Justia Antitrust & Trade Regulation Opinion Summaries
Ellison v. American Board of Orthopaedic Surgery
Ellison, an orthopedic surgeon who practices in California, wants to move to New Jersey and practice in the RWJBarnabas Health system. In order to obtain staff privileges, Ellis sought certification by the American Board of Orthopaedic Surgery (ABOS) around 2012. ABOS only certifies surgeons who successfully complete its multistep certification examination. Ellison passed the first step of ABOS’s exam, but ABOS prohibited him from taking the second step until he first obtained medical staff privileges at a hospital. Ellison has yet to apply for staff privileges. He believes the New Jersey hospitals where he desires to practice will reject his application, as their bylaws provide that they generally grant privileges only to physicians who are already board certified. Ellison sued ABOS in 2016. ABOS removed the matter to federal court. Ellison amended his complaint to allege that ABOS violated the Sherman Act, 15 U.S.C. 1. The District Court dismissed Ellison’s complaint for failure to state a claim for relief.The Third Circuit vacated with instructions to dismiss the case for lack of standing. Ellison has not attempted to apply for medical staff privileges or taken any concrete steps to practice in New Jersey. His assertions that ABOS has injured him are speculative. View "Ellison v. American Board of Orthopaedic Surgery" on Justia Law
United Food & Commercial Workers Local 1776 v. Takeda Pharmaceutical Co.
Defendants in these tandem cases (collectively, "Takeda") are a brand pharmaceutical manufacturer and related entities that began producing and marketing the Type-2 diabetes drug ACTOS in 1999. Purchasers of ACTOS filed suit against Takeda for improperly describing its patents to the FDA, in effect extending the duration of its patent protection over ACTOS and delaying generic competition. The district court denied Takeda's motion to dismiss, concluding that the alleged patent descriptions were incorrect under the Hatch–Waxman Act and pertinent regulations.On this interlocutory appeal, the Second Circuit held that under the "Listing Requirement" of 21 U.S.C. 355(b)(1), a combination patent does not "claim" any of its component drug substances past their individual patent expiration dates. The court also held that the purchasers were not required to allege that Takeda's interpretation of the Listing Requirement was unreasonable in order to plead a monopolization claim under the Sherman Act. Accordingly, the court affirmed the district court's denial of Takeda's motion to dismiss and remanded for further proceedings. View "United Food & Commercial Workers Local 1776 v. Takeda Pharmaceutical Co." on Justia Law
Hetronic International v. Hetronic Germany GmbH, et al.
Hetronic International, Inc., a U.S. company, manufactured radio remote controls, the kind used to remotely operate heavy-duty construction equipment. Defendants, none of whom were U.S. citizens, distributed Hetronic’s products, mostly in Europe. After about a ten-year relationship, one of Defendants’ employees stumbled across an old research-and-development agreement between the parties. Embracing a “creative legal interpretation” of the agreement endorsed by Defendants’ lawyers, Defendants concluded that they owned the rights to Hetronic’s trademarks and other intellectual property. Defendants then began manufacturing their own products—identical to Hetronic’s—and selling them under the Hetronic brand, mostly in Europe. Hetronic terminated the parties’ distribution agreements, but that didn’t stop Defendants from making tens of millions of dollars selling their copycat products. Hetronic asserted numerous claims against Defendants, but the issue presented on appeal to the Tenth Circuit centered on its trademark claims under the Lanham Act. A jury awarded Hetronic over $100 million in damages, most of which related to Defendants’ trademark infringement. Then on Hetronic’s motion, the district court entered a worldwide injunction barring Defendants from selling their infringing products. Defendants ignored the injunction. In the district court and before the Tenth Circuit, Defendants focused on one defense in particular: Though they accepted that the Lanham Act could sometimes apply extraterritorially, they insisted the Act’s reach didn’t extend to their conduct, which generally involved foreign defendants making sales to foreign consumers. Reviewing this matter as one of first impression in the Tenth Circuit, and after considering the Supreme Court’s lone decision on the issue and persuasive authority from other circuits, the Tenth Circuit concluded the district court properly applied the Lanham Act to Defendants’ conduct. But the Court narrowed the district court’s expansive injunction. Affirming in part, and reversing in part, the Court remanded the case for further consideration. View "Hetronic International v. Hetronic Germany GmbH, et al." on Justia Law
Aya Healthcare Services, Inc. v. AMN Healthcare, Inc.
