PRINTER'S NO. 4282
No. 2760 Session of 2008
INTRODUCED BY REICHLEY, BEAR, CLYMER, CUTLER, DALEY, DALLY,
DENLINGER, FRANKEL, FREEMAN, GEIST, GINGRICH, GOODMAN,
HENNESSEY, HORNAMAN, KAUFFMAN, LONGIETTI, MARSICO, MELIO,
MENSCH, R. MILLER, MOYER, O'NEILL, PYLE, RAPP, SCHRODER,
SONNEY, SURRA, SWANGER, THOMAS AND WALKO, SEPTEMBER 9, 2008
REFERRED TO COMMITTEE ON COMMERCE, SEPTEMBER 9, 2008
AN ACT
1 Prohibiting unreasonable restraints of trade; imposing
2 penalties; and providing for enforcement.
3 The General Assembly of the Commonwealth of Pennsylvania
4 hereby enacts as follows:
5 Section 1. Short title.
6 This act shall be known and may be cited as the Pennsylvania
7 Antitrust Act.
8 Section 2. Declaration of policy.
9 The General Assembly finds and declares that the purpose of
10 this act is to promote the public benefits of a competitive
11 economic environment and to protect the economic welfare of
12 consumers, businesses and the Commonwealth.
13 Section 3. Definitions.
14 The following words and phrases when used in this act shall
15 have the meanings given to them in this section unless the
16 context clearly indicates otherwise:
1 "Attorney General." Includes a designated deputy Attorney
2 General. The term shall not include a private attorney or law
3 firm.
4 "Business of insurance." That business of insurance
5 conducted by an insurance company, association or reciprocal,
6 nonprofit hospital plan corporation, nonprofit professional
7 health service plan, health maintenance organization, fraternal
8 benefits society or any risk-assuming preferred provider
9 organization and nonrisk-assuming preferred provider
10 organization not governed and regulated under the Employee
11 Retirement Income Security Act of 1974 (Public Law 93-406, 88
12 Stat. 829).
13 "Person." An individual, partnership, corporation,
14 association or other entity individually or as a part of an
15 alleged class, or through its officers, agents, employees or
16 attorneys or those acting in concert with the person. The term
17 includes a political subdivision.
18 "Political subdivision." Includes an agency, a board, a
19 commission or an authority of a political subdivision.
20 "Reasonable cause to believe." The totality of facts and
21 circumstances are sufficient to warrant belief by a person of
22 reasonable caution that further investigation is necessary. It
23 shall not require the Attorney General to establish probable
24 cause or a prima facie case.
25 "Trade secret." Anything which constitutes, represents,
26 evidences or records secret or confidential scientific,
27 technical, merchandising, production, management or commercial
28 information.
29 Section 4. Unreasonable restraints of trade.
30 A contract, combination or conspiracy in restraint of trade
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1 or commerce in this Commonwealth is unlawful.
2 Section 5. Penalties.
3 (a) Criminal penalty.--
4 (1) A partnership, corporation, association or other
5 entity which violates section 4 commits a felony of the third
6 degree and shall, upon conviction, be sentenced to pay a fine
7 of not more than $1,000,000.
8 (2) An individual who violates section 4 commits a
9 felony of the third degree and shall, upon conviction, be
10 sentenced to pay a fine of not more than $100,000 or to
11 imprisonment for not more than three years, or both.
12 (b) Enforcement.--The Attorney General shall have standing
13 and authority to prosecute an action for a criminal penalty.
14 (c) Alternative civil penalty.--In lieu of criminal
15 prosecution under subsection (b), the Attorney General may elect
16 to bring an action for a civil penalty. In an action under this
17 subsection:
18 (1) An individual who violates section 4 shall be liable
19 for a penalty of not more than $100,000 for each violation
20 and for the cost of suit, including a reasonable attorney
21 fee.
22 (2) A partnership, corporation, association or other
23 entity which violates section 4 shall be liable for a penalty
24 of not more than $1,000,000 for each violation and for the
25 cost of the suit, including a reasonable attorney fee.
26 (d) Factors to be considered.--In determining the
27 appropriate sanctions to be imposed under this section, the
28 court shall consider at least the following factors:
29 (1) The prior criminal record of the violator.
30 (2) The size and amount of the contract involved, if
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1 any.
2 (e) Disposition of fines and penalties.--Criminal fines and
3 civil penalties collected under this section shall be paid into
4 the State Treasury and deposited in the appropriate fund.
5 (f) Limitation of action.--An action under this section must
6 be commenced within four years after the violation of this act
7 is committed.
8 (g) Double jeopardy.--A criminal prosecution or an action
9 solely for a civil penalty under this section may not be brought
10 against a person previously charged by information or indictment
11 with a criminal violation of 62 Pa.C.S. Ch 45 (relating to
12 antibid-rigging) or of a Federal antitrust statute if either
13 prosecution is based upon substantially the same conduct upon
14 which a prosecution under this section could be based and
15 jeopardy has attached under the prosecution.
