Takeaway
In short, Aguilar confirms that California summary judgment requires evidence, not pleading or speculation, and that an antitrust plaintiff must offer proof making collusion more likely than lawful independent behavior before a conspiracy claim may go to trial.
Theresa Aguilar brought a statewide consumer class action against major petroleum companies, alleging that they conspired to restrict the output of California Air Resources Board (CARB) gasoline and raise its price after California required the cleaner-burning gasoline formulation. Her principal claim alleged a per se unlawful horizontal conspiracy under the Cartwright Act; her related unfair-competition claim rested on the same alleged conspiracy.
The companies moved for summary judgment after extensive discovery. They submitted declarations and other evidence describing independently made capacity, production, and pricing decisions. Aguilar relied on evidence of industry information exchanges, common consultants, exchange agreements among refiners, spot-market activity, and expert opinions. The superior court initially granted summary judgment, finding the evidence consistent with independent, procompetitive responses to CARB-gasoline regulation rather than collusion.
On Aguilar's new-trial motion, the superior court concluded it had misapplied an earlier Court of Appeal decision, Biljac, and granted a new trial. The Court of Appeal reversed, holding that the companies were entitled to summary judgment. The California Supreme Court granted review to clarify California summary-judgment law generally and the standard for antitrust-conspiracy claims specifically.
Issue #1
Whether an order granting a new trial after summary judgment is appealable.
Holding
Yes. An order granting a new trial is appealable even when it effectively vacates a summary judgment and functions much like a denial of summary judgment.
Reasoning
Aguilar properly sought a new trial after the superior court granted summary judgment, and the court's resulting order formally granted a new trial. Code of Civil Procedure section 904.1 makes any order granting a new trial appealable.
The practical effect of the order did not alter its appealability. Although it restored the case for further proceedings and therefore resembled a nonappealable denial of summary judgment, it remained an appealable new-trial order. Aguilar could not recast it as a nonappealable order merely to defeat appellate jurisdiction.
Issue #2
What standard of review applies when a new-trial order rests solely on the trial court's asserted legal error in granting summary judgment.
Holding
Independent, or de novo, review applies.
Reasoning
New-trial orders are generally reviewed for abuse of discretion, but the governing standard depends on the determination underlying the order. Here, the only basis for the new-trial order was the court's conclusion that its prior summary-judgment ruling rested on legal error.
A summary-judgment ruling is reviewed independently, and the interpretation and application of precedent present legal or predominantly legal questions. The Court of Appeal therefore properly reviewed de novo whether the superior court had correctly granted summary judgment and correctly understood Biljac.
Issue #3
What burdens govern a California motion for summary judgment after the 1992 and 1993 amendments to Code of Civil Procedure section 437c.
Holding
The moving party always retains the burden of persuasion, but an initial burden of production shifts to the opposing party once the movant makes a prima facie showing that no triable material issue exists.
Reasoning
A summary judgment is proper only if the moving party persuades the court that there is no triable issue of material fact and that the party is entitled to judgment as a matter of law. A fact is triable only if the evidence would permit a reasonable trier of fact to find for the opposing party under the substantive standard of proof applicable at trial.
The moving party first has a burden of production to make a prima facie showing that no triable issue exists. If that showing is made, the opposing party must produce specific evidence sufficient to make a prima facie showing of a triable issue; allegations and denials in pleadings do not suffice.
The burdens reflect the proof allocation at trial. A plaintiff who bears the trial burden by a preponderance must offer evidence from which a reasonable factfinder would have to find the material fact more likely than not. A defendant may obtain summary judgment by showing that the plaintiff cannot establish at least one element or that a complete defense exists.
Issue #4
Whether a defendant moving for summary judgment must conclusively negate an element of the plaintiff's claim, and whether it may rely on argument alone that the plaintiff lacks evidence.
Holding
No conclusive negation is required, but a California defendant must support its motion with evidence; it cannot merely argue that the plaintiff lacks evidence.
Reasoning
The 1992 and 1993 amendments eliminated the former requirement that a defendant conclusively negate an element of the plaintiff's cause of action. A defendant need only show that one or more elements cannot be established, which may include showing that the plaintiff lacks, and cannot reasonably obtain, the evidence needed to prove an element.
California procedure nevertheless differs from federal procedure in an important respect. Section 437c requires the moving defendant to support its motion with admissible evidence, such as declarations, admissions, interrogatory answers, depositions, or judicially noticeable matters; bare argument pointing out an asserted evidentiary gap is insufficient.
