pricing information,", "paragraph_id": "para_666" }, { "text": "including anticipated pricing quotes,” with its competitor", "paragraph_id": "para_667" }, { "text": "and “used the exchanged information to inform their", "paragraph_id": "para_668" }, { "text": "negotiations with U.S. and foreign customers that purchased", "paragraph_id": "para_669" }, { "text": "HDD suspension assemblies.” The parties in their briefing", "paragraph_id": "para_670" }, { "text": "have not identified how many of NHK’s price-fixed SAs", "paragraph_id": "para_671" }, { "text": "were sold within the United States or to American", "paragraph_id": "para_672" }, { "text": "companies but NHK sold them to a wide range of", "paragraph_id": "para_673" }, { "text": "companies, including Seagate, Toshiba, Western Digital,", "paragraph_id": "para_674" }, { "text": "Quantum, IBM, Fujitsu, Samsung, and Hitachi, during the", "paragraph_id": "para_675" }, { "text": "relevant period. While we do not know the dollar value of", "paragraph_id": "para_676" }, { "text": "the price-fixed SAs sold in the United States, NHK in its plea", "paragraph_id": "para_677" }, { "text": "deal conceded that “[d]uring the relevant period, the", "paragraph_id": "para_678" }, { "text": "conspiracy . . . had a direct, substantial, and reasonably", "paragraph_id": "para_679" }, { "text": "foreseeable effect on interstate and import trade []", "paragraph_id": "para_680" }, { "text": "commerce.” So NHK’s plea agreement alone appears to", "paragraph_id": "para_681" }, { "text": "confirm the first prong of the domestic effects exception:", "paragraph_id": "para_682" }, { "text": "NHK admits to fixing prices of suspension assemblies sold", "paragraph_id": "para_683" }, { "text": "in the United States (as well as around the world), and", "paragraph_id": "para_684" }, { "text": "NHK’s actions apparently had a direct, substantial, and", "paragraph_id": "para_685" }, { "text": "reasonably foreseeable effect on U.S. commerce. See 15", "paragraph_id": "para_686" }, { "text": "U.S.C. § 6a(1).4", "paragraph_id": "para_687" }, { "text": "4 NHK’s argument that a corrupt U.S. bidding process can only", "paragraph_id": "para_688" }, { "text": "constitute “conduct” under the FTAIA—and not an “effect” of conduct—", "paragraph_id": "para_689" }, { "text": "betrays its plea deal that “the conspiracy involved and had a direct,", "paragraph_id": "para_690" }, { "text": "substantial, and reasonably foreseeable effect on” interstate commerce.", "paragraph_id": "para_691" }, { "text": "While the actual “stuff” of NHK’s conspiracy (illicit meetings, illegal", "paragraph_id": "para_692" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 23", "paragraph_id": "para_693" }, { "text": "To be sure, the domestic effect from NHK’s", "paragraph_id": "para_694" }, { "text": "anticompetitive conduct did not directly injure Seagate", "paragraph_id": "para_695" }, { "text": "Technology LLC because it did not buy the suspension", "paragraph_id": "para_696" }, { "text": "assemblies here—its foreign entities did abroad. But the first", "paragraph_id": "para_697" }, { "text": "prong of the domestic effects exception still has been met", "paragraph_id": "para_698" }, { "text": "because NHK admitted in its plea deal that it “fix[ed] the", "paragraph_id": "para_699" }, { "text": "prices” of “suspension assemblies to be sold in the United", "paragraph_id": "para_700" }, { "text": "States and elsewhere.” (emphasis added). In other words,", "paragraph_id": "para_701" }, { "text": "NHK’s price-fixing apparently had a significant and direct", "paragraph_id": "para_702" }, { "text": "impact on domestic commerce because companies (other", "paragraph_id": "para_703" }, { "text": "than Seagate Technology LLC) overpaid for the suspension", "paragraph_id": "para_704" }, { "text": "assemblies bought here in the states.", "paragraph_id": "para_705" }, { "text": "The FTAIA’s statutory language does not require more", "paragraph_id": "para_706" }, { "text": "than that to satisfy the first prong: The anticompetitive", "paragraph_id": "para_707" }, { "text": "conduct must have “a direct, substantial, and reasonably", "paragraph_id": "para_708" }, { "text": "effect on trade or commerce which is not trade or commerce", "paragraph_id": "para_709" }, { "text": "with foreign nations [i.e., domestic commerce] or on import", "paragraph_id": "para_710" }, { "text": "trade or import commerce with foreign nations.” 