16 (h) Other actions.--An action under this section does not
17 bar administrative sanctions, a civil action for injunctive
18 relief under section 6 or a civil action for damages or
19 injunctive relief under section 7.
20 Section 6. Injunctive relief.
21 (a) Action by Attorney General.--The Attorney General may
22 bring a civil action against any person to restrain the conduct
23 prohibited by this act.
24 (b) Commencement of action.--An action under this section
25 must be commenced within four years after the violation of this
26 act is committed.
27 Section 7. Private cause of action.
28 (a) Cause of action.--
29 (1) A person directly injured in the person's business
30 or property as a result of an act prohibited by this act
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1 shall have a right to bring a civil action for damages or
2 injunctive relief.
3 (2) The Commonwealth, whether a direct or indirect
4 purchaser, when injured in its business or property as a
5 result of an act prohibited by this act, shall have the right
6 to bring a civil action for damages or injunctive relief. In
7 an action by the Commonwealth as an indirect purchaser, the
8 court shall take necessary steps, including transfer and
9 consolidation, to avoid duplicate liability for the same
10 injury.
11 (3) Neither the Commonwealth nor any person may maintain
12 or continue to maintain a civil action under this act based
13 on any transactions or occurrences if a final judgment as to
14 which all appeals have been exhausted has been entered in an
15 action by or on behalf of the Commonwealth or the person
16 under the antitrust laws of the United States or another
17 state for injury arising from the same transactions,
18 occurrences or circumstances.
19 (b) Limitation of action.--A cause of action arises under
20 this section at the time the conduct in violation of this act is
21 discovered or should have been discovered or, for a continuing
22 violation, at the time the latest violation of this act is
23 discovered or should have been discovered. An action under this
24 section must be brought within four years of the date when the
25 cause of action arises. During the pendency of an action under
26 section 5 and for one year after the action is completed, the
27 limitation under this subsection is tolled if the action under
28 this section is based in whole or in part on any matter
29 complained of in the action under section 5, provided that,
30 whenever the running of the statute of limitations in respect of
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1 a cause of action arising under this section is tolled
2 hereunder, any action to enforce that cause of action shall be
3 forever barred unless commenced either within the period of
4 suspension or within four years after the cause of action
5 accrued.
6 (c) Damages.--Damages recoverable under this act by the
7 Commonwealth and by any person shall be actual damages sustained
8 plus the cost of suit, including reasonable attorney fees. If
9 the circumstances warrant, damages recoverable under this act by
10 any person may be three times the actual damages sustained plus
11 taxable costs and reasonable attorney fees. Damages are subject
12 to the following:
13 (1) Neither the Commonwealth nor any person shall be
14 awarded any damages, including treble damages, if a court of
15 another jurisdiction has already entered judgment on a claim
16 by the Commonwealth or the person arising out of the same
17 transaction or occurrence.
18 (2) If the conduct which gives rise to a violation of
19 this act also gives rise to a violation of 62 Pa.C.S. Ch. 45
20 (relating to antibid-rigging) the amount awarded as civil
21 damages or compensation under this act shall not duplicate
22 the amount awarded under 62 Pa.C.S. Ch. 45.
23 (d) Costs in injunction actions.--In an injunction action in
24 which the plaintiff substantially prevails, the court shall
25 award the cost of suit, including a reasonable attorney fee.
26 (e) Liability.--Liability under this section shall be joint
27 and several. Persons subject to liability under this act shall
28 be entitled to contribution in accordance with 42 Pa.C.S. Ch. 83
29 Subch. B (relating to contribution among tort-feasors).
30 (f) Notice to Attorney General.--Within ten days of filing a
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1 complaint under this section, the plaintiff shall serve a copy
2 of the complaint upon the Attorney General by registered mail. A
3 copy of the certificate of service shall be filed with the
4 court.
5 (g) Collateral estoppel.--A criminal conviction for a
6 violation of section 4 shall be prima facie evidence as to
7 liability of the convicted participants in a civil action under
8 this section. This subsection does not apply to pleas of no
9 contest or to consent decrees. Nothing contained in this
10 subsection shall be construed to impose a limitation on the
11 application of collateral estoppel.
12 (h) Authority of Attorney General.--The Attorney General
13 shall have authority under this section:
14 (1) To bring all actions on behalf of the Commonwealth.
15 (2) To bring an action as parens patriae on behalf of
16 individuals who have suffered an injury to their property by
17 reason of a violation of this act and who resided in this
18 Commonwealth when the violation occurred.
19 (3) To bring an action on behalf of a political
20 subdivision, if requested to do so by the political
21 subdivision.
22 Section 8. Exemptions.
23 (a) Sovereign immunity.--The Commonwealth shall not be
24 liable in actions under this act. Commonwealth officials and
25 employees acting in their official capacities shall not be
26 liable for penalties under section 5 or for damages, costs and
27 attorney fees under section 7.
28 (b) Governmental and official immunity.--Political
29 subdivisions shall not be liable in actions under this act.
