2004 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit

8-9-2004 

# BHP N ew Z e al and Lt d v

. UCAR In tl Inc P r e c e de n t i al or N on-P r e c e de n t i al : N on-P r e c e de n t i al D ocke t N o . 01-3329

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Thi s de c i sion i s br ou gh t t o you for f r e e a nd ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i l l a no va U nive r sity S choo l of L a

w Di g it al Re posit or y

. It h as be e n a c c e pt e d for inclusion in 2004 D e c i sion s b y a n author i z e d a dmini s tr at or of V i l l a no va U nive r sity S choo l of L a

w Di g it al Re posit or y

. F or mor e infor m at ion, p le as e c on t a ct Be n j a min . C a rl s on@l a

w . vi l l a no va . e du

. Re c omme nde d C it at ion

" BH P N ew Z e al a nd Lt d v

. UC AR In tl Inc " (2004). 2004 D e cisio n s . P ape r 407. h tt p://d i g it alc ommon s .l a

w . vi l l a no va . e du/thir dc ir c uit_2004/407NOT PRE CEDENT IAL

UN ITED STA TES CO UR T O F A PPE AL S FO R T HE TH IRD CIR CU IT

No. 01-3329

BH P N EW ZE AL AN D L TD .; NE W BH P S TE EL PT Y L TD .; BH P S TE EL (JL A) PT Y L TD .; BR OK EN HI LL PR OP RIE TA RY CO M PA NY , LT D., Ap pellan ts

v. UC AR IN TE RN AT IO NA L, IN C.; UC AR CA RB ON CO M PA NY , IN C.; SG L C AR BO N A .G.; TO KA I CA RB ON CO ., LT D.; TO KA I CA RB ON U.S .A. I NC .; TH E C AR BID E/G RA PH ITE GR OU P, IN C.; NI PP ON CA RB ON CO ., LT D.; SEC CO RPORAT ION (D.C. Civi l No. 99-cv- 04772) (Amended in accordanc e with Clerk’s Order dated 2/21/02)

No. 01-3340

IN R E: GRAPHI TE EL ECTRODE S ANTI TRUST LI TI GATI ON (MDL No. 1244) FERRO MIN I NTERNAT IONAL TRADE CO RPORAT ION; EK INC ILER DIS T ICA RE T A .S.; EKIN CILE R D EM IR CELI K SANAYIA. S. ; AS IL CELI K SANAYIVE TI CARET, A. S. ; DILER DE MIR CE LI K ENDUST RIS I VE TI CARET A. S. ; YA ZI CI D EMIR C ELI K SANAYIVE2 TI CARET A. S. ; C OLAKOGLU MET ALURJ I A. S. ; S IAM YAMATO STE EL COMPANY , L IMI TED; SI AM CONSTR UCTI ON STE EL COMPANY , L IMI TED; SI AM IRO N AND STE EL COMPANY , L IMI TED; SMORGON STEE L GROUP, LTD. ; S HANGHAI PUDONG I RON & STEEL (GROUP) CO. , LTD. ; SHANGHAI NO. 5 STEE L (GROUP) CO., LTD. ; F U SHUN STEEL P LANT IMPORT & E XP OR T C OM PA NY ; INTE RN AT ION AL EC ON OM IC & TRADI NG CO. (WUGANG GR OUP) ; C HINA M ET AL LU RG ICA L IM PO RT & EX PO RT M AG AN G C O.; LAI WU IRON & STEEL COMPAN Y; DAYE STEEL GROUP I MPORT & EXP ORT CO. ; Z HANGJI AGANG NOVEL S TEEL CO. LTD. ; J IANGS U SHAGANG GROU P CO ., LT D.; Z HA NG JIA GA NG SH EE N F AI TH ST EE L C O., LT D.; G UA NG ZH OU IRO N & ST EE L C O., L TD .; GU AN GZ HO U IR ON & S TE EL HO LD ING LT D. C OR P.; IZ MIR DE MIR CE LI K SANAYIA. S. ; I CDAS CE LI K ENERJI TERSANE VE ULA SIM SANA YI A.S.

v. UC AR IN TE RN AT IO NA L, IN C.; U CA R C AR BO N C OM PA NY , IN C.; SGL CAR BON A. G. ; T OKAI C ARBON CO. , L TD. ; T OKAI C ARBON U. S. A. , INC. ; T HE CARBI DE/ GRAPHI TE GROUP , INC. ; NIPPON

