Bill Text: PA HB730 | 2011-2012 | Regular Session | Introduced

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Bill Title: Prohibiting unreasonable restraints of trade; imposing penalties; and providing for enforcement.

Spectrum: Partisan Bill (Democrat 14-0)

Status: (Introduced - Dead) 2011-02-16 - Referred to CONSUMER AFFAIRS [HB730 Detail]

Download: Pennsylvania-2011-HB730-Introduced.html

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PRINTER'S NO. 743
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 730 Session of2011
INTRODUCED BY D. COSTA, DeLUCA, CALTAGIRONE, GEORGE, HARKINS, HORNAMAN, JOSEPHS, KULA, MATZIE, STABACK, STURLA, WHITE AND DALEY, FEBRUARY 16, 2011
REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, FEBRUARY 16, 2011
AN ACT
Prohibiting unreasonable restraints of trade; imposing
penalties; and providing for enforcement.
TABLE OF CONTENTS
Section 1. Short title.
Section 2. Declaration of policy.
Section 3. Definitions.
Section 4. Unreasonable restraints of trade.
Section 5. Penalties.
Section 6. Injunctive relief.
Section 7. Private cause of action.
Section 8. Exemptions.
Section 9. Investigation.
Section 10. Consistency with Federal law.
Section 11. Effective date.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Pennsylvania
Antitrust Act.
Section 2. Declaration of policy.
The General Assembly finds and declares that the purpose of
this act is to promote the public benefits of a competitive
economic environment and to protect the economic welfare of
consumers, businesses and the Commonwealth.
Section 3. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Attorney General." Includes a designated deputy Attorney
General. The term does not include a private attorney or law
firm.
"Business of insurance." That business of insurance
conducted by an insurance company, association or reciprocal,
nonprofit hospital plan corporation, nonprofit professional
health service plan, health maintenance organization, fraternal
benefits society or any risk-assuming preferred provider
organization or nonrisk-assuming preferred provider organization
not governed and regulated under the Employee Retirement Income
Security Act of 1974 (Public Law 93-406, 88 Stat. 829).
"Person." An individual, partnership, corporation,
association or other entity individually or as a part of an
alleged class, or through its officers, agents, employees or
attorneys or those acting in concert with the person. The term
includes a political subdivision.
"Political subdivision." Includes an agency, a board, a
commission or an authority of a political subdivision.
"Reasonable cause to believe." The totality of facts and
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circumstances sufficient to warrant belief by a person of
reasonable caution that further investigation is necessary. The
term does not require the Attorney General to establish probable
cause or a prima facie case.
"Trade secret." Anything which constitutes, represents,
evidences or records secret or confidential scientific,
technical, merchandising, production, management or commercial
information.
Section 4. Unreasonable restraints of trade.
A contract, combination or conspiracy in restraint of trade
or commerce in this Commonwealth is unlawful.
Section 5. Penalties.
(a) Criminal penalty.--
(1) A partnership, corporation, association or other
entity which violates section 4 commits a felony of the third
degree and shall, upon conviction, be sentenced to pay a fine
of not more than $1,000,000.
(2) An individual who violates section 4 commits a
felony of the third degree and shall, upon conviction, be
sentenced to pay a fine of not more than $100,000 or to
imprisonment for not more than three years, or both.
(b) Enforcement.--The Attorney General shall have standing
and authority to prosecute an action for a criminal penalty.
(c) Alternative civil penalty.--In lieu of criminal
prosecution under subsection (b), the Attorney General may elect
to bring an action for a civil penalty. In an action under this
subsection:
(1) An individual who violates section 4 shall be liable
for a penalty of not more than $100,000 for each violation
and for the cost of suit, including reasonable attorney fees.
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(2) A partnership, corporation, association or other
entity which violates section 4 shall be liable for a penalty
of not more than $1,000,000 for each violation and for the
cost of the suit, including reasonable attorney fees.
