Legal action to be taken against increase of bread price
How to Take Legal Action Against Price Fixing
In the United States, price fixing occurs when competitors enter into an agreement to maintain, raise, or lower the price of goods or competitive terms. Under federal and state antitrust laws, the act of price fixing is illegal.Once you identify a price fixing scheme, you have the ability to take legal action against the price fixers. If you believe competitors are breaking state law, you can contact your state attorney general's office. If the competitors might be breaking federal antitrust laws, you can reach out the the Federal Trade Commission (FTC) or the Department of Justice (DOJ). Additionally, most state and federal antitrust laws allow you to bring a private action against the competitors for monetary damages and injunctions.
Identifying Potential Price Fixing Schemes
Look for common practices.Price fixing occurs when two or more competitors enter an agreement to tamper with prices or terms and conditions of sale. Price fixing can take place at any level where commodities or services are being offered. For example, it would be considered price fixing if executives from Companies A, B, and C (all selling televisions) got together and agreed that no company should sell their televisions for less than ,000.While one of the most common forms of price fixing is an agreement to raise the price of a good or service, other common forms of price fixing include:
- Agreements to establish uniform price discounts
- Agreements to get rid of discounts for certain products or for certain consumers
- The creation of a formula that multiple competitors will use to set the price of a good or service
- Agreements about the terms and conditions of sale (e.g., freight charges and bulk discounts)
- Agreements to not advertise the price of a good or service
Determine if a written agreement exists.When competitors enter into a written agreement to fix prices, it is almost always illegal. A written agreement would usually take the form of a contract that would lay out exactly how the companies involved would change their actions in order to effect a price change.
- However, written agreements to fix prices rarely exist. Businesses know that price fixing is illegal so they will try to hide it. If they create a written agreement, not only would it be unenforceable, but it would also create a paper trail that businesses do not want to exist.
Collect circumstantial evidence.In reality, price fixing takes place behind closed doors, in secret, through the use of verbal agreements and by conduct. This makes it very difficult to uncover businesses that price fix. However, the law recognizes this and allows you to use circumstantial evidence to build a case against price fixers. Examples of useful circumstantial evidence would include:
- Invitations to coordinate prices (e.g., one competitor asks another competitor to end a price war by stating what a reasonable price for their goods may be). This information, while difficult to obtain, is most often gotten from employees working for one of the two or more companies involved in the price coordination. This evidence usually pops up in whistleblower cases.
- Patterns of unexplained identical contract terms or pricing behaviors between competitors (e.g., the price of gas at two neighboring stations is always the same).
- Records of price changes.
- Company memoranda discussing price analyses.
- Recordings of competitor meetings or telephone calls.
Talk to company employees.In most cases of price fixing, state and federal investigations, as well as your private suit, will not go very far if you do not have the help of an employee working within one of the companies.This employee will need to be able to testify about what they saw while working and how it relates to price fixing.
- If you think a company is taking part in a price fixing scheme, try reaching out to a trusted employee who might know about it. However, reaching out to an employee can also be risky. If the employee turns on you, they might tip off the company they work for. If this happens, the company might cover their tracks and make it even more difficult for you to uncover some illegal action.
- If you are an employee or some other insider, the United States will protect you if you come forward, as a whistleblower, with a claim of price fixing. Under the False Claims Act, you will be able to remain anonymous while the government investigates your claim.If you think you should be afforded whistleblower protection, contact a lawyer before you file any complaints.
Recognize the existence of normal market conditions.Not all similarities in pricing exist because of price fixing. A lot of times, competitors will charge similar prices for their goods because it makes good business sense. For example, the price of commodities (e.g., wheat) are often identical because the products are almost identical. The price of those commodities rise and fall together based on market forces and not because of agreements among competitors.
Supplying Information to Your State Attorney General
Understand how state antitrust laws are enforced.State and federal antitrust laws, which include price fixing laws, help ensure that businesses compete in an open and free market and that consumers pay a price for goods that reflect supply and demand. Antitrust laws recognize that when competition is reduced, the price of goods normally rises. At the state level, antitrust laws usually mirror federal laws. Each state's antitrust laws definitely outlaw price fixing.
- State antitrust laws are enforced by each state's office of the attorney general. The attorney general's office investigates and prosecutes violations when they arise. The attorney general of each state represents the citizens of that state as well as the state as a whole.
- One of the most common ways the attorney general's office becomes aware of price fixing schemes is through citizen reports.
- To find out how to report a suspected price fixing scheme, visit your state attorney general's website.
Determine how antitrust complaints are submitted.Start by visiting your state's attorney general website. Once there, find your way to the complaint page, which every state website should have. Read about your state's complaint process, which should include what needs to be in a complaint, where a complaint must be filed, and how it will be handled.