In 2010, AMN Healthcare contracted with Aya Healthcare to provide travel nursing services to healthcare facilities. The contract prohibited Aya from soliciting AMN’s employees. In 2015, Aya began actively soliciting AMN’s travel nurse recruiters. AMN temporarily terminated Aya’s access to AMN’s platform. The parties ended their relationship. Aya filed suit under the Sherman Antitrust Act, 15 U.S.C. 1, 2, including a “per se” claim and a quick-look/rule-of-reason claim and claims for attempted monopolization and monopolization, and state law tortious interference and other claims. Aya claimed that it suffered exclusionary damages as a result of AMN’s non-solicitation covenant and retaliatory damages as a result of AMN’s termination of the relationship.The Ninth Circuit affirmed summary judgment in favor of AMN. The non-solicitation agreement is an ancillary, rather than a naked restraint, because it is reasonably necessary to the parties’ procompetitive collaboration; it is not per se unlawful but is subject to the rule-of-reason standard. Aya failed to satisfy its initial burden under that standard because it did not establish a triable issue of fact with respect to whether AMN’s nonsolicitation agreement has a substantial anticompetitive effect that harms consumers in the relevant market. Aya’s claim for retaliatory damages failed because it did not present any evidence of a cartel or a concerted action in the termination of the agreement. View "Aya Healthcare Services, Inc. v. AMN Healthcare, Inc." on Justia Law
Stone v. East Coast Swappers, LLC
The Supreme Court affirmed the judgment of the appellate court affirming the judgment of the trial court finding that Defendant, East Coast Swappers, LLC, had violated the Connecticut Unfair Trade Practices Act (CUTPA), Conn. Gen. Stat. 42-110a et seq., holding that the trial court abused its discretion when it failed to award Plaintiff attorney's fees.The trial court found that Defendant had violated CUTPA and awarded Plaintiff compensatory damages. The court, however, declined to award punitive damages or attorney's fees. On appeal, Plaintiff argued that the Court should adopt a presumption whereby a plaintiff prevailing in a CUTPA action should ordinarily recover attorney's fees under section 42-110g(d) unless the award would be unjust. The Supreme Court declined to adopt Plaintiff's suggested presumption but nevertheless reversed, holding that the trial court abused its discretion by failing to award Plaintiff attorney's fees. View "Stone v. East Coast Swappers, LLC" on Justia Law
Toddle Inn Franchising, LLC v. KPJ Associates LLC
The First Circuit affirmed the judgment of the district court judge confirming an arbitration award, holding that none of Appellant's legal theories for reversal were meritorious.KPJ Associates, LLC ran a daycare in Maine as a franchisee of Toddle Inn Franchising, LLC. When KPJ ended the franchise agreement on Friday and told Toddle it would open another daycare at the same site the following Monday Toddle filed a federal complaint alleging unfair competition under the federal Lanham Act and breach of contract and trade secret misappropriation under Maine law. Toddle then moved to compel arbitration and stay court proceedings. The judge compelled arbitration, and the arbitrator found for Toddle. The First Circuit affirmed, holding that the district court judge (1) did not lack subject matter in this case because Toddle did not present a frivolous Lanham Act claim; (2) did not err in ruling that Toddle did not waive its right to arbitrate by its litigation conduct; and (3) did not err in awarding additional attorneys' fees and costs. View "Toddle Inn Franchising, LLC v. KPJ Associates LLC" on Justia Law
St. Luke’s Hospital v. ProMedica Health System, Inc.
