By Andrew Longstreth
NEW YORK, Feb 15 (Reuters) - Life has been getting tougher
for antitrust plaintiffs' lawyers, forced by courts to clear
higher and higher procedural hurdles before being allowed to
present their cases to a jury.
Judges have cited, among other reasons, a need to limit
meritless lawsuits, increasing skepticism of the value of
private antitrust lawsuits in general.
A new academic paper challenges the skeptics.
Robert Lande of the University of Baltimore School of Law
and Joshua Davis of the University of San Francisco School of
Law argue that the flaws of private antitrust enforcement "have
been exaggerated beyond recognition and its benefits have been
seriously underestimated."
The paper, "Defying Conventional Wisdom: The Case for
Private Antitrust Enforcement," which was posted this month on
the Social Science Research Network website, analyzes 60 recent
large and significant private antitrust class actions.
The cases were not selected at random. Lande and Davis wrote
that they chose large cases that appeared to have merit.
The authors cautioned it would be "inappropriate to make any
strong empirical claims about whether private antitrust actions
on the whole tend to be meritorious" based on their study.
The study's purpose was to "assess some of the benefits from
private enforcement, not to do a cost-benefit analysis," they
wrote.
By contrast, the scholars noted, critics of private
enforcement "have never presented systematic evidence for their
conclusions."
In their study, the authors looked at several indicators of
the 60 cases to measure their merits, including amounts
recovered by the plaintiffs. The authors found the recovery in
only a few cases was less than $50 million, while over half were
settled for more than $100 million.
"Only the meaningful prospect of losing litigation -
including after exhausting the appellate process - could explain
settlements for such large amounts," the authors wrote.
Citing other evidence, Lande and Davis suggest that their
sample of cases involved meritorious claims. For instance, out
of the 60 cases, 28 percent involved defendants or their
employees who were subject to criminal penalties.
In 25 percent of all the cases, the authors found, the
plaintiffs survived or prevailed on motions for summary judgment
or other similar motions.
In all, 88 percent of the cases they studied had at least
one indicator that the plaintiffs' case had merit.
The evidence taken from all the cases, Lande and Davis
argue, shows that the private antitrust enforcement can be
effective in compensating victims and should be strengthened.
Follow us on Twitter @ReutersLegal | Like us on Facebook