15 U.S.C.", "paragraph_id": "para_711" }, { "text": "§ 6a. Unlike the second prong (which refers to a Sherman", "paragraph_id": "para_712" }, { "text": "Act “claim” by the plaintiff), the first prong makes no", "paragraph_id": "para_713" }, { "text": "mention of “claim” or “injury” by the plaintiff—it just", "paragraph_id": "para_714" }, { "text": "requires a direct and substantial “effect” on the American", "paragraph_id": "para_715" }, { "text": "economy. Stated differently, the first prong does not require", "paragraph_id": "para_716" }, { "text": "the plaintiff to have suffered an injury in the United States in", "paragraph_id": "para_717" }, { "text": "addition to outside of it; indeed, if it did suffer harm in the", "paragraph_id": "para_718" }, { "text": "United States, the FTAIA may not even apply. We", "paragraph_id": "para_719" }, { "text": "recognized this point in In re DRAM: The plaintiff there was", "paragraph_id": "para_720" }, { "text": "a “foreign consumer that made its purchases entirely outside", "paragraph_id": "para_721" }, { "text": "bids, and so on) count as conduct, “higher U.S. prices” can be a", "paragraph_id": "para_722" }, { "text": "“domestic effect.” In re DRAM, 546 F.3d at 984, 988; see also", "paragraph_id": "para_723" }, { "text": "Empagran, 542 U.S. at 175 (calling “higher prices in the United States”", "paragraph_id": "para_724" }, { "text": "an “adverse domestic effect”); 15 U.S.C. § 1 (prohibiting conduct with", "paragraph_id": "para_725" }, { "text": "the effect of restraining trade).", "paragraph_id": "para_726" }, { "text": "24 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_727" }, { "text": "of the United States,” but we assumed that the first prong of", "paragraph_id": "para_728" }, { "text": "the domestic effects exception had been met because the", "paragraph_id": "para_729" }, { "text": "conspiracy had “raise[ed] the price of DRAM to customers", "paragraph_id": "para_730" }, { "text": "in both the United States and foreign countries.” 546 F.3d", "paragraph_id": "para_731" }, { "text": "at 989, 984. The plaintiff’s claim in In re DRAM, however,", "paragraph_id": "para_732" }, { "text": "failed because it could not meet the second prong that the", "paragraph_id": "para_733" }, { "text": "domestic effect of higher U.S. prices proximately caused its", "paragraph_id": "para_734" }, { "text": "foreign injury. Id. The D.C. Circuit appears to share our", "paragraph_id": "para_735" }, { "text": "view of the first prong requirement of the domestic effects", "paragraph_id": "para_736" }, { "text": "exception. See Empagran S.A. v. F. Hoffman-LaRoche Ltd.,", "paragraph_id": "para_737" }, { "text": "417 F.3d 1267, 1269 (D.C. Cir. 2005) (plaintiffs “need only", "paragraph_id": "para_738" }, { "text": "demonstrate therefore that the U.S. effects of the", "paragraph_id": "para_739" }, { "text": "[defendants’] allegedly anti-competitive conduct ‘[g]ave rise", "paragraph_id": "para_740" }, { "text": "to’ their claims” because the statutory text looks at the “situs", "paragraph_id": "para_741" }, { "text": "of the effects of the allegedly anti-competitive conduct,” not", "paragraph_id": "para_742" }, { "text": "the “situs of the . . . resulting injuries”) (emphasis added).", "paragraph_id": "para_743" }, { "text": "Similarly here, Seagate need not show that it was injured", "paragraph_id": "para_744" }, { "text": "directly from the domestic effect of NHK’s anticompetitive", "paragraph_id": "para_745" }, { "text": "conduct here in America under the first prong of the", "paragraph_id": "para_746" }, { "text": "domestic effects exception. It is enough to show that NHK’s", "paragraph_id": "para_747" }, { "text": "actions had a direct, substantial, and reasonably foreseeable", "paragraph_id": "para_748" }, { "text": "effect on domestic commerce by fixing prices of suspension", "paragraph_id": "para_749" }, { "text": "assemblies sold here. But that is not the end of the matter.", "paragraph_id": "para_750" }, { "text": "Under the second prong, Seagate must show that this", "paragraph_id": "para_751" }, { "text": "domestic effect gave “rise to a claim under the [Sherman", "paragraph_id": "para_752" }, { "text": "Act].” Id. We address that next.", "paragraph_id": "para_753" }, { "text": "B. The tainted RFQ prices potentially gave rise to", "paragraph_id": "para_754" }, { "text": "Seagate’s antitrust claims.", "paragraph_id": "para_755" }, { "text": "To meet the second prong of the domestic effects", "paragraph_id": "para_756" }, { "text": "exception, Seagate must show that the harm of NHK’s", "paragraph_id": "para_757" }, { "text": "conduct on U.S. domestic commerce directly caused Seagate", "paragraph_id": "para_758" }, { "text": "Thailand’s and Seagate Singapore’s respective