Case: 1:16-cv-08637 Document #: 5163 Filed: 10/28/21 Page 1 of 29 PageID #:309263
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`UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`
`IN RE BROILER CHICKEN ANTITRUST
`LITIGATION
`
`Civil Action No. 1:16-cv-08637
`
`THIS DOCUMENT RELATES TO:
`CERTAIN DIRECT ACTION PLAINTIFF
`CASES
`
`Judge Thomas M. Durkin
`Magistrate Judge Jeffrey T. Gilbert
`
`MOTION TO PRECLUDE ENFORCEMENT OF
`CERTAIN DEFENDANTS’ JUDGMENT SHARING AGREEMENT
`
`

`

`Case: 1:16-cv-08637 Document #: 5163 Filed: 10/28/21 Page 2 of 29 PageID #:309264
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`TABLE OF CONTENTS
`
`TABLE OF AUTHORITIES .......................................................................................................... ii
`
`BACKGROUND ............................................................................................................................ 3
`
`I. Defendants’ “Judgment Sharing Agreement” ...................................................................... 3
`
`II. The JSA and Settlement Agreements with the Classes ....................................................... 4
`
`III. Direct Action Plaintiffs’ Request to Defendants for Production of the JSA ....................... 6
`
`ARGUMENT .................................................................................................................................. 7
`
`I.
`
`The JSA’s J&S Negation Provision Should Be Found Invalid and Unenforceable ............ 7
`
`A.
`
`B.
`
`C.
`
`D.
`
`Private Antitrust Enforcement and the Role of Joint and Several Liability .............. 7
`
`The JSA’s J&S Negation Provision is Incompatible with the Federal Antitrust
`Regime ..................................................................................................................... 10
`
`The JSA’s J&S Negation Provision Violates Section 1 of Sherman Act ................ 14
`
`The JSA’s J&S Negation Provision is Void Under Illinois Law ............................. 15
`
`II. The JSA’s Settlement Agreement Sharing Provision Should Be Found
`Unenforceable ................................................................................................................... 16
`
`CONCLUSION ............................................................................................................................. 17
`
`i
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`

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`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`
`Apple Inc. v. Pepper,
`139 S. Ct. 1514 (2019)................................................................................................................. 8
`
`Armstrong v. Bd. of Sch. Dirs.,
`616 F.2d 305 (7th Cir. 1980) ..................................................................................................... 17
`
`Beaver v. Country Mut. Ins. Co.,
`95 Ill. App. 3d 1122 (5th Dist. 1981) ........................................................................................ 10
`
`Burlington Indus. v. Milliken & Co.,
`690 F.2d 380 (4th Cir. 1982) ....................................................................................................... 9
`
`Cali Express, Inc. v. Bermingham,
`2015 WL 13631361 (S.D. Ind. July 20, 2015) .......................................................................... 16
`
`City of Atlanta v. Chattanooga Foundry & Pipeworks,
`127 F. 23 (6th Cir. 1903) ............................................................................................................. 8
`
`Dunbar v. American Tel. & Tel. Co.,
`87 N.E. 521 (Ill. 1909) ............................................................................................................... 15
`
`Elec. Contractors’ Ass’n of City of Chi. v. A.S. Schulman Elec. Co.,
`63 N.E.2d 392 (Ill. 1945) ........................................................................................................... 15
`
`Flintkote Co. v. Lysfjord,
`246 F.2d 368 (9th Cir. 1957) ....................................................................................................... 9
`
`Fox Midwest Theaters, Inc. v. Means,
`221 F.2d 173 (8th Cir. 1955) ..................................................................................................... 14
`
`Goesel v. Boley Int’l (H.K.) Ltd.,
`738 F.3d 831 (7th Cir. 2013) ..................................................................................................... 16
`
`Hasbrouck v. BankAmerica Housing Servs.,
`187 F.R.D. 453 (N.D.N.Y. 1999) .............................................................................................. 16
`
`Hawaii v. Standard Oil Co. of Cal.,
`405 U.S. 251 (1972) .................................................................................................................... 7
`