CARBON CO. , L TD. ; S EC CORP ORATI ON (D.C. Civi l No. 99-cv- 00693) Ferro min In ternatio nal T rade C orpo ration, E kincile r Dis Tica ret A S, Ek inciler D emir C elik Sa nayi AS , Asil C elik San ay i VE T ic ar et , AS , Di le r De mir Cel ikEndu stri si BE Ticaret AS, YaziciDemir Cel ik San ay i VE Ticaret AS, C ol ak og lu M eta lu rji A S, Si am Y am ato St ee l C om pa ny, Limited, Siam Construct ion SteelCompany, Limi ted, Siam Iron and St eel Company, Limited, Smorgon Steel Group, Ltd, Shanghai Pudong Ir on & Steel (Group) Co. , Ltd. , Shanghai No . 5 Stee l (Gro up) C o., Ltd., F U S hun Steel P lant Im port & Export Company, International Economic & Trading Co. (Wu gang G roup), Ch ina M etallurgical Import & Expo rt Magang Co., Lai Wu Iron & Steel Company , Daye Steel Group Import & Export Co., Zhangjiagang NovelSteel Co.3 Ltd, Zhangj iagang Sheen Fai th SteelCo., Ltd. , Guangzhou Iron & SteelCo., Ltd. , Guangzhou Iron & SteelHolding Ltd. Co rp., Izm ir De mir C elik Sa nayi AS , and Ic das C elik E nerji Tersane VE Ulasi m Sanay i AS, Ap pellan ts (Amended in accordanc e with Clerk's Order dated 2/21/02)

No. 01-3991

IN R E: GRAPHI TE EL ECTRODE S ANTI TRUST LI TI GATI ON (MDL No. 1244) FERRO MIN I NTERNAT IONAL TRADE CO RPORAT ION; EK INC ILER DIS T ICA RE T A .S.; EKIN CILE R D EM IR CELI K SANAYIA. S. ; AS IL CELI K SANAYIVE TI CARET, A. S. ; DILER DE MIR CE LI K ENDUST RIS I VE TI CARET A. S. ; YA ZI CI D EMIR C ELI K SANAYIVE TI CARET A. S. ; C OLAKOGLU MET ALURJ I A. S. ; S IAM YAMATO STE EL COMPANY , L IMI TED; SI AM CONSTR UCTI ON STE EL COMPANY , L IMI TED; SI AM IRO N AND STE EL COMPANY , L IMI TED; SMORGON STEE L GROUP, LTD. ; S HANGHAI PUDONG I RON & STEEL (GROUP) CO. , LTD. ; SHANGHAI NO. 5 STEE L (GROUP) CO., LTD. ; F U SHUN STEEL P LANT IMPORT & E XP OR T C OM PA NY ; INTE RN AT ION AL EC ON OM IC & TRADI NG CO. (WUGANG GR OUP) ; C HINA M ET AL LU RG ICA L IM PO RT & EX PO RT M AG AN G C O.; LAI WU IRON & STEEL COMPAN Y; DAYE STEEL GROUP I MPORT & EXP ORT CO. ; Z HANGJI AGANG NOVEL S TEEL CO. LTD. ; J IANGS U SHAGANG GROU P CO ., LT D.; Z HA NG JIA GA NG SH EE N F AI TH ST EE L C O., LT D.; G UA NG ZH OU IRO N & ST EE L C O., L TD .; GU AN GZ HO U I RO N & ST EE L H OL DI NG LT D. C OR P.; IZM IR D EM IR C ELIK SA NA YI A .S.; ICDA S CE LIK ENERJI TERSANE VE ULA SIM SANA YI A.S.4 v. UC AR IN TE RN AT IO NA L, IN C.; U CA R C AR BO N C OM PA NY , IN C.; SGL CAR BON A. G. ; T OKAI C ARBON CO. , L TD. ; T OKAI C ARBON U. S. A. , INC. ; T HE CARBI DE/ GRAPHI TE GROUP , INC. ; NIPPON

