Senate approves bill letting indirect buyers share in antitrust recoveries after debate on class actions and attorney fees

The Utah Senate passed Senate Bill 16 on third reading after extended floor debate and an amendment intended to prevent duplicate recoveries when parallel federal and state claims exist.

Sponsor (unnamed in transcript) told colleagues the bill reverses the effect of the 1977 U.S. Supreme Court decision Illinois Brick by allowing indirect purchasers — consumers who did not buy directly from an alleged price-fixing distributor — to participate in antitrust recoveries. The sponsor said states that have adopted similar rules enable consumers to share in multi-state settlements rather than leaving recoveries with a distributor or out-of-state claimants.

The sponsor moved amendment 1 to clarify that recoveries are not duplicated when parallel federal and state proceedings occur, and to preserve judicial allocation of funds when ultimate victims cannot be identified. "If you have a case pending in state court and federal court on the same issue, the wrongdoer only has to pay the damage once," the sponsor said, explaining the amendment limits duplicate recovery.

Several senators pressed sponsors about potential unintended consequences. Senator Aaron asked whether a nonresident purchaser who lived in Utah at the time of the purchase could recover under the bill. The sponsor said he would provide a detailed answer if the bill reached third reading.

County Attorney Senator Thomas and others flagged concerns the bill could create a new class-action industry targeting technical violations and driving up contingency-fee litigation. Thomas said he worried that allowing indirect purchasers could "create a new boutique business where plaintiff's attorneys go out trying to find technical violations." He said he would support the bill only with additional safeguards. Senator Bell likewise expressed concern about attorney fees and said he would prepare an amendment to require court approval of attorneys' contingency fees.

Supporters argued that antitrust cases already include court-reviewed attorney-fee awards and that adding indirect purchasers lets Utah consumers and the attorney general participate in settlements they currently miss. The sponsor said the attorney general's office would be able to monitor and, where appropriate, join litigation to protect Utah's share of recoveries.

The Senate adopted the sponsor's amendment and proceeded to a roll call; the bill passed with 27 yes votes, 1 nay and 1 absent and will move forward for further processing.

The bill now advances with a floor amendment addressing duplicate recovery; proponents and opponents indicated further amendments or clarifying language could be offered on third reading to address attorney-fee oversight and the scope of class actions.