overcharge", "paragraph_id": "para_759" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 25", "paragraph_id": "para_760" }, { "text": "claims. See 15 U.S.C. § 6a(2). In other words, we ask", "paragraph_id": "para_761" }, { "text": "whether “[o]ther actors or forces may have affected the", "paragraph_id": "para_762" }, { "text": "foreign prices”—if so, then the plaintiff has not met the", "paragraph_id": "para_763" }, { "text": "second prong. In re DRAM, 546 F.3d at 988.", "paragraph_id": "para_764" }, { "text": "Most foreign injury claims fail at this step because it is", "paragraph_id": "para_765" }, { "text": "often difficult to show that the harmful effect on U.S.", "paragraph_id": "para_766" }, { "text": "domestic commerce proximately caused the foreign antitrust", "paragraph_id": "para_767" }, { "text": "injury. Too often the link is too speculative or attenuated.", "paragraph_id": "para_768" }, { "text": "Seagate’s claim, however, appears to be viable because of", "paragraph_id": "para_769" }, { "text": "the unique nature of how the master Product Supply", "paragraph_id": "para_770" }, { "text": "Agreement and the quarterly RFQs—all negotiated in the", "paragraph_id": "para_771" }, { "text": "United States by Seagate Technology LLC—set the U.S.", "paragraph_id": "para_772" }, { "text": "prices for suspension assemblies, which in turn set the prices", "paragraph_id": "para_773" }, { "text": "of the foreign suspension assembly purchases. As discussed,", "paragraph_id": "para_774" }, { "text": "Seagate has provided evidence that its foreign subsidiaries", "paragraph_id": "para_775" }, { "text": "lacked any authority over the price, quantity, or timing of", "paragraph_id": "para_776" }, { "text": "their orders. They had to follow the lead of U.S.-based", "paragraph_id": "para_777" }, { "text": "Seagate Technology LLC and entered orders at the (inflated)", "paragraph_id": "para_778" }, { "text": "prices negotiated by Seagate Technology LLC’s CMT unit.", "paragraph_id": "para_779" }, { "text": "At oral argument, NHK admitted that suspension assembly", "paragraph_id": "para_780" }, { "text": "prices were negotiated not per transaction but “quarterly”—", "paragraph_id": "para_781" }, { "text": "i.e., through the RFQ process. Thus, the higher U.S. prices", "paragraph_id": "para_782" }, { "text": "for suspension assemblies resulting from NHK’s price-", "paragraph_id": "para_783" }, { "text": "fixing would have directly caused Seagate’s foreign", "paragraph_id": "para_784" }, { "text": "subsidiaries to overpay. Or as Seagate would have it, there", "paragraph_id": "para_785" }, { "text": "only was one price, the U.S. and foreign prices being “one", "paragraph_id": "para_786" }, { "text": "and the same.”", "paragraph_id": "para_787" }, { "text": "The district court credited this evidence in its May 15", "paragraph_id": "para_788" }, { "text": "order, finding that Seagate Technology LLC’s U.S.-based", "paragraph_id": "para_789" }, { "text": "“agreement[s] governed the sales when ‘purchase orders’ for", "paragraph_id": "para_790" }, { "text": "SAs were placed by Seagate Thailand” including as to price.", "paragraph_id": "para_791" }, { "text": "The court in its November 17 order also acknowledged", "paragraph_id": "para_792" }, { "text": "Seagate’s theory that “the prices for SAs to be charged to", "paragraph_id": "para_793" }, { "text": "26 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_794" }, { "text": "Seagate entities located outside the United States were set”", "paragraph_id": "para_795" }, { "text": "directly by the tainted “agreements in the [U.S.].” Yet the", "paragraph_id": "para_796" }, { "text": "district court called this theory “essentially the same” as In", "paragraph_id": "para_797" }, { "text": "re DRAM, 546 F.3d at 988–89. The court observed, “[T]hat", "paragraph_id": "para_798" }, { "text": "the conspiracy had effects in the United States and abroad,", "paragraph_id": "para_799" }, { "text": "does not show that the effect in the United States, rather than", "paragraph_id": "para_800" }, { "text": "the overall price-fixing conspiracy itself, proximately caused", "paragraph_id": "para_801" }, { "text": "the effect abroad.” In re HDD, 2023 WL 8007985, at *4", "paragraph_id": "para_802" }, { "text": "(quoting In re DRAM, 546 F.3d at 988).", "paragraph_id": "para_803" }, { "text": "We believe the district court erred in reading In re DRAM", "paragraph_id": "para_804" }, { "text": "as categorically holding that rigged U.S. prices cannot", "paragraph_id": "para_805" }, { "text": "proximately cause injuries abroad. In that case, we