This framework serves the central purpose of summary judgment: when no reasonable factfinder could return a verdict for the party bearing the trial burden, a court should end the case rather than require a futile trial that would culminate in nonsuit, directed verdict, or a comparable disposition.
Issue #5
What must an antitrust plaintiff show to defeat summary judgment on a Cartwright Act claim alleging a horizontal conspiracy to restrict output or raise prices.
Holding
The plaintiff must produce evidence permitting a reasonable jury to find conspiracy more likely than independent action; evidence equally consistent with lawful competition and collusion is insufficient, and the evidence must tend to exclude independent action.
Reasoning
Because Aguilar would bear the burden at trial to prove the alleged Cartwright Act conspiracy by a preponderance of the evidence, she had to produce evidence from which a reasonable jury could find collusion more likely than not. The Court adopted the reasoning of Matsushita under analogous federal antitrust law.
Ambiguous conduct and inferences do not meet that standard when they are as consistent with lawful, independent competition as with illegal agreement. Permitting cases to reach trial on that basis would risk chilling procompetitive conduct through the cost and burden of antitrust litigation.
The plaintiff need not conclusively eliminate every possibility of independent conduct. But the evidence, considered as a whole and in the plaintiff's favor, must tend to exclude the possibility that the defendants acted independently rather than through an unlawful agreement.
A court may not weigh competing evidence as a factfinder. If the plaintiff's evidence and reasonable inferences would permit a jury to find conspiracy more likely than lawful independent conduct, summary judgment must be denied despite contrary defense evidence. If the plaintiff's proof shows collusion only as likely as lawful competition, or less likely, no triable issue exists.
Issue #6
Whether the petroleum companies were entitled to summary judgment on Aguilar's Cartwright Act conspiracy claim.
Holding
Yes. The companies made a prima facie showing of independent conduct, and Aguilar's evidence did not permit a reasonable jury to find an unlawful conspiracy more likely than lawful independent action.
Reasoning
The companies' declarations were not bare denials. Officers, managers, and other knowledgeable employees described how their companies independently made CARB-gasoline capacity, production, and pricing decisions, and the remaining evidence showed materially different business strategies. For example, Chevron pursued an aggressive plan to become the largest CARB-gasoline producer, while Union Oil adopted a comparatively passive approach that ultimately led it to leave the market.
The evidence of information gathering and dissemination through OPIS and other channels did not imply collusion. The exchange of useful market information can facilitate informed and efficient competition, and Aguilar offered no evidence that the information systems were used to coordinate an unlawful agreement.
The companies' use of common consultants likewise did not tend to show conspiracy. CARB gasoline presented unusually complex technical and economic decisions, few consultants possessed the relevant expertise, and the record showed that the companies required consultant confidentiality rather than using consultants as conduits for coordination.
The exchange agreements and related spot-market evidence also failed to distinguish collusion from legitimate independent conduct. Such agreements were longstanding, common features of the petroleum industry and could facilitate competition by allowing firms to serve geographic, temporal, or product markets more efficiently. Aguilar produced no evidence that these agreements were structured or used to implement a conspiracy.
Aguilar's experts inferred collusion largely from oligopolistic interdependence and parallel price movements. But firms in an oligopoly may rationally anticipate and respond to one another's behavior while deciding independently; parallel or interdependent behavior alone is not proof of agreement. Evidence of motive, opportunity, and means allowed speculation about conspiracy but did not make conspiracy more likely than independent action.
Biljac did not require a moving defendant to submit declarations from every person responsible for every relevant business decision. At most, Biljac had held that certain declarations were sufficient under an earlier, more restrictive version of California summary-judgment law. It did not render the companies' declarations and corroborating evidence insufficient under the current statute.
Issue #7
Whether the petroleum companies were also entitled to summary judgment on Aguilar's unfair-competition claim.
Holding
Yes. Although conspiracy is not invariably an element of an unfair-competition claim, Aguilar's claim in this case depended on proving the same alleged conspiracy.
Reasoning
Aguilar pleaded her unfair-competition claim as derivative of the alleged agreement to restrict CARB-gasoline output and raise prices. The companies' showing that no triable issue existed on the fact of conspiracy therefore defeated the factual premise on which this claim rested as well.
The Court accepted that the unfair competition law can reach conduct beyond Cartwright Act violations and does not, in the abstract, always require proof of conspiracy. But that general proposition could not save a claim that Aguilar herself grounded on an alleged conspiracy she failed to support with evidence.