Third Circuit Holds That A Concessions Vendor Does Not Have Antitrust Standing To Challenge An Exclusive Agreement Between An Airport And A Third-Party Beverage Company
On April 27, 2022, the United States Court of Appeals for the Third Circuit held that a concessions vendor did not have antitrust standing to challenge an exclusive beverage agreement between the Philadelphia International Airport and a third-party beverage company under Section 1 of the Sherman Antitrust Act. Host Int’l, Inc. v. Marketplace, PHL, LLC, No. 20-2848 (3d Cir. Apr. 27, 2022). Accordingly, the Court affirmed a district court ruling granting a motion to dismiss the concession vendor’s antitrust claims.
Ninth Circuit En Banc Panel Reinstates District Court Decision Certifying Three Subclasses Of Purchasers In Packaged Tuna Price-Fixing Class Action Lawsuit
On April 8, 2022, the United States Court of Appeals for the Ninth Circuit, sitting en banc, affirmed an earlier district court order that certified three subclasses of tuna purchasers in a class action lawsuit alleging that defendants violated federal and state antitrust laws. Olean Wholesale Grocery Coop. Inc. v. Bumble Bee Foods LLC, No. 19-56514, 2022 WL 1053459 (9th Cir. Apr. 8, 2022).
First Circuit Holds That Concerted Action By Independent Contractor Jockeys Seeking Better Pay Is Protected Conduct Under The Labor-Dispute Exemption
On April 4, 2022, the United States Court of Appeals for the First Circuit reversed a district court’s ruling that a group of jockeys violated federal antitrust law by engaging in a group boycott and jointly refusing to participate in races in an effort to obtain better pay. Confederacion Hipica de Puerto Rice, Inc. v. Confederacion de Jinetes Puertorriquenos, Inc., No. 19-2201 (1st Cir., April 4, 2022). The First Circuit held that the jockeys’ status as independent contractors, rather than traditional employees, did not preclude them from claiming protection for their concerted action under the labor-dispute exemption to the antitrust laws because the issue in the dispute was labor-related.
Ninth Circuit Revives SmileDirect Antitrust Suit
On March 17, 2022, the United States Court of Appeals for the Ninth Circuit affirmed in part and reversed in part the dismissal of an antitrust complaint brought by SmileDirectClub LLC (“SmileDirect”) against the Dental Board of California. The complaint alleged that the Dental Board of California utilized unfounded investigations to intimidate and harass with the aim of driving SmileDirect out of the dental and orthodontia markets because of the threat that its cheaper direct-to-consumer model posed to the traditional practice of dentistry. SmileDirectClub, LLC v. Tippins, No. 20-55735 (9th Cir. Mar. 31, 2022).
Auto-Parts Supplier Lacks Standing To Bring Antitrust Claims Against Standard-Essential Patent Holders And Licensors Of Vehicular Wireless Connection Technology
On February 28, 2022, the United States Court of Appeals for the Fifth Circuit held that an upstream auto-parts supplier lacked Article III standing to bring an antitrust suit challenging the alleged refusal of certain standard-essential patent holders and their agent to license the supplier patents on fair, reasonable, and nondiscriminatory (“FRAND”) terms. Cont’l Auto. Sys., Inc. v. Avanci, LLC et al., No. 20-11032 (5th Cir. Feb. 28, 2022).
Ninth Circuit Affirms Dismissal Of Antitrust Allegations In DRAM Pricing Case
On March 7, 2022, the United States Court of Appeals for the Ninth Circuit affirmed the dismissal of claims that the three largest manufacturers of dynamic random-access memory (“DRAM”) conspired to artificially inflate prices by restricting supply. In re DRAM Indirect Purchaser Antitrust Litigation, 21-15125 (9th Cir. Mar. 7, 2022). Plaintiffs alleged that defendants conspired to simultaneously reduce the production of DRAM in order to drive up prices. The United States District Court for the Northern District of California dismissed the claims because plaintiffs’ allegations did not rise to the level of plausibility required under Rule 12(b)(6). The Ninth Circuit affirmed, holding that the facts as alleged were not sufficient to establish that defendants’ alleged conduct was the result of a “preceding agreement,” rather than conscious parallel behavior.
