D.C. Circuit Rejects FTC’s Appeal Related To Alleged Anticompetitive Conduct Stemming From Endo And Impax’s Patent Settlement Agreement, Holding It Was No Different From A Permissible Exclusive Licensing Agreement
On August 25, 2023, a panel of the United States Court of Appeals for the D.C Circuit affirmed the district court’s dismissal of the FTC’s complaint against Endo Pharmaceuticals Inc. (“Endo”), Impax Laboratories LLC (“Impax”) and their parent companies (collectively “Appellees”) for alleged violations of sections 1 and 2 of the Sherman Act. FTC v. Endo Pharmaceuticals Inc., et al., Dkt. No. 22-05137 (D.C. Cir. Aug. 25, 2023). The suit stemmed from a patent litigation settlement agreement in 2017, which the FTC alleged was an impermissible exclusive licensing arrangement. The D.C. Circuit held that the FTC failed to state a claim because the complaint lacked allegations establishing that the 2017 Agreement extended beyond the rights granted to Impax under settled law and precedent.
Direct Purchasers Defeat Merck’s Motion For Summary Judgment In Monopolization Case Involving Mumps Vaccine Products
On July 27, 2023, Judge Chad Kenney of the United States District Court for the Eastern District of Pennsylvania granted in part and denied in part Merck’s motion for summary judgment in relation to a class action alleging that direct purchasers of Merck’s mumps vaccines were overcharged as a result of Merck’s alleged unlawful monopolization of the mumps vaccine market in violation of Section 2 of the Sherman Act and New Jersey and New York state laws. In re Merck Mumps Vaccine Litig., No. 12-3555 (E.D. Pa. July 27, 2023). Plaintiffs allege that Merck’s submissions to the FDA and its labels for its mumps vaccines contained false and misleading information in relation to the amount of live virus in its products. According to plaintiffs, this led to competitors being forced to comply with unusual standards to receive FDA approval to market their products, and specifically, it precluded GSK from obtaining a license to sell its vaccine for mumps, measles and rubella (MMR vaccine) and caused plaintiffs to be overcharged.
Broadway Producer’s Antitrust Claims Against Actors’ Union Barred By Federal Exemption
On April 14, 2023, the United States District Court for the Southern District of New York dismissed a suit brought by Garth Drabinsky, an award-winning Broadway producer, against an actors’ union, the Actors’ Equity Association (“AEA”), for allegedly blacklisting him in violation of Sections 1 and 2 of the Sherman Act. The Court dismissed the suit with prejudice, holding that Drabinsky’s federal antitrust claims were barred by the statutory exemption for unions. Drabinsky v. Actors’ Equity Association, No. 22-CV-8933-LGS (S.D.N.Y.).
Amazon Wins Motion To Dismiss Antitrust Suit Because Plaintiffs Lacked Antitrust Injury
On April 20, 2023, Judge Ricardo Martinez of the United States District Court for the Western District of Washington dismissed with leave to amend a putative class action alleging that Amazon’s linking of favorable website product placement for third-party sellers with the third-party sellers’ purchases of Amazon’s fulfillment services was an unlawful tying arrangement under Sections 1 and 2 of the Sherman Act. Hogan v. Amazon.com, Inc., No. 21-996 (W.D. Wash. Apr. 20, 2023). Plaintiffs were members of Amazon Prime, an Amazon program offering free or reduced shipping on purchases through Amazon, among other benefits, in exchange for an annual fee. Plaintiffs alleged that third-party sellers who purchase Amazon’s fulfillment services receive a “Prime Badge” and favorable product placement on Amazon’s website in the “Buy Box,” the section of the product page through which plaintiffs claimed 90% of Amazon.com consumer purchases are made.
Western District Of Washington Trims Some Claims, Keeps Others, In Most-Favored-Nation Litigation Against Amazon
On March 23, 2023, the United States District Court for the Western District of Washington partially granted and partially denied Amazon’s motion to dismiss a putative consumer class action alleging Amazon’s policies have prevented third-party sellers from offering lower prices on other e-commerce platforms. Frame-Wilson, et al. v. Amazon.com, Inc., No. 2:20-cv-00424-RAJ, 2023 WL 2632513 (W.D. Wash. Mar. 23, 2023).