rejected", "paragraph_id": "para_806" }, { "text": "the tenuous theory that higher U.S. prices for computer", "paragraph_id": "para_807" }, { "text": "memory chips (i.e., the domestic effect) proximately caused", "paragraph_id": "para_808" }, { "text": "higher global pricing (i.e., the foreign injury) because the", "paragraph_id": "para_809" }, { "text": "plaintiff relied on the interconnected nature of the computer", "paragraph_id": "para_810" }, { "text": "memory chip market and the leading role of U.S. buyers.", "paragraph_id": "para_811" }, { "text": "546 F.3d at 984. Relying on a chain of inferences about", "paragraph_id": "para_812" }, { "text": "global pricing of memory chips, the plaintiff in In re DRAM", "paragraph_id": "para_813" }, { "text": "did “not sufficiently allege a theory that the higher U.S.", "paragraph_id": "para_814" }, { "text": "prices proximately caused [the plaintiff’s] foreign injury of", "paragraph_id": "para_815" }, { "text": "having to pay higher prices outside the United States.” Id.", "paragraph_id": "para_816" }, { "text": "at 989. In short, there were links missing in the chain:", "paragraph_id": "para_817" }, { "text": "“Other actors or forces may have affected the foreign", "paragraph_id": "para_818" }, { "text": "prices.” Id. at 988.", "paragraph_id": "para_819" }, { "text": "Seagate’s theory, in contrast, is rooted in the certainty of", "paragraph_id": "para_820" }, { "text": "binding pricing contracts—not the complex vagaries of the", "paragraph_id": "para_821" }, { "text": "global pricing market. It does not rely on the alleged", "paragraph_id": "para_822" }, { "text": "equivalence of prices across global trading markets that", "paragraph_id": "para_823" }, { "text": "many courts have rejected. See id; see also Empagran, 542", "paragraph_id": "para_824" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 27", "paragraph_id": "para_825" }, { "text": "U.S. at 175. 5 Rather, Seagate explains exactly how", "paragraph_id": "para_826" }, { "text": "“[d]efendants’ activities resulted in the U.S. prices directly", "paragraph_id": "para_827" }, { "text": "setting the worldwide price” and thus causing the foreign", "paragraph_id": "para_828" }, { "text": "antitrust injury: NHK and a competitor conspired to fix", "paragraph_id": "para_829" }, { "text": "prices, setting inflated U.S. prices (i.e., the domestic effect)", "paragraph_id": "para_830" }, { "text": "that Seagate’s foreign entities then accepted as a matter of", "paragraph_id": "para_831" }, { "text": "company policy and contractual requirements (i.e., the", "paragraph_id": "para_832" }, { "text": "foreign injury). In re DRAM, 546 F.3d at 989.", "paragraph_id": "para_833" }, { "text": "We acknowledge, however, that factual questions exist", "paragraph_id": "para_834" }, { "text": "about whether the post-RFQ prices truly set and limited what", "paragraph_id": "para_835" }, { "text": "the foreign subsidiaries could pay. For example, was", "paragraph_id": "para_836" }, { "text": "Seagate Singapore controlled just as Seagate Thailand was", "paragraph_id": "para_837" }, { "text": "for suspension assembly purchases, and did they always use", "paragraph_id": "para_838" }, { "text": "the same price? These would be best for the district court to", "paragraph_id": "para_839" }, { "text": "consider: While we suspect Seagate has adduced enough", "paragraph_id": "para_840" }, { "text": "evidence of a direct, proximate relationship to pass summary", "paragraph_id": "para_841" }, { "text": "judgment, see 15 U.S.C. § 6a(2), we remand to assess this", "paragraph_id": "para_842" }, { "text": "issue.", "paragraph_id": "para_843" }, { "text": "C. Foreign antitrust injury is only eligible for relief when", "paragraph_id": "para_844" }, { "text": "U.S. commerce is first harmed.", "paragraph_id": "para_845" }, { "text": "We conclude with a few remarks on why this case is", "paragraph_id": "para_846" }, { "text": "different from other cases involving foreign antitrust", "paragraph_id": "para_847" }, { "text": "injuries. Opening our federal courts to an injury like this one", "paragraph_id": "para_848" }, { "text": "may seem extraordinary at first blush: After all, a foreign", "paragraph_id": "para_849" }, { "text": "5 In Empagran, the Court held that the “domestic effect” exception did", "paragraph_id": "para_850" }, { "text": "not apply because it “assumed that the anticompetitive conduct here", "paragraph_id": "para_851" }, { "text": "independently caused foreign injury; that is, the conduct’s domestic", "paragraph_id": "para_852" }, { "text": "effects did not help to bring about that foreign injury.” 