## Facts

- U.S. purchasers of potash sued major global potash producers, alleging a cartel that restricted output and raised prices in violation of Sherman Act § 1.
- Defendants were leading producers with major operations outside the United States; potash was sold in a global market and purchased for U.S. fertilizer and other uses.
- Plaintiffs alleged coordinated production cutbacks, joint ventures, and meetings used to maintain and monitor collusion.
- Plaintiffs alleged potash prices increased sharply from 2003 to 2008 despite relatively stable U.S. demand and excess capacity, supporting an inference of supracompetitive pricing.
- The asserted theory tied foreign coordination to U.S. injury through sales into the United States at cartel-inflated prices and through global “benchmark” pricing affecting U.S. transactions.
- In multidistrict litigation, the district court denied a motion to dismiss and certified an interlocutory appeal; a panel voted to reverse, but the court reheard the case en banc and vacated the panel disposition.

## Issues

1. Whether the Foreign Trade Antitrust Improvements Act (FTAIA) limits subject-matter jurisdiction or instead states substantive elements of a Sherman Act claim.
2. How the FTAIA’s import-commerce carve-out and its requirement of a “direct, substantial, and reasonably foreseeable effect” on U.S. commerce apply to a foreign price-fixing conspiracy.
3. Whether the complaint plausibly alleged conduct within the Sherman Act’s reach, as modified by the FTAIA, sufficient to survive a motion to dismiss.

## Decision

- The en banc court affirmed the denial of defendants’ motion to dismiss and remanded for further proceedings.
- The court held the FTAIA is not jurisdictional; it defines substantive requirements that go to the merits of an antitrust claim.
- The court overruled its prior circuit precedent that treated the FTAIA as jurisdictional.
- The court held the complaint plausibly alleged either import commerce or foreign conduct with a “direct, substantial, and reasonably foreseeable effect” on U.S. commerce that gave rise to plaintiffs’ injury.
- The court concluded plaintiffs stated a plausible Sherman Act § 1 claim at the pleading stage.

## Legal Principles

- The FTAIA generally removes foreign conduct from Sherman Act coverage unless (1) the conduct has a “direct, substantial, and reasonably foreseeable effect” on U.S. domestic or certain export commerce, and (2) that domestic effect gives rise to the plaintiff’s claim.
- The FTAIA does not apply to “import trade or commerce”; price-fixing conduct directed at raising prices for products sold into the United States may fall outside the FTAIA’s exclusion.
- FTAIA compliance is an element of the claim to be evaluated under merits-based procedures (e.g., Rule 12(b)(6) or summary judgment), not as a Rule 12(b)(1) jurisdictional defect.
- For pleading purposes, allegations that foreign producers coordinated to raise prices in an integrated global market and then sold the price-inflated product into the United States can satisfy the FTAIA’s domestic-effects framework and plausibly state a Sherman Act claim.

## Conclusion

The Seventh Circuit, sitting en banc, treated the FTAIA as a merits limitation rather than a jurisdictional bar and held that allegations of a foreign potash cartel selling into U.S. commerce (and causing foreseeable, substantial domestic overcharges) were sufficient to proceed under Sherman Act § 1.


Minn-Chem, Inc. v. Agrium Inc., 683 F.3d 845 (7th Cir. 2012) (en banc)