Hartford Fire Ins. Co. v. California, 509 U.S. 764 (1993)

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certiorari to the united states court of appeals for the ninth circuit

No. 91-1111. Argued February 23, 1993—Decided June 28, 1993*

Nineteen States and many private plaintiffs filed complaints alleging that the defendants—four domestic primary insurers, domestic companies who sell reinsurance to insurers, two domestic trade associations, a domestic reinsurance broker, and reinsurers based in London—violated the Sherman Act 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 to conform with the policies the defendant insurers wanted to sell. After the actions were consolidated for litigation, the District Court granted the defendants' motions to dismiss. The Court of Appeals reversed, rejecting the District Court's conclusion that the defendants were entitled to antitrust immunity under 2(b) of the McCarran-Ferguson Act, which exempts from federal regulation "the business of insurance," except "to the extent that such business is not regulated by State Law." Although it held the conduct involved to be "the business of insurance," the Court of Appeals ruled that the foreign reinsurers did not fall within 2(b)'s protection because their activities could not be "regulated by State Law," and that the domestic insurers had forfeited their 2(b) exemption when they conspired with the nonexempt foreign reinsurers. Furthermore, held the court, most of the conduct in question fell within 3(b), which provides that nothing in the McCarran-Ferguson Act "shall render the . . . Sherman Act inapplicable to any . . . act of boycott . . . ." Finally, the court rejected the District Court's conclusion that the principle of international comity barred it from exercising Sherman Act jurisdiction over the three claims brought solely against the London reinsurers.

Held: The judgment is affirmed in part and reversed in part, and the cases are remanded.

938 F. 2d 919, affirmed in part, reversed in part, and remanded.

Justice Souter delivered the opinion of the Court with respect to Parts I, II-A, III, and IV, concluding that:

*Together with No. 91-1128, Merrett Underwriting Agency Management Ltd. et al. v. California et al., also on certiorari to the same court.

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