Central District Of California Nixes Streaming Platform’s Cartel Claims Against Popular Comedians
On April 5, 2023, Judge Mark C. Scarsi of the Central District of California dismissed with prejudice a streaming service’s antitrust counterclaims alleging that various well-known comedians and their licensing agents conspired to fix prices and attempted to monopolize the market for spoken-word comedic audio content for failure to allege facts showing either an agreement in restraint of trade in violation of Section 1 of the Sherman Act or the market power necessary to state a claim under Section 2. Yellow Rose Productions Inc. v. Pandora Media LLC, No. 2:22-cv-00809 (C.D. Cal, Apr. 5, 2023).
Northern District Of California Dismisses Class Action Suit Against Social Networking Company Without Prejudice, Rejecting An Argument That Failing To Share Data Constitutes Anticompetitive Conduct
On March 8, 2023, Judge Haywood S. Gilliam, Jr. of the United States District Court for the Northern District of California granted a motion to dismiss a proposed antitrust class action lawsuit alleging that social networking company (the “Company”) has a monopoly in the professional social networking market, which it protects through a barrier to entry comprising the Company’s “data centralization and aggregation, its machine learning and AI infrastructure, and the inferred data it produce[s].” Crowder et al. v. LinkedIn Corporation, No. 22-cv-00237-HSG (N.D. Cal., Mar. 8, 2023). Plaintiffs alleged the Company violated Sections 1 and 2 of the Sherman Act by engaging in a “monopoly broth” of anticompetitive conduct, ranging from exclusive data sharing agreements to an alleged agreement with Facebook to divide markets. Granting the motion to dismiss, the Court ruled that none of the alleged activities amounted to anticompetitive conduct, either individually or on aggregate.
Department Of Justice And State Attorneys General Sue Google For Alleged Monopolization Of Digital Advertising Technologies
On January 24, 2023, the Department of Justice, along with the Attorneys General of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee, and Virginia, filed a civil antitrust action against Google in the United States District Court for the Eastern District of Virginia. Plaintiffs allege that Google violated Sections 1 and 2 of the Sherman Act by monopolizing several digital-advertising products. These products are various software programs and exchanges used by advertisers to create ads and place them on websites, including as search results on Google. When someone uses Google’s search engine, they are not only inundated with popular search-engine results but with relevant advertisements. In addition to search-engine advertisements, Google’s tools are used by third-party websites to promote digital advertising. Plaintiffs contend that website publishers rely on Google’s digital-advertising products to sell advertisements and that advertisers depend on them to purchase advertisements.
Fifth Circuit Rejects Hospital Operator’s Antitrust Claims Against Dominant Medical Provider In Shreveport, Louisiana
On September 19, 2022, the United States Court of Appeals for the Fifth Circuit held that the operator of a hospital in Shreveport, Louisiana had failed to adequately plead Sherman Act § 1 and § 2 claims against the dominant medical provider in the Shreveport market. BRFHH Shreveport, LLC v. Willis-Knighton Medical Center, No. 21-30622 (5th Cir. Sep. 19, 2022).
Generic Drug Manufacturer Barred From Bringing “Sham” Litigation Claim By Previous Settlement
On July 21, 2022, the United States Court of Appeals for the Third Circuit unanimously affirmed a district court judge’s conclusion that a prior settlement released a claim by plaintiff, a generic pharmaceutical manufacturer (the “Company”), that defendants engaged in “sham” patent litigation to block it from launching a generic version of defendants’ brand-name drug. Perrigo Co, et al. v. AbbVie Inc, et al., No. 21-3026 (3d Cir. Jul. 21, 2022).
Seventh Circuit Reverses Dismissal Of Monopolization Claim, Holding That Plaintiff Adequately Pled A Relevant Geographic Healthcare Market Under The “Hypothetical Monopolist” Test
On July 8, 2022, the United States Court of Appeals for the Seventh Circuit reversed the district court’s dismissal of a monopolization claim against an integrated healthcare provider, concluding that plaintiff had pled facts sufficient to support a plausible geographic market as required to establish a claim under section 2 of the Sherman Act and section 7 of the Clayton Act. Vasquez v. Indiana Univ. Health, Inc., No. 21-3109, 2022 WL 2582368 (7th Cir. July 8, 2022).
