California Civil Jury Instructions (CACI)

3430. "Noerr-Pennington" Doctrine

[Name of defendant] claims that [his/her/its] agreement with [name of alleged co-participant] did not violate the law because [he/ she/it] was trying in good faith to influence government action. [Name of plaintiff] claims that this action was a sham or a pretext to restrain competition.

To establish [his/her/its] claim, [name of plaintiff] must prove both of the following:

1. That [name of defendant]'s actions before [name of governmental body] were undertaken without regard to the merits; and

2. That the reason [name of defendant] engaged in [specify the petitioning activity, e.g., "filing an objection to an environmental impact report"] was to use the [specify the claimed process, e.g., "environmental agency approval"] process to harm [name of plaintiff] by [specify the manner of harm, e.g., "delaying [name of plaintiff]'s entry into the market"], rather than to obtain a successful outcome from that process.

Sources and Authority

"The Noerr-Pennington doctrine provides that there is no antitrust liability under the Sherman Act for efforts to influence government which are protected by the First Amendment right to petition for redress of grievances, even if the motive behind the efforts is anticompetitive. An exception to the doctrine arises when efforts to influence government are merely a sham; such efforts are not protected by the Noerr-Pennington doctrine and are subject to antitrust liability." (Hi-Top Steel Corp. v. Lehrer (1994) 24 Cal.App.4th 570, 574-575 [29 Cal.Rptr.2d 646], internal citations omitted.)

"Stated most generally, the Noerr-Pennington doctrine declares that efforts to influence government action are not within the scope of the Sherman Act, regardless of anticompetitive purpose or effect." (Blank v. Kirwan (1985) 39 Cal.3d 311, 320 [216 Cal.Rptr. 718, 703 P.2d 58], internal citations omitted.)

" 'The right of the people to inform their representatives in government of their desires with respect to the passage or enforcement of laws cannot properly be made to depend upon their intent in doing so. It is neither unusual nor illegal for people to seek action on laws in the hope that they may bring about an advantage to themselves and a disadvantage to their competitors.' " (Hi-Top Steel Corp., supra, 24 Cal.App.4th at p. 576, internal citations omitted.)

"[T]he sham exception 'encompasses situations in which persons use the governmental process—as opposed to the outcome of that process—as an anticompetitive weapon.' It 'involves a defendant whose activities are "not genuinely aimed at procuring favorable government action" at all, not one "who 'genuinely seeks to achieve his governmental result, but does so through improper means'. " ' " (Hi-Top Steel Corp., supra, 24 Cal.App.4th at p. 577, internal citations omitted.)

"[W]e hold the sham exception to the Noerr-Pennington doctrine is applicable in California." (Hi-Top Steel Corp., supra, 24 Cal.App.4th at p. 579.)

"While the Noerr-Pennington doctrine was formulated in the context of antitrust cases, it has been applied or discussed in cases involving other types of civil liability, including liability for interference with contractual relations or prospective economic advantage or unfair competition." (Hi-Top Steel Corp., supra, 24 Cal.App.4th at pp. 577- 578, internal citations omitted.)

Secondary Sources

1 Witkin, Summary of California Law (9th ed. 1987) Contracts, § 578

2 Antitrust and Trade Regulation Law Section, State Bar of California, California Antitrust Law (2d ed. 2001), § 16.11

6 Antitrust Laws & Trade Regulation, Ch. 105, California, § 105.10[1][h] (Matthew Bender)

3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts, § 40.164[5][a] (Matthew Bender)

49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition (Matthew Bender)

(New September 2003)