`Illinois Brick Co. v. Illinois,
`431 U.S. 720 (1977) .................................................................................................................... 7
`
`ii
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`In re Brand Name Prescription Drugs Antitrust Litigation,
`1995 WL 221853 (N.D. Ill. 1995) ............................................................................................. 10
`
`In re Ins. Brokerage Antitrust Litig.,
`282 F.R.D. 92 (D.N.J. 2012) ..................................................................................................... 17
`
`In re Sch. Asbestos Litig.,
`921 F.2d 1330 (3d Cir. 1990) .................................................................................................... 17
`
`Ironshore Speciality Ins. Co. v. Akorn, Inc.,
`2021 WL 2399997 (N.D. Ill. June 11, 2021) ............................................................................. 10
`
`Jessup v. Luther,
`277 F.3d 926 (7th Cir. 2002) ..................................................................................................... 16
`
`Jewel Tea Co. v. Local Unions,
`274 F.2d 217 (7th Cir. 1960) ..................................................................................................... 14
`
`Kelly v. Kosuga,
`358 U.S. 516 (1959) .................................................................................................................. 14
`
`Lawlor v. Nat’l Screen Serv. Corp.,
`349 U.S. 322 (1955) .................................................................................................................. 14
`
`Marion Healthcare, LLC v. Becton Dickinson & Co.,
`952 F.3d 832 (2020) .................................................................................................................... 8
`
`Memorial Hosp. for McHenry Cnty. v. Shadur,
`664 F.2d 1058 (7th Cir. 1981) ................................................................................................... 14
`
`Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.,
`473 U.S. 614 (1985) .................................................................................................................. 13
`
`Oberweis Dairy, Inc. v. Associated Milk Producers, Inc.,
`568 F. Supp. 1096 (N.D. Ill. 1983) ............................................................................................ 13
`
`Paper Sys. Inc. v. Nippon Paper Indus. Co.,
`281 F.3d 629 (7th Cir. 2002) ........................................................................................... 8, 10, 12
`
`Paramount Famous Lasky Corp. v. United States,
`282 U.S. 30 (1930) .................................................................................................................... 14
`
`Perez v. Z Frank Oldsmobile, Inc.,
`223 F.3d 617 (7th Cir. 2000) ..................................................................................................... 10
`
`iii
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`Perma Life Mufflers, Inc. v. Int’l Parts Corp.,
`392 U.S. 134 (1968) .................................................................................................................... 7
`
`Platinum Supplemental Ins., Inc. v. Guarantee Trust Life Ins. Co.,
`989 F.3d 556 (7th Cir. 2021) ..................................................................................................... 13
`
`Scentura Creations, Inc. v. Long,
`756 N.E.2d 451 (Ill. App. Ct. 2001) .......................................................................................... 15
`
`Simpson v. Union Oil Co. of Cal.,
`377 U.S. 13 (1964) .................................................................................................................... 13
`
`Tex. Indus., Inc. v. Radcliff Materials, Inc.,
`451 U.S. 630 (1981) ................................................................................................................ 7, 8
`
`Wal-Mart Stores, Inc. v. Visa U.S.A., Inc.,
`396 F.3d 96 (2d Cir. 2005) ........................................................................................................ 17
`
`Wells Fargo Funding v. Draper & Kramer Mortg. Corp.,
`608 F. Supp. 2d 981 (N.D. Ill. 2009) ......................................................................................... 13
`
`Zenith Radio Corp. v. Hazeltine Research, Inc.,
`395 U.S. 100 (1969) .................................................................................................................... 7
`
`Statutes
`
`15 U.S.C. § 15 ............................................................................................................................... 12
`
`Pub. L. No. 108–237, § 213(a), 118 Stat. 661 (2004) ..................................................................... 9
`
`Rules
`
`Federal Rule of Civil Procedure Rule 23 ...................................................................................... 15