The Sixth Circuit previously affirmed the Federal Trade Commission’s decision to block a merger of ProMedica and St. Luke’s Hospital in Lucas County, Ohio. As part of the unwinding of the merger, ProMedica and St. Luke’s signed an agreement in which ProMedica’s insurance subsidiary, Paramount, agreed to maintain St. Luke’s as a within-network provider; Paramount could drop St. Luke’s if ownership of the hospital changed. A large healthcare company based in Michigan, McLaren, subsequently merged with St. Luke’s. Paramount ended its relationship with St. Luke’s, removing the hospital from its provider network. St. Luke’s then alleged that ProMedica’s refusal to do business with it violated the antitrust laws. The district court preliminarily enjoined ProMedica from ending the agreement. The Sixth Circuit vacated. Because ProMedica had a legitimate business explanation for ending the relationship, St. Luke’s is unlikely to show that ProMedica unlawfully refused to continue doing business with it. St. Luke’s has little likelihood of establishing an irreparable injury given the option of money damages. View "St. Luke's Hospital v. ProMedica Health System, Inc." on Justia Law
Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co. Ltd.
Plaintiffs, American purchasers of bulk Vitamin C, filed a class action alleging that four Chinese exporters of Vitamin C conspired to inflate prices and restrict supply in violation of the Sherman Act and the Clayton Act. The district court denied defendants' motion to dismiss on the basis of the act of state doctrine, foreign sovereign compulsion, and international comity. After the district court denied defendants' motion for summary judgment, the case proceeded to trial where all defendants settled except for Hebei and its parent company NCPG. Following the jury verdict, the district court entered treble damages against Hebei and NCPG and denied their renewed motion for judgment as a matter of law. The Second Circuit reversed. The Supreme Court then reversed the Second Circuit's judgment and remanded.On remand from the Supreme Court, the Second Circuit once again concluded that this case should be dismissed on international comity grounds. Giving careful consideration but not conclusive deference to the views of the Ministry of Commerce of the People's Republic of China, the court read the relevant Chinese regulations—as illuminated by contemporaneous administrative documents and industry reports—to have required defendants to collude on Vitamin C export prices and quantities as part and parcel of China's export regime for Vitamin C. The court balanced this true conflict between U.S. and Chinese law together with other established principles of international comity, declining to construe U.S. antitrust law to reach defendants' conduct. Accordingly, the court reversed and remanded with instructions to dismiss the case. View "Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co. Ltd." on Justia Law
Quadvest, LP v. San Jacinto River Authority
Plaintiffs Quadvest and Woodland Oaks filed suit against SJRA, a state entity, alleging that SJRA violated Section 1 of the Sherman Act when it entered into and enforced contracts relating to the purchase of wholesale water in Montgomery County, Texas. The district court denied SJRA's motion to dismiss.The Fifth Circuit affirmed, concluding that, for the purposes of the court's jurisdictional analysis, SJRA invokes state-action immunity as a state entity. Therefore, this interlocutory appeal is proper under the court's precedent. On the merits, the court concluded that the Texas Legislature did not authorize SJRA’s entry into and enforcement of the challenged groundwater reduction plan (GRP) contract provisions with the intent to displace competition in the market for wholesale raw water in Montgomery County. Therefore, SJRA is not entitled to state-action immunity at this stage in the proceedings. View "Quadvest, LP v. San Jacinto River Authority" on Justia Law
Always Towing & Recovery Inc. v. City of Milwaukee
Companies that tow or recycle used cars alleged that Milwaukee and its subcontractor, engaged in anticompetitive behavior to self-allocate towing services and abandoned vehicles, a primary input in the scrap metal recycling business. They alleged that an exclusive contract the city entered into with one of the area’s largest recycling providers, Miller Compressing, violated the Sherman Act, 15 U.S.C. 1, and that the contract provided direct evidence of an agreement to restrain trade. They cited laws that require a city-issued license to tow vehicles from certain areas, that obligate towing companies to provide various notices, and that cap maximum charges imposed on vehicle owners who have illegally parked or abandoned their vehicles, as having been enacted to squeeze them out of the market.The Seventh Circuit affirmed the dismissal of the suit. The arrangement between the city and Miller is not per se unreasonable on the basis of horizontal price-fixing. The court also rejected a claim of “bid-rigging.” View "Always Towing & Recovery Inc. v. City of Milwaukee" on Justia Law