Round 2: Fifth Circuit Dismisses Antitrust Claims Against Standard-Essential Patent Holders, Withdrawing Prior Opinion Finding Plaintiff Lacked Standing
On June 21, 2022, the United States Court of Appeals for the Fifth Circuit affirmed a decision dismissing Plaintiff Continental Automotive Systems’ claims challenging the alleged refusal of certain standard-essential patent holders and their licensors to issue the supplier patents on fair, reasonable, and nondiscriminatory (“FRAND”) terms under Section 1 and 2 of the Sherman Act. Continental Automotive Sys., Inc. v. Avanci, L.L.C., No. 20-11032 (June 21, 2022).
No “Sham,” No Foul: Mattress Companies’ Agency Petitions Immune From Antitrust Liability, Finds District Of Utah
On May 23, 2022, Judge David Barlow of the District of Utah dismissed claims against a group of mattress manufacturers who had filed antidumping petitions with federal regulators. CVB, Inc. v. Corsicana Mattress Company, et al., No. 1:20-cv-00144 (D. Utah 2022). Plaintiff alleged that defendants engaged in anticompetitive conduct including price fixing and interference with plaintiff’s business relationships in violation of the Sherman Act and the Utah Antitrust Act, in addition to Lanham Act and state common law claims. The Court dismissed all claims, and in particular dismissed with prejudice those claims relating to defendants’ antidumping petitions, which it found protected under the Noerr-Pennington doctrine.
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).
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.
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.
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).
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).
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.
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.
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).
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”).
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).
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).
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.
Third Circuit Dismisses Sherman Act And RICO Claims Against Certification Board
On February 25, 2021, the United States Court of Appeals for the Third Circuit affirmed a district court’s ruling that the American Board of Internal Medicine (“defendant”) did not violate Sections 1 and 2 of the Sherman Act or the Racketeer Influenced and Corrupt Organizations Act (“RICO”). Kenney v. Am. Bd. of Internal Med., No. 20-1007, 2021 WL 732715 (3d Cir. Feb. 25, 2021). Among other things, the Third Circuit found that a group of physicians (“plaintiffs”) did not plausibly allege that defendant impermissibly tied together initial physician certifications with the regular renewals of the same certifications. These regular renewals are known as maintenance of certification (“MOC”). The Third Circuit also found that plaintiffs did not plausibly allege that defendant utilized monopoly power to require plaintiffs to purchase MOCs.
Central District Of California Dismisses Sherman Act Claims Involving Alleged Los Angeles Outdoor Advertising Market
On November 9, 2020, the United States District Court for the Central District of California granted defendant Outfront Media Inc.’s (“Outfront”) motion to dismiss claims that Outfront engaged in an illegal conspiracy to stifle competition and maintain “monopolistic control” over the alleged market for outdoor advertising (billboards) in Los Angeles. Karraa v. City of Los Angeles, No. 2:20-cv-07036-SVW-AGR (C.D. Cal. Nov. 9, 2020). The Court found that plaintiffs, including rival outdoor advertising company Virtual Media Group, Inc. (“VMG”) and the ground lessors of billboard sites, did not plead facts to establish a violation of either Section 1 or Section 2 of the Sherman Act.
Northern District Of California Engages In Tech Companies’ Fortnite Battle
On October 9, 2020, Judge Yvonne Gonzalez Rogers of the United States District Court for the Northern District of California granted in part and denied in part Epic Games’ motion for preliminary injunction against Apple, Inc. Epic Games, Inc. v. Apple Inc. , No. 4:20-cv-05640-YGR (N. D. Cal. 2020). Plaintiff Epic Games (“Epic”) sought to reinstate its popular video game, Fortnite, to the Apple App Store and to regain its access to Apple’s developer tools. The Court declined to reinstate Fortnite to Apple’s App Store, but ordered Apple to allow Epic’s corporate affiliates access to its developer tools.