`
`Other Authorities
`
`ABA Section of Antitrust Law, Antitrust Law Developments (8th ed. 2017) ......................... 9, 12
`
`IIA Phillip E. Areeda, et al., Antitrust Law ¶ 330d (4th 2014) ....................................................... 8
`
`Christopher R. Leslie, Judgment-Sharing Agreements, 58 Duke L.J. 747 (2009) ................. 1, 2, 8
`
`Manual for Complex Litigation, Fourth, § 13.23 at 178 ............................................................. 1, 2
`
`iv
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`Fourteen of the producer Defendants in these cases have entered into a so-called “Judgment
`
`Sharing Agreement” (“JSA”) (Exhibit A). The signatories to this agreement include all of the
`
`largest producers, and all Defendants that have already acknowledged antitrust violations
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`(Pilgrim’s1 and Tyson2), or been indicted for antitrust violations (Claxton and Koch3). “A JSA is
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`a contract among antitrust defendants (and potential antitrust defendants) whereby the signatories
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`agree in advance to their relative responsibility for any antitrust damages awarded at trial against
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`any of them.” Christopher R. Leslie, Judgment-Sharing Agreements, 58 Duke L.J. 747, 755
`
`(2009). Although even a garden-variety JSA may undermine antitrust goals and stabilize cartels,
`
`as Professor Leslie contends,4 with this motion, Certain Direct Action Plaintiffs (“DAPs”) contest
`
`only two provisions of the Defendants’ JSA, which extend well beyond “judgment sharing,” and
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`are antithetical to the federal antitrust regime carefully constructed and maintained by Congress.
`
`First, the JSA disables a central element of federal antitrust law: joint and several liability.
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`With joint and several liability, each defendant “is liable for the overcharges on its co-conspirators’
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`sales.” Leslie, 58 Duke L.J. at 752. But the JSA Defendants have agreed on language to include
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`in settlement agreements with plaintiffs which would eliminate this: “Settling Plaintiff(s) agrees
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`to reduce the dollar amount collectable from non-Settling Parties pursuant to any Final Judgment
`
`1 See United States v. Pilgrim’s Pride Corp., 1:20-cr-00330-RM, No. 58 (D. Colo. Feb. 23, 2021).
`2 See News Release, Tyson Foods Inc., Tyson Foods’ Statement on Dep’t of Justice Indictment in
`Broiler Chicken Investigation (Jun. 10, 2020); https://www.tysonfoods.com/news/news-
`releases/2020/6/tyson-foods-statement-department-justice-indictment-broiler-chicken.
`3 See United States v. Norman W. Fries, Inc. d/b/a/ Claxton Poultry Farms, Koch Foods, Inc.,
`1:21-cr-00168-RM, No. 30 (D. Colo. July 28, 2021).
`4 See Leslie, 58 Duke L.J. at 768-84; see also Manual for Complex Litigation, Fourth, § 13.23 at
`178 (JSAs “create a disincentive for defendants to make available evidence indicating liability on
`the part of codefendants.”). As Professor Leslie observes, “[t]here are sound arguments for why
`the presence of a JSA between price-fixing defendants could be treated as a relevant plus factor”
`evidencing the presence of an unlawful agreement among them. Leslie, 58 Duke L.J. at 820.
`
`1
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`

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`by a percentage equal to the Settling Party’s Sharing Percentage as calculated pursuant to [the
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`JSA] . . . .” JSA § 6(D)(1) (the “J&S Negation Provision”). The JSA Defendants have been able
`
`to disable joint and several liability only by unlawfully coordinating with one another—effectively
`
`engaging in a group boycott, whereby they have arranged that none of them will settle with a
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`plaintiff unless that plaintiff “agrees” to a contractual unwinding of the normal operation of the
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`federal antitrust law. See Leslie, 58 Duke L.J. at 817 (observing “[t]he refusal to settle individually
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`smacks of price-fixing or a group boycott,” and identifying a JSA requirement that plaintiffs forego
`
`joint and several liability as an “area of concern”). This coordination among Defendants harms
`
`plaintiffs, and violates both federal antitrust law and the law of Illinois which governs the JSA.