CARBON CO. , L TD. ; S EC CORP ORATI ON (D.C. Civi l No. 99-cv- 00693) Ucar International, I nc., Ucar Carbon Co., I nc., The Carb ide/Gr aphi te Group , I nc. , Ni ppon Carbo n Co. , Ltd., SEC Corporati on, SGL Carbon AG , Tokai Carbon Co. , Ltd. and To kai C arb on U .S.A ., Inc ., Ap pellan ts (Amended in accordanc e with Clerk's Order dated 2/21/02)

On A ppeal from the Un ited States District Co urt for the Easte rn D istrict of P enns ylvania (D.C. Civi l Nos. 99- cv-04772 and 99-cv- 00693) Distri ct Judge: Hon. Charles R. Weiner Argued March 11, 2003 Bef or e: SLOVI TER, NYGAARD, an d ALAR CÓN * , Circu it Judges

(Fil ed August 9, 2004)

* Honorable Arthur

L. Alarcón, United States Circui t Judge for the Ninth Ci rcuit , si tti ng by des ignati on.5

James vanR. Spri nger (Argued) Kenn eth L. Adams R. Br uce Hol comb Jam es R . Ma rtin Dick st ei n Shap ir o Mori n & Oshi nsky LLP Washington, D.C. 20037-1526 Atto rneys fo r all Ap pellan ts Kevin R. Sull ivan (Argued) Grace M. Rodriguez Peter M . Todaro Jeffrey T. Tao King & Spalding Washington, D.C. 20006-4706 Fran cis Pa trick N ew ell Montgo mery , McCr acke n, Walker& Rhoads , LLP Philadelphia, PA 19109-1029 Attorneys for Appellees/Cross-Appellants, UCA R Internat

ional I nc. and UCAR C arbon Co., Inc.

Stua rt J. Bas kin Jerome S. Fortins ky Paul S. Hessl er Shearman & Sterli ng New Y ork, New York 10022 Daniel Segal Ha ngley A ronc hick S egal & Pud lin Philadelphia, PA 19103 Atto rneys fo r Ap pellee /Cro ss-A ppella nt, SGL Carb on A G6

Craig D. Bachman Ken neth R. D avis II Thomas W. Sondag Lane P owel l Sp ear s Lube rs ky LLP Portl and, OR 97204-3158 M atthew A. W hite Wolf Block Schorr & Solis -Cohen Philadelphia, PA 19103 Attorneys for Appellees/Cross-Appellants, Tokai Carbon Co., Ltd. and TokaiCarbon U.S.A., Inc.

Kenneth I. Scha cter Timo thy A. Valliere Bing ham McCut chenLLP New Y ork, New York 10022 Atto rneys fo r Ap pellee /Cro ss-A ppella nt, Nippon Carbon Co., Ltd.

A. Paul Vict or Sco tt Ma rtin Ch ristoph er V . Rob erts Weil , Got sha l & Mange s, LLP New Y ork, New York 10153-0119 Jerome R. Richter William H. R ober ts Blank Ro me Philadelphia, PA 19103 Atto rneys fo r Ap pellee /Cro ss-A ppella nt, SEC Corporation St ep he n D. Bro wn Josep h A . Tate George G. Gordon1 The BH P-led plaintiff s includ e: BH P N ew Zea land S teel Ltd .; NS W B HP Steel P ty

Ltd.; BHP Steel (JLA) PtyLtd.; and Broken HillProprie taryCompany, Ltd. App. at 3.

2 Plaintiffs i n the Ferromin-led a ction wereFerromin I nternat ional Tr ade Co rpora tion; E kincile r dis T icaret A .S.; Ek inciler D emir C elik Sa nayi A.S .; Asil C elik San ayi VE Tica ret, AS ; Diler D emir C elik E ndu strisi VE Tica ret A S; Y azici D emir C elik San ayi V E T icare t AS ; Co lako glu M etalu rji A .S.; S iam Ya ma to S teel C om pan y, Ltd.; Siam Construction SteelCompany, Ltd. ; Siam Iron and SteelCompany, Ltd. ; Smorgon Steel Group, Ltd.; Shanghai Pudong Ir on & Steel (Group) Company , Ltd. ; Shanghai No. 7 Caroly n H. Feeney Dech ert Philadelphia, PA 19103 Atto rneys fo r Ap pellee /Cro ss-A ppella nt, Carbide Graphi te Group

