Bill Text: CA AB1776 | 2025-2026 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Cartwright Act: violations.

Sponsorship: Partisan Bill (Democrat 13)

Status: (Engrossed) 2026-07-01 - From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 2.) (June 30). Re-referred to Com. on APPR. [AB1776 Detail]

Download: California-2025-AB1776-Amended.html

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Amended  IN  Assembly  March 23, 2026

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill

No. 1776

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Introduced by Assembly Member Aguiar-Curry
(Principal coauthor: Assembly Member Mark González)
(Principal coauthor: Senator Hurtado)
(Coauthors: Assembly Members Connolly, Elhawary, Ortega, Rogers, Schiavo)
(Coauthor: Senator Padilla)

February 09, 2026

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An act to amend Section 16720 of the Business and Professions Code, relating to business regulation. An act to add Sections 16730, 16731, 16732, and 16733 to the Business and Professions Code, relating to business regulations.

LEGISLATIVE COUNSEL'S DIGEST

AB 1776, as amended, Aguiar-Curry. Cartwright Act: trust. Cartwright Act: violations.

Existing law, commonly known as the Cartwright Act, identifies certain acts as unlawful restraints of trade and unlawful trusts and prescribes provisions for its enforcement. Chapter 338 of the Statutes of 2025 provides 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. Chapter 338 of the Statutes of 2025 also provides 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 prohibit one or more persons from acting, causing, taking, or directing measures, actions, or events that are to monopolize or monopsonize in any part of trade or commerce, as specified, or in restraint of trade. For these purposes, the bill would define “restraint of trade” to include any actions, measures, or acts included or cognizable under a specified provision of the Cartwright Act that defines “trust,” whether directed, caused, or performed by one or more persons. The bill would prohibit anticompetitive effects in one market from being offset by purported benefits in a separate market and would prohibit the harm to a person or persons from the challenged conduct from being offset by purported benefits to another person or persons. The bill would authorize any of specified conditions to constitute evidence of liability under the Cartwright Act but would prohibit requiring a finding, including, but not limited to, of any of the specified conditions to establish liability. The bill would also make related findings and declarations. The bill would require courts to liberally interpret California’s antitrust laws to best promote free and fair competition, as provided.

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.

Existing law, known as the Cartwright Act, makes every trust unlawful, against public policy, and void, subject to specified exemptions. A “trust” is defined for these purposes as a combination of capital, skill, or acts by 2 or more persons for certain prohibited purposes. A violation of the act is punishable as a crime.

This bill would, instead, define a trust as a combination of capital, skill, or acts by one or more persons. 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.

Digest Key

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

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Bill Text

The people of the State of California do enact as follows:

SECTION 1.

 Section 16730 is added to the Business and Professions Code, to read:

16730.

 (a) The purpose of this section and Sections 16731 and 16732 is the promotion and protection of free and fair competition, which is fundamental to a healthy marketplace that protects all trade participants, including workers and consumers, and to an environment that is conducive to the preservation of our democratic, political, and social institutions.

(b) Protecting competition includes protecting competition between businesses when they compete for workers by prohibiting anticompetitive business practices that impede workers’ freedom to choose employment.

(c) The California Supreme Court has determined that the Cartwright Act is “broader in range and deeper in reach” than the federal Sherman Anti-Trust Act (Cianci v. Superior Court (1985) 40 Cal.3d 903, 920). The California Supreme Court has found the Cartwright Act is not modeled on the federal Sherman Anti-Trust Act and therefore interpretations of federal antitrust law are not conclusive (Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4th 1185, 1195). Further, California courts have recognized that the Cartwright Act departs from the Sherman Anti-Trust Act in many respects, including, but not limited to, inclusion of indirect purchaser recovery, use of a proximate cause test for Cartwright Act standing, recognition of broader harms and per se conduct, lower actionable market shares, structured rule of reason analysis, and differing burdens of proof.

(d) Federal case law on the subject of this article is not binding on California state courts, but courts may consider federal case law as persuasive authority to the extent they find it consistent with California law, including this section.