U.S. District Court For The Southern District Of Texas Dismisses Claims Against Three Largest U.S. Producers Of Steel
On February 17, 2022, the United States District Court for the Southern District of Texas dismissed an antitrust suit against the country’s largest steel manufacturers. JSW Steel (USA) Inc. v. Nucor Corp. et al., 4:21-cv-01842 (S.D. Tex. 2022). Plaintiff, JSW Steel (a finished-steel producer), alleged that Cleveland Cliffs Inc., Nucor Corp., and U.S. Steel Corp. violated Section 1 of the Sherman Act and various Texas state competition and contracts laws. Specifically, Plaintiff alleged that Defendants colluded to increase the price of certain steel imports by lobbying for tariffs, while not being able to provide Plaintiff with equivalent steel products. Plaintiff argued that its thriving business was crippled and eventually failed due to the collusive behavior of Defendants.
New Tennessee Case Alleges “Archrivals” Google And Facebook Secretly Conspired To Dominate The Worldwide Digital Advertising Market
It is widely known that the evolution to online news has been challenging for print media sources, with some estimating that as much as half of all print revenue disappearing and one fifth of U.S. newspapers closing their doors since 2007. In recent years, the House and Senate have focused on tech giants and the role these companies play in the lives of Americans and in a variety of markets, including digital advertising. Following a long line of congressional hearings and committee investigations, a number of antitrust complaints have been filed by the Federal Trade Commission, the Department of Justice, and state Attorneys General across the country against major Big Tech companies like Facebook (now known as Meta Platforms, Inc.) and Google. While some have been consolidated into multidistrict litigation, new cases continue to be filed by private plaintiffs.
Northern District Of California Dismisses App Developer’s Antitrust Claims Against Apple
On January 7, 2022, Edward M. Chen of the United States District Court for the Northern District of California dismissed an app developer’s claim that Apple, Inc.’s operation of the Apple App Store had violated both state and federal antitrust laws. Reilly v. Apple, Inc., No. 21-cv-04601 (N.D. Cal. Jan. 7, 2022). The developer alleged that Apple had monopolized the market for iOS-app distribution (iOS is Apple’s operating system). The district court dismissed the case, holding that the app developer had failed to plausibly allege either a relevant market or an antitrust injury.
Eleventh Circuit Affirms That Seller Does Not Have Antitrust Claims Against Buyer For Post-Closing Conduct That Avoided Earnout Payment
On January 4, 2022, the United States Court of Appeals for the Eleventh Circuit affirmed a district court’s dismissal of an antitrust suit filed by the sellers of a healthcare risk adjustment service company. Ekbatani et al. v. Cmty. Care Health Network, LLC et al., No. 21-12322 (11th Cir. Jan. 4, 2022). The sellers alleged that the buyer, who was a direct competitor, violated federal antitrust laws by intentionally reducing the company’s revenue after closing. That conduct, allegedly, resulted in the sellers’ loss of an “earnout” payment that was contingent upon the company’s performance post-closing. The three-judge panel affirmed that plaintiffs, the previous owners of the acquired business, did not have antitrust standing to bring their Clayton Act claim.
U.S. District Court For The District Of Columbia Allows FTC’s Second Attempt At Monopolization Claims Against Facebook To Go Forward
On January 11, 2022, Judge James E. Boasberg of the U.S. District Court for the District of Columbia denied Facebook, Inc.’s motion to dismiss the Federal Trade Commission (“FTC”) amended complaint alleging that Facebook Inc. monopolized the alleged market for personal social networking (“PSN”) services in violation of Section 2 of the Sherman Act, finding that, in contrast to its original complaint, the FTC’s amended complaint adequately alleged facts to support its proposed market definition and that defendant possessed monopoly power in that market.
Collusion In Telescope Market Was Clear To See, Finds Ninth Circuit
On December 6, 2021, Judge Ronald M. Gould of the Ninth Circuit Court of Appeals affirmed jury verdicts against defendant-telescope manufacturers and distributors. Optronic Technologies, Inc. v. Ningbo Sunny Electronic Co., Ltd., et al., No. 2:20-cv-15940 (9th Cir. 2021). Plaintiff alleged that defendants conspired to fix prices on telescopes and monopolize the market in violation of the Sherman Act, the Clayton Act, and California antitrust and competition laws. The Court largely affirmed the district court jury’s decisions, vacating and remanding only as to the amount of the settlement set-off.
Supreme Court Denies Certiorari In State Hospital System Antitrust Immunity Case
On December 6, 2021, the U.S. Supreme Court declined to hear an appeal from a Fourth Circuit ruling that Charlotte-Mecklenburg Hospital Authority, a North Carolina hospital system doing business as Atrium Health, counted as an arm of the local government. The Fourth Circuit’s decision meant that Atrium was immune from antitrust liability, and the Supreme Court’s decision leaves a potential circuit split on the status of dominant quasi-public hospital systems unresolved.
