July Antitrust Bulletin (2012)

Court Expands Extraterritorial Scope of U.S. Antitrust Law

On June 27, 2012, a federal appeals court issued an opinion that reversed prior precedent, extended the reach of federal antitrust law to foreign commerce in certain cases, and revived a class action brought by U.S. purchasers alleging that potash producers had operated a cartel outside the United States that had influenced the price of potash in the United States. Potash is a mineral used primarily in fertilizer. The world market for potash is highly concentrated and U.S. customers account for a high percentage of sales. In part of its opinion the court interpreted an import-related exception to the Foreign Trade Antitrust Improvements Act (FTAIA) - foreign trade or commerce that has "direct, substantial, and reasonably foreseeable" effects on U.S. domestic or import commerce - holding that "for FTAIA purposes, the term 'direct' means only a 'reasonably proximate causal nexus.'" In so holding, the court