The first case in which Chinese companies were found guilty under U.S. antitrust law ended Thursday, March 14, with a guilty verdict and fines of $162.3 million.
The two Chinese manufacturers of vitamin C, Hebei Welcome Pharmaceutical Co. Ltd. and North China Pharmaceutical Group Corp., were found guilty of price fixing in a class action suit led by The Ranis Company, a small New Jersey distributor.
Jurors in the case, “In re Vitamin C Antitrust Litigation, U.S. District Court for the Eastern District of New York, No. 06-md-1738”, rejected a rarely-invoked defense called foreign sovereign compulsion doctrine. The case alleged that from 2001 through 2006, the Chinese defendants successfully colluded to artificially and illegally raise the price and restrict the volume of vitamin C exported to the U.S. After more than eight years of discovery and motion practice centered around the defendants' allegations that the Chinese government compelled them to collude to raise prices and restrain production of vitamin C, the case went to trial before a jury in federal court in New York City in February 2013.
"This is the first case where Chinese companies have been sued and found liable under U.S. antitrust law," said Jim Southwick, a Susman Godfrey LLP partner and co-lead counsel in this groundbreaking international price-fixing case. "We are thrilled that the jury soundly rejected the claims of the Chinese vitamin C manufacturers who claimed they were forced into collusion by their government."
Thursday’s verdict immediately follows a settlement earlier this week for $22.5 million with two other Chinese vitamin C manufacturers, Weisheng Pharmaceutical and China Pharmaceutical Group.