Northern District Of California Dismisses Sherman Act Complaint Against Platform Operator Based On Implausible Single-Brand Market Definitions And Failure To Allege Harm To Competition
On November 30, 2021, Judge Edward M. Chen of the United States District Court for the Northern District of California dismissed a putative class action alleging that the defendant smartphone supplier’s contracts with mobile application (“apps”) developers and related guidelines violate Sections 1 and 2 of the Sherman Act based on plaintiffs’ failure to allege a plausible relevant market or that they suffered antitrust harm. Judge Chen also dismissed plaintiffs’ breach of contract, RICO, and fraud claims. Coronavirus Reporter v. Apple Inc., No. 21-cv-05567-EMC (N.D. Cal. 2021).
Fifth Circuit Blocks Topgolf Antitrust Suit For Lack Of Antitrust Injury
On November 15, 2021, Judges Edith Jones, Jerry Smith, and James Haynes of the United States Court of Appeals for the Fifth Circuit affirmed the dismissal of an antitrust complaint related to Topgolf International’s (“Topgolf”) acquisition of Protracer in 2016. The complaint alleged that Topgolf acquired a technology owned by Protracer in order to drive its competitor, SureShot Golf Ventures (“SureShot”) out of business in violation of Section 1 and 2 of the Sherman Act. SureShot Golf Ventures, Inc. vs. Topgolf International, Inc., 21-20132 (5th Cir. Nov. 15, 2021).
Seventh Circuit Affirms Dismissal Of Section 1 Complaint Against Medical Board For Failure To Plead Facts Supporting Conspiracy Allegations
On October 8, 2021, the United States Court of Appeals for the Seventh Circuit affirmed the Northern District of Illinois’ dismissal of a complaint alleging that a nonprofit provider of medical certifications violated Section 1 of the Sherman Act by conspiring to restrain trade in the alleged nationwide market for medical care. The three-judge panel found that plaintiff, an association of medical practitioners, alleged only conclusory claims against defendant and failed to plead adequate facts to state a claim for unlawful conspiracy under Section 1 of the Sherman Act. Ass’n of Am. Physicians & Surgeons, Inc. v. Am. Board of Med. Specialties, No. 20-3072 (7th Cir. Oct. 8, 2021).
District Of New Jersey Rejects Claim Of Sham Patent Litigation
On October 27, 2021, Judge Kevin McNulty of the United States District Court for the District of New Jersey dismissed a complaint alleging that a cancer drug manufacturer engaged in sham litigation in violation of Section 2 of the Sherman Act and various state antitrust and consumer protection laws based on the same alleged sham litigation. Louisiana Health Service & Indemnity Company v. Janssen Biotech, Inc., 19-14146 (D.N.J. Oct. 27, 2021).
Ninth Circuit Affirms Denial Of Preliminary Injunction Against Arizona “Dealer Data Security Law”
On October 25, 2021, a unanimous panel of the United States Court of Appeals for the Ninth Circuit affirmed a district court order denying database vendors’ (“Plaintiff-Appellants”) motion for a preliminary injunction against enforcement of Arizona’s 2019 “Dealer Data Security Law.” CDK Global LLC v. Brnovich, No. 20-16469 (9th Cir. 2021). The Arizona law restricts car dealership database vendors from engaging in certain practices believed to be anticompetitive and provides consumers with certain additional privacy rights over the information that is collected for such databases. The database vendors argued that the law was preempted by the federal Copyright Act and violated their federal constitutional rights.
Tech Start-Up’s Monopoly Suit Moves Forward Against Utilities Management Power Player
On September 30, 2021, Judge Amy Totenberg of the United States District Court for the Northern District of Georgia denied a utilities management company’s motion to dismiss state and federal antitrust and tortious interference claims. Lucasys Inc. v. Powerplan, Inc., No. 1:20-cv-02987 (N.D. Ga. Sept. 30, 2021). Plaintiff alleges five counts of antitrust violations by defendant under Sections 1 and 2 of the Sherman Act, for unlawful restraint of trade and monopoly maintenance via negative tying, the concerted refusal to deal with plaintiff and other market competitors by denying access to software and data needed to develop competing products, and de facto exclusive dealing provisions in contracts with utilities. The Court found that plaintiff had sufficiently pled its claims at the motion to dismiss stage and declined to grant defendant’s motion to dismiss.