Tech Startup’s Antitrust Claims Against Professional Networking Site Don’t Get The Job Done
On September 9, 2020, Judge Edward Chen of the United States District Court for the Northern District of California dismissed antitrust claims brought against LinkedIn by a tech startup that alleged LinkedIn exploited its monopoly power to deny the startup access to essential information it uses in providing analytics services. hiQ Labs, Inc. v. LinkedIn Corp., No. 17-cv-03301-EMC (N.D. Cal. Sept. 9, 2020).
U.S. District Court Dismisses Auto Parts Maker’s Antitrust Claims Against Wireless Patent Pool
On September 10, 2020, Chief Judge Barbara M. G. Lynn of the U.S. District Court for the Northern District of Texas dismissed a major automotive components manufacturer’s antitrust lawsuit against a group of holders of standard-essential patents (“SEPs”) used in wireless telecommunications and their joint licensing agent Avanci LLC, rejecting claims that defendants’ patent licensing platform and practices violated, inter alia, Sections One and Two of the Sherman Act. Continental Automotive Systems, Inc. v. Avanci, LLC, No. 3:19-cv-02933-M (N.D. Tx. Sept. 10, 2020). In dismissing the case, the Court found that plaintiff had failed to adequately plead (1) antitrust standing, (2) an unlawful agreement to restrain trade under Section One, and (3) the anticompetitive conduct necessary to establish a violation of Section Two. On the monopolization claim, this decision is consistent with the Ninth Circuit’s decision last month in FTC v. Qualcomm Inc., in which the Ninth Circuit reversed the district court and rejected similar Section Two challenges to Qualcomm’s licensing practices for its SEPs. It is also consistent with the U.S. Department of Justice Antitrust Division’s July 28, 2020 favorable business review letter addressing Avanci’s 5G patent licensing platform.
Eastern District Of Virginia Wades Into “Grey Area”; Certifies Class Of Thirty-Five Direct Purchaser Plaintiffs
On August 21, 2020, Judge Rebecca Beach Smith of the United States District Court for the Eastern District of Virginia certified a class of thirty-five direct purchasers. In Re Zetia (Ezetimibe) Antitrust Litigation, 19-cv-00014 (E.D. Va. Aug. 21, 2020). Plaintiffs, direct purchasers of the branded drug Zetia, alleged that defendant pharmaceutical manufacturers engaged in an unlawful reverse-payment settlement whereby the manufacturer of the branded drug Zetia agreed to pay a generic manufacturer approximately $800 million to delay its launch of a generic for Zetia for nearly five years. Zetia is a drug that prevents cholesterol by inhibiting the buildup of plaque in arteries. The issue before the district court was whether Rule 23 class certification was proper of a direct-purchaser class of only thirty-five members. In finding it was, the court found it credible that many class members would not find it financially worthwhile to pursue the case on their own and that judicial economy would be best served by certification.
When “Killing Competition” Isn’t Anticompetitive: Federal Circuit Affirms Dismissal Of Power Grid Tech Company’s Antitrust Claims Against Rival Firms
On July 13, 2020, the United States Court of Appeals for the Federal Circuit affirmed the Central District of California’s dismissal of a suit brought by a power systems software company against three competitor corporations on grounds that plaintiff’s claims failed to adequately allege anticompetitive conduct under the Sherman Act and related state law claims. Power Analytics Corp. v. Operation Tech., Inc. et al., No. 19-1805 (Fed. Cir. July 13, 2020).
Northern District Of Illinois Dismisses Antitrust Claims Relating To World’s Most Profitable Drug—Humira (Adalimumab)
On June 8, 2020, Judge Manish Shah of the United States District Court for the Northern District of Illinois (Eastern Division) granted AbbVie’s motion to dismiss plaintiff’s Sherman Act claims because the allegations fell “short of alleging the kind of competitive harm remedied by antitrust law.” In re Humira (Adalimumab) Antitrust Litigation, No. 1:19-cv-01873 (N.D. Il. 2020). Plaintiffs are two separate classes of indirect purchasers in a consolidated class action alleging that pharmaceutical manufacturer AbbVie, in concert with competing biosimilar manufacturers (Amgen, Samsung Bioepis, and Sandoz), violated §§ 1 and 2 of the Sherman Act by improperly exercising monopoly power over the market for the drug Adalimumab.