(d) Factors to be considered.--In determining the
appropriate sanctions to be imposed under this section, the
court shall consider at least the following factors:
(1) The prior criminal record of the violator.
(2) The size and amount of the contract involved, if
any.
(e) Disposition of fines and penalties.--Criminal fines and
civil penalties collected under this section shall be paid into
the State Treasury.
(f) Limitation of action.--An action under this section must
be commenced within four years after the violation of this act
is committed.
(g) Double jeopardy.--A criminal prosecution or an action
solely for a civil penalty under this section may not be brought
against a person previously charged by information or indictment
with a criminal violation of 62 Pa.C.S. Ch. 45 (relating to
antibid-rigging), or of a Federal antitrust statute, if the
prosecution is based upon substantially the same conduct upon
which a prosecution under this section could be based and
jeopardy has attached under the prosecution.
(h) Other actions.--An action under this section does not
bar administrative sanctions, a civil action for injunctive
relief under section 6 or a civil action for damages or
injunctive relief under section 7.
Section 6. Injunctive relief.
(a) Action by Attorney General.--The Attorney General may
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bring a civil action against any person to restrain the conduct
prohibited by this act.
(b) Commencement of action.--An action under this section
must be commenced within four years after the violation of this
act is committed.
Section 7. Private cause of action.
(a) Cause of action.--
(1) A person directly injured in business or property as
a result of an act prohibited by this act shall have a right
to bring a civil action for damages or injunctive relief.
(2) The Commonwealth, whether a direct or indirect
purchaser, when injured in its business or property as a
result of an act prohibited by this act, shall have the right
to bring a civil action for damages or injunctive relief. In
an action by the Commonwealth as an indirect purchaser, the
court shall take necessary steps, including transfer and
consolidation, to avoid duplicate liability for the same
injury.
(3) Neither the Commonwealth nor any person may maintain
or continue to maintain a civil action under this act based
on any transactions or occurrences if a final judgment as to
which all appeals have been exhausted has been entered in an
action by or on behalf of the Commonwealth or of the person,
under the antitrust laws of the United States or another
state for injury arising from the same transactions,
occurrences or circumstances.
(b) Limitation of action.--A cause of action arises under
this section at the time the conduct in violation of this act is
discovered or should have been discovered or, for a continuing
violation, at the time the latest violation of this act is
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discovered or should have been discovered. An action under this
section must be brought within four years of the date when the
cause of action arises. During the pendency of an action under
section 5 and for one year after the action is completed, the
limitation under this subsection is tolled if the action under
this section is based in whole or in part on any matter
complained of in the action under section 5. If the running of
the statute of limitations in respect of a cause of action
arising under this section is tolled under this subsection, any
action to enforce that cause of action shall be barred unless
commenced either within the period of suspension or within four
years after the cause of action accrued.
(c) Damages.--Damages recoverable under this act by the
Commonwealth and by any person shall be actual damages sustained
plus the cost of suit, including reasonable attorney fees. If
the circumstances warrant, damages recoverable under this act by
any person may be three times the actual damages sustained plus
taxable costs and reasonable attorney fees. Damages are subject
to the following:
(1) Neither the Commonwealth nor any person shall be
awarded any damages, including treble damages, if a court of
another jurisdiction has already entered judgment on a claim
by the Commonwealth or the person arising out of the same
transaction or occurrence.
(2) If the conduct which gives rise to a violation of
this act also gives rise to a violation of 62 Pa.C.S. Ch. 45
(relating to antibid-rigging), the amount awarded as civil
damages or compensation under this act shall not duplicate
the amount awarded under 62 Pa.C.S. Ch. 45.
(d) Costs in injunction actions.--In an injunction action in
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which the plaintiff substantially prevails, the court shall
award the cost of suit, including reasonable attorney fees.
(e) Liability.--Liability under this section shall be joint
and several. Persons subject to liability under this act shall
be entitled to contribution in accordance with 42 Pa.C.S. Ch. 83
Subch. B (relating to contribution among tort-feasors).