DOJ Says Agreement Not To Recruit And To Suppress Wages In Las Vegas Case Is Clearly Illegal
On October 1, 2021, the U.S. Department of Justice (“DOJ”) filed a response in Nevada federal court opposing a motion to dismiss from defendants VDA OC LLC and its former regional manager Ryan Hee, in a case in which they are charged with agreeing with another unnamed contractor not to recruit or hire from one another, and to suppress wages for Las Vegas school nurses. The DOJ stated that this is a simple case arguing that agreeing to allocate nurses is market division, and fixing nurses wages is price fixing, both of which have long been considered per se unlawful under the antitrust laws.
Ninth Circuit Reverses Certification Of A Nationwide Indirect Purchaser Class Due To State Law Differences And Its Prior Decision In FTC v. Qualcomm
On September 29, 2021, the United States Court of Appeals for the Ninth Circuit reversed a district court’s order certifying a nationwide class of up to 250 million people. The Ninth Circuit concluded that a common issue of law does not predominate because the laws of other several states apply, not just California’s Cartwright Act and Unfair Competition Law. In re Qualcomm Antitrust Litig., No. 19-15159, 2021 WL 4448713 (9th Cir. Sept. 29, 2021). The indirect purchaser plaintiffs are consumers who allege that Qualcomm Incorporated (“Qualcomm”) violated federal antitrust laws and California’s Cartwright Act and Unfair Competition Law by engaging in certain corporate policies regarding their licensing of standard essential patents (“SEPs”) and related sales of modem chips. The Ninth Circuit held that California’s choice of law rules precluded class certification because states without an Illinois Brick repealer statute, which often authorize indirect purchasers to bring antitrust damages suits, “have a clear interest in applying their laws to class members” and to apply only California law would “allow California to set antitrust enforcement policy for the entire country.”
Northern District Of California Finds That Antitrust Claims Against Technology Platform Fail While California’s Unfair Competition Law Supports Limited Injunction
On September 10, 2021, Judge Yvonne Gonzalez Rogers of the United States District Court for the Northern District of California issued her post-trial decision in Epic Games, Inc. v. Apple Inc., No. 4:20-cv-05640-YGR (N. D. Cal. 2021). Plaintiff claimed that defendant’s developer policies violated Sections 1 and 2 of the Sherman Act and the Cartwright Act, California’s analogue to the Sherman Act, as well as California’s Unfair Competition Law (“UCL”). The Court, in a 185-page opinion, found that plaintiff did not meet its burden to show that defendant’s policies violated the antitrust laws and denied plaintiff the broad injunction that would have required substantial changes to defendant’s App Store business. However, the Court held that plaintiff was entitled to a limited injunction under the UCL as to defendant’s anti-steering restrictions. The Court also granted contract damages for defendant’s counterclaims against plaintiff.
Eastern District Of Virginia Certifies Class Of Cholesterol Drug End Payors
On August 20, 2021, Judge Rebecca Smith of the United States District Court for the Eastern District of Virginia certified a class of end-payor plaintiffs (“EPPs”) alleging that defendant pharmaceutical companies (“defendants”) entered into a reverse payment agreement that delayed generic competition to the branded cholesterol drug Zetia in violation of Section 1 of the Sherman Act. In re Zetia (Ezetimibe) Antitrust Litig., MDL No. 2:18-md-2836 (E. D. Va. 2021). This case is part of a multidistrict litigation against defendants, and Judge Smith’s certification decision was in the face of a Fourth Circuit decision two weeks prior that vacated her decision to certify a different class of plaintiffs.
Ninth Circuit Rejects Sherman Act Challenge To Non-Solicitation Provision In Contract Between Traveling Nurse Staffing Firms
On July 19, 2021, the United State Court of Appeals for the Ninth Circuit affirmed summary judgment in favor of defendant/appellee healthcare staffing firm, holding that the non-solicitation provision in defendant’s contract with plaintiff/appellant to provide traveling nurse services did not amount to a naked restraint on trade because it was ancillary to the overall pro-competitive agreement between the parties and plaintiff had not shown harm to competition. Aya Healthcare Servs., Inc. v. AMN Healthcare, Inc., No. 20-55679, 2021 WL 3671384 (9th Cir. Aug. 19, 2021).
Northern District Of California Finds Exclusive Real Estate Service Is Improper Plaintiff To Enforce Antitrust Claims Against Competitor Trade Association
On August 16, 2021, Judge Vince Chhabria of the United States District Court for the Northern District of California dismissed, with prejudice, a complaint alleging that the dominant national real estate listing service violated Section 1 of the Sherman Act by prohibiting realtors from marketing a property to the public unless they also list the property on the service. Top Agent Network, Inc. v. National Ass’n of Realtors, No. 20-cv-03198-VC (N.D. Cal. Aug. 16, 2021). The Court found that, although plaintiff—a competing real estate listing service—may have alleged an antitrust violation, plaintiff did not have antitrust standing to bring the claim.