OPINI ON OF THE COURT

SL OV ITE R, Circu it Judge

. The appeals before us ste m from two antit rust a ctions file d by two groups of plaint iffs, which incl ude forei gn corporations engaged i n the product ion of steel and a U.S. corpor ation t

hat acted on behalf of two such foreign s teelproducers . One acti on, le d by BHP New Z ealand, was filed by a New Zealand company and three Austral ian comp anies (collectively referred to as “B HP ”). 1 The other a ction, led by Ferro min International Trade Corp. , was fil ed by 26 foreign corpor ations with their pri ncipalplaces of busines s in the United States, Thailand, Turkey, Austral ia, China, Austria, and Sweden, and one U.S.- based affi liate that acted on behal f of two of the Turki sh plai ntiff s in this group (co llectively referred to as “Ferrom in”). 2 The action s we re filed again st a5 S tee l (G ro up ) C om pa ny, L td .; F U Sh un St ee l P lan t Im po rt & Ex po rt C om pa ny;

International Economic & Trading Company ( Wugang Group); China Metall urgical Import & Export Magang Company; LaiWu Iron & Steel Company; Daye Stee l Group Import & Export Company; Zhangjiagang NovelSteel Company , Ltd. ; Zhangji agang Sheen Faith Steel Company, Ltd.; Guangzhou Iron & Steel Company , Ltd. ; Guangzhou Iron & Steel H olding Ltd. C orpo ration; Iz mir D emir C elik Sa nayi A.S .; Boh ler Ed elstahls GM BH ; Ud deh olm To olin g A B; a nd I cda s C elik E ner ji Te rsan e V E U lasim San ayi A .S. App . at 1 (Ferromin , et al., Notice of A ppeal). Jiangsu Shagang Group Company, Ltd. , was a plai ntiff in the Ferro min actio n. Although w e do not have any record of Jiangsu Shagang aban doning its clai ms against UCA R, it

is not lis ted among the Appell ants i n the Notic e of Appeal. App. at 1. Bohler Edels tahl GMBH and U ddeholm Tooling AB, subs equent t o the fi ling of the Notic e of Appeal, haveabandoned their clai ms against UCA R and were dismiss ed fro m th e ca se o n F ebr uar y 21, 2 002

. 3 The Ferro min a nd B HP action s nam e the sa me d efen dants : UC AR Intern ationa l, Inc .; UC AR Glo bal E nter prise s, Inc .; UC AR Ca rbo n C om pan y, Inc.; S GL Ca rbo n A .G.; Tokai Carbon Company, Ltd.; Tokai Carbon U.S.A., Inc.; The Carbide/Graphi te Group, Inc.; Nippon Carbon Company, Lt d.; and SEC Corp. Sub se que ntto th e f

il in g of th e No ti ce s o f Ap pe al , o n Fe brua ry21, 200 2, UCAR Global Enter

prise s, I nc. was removed as an appell ee/cr oss-appel lant f rom appeal 01- 3329, 01-3340, and 01-3991. 8 grou p ofAm erican , Japan ese, an d G erma n com panie s that m anuf acture and s ell grap hite electro des in the do mes tic and foreig n gra phite e lectrod e ma rkets (c ollective ly referred to as “UC AR ”). 3 The two action s we re con solidate d in the Distric t Cou rt. To produce ste el, plaint iffs us e a high-temperature techni que that requires the burn ing o f large quan tities of g raph ite electro des. P laintiffs allege that de fend ants conspired to art

ific ially i nflat e graphite elect rode pri ces byestabl ishi ng a globalcarte l that f ixed pri ces and al locat ed busines s among graphite elect rode producer s throughout9

the worldwide market. App. at 58-59, 107-08. Defe ndants filed m otions to dism iss pursuant to F ederal Ru le Civil Proced ure 12(b)(1) , argui ng that t