`
`Second, the JSA provides that each JSA Defendant must provide the others with a copy of
`
`any settlement agreement to which a JSA Defendant is a party, within seven days after executing
`
`the agreement (the “Settlement Agreement Sharing Provision”). See JSA § 6(A). This compact
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`among JSA Defendants to provide one another with a copy of each confidential, non-public
`
`settlement agreement with a plaintiff lacks any legitimate justification, puts the Defendants at a
`competitive advantage vis-à-vis each DAP, and discourages settlements.
`Recognizing that parts of the JSA might be declared “invalid or unenforceable,” the
`
`Agreement expressly provides “the remaining provisions shall continue to be fully operative if
`
`doing so can be done consistently with effectuating the judgment-sharing purpose of this
`
`Agreement . . . .” JSA § 20. For the reasons explained below, the Court should find the J&S
`
`Negation and Settlement Agreement Sharing Provisions of the JSA invalid and unenforceable. See
`
`Manual for Complex Litigation, Fourth, § 13.23 at 178 (“[A]lthough [JSAs] are generally
`
`appropriate, the court may refuse to approve or enforce agreements that violate public policy or
`
`unfairly prejudice other parties.”).
`
`2
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`

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`I.
`
`Defendants’ “Judgment Sharing Agreement”
`
`BACKGROUND
`
`Certain Defendants5 signed a document dated February 25, 2020 entitled Second Amended
`
`Judgment Sharing Agreement, relating to the class actions and direct action lawsuits that have been
`
`consolidated under the title In re Broiler Chicken Antitrust Litigation, Case No. 1:16-cv-08637
`
`(N.D. Ill.).6 The JSA covers: (1) all claims that “allege that the Defendants violated federal and
`
`state antitrust laws, as well as other state laws, by conspiring to fix prices of broiler chickens by
`
`reducing their production”; (2) all claims that “allege that some of the Defendants conspired to
`
`manipulate . . . the Georgia Dock”; and (3) “[t]hose claims, any portions of those claims, and any
`
`amendments or additions made to those claims in the future.” JSA § 1.
`
`The JSA provides that “[a]ny Party may settle a Plaintiff Claim, in whole or in part, at any
`
`time, whether for monetary or non-monetary consideration and/or for injunctive or other relief.”
`
`Id. § 6(A). However, only if a Party enters a “Qualified Settlement” shall such party “have no
`
`5 The following Defendants, through their counsel, signed the JSA (the “JSA Defendants”): Tyson
`Foods Inc., Tyson Chicken, Inc., Tyson Breeders, Inc., Tyson Poultry, Inc. (collectively “Tyson”);
`Pilgrim’s Pride Corporation (“Pilgrim’s”); Sanderson Farms, Inc., Sanderson Farms, Inc. (Foods
`Division), Sanderson Farms, Inc. (Production Division), Sanderson Farms, Inc. (Processing
`Division) (collectively “Sanderson”); Koch Foods, Inc., JCG Foods of Alabama, LLC, JCG Foods
`of Georgia, LLC, Koch Meats Co., Inc. (collectively “Koch”); Wayne Farms LLC (“Wayne”);
`Foster Poultry Farms, a California Corporation, Foster Farms, LLC (collectively “Foster Farms”);
`Perdue Farms, Inc., Perdue Foods LLC (collectively “Perdue”); Mountaire Farms, Inc., Mountaire
`Farms, LLC, Mountaire Farms of Delaware, Inc. (collectively “Mountaire”); Harrison Poultry, Inc.
