Julia Roberts in Conspiracy Theory (1997).
Do plaintiffs’ lawyers care whether
conspiracy theories make sense?
Yesterday, Blawgletter asked what keeps class action lawyers from filing suit in the wake of some criminal price-fixing investigations but not others. Does the answer depend mainly — as Antitrust Review suggests — on the size of the potential recovery?
Blawgletter says nuh-uh. Consider questions that flash through class counsel’s mind upon hearing of a criminal antitrust investigation:
- Has the investigation produced indictments? Guilty pleas? Does it seem likely to?
- Did the Antitrust Division grant immunity to a conspirator under its corporate leniency program?
- Does the structure of the industry — such as small number of horizontal competitors that sell a fungible product — make an effective conspiracy plausible?
- Does the investigation involve repeat offenders — companies that fixed prices in other markets?
- Do the conspirators have the resources to pay a judgment?
- Has a reputable firm already brought a case?
Each yes answer increases confidence in the merits and therefore the probability of filing. Each no answer — especially to question 3 or 5 — cuts the likelihood of suit.
The sane members of the plaintiffs bar know, from hard experience, that the amount in controversy doesn’t matter if you can’t recover it.