(f) Notice to Attorney General.--Within ten days of filing a
complaint under this section, the plaintiff shall serve a copy
of the complaint upon the Attorney General by registered mail. A
copy of the certificate of service shall be filed with the
court.
(g) Collateral estoppel.--A criminal conviction for a
violation of section 4 shall be prima facie evidence as to
liability of the convicted participants in a civil action under
this section. This subsection does not apply to pleas of no
contest or to consent decrees. Nothing contained in this
subsection shall be construed to impose a limitation on the
application of collateral estoppel.
(h) Authority of Attorney General.--The Attorney General has
authority under this section:
(1) To bring all actions on behalf of the Commonwealth.
(2) To bring an action as parens patriae on behalf of
individuals who:
(i) have suffered an injury to their property by
reason of a violation of this act; and
(ii) resided in this Commonwealth when the violation
occurred.
(3) To bring an action on behalf of a political
subdivision, if requested to do so by the political
subdivision.
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Section 8. Exemptions.
(a) Sovereign immunity.--The Commonwealth shall not be
liable in actions under this act. Commonwealth officials and
employees acting in their official capacities shall not be
liable for penalties under section 5 or for damages, costs and
attorney fees under section 7.
(b) Governmental and official immunity.--Political
subdivisions shall not be liable in actions under this act.
Officials and employees of political subdivisions acting in
their official capacities shall not be liable for penalties
under section 5 or for damages, costs and attorney fees under
section 7.
(c) State action.--Conduct which results from a clearly
articulated and affirmatively expressed State policy and which
is actively supervised by the Commonwealth shall not constitute
a violation of this act.
(d) Labor organizations.--The existence and operation of a
labor organization and the exercise of lawful activities of a
labor organization shall not constitute a violation of this act.
(e) Cooperative associations.--The collective activities of
an agricultural or a horticultural cooperative association to
process, prepare for market, handle and market members'
products, whether or not the activities restrain competition
among the members of the association, shall not constitute a
violation of this act.
(f) Business of insurance.--This act does not apply to the
business of insurance to the extent that the business:
(1) is regulated by the Insurance Commissioner; and
(2) does not constitute a boycott, coercion or
intimidation or an agreement to boycott, coerce or
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intimidate.
(g) Public utilities.-- This act does not apply to
activities of, or to the rates charged by, an electric
cooperative corporation, as defined in 15 Pa.C.S. Ch. 73
(relating to electric cooperative corporations), or a public
utility, as defined in 66 Pa.C.S. § 102 (relating to
definitions), to the extent that those activities or rates are
subject to the review of the Pennsylvania Public Utility
Commission or a comparable Federal agency. Upon the filing of a
complaint against a public utility under this act, the public
utility may request from Commonwealth Court a declaratory order
outlining the extent to which the activity or rates subject to
the complaint are subject to the review of the commission; or,
if the public utility's conduct or activities are subject
primarily to the jurisdiction of a comparable Federal agency,
the public utility may request from that agency a declaratory
order outlining the extent to which the activity or rates
subject to the complaint are subject to the review of the
comparable Federal agency. This public utility exemption is in
addition to other exemptions granted to public utilities in this
act.
(h) Regulated financial institutions.--This act does not
apply to any institution subject to the Bank Holding Company Act
of 1956 (70 Stat. 133, 12 U.S.C. § 1841 et seq.); section 10 of
the Home Owners' Loan Act (48 Stat. 128, 12 U.S.C. § 1467a); the
Bank Merger Act (Public Law 86-463, 74 Stat. 129); the Federal
Deposit Insurance Act (64 Stat. 873, 12 U.S.C. § 1811 et seq.);
18 U.S.C. §§ 215 (relating to receipt of commissions or gifts
for procuring loans) and 709 (relating to false advertising or
misuse of names to indicate Federal agency); the act of November
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30, 1965 (P.L.847, No.356), known as the Banking Code of 1965;
or the act of December 14, 1967 (P.L.746, No.345), known as the
Savings Association Code of 1967.