`(“Harrison”); House of Raeford Farms, Inc. (“House of Raeford”); Case Foods, Inc., Case Farms,
`LLC, Case Farms Processing, LLC (collectively “Case”); Simmons Foods, Inc., Simmons
`Prepared Foods, Inc. (collectively “Simmons”); Mar-Jac Poultry, Inc., Mar-Jac Holdings, Inc.,
`Mar-Jac Poultry MS LLC, Mar-Jac Poultry AL, LLC, Mar-Jac AL/MS, Inc., Mar-Jac Poultry, LLC
`(collectively “Mar-Jac”); and Norman W. Fries, Inc. d/b/a/ Claxton Poultry Farms (“Claxton”).
`6 The JSA amended a previous Judgement Sharing Agreement, dated April 24, 2018 and a First
`Amended Judgement Sharing Agreement, dated September 10, 2018. Defendants have not
`produced either the original or first amended agreement. Thus, Movants do not know the
`substantive changes made to the multiple versions of the JSA or which Defendants signed the
`previous agreements.
`
`3
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`

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`obligation to pay any portion of any other settlement or Final Judgment . . . with respect to any
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`portion of a Claim disposed of by that Party’s Qualified Settlement.” Id. § 6(B). If a party enters
`
`a “Non-Qualified Settlement,” the settling party is still considered a Sharing Party liable to other
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`Sharing Parties for the costs of any Claim that was resolved by its Non-Qualified Settlement and
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`“shall remain liable for the amount it would have paid in accordance with . . . this Agreement as if
`
`it had not settled.” Id. § 6(C).
`
`To be a Qualified Settlement, each settlement with a plaintiff must “expressly provide,”
`
`inter alia:
`
`•
`
`“Settling Plaintiff(s) agrees to reduce the dollar amount collectable from non-
`Settling Parties pursuant to any Final Judgment by a percentage equal to the
`Settling Party’s Sharing Percentage as calculated pursuant to [the Agreement]
`under the assumption that the Settling Party had not settled . . . .” Id. § 6(D)(1).
`
`• The JSA Defendants are “third party beneficiaries of the Settlement.” Id.
`§ 6(D)(3).
`
`The JSA also requires that the signatories promptly provide each other with copies of all settlement
`
`agreements with any plaintiff. Id. § 6(A). (“A Settling Party shall provide to the other Parties
`
`within seven days of execution of any Settlement (i) written notice of any such Settlement, (ii) the
`
`identity of each Plaintiff that is a party to the Settlement, and (iii) a copy of the Settlement.”).
`
`II.
`
`The JSA and Settlement Agreements with the Classes
`
`The first Class settlements were with Defendants which did not join the JSA: Fieldale,
`
`Amick, George’s and Peco. None of the Class settlement agreements with those Defendants
`
`contain a J&S Negation Provision. See Dkt. Nos. 447-2, 1535, 3324, 3670, 4078-3, and 7078-4;
`
`see also Dkt. Nos. 4377-2, 4377-3, and 4377-4.
`
`The existence of the JSA was first disclosed publicly on or around February 2, 2021, when
`
`the Direct Purchaser Plaintiffs (“DPPs”) filed a motion for Preliminary Approval of Settlements
`
`with Pilgrim’s and Tyson. At that time, the DPP Class stated:
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`4
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`

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`[E]ach Settlement refers to a judgment-sharing agreement among certain
`Defendants and, consistent with that agreement (per the Settling Defendants), each
`Settlement removes from the calculation of a damages award resulting from any
`verdict and Final Judgment DPPs may obtain against any other Defendant who is a
`signatory to Defendants’ judgment-sharing agreement certain amounts intended to
`reflect the Settling Defendants’ approximately proportionate sales of Broilers
`(Pilgrim’s Settlement § 38; Tyson Settlement § 40). Thus, any other such
`Defendant against whom DPPs obtain a verdict and judgment would not be jointly
`and severally liable for Tyson or Pilgrim’s share of damages removed pursuant to
`the judgment-sharing agreement resulting from sales to DPP Class.