Second Circuit Takes A Second Look At Chinese Vitamin C Price-fixing Case And Again Affirms Dismissal
On August 10, 2021, the Second Circuit, in a 2-1 decision, affirmed the dismissal—for the second time—of price-fixing claims against a pair of Chinese vitamin C exporters, after the Supreme Court had remanded it for further consideration. Animal Science Prods., et al., v. Hebei Welcome Pharma. Co. Ltd., et al., 13-4791-cv (2nd Cir. Aug 10, 2021). Following the Supreme Court’s directive to “carefully consider but not conclusively defer” to submissions from the Chinese Ministry of Commerce, a three-judge panel of the Second Circuit agreed that the case should, nevertheless, still be dismissed on international comity grounds. This decision—involving the Chinese government’s first appearance in a U.S. court—was unusual for an antitrust case in that there was no real dispute that the alleged anticompetitive conduct occurred. Instead, the question centered on “whether Chinese law required the Chinese sellers’ conduct.”
Southern District Of Illinois Refuses To Certify A Class Alleging That Jimmy John’s No-Poach Clauses Suppressed Wages
On July 23, 2021, the United States District Court for the Southern District of Illinois denied a named plaintiff’s motion for class certification against Defendants Jimmy John’s Franchise, LLC and Jimmy John’s Enterprises, LLC on the basis that he did not meet the factors required to certify a class—among which included his failure to show that his claims where typical of the claims of the potential class members he purported to represent. Conrad v. Jimmy John’s Franchise, LLC, No. 18-CV-00133-NJR (S.D. Ill. July 23, 2021).
Court Upholds Narrow Interpretation Of “Sham Suit” Exception To Noerr-Pennington Doctrine
On July 26, 2021, Chief Judge Freda L. Wolfson of the United States District Court for the District of New Jersey dismissed “sham litigation” monopolization counterclaims against a pharmaceutical patent holder, finding that the patent holder conducted a reasonable investigation before filing the underlying infringement suit and did not unreasonably delay the proceedings before determining that the counterclaim plaintiff’s generic substitute for the patent holder’s drug did not infringe its patent and voluntarily dismissing its infringement claims. Takeda Pharmaceutical Co. Ltd., et al. v. Zydus Pharmaceuticals (USA) Inc., et al., No. CV 18-1994 (FLW), 2021 WL 3144897 (D.N.J. July 26, 2021). Because the generic manufacturer could not establish that the patent holder’s infringement lawsuit was either objectively or subjectively baseless, the Court granted summary judgment for the patent holder.
Delaware District Court Dismisses App Developer’s Monopoly Claims Against Tech Giant
On July 9, 2021, Judge Leonard P. Stark of the United States District Court for the District of Delaware granted defendant’s motion to dismiss antitrust claims brought by an application (“app”) developer against one of the world’s largest technology companies for failing to adequately allege that requiring apps to offer a defendant-specific log-in function harmed competition. Blix Inc. v. Apple, Inc., C.A. No. 19-1869-LPS (D. Del. July 9, 2021).
Fast-Food Franchise Cases Hash Out Standard Of Review For Labor Market Restrictions
The parties in two separate cases involving labor market restrictions submitted supplemental briefing within days of one another following the Supreme Court’s ruling in the much-anticipated NCAA v. Alston case on June 21, 2021. The unanimous opinion, written by Justice Neil Gorsuch with a full concurrence by Justice Brett Kavanaugh, was levied to support arguments by both sets of defendants and plaintiffs on the appropriate standard of review in each of their cases. This battle is being fought in a broader context of increased activity by the Department of Justice in pursuing “no-poach” agreements between employers, and President Biden’s July 9th Executive Order, which specifically addressed labor non-compete agreements.
Western District Of Pennsylvania Dismisses Antitrust Action For Failure To Adequately Define A Product Market
On June 29, 2021, the United States District Court for the Western District of Pennsylvania dismissed Multiple Energy Technologies, LLC’s (“Plaintiff”) Second Amended Complaint against Under Armour, Inc. (“Defendant”) for failure to adequately plead a relevant product market and granted Plaintiff leave to amend its complaint. Multiple Energy Techs., LLC v. Under Armour, Inc., No. 2:20-CV-664-NR, 2021 WL 2661827 (W.D. Pa. June 29, 2021). The Court found that a sufficient product market definition requires pleading facts that allege: (1) high elasticity among all products within the alleged market; and (2) low elasticity between products within the alleged market and products outside the alleged market.
