Justia Antitrust & Trade Regulation Opinion Summaries
Sharif Pharmacy Inc. v. Prime Therapeutics LLC
The plaintiffs (Sharif Pharmacy, J&S) were members of the Prime pharmacy network, which is owned, in part, by Blue Cross Blue Shield. Under Medicare, Medicaid, and private health insurance plans, many patients had significant financial incentives to buy their prescription drugs from pharmacies within the network. Prime terminated both plaintiffs from the network after audits uncovered invoicing irregularities. The plaintiffs claimed that their terminations from the Prime network violated the Sherman Act, 15 U.S.C. 1 and 2. Three customers joined the suit, having had to switch to different, less convenient pharmacies. The plaintiffs alleged that the audits were pretextual and that Prime really terminated their participation in its network to get rid of competition with Walgreens, with whom it had entered a joint venture. Prime sent letters to both pharmacies’ customers saying that Sharif and J&S would no longer accept their insurance and recommending that customers have their prescriptions filled at a nearby Walgreens. Prime also retained funds from both pharmacies as a result of the audits. The Seventh Circuit affirmed the dismissals of the cases by two district courts. The individual plaintiffs lacked standing. The pharmacy could not identify an appropriate geographic market where a defendant had or threatened to have monopoly power. View "Sharif Pharmacy Inc. v. Prime Therapeutics LLC" on Justia Law
Viamedia, Inc. v. Comcast Corp.
Viamedia sued Comcast under the Sherman Act, 15 U.S.C. 2, for using its monopoly power in one service market (Interconnect) to exclude competition and gain monopoly power in another service market (advertising representation) in the Chicago, Detroit, and Hartford geographic markets. Interconnect services are cooperative selling arrangements for advertising through an “Interconnect” that enables retail cable television service providers to sell advertising targeted efficiently at regional audiences. Advertising representation services assist those providers with the sale and delivery of national, regional, and local advertising slots. Viamedia’s evidence indicated Comcast used its monopoly power over the Interconnect to force its smaller retail cable television competitors to stop doing business with Viamedia; Viamedia’s customers for advertising representation (Comcast’s retail cable competitors) switched to Comcast because Comcast presented a choice: either start buying advertising representation services from us and regain access to the Interconnect or keep buying services from Viamedia and stay cut off from the Interconnect they needed to compete effectively. The strategy cost Comcast millions of dollars in the short run but eventually gave it monopoly power in these local markets for advertising representation services. The Seventh Circuit reversed the dismissal of Viamedia’s case. Giving Viamedia the benefit of its allegations and evidence, this is not a case in which Section 2 is being misused to protect weaker competitors rather than competition more generally. Viamedia has also adequately stated a claim that Comcast has unlawfully refused to deal with Viamedia and any cable competitor that bought advertising representation from Viamedia. View "Viamedia, Inc. v. Comcast Corp." on Justia Law
Walgreen Co. v. Johnson & Johnson
Walgreen sells Remicade, a drug used to treat autoimmune diseases that is marketed and manufactured by Janssen. Walgreen procures Remicade from the Wholesaler, which acquires Remicade pursuant to a Distribution Agreement with JOM, a Janssen affiliate. Only Wholesaler and JOM are identified as parties to the Distribution Agreement. New Jersey law governs the Distribution Agreement, which contains an Anti-Assignment Provision, stating that “neither party may assign, directly or indirectly, this agreement or any of its rights or obligations under this agreement … without the prior written consent of the other party.” In 2018, Wholesaler assigned to Walgreen “all of its rights, title and interest in and to” its claims against Janssen “under the antitrust laws of the United States or of any State arising out of or relating to [Wholesaler]’s purchase of Remicade[.]” Walgreen filed suit against Janssen, asserting various federal antitrust claims relating to Remicade, citing exclusive contracts and anticompetitive bundling agreements with health insurers that suppressed generic competition to Remicade, which allowed Janssen to sell Remicade at supra-competitive prices. If the Anti-Assignment Provision prevented the assignment, then, under Supreme Court precedent, Walgreen, an “indirect” Remicade purchaser, would lack antitrust standing to assert claims against Janssen. The district court granted Janssen summary judgment. The Third Circuit reversed. The antitrust claims are a product of federal statute and thus are extrinsic to, and not rights “under,” a commercial agreement. View "Walgreen Co. v. Johnson & Johnson" on Justia Law
Wanke, Industrial, Commercial, etc. v. AV Builder Corp.