Northern District Of Texas Rejects Walker Process And Sham Patent Litigation Antitrust Claims For Lack Of Standing Based On Failure To Show Causation
On April 13, 2020, Judge Reed O’Connor of the United States District Court for the Northern District of Texas granted defendants’ motion for summary judgment on plaintiffs’ monopolization claim based on plaintiffs’ failure to present substantial evidence that fraud on the Patent Office and subsequent sham litigation were a material cause of plaintiffs’ alleged lost profits. Chandler et al v. Phoenix Services LLC, 19-cv-00014 (N.D. Tex. April 13, 2020). With regard to plaintiffs’ claims for fees and costs expended in defending the sham litigation, the Court found that these claims were barred by the statute of limitations.
Central District Of California Allows Sherman Act Claims Against Performing Rights Organization To Proceed But Strikes Claims For Monetary Relief
On February 13, 2020, Judge Terry Hatter of the United States District Court for the Central District of California issued an order denying Defendant Global Music Rights LLC (GMR)’s motion to dismiss antitrust claims based on its licensing practices, but striking all claims for restitution or disgorgement of profits. Radio Music License Committee Inc. v. Global Music Rights LLC, 19-cv-03957 (C.D. Cal. February 13, 2020).
D.C. District Court Denies Motion To Dismiss FTC Monopolization Claim Based On Loyalty Discount Program And Exclusive Dealing Arrangements
On January 17, 2020, District Judge John D. Bates of the United States District Court for the District of Columbia denied defendant’s motion to dismiss an FTC complaint alleging monopolization in violation of Section 2 of the Sherman Act against a health information technology company (the “Company”), rejecting the Company’s arguments that the Court lacked subject matter jurisdiction under Section 13(b) of the FTC Act, and finding that FTC had adequately pleaded a Section 2 violation. FTC v. Surescripts LLC, 19-1090 (D.D.C. Jan. 17, 2020).
Southern District Of New York Dismisses “Truly Novel” Restraint Of Trade Theory In Pharmaceutical Antitrust Action
On October 8, 2019, United States District Judge for the Southern District of New York Ronnie Abrams dismissed all but one claim in a putative antitrust class action brought against Takeda Pharmaceutical Company Ltd. and various Takeda entities, as well as generic manufacturers Teva Pharmaceuticals, Ranbaxy Pharmaceutical Industries Ltd., Actavis PLC, and Mylan Inc. In re: Actos Direct Purchaser Antitrust Litigation, No. 1:15-cv-03278 (S.D.N.Y. Oct. 8, 2019). The class complaint alleged that Takeda illegally conspired with the other defendants to delay generic competition for its blockbuster diabetes drug Actos through a series of patent settlement agreements, which granted the other defendants non-exclusive licenses to produce generic Actos at a future date prior to the expiration of Takeda’s patents. The Court dismissed these conspiracy claims, finding that plaintiffs’ “truly novel” theory for why the settlement agreements between Takeda and the other defendants violated the antitrust laws lacked “even a colorable basis” of support. The Court’s decision left in place one remaining claim against Takeda for monopolization.
Second Circuit Finds District Court Failed To Properly Consider Two-Sided Markets In Travel Platform Suit, Voids $15M Antitrust Verdict
On September 11, 2019, the United States Court of Appeals for the Second Circuit, in a panel consisting of Judges Robert D. Sack, Debra Ann Livingston and Denny Chin, affirmed in part, reversed in part and vacated in part a lower court’s decision in an antitrust action related to contracts for a travel technology platform. US Airways, Inc., for American v. Sabre Holdings Corporation, No. 17-960 (2d Cir. Sept. 11, 2019). The Second Circuit held that the district court had erred in failing to find the relevant market to be two-sided as a matter of law. The case was remanded for a new trial on the substantive question of whether certain contractual provisions in the business agreements between the parties were unlawful restraints of trade in violation of Sections 1 and 2 of the Sherman Act.