(e) California agrees with the United States Department of Justice and the Federal Trade Commission in recognizing that unilateral action and multiparty actions, horizontal and vertical relationships, and various forms of corporate entities can interfere with free and fair competition, as reflected in the Federal Trade Commission and Department of Justice 2023 Merger Guidelines.

SEC. 2.

 Section 16731 is added to the Business and Professions Code, to read:

16731.

 (a) It is unlawful for one or more persons to act, cause, take, or direct measures, actions, or events that are either of the following:

(1) In restraint of trade. As used in this paragraph, “restraint of trade” includes, but is not limited to, any actions, measures, or acts included or cognizable under Section 16720, whether directed, caused, or performed by one or more persons.

(2) To monopolize or monopsonize, to attempt to monopolize or monopsonize, to maintain a monopoly or monopsony, or to combine or conspire with another person to monopolize or monopsonize in any part of trade or commerce.

(b) Anticompetitive effects and procompetitive justifications of the challenged conduct shall be evaluated within the same relevant market.

SEC. 3.

 Section 16732 is added to the Business and Professions Code, to read:

16732.

 Any of the following may constitute evidence of a violation of Section 16731, but establishing liability shall not require a finding, including, but not limited to, of any of the following:

(a) The unilateral conduct of the defendant altered or terminated a prior course of dealing between the defendant and a person subject to the exclusionary conduct.

(b) The defendant treated persons subject to the exclusionary conduct differently than the defendant treated other persons.

(c) The defendant’s price for a product or service was below any measure of the costs to the defendant for providing the product or service required under federal antitrust law.

(d) The defendant’s conduct makes no economic sense apart from its tendency to harm competition.

(e) The conduct’s risk of harming competition or actual harm must be proven with quantitative evidence.

(f) In a case where a defendant’s business is a multisided platform, the defendant’s conduct presents harm to competition on more than one side of the multisided platform, or the harm to competition on one side of the multisided platform outweighs any benefits to competition on any other side of the multisided platform.

(g) In a claim of predatory pricing, the defendant is likely to recoup the losses it sustains from below-cost pricing of the products or services at issue.

(h) The rival whose ability to compete has been reduced or harmed is as efficient, or nearly as efficient, as the defendant.

(i) A single firm or person has or might achieve a market share or has market power at or above a threshold recognized under Section 2 of Title 15 of the United States Code.

(j) A definition of “relevant market” where there is direct evidence of market power.

SEC. 4.

 Section 16733 is added to the Business and Professions Code, to read:

16733.

 Courts shall liberally interpret California’s antitrust laws to best promote free and fair competition and be mindful that California favors “maximizing” effective deterrence of antitrust violations (Clayworth v. Pfizer, Inc. (2010) 49 Cal.4th 758).

SEC. 5.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SECTION 1.Section 16720 of the Business and Professions Code is amended to read:

16720.

A trust is a combination of capital, skill or acts by one or more persons for any of the following purposes:

(a)To create or carry out restrictions in trade or commerce.

(b)To limit or reduce the production, or increase the price of merchandise or of any commodity.

(c)To prevent competition in manufacturing, making, transportation, sale or purchase of merchandise, produce or any commodity.

(d)To fix at any standard or figure, whereby its price to the public or consumer shall be in any manner controlled or established, any article or commodity of merchandise, produce or commerce intended for sale, barter, use or consumption in this State.

(e)To make or enter into or execute or carry out any contracts, obligations or agreements of any kind or description, by which they do all or any or any combination of any of the following:

(1)Bind themselves not to sell, dispose of or transport any article or any commodity or any article of trade, use, merchandise, commerce or consumption below a common standard figure, or fixed value.

(2)Agree in any manner to keep the price of such article, commodity or transportation at a fixed or graduated figure.

(3)Establish or settle the price of any article, commodity or transportation between them or themselves and others, so as directly or indirectly to preclude a free and unrestricted competition among themselves, or any purchasers or consumers in the sale or transportation of any such article or commodity.

(4)Agree to pool, combine or directly or indirectly unite any interests that they may have connected with the sale or transportation of any such article or commodity, that its price might in any manner be affected.

SEC. 2.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.