In Minn-Chem Inc. et al. v. Agrium Inc. et al., the Seventh Circuit reversed a panel decision dismissing a suit against potash producers allegedly involved in a cartel. The en banc panel found that, under the Foreign Trade Antitrust Improvements Act (FTAIA), there was a sufficient connection between the alleged plot involving foreign producers and the impact on the U.S. potash market.
Overruling circuit precedent, and citing the Supreme Court’s 2010 decision in Morrison v. National Australia, the en banc court held that the FTAIA’s limits on cases involving foreign conduct relate to the merits of the claim and are NOT jurisdictional. The court held that this interpretation was necessary to meaningfully check foreign cartels. Foreign countries, the court commented, “would logically be pleased to reap economic rents from other countries” and thus would have little incentive to prosecute cartels. “It is the U.S. authorities or private plaintiffs,” the court explained, “who have the incentive — and the right — to complain about overcharges paid as a result of the potash cartel, and whose interests will be sacrificed if the law is interpreted not to permit this kind of case.”
The 2008 complaint alleged that a cartel among potash producers between 2003 and 2008 increased prices 600%. The en banc court made clear that its decision on the jurisdictional question should not be read as a comment on the merits or any other potential defense.