Dual Facebook Enforcement Actions Dismissed In District Of Columbia
On June 28, 2021, Judge James E. Boasberg of the United States District Court for the District of Columbia dismissed dual enforcement actions brought by the Federal Trade Commission (“FTC”) and the attorneys general of 46 states and the District of Columbia (the “state enforcers”) against Facebook, Inc. (“Facebook”). See FTC v. Facebook, Inc., No. 1:20-cv-03590-JEB (D.D.C. June 28, 2021), ECF 73 (the “FTC Action”); State of New York et al. v. Facebook, Inc., No. 1:20-cv-03589-JEB (D.D.C. June 28, 2021), ECF 137 (the “States’ Action”).
Supreme Court Sustains Injunction Against NCAA Rules Limiting Education-Related Benefits Received By Student Athletes
On June 21, 2021, the United States Supreme Court issued a decision in a long running and closely watched dispute between the National Collegiate Athletic Association, along with 11 Division I conferences, (together, the “NCAA” or “Defendants”) and a class of current and former Division I football and basketball players claiming that NCAA restrictions on their compensation violated Section 1 of the Sherman Act (together, the “student athletes” or “Plaintiffs”). NCAA v. Alston, et al., No. 20–512, 594 U.S. ___ (2021). The Court’s unanimous decision, written by Justice Neil Gorsuch, upheld a district court order enjoining NCAA limits placed on education-related benefits provided by member schools to student athletes and permitting limits on compensation and benefits related to athletic performance.
Northern District Of Illinois Terminates Claims Against Bank In Antitrust Suit
On June 1, 2021, Judge Thomas Durkin of the United States District Court for the Northern District of Illinois dismissed a complaint alleging that a bank conspired with other defendants in the poultry industry in violation of Section 1 of the Sherman Act. In re Broilers Chicken Antitrust Litig., 16-8637 (N.D. Ill. June 1, 2021).
Illinois District Court Finds Chicken Purchasers’ Conspiracy Claims Against Bank Are For The Birds
On June 1, 2021, Judge Thomas M. Durkin of the United States District Court for the Northern District of Illinois granted defendant’s motion to dismiss price-fixing claims brought by a group of chicken buyers against a large bank operating in the agribusiness industry. In re Broiler Chicken Antitrust Litigation, No. 16 C 8637 (N.D. Ill. June 1, 2021).
D.C. Circuit Vacates FAA Decision That Failed To Consider Effect On Competition
On May 21, 2021, a panel of the United States Court of Appeals for the D.C. Circuit vacated a decision by the Federal Aviation Administration (“FAA”) to retire takeoff and landing “slots” forfeited by Southwest Airlines (“Southwest”) at New Jersey’s Newark Liberty Airport (“EWR”), finding that, by failing to consider what impact the move would have on airline competition at the airport, the FAA had acted arbitrary and capricious and without substantial evidence, in violation of the federal Administrative Procedures Act (“APA”). Judge Douglas H. Ginsburg wrote the opinion, which was joined by Judges Karen L. Henderson and Justin R. Walker. The case is Spirit Airlines, Inc. v. United States Department of Transportation, 19-1248 (D.C. Cir., May 21, 2021).
Fifth Circuit Finds Sherman Act Conspiracy Claims Survive Statute Of Limitations Challenge
On May 18, 2021, the United States Court of Appeals for the Fifth Circuit reversed a district court’s dismissal of claims by the Academy of Allergy & Asthma in Primary Care and United Allergy Services (“plaintiffs”) that Quest Diagnostics (“Quest”) violated §§ 1 and 2 of the Sherman Act. Acad. of Allergy & Asthma in Primary Care v. Quest Diagnostics, Inc., No. 20-50179, 2021 WL 1976666 (5th Cir. May 18, 2021). The district court originally dismissed the claims because Quest did not commit any overt acts within the four-year statute of limitations period. On appeal, the Court found that an email from Quest’s co-conspirator referencing a meeting with a Quest employee provided sufficient evidence of an overt act to extend the statute of limitations period.
Monopolization Complaint Dismissed For Failure To Adequately Define The Relevant Product Market Or Plead Anticompetitive Conduct
On May 13, 2021, U.S. District Judge Beth Labson Freeman of the Northern District of California dismissed, with leave, to amend a monopolization claim against Google and its parent company for failure to properly define the relevant product market or to adequately plead anticompetitive conduct. In re Google Digital Advertising Antitrust Litigation, No. 20-CV-03556-BLF (N.D. Cal. May 13, 2021).