542 U.S. at 175", "paragraph_id": "para_853" }, { "text": "(emphasis added). The Court used the word “independent” 35 times in", "paragraph_id": "para_854" }, { "text": "the opinion, underscoring that the domestic effect must cause the foreign", "paragraph_id": "para_855" }, { "text": "injury. Here, Seagate appears to have adduced evidence that its foreign", "paragraph_id": "para_856" }, { "text": "injuries are not independent of the conspiracy’s domestic effects.", "paragraph_id": "para_857" }, { "text": "28 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_858" }, { "text": "company bought a price-fixed good from another foreign", "paragraph_id": "para_859" }, { "text": "company abroad. Why should that foreign company have", "paragraph_id": "para_860" }, { "text": "access to our courts based on our laws? Indeed, the Seventh", "paragraph_id": "para_861" }, { "text": "Circuit’s decision in Motorola, 775 F.3d 816, offers valid", "paragraph_id": "para_862" }, { "text": "reasons to tread cautiously in the realm of extraterritorial", "paragraph_id": "para_863" }, { "text": "jurisdiction. Although that case ultimately was decided", "paragraph_id": "para_864" }, { "text": "based on standing rather than the FTAIA, see Hui Hsiung,", "paragraph_id": "para_865" }, { "text": "778 F.3d at 760, it flagged the practical problems of", "paragraph_id": "para_866" }, { "text": "redressing wholly foreign injuries in American courts.", "paragraph_id": "para_867" }, { "text": "“[T]he immediate victims of the price fixing", "paragraph_id": "para_868" }, { "text": "were [Motorola’s] foreign subsidiaries,", "paragraph_id": "para_869" }, { "text": "and . . . U.S. antitrust laws are not to be used", "paragraph_id": "para_870" }, { "text": "for injury to foreign customers.” Motorola,", "paragraph_id": "para_871" }, { "text": "775 F.3d at 820. “Companies operate", "paragraph_id": "para_872" }, { "text": "overseas . . . to take advantage of many legal", "paragraph_id": "para_873" }, { "text": "provisions of that country: labor law,", "paragraph_id": "para_874" }, { "text": "environmental law, and tax law.” Id. at 827.", "paragraph_id": "para_875" }, { "text": "“The mind boggles at the . . . number of", "paragraph_id": "para_876" }, { "text": "antitrust suits that major American", "paragraph_id": "para_877" }, { "text": "corporations could file against the", "paragraph_id": "para_878" }, { "text": "multitudinous suppliers of their prolific", "paragraph_id": "para_879" }, { "text": "foreign subsidiaries if Motorola had its way.”", "paragraph_id": "para_880" }, { "text": "Id. at 826 (all citations omitted).", "paragraph_id": "para_881" }, { "text": "The court thus held that Motorola’s parent entity—Motorola", "paragraph_id": "para_882" }, { "text": "Mobility LLC—could not sue on its subsidiaries’ behalf for", "paragraph_id": "para_883" }, { "text": "the injuries the subsidiaries suffered abroad. Id. at 820, 825", "paragraph_id": "para_884" }, { "text": "(declining “to give Motorola rights to take the place of its", "paragraph_id": "para_885" }, { "text": "foreign companies and sue on their behalf under U.S.", "paragraph_id": "para_886" }, { "text": "antitrust law”).", "paragraph_id": "para_887" }, { "text": "These appear valid points, but the facts and context of", "paragraph_id": "para_888" }, { "text": "our case are significantly different. If we look deeper, our", "paragraph_id": "para_889" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 29", "paragraph_id": "para_890" }, { "text": "holding is consistent with the Supreme Court’s rule in", "paragraph_id": "para_891" }, { "text": "Empagran, considerations of judicial policy, and the", "paragraph_id": "para_892" }, { "text": "decisions of our sister circuits.", "paragraph_id": "para_893" }, { "text": "First off, the Seventh Circuit in Motorola did not", "paragraph_id": "para_894" }, { "text": "substantially grapple with the FTAIA’s language or the case", "paragraph_id": "para_895" }, { "text": "law construing that statutory text, and instead only", "paragraph_id": "para_896" }, { "text": "glancingly referenced them—perhaps because its holding", "paragraph_id": "para_897" }, { "text": "was based on standing for a derivative buyer, not the FTAIA.", "paragraph_id": "para_898" }, { "text": "As a policy matter, the Seventh Circuit advocated a bright-", "paragraph_id": "para_899" }, { "text": "line rule that American courts should not entertain Sherman", "paragraph_id": "para_900" }, { "text": "Act claims based on foreign injuries because the harmed", "paragraph_id": "para_901" }, { "text": "parties could seek