- In general, state antitrust complaints are accepted online, by mail, and by email. Some states will have interactive complaint pages (e.g., Washington) while others (e.g., New York) will provide you with forms you can fill out on your own.
Draft a complaint.Each state will request slightly different information on their complaint forms and websites. In general, the complaint will start with you providing your personal information. This will include your name, address, and contact information. Next you will provide contact information for the company you are complaining about.
- The body of your complaint will then identify the alleged price fixing scheme and details about the evidence you have. Some complaint forms will also ask whether you have contacted your own lawyer, filed your own lawsuit, or whether you have any documents evidencing the price fixing.
Submit your complaint.Once your complaint has been completely filled out, you can email it or mail it to the address provided by the attorney general's office. If you are allowed to submit it through the attorney general's website, you can simply click the "submit" button once you are done.
- Be aware that your complaint will likely become public record once you submit it. This means the information you provide will be accessible to the public and they will be able to see it if they search for it.
Follow up on your complaint.Once your complaint has been submitted, it will be reviewed in the order it was received. Even in a smaller state like New Hampshire, the attorney general's office can receive over 3,000 complaints each year. Once your case has been processed (usually within about four weeks), you will receive a confirmation message and you will be given a reference number. You will use this number whenever you contact the attorney general's office to talk about your complaint.
- When your complaint is reviewed, it will be looked at by paralegals and lawyers who will determine if it has merit. If it does, you may be told to hire a private lawyer, your complaint may be forwarded to another agency, or the complaint may lead to an enforcement action by the attorney general's office.
- In most state attorneys general cases, your complaint, if valid, will turn into an investigation and possibly a lawsuit. However, you will usually not be involved past the complaint stage unless you are asked to testify at a trial.
Reporting an Antitrust Violation to the Federal Trade Commission
Go to the FTC's Bureau of Competition website.When federal antitrust laws are at issue, you will need to report to a federal agency. One of the main federal enforcement agencies is the FTC's Bureau of Competition. The Bureau of Competition has the power to investigate complaints and bring federal lawsuits against alleged lawbreakers. The FTC will handle most of the administrative complaints and complaints that lead tocivillitigation. They will consult with the DOJ's Antitrust Division before opening any investigation.
- To start the FTC complaint process, visit the Competition Bureau's reporting website.
Write a complaint.The FTC Bureau of Competition does not have a form for reporting alleged antitrust violations. Therefore, you will need to create your own complaint. Your FTC complaint must describe your concern in detail. Do not forget to provide your personal information, which should include your phone number. Additionally, it should answer the following questions:
- What entity is engaging in the conduct you believe violates federal antitrust law?
- How do you believe the entity is violating federal antitrust laws (i.e., are they price fixing)?
- How do you fit in (i.e., are you a consumer, employee, competitor)?
Send your complaint.Once you have drafted your report, it needs to be mailed or emailed to the FTC. If you are mailing your report, send it to the Office of Policy and Coordination, Room CC-5422, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580. If you are emailing your report, send it to .
- Be aware that sending an email is not secure. Therefore, if you have any confidential information that will accompany your report, you need to send it through the regular mail and mark it as "confidential".
- Once you report alleged price fixing at the federal level, your job will usually be done. In most cases, the FTC will review your report and decide how to proceed on their own. If your report is valid, the FTC or another agency will conduct their own investigation and collect their own evidence to use in an enforcement action.
Sending a Complaint to the Department of Justice (DOJ)
Navigate to the DOJ's Antitrust Division website.The DOJ's Antitrust Division investigates possible federal antitrust violations in much the same way the FTC does. However, while the FTC will handle most of the civil claims, the DOJ will handle allcriminalinvestigations.If you think you have uncovered a major case of price fixing, go to the DOJ's Antitrust Division website to start the complaint process.
Click on "Report Violations".Once you click on the "Report Violations" link on the left side of the Antitrust Division homepage, you will be taken to a page that describes the complaint process. Read the directions carefully.
Describe your concerns.The DOJ does not have a form to fill out when filing an antitrust complaint. Therefore, you will have to create your own complaint using some word processing application on your computer. You can also write your complaint legibly in pen. Your complaint, in order to be considered complete, needs to answer the following questions:
- What are the names of all the entities involved?
- How do you believe the antitrust laws have been violated?
- Can you provide any examples of the conduct you think violated antitrust laws?
- What product or service is affected by your price fixing allegation?
- Who are the major competitors in the business arena where you think price fixing is taking place?
- What is your role in everything?
- Who has been harmed and how have they been harmed by the price fixing?