Impax Reaches Impasse As Fifth Circuit Denies Review Of FTC’s First Post-Actavis Reverse Payment Ruling
On April 13, 2021, the United States Court of Appeals for the Fifth Circuit, in an opinion authored by Judge Gregg Costa, affirmed the Federal Trade Commission’s (“FTC”) order finding a reverse payment settlement between a branded drug manufacturer and a generic drug manufacturer violated the FTC Act and the Sherman Act. Impax Laboratories, Inc. v. Federal Trade Commission, No. 19-60394 (5th Cir. 2021). The Court upheld the FTC administrative court’s finding that the settlement agreement was anticompetitive because it “replaced the ‘possibility of competition with the certainty of none.’”
Northern District Of California Shuts Down App Developers’ Antitrust Suit
On April 26, 2021, Judge Beth Labson Freeman of the United States District Court for the Northern District of California dismissed a complaint alleging that Facebook violated Section 2 of the Sherman Act by removing certain application interfaces that plaintiffs relied on for their mobile applications. Reveal Chat Holdco LLC, et al. v. Facebook, 5:20-cv-00363 (N.D. Cal. Apr. 26, 2021). Plaintiffs alleged that the application programming interfaces (“APIs”) were central to their ability to function and that the removal of these APIs by Facebook in 2015 was part of a scheme to harm applications that were competitive or potentially competitive with Facebook. In dismissing the complaint for a second time and with prejudice, the Court concluded that plaintiffs’ “entire theory of liability is based on completed acts by Facebook beyond the limitations period” and that their claims were therefore time-barred.
U.S. Supreme Court Unanimously Narrows The FTC’s Enforcement Powers
On April 22, 2021, the U.S. Supreme Court abated the Federal Trade Commission’s (“FTC”) restitution power in a unanimous opinion delivered by Justice Stephen Breyer. AMG Cap. Mgmt., LLC v. Fed. Trade Comm’n, 141 S. Ct. 1341 (2021). Notably, the Court declared that the language of Section 13(b) of the FTC Act does not empower the FTC to obtain court-ordered equitable monetary relief such as restitution or disgorgement. In so doing, the Court resolved a circuit split on the issue and reversed the Ninth Circuit’s decision.
FTC’s Cancer Detection Antitrust Suit Transferred To California Southern District
On April 20, 2021, the United States District Court for the District of Columbia granted defendants’ motion to transfer a motion for preliminary injunction brought by the Federal Trade Commission (“FTC”) alleging that defendants’ plans to enter into a merger agreement violated Section 5 of the FTC Act and Section 7 of the Clayton Act. Federal Trade Commission v. Illumina, et al., No. 21-873 (D.D.C. 2021). The Court found that the U.S. District Court for the Southern District of California was a more appropriate venue for litigation of the case on the basis that it would be easier for most of the witnesses to get to that district, among other factors. Preliminary injunction hearings are currently set for August 24, 2021.
California District Court Rules Antitrust Claims Against Hollywood Foreign Press Don’t Make Final Cut
On March 23, 2021, Judge Stanley Blumenfeld, Jr. of the United States District Court for the Central District of California dismissed amended antitrust claims brought by two entertainment journalists against the Hollywood Foreign Press Association (“HFPA”). Flaa v. Hollywood Foreign Press Ass’n, No. 2:20-cv-06974-SB (C.D. Cal. Mar. 23, 2021).
Ninth Circuit Reverses Class Certification Based On District Court’s Failure To Resolve Factual Issues Relating To Uninjured Class Members
On April 6, 2021, the United States Court of Appeals for the Ninth Circuit vacated a district court order certifying three classes in a multi-district antitrust case alleging a price-fixing conspiracy by producers of packaged tuna, finding that the district court erred in determining that plaintiffs had satisfied to the predominance requirement of Federal Rule of Civil Procedure 23(b)(3). Olean Wholesale Grocery Coop v. Bumble Bee Foods, No. 19-56514 (9th Cir. Apr. 6, 2021). Specifically, the Court concluded that the district court abused its discretion in declining to resolve whether plaintiffs’ proposed use of statistical evidence to establish classwide impact swept a substantial number of uninjured purchasers into the putative class. A class cannot be certified, the Court held, when it contains more than a “de minimis” number of uninjured purchasers.