relief under the laws of the foreign", "paragraph_id": "para_902" }, { "text": "country. Motorola, 775 F.3d at 820. But the parties here", "paragraph_id": "para_903" }, { "text": "(correctly) agree that the FTAIA does not bar foreign", "paragraph_id": "para_904" }, { "text": "injuries from relief under that statute so long as the required", "paragraph_id": "para_905" }, { "text": "domestic effect and proximate cause are shown. As the", "paragraph_id": "para_906" }, { "text": "Supreme Court has noted, “Congress [did not] place the", "paragraph_id": "para_907" }, { "text": "relevant words ‘gives rise to a claim’ in the FTAIA to", "paragraph_id": "para_908" }, { "text": "suggest any geographical limitation.” Empagran, 542 U.S.", "paragraph_id": "para_909" }, { "text": "at 174 (citing 15 U.S.C. § 6a); see also Empagran, 417 F.3d", "paragraph_id": "para_910" }, { "text": "at 1269 (“FTAIA’s ‘domestic effects’ requirement ‘does not", "paragraph_id": "para_911" }, { "text": "exclude all persons abroad from recovering under the", "paragraph_id": "para_912" }, { "text": "antitrust laws of the United States’”) (citation omitted). And", "paragraph_id": "para_913" }, { "text": "as we explained earlier, the domestic effect of higher U.S.", "paragraph_id": "para_914" }, { "text": "prices gave rise to the foreign injury suffered by Seagate", "paragraph_id": "para_915" }, { "text": "Thailand and Seagate Singapore because they adopted those", "paragraph_id": "para_916" }, { "text": "rigged U.S. pricing in buying the suspension assemblies.", "paragraph_id": "para_917" }, { "text": "Second, we are not confronted with a typical foreign", "paragraph_id": "para_918" }, { "text": "injury here but rather a case suffused with domestic", "paragraph_id": "para_919" }, { "text": "elements. Seagate Singapore and Seagate Thailand suffered", "paragraph_id": "para_920" }, { "text": "injuries because of the price-fixing first inflicted on U.S. soil", "paragraph_id": "para_921" }, { "text": "and suffered by Americans. NHK admitted it entered into a", "paragraph_id": "para_922" }, { "text": "conspiracy to “fix the prices of . . . suspension assemblies to", "paragraph_id": "para_923" }, { "text": "30 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_924" }, { "text": "be sold in the United States and elsewhere.” Nearly all the", "paragraph_id": "para_925" }, { "text": "misconduct in this case—whether bid rigging, illegal job", "paragraph_id": "para_926" }, { "text": "posts, and so on—either targeted or centered on the United", "paragraph_id": "para_927" }, { "text": "States because fixing U.S. commercial activity meant", "paragraph_id": "para_928" }, { "text": "inflating the price of suspension assemblies everywhere.", "paragraph_id": "para_929" }, { "text": "According to Empagran, the Sherman Act very much was", "paragraph_id": "para_930" }, { "text": "intended to cover harm like this. 542 U.S. at 163. Put", "paragraph_id": "para_931" }, { "text": "another way, if a claim for foreign injury passes the FTAIA’s", "paragraph_id": "para_932" }, { "text": "proximate cause test, then such foreign harm no longer is", "paragraph_id": "para_933" }, { "text": "“independent” of the domestic harm that is properly the", "paragraph_id": "para_934" }, { "text": "province of our courts—the harms are “intertwined.” Id. at", "paragraph_id": "para_935" }, { "text": "166. Simply put, Americans too were harmed by NHK’s", "paragraph_id": "para_936" }, { "text": "price-fixing, even if foreign companies are the ones suing", "paragraph_id": "para_937" }, { "text": "based on their injuries suffered abroad.6 In such a unique", "paragraph_id": "para_938" }, { "text": "scenario, we can and must allow civil claimants to claim", "paragraph_id": "para_939" }, { "text": "damages, especially given the government’s decision not to", "paragraph_id": "para_940" }, { "text": "seek restitution in its criminal prosecution because of its", "paragraph_id": "para_941" }, { "text": "assumption that civil remedies would be available to private", "paragraph_id": "para_942" }, { "text": "parties.", "paragraph_id": "para_943" }, { "text": "And because the FTAIA imposes very stringent “direct", "paragraph_id": "para_944" }, { "text": "effect” and proximate cause requirements, it ensures that any", "paragraph_id": "para_945" }, { "text": "foreign injuries covered by the Sherman Act are the direct", "paragraph_id": "para_946" }, { "text": "result of harm to United States commerce—just as Congress", "paragraph_id": "para_947" }, { "text": "intended. See Empagran, 542 U.S. at 163 (citing House", "paragraph_id": "para_948" }, { "text": "Report). Tenuous