`
`Dkt No. 4259, at 6-7. Similar language has been included in subsequent memoranda in support of
`
`motions for preliminary approval of Class settlements with Harrison and Mar-Jac. Dkt. No. 4921,
`
`at 6; Dkt No. 5052, at 7. None of the settlement filings included a copy of the JSA itself.
`
`During the hearing on DPPs’ motion for preliminary approval of the Pilgrim’s and Tyson
`
`settlements, the Court requested clarification regarding the JSA, stating: “There was one . . . part
`
`of your motion which I found a little confusing and it’s more my fault than yours, but maybe you
`
`can explain it to me, . . . relating to any verdict in judgment would not be jointly and severally
`
`liable for Tyson and Pilgrim’s damages.” Hr’g on DPP Mot. for Prelim. Approval, Dkt. No. 4387,
`
`at 12:9-14. DPPs’ counsel confirmed that “[s]ome of the defendants in the case entered into a joint
`
`sharing agreement. And what [DPPs] agreed to do as part of the settlement is to confirm this is a
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`qualified settlement, which means that the … damages for Pilgrim’s Pride and Tyson are taken out
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`of any final judgment against the remaining defendants.” Id. at 12:21-13:1.
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`The Court invited defense counsel to address the JSA. Citing the Agreement’s
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`confidentiality provisions, defense counsel stated the JSA was being “disclosed to the extent
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`necessary to proceed with this settlement” and that the DPPs “acknowledge that they will be
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`forfeiting the right to, effectively, ask for Tyson’s share of the damages against other defendants.”
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`Id. at 14:5-10. Defense counsel then added: “But I’m not entirely comfortable discussing the
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`arrangement here.” Id. at 14:11-12. After the Court indicated it understood that and Pilgrim’s and
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`5
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`

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`Tyson “don’t want to be jointly and severally liable for damages [they] already paid out through
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`this settlement,” id. at 14:17-18, DPP counsel explained the JSA worked “slightly different[ly]”
`
`and that “[w]hat it really means is that the percentage of the two settling defendants come out of
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`the damages that we would ask for or be able to ask for against the remaining defendants.” Id. at
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`14:21-15:2.
`
`The Classes have now settled with four Defendants which joined the JSA: Tyson,
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`Pilgrim’s, Mar-Jac, and Harrison. Each of the Class settlements with these Defendants contain a
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`J&S Negation Provision. See Dkt. No. 4259-1 at 30-31, 61-62; Dkt. No. 4377-5 at 28-29; Dkt.
`
`No. 4921-1 at 27-28, 42-43; Dkt. No. 5079-1 at 22-23, 58-60, 93-94.
`
`III.
`
`Direct Action Plaintiffs’ Request to Defendants for Production of the JSA
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`After the existence of the JSA was publicly disclosed, certain DAPs served Pilgrim’s and
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`Tyson with a request for production of the JSA and it exhibits and appendices. Initially, both
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`Pilgrim’s and Tyson refused this request, which required certain DAPs to move to compel
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`production. Dkt. No. 4768. With a motion to compel filed, Pilgrim’s and Tyson elected to not
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`contest it, and produced the JSA after “secur[ing] the consent of the other signatories to produce
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`the JSA in order to resolve the dispute underlying the Motion to Compel.” Letter from J. Tanski
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`and C. Abbott to Mag. Judge Gilbert (July 8, 2021). Pilgrim’s and Tyson originally marked the
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`JSA “Highly Confidential,” but after DAPs contested that designation, Tyson produced the JSA
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`with a “Confidential” designation on July 20, 2021, which permits DAP counsel to show the JSA
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`to their clients.7
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`7 Because Defendants designated the JSA as Confidential, it is being filed as a sealed exhibit to
`this Motion.
