Justia Antitrust & Trade Regulation Opinion Summaries

Two psychiatrists challenged the practices of the American Board of Psychiatry and Neurology (ABPN), alleging that ABPN unlawfully tied its specialty certification to its maintenance of certification (MOC) product, thereby violating antitrust law and causing unjust enrichment. The plaintiffs argued that ABPN’s monopoly over specialty certifications forced doctors to purchase the MOC product, which includes both activity and assessment requirements, in order to maintain their professional standing and employment opportunities. They claimed that the MOC product functioned as a substitute for other continuing medical education (CME) products required for state licensure, and that this arrangement harmed competition in the CME market.The United States District Court for the Northern District of Illinois dismissed the plaintiffs’ second amended complaint with prejudice. The district court found that the plaintiffs failed to plausibly allege an illegal tying arrangement under Section 1 of the Sherman Act, specifically because they did not show that ABPN’s MOC product was a viable substitute for other CME products. The court also concluded that the plaintiffs had multiple opportunities to amend their complaint and had not demonstrated how further amendment would cure the deficiencies.On appeal, the United States Court of Appeals for the Seventh Circuit reviewed the dismissal de novo and affirmed the district court’s decision. The Seventh Circuit held that the plaintiffs did not plausibly allege that psychiatrists and neurologists view ABPN’s MOC product as reasonably interchangeable with other CME offerings. The court found that, even if MOC participation could partially or fully satisfy state CME requirements, the additional time, cost, and effort required by the MOC program made it implausible that doctors would choose MOC over other CME products. The court also upheld the district court’s decision to dismiss the complaint with prejudice, finding no abuse of discretion. View "Lazarou v. American Board of Psychiatry and Neurology" on Justia Law

A company that supplies allergy testing materials and personnel to primary-care physicians in Tennessee alleged that several insurers and a dominant allergy-care medical group conspired to drive it and its contracting physicians out of the market. The company provided technicians and supplies to physicians, who then billed insurers for allergy services. The company claimed that the insurers and the medical group coordinated audits, denied claims, and set restrictive reimbursement policies, which led physicians to stop using its services and caused it financial harm.The United States District Court for the Eastern District of Tennessee dismissed the company’s federal antitrust claims at the pleading stage, finding it lacked standing to sue under the antitrust laws, and later granted summary judgment to the defendants on the company’s state-law tort claims. The company appealed both the dismissal of its antitrust claims and the grant of summary judgment on its tort claims.The United States Court of Appeals for the Sixth Circuit affirmed the district court’s decisions. The Sixth Circuit clarified that, under federal antitrust law, a plaintiff must show both antitrust injury and proximate causation. The court held that the company’s injuries were only indirect, as they resulted from harms inflicted on the physicians, who were the direct victims of the alleged anticompetitive conduct. Applying the Supreme Court’s rule from Illinois Brick Co. v. Illinois, the court found that indirect sellers—those two or more steps removed in the distribution chain—may not sue for antitrust violations. The court also affirmed summary judgment on the state-law claims, concluding that the company failed to show either malice or causation as required for tortious interference, and that its civil conspiracy claim could not survive without an underlying tort. View "Academy of Allergy & Asthma in Primary Care v. Amerigroup Tennessee, Inc." on Justia Law

A fuel distribution company sought to acquire a competitor in Western Alaska, prompting the State to sue for anticompetitive conduct under Alaska’s consumer protection laws. To resolve the dispute, the State and the company negotiated a consent decree requiring the company to divest a portion of its fuel storage capacity in Bethel to another distributor, Delta Western, before completing the acquisition. The consent decree specified that it would expire in 30 years or could be dissolved by court order for good cause. Delta Western was not a party to the consent decree, but entered into a separate fuel storage contract with the acquiring company as required by the decree. The contract’s term extended beyond the initial five years at Delta Western’s option.Years later, the Superior Court for the State of Alaska, Second Judicial District, Nome, dissolved the consent decree at the acquiring company’s request. The company then notified Delta Western that it considered the fuel storage contract terminated as a result. Delta Western filed a breach of contract action in Anchorage Superior Court, seeking to enforce the contract and arguing that its terms were independent of the consent decree. The contract case was transferred to Nome Superior Court, which issued a preliminary ruling that the contract remained valid despite the dissolution of the consent decree. The court also vacated its initial order dissolving the consent decree to allow Delta Western to intervene and present its position.The Supreme Court of the State of Alaska reviewed whether dissolution of the consent decree automatically terminated the fuel storage contract and whether the superior court abused its discretion by permitting Delta Western to intervene. The court held that dissolution of the consent decree did not automatically void the contract between the parties, and that the superior court did not abuse its discretion in allowing Delta Western to intervene. The Supreme Court affirmed the superior court’s decisions and lifted the stay on the contract case. View "Crowley Marine Services, Inc. v. State of Alaska" on Justia Law