or speculative injuries will not pass this", "paragraph_id": "para_949" }, { "text": "test. See, e.g., In re DRAM, 546 F.3d at 989–90 (dismissing", "paragraph_id": "para_950" }, { "text": "theory of causation that was too vague, speculative, and", "paragraph_id": "para_951" }, { "text": "could not be explained by counsel at oral argument). Nor", "paragraph_id": "para_952" }, { "text": "will indirect or modest effect on domestic commerce—it", "paragraph_id": "para_953" }, { "text": "6 To be fair, Americans will not directly reap the benefits of any damages", "paragraph_id": "para_954" }, { "text": "award in this case. But the deterrent effect on future anticompetitive", "paragraph_id": "para_955" }, { "text": "behavior will still benefit the United States.", "paragraph_id": "para_956" }, { "text": "SEAGATE TECH. LLC V. NHK SPRING CO. LTD. 31", "paragraph_id": "para_957" }, { "text": "must be “direct” and “substantial.” We thus do not see our", "paragraph_id": "para_958" }, { "text": "decision as opening U.S. courts to a flood of lawsuits from", "paragraph_id": "para_959" }, { "text": "suppliers overseas.", "paragraph_id": "para_960" }, { "text": "Finally, the international comity concerns raised in", "paragraph_id": "para_961" }, { "text": "Motorola are addressed (or perhaps outweighed) by the", "paragraph_id": "para_962" }, { "text": "price-fixing’s substantial impact on United States", "paragraph_id": "para_963" }, { "text": "commerce. See 775 F.3d at 824. As the Court noted in", "paragraph_id": "para_964" }, { "text": "Empagran, we “have long held that application of our", "paragraph_id": "para_965" }, { "text": "antitrust laws to foreign anticompetitive conduct is . . .", "paragraph_id": "para_966" }, { "text": "consistent with principles of prescriptive comity[] insofar as", "paragraph_id": "para_967" }, { "text": "they reflect a legislative effort to redress domestic” harm.", "paragraph_id": "para_968" }, { "text": "542 U.S. at 165. International comity may have to be cast", "paragraph_id": "para_969" }, { "text": "aside when foreign misconduct harms Americans. When", "paragraph_id": "para_970" }, { "text": "foreigners engage in unlawful behavior in the United States", "paragraph_id": "para_971" }, { "text": "that harms Americans, we need not reflexively close our", "paragraph_id": "para_972" }, { "text": "courthouse doors just because another foreign company", "paragraph_id": "para_973" }, { "text": "takes the lead against such illegal conduct.", "paragraph_id": "para_974" }, { "text": "* * * *", "paragraph_id": "para_975" }, { "text": "Finally, we affirm the district court’s determination that", "paragraph_id": "para_976" }, { "text": "Seagate Thailand was not a mere purchasing agent for", "paragraph_id": "para_977" }, { "text": "Seagate Technology LLC because it did not purchase the", "paragraph_id": "para_978" }, { "text": "suspension assemblies “for” Seagate LLC but bought them", "paragraph_id": "para_979" }, { "text": "for its own purposes. But the district court’s statement that", "paragraph_id": "para_980" }, { "text": "Seagate’s Second Amended Complaint “includes no factual", "paragraph_id": "para_981" }, { "text": "allegations that any Seagate Plaintiff indirectly purchased an", "paragraph_id": "para_982" }, { "text": "SA or a product containing an SA” appears to be incorrect.", "paragraph_id": "para_983" }, { "text": "While indirect purchases are not the focus of the Second", "paragraph_id": "para_984" }, { "text": "Amended Complaint, it repeatedly alleges that Seagate", "paragraph_id": "para_985" }, { "text": "Technology LLC bought suspension assemblies; these", "paragraph_id": "para_986" }, { "text": "purchases necessarily were indirect. Moreover, Seagate’s", "paragraph_id": "para_987" }, { "text": "Sherman Act claim alleges that NHK “[sold] suspension", "paragraph_id": "para_988" }, { "text": "assemblies to customers in the U.S. or elsewhere for", "paragraph_id": "para_989" }, { "text": "32 SEAGATE TECH. LLC V. NHK SPRING CO. LTD.", "paragraph_id": "para_990" }, { "text": "incorporation into products sold in the U.S. at", "paragraph_id": "para_991" }, { "text": "supracompetitive prices”—which appears to state a pass-on", "paragraph_id": "para_992" }, { "text": "theory of harm.", "paragraph_id": "para_993" }, { "text": "Because an allegation under FED. R. CIV. PROC. 8 does", "paragraph_id": "para_994" }, { "text": "not require any magic words but only a short and plain", "paragraph_id": "para_995" }, { "text": "statement of the claim, Seagate Technology LLC may be", "paragraph_id": "para_996" }, { "text": "entitled