Southern District Of New York Dismisses Antitrust Claims In U.S. Treasury Securities Action
On March 31, 2021, Judge Paul Gardephe of the United States District Court for the Southern District of New York granted defendants’ motions to dismiss antitrust claims alleging separate purported conspiracies to suppress competition in the trading of U.S. Treasury securities and to boycott competitive platforms for the trading of such securities. In re Treasury Sec. Auction Antitrust Litig., No. 1:15-md-02673-PGG (S.D.N.Y. Mar. 31, 2021). In so doing, the Court found that neither “statistical analyses” based on averages of all market participants’ conduct nor reports of government investigations was sufficient to plead the involvement in a conspiracy by an individual defendant that is required to overcome a motion to dismiss.
NCAA Athletes’ Case Goes To Highest Court In The Land: The Supreme Court Hears Argument On Sherman Act Challenge To NCAA Eligibility Rules On Compensation For Student-Athletes
On March 31, 2021, the United States Supreme Court heard oral argument in the consolidated cases National Collegiate Athletic Associate v. Alston
(No. 20-520) and American Athletic Conference v. Alston
(No. 20-512). These cases were previously covered as part of our preview of the current Supreme Court term
. Plaintiffs below – NCAA student-athletes – challenged the NCAA’s limits on education-related benefits to student athletes as unreasonable restraints on competition for the student-athletes’ services that violated Section One of the Sherman Act. After a lengthy trial, the district court agreed and entered an injunction in favor of plaintiffs. The Ninth Circuit affirmed, finding that the district court had properly applied the rule of reason to the challenged rules, that the rules had significant anticompetitive effects, and that plaintiffs had established that less restrictive alternatives to the existing rules were viable in that they were “virtually as effective” in achieving the procompetitive purposes of the joint venture. The case-specific issue presented to the Supreme Court is whether the Ninth Circuit erred in affirming the district court’s judgment that the NCAA eligibility rules regarding compensation of student-athletes violated the Sherman Act. But the case may have broader implications in how courts analyze a joint venture’s restraints on competition under the rule of reason, including how courts should evaluate claims that a defendant joint venture could have or should have used less restrictive means to accomplish its procompetitive goal.
Southern District Of New York Dismisses Competitor’s Sherman Act Claims Against Fintech Company For Lack Of Antitrust Standing
On March 31, 2021, Judge Mary Kay Vyskocil of the United States District Court for the Southern District of New York dismissed a ten-count complaint alleging that defendant financial technology companies, Advent Software Inc. and its parent company, SS&C Technologies Holdings Inc. (collectively “defendant”), violated, inter alia, Sections 1 and 2 of the Sherman Act by refusing to renew a software license with one of its competitors and engaging in so-called “exclusive dealing arrangements” that allegedly foreclosed the competitor from the marketplace. Arcesium, LLC v. Advent Software, Inc., 1:20-cv-04389 (MKV) (S.D.N.Y. Mar. 31, 2021). The Court found that plaintiff Arcesium LLC (“plaintiff”), a technology company that licensed defendant’s portfolio accounting software, but competed with them in providing related “post-trade solutions” (technology and services used to provide middle- and back-office support for investment funds and fund administrators), failed to adequately plead antitrust standing.
New Legislation In New York Addresses Expected Discontinuance Of LIBOR
On March 25, 2021, the New York State Legislature addressed the expected discontinuance of LIBOR by establishing that New York law-governed contracts without LIBOR fallback provisions will be deemed to use the replacement rate recommended by the Alternative Reference Rates Committee (ARRC). The legislation will take effect immediately once signed into law by Governor Cuomo, which is expected to take place in the coming days.
Second Circuit Rejects The “Nullity Doctrine” In Benchmarking Antitrust Case
On March 17, 2021, the Second Circuit vacated a district court’s dismissal of a putative class antitrust action, holding that the pre-lawsuit dissolution of the named plaintiffs does not render the action a legal nullity and deprive the court of subject matter jurisdiction, provided the assignee of their claims had standing to prosecute the claims as the real party in interest when the suit was filed and joins or substitutes into the action within a reasonable time. Fund Liquidation Holdings LLC v. Bank of Am. Corp., 2021 WL 1010596 (2d Cir. Mar. 17, 2021).
Maryland District Court Refuses To Send Poultry Workers’ Claims To Chopping Block In Wage Fixing Class Action
On March 10, 2021, Judge Stephanie Gallagher of the United States District Court for the District of Maryland denied defendants’ motions to dismiss antitrust claims brought by a putative class of poultry workers asserting that poultry processing companies unlawfully exchanged compensation data and conspired to fix and depress employee wages. Jien v. Perdue Farms, Inc., No. 1:19-CV-2521-SAG (D. Md. March 10, 2021).