A U.S. federal appeals court threw out an antitrust class-action lawsuit accusing seven companies of engaging in a global conspiracy to raise the price of potash, a mineral used mainly in fertilizer.
The 7th U.S. Circuit Court of Appeals in Chicago said the plaintiffs, who were purchasers of potash, did not show a sufficient link between alleged anti-competitive activity outside the United States and the U.S. potash market.
Friday's decision directs the dismissal of claims alleging violations of the Sherman Act, a U.S. antitrust law. It voids the January 2010 refusal by a Chicago trial judge to end the case.
The defendants included Agrium Inc. and Potash Corp. of Saskatchewan Inc., Mosaic Co., and four companies that conduct mining operations in Russia and Belarus: JSC Uralkali, JSC Silvinit, JSC Belarusian Potash and JSC International Potash.
Potash is a key crop nutrient used by farmers worldwide. The plaintiffs accused the defendants of conspiring since 2003 to fix potash prices at artificially inflated levels. As of 2008 the defendants accounted for 71 per cent of global potash supply.
"We were very pleased by the decision, which calls for a complete dismissal," said Stephen Shapiro, a partner at Mayer Brown who argued the case for the potash companies. "The court decided that the law requires dismissal because the complaint failed to allege any substantial or direct connection between the alleged conduct and the United States."
Lawyers for the plaintiffs had no immediate comment or did not immediately respond to requests for comment.
The defendants sought to have the case dismissed on the grounds that a U.S. court had no jurisdiction to review an alleged offshore pricing conspiracy, and that any similarities in price changes by the producers were coincidental.
Writing for the 7th Circuit, Judge Diane Sykes agreed that the case should be dismissed because the plaintiffs' complaint focuses mostly on allegations of wrongful conduct in the Brazilian, Chinese and Indian potash markets.
"Contrary to what the district court seemed to think, it is not enough that the defendants are engaged in the U.S. import market," Sykes wrote. "The complaint offers very little of substance concerning the relationship between the defendants' alleged overseas anti-competitive conduct and the American domestic market for potash."
Reuters