Seventh Circuit Allows Beer Conspiracy Allegations One More Shot
On September 5, 2019, Judge Kenneth Ripple, writing for a unanimous panel of the U.S. Court of Appeals for the Seventh Circuit, partially reversed a lower court’s dismissal of antitrust claims alleging that two brewers conspired to restrict a competitor’s exports of beer to Ontario, Canada. Mountain Crest SRL, LLC v. Anheuser-Busch InBev SA/NV, No. 18-2327, 2019 WL 4198809 (7th Cir. Sept. 5, 2019). The Seventh Circuit held that agreements with a Canadian government-controlled entity (the Liquor Control Board of Ontario, or “LCBO”) were immune from antitrust scrutiny under the act of state doctrine. However, the Court held that claims of an alleged conspiracy between competitors to strong-arm the LCBO into entering into the agreements did not implicate the act of state doctrine and were improperly dismissed.
Second Circuit Affirms Dismissal Of Price Fixing Claims Against Oil Companies
On August 29, 2019, the United States Court of Appeals for the Second Circuit issued an Opinion and Summary Order affirming the dismissal of plaintiffs-appellant derivatives traders’ Sherman Act and Commodities Exchange Act claims against defendant-appellees oil companies. Prime International Trading, Ltd., et al. v. BP PLC, et al., No. 1:17-cv-2233 (2d Cir. 2019).
Seventh Circuit Extinguishes Antitrust Conspiracy Claims About Local Fire Alarm Laws
On July 15, 2019, the Seventh Circuit Court of Appeals dismissed claims alleging an antitrust conspiracy between a local municipality, an intergovernmental cooperation association and a private provider of commercial fire-alarm services. Alarm Detection Sys., Inc. v. Vill. of Schaumburg, No. 18-3316, 2019 WL 3071744 (7th Cir. July 15, 2019). The Court held that plaintiffs failed to plausibly plead the existence of an underlying agreement between defendants as required to plead an antitrust conspiracy claim.
Third Circuit Affirms Dismissal In Favor Of Defendant Internet Service Provider By Disconnecting Monopsony And Conspiracy Claims
On April 19, 2019, the Third Circuit Court of Appeals affirmed the Middle District of Pennsylvania’s dismissal of monopsony, antitrust conspiracy, and race discrimination claims by two plaintiff cable installer contractors against defendant, a dominant provider of internet services. Cable Line, Inc. v. Comcast Cable Communications of Pennsylvania, Inc., No. 18-2316 (3d Cir. Apr. 19, 2019). On the antitrust claims, the Third Circuit held that plaintiffs did not adequately allege facts to show that they suffered antitrust injury from the allegedly anticompetitive conduct, that defendant held monopsony power and used it to exclude other buyers of cable installation services, or that defendant had any agreement with the installers it chose as part of its RFP process to restrain trade in the cable installation market. The Third Circuit did, however, suggest that plaintiffs consider a retooled complaint alleging that defendant ties cable installation to its cable services, which may cause higher installation prices and reduce downstream competition.
United States District Court For The Northern District Of California Focuses On Information Sharing To Magnify Anticompetitive Conspiracy In Antitrust Suit Against Telescope Manufacturers
On March 29, 2019, Judge Edward J. Davila of the U.S. District Court for the Northern District of California denied a motion to dismiss, finding that plaintiff Orion Telescopes & Binoculars (“Orion”) had sufficiently pled that defendants Ningbo Sunny Electronic Co., Ltd. (“Ningbo”) and Celestron, LLC (“Celestron”) had conspired to divide the market for low- to medium-end telescopes and block a competing manufacturer’s acquisition that would have enabled expansion and broader supply-side competition. Optronic Technologies, Inc., v. Ningbo Sunny Electronic Co., Ltd., No. 16-CV-6370 (N.D. Cal. Mar. 29, 2019). Judge Davila cited plaintiff’s specific allegations of: (a) a division among competitors of the low-end (to Ningbo) and high-end (to Celestron) telescope markets (facilitated in part by a transfer of intellectual property to Ningbo); and (b) Celestron’s advance knowledge of Ningbo’s interest in the merger. Celestron settled prior to the litigation, but Orion and Ningbo will continue into discovery.