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`6
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`

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`ARGUMENT
`
`This motion does not contend that every judgment sharing agreement is necessarily invalid,
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`or contest the practice of defendants agreeing among themselves how to allocate payment of a
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`judgment (i.e., creating a contractual right of contribution among co-defendants) so long as such
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`an agreement does not alter or limit the remedies available to plaintiffs at trial. Instead, Movants
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`challenge two specific and pernicious features of this particular JSA: the J&S Negation Provision,
`
`and the Settlement Agreement Sharing Provision.
`
`I.
`
`The JSA’s J&S Negation Provision Should Be Found Invalid and Unenforceable
`
`The JSA’s J&S Negation Provision should be found invalid and unenforceable for at least
`
`three reasons: (1) it is incompatible with, and has the purpose and effect of undermining, a key
`
`part of the federal antitrust regime created and maintained by Congress; (2) it violates Section 1 of
`
`the Sherman Act; and (3) it is void under Illinois law as contrary to public policy.
`
`A.
`
`Private Antitrust Enforcement and the Role of Joint and Several Liability
`
`When fashioning federal antitrust law, “Congress had many means at its disposal to
`
`penalize violators” and specifically established a scheme “encourag[ing] . . . ‘private attorneys
`
`general.’” Hawaii v. Standard Oil Co. of Cal., 405 U.S. 251, 262 (1972). There has been a
`
`“longstanding policy of encouraging vigorous private enforcement of the antitrust laws,” Illinois
`
`Brick Co. v. Illinois, 431 U.S. 720, 745 (1977), and the “vindication of rights” in private antitrust
`
`suits “supplements federal enforcement and fulfills the objects of the statutory scheme.” Tex.
`
`Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 642 (1981). See also Zenith Radio Corp. v.
`
`Hazeltine Research, Inc., 395 U.S. 100, 130-31 (1969) (“[T]he purpose” of creating and
`
`encouraging private antitrust lawsuit “was not merely to provide private relief, but was to serve as
`
`well the high purpose of enforcing the antitrust laws.”); Perma Life Mufflers, Inc. v. Int’l Parts
`
`7
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`

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`Corp., 392 U.S. 134, 136 (1968) (reversing court of appeals rulings which “seemed to threaten the
`
`effectiveness of the private action as a vital means for enforcing the antitrust policy of the United
`
`States”); Apple Inc. v. Pepper, 139 S. Ct. 1514, 1524 (2019) (rejecting Apple’s proffered view of
`
`the Sherman Act, which would “contradict the longstanding goal of effective private enforcement
`
`and consumer protection in antitrust cases”).
`
`The imposition of joint and several liability on antitrust co-conspirators is a central element
`
`of this private enforcement regime. See Tex. Indus., 451 U.S. at 646 (“defendants should be jointly
`
`and severally liable” in antitrust cases) (citing City of Atlanta v. Chattanooga Foundry &
`
`Pipeworks, 127 F. 23, 26 (6th Cir. 1903), aff’d, 203 U.S. 390 (1906)); Marion Healthcare, LLC v.
`
`Becton Dickinson & Co., 952 F.3d 832, 839 (2020) (“antitrust liability is joint and several”).8
`
`Under “the rule of joint and several liability, . . . each member of a conspiracy is liable for all
`
`damages caused by the conspiracy's entire output.” Paper Sys. Inc. v. Nippon Paper Indus. Co.,
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`281 F.3d 629, 632 (7th Cir. 2002) (citing Tex. Indus., 451 U.S. 630). “If [plaintiffs] can prove that
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`there was indeed a conspiracy, they may collect damages not just firm-by-firm according to the
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`quantity each sold, but from all conspirators for all sales.” Id.; see also IIA Phillip E. Areeda, et
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`al., Antitrust Law ¶ 330d (4th 2014) (“Federal antitrust law follows the common law tort doctrine
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`of joint and several liability for co-conspirators or other joint violators. This means that each co-
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`conspirator can be held liable for the entire damage award even if that particular co-conspirator
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`was responsible for only a small portion of the injury.”); Leslie, 58 Duke L.J. at 752 (with joint
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`and several liability “each price-fixing firm is liable for the overcharges on its co-conspirators’
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`sales”).
