Opinion ID: 2013459
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Heading: Interpretation of the Iowa Competition Law

Text: Our first role is to interpret the state antitrust statute. We apply our familiar rules of statutory interpretation to the words of the statute. Our goal in interpreting the Iowa Competition Law is to give effect to the purpose and intent of the legislature. State v. Owens, 635 N.W.2d 478, 485 (Iowa 2001). In examining the words of the statute, we give words their ordinary and common meaning absent any specific legislative meaning or meaning in law. Id. at 486. If there is no ambiguity, but the plain meaning of the statute is ascertainable, our inquiry must end. State v. Welton, 300 N.W.2d 157, 160 (Iowa 1981). The state antitrust statute is clear on its face. The statute provides, [a] person who is injured ... by conduct prohibited under this chapter may bring suit. Iowa Code § 553.12. This statute does not restrict the class of persons who may bring suit under the Iowa Competition Law. Nothing in the statute says in order to seek redress for antitrust violations a purchaser must be directly injured. [5] The legislature did not specifically limit standing to direct purchasers, but instead it simply authorized [a] person who is injured to sue. Legislative intent is determined by what the legislature said, not by what it did not say or might have said. State v. Beach, 630 N.W.2d 598, 600 (Iowa 2001); see Bunker's Glass Co. v. Pilkington, plc, 47 P.3d 1119, 1128 (Ariz. Ct. App.2002). Therefore, we do not regard our legislature's failure to explicitly authorize indirect purchasers to maintain a suit for antitrust violations as an expression of its agreement with Illinois Brick. See Bunkers's Glass Co., 47 P.3d at 1128-29. Given the clear, broad language of the state antitrust law, we conclude the Iowa Competition Law creates a cause of action for all consumers, regardless of one's technical status as a direct or indirect purchaser. Despite the plain language of the statute, Microsoft argues Iowa does not have authority to allow indirect purchasers redress under our state antitrust laws because our legislature has mandated that the Iowa Competition Law shall be construed to complement federal law. Therefore, Microsoft argues, Iowa is bound by the federal law. The harmonization statute upon which Microsoft relies provides, This chapter shall be construed to complement and be harmonized with the applied laws of the United States which have the same or similar purpose as this chapter. This construction shall not be made in such a way as to constitute a delegation of state authority to the federal government, but shall be made to achieve uniform application of the state and federal laws prohibiting restraints of economic activity and monopolistic practices. Iowa Code § 553.2 (emphasis added). Given this statutory provision, the district court agreed with Microsoft and concluded interpretation of the Iowa Competition Law is bound by federal law announced in Illinois Brick. We disagree with this conclusion. We do not find Iowa Code section 553.2 requires Iowa courts to interpret the Iowa Competition Law the same way federal courts have interpreted federal law. In fact, the harmonization statute specifically states the provision shall not be made in such a way as to constitute a delegation of state authority to the federal government. This is not an issue of federal preemption of state law. This argument has been consistently rejected by the United States Supreme Court and by us today. Emergency One, Inc. v. Waterous Co., 23 F.Supp.2d 959, 967 (E.D.Wis.1998). Congress intended federal antitrust laws to supplement, not displace state antitrust remedies. Id. (citing ARC Am., 490 U.S. at 102, 109 S.Ct. at 1661, 104 L.Ed.2d at 95). Furthermore, because Illinois Brick was a decision construing only federal antitrust law, it did not define the connection, if any, between federal and state antitrust laws. The concept of federalism assumes power, and duty, of independence in interpreting our own organic law. Pool v. Superior Ct., 139 Ariz. 98, 677 P.2d 261, 271 (Ariz.1984). Given that there is no federal preemption on this issue, we must construe the Iowa Competition Law to encourage the primary goal of antitrust law. Neyens v. Roth, 326 N.W.2d 294, 297 (Iowa 1982) (antitrust laws are remedial and should be broadly construed to effect their purposes); see Bunker's Glass Co., 47 P.3d at 1124. In construing the Iowa Competition Law, we are bound by the purpose of our harmonization provision. Contrary to Microsoft's assertion, this provision is not aimed at defining who can sue under our state antitrust law. Rather, our legislature clearly announced the purpose of the harmonization statute by stating it is designed to achieve uniform application of the state and federal laws prohibiting monopolistic practices. See Iowa Code § 553.2. The purpose behind both state and federal antitrust law is to apply a uniform standard of conduct so that businesses will know what is acceptable conduct and what is not acceptable conduct. To achieve this uniformity or predictability, we are not required to define who may sue in our state courts in the same way federal courts have defined who may maintain an action in federal court. Rather, our guiding principle in interpreting the Iowa Competition Law is to do so in such way as to prohibit restraints of economic activity and monopolistic conduct. Harmonizing our construction and interpretation of state law as to what conduct is governed by the law satisfies the harmonization provision. Moreover, there is no plain inconsistency between the policies behind the Iowa Competition Law and those underlying federal antitrust law. The United States Supreme Court has held that two statutes, both of which prohibit anticompetitive conduct, are not inconsistent merely because one allows indirect purchasers to sue for damages while the other does not. Mack v. Bristol-Myers Squibb Co., 673 So.2d 100, 110 (Fla.Dist.Ct.App.1996) (citing