Wanke, Industrial, Commercial, Residential, Inc. (Wanke) was a company that installed waterproofing systems. It sued Scott Keck and another of its former employees in 2008 for trade secret misappropriation after they left Wanke to form a competing business, WP Solutions. The parties entered into a stipulated settlement and later litigated Keck's alleged breach of that settlement agreement. To collect, Wanke filed a creditor's suit against third party AV Builder Corp. (AVB) to recover $109,327 that AVB owed WP Solutions in relation to five construction subcontracts. Following a bench trial, the court entered judgment in Wanke's favor for $83,418.94 after largely rejecting AVB's setoff claims. Invoking assignment principles, AVB contended: (1) Wanke lacked the ability to sue given judgment debtor WP Solutions's corporate suspension; (2) Wanke's suit was untimely under section 708.230 of the Code of Civil Procedure; and (3) the trial court erred in denying its request for warranty setoffs under section 431.70. Rejecting each of these contentions, the Court of Appeal affirmed the judgment View "Wanke, Industrial, Commercial, etc. v. AV Builder Corp." on Justia Law
San Francisco Print Media Co. v. The Hearst Corp.
The San Francisco Examiner sued the San Francisco Chronicle, claiming that the defendant sold a certain type of print advertising in the Chronicle at prices that violated California’s Unfair Practices Act (UPA, Bus. & Prof. Code, 17000) and Unfair Competition Law (UCL, 17200). The trial court granted the defendant summary judgment. The court of appeal affirmed. The trial court properly rejected the claim of below-cost sales under the UPA after excluding the opinion of the plaintiff’s expert on costs. The plaintiff had disclaimed reliance on specific transactions to prove the Chronicle’s alleged underpricing of its print advertising, leaving only the aggregate cost analysis prepared by that expert to establish the occurrence of alleged below-cost sales. The plaintiff’s expert lacked the foundational knowledge to conduct the requisite cost analysis and based his analysis on another individual’s non-UPA-related pricing analysis without understanding its foundations, such as some of the included cost components. Summary judgment was proper as to the claim for unlawful use or sale of loss leaders under the UPA because the plaintiff failed to identify the loss leader sales on which this claim was based. The trial court did not err in granting summary judgment on the causes of action for secret and unearned discounts under the UPA. View "San Francisco Print Media Co. v. The Hearst Corp." on Justia Law
Institute For Responsible Alcohol Policy v. Oklahoma ex rel. Alcohol Beverage Laws Enforcement Comm.
Oklahoma Senate Bill 608 mandated that manufacturers of the top 25 brands of liquor and wine sell their product to all licensed wholesalers. Appellees, a group of liquor and wine wholesalers, manufacturers, retail liquor stores, and consumers, challenged Senate Bill 608 as unconstitutional, contending it was in conflict with Okla. Const. art. 28A, section 2(A)(2)'s discretion given to a liquor or wine manufacturer to determine what wholesaler sells its product. The district court agreed and ruled Senate Bill 608 unconstitutional. The Oklahoma Supreme Court held SB 608 was "clearly, palpably, and plainly inconsistent" with Article 28A, section 2(A)(2)'s discretion given to a liquor or wine manufacturer to determine what wholesaler sells its product. Furthermore, the Court ruled that SB 608 was not a proper use of legislative authority as Article 28A, section 2(A)(2) was not in conflict with the Oklahoma Constitution's anticompetitive provisions. The district court, therefore, did not err by granting Distributors' Motion for Summary Judgment and ruling SB 608 unconstitutional. View "Institute For Responsible Alcohol Policy v. Oklahoma ex rel. Alcohol Beverage Laws Enforcement Comm." on Justia Law
Saginaw County. v. STAT Emergency Medical Services, Inc.