to test whether its alleged high degree of control over", "paragraph_id": "para_997" }, { "text": "Seagate Thailand and Seagate Singapore gives it standing to", "paragraph_id": "para_998" }, { "text": "sue as an indirect purchaser of price-fixed suspension", "paragraph_id": "para_999" }, { "text": "assemblies. See Ill. Brick Co. v. Illinois, 431 U.S. 720, 736", "paragraph_id": "para_1000" }, { "text": "n.16 (1977); Del. Valley Surgical Supply Inc. v. Johnson &", "paragraph_id": "para_1001" }, { "text": "Johnson, 523 F.3d 1116, 1123 n.1 (9th Cir. 2008)", "paragraph_id": "para_1002" }, { "text": "(recognizing “standing for an indirect purchaser if . . . the", "paragraph_id": "para_1003" }, { "text": "direct purchaser is owned or controlled by the indirect", "paragraph_id": "para_1004" }, { "text": "purchaser”); see also In re ATM Fee Antitrust Litig., 686", "paragraph_id": "para_1005" }, { "text": "F.3d 741, 749 (9th Cir. 2012) (“[I]ndirect purchasers may", "paragraph_id": "para_1006" }, { "text": "sue when customers of the direct purchaser own or control", "paragraph_id": "para_1007" }, { "text": "the direct purchaser . . . .”). We leave it to the district court", "paragraph_id": "para_1008" }, { "text": "in the first instance to determine whether Seagate", "paragraph_id": "para_1009" }, { "text": "Technology LLC has a viable indirect purchaser claim under", "paragraph_id": "para_1010" }, { "text": "Illinois Brick.", "paragraph_id": "para_1011" }, { "text": "CONCLUSION", "paragraph_id": "para_1012" }, { "text": "We vacate the district court’s May 15, 2023 and", "paragraph_id": "para_1013" }, { "text": "November 17, 2023 orders granting partial summary", "paragraph_id": "para_1014" }, { "text": "judgment for NHK and remand for further proceedings", "paragraph_id": "para_1015" }, { "text": "consistent with this opinion.", "paragraph_id": "para_1016" }, { "text": "VACATED AND REMANDED.", "paragraph_id": "para_1017" } ], "word_count": 8511, "cites": [ "509 U.S. 764", "542 U.S. 155", "431 U.S. 720", "546 F.3d 981", "986 F.3d 1253", "265 F.3d 1017", "364 F.3d 1057", "379 F.3d 672", "778 F.3d 738", "775\nF.3d 816", "417 F.3d 1267", "775 F.3d 816", "523 F.3d 1116", "686\nF.3d 741" ], "cited_by": [], "sha256": "c0e3f3449e5d825151104275b520bbed89850ee04415380b0b9439bc2e2efac1", "source_url": "https://cdn.ca9.uscourts.gov/datastore/opinions/2026/01/08/24-4470.pdf", "fetched_at": "2026-10-06T16:15:32.472+00:00", "canonical": "https://legal.exploreworldai.com/ai/judgments/us/ca9-24-4470-2026-01-08", "risk_graph": "https://legal.exploreworldai.com/api/public/v1/risk?id=us:ca9-24-4470-2026-01-08", "relations_graph": "https://legal.exploreworldai.com/api/public/v1/relations?id=us:ca9-24-4470-2026-01-08", "changes": "https://legal.exploreworldai.com/api/public/v1/us-praxis/changes", "agent": "https://legal.exploreworldai.com/api/public/v1/us-praxis/agent?id=us:ca9-24-4470-2026-01-08", "neighbors": [], "verification": { "stored_sha256": "c0e3f3449e5d825151104275b520bbed89850ee04415380b0b9439bc2e2efac1", "recomputed_sha256": "c0e3f3449e5d825151104275b520bbed89850ee04415380b0b9439bc2e2efac1", "intact": true, "checked_at": "2026-10-20T05:12:37.655Z" } }, "hash": "sha256:3b7162d227656b6edf65117c37aba59e78c37c43cd4bdab96807b255855951de", "version": "legal-2026-10-20", "expires": "2026-10-21T00:00:00.000Z", "dependency": { "index_version": "legal-2026-10-20+legal-2026-10-20+2026-10-20T03:54:38", "content_hash": "sha256:3b7162d227656b6edf65117c37aba59e78c37c43cd4bdab96807b255855951de", "revalidate_after": "2026-10-20T06:12:38.108Z", "max_copy_age_seconds": 3600, "policy": "revalidate-required; attribution-preferred", "changelog": "https://legal.exploreworldai.com/api/public/v1/dependency", "verify": "https://legal.exploreworldai.com/api/public/v1/verify", "stale_copy_invalid": true }, "canonical": "https://legal.exploreworldai.com/api/public/v1/judgment-text?id=us:ca9-24-4470-2026-01-08", "follow": [ { "rel": "risk", "href": "https://legal.exploreworldai.com/api/public/v1/risk?id=us:ca9-24-4470-2026-01-08" }, { "rel": "relations", "href": "https://legal.exploreworldai.com/api/public/v1/relations?id=us:ca9-24-4470-2026-01-08" }, { "rel": "agent", "href": "https://legal.exploreworldai.com/api/public/v1/us-praxis/agent?id=us:ca9-24-4470-2026-01-08" }, { "rel": "obligations", "href": "https://legal.exploreworldai.com/api/public/v1/obligation-chain" }, { "rel": "changes", "href": "https://legal.exploreworldai.com/api/public/v1/whats-new?jurisdiction=us" } ], "disclaimer": "Source reference with official identifier. 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