12.8 MISCELLANEOUS ISSUES
12.801 Pleading a Claim. The Act does not contain any heightened pleading standard for violations. Nevertheless, the courts often require more than mere notice pleading, especially when a complaint alleges an antitrust conspiracy. For example, the United States Supreme Court has held that allegations of parallel conduct were not sufficient to maintain an action for antitrust conspiracy. 122 Plaintiffs are required to allege parallel conduct "in a context that raises a suggestion of a preceding agreement, not merely parallel conduct that could just as well be independent action." 123 The allegations of conspiracy must consist of more than mere "labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." 124 Rather, a complaint alleging conspiracy must state enough facts to plausibly suggest the existence of a conspiracy. 125 However, while facts supporting the
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claim are required, the courts deny that a heightened pleading standard exists for conspiracy claims. 126
12.802 Effect of Conviction. Where a final judgment is entered against a defendant for violation of the Act under section 59.1-9.15(a) (action for injunctive relief or civil penalties), the judgment may be used as prima facie evidence against the defendant in any other private or government action brought against the defendant for damages. 127 The judgment may not be used for this purpose if it results from a consent judgment or decree entered before any testimony has been taken. 128
12.803 Statute of Limitations. Actions brought by the government to recover civil penalties must be brought within four years after the cause of action accrues. 129 In actions brought by the government or private parties for damages for injury to business or property, the limitations period is the longer of (i) four years after the action accrues or (ii) within one year after the conclusion of any action or proceeding brought by the government for civil penalties or injunctive relief, as long as the government action or proceeding is based in whole or in part on the same matter complained of in the action for damages. 130
If the cause of action is for an antitrust conspiracy, it is likely to accrue when one is "injured in his . . . business." 131 This includes when "any damage, however slight, is sustained." 132 Nevertheless, Virginia courts are likely to follow federal antitrust case law, which holds that each time a federal antitrust plaintiff is injured by a defendant's act in a continuing conspiracy to violate the antitrust laws, a cause of action accrues for damages caused by that act. Accordingly, limitations run from the date that each such act is committed. 133 But this rule only applies where there is an overt act in
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furtherance of an antitrust conspiracy or a separate substantive violation that is committed within the limitations period. 134
The Act provides a four-year statute of limitations unless that time period is extended due to a government investigation for violations of the Act, including antitrust conspiracies under sections 59.1-9.5 (prohibiting conspiracies in restraint of trade) and 59.1-9.6 (prohibiting conspiracies to monopolize). However, it should be noted that the Fourth Circuit Court of Appeals, relying on section 8.01-243, 135 has held that a five-year limitations period applies to statutory conspiracy claims under sections 18.2-499 and 18.2-500, which provide for mandatory trebling of damages. 136 It is likely that the Virginia Supreme Court would adopt a five-year statute of limitations for statutory conspiracy claims as well. 137 Consequently, a statutory conspiracy claim provides advantages over an antitrust claim, especially since the conspiracy statute likely is not "solely supplemental to, and only governs conduct beyond, the Virginia Antitrust Act." 138
12.804 State Action Immunity. The state action doctrine, rooted in the principles of federalism, was announced by the U.S. Supreme Court in Parker v. Brown. 139 Under the doctrine, states and political subdivisions are immune under the federal antitrust laws where there has been a "clearly articulated and affirmatively expressed" state policy through legislation to
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displace competition. 140 The rationale is that the federal government will respect state law, even if it is anticompetitive. However, state subdivisions have no inherent immunity. Before a municipality will be immune, it must demonstrate that is engaging in the challenged activity pursuant to a clearly expressed state policy. 141
Under federal law, state-authorized private action also is immune if it meets a two-part test. Under the first part of the test, the non-state actor must show a clearly articulated policy to displace competition. 142 Compulsion to act is not necessary under the "clear articulation" prong of the test. Nor must a state legislature "expressly state in a statute or its legislative history that the legislature intends for the delegated action to have anticompetitive effects." 143 It is enough that anticompetitive conduct is a "foreseeable result" from the regulatory regime established by the state. 144 The second part of the test requires a showing that the state actively supervises that policy or activity. 145 Importantly, the state's supervision must be real and active. 146
The federal courts either have presumed that the doctrine applies to actions under the Act 147 or have not directly addressed the doctrine's applicability to the Act. While the Virginia Supreme has not spoken to the issue, a circuit court in Fairfax County Water Authority v. City of Falls Church 148 held that the state action doctrine had no application under the Act. In that case, the Water Authority, which was in competition with the City for the provision of water to local residents, including residents in Fairfax County and outside the City of Falls Church, alleged that it provided water at a much lower rate than the City, that the City used profits gained from its higher
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rates for its general fund, and that the City forced developers to connect to the City's system to maintain those profits. The Water Authority also alleged that the City improperly told citizens and businesses that it had the exclusive right to provide water to them and threatened them with baseless civil and criminal sanctions if they attempted to connect to the Water Authority's system. Based on these allegations, the Water Authority sought injunctive relief against the City's conduct, claiming that the City had engaged in monopolization or attempted monopolization in violation of section 59.1-9.6.
The City demurred, claiming that the state action doctrine precluded liability for the conduct alleged. The court disagreed, noting the following:
Although honorable and esteemed courts cited by both parties have applied the federal doctrine to claims raised under state antitrust laws, the Virginia Supreme Court has never applied the doctrine to claims made under state law, and this Court declines to do so here. Instead, the proper question is whether the City's actions are "authorized, regulated or approved . . . by a statute of this Commonwealth. . . ." 149
The court went on to analyze whether the enabling statute for Virginia public utilities provided them the authority to engage in anticompetitive conduct outside their geographic limits and found that it did not. "[N]othing in the statutory provisions cited by the parties authorizes the City to engage in anti-competitive behavior in the provision of municipal utility services in a neighboring municipality, without first obtaining the consent of the neighboring municipality." 150 Consequently, the court refused the demurrer on the grounds that the City's conduct was not immunized by statute.
12.805 Noerr-Pennington Immunity. A longstanding doctrine of federal antitrust law, called the Noerr-Pennington doctrine, was first acknowledged by the Virginia Supreme Court in Lockheed Information Management Systems Co. v. Maximus, Inc. 151 In that case, the court explained the doctrine as follows:
This doctrine is based on United Mine Workers v. Penning-ton, 381 U.S. 657. . . (1965), and Eastern Railroad Presidents
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Conference v. Noerr Motor Freight, Inc., 365 U.S. 127. . . (1961). The doctrine developed because business entities seeking to influence legislative or executive policy which would benefit them and injure competitors were charged with violations of the federal anti-trust laws. Grounded in the constitutional right to free speech and to petition the government, the Noerr-Pennington doctrine provides that persons petitioning the government cannot be charged with violations of the Sherman Antitrust Act for attempts to influence legislative or executive action. Pennington, 381 U.S. at 669; Noerr, 365 U.S. at 135. The doctrine also applies to adjudicatory proceedings before administrative agencies. California Motor Transport Co. v. Trucking Unlimited, 404 U.S. 508, 510-11. . . (1972). 152
Maximus involved claims for tortious interference and conspiracy in connection with a protest by Lockheed of a government notice to award a...