30 Officials and employees of political subdivisions acting in
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1 their official capacities shall not be liable for penalties
2 under section 5 or for damages, costs and attorney fees under
3 section 7.
4 (c) State action.--Conduct which results from a clearly
5 articulated and affirmatively expressed State policy and which
6 is actively supervised by the Commonwealth shall not constitute
7 a violation of this act.
8 (d) Labor organizations.--The existence and operation of a
9 labor organization and the exercise of lawful activities of a
10 labor organization shall not constitute a violation of this act.
11 (e) Cooperative associations.--The collective activities of
12 an agricultural or a horticultural cooperative association to
13 process, prepare for market, handle and market members'
14 products, whether or not the activities restrain competition
15 among the members of the association, shall not constitute a
16 violation of this act.
17 (f) Business of insurance.--This act does not apply to the
18 business of insurance to the extent that the business:
19 (1) is regulated by the Insurance Commissioner; and
20 (2) does not constitute a boycott, coercion or
21 intimidation or an agreement to boycott, coerce or
22 intimidate.
23 (g) Federal or State exempt activities.--Any activity or
24 conduct authorized by or exempt from Pennsylvania statutory or
25 common law, or exempt from the provisions of the antitrust laws
26 of the United States, shall be exempt from the provisions of
27 this act. This section shall specifically apply to any activity
28 or conduct authorized by the board of the Ben Franklin
29 Partnership Fund, as authorized by the act of July 2, 1993
30 (P.L.439, No.64), known as the Ben Franklin/IRC Partnership Act.
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1 Any activity or conduct subject to any other Federal statute
2 that limits, modifies or otherwise affects the applicability of
3 one or more provisions of the Federal antitrust statutes, or
4 Federal judicial opinions interpreting those statutes, shall to
5 that extent be exempt from the provisions of this act.
6 Section 9. Investigation.
7 (a) General power.--If the Attorney General has reasonable
8 cause to believe that a violation of this act has occurred, the
9 Attorney General shall have authority to investigate on behalf
10 of the Commonwealth, its citizens or a political subdivision.
11 (b) Attendance and production of documents.--Prior to the
12 institution of a civil action, the Attorney General is
13 authorized to require the attendance and testimony of witnesses
14 and the production of documents. Prior to the issuance of a
15 subpoena under this section, the Attorney General shall make a
16 request for information. A request for information shall state
17 the subject matter of the investigation, the conduct
18 constituting the alleged violation which is under investigation
19 and the provisions of this act applicable to the alleged
20 violation. A request for documentary material shall describe the
21 material to be produced with reasonable particularity so as to
22 fairly identify the documents demanded, provide a return date
23 within which the material is to be produced and identify the
24 member of the Attorney General's staff to whom the material
25 shall be given. For this purpose, the Attorney General may issue
26 subpoenas, examine witnesses and receive evidence. If a person
27 objects to or otherwise fails to comply with a subpoena or
28 request for testimony, the Attorney General may file in
29 Commonwealth Court an action to enforce the subpoena or request.
30 Notice of hearing the action and a copy of all pleadings shall
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1 be served upon the person, who may appear in opposition.
2 (c) Confidentiality.--
3 (1) Any testimony taken or material produced shall be
4 kept confidential by the Attorney General except to the
5 extent he may use information in a judicial proceeding or if
6 the disclosure is authorized by the court for good cause
7 shown or confidentiality is waived by the person being
8 investigated and by the person who has testified, answered
9 interrogatories or produced materials.
10 (2) At the Attorney General's discretion, the Attorney
11 General may disclose information discovered under this
12 section to the United States Department of Justice, the
13 Federal Trade Commission, another state or territory of the
14 United States, the District of Columbia and another agency of
15 the Commonwealth, upon the prior certification of an
16 appropriate official of the recipient that the information
17 will be maintained in confidence other than use for official
18 purposes and that the recipient will abide by the provisions
19 of paragraph (1). However, trade secrets may not be disclosed
20 by the Attorney General without the approval of the
21 Commonwealth Court, after notice to the person who produced
22 the information.
23 (3) The Attorney General may use information, including
24 documents, obtained under this section in an action brought
25 under this act or Federal antitrust statutes; however,
26 information relating to trade secrets may not be made public
27 in an action without the approval of the court in which the
28 action is pending, after notice to the person who produced
29 the information.
30 (d) Limitation on use.--No criminal prosecution under this
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1 act may be brought by the Attorney General based principally
2 upon information or documents obtained in a civil investigation
3 under this section.
4 (e) Wrongful disclosure of information.--Any person who
5 publishes or communicates any procedure, testimony or material
6 produced, which is required to be kept confidential pursuant to
7 this section, commits a misdemeanor of the third degree.
8 Section 10. Consistency with Federal law.
9 The provisions of this act which parallel provisions of
10 Federal antitrust statutes shall be construed consistently with
11 pertinent Federal statutes and Federal judicial opinions
12 interpreting those Federal statutes.
13 Section 20. Effective date.
14 This act shall take effect in 60 days.
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