Saginaw County has nearly 200,000 residents. A single company, Mobile Medical, has provided the county’s ambulance services since 2009. The county guaranteed Mobile the exclusive right to operate within its borders; Mobile pledged to serve all eight of Saginaw County’s cities and incorporated villages and its 27 rural townships. In 2011, STAT, a competing ambulance company, entered the Saginaw market, providing patient-transport services for an insurer as part of a contract that covered six Michigan counties. A municipality, dissatisfied with Mobile’s response times and fees, hired STAT. When Saginaw County proposed to extend Mobilel’s contract in 2013, STAT objected, arguing that the arrangement violated state law, federal antitrust law, and the Fourteenth Amendment. The county approved Mobile's new contract and enacted an ordinance that codified the exclusivity arrangement but never enforced the ordinance. STAT continued to insist that Michigan law permitted it to offer ambulance services. Saginaw County sought a federal declaratory judgment that Michigan law authorizes the exclusive contract and that it does not violate federal antitrust laws or the U.S. Constitution by prohibiting STAT from operating in the county. The Sixth Circuit affirmed the dismissal of the claim for lack of jurisdiction. The county failed to establish an actual or imminent injury. Federal courts have the power to tell parties what the law is, not what it might be in potential enforcement actions. View "Saginaw County. v. STAT Emergency Medical Services, Inc." on Justia Law
Hinrichs v. DOW Chemical Co.
The Supreme Court affirmed the decision of the court of appeals affirming the circuit court's dismissal of Chris Hinrichs and Autovation Limited's (collectively, Hinrichs) common law misrepresentation claims against the DOW Chemical Company and reversing the circuit court's dismissal of Hinrichs' statutory claim under Wis. Stat. 100.18, holding that the court of appeals did not err. Specifically, the Supreme Court held that, with regard to Hinrichs' common law claims, neither the "fraud in the inducement" exception nor the "other property exception" to the economic loss doctrine applied to allow Hinrichs' common law claims to go forward. With regard to Hinrichs' statutory claims the Court held (1) the economic loss doctrine does not serve as a bar to claims made under section 100.18; (2) because one person can be "the public" for purposes of section 100.18(1), the court of appeals did not err in determining that dismissal for failure to meet "the public" factor of the section 100.18 claim was in error; and (3) the heightened pleading standard for claims of fraud does not apply to claims made under section 100.18 and that Hinrichs' complaint stated a claim under the general pleading standard. View "Hinrichs v. DOW Chemical Co." on Justia Law
GandyDancer, LLC v. Rock House CGM, LLC
GandyDancer, LLC, and Rock House CGM, LLC, were business competitors, and both provided railway construction and repair services to BNSF Railway Company. BNSF awarded contracts to Rock House to provide goods and services in New Mexico. GandyDancer filed a complaint with the New Mexico Construction Industries Division (CID) in 2015 that alleged Rock House violated the Construction Industries Licensing Act (CILA), by performing unlicensed construction work in New Mexico. GandyDancer thereafter filed a complaint in district court against Rock House, alleging theories of competitive injury, and including a claim that Rock House engaged in unfair methods of competition to obtain contracts with BNSF contrary to the UPA. GandyDancer alleged Rock House’s acts amounted to an “unfair or deceptive trade practice” under Section 57-12-2(D) of the New Mexico Unfair Practices Act (UPA). The district court certified for interlocutory review whether the UPA supported supports a cause of action for competitive injury. The Court of Appeals accepted interlocutory review and held that a business may sue for competitive injury based on a plain reading of the UPA. The New Mexico Supreme Court reversed, because the Legislature excluded competitive injury from the causes of action permitted under that statute. Furthermore, the Court observed that Gandydancer relied upon dicta in Page & Wirtz Construction Co. v. Soloman, 794 P.2d 349. Therefore, the Court formally disavowed reliance on Page & Wirtz or prior New Mexico case law that conflicted with its opinion here. View "GandyDancer, LLC v. Rock House CGM, LLC" on Justia Law
Parnell v. Fanduel, Inc.
The Supreme Court affirmed the judgment of the circuit court dismissing Appellant's complaint and class action allegations against FanDuel, Inc., holding that Appellant's complaint was devoid of facts upon which he may be entitled to relief. Plaintiff filed this class action lawsuit alleging that FanDuel ran illegal advertising. Plaintiff alleged violations of the Arkansas Deceptive Trade Practices Act (ADTPA) and unjust enrichment on behalf of himself and the putative class. The circuit court dismissed both Plaintiff's complaint and the class allegations, concluding that the complaint failed to allege an actual loss and that the class allegations could no longer be maintained under the amended ADTPA. The Supreme Court affirmed, holding that Plaintiff's action was not cognizable under the ADTPA and that his unjust enrichment claim failed because Plaintiff did not actually allege that FanDuel was unjustly enriched. View "Parnell v. Fanduel, Inc." on Justia Law