Submit your letter to the Citizen Complaint Center (CCC).Once you answer the questions, you can submit your complaint through the mail, by email, or over the phone. If you are sending in your complaint, address it to the Citizen Complaint Center, Antitrust Division, 950 Pennsylvania Avenue, NW, Room 3322, Washington DC 20530. If you are emailing your complaint, you can send it to . If you want to call in your complaint you can dial 1-888-647-3258 or 202-307-2040.
Follow up as necessary.After your complaint has been submitted, the CCC will create a record of the information you provided and they will review it for possible antitrust violations. If your complaint is valid, the CCC will forward it to the appropriate agency where an investigation will take place. If the CCC needs more information, they will contact you.
- Because Antitrust Division investigations are confidential, you will not be informed if and when an investigation is opened.
- As with the other reporting options, your job will usually be done after your complaint is submitted. In general, federal and state agencies will use your information as the basis for starting an investigation. However, your complaint will not usually provide sufficient evidence to bring an action at the outset.
Bringing a Private Lawsuit
Gather evidence of the price fixing.The government has incentivized private antitrust enforcement by allowing citizens to bring private lawsuits against companies who have allegedly violated antitrust laws. If you choose to bring a private lawsuit against an entity you think is liable for price fixing, you may be able to get an injunction and collect monetary damages, attorneys fees, and treble damages.However, price fixing lawsuits can be incredibly difficult to win and most of the time, the entities you are suing will have millions of dollars to spend on legal defenses. Therefore, before you bring a private antitrust lawsuit, you need to have your ducks in a row.
- Once you identify the price fixing, gather witness statements, employee notes, internal memoranda, written agreements, and notes from internal conversations.
- Private lawsuits are most often brought by competitors of companies involved in price fixing and companies and individuals that use the services of companies that are accused of price fixing. For example, a gas station (i.e., a competitor) might sue for price fixing if they notice two or more gas stations in their area might be price fixing. In another example, a railroad company (i.e., consumer) might sue two or more fuel providers alleging price fixing, due to the increased cost of fuel the railroad company has to pay.
Hire a lawyer.As soon as you think you have enough evidence to move forward, contact a qualified business lawyer specializing in litigating price fixing antitrust lawsuits. If you plan on suing in federal court, you will need a lawyer who specializes in federal litigation. On the other hand, if you plan on filing in state court, you need a lawyer who specializes in state antitrust litigation. Start your lawyer search by asking friends and family for recommendations.
- If you cannot get any solid recommendations, contact your state bar's lawyer referral service. After answering a few questions, you will be put in contact with various qualified lawyers in your area.
Review antitrust statutes.Under federal law (the Clayton Act of 1914), you can recover damages if you are a person injured in your business or property due to someone else's violation of antitrust law. If successful, you will be able to collect triple damages as well as attorneys fees. In addition, if you are threatened with a loss or damage due to an antitrust law violation, you can ask the court for an injunction, which will force the entity you are suing to stop what they are doing.
- Most state laws mirror federal antitrust laws. However, some states limit the amount of money you can recover and limit lawsuits to only those cases that are particularly egregious.
- Because of the way the law is written, most, if not all, private suits are brought by competitors or consumers. It would be very difficult for a generally concerned citizen to prove the type of injury that is necessary to succeed in court.
Assess your standing to sue.To get into federal court, you must have standing to sue. In federal antitrust cases, you must be able to show an actual injury to your property or business that the antitrust laws were intended to prevent. Additionally, you must be able to show that your injury is not too remote from the violation (e.g., indirect purchasers are usually considered too remote to claim damages). However, if you are only asking for an injunction, the injury you claim can include threatened loss or damage, and the remoteness requirement is relaxed as well.
- As you can see, the standing requirement will keep a lot of plaintiffs out of court. In order to get through this initial checkpoint, you, as the plaintiff, will have to show that you were directly injured by the price fixing. This usually means you will either be a competitor who is being pushed out of the market or a consumer who is having to pay outrageous prices.
- Your lawyer will go into more detail about standing and will ask you questions that will help them determine if you will meet the test.
Determine if the statute of limitations has passed.Under federal law, if you want to file a private action against an entity for price fixing, you must bring your suit within four years of the date you suffered your injury. If your injuries are too speculative to prove, your four year lime limit will not start until your injuries become provable. In addition, if the entity you plan on suing is continuing to break antitrust laws, each instance of price fixing will start a new clock.
File a complaint.If your lawyer believes you have a strong case against an entity you think is price fixing, your lawyer will file a complaint in court. A complaint is a formal legal document that starts a lawsuit. Your complaint will set out why the court can hear your case, what you are accusing the defendant of doing, and what relief you are seeking.
