HARTFORD FIRE INSURANCE CO. v. CALIFORNIA

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Case Basics
Docket No. 
91-1111
Petitioner 
Hartford Fire Insurance Co.
Respondent 
California
Consolidation 
No. 91-1128
Advocates
(Argued the cause for the petitioners (Merrett Underwriting Agency Management))
(Argued the cause for the respondents in both cases)
(Argued the cause for the petitioners (Hartford Fire Ins.))
(on behalf of the United States, as amicus curiae, supporting the Respondents)
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Facts of the Case 

Nineteen States and many private plaintiffs filed complaints alleging that the defendants -- domestic primary insurers, trade associations, and a reinsurance broker, along with London-based as well as domestic reinsurers -- violated Section 1 of the Sherman Act, 15 U.S.C. Section 1, by engaging in various conspiracies aimed at forcing certain other primary insurers to change the terms of their standard domestic commercial general liability insurance policies. After the actions were consolidated for litigation, the district court granted the defendants' motion to dismiss, holding that the conduct alleged fell within the grant of antitrust immunity contained in Section 2(b) of the McCarran-Ferguson Act, 15 U.S.C. Section 1012(b), and that none of the conduct amounted to a "boycott" within the meaning of the Section 3(b), 15 U.S.C. Section 1013(b), exemption to that grant of immunity. The court of appeals reversed.

Question 

First, did the plaintiffs sufficiently allege "boycotts," as used in the McCarran-Ferguson Act, Section 3(b)? Second, did international comity counsel against exercising Sherman Act jurisdiction over the conduct of the London- based defendants?

Conclusion 
Decision: 5 votes for Hartford Fire Insurance Co., 4 vote(s) against
Legal provision: 15 U.S.C. 1012

Yes to the first; no to the second. The Court, speaking through Justice Antonin Scalia, held that a boycott exists when, in order to coerce a target into certain terms on one transaction, parties refuse to engage in other, unrelated transactions with the target. On most counts, the plaintiffs' allegations, construed favorably, described boycotts. Justice David H. Souter wrote for the Court on jurisdiction over foreign conduct, holding that it was appropriate in this case because there is no true conflict between domestic and foreign law. That is, because the London reinsurers can comply with both British law and the Sherman Act, international comity does not counsel against exercising subject matter jurisdiction in this case.

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HARTFORD FIRE INSURANCE CO. v. CALIFORNIA. The Oyez Project at IIT Chicago-Kent College of Law. 19 June 2014. <http://www.oyez.org/cases/1990-1999/1992/1992_91_1111>.
HARTFORD FIRE INSURANCE CO. v. CALIFORNIA, The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/1990-1999/1992/1992_91_1111 (last visited June 19, 2014).
"HARTFORD FIRE INSURANCE CO. v. CALIFORNIA," The Oyez Project at IIT Chicago-Kent College of Law, accessed June 19, 2014, http://www.oyez.org/cases/1990-1999/1992/1992_91_1111.