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.
Oregon District Court Allows Claim Against Association Of Colleges And Universities To Proceed And Accepts Harm To Defendant’s Members As Evidence Of Antitrust Injury
On November 28, 2018, Judge Marco A. Hernández of the United States District Court for the District of Oregon, on remand from the Ninth Circuit, reversed its prior grant of a motion to dismiss and held that plaintiff — which brought antitrust conspiracy claims against a non-profit corporation made up of 549 member colleges — sufficiently demonstrated antitrust injury by alleging harm to the member colleges. CollegeNET, Inc. v. The Common Application, Inc., No. 3:14-CV-00771-HZ (D. Or. Nov. 28, 2018).
District Of Columbia Releases Redacted Opinion Detailing Reasoning Behind Decision To Grant Preliminary Injunction In Tronox-Cristal Acquisition
On September 5, 2018, Judge Trevor N. McFadden of the United States District Court for the District of Columbia granted the Federal Trade Commission’s request for a preliminary injunction preventing Tronox Ltd. (“Tronox”) from completing its proposed $2.4 billion acquisition of National Titanium Dioxide Company Ltd. (“Cristal”) until after a final ruling in the FTC’s administrative proceedings challenging the deal. Federal Trade Commission v. Tronox Ltd., et al., 1:18-cv-01622 (TNM) (D.D.C. Sept. 12, 2018).Tronox intends to appeal and will consider whether to proceed with a divestiture to resolve potential competitive concerns.
United States Supreme Court Upholds Rejection Of The Government’s Antitrust Challenge To American Express’s Merchant Contracts
On June 25, 2018, the U.S. Supreme Court, in a 5-4 decision by Justice Thomas, held that provisions in American Express Company’s (“American Express” or “Amex”) and its operating subsidiary’s contracts with merchants that restricted the ability of these merchants to steer customers to other credit or charge cards did not violate the Sherman Act. Ohio v. Am. Express Co., 585 U.S. __, slip op. at 1 (2018). The Court held that plaintiffs—the United States Department of Justice and the Attorneys General of several states—failed to satisfy their burden of proving anticompetitive effects in the relevant market under the rule of reason. Id. at 10. The ruling has important implications for antitrust analysis, not only for the credit card industry, but for other industries that operate in two-sided markets where firms must compete simultaneously for different groups of customers whose demands are distinct but deeply interrelated.
U.S. District Court For The District Of New Jersey Dismisses Class Action For Failure To Identify Concerted Action And Relevant Market
01/23/2018On January 9, 2018, Judge William J. Martini of the United States District Court for the District of New Jersey dismissed with prejudice a putative class action brought by a purchaser of Jaguar vehicles against Jaguar Land Rover North America LLC, Jaguar Land Rover Limited (collectively, the “manufacturer defendants”), their dealers, and a third-party consulting company. Baar v. Jaguar Land Rover North Am., LLC, et al., No. 2:17-04142 (D.N.J. Jan. 9, 2018). Plaintiff alleged that defendants unreasonably restrained trade by implementing and enforcing a no-export agreement that prohibited purchasers from reselling Jaguar’s vehicles abroad for at least one year. The Court held that the plaintiff’s complaint failed to state a violation of federal or state antitrust laws because it did not adequately allege (1) concerted action among the defendants, or (2) that Jaguar’s no-export policy produced anticompetitive effects within a cognizable antitrust product and geographic market.
United States District Court For The District Of Maryland Grants Summary Judgment To Non-Practicing Entity Intellectual Ventures Against Monopolization Counterclaims Alleging Sham Patent Litigation
On November 30, 2017, Judge Paul W. Grimm of the United States District Court for the Southern Division of the District of Maryland granted Intellectual Ventures (“IV”) and affiliates’ motion for summary judgment on Capital One’s antitrust counterclaims based on IV’s alleged bad faith assertion of patent claims, concluding that Capital One’s antitrust counterclaims were barred by both Noerr-Pennington immunity and collateral estoppel. Intellectual Ventures I LLC et al v. Capital One Financial Corp., 8-14-cv-00111 (MDD 2017-12-01, Order). The Court’s thorough and careful opinion is a good illustration of the challenges of litigation over the conduct of a non-practicing patent-assertion entity, or as some would have it, a patent troll, under the Sherman Act.
