In Re Petroleum Products Antitrust Litigation

EDWARD WEINFELD, Judge

(dissenting).

I respectfully dissent from the majority’s decision to include California in the Section 1407 proceedings pending in the District of Connecticut.

The majority has concluded that transfer of California is appropriate primarily because of the common factual questions it shares with the other two actions resulting from “substantially similar allegations that the defendants violated the federal antitrust laws by conspiring to fix prices and eliminate competition from the wellhead to the ultimate consumer, the gamut of the vertically-integrated, international petroleum industry.” (Majority Opinion at p. 251). The majority reaches this conclusion from its examination of the complaints. (Majority Opinion at p. 251).

In light of the magnitude and complexity of these actions and the thorough factual development of the record before the Panel, I would go beyond the pleadings in determining the propriety of inclusion of California in the Section 1407 *253proceedings. Although all complaints do indeed contain similar broad allegations of antitrust law violations, it is my view that discovery on the critical elements of liability will differ substantially as between California on the one hand and Kansas and Connecticut on the other. Accordingly, I would hold that the just and efficient conduct of all actions is not promoted by coupling California with the other two actions.

The majority acknowledged the existence of factual issues unique to California. I am of the view they are so unique that California’s action should be recognized as such. Historically, various economic and geographic factors have required that the production of crude oil and the refining and marketing of petroleum products in the western United States be conducted separately from similar activities in the eastern portion of the nation. Recognizing the divergence between these two regions, the federal government has designated all states west of the Rocky Mountains as Petroleum Administration District V (PAD V), while Petroleum Administration Districts I-IV (PAD I-IV) are comprised of the states east of the Rockies.

The functional and historic differences between PAD V and PAD I — IV will, in my view, require distinct discovery in California with respect to the effect that defendants’ activities had in the relevant geographic market encompassed within PAD V. Since evidence regarding the causal relationship between defendants’ alleged illegal activities and the resultant harm suffered by plaintiff State of California and its political subdivisions in their particular geographic market is essential in order to establish the fact of their injury and, thus, impose treble damage liability on defendants, cf. Schumate & Co., Inc. v. National Association of Securities Dealers, Inc., 509 F.2d 147, 151, 155 (5th Cir. 1975), I conclude that the differences between the actions are substantial enough to justify leaving California alone.

Although some overlap may result if California is permitted to proceed independently, I believe that the overall just and efficient conduct of all actions would be enhanced by such a procedure. In a somewhat analogous situation, the Panel recently refused to transfer a tag-along action in In re Sugar Industry Antitrust Litigation, 399 F.Supp. 1397 (Jud.Pan.Mult.Lit.1975),1 preferring to leave that action on the East Coast although Section 1407 proceedings were already pending on the West Coast. The Panel recognized the existence of some common questions of fact between Freedman and the litigation in the transferee court but nonetheless refused transfer concluding that “the difference between defendants [East v. West], market areas and economic and conspiratorial issues is significantly preponderant.” Id. at 1400. In my judgment, the real economic and geographic differences between PAD V and PAD I-IV dictate that we should likewise refuse to transfer California to the District of Connecticut.

Alternatively, I would favor the re-transfer of Kansas along with Connecticut to the Northern District of California for coordinated or consolidated pretrial proceedings with California in that forum. In my judgment, had the California action been before us at the time the Kansas and Connecticut actions were considered for transfer, all three actions would have been transferred to California.

. Milton W. Freedman, et al. v. Amalgamated Sugar Co., et al., E.D.Pa., 399 F.Supp. 1397.