- Successful private actions require a lot of resources and evidence. If you are at the point where you believe you and your lawyer can file a complaint, it means you have gathered evidence of the price fixing and you believe you can prove your injury.
Serve the defendant.Once you have filed a complaint, the clerk of courts will sign and stamp a summons form. You will have the responsibility of notifying the defendant of your case against them by handing them a copy of your complaint and summons. This process is calledservice. In most cases, you will not be able to serve the defendant on you own. Instead, you will have to hire someone over the age of 18 who is unrelated to the case. You can also hire the sheriff's office (if you are in state court) or the Marshal's Service (if you are in federal court).
Examine the defendant's response.After the defendant reads your complaint, they will respond to it by filing an answer with the court. The defendant's answer will also be served on you. The answer will respond to all of your allegations and will contain certain defenses as well. This document is a great source of information and will inform you about how the defendant plans to try and defeat your case.
- Read the answer carefully so you can determine the best way to proceed with litigation.
Litigating Your Case
Take part in discovery.Early in the pretrial process you will take part in discovery, which gives both parties the opportunity to collect information about the case in order to prepare for trial. During discovery you will collect facts, interview witnesses, determine the strength of your case, and see what the other side is going to say at trial. In order to accomplish these things, you will use the following tools:
- Depositions, which are formal in-person interviews with witnesses and parties. The interviews are conducted under oath and the answers given can be used in court.
- Interrogatories, which are written questions posed to witnesses and parties. The responses must be written under oath and can be used in court.
- Requests for documents, which are formal requests for physical items related to the case. This tool helps you get your hands on documents you may not be able to find otherwise. For example, you might ask for text message exchanges, phone records, email threads, internal memos, and written contracts.
- Requests for admissions, which are written statements the defendant will have to admit or deny. These admissions help narrow the focus of litigation.
Oppose any motion for summary judgment.Once discovery concludes, the defendant will usually try to end the litigation immediately and have the judge rule in their favor. The defendant will do this by filing a motion for summary judgment. To be successful, the defendant will have to prove that there are no genuine issues of material fact and that they are entitled to judgment as a matter of law. In other words, the defendant will have to persuade the judge that, even if every factual assumption was made in your favor, you would still lose.
- To defend against this motion, you will file a response. Your response will contain evidence and affidavits proving that there are factual disputes that need to be resolved during a trial. You will be successful, and the litigation will continue, if you can persuade the judge that there is a chance (no matter how small) that you will win at trial.
Attempt to settle.Trials can be incredibly expensive and time consuming. Before you go down that road, try to settle your dispute with the defendant. This is an ideal time to try because you will have collected evidence during discovery that will help you negotiate. In addition, you will have a good idea of what the judge is thinking based on how they responded during the summary judgment proceedings. Start settlement discussions informally by sitting down and talking with the defendant. If the negotiations are unsuccessful, try alternative dispute resolution methods.
- For example, ask the defendant if they will take part in mediation. During mediation, you and the defendant will sit down, together, with a mediator. The mediator will try to find common ground and work out unique solutions to your disputes. The mediator will not inject their own opinions and they will not take sides.
- If mediation does not lead to a resolution, try non-binding arbitration. During arbitration, a judge-like arbitrator will listen to each party present their case. After the presentations are done, the arbitrator will draft a written opinion, which will lay out who has the stronger case and what remedies might be available to the winning side. If both parties agree with the arbitrator, they can bind themselves to the opinion.
Hire expert witnesses.Due to the complex nature of price fixing lawsuits, you will most likely need to hire expert witnesses to help make your case in court. Expert witnesses present opinions about the facts of your case. These witnesses will help the judge and/or jury understand the case and rule in your favor. Expert witnesses are different from lay witnesses because of their qualifications based on experience, knowledge, skill, education, and training.
Go to trial.If you and the defendant end up going to trial, you will have to present your case to a judge and possibly a jury. As the plaintiff, you will be given the opportunity to present evidence first. Your lawyer will do this by examining witnesses and presenting physical evidence. Once your lawyer has rested, the defendant will get to present their case. At the conclusion of the trial, the judge, and jury if you have one, will deliberate and come up with a resolution to your case. The resolution will be read in court. If you win, you will receive a remedy that might include injunctive relief and/or monetary damages.
- If you lose, you might be able to appeal the judge's decision to a higher court. Appeals are only available if the judge made a legal mistake that affected the outcome of the case. If you think this might be an option, talk with your lawyer as soon as possible. In most cases, you will only have about 30 days to file your notice of appeal.
- While this article focuses on the laws of the United States, laws in other countries tend to be similar. Consult a lawyer or relevant governmental entity if you have questions about price fixing in your own country.
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