generally ARC Am., 490 U.S. at 93, 109 S.Ct. at 1661, 104 L.Ed.2d at 86). The federal antitrust statute shows Congress' concern with the protection of competition, not competitors. State v. Cedar Rapids Bd. of Realtors, 300 N.W.2d 127, 129 (Iowa 1981) (quoting Brown Shoe Co. v. United States, 370 U.S. 294, 320, 82 S.Ct. 1502, 1521, 8 L.Ed.2d 510, 533 (1962)). The goal of federal antitrust law is to prohibit restraint of economic activity and monopolistic practices. Our state antitrust law promotes the same consumer protection policies as does federal antitrust law by assur[ing] customers the benefits of price competition. See Associated Gen. Contractors of California, Inc. v. Carpenters, 459 U.S. 519, 538, 103 S.Ct. 897, 908, 74 L.Ed.2d 723, 738 (1983). In order for us to agree with Microsoft that the harmonization statute requires us to prohibit suits by indirect consumers, we must accept the fact that real victims those who purchase goods and pay the overchargecannot recover. This result would overwhelmingly defeat the purpose of the Iowa Competition Law. Consumers in this state are best protected by permitting all injured purchasers to bring suit against those who violate our antitrust laws. As a final consideration in our interpretation of the Iowa Competition Law, we must strive to effectuate the purpose and intent of the legislature. In order to accomplish this, we examine what the current state of the law was at the time our state legislature enacted the Iowa Competition Law. The Iowa legislature passed the current Iowa Competition Law one year before the decision in Illinois Brick. Consequently, it was impossible for the legislature to have adopted a judicial construction which did not exist at that time. The legislature did not have the opportunity to discuss Illinois Brick and accept or reject its law before passing the Iowa Competition Law. See Bunker's Glass Co., 47 P.3d at 1129 (We do not consider the legislature's post-1977 silence on the issue of indirect purchaser standing as an indication that it acquiesces in the holding of Illinois Brick. ). Because Iowa took its cues from federal law in creating our state antitrust statute, the federal law in place before Illinois Brick is instructive. Prior to the court's ruling in Illinois Brick, most federal courts construed section four of the Clayton Act to allow suits by indirect purchasers. Hyde v. Abbott Labs. Inc., 123 N.C.App. 572, 473 S.E.2d 680, 685 (N.C.Ct. App.1996) (citations omitted). In fact before the Illinois Brick ruling, six of the seven federal courts of appeals that considered this issue held indirect purchasers could recover damages for antitrust violations. Cynthia Urda Kassis, The Indirect Purchaser's Right to Sue Under Section 4 of the Clayton Act: Another Congressional Response to Illinois Brick, 32 Am. U.L.Rev. 1087, 1098 (1983) (hereinafter Kassis). [6] Moreover, even the United States Supreme Court prior to Illinois Brick consistently recognized Congress' intent in enacting section four of the Clayton Act was to protect all victims of antitrust infringements. Id. When the Iowa legislature enacted the Iowa Competition Law, it did so considering the federal law prior to Illinois Brick which allowed indirect purchasers to bring antitrust suits. To the extent we consider relevant federal precedent on this subject as persuasive, we find the status of federal law before Illinois Brick supports our conclusion that the Iowa legislature intended indirect purchasers to have standing under the Iowa Competition Law. See Neyens, 326 N.W.2d at 297 (in construing the Iowa Competition Law, federal cases are of some help and we must consider them). Microsoft relies much on other recent state court rulings on this issue. A number of these state courts have decided not to permit indirect purchasers to sue in state court. See Vacco v. Microsoft Corp., 260 Conn. 59, 793 A.2d 1048 (Conn.2002); Berghausen v. Microsoft Corp., 765 N.E.2d 592 (Ind.Ct.App.2002); Arnold v. Microsoft Corp., No. 2000-CA-002144-MR, 2001 WL 1835377 (Ky.Ct.App. Nov.21, 2001); Davidson v. Microsoft Corp., 143 Md.App. 43, 792 A.2d 336 (Md.Ct.App.2002); Siena v. Microsoft Corp., No. C.A. 00-1647, 2000 WL 1274001 (R.I.Super.Ct. Aug. 21, 2000). On the other hand, in the wake of the Illinois Brick decision, many other states passed legislation insuring indirect purchasers would continue to have a remedy under state law. In total, nineteen states, the District of Columbia, and Puerto Rico have statutes explicitly authorizing indirect purchasers to maintain an antitrust suit. [7] Seventeen other states permit recovery on behalf of consumers, either in the form of restitution or damages under state consumer protection laws or state unfair trade practices statutes. Kevin J. O'Connor, Is the Illinois Brick Wall Crumbling? 15 Antitrust 34, 34-35 (2001) (hereinafter O'Connor). [8] In total, thirty-six states and the District of Columbia recognize a cause of action for indirect purchasers. Id. Additionally, another four states allow the state attorney general to initiate a lawsuit on behalf of the government or natural persons. Id. [9] Though interesting, what a few other states have chosen to do with their various antitrust laws is not determinative of what is permitted under Iowa state antitrust law. The fact that some other state courts have chosen to bar antitrust suits by indirect purchasers does not deter us from interpreting the Iowa Competition Law consistently with legislative intent and policies behind our antitrust law. Moreover, the fact that thirty-six jurisdictions allow antitrust suits by indirect purchasers militates against Microsoft. This certainly shows a trend, even if by statute, to allow any injured person to maintain a suit. In Iowa, without express legislative comment to the contrary, it is appropriate to interpret the Iowa Competition Law in conformity with this trend. In sum, based on the words of the statute, we conclude the Iowa antitrust law is not bound by the federal antitrust law announced in Illinois Brick.