{"id":417817,"date":"2026-07-30T09:55:16","date_gmt":"2026-07-30T09:55:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ca\/417817\/"},"modified":"2026-07-30T09:55:16","modified_gmt":"2026-07-30T09:55:16","slug":"californias-antitrust-laws-are-too-irrational-to-spread-to-other-states","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ca\/417817\/","title":{"rendered":"California\u2019s Antitrust Laws Are Too Irrational to Spread to Other States"},"content":{"rendered":"\n

Goldwater Institute lawyers filed a brief<\/a>\u00a0yesterday in the Ninth Circuit Court of Appeals urging the judges not to apply California\u2019s unique (and uniquely bad) antitrust laws to people in other states. The case, which involves that state\u2019s 1907 Cartwright Act, is a class-action lawsuit by purchasers of vaping products who claim that the Altria company tried to engage in monopolistic practices by shutting down production of its own vaping products and buying a competitor. In fact, Altria had legitimate market reasons for what it did, that have nothing to do with monopolization. But more importantly, the class of plaintiffs includes people from a bunch of other states, who did not buy any vaping products in California\u2014but who are trying to use California state law to sue Altria. And that\u2019s a problem because usually state law doesn\u2019t apply beyond the state\u2019s borders.<\/p>\n

Why are the plaintiffs trying to use California law this way? The answer is that California\u2019s state antitrust laws are different from\u2014and far worse than\u2014the federal antitrust laws that one would expect people to use in cases like this. Under federal law, courts typically apply a rule called the \u201cconsumer welfare test,\u201d<\/a> which says the most important goal of antitrust law is to encourage competition\u2014not to protect existing businesses against competition. That test is critical because decades ago, courts sometimes punished successful businesses for doing nothing wrong\u2014indeed, for doing good things, like lowering prices and improving the quality of their products. By adopting the \u201cconsumer welfare test\u201d instead, courts ensured that companies will be more competitive and satisfy customers instead of wasting their time and money suing each other.<\/p>\n

But California\u2019s gone a different way. As we explain in the brief, that state\u2019s courts have said that \u201cconsumer welfare\u201d is not the primary concern when applying California antitrust laws. On the contrary, the Golden State\u2019s antitrust laws protect less competent and less diligent businesses against legitimate competition. Or, as the state supreme court has put it<\/a>, that state\u2019s Cartwright and Unfair Competition laws exist for the \u201csocial\u201d\u2014as opposed to economic\u2014purpose of protecting the \u201cprosperous bourgeois class\u201d against competition by \u201cchain stores.\u201d What that really means is that businesses that cannot lower prices or improve their products can just sue each other, instead.<\/p>\n

And that isn\u2019t just contrary to federal law, but it\u2019s contrary to the laws of other states\u2014including those where the plaintiffs in this case live. Those states have followed the federal courts\u2019 wise lead in prioritizing the consumer over the protection of business interests when applying their state\u2019s economic regulations.<\/p>\n

That means there\u2019s no justification for applying California\u2019s anomalous\u2014indeed, obsolete\u2014legal theories to people located elsewhere. Indeed, because this lawsuit involves people who are \u201csecondary purchasers,\u201d the plaintiffs include people who never even did business with a California company. As antitrust expert Herbert Hovenkamp has written<\/a>, to apply laws across state lines in cases like this would effectively mean that \u201call persons within the limits of the United States could be regulated \u2026 according to the wishes of the legislature of [California].\u201d<\/p>\n

Of course, California is free to choose self-destructive and foolhardy legal theories if it chooses to. But it has no right to inflict those theories on other states, and federal courts should resist efforts to do so.<\/p>\n

You can read our amicus brief here<\/a>.<\/p>\n

Timothy Sandefur\u00a0is the Vice President for Legal Affairs at the Goldwater Institute\u2019s Scharf-Norton Center for Constitutional Litigation.<\/p>\n","protected":false},"excerpt":{"rendered":"Goldwater Institute lawyers filed a brief\u00a0yesterday in the Ninth Circuit Court of Appeals urging the judges not to…\n","protected":false},"author":2,"featured_media":417818,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[86277,7,9,8],"class_list":["post-417817","post","type-post","status-publish","format-standard","has-post-thumbnail","category-california","tag-antitrust","tag-california","tag-california-headlines","tag-california-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/417817","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=417817"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/417817\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/417818"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=417817"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=417817"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=417817"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}