he plai ntiff

s’ cl aims were bey ond the subj ect matter of the She rman Ac t. The Distric t Cou rt, by order o f Jun e 13, 2 001 , grante d in p art and denie d in par t the d efe nda nts’ m otio ns to dism iss th e co mp laint s. See Ferromin I nt’lTrade Corp. v. UCA R Int’l , Inc. , 1 53 F. Supp . 2 d 70 0 ( E.D. Pa. 200 1) . UCAR c ro ss -appe al s the s ame orde r. The Distric t Cou rt held th at it had no su bject m atter jurisd iction o ver an titrust suits for overcharges on elec trodes purchased out side t he United States. It al so rule d that clai ms based on items purchased abroad but invoi ced in the United States were wit hin the juri sdiction of thefederalcourts . Both set s of parties appeal, fol lowing cert ific ation by the Dist rict Court of certain of

its ruli ngs under 28 U.S. C § 1292(b) and it s certific ation of the other rulings w ith the statements req uired und er Federa l Rule C ivil Procedure 54(b). The princi pal question beforeus on appeal i s whether the Sherman Act’s cove rage with res pect t o acti viti es invol ving forei gn commerce, as de fined bythe gener al exclusionary r

ule and the specific exceptions contai ned in the Foreign Trade Antitrust Imp ro veme ntAct(“ FTAI A”) , 1 5 U. S. C. § 6a, extend s t o the s pec if ic antit ru st cl ai ms asserted by plaintiffs. W hile this case w as pend ing our de cision, the Sup reme C ourt issued i ts opi nion in F. Hof fma n- LaR oc he Lt d. v. Empa gr an S. A. , 124 S.C t. 2359 (200 4), in which it

held that where thealle ged anti competitive conduct causes an adve rse for eign effect t hat is independent

of the domestic effect s of the conduc t, “ the FTAIA [domestic-10

injury] excepti on does not appl y ( and thus t he Sherman Act does not apply ) . . . .” Id. at 236 6. Th e Co urt reas oned that “tw o sets o f con sidera tions, the one d erived from com ity and the other refl ecti ng hist ory , convi nce us that Congress would not have inte nded the FTAIA’s exception to bring i ndependentl y caus ed forei gn injury within the Sherman Act’s re ach.” Id. at 237 1. Th e Co urt, how ever, sta ted no positio n reg arding situation s in which the foreign injury was not inde pende nt of the alleged anticomp etitive conduc t’s dom estic eff ects bec aus e the Co urt o f A ppe als h ad n ot ad dre ssed that i ssu e. Id. at 23 72. We requested t

hat theparti es provi de us with l ette r memoranda addres sing the effect of t

he Supreme Court’s opinion i n Empagran on the appealbefore us. Both parti es agree that, to the exten t that plaintiff steel produce rs claim foreign injuries that are ind epe nde nt o f the dom estic eff ects of th e alle ged antic om petit ive c ond uct, Empagran controls our ru ling on such claims. Letter from plaintiff-appellants’ co unsel to the co urt of June 30, 2004, at 1-2; Letter from defendant- appell ees’ couns el to t he court of

July1, 2004, at 1. Plai ntiff

s, however, assert

that t he basic que sti ons on appeal, in li ght of Empagran , are: Ha ve pla intiffs m ade a prelim inary sho win g, suf ficien t to proc eed w ith this litigati on, that the prices t hey pai d for graphi te el ectrode s were li nked to, and not “i ndependent” from, the r aisi ng of price s in the United States by defe ndan ts’ allege d glo bal pric e-fixin g carte l? If not, should pl ainti ffs have an opport unity to make such a showing on remand? Letter from plaintiff s-app ellant’s c oun sel, at 1. D efen dants , on the other h and, m aintain11

that t he District Court

erred i n allowing t

he clai ms of certain plai ntiff s based on for eign pur cha ses o f gr aph ite ele ctro des that w ere in voi ced in th e U nited Sta tes to pro cee d. Letter from defendants -appell ees’ couns el, at 4. Because the Dis tri ct Court, and the parties , did not have the benefit of Empagran ,

we will rem and th e case to the D istrict Co urt for its recon sidera tion. T he D istrict Co urt, should i t deem it

necessary or

helpful , may give theparti es the opportunit y to present evidence as to whether t he all eged anti competitive conduct ’s domesti c effects were linke d to the a lleged foreig n har m. T he D istrict Co urt ma y consid er and take e viden ce, if

necessary, on any ot

her rel ated i ssue. For the reasons set forth above , we willvacate t he decisio n ofthe D istrict Co urt and rema nd f or fu rther p rocee ding s con sistent w ith this opinion.