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`8 Texas Industries, Inc., 451 U.S. at 646-47, held that under federal antitrust law defendants have
`no statutory or common law right to contribution from co-conspirators.
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`8
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`

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`Case: 1:16-cv-08637 Document #: 5163 Filed: 10/28/21 Page 14 of 29 PageID #:309276
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`Despite its common law origins, joint and several liability has long been firmly entrenched
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`as part of the federal antitrust regime created and maintained by Congress. The Ninth Circuit
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`observed more than six decades ago that joint and several liability is both “firmly rooted” and a
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`“well settled principle.” Flintkote Co. v. Lysfjord, 246 F.2d 368, 397 (9th Cir. 1957). Four decades
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`ago the Fourth Circuit explained that joint and several liability “has been the established doctrine
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`of antitrust law for the better part of a century,” and that “Congress has not seen fit to disapprove.”
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`Burlington Indus. v. Milliken & Co., 690 F.2d 380, 394 (4th Cir. 1982).
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`In the years since, Congress has expressly embraced the critical role of joint and several
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`liability in the private enforcement of federal antitrust law. When Congress enacted the Antitrust
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`Criminal Penalty Enhancement and Reform Act of 2004 (“ACPERA”), a statutory leniency
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`program designed to promote cooperation and full disclosure by antitrust law offenders, it did two
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`specific things with respect to joint and several liability. First, it specified that one of the statutory
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`inducements to encourage amnesty should be the elimination of joint and several liability for
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`successful leniency applicants. See ACPERA, Pub. L. No. 108–237, § 213(a), 118 Stat. 661
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`(2004); see also ABA Section of Antitrust Law, Antitrust Law Developments 977 (8th ed. 2017)
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`(“ACPERA offers the successful amnesty applicant . . . relief from joint and several liability.”).
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`Second, the statute provided that nothing in the Act “shall be construed to . . . affect, in any way,
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`the joint and several liability of any party to a civil action . . . other than that of the antitrust leniency
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`applicant and cooperating individuals . . . .”. ACPERA § 214 (3). Thus, ACPERA adopted and
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`reaffirmed the centrality of joint and several liability in private actions brought under federal
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`antitrust law. In doing so Congress recognized, like the Seventh Circuit, that in the federal antitrust
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`9
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`

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`Case: 1:16-cv-08637 Document #: 5163 Filed: 10/28/21 Page 15 of 29 PageID #:309277
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`regime, “[j]oint and several liability is a vital instrument for maximizing deterrence.” Paper Sys.,
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`281 F.3d at 633.9
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`B.
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`The JSA’s J&S Negation Provision is Incompatible with the Federal Antitrust
`Regime
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`Through the JSA, the Defendants seek to displace joint and several liability as a feature of
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`federal antitrust law. The JSA is explicit about having joint and several liability as a primary
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`target, explaining in its Preamble:
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`[L]iability in the Broiler Chicken Cases is “joint and several,” without the right to
`seek “contribution” from other Defendants for their respective shares of the total
`judgment. That means that even if Plaintiffs go to trial against just one (or a small
`number) of Defendants, such Defendant(s) might have to pay three times the
`damages found to have been caused by the conduct of all the Defendants, even
`those that already settled (less any amounts they paid to settle). It also means that
`if a jury returns a verdict for triple damages and attorneys’ fees against multiple
`Defendants, Plaintiffs can force a single Defendant to pay that entire amount, i.e.,
`three times the damages associated with all of the Defendants’ sales, and that single
`Defendant would have no right to recover any of what it paid from the Defendants
`who paid nothing.
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`JSA § 1.
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`9 Case law adjudicating the validity of judgment sharing agreements is limited, and Movants are
`unaware of any order addressing the arguments presented here applied to a provision