The Coerced Facilitator: Distinguishing Causation from Participation in Hub-and-Spoke Conspiracies

June 01, 2016
Does a vertically-related entity join a horizontal conspiracy simply because its actions were caused by the horizontal conspiracy? A recent U.S. Court of Appeals opinion questionably suggests that the answer is “yes.”

The Fifth Circuit’s opinion in MM Steel v. JSW Steel appeared to conflate causation with participation when it analyzed the liability of a steel mill alleged to have facilitated a horizontal conspiracy among downstream distributors to exclude their new rival. The Fifth Circuit held that, because the horizontal conspiracy among the distributors caused the upstream mill to take an action it otherwise would not have taken, the mill’s conduct was not independent of the horizontal conspiracy, and this supported the jury’s determination that the mill had “joined” the distributors’ conspiracy.

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