(i) Federal or State exempt activities.--Activity or conduct
authorized by or exempt from Pennsylvania statutory or common
law, or exempt from the provisions of the antitrust laws of the
United States, shall be exempt from the provisions of this act.
This section shall specifically apply to any activity or conduct
authorized by the board of the Ben Franklin Partnership Fund, as
authorized by the act of July 2, 1993 (P.L.439, No.64), known as
the Ben Franklin/IRC Partnership Act. Any activity or conduct
subject to any other Federal statute which limits, modifies or
otherwise affects the applicability of one or more provisions of
the Federal antitrust statutes, or Federal judicial opinions
interpreting those statutes, shall, to that extent, be exempt
from this act.
(j) Not-for-profit health care facilities.--Any agreement or
conduct by a not-for-profit health care facility, which reduces
health care costs and passes the reductions on to consumers,
shall not constitute a violation of this act.
Section 9. Investigation.
(a) General power.--If the Attorney General has reasonable
cause to believe that a violation of this act has occurred, the
Attorney General has authority to investigate on behalf of the
Commonwealth, its citizens or a political subdivision.
(b) Attendance and production of documents.--Prior to the
institution of a civil action, the Attorney General is
authorized to require the attendance and testimony of witnesses
and the production of documents. Prior to the issuance of a
subpoena under this section, the Attorney General must make a
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request for information. A request for information must state
the subject matter of the investigation, the conduct
constituting the alleged violation which is under investigation
and the provisions of this act applicable to the alleged
violation. A request for documentary material must describe the
material to be produced with reasonable particularity so as to
fairly identify the documents demanded, provide a return date
within which the material is to be produced and identify the
member of the Attorney General's staff to whom the material
shall be given. For this purpose, the Attorney General may issue
subpoenas, examine witnesses and receive evidence. If a person
objects to or otherwise fails to comply with a subpoena or
request for testimony, the Attorney General may file in
Commonwealth Court an action to enforce the subpoena or request.
Notice of hearing the action and a copy of all pleadings must be
served upon the person, who may appear in opposition.
(c) Confidentiality.--
(1) Any testimony taken or material produced shall be
kept confidential by the Attorney General except that the
Attorney General may use that information:
(i) in a judicial proceeding;
(ii) if the disclosure is authorized by the court
for good cause shown; or
(iii) if confidentiality is waived by the person
being investigated and by the person who has testified,
answered interrogatories or produced materials.
(2) At the Attorney General's discretion, the Attorney
General may disclose information discovered under this
section to the United States Department of Justice, the
Federal Trade Commission, another state or territory of the
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United States or another agency of the Commonwealth, upon the
prior certification of an appropriate official of the
recipient that the information will be maintained in
confidence other than use for official purposes and that the
recipient will abide by the provisions of paragraph (1).
Trade secrets may not be disclosed by the Attorney General
without the approval of Commonwealth Court, after notice to
the person who produced the information.
(3) The Attorney General may use information, including
documents, obtained under this section in an action brought
under this act or Federal antitrust statutes; however,
information relating to trade secrets may not be made public
in an action without the approval of the court in which the
action is pending, after notice to the person who produced
the information.
(d) Limitation on use.--No criminal prosecution under this
act may be brought by the Attorney General based principally
upon information or documents obtained in a civil investigation
under this section.
(e) Wrongful disclosure of information.--A person who
publishes or communicates any procedure, testimony or material
produced, which is required to be kept confidential under this
section, commits a misdemeanor of the third degree.
Section 10. Consistency with Federal law.
The provisions of this act which parallel provisions of
Federal antitrust statutes shall be construed consistently with
pertinent Federal statutes and Federal judicial opinions
interpreting those Federal statutes.
Section 11. Effective date.
This act shall take effect July 1, 2011.
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