Diego Pavia, a college football player, sought to play for Vanderbilt University during the 2025 season. After a successful 2024 season, Pavia faced ineligibility under National Collegiate Athletic Association (NCAA) rules, which limit athletes to four seasons of intercollegiate competition, including seasons played at junior colleges. Pavia’s path included time at a junior college, New Mexico State University, and Vanderbilt. The NCAA counted his 2021 junior college season toward his eligibility, effectively barring him from playing in 2025. Pavia argued that this rule violated the Sherman Act and sought injunctive relief to allow him to play in the 2025 and 2026 seasons.The United States District Court for the Middle District of Tennessee granted Pavia a preliminary injunction, preventing the NCAA from enforcing the rule against him for the 2025 season and from applying its restitution rule to Vanderbilt or Pavia based on his participation. The NCAA appealed this decision to the United States Court of Appeals for the Sixth Circuit.While the appeal was pending, the NCAA issued a waiver allowing all similarly situated athletes, including Pavia, to play in the 2025 season. The NCAA confirmed that this waiver would remain in effect regardless of the outcome of the appeal. The United States Court of Appeals for the Sixth Circuit determined that, because Pavia had already received the relief he sought at the preliminary injunction stage, the appeal was moot. The court held that it could not grant any further effectual relief and dismissed the appeal for lack of jurisdiction. The court also declined to vacate the preliminary injunction, finding that the NCAA’s own actions had caused the case to become moot. View "Pavia v. NCAA" on Justia Law

Several plaintiffs, including an individual, an investment fund, and a limited partnership, engaged in trading derivatives tied to the Sterling London Interbank Offered Rate (Sterling LIBOR). They alleged that a group of major banks conspired to manipulate Sterling LIBOR for their own trading advantage. The plaintiffs claimed that the banks coordinated false submissions to the rate-setting process, sometimes inflating and sometimes deflating the benchmark, which in turn affected the value of Sterling LIBOR-based derivatives. The plaintiffs asserted that this manipulation was orchestrated through internal and external communications among banks and with the help of inter-dealer brokers.The United States District Court for the Southern District of New York reviewed the case and dismissed the plaintiffs’ claims under the Sherman Act and the Commodity Exchange Act (CEA). The district court found that two plaintiffs lacked antitrust standing because they were not “efficient enforcers” and had not transacted directly with the defendants, resulting in only indirect and remote damages. The court also determined that the third plaintiff, a limited partnership, lacked the capacity to sue and had not properly assigned its claims to a substitute entity. Additionally, the court found that one plaintiff failed to adequately plead specific intent for the CEA claims.On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court’s dismissal, but on a narrower ground. The Second Circuit held that none of the plaintiffs plausibly alleged actual injury under either the Sherman Act or the CEA. The court explained that because the alleged manipulation was multidirectional—sometimes raising and sometimes lowering Sterling LIBOR—the plaintiffs did not show that they suffered net harm as a result of the defendants’ conduct. Without specific allegations of transactions where they were harmed by the manipulation, the plaintiffs’ claims could not proceed. The judgment of dismissal was affirmed, and the cross-appeal was dismissed as moot. View "Sonterra Cap. Master Fund, Ltd. v. UBS AG" on Justia Law

