AB 325: Cartwright Act: violations.

Existing law establishes the Attorney General as the head of the Department of Justice, with charge of all legal matters in which the state is interested, except as specified. Existing law imposes various requirements on the Attorney General related to consumer protection, including, among others, the supervision of charitable trusts and the enforcement of antitrust laws. Existing law, commonly known as the Cartwright Act, identifies certain acts that are unlawful restraints of trade and unlawful trusts and prescribes provisions for its enforcement.

Existing law requires a complaint or cross-complaint to contain, among other things, a statement of facts constituting the cause of action, in ordinary and concise language.

This bill would instead provide that in a complaint for any violation of the Cartwright Act, it is sufficient to contain factual allegations demonstrating that the existence of a contract, combination in the form of a trust, or conspiracy to restrain trade or commerce is plausible. The bill would provide that a complaint for any violation of the Cartwright Act is not required to allege facts tending to exclude the possibility of independent action.

This bill would also prohibit a person from using or distributing any pricing algorithm that uses, incorporates, or was trained with nonpublic competitor data, as defined. The bill would provide that certain presumptions are established as applicable, including that the defendant entered into a contract in restraint of trade, as specified, if any of specified requirements are established, including that the defendant distributed the pricing algorithm to 2 or more persons with the intent that the pricing algorithm be used to set or recommend a price, as defined, or commercial term, as defined, of a product or service in the same market or a related market and 2 or more persons used the pricing make it unlawful, except as provided, for a person to use or distribute any pricing algorithm that uses, incorporates, or was trained with data other than nonpublic competitor data if the person either distributes the pricing algorithm, as specified, or uses the pricing algorithm to set or recommend a price or commercial term of a product or service. service and the pricing algorithm was used by another person to set or recommend a price or commercial term of a product or service in the same market or a related market. Because the bill would expand the scope of activities prohibited by the Cartwright Act, the violation of which is punishable as a crime, the bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.