Sixth Circuit Holds That Homeowners Stated A Plausible Tying Claim Against Neighborhood Developers For Tying Purchase Of Telecommunications Services To The Sale Of Homes
On October 30, 2017, a divided panel of the United States Court of Appeals for the Sixth Circuit reversed a district court’s denial of plaintiffs’ motion to file an amended complaint alleging that the defendants—a group of affiliated real estate development companies—illegally used their alleged market power in the sale of homes in three centrally planned neighborhoods to force the plaintiffs to purchase telecommunication services from another defendant, Crystal Clear Technologies, LLC, a telecommunications company that the developers owned and controlled. Cates v. Crystal Clear Technologies, LLC, No. 16-6714 (6th Cir. Oct. 30, 2017). The majority affirmed, however, the district court’s dismissal of the plaintiffs’ claim that the arrangement between Crystal Clear and the defendant developers violated the Federal Communications Commission’s “Exclusivity Order” (In the Matter of Exclusive Service Contracts For Provision Of Video Services In Multiple Dwelling Units and Other Real Estate Developments, 22 FCC Rcd. 20235, 20251 (2007), 47 C.F.R. § 76.2000(a)), which prohibits cable television distributors from entering into exclusive contracts to provide video programming, on the grounds that the complaint and contracts themselves contradicted the allegation that the contracts were in fact exclusive.
9th Circuit Upholds Grant Of Summary Judgment In Favor Of UPS And FedEx In Antitrust Suit Brought By Third-Party Shipping Rate Consultant
On August 21, 2017, in an unpublished, split panel decision, the Ninth Circuit affirmed U.S. District Judge Jesus G. Bernal’s decision granting summary judgment in favor of UPS and FedEx on AFMS LLC’s antitrust suit under § 1 of the Sherman Act. AFMS, a firm that offered rate negotiation and consulting services for package shippers, alleged that UPS and FedEx conspired to boycott third-party consultants such as AFMS who negotiated rates for their customers, including by threatening to discontinue the rate discounts for any shippers who continued to use intermediaries. After providing AFMS with three opportunities to amend its complaint, the U.S. District Court finally dismissed the claims with prejudice in April 2015 because AFMS had not properly defined a market impacted by the alleged agreement.
Southern District Of New York Dismisses Oil Price Manipulation Claims Based On Failure To Adequately Allege Antitrust Injury Linked To Defendants’ Alleged Conduct
On June 8, 2017, Judge Andrew L. Carter of the United States District Court for the Southern District of New York granted defendant energy companies’ motion to dismiss claims brought by two putative classes of derivatives traders and landowners, finding that plaintiffs failed to sufficiently allege that they suffered an antitrust injury linked to defendants’ alleged conduct in the relevant markets. In re: North Sea Brent Crude Oil Futures Litigation, Case No. 1:13-md-02475 (S.D.N.Y. Jun. 8, 2017). Plaintiffs, a putative class of landholding interests in U.S. oil-producing property and a putative class of futures and derivatives traders, alleged that defendants conspired to intentionally manipulate Brent crude oil prices and the prices of Brent crude oil futures and derivatives contracts traded on the New York Mercantile Exchange (“NYMEX”) and the Intercontinental Exchange (“ICE Futures Europe”) in violation of the Sherman Act (as well as other federal and state laws). Brent crude is crude oil pulled from the North Sea region of Europe. In dismissing the Sherman Act claims, the district court found that plaintiffs had not suffered any antitrust injury, and therefore did not have standing as plaintiffs under Section 4 of the Clayton Act.