United States District Court For The District Of Delaware Dismisses Allegations Of Anticompetitive Drone Pricing
On March 18, 2019, Judge Leonard P. Stark of the U.S. District Court for the District of Delaware dismissed allegations of predatory pricing in the “prosumer” drones market by DJI Technology Co., Ltd. and DJI Europe B.V. (collectively “DJI”). SZ DJI Technology Co., Ltd. v. Autel Robotics USA LLC, No. 16-706-LPS (D. Del. Mar. 18, 2019). The Court ruled in favor of the DJI plaintiffs, who were defendants in the antitrust counterclaims in the suit, finding that defendants Autel Robotics USA LLC and Autel Aerial Technology Co., Ltd. (collectively “Autel”) did not allege sufficient facts for a plausible predatory pricing claim. In particular, the Court found that Autel failed to show that DJI’s prices were below cost.
Delaware District Court Dismisses Antitrust Suit Against Lab Testing Company Alleging Conspiracy To Exclude Smaller Lab From Market
On February 14, 2019, Judge Maryellen Noreika of the United States District Court for the District of Delaware dismissed a complaint alleging violations of Sections 1 and 2 of the Sherman Act. Prescient Medicine Holdings, LLC v. Laboratory Corporation of America Holdings et al, No. 1:18-cv-00600 (D. Del. Feb 14. 2019). The complaint was filed by Prescient Medicine Holdings, LLC, a provider of laboratory testing services. Plaintiff alleged that an agreement between a competitor laboratory testing service—Laboratory Corporation of America and Laboratory Corporation of America Holdings (“LabCorp”)—and a managed care organization—AmeriHealth, Inc. and AmeriHealth Caritas Delaware Inc. (“AmeriHealth”) was a collusive scheme to monopolize the in-network Medicaid market and exclude plaintiff from that market. Judge Noreika held that plaintiff failed to adequately plead antitrust standing and failed to define a relevant market.
Ninth Circuit Reinstates $53 Million Jury Award Against Supplier In “Refusal to Deal” Monopolization Action
On February 8, 2019, a three-judge panel of the United States Court of Appeals for the Ninth Circuit reversed the district court and reinstated a jury verdict that found a cigar manufacturer liable for attempted monopolization under Section Two of the Sherman Act for various actions it took or refused to take in connection a contract manufacturing relationship with a competitor. Trendsettah USA, Inc. v. Swisher Int’l, Inc., No. 16-56823 (9th Cir. Feb. 8, 2019). The decision is notable in allowing the imposition of Sherman Act liability for conduct that amounted largely to alleged breaches of, and a refusal to renew, a supply contract, and illustrates that potential claims under Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585 (1985), still pose litigation risks for firms with significant market shares that terminate profitable relationships with their competitors.
United States District Court For The Eastern District of New York Rejects One-Sided Market And Single-Brand Market Definitions In Credit Card Antitrust Litigation
On January 14, 2019, Judge Nicholas G. Garaufis of the U.S. District Court for the Eastern District of New York granted defendant American Express’ motion for summary judgment as to three of the four relevant markets proposed by the plaintiffs in their antitrust challenge to the “anti-steering” provisions in American Express’s merchant contracts. In re American Express Anti-Steering Rules Antitrust Litigation, No. 11-MD-2221 (NGG) (RER) (E.D.N.Y. Jan. 15, 2019). Following the U.S. Supreme Court’s 2018 decision in a parallel challenge to the same contractual provisions by the U.S. Department of Justice (“DOJ”) and several states, Ohio v. American Express Company, 138 S. Ct. 2274 (2018), Judge Garaufis rejected the retail merchant plaintiffs’ proposed product market definitions that were limited to the merchant side of card transactions, i.e., the “one-sided” markets, finding that the Supreme Court’s decision required an examination of competition on both sides of the credit card platform – the cardholder side and the merchant side – i.e., the “two-sided” market. The court also rejected the plaintiffs’ attempt to limit the relevant product market to American Express card transactions (the “Amex-only market”) because other general purpose credit and charge cards are reasonably interchangeable with American Express cards and therefore in the same relevant product market. American Express did not move for summary judgment on the plaintiffs’ two-sided, all general purpose credit card market definition, and the case will proceed to trial on that theory.