A group of plaintiffs, including an individual, a retirement fund, and several investment funds, traded derivatives based on the Euro Interbank Offered Rate (Euribor). They alleged that a group of banks and brokers conspired to manipulate Euribor, which affected the pricing of various over-the-counter (OTC) derivatives, such as FX forwards, interest-rate swaps, and forward rate agreements. The alleged conduct included coordinated false submissions to set Euribor at artificial levels, collusion among banks and brokers, and structural changes within banks to facilitate manipulation. Plaintiffs claimed this manipulation harmed them by distorting the prices of their Euribor-based derivative transactions.The United States District Court for the Southern District of New York dismissed the plaintiffs’ claims under the Sherman Act, the Commodity Exchange Act (CEA), the Racketeer Influenced and Corrupt Organizations Act (RICO), and state common law, finding it lacked personal jurisdiction over all defendants. The district court also found that the RICO claims were based on extraterritorial conduct and did not meet the particularity requirements of Federal Rule of Civil Procedure 9(b). It declined to exercise pendent personal jurisdiction over state-law claims.The United States Court of Appeals for the Second Circuit reviewed the case. It agreed that conspiracy-based personal jurisdiction was not established but held that two plaintiffs—Frontpoint Australian Opportunities Trust and the California State Teachers’ Retirement System—had established specific personal jurisdiction over UBS AG and The Royal Bank of Scotland PLC for Sherman Act and RICO claims related to OTC Euribor derivative transactions in the United States. The court affirmed dismissal of the RICO claims for lack of particularity, but held that the Sherman Act claims were sufficiently pleaded. It vacated the district court’s refusal to exercise pendent personal jurisdiction over state-law claims and remanded for further proceedings. The judgment was affirmed in part, reversed in part, and vacated in part. View "Sullivan v. UBS AG" on Justia Law

Two individuals, along with other plaintiffs, filed suit under Section 7 of the Clayton Act to block a proposed merger between two airlines. After their case was filed, the U.S. Department of Justice, joined by several states and the District of Columbia, brought a separate action challenging the same merger. Both cases were assigned to the same judge in the U.S. District Court for the District of Massachusetts, but were not consolidated. The district court found that only two of the original plaintiffs had standing, dismissing the others. The plaintiffs’ request to consolidate their case with the DOJ’s was denied.The DOJ case proceeded to trial first, resulting in a bench trial judgment that the merger violated the Clayton Act, and the court permanently enjoined the merger. The airlines appealed but later abandoned the merger and dismissed their appeal. As a result, the district court dismissed the remaining plaintiffs’ case as moot, since the relief they sought had already been granted in the DOJ case. The dismissed plaintiffs then moved for attorneys’ fees and costs, arguing they were prevailing parties under Section 16 of the Clayton Act because their efforts contributed to the outcome.The United States Court of Appeals for the First Circuit reviewed whether the plaintiffs qualified as prevailing parties eligible for attorneys’ fees. The court held that, under the standard set by Buckhannon Board & Care Home, Inc. v. West Virginia Department of Health & Human Resources, a party must obtain a judicially sanctioned change in the legal relationship of the parties, such as a judgment on the merits or a consent decree. Because the plaintiffs’ case was dismissed as moot without a judgment on the merits, and they were not beneficiaries of the injunction in the DOJ case, the court concluded they were not prevailing parties. The First Circuit affirmed the district court’s denial of attorneys’ fees and costs. View "Garavanian v. JetBlue Airways Corp." on Justia Law

Fifteen individuals who purchased new motorcycles from a major American manufacturer received a limited warranty with their purchases. The warranty provided for free repair or replacement of defective parts for up to 24 months but excluded coverage for defects or damage caused by non-approved or non-manufacturer parts. The plaintiffs, concerned that using non-manufacturer parts would void their warranties, opted to buy higher-priced parts from the manufacturer. They later alleged that the company’s warranty practices unlawfully conditioned warranty coverage on the exclusive use of its own parts, in violation of the Magnuson-Moss Warranty Act and various state antitrust laws.The United States Judicial Panel on Multidistrict Litigation consolidated the plaintiffs’ lawsuits and transferred them to the United States District Court for the Eastern District of Wisconsin. The district court dismissed the consolidated complaint for failure to state a claim. It found that the limited warranty did not condition benefits on exclusive use of manufacturer parts and that the risk of losing warranty coverage was insufficient to establish an anticompetitive tying arrangement or economic coercion under state antitrust law. The court also dismissed related state law claims premised on the same conduct.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court’s dismissal. The Seventh Circuit held that the warranty’s terms did not create an express or implied tie prohibited by the Magnuson-Moss Warranty Act, nor did the complaint plausibly allege violations of the Act’s disclosure or pre-sale availability requirements. The court further held that the plaintiffs failed to plausibly allege sufficient market power or anticompetitive effects to support their state antitrust claims, and that the warranty’s terms were available to consumers at the time of purchase, precluding a Kodak-style lock-in theory. The court affirmed dismissal of all claims. View "Heymer v. Harley-Davidson Motor Company Group, LLC" on Justia Law

Two individuals who frequently rented hotel rooms on the Las Vegas Strip brought a class action lawsuit, alleging that several major hotel operators and related entities caused them to pay artificially high prices for hotel rooms. The plaintiffs claimed that these hotels each entered into agreements to license revenue-management software from a single provider, Cendyn, whose products generated pricing recommendations based on proprietary algorithms. The software did not require hotels to follow its recommendations, nor did it share confidential information among the hotels. Plaintiffs alleged that, after the hotels adopted this software, room prices increased.The United States District Court for the District of Nevada reviewed the complaint, which asserted two claims under Section 1 of the Sherman Act. The first claim alleged a “hub-and-spoke” conspiracy among the hotels to adopt and follow the software’s pricing recommendations, but the district court dismissed this claim for failure to plausibly allege an agreement among the hotels. The plaintiffs later abandoned their appeal of this claim. The second claim alleged that the aggregate effect of the individual licensing agreements between each hotel and Cendyn resulted in anticompetitive effects, specifically higher prices. The district court dismissed this claim as well, finding that the plaintiffs failed to allege a restraint of trade in the relevant market.The United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal. The Ninth Circuit held that the plaintiffs failed to state a claim under Section 1 of the Sherman Act because the independent decisions by competing hotels to license the same pricing software, without an agreement among them or a restraint imposed by the software provider, did not constitute a restraint of trade. The court concluded that neither the terms nor the operation of the licensing agreements imposed anticompetitive restraints in the market for hotel-room rentals on the Las Vegas Strip. View "Gibson v. Cendyn Group, LLC" on Justia Law

A trading company and a base oil manufacturer entered into a sales agreement in 2016, under which the manufacturer would serve as the exclusive North American sales representative for a high-quality base oil product distributed by the trading company. The agreement included noncompete provisions and was set to expire at the end of 2021. In late 2020, suspicions arose between the parties regarding potential breaches of the agreement, leading to a series of letters in which the trading company accused the manufacturer of selling a competing product and threatened termination if the alleged breach was not cured. The manufacturer responded by denying any breach and, after further correspondence, declared the agreement terminated. The trading company agreed that the agreement was terminated, and both parties ceased their business relationship.The trading company then filed suit in the United States District Court for the Southern District of Texas, alleging antitrust violations, breach of contract, business disparagement, and misappropriation of trade secrets. The manufacturer counterclaimed for breach of contract and tortious interference. After a bench trial, the district court found in favor of the manufacturer on the breach of contract and trade secret claims, awarding over $1.3 million in damages. However, the court determined that the agreement was mutually terminated, not due to anticipatory repudiation by the trading company, and denied the manufacturer’s request for attorneys’ fees and prevailing party costs.On appeal, the United States Court of Appeals for the Fifth Circuit affirmed the district court’s finding that the trading company did not commit anticipatory repudiation and that the agreement was mutually terminated. The Fifth Circuit also affirmed the denial of prevailing party costs under Rule 54(d) of the Federal Rules of Civil Procedure. However, the appellate court vacated the denial of attorneys’ fees under the agreement’s fee-shifting provision and remanded for further proceedings on that issue. View "Penthol v. Vertex Energy" on Justia Law