Justia Antitrust & Trade Regulation Opinion Summaries

Defendant Native Wholesale Supply Company (NWS), an Indian-chartered corporation headquartered on a reservation in New York, sold over a billion contraband cigarettes to an Indian tribe in California, which then sold the cigarettes to the general public in California. The cigarettes were imported from Canada, stored at various places in the United States (not including California), and then shipped to California after they were ordered from the reservation in New York. The California Attorney General succeeded on his motion for summary judgment holding NWS liable for civil penalties in violation of two California cigarette distribution and sale laws and Business and Professions Code section 17200 (the unfair competition law), and obtained a permanent injunction precluding NWS from making future sales. The Attorney General further obtained an award of attorney fees and expert expenses. NWS appealed the judgment and the attorney fee order. Finding no reversible error, the Court of Appeal affirmed. View "California v. Native Wholesale Supply Co." on Justia Law

The Ninth Circuit affirmed the district court's order entering a preliminary injunction freezing all of defendants' assets in connection with Consumer Defense Global's loan modification business operations. The Commission filed suit alleging that defendants violated the Federal Trade Commission Act and Regulation O, 12 C.F.R. Part 1015 – Mortgage Assistance Relief Services. In this case, the parties agree that the FTC brought the instant action pursuant to the second proviso of Section 13(b) of the FTC Act, but dispute whether the FTC was required to demonstrate a likelihood of irreparable harm to obtain relief.The panel held that, although in the ordinary case a showing of irreparable harm is required to obtain injunctive relief, no such showing is required when injunctive relief is sought in conjunction with a statutory enforcement action where the applicable statute authorizes injunctive relief. Therefore, the panel held that the district court did not err by granting the motion for preliminary injunction without requiring the FTC to make the traditional showing of irreparable injury. View "FTC v. Consumer Defense, LLC" on Justia Law

In this case concerning civil liability based on insurer conduct affecting chiropractic services, the Supreme Court affirmed the order of the trial court dismissing all claims in this case, relying on and incorporating its reasoning in a companion case, Sykes v. Health Network Solutions, Inc., __ S.E.2d __ (N.C. 2019)(Sykes I), in holding that the decision in Sykes I met the criteria for collateral estoppel.This case was one of two putative class actions alleging that defendant insurers contracted with Health Network Solutions, Inc. (HNS) to provide or restrict insured chiropractic services in violation of state insurance and antitrust laws. Plaintiffs chose to bring this action against insurers separately from their claims against against HNS and its individual owners in Sykes I, but both actions presented essentially the same claims and relied on the same theories. The trial court dismissed Plaintiffs' claims in this case. The Supreme Court affirmed, holding that collateral estoppel barred Plaintiffs from litigating these matters given the Court's resolution of the issues in Sykes I. View "Sykes v. Blue Cross & Blue Shield of North Carolina" on Justia Law

The Supreme Court affirmed the Business Court's dismissal of Plaintiffs' claims against Defendants Health Network Solutions, Inc. (HNS) and HNS's individual owners alleging that HNS committed antitrust and other violations in its role as intermediary between individual chiropractors and several insurance companies and third-party administrators, holding that the Business Court did not err in dismissing Plaintiffs' entire complaint.Plaintiffs were licensed chiropractic providers in North Carolina who alleged that Defendants engaged in unlawful price fixing resulting in a reduction of output of chiropractic services in North Carolina. The Business Court granted in part and denied in part Defendants' motions to dismiss and for partial summary judgment and then dismissed Plaintiffs' remaining claims under N.C. R. Civ. P. 12(b)(6). The Supreme Court affirmed, holding that the Business Court did not err in dismissing each of Plaintiffs' substantive claims and their derivative claims. The Business Court's dismissal of Plaintiffs' antitrust claims, including the derivative claim of civil conspiracy, stands without presidential value because the members of the Court were equally divided as to these claims. View "Sykes v. Health Network Solutions, Inc." on Justia Law

The FTC and the State of North Dakota moved to enjoin Sanford Bismarck's acquisition of Mid Dakota, alleging that the merger violated section 7 of the Clayton Act. The district court determined that plaintiffs would likely succeed in showing the acquisition would substantially lessen competition in four types of physician services in the Bismarck-Mandan area.The Eighth Circuit affirmed the district court's grant of a preliminary injunction, holding that the district court did not improperly shift the ultimate burden of persuasion to defendants and properly followed the analytical framework in U.S. v. Baker Hughes, Inc., 908 F.ed 981 (D.C. Cir. 1990); the district court did not clearly err in defining the relevant market; and the district court's finding on merger-specific efficiencies was not clear error. View "Federal Trade Commission v. Sanford Health" on Justia Law

Apple sells iPhone applications (apps) directly to iPhone owners through its App Store—the only place where iPhone owners may lawfully buy apps. Most apps are created by independent developers under contracts with Apple. Apple charges the developers a $99 annual membership fee, allows them to set the retail price of the apps, and charges a 30% commission on every app sale. Four iPhone owners sued, alleging that Apple has unlawfully monopolized the aftermarket for iPhone apps. The Ninth Circuit reversed the dismissal of the suit concluding that the owners were direct purchasers under the Supreme Court’s “Illinois Brick” precedent.The Supreme Court affirmed. The Clayton Act provides that “any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue,” 15 U.S.C. 15(a), and readily covers consumers who purchase goods or services at higher-than-competitive prices from an allegedly monopolistic retailer. While indirect purchasers who are two or more steps removed from the violator in a distribution chain may not sue, the iPhone owners are not consumers at the bottom of a vertical distribution chain who are attempting to sue manufacturers at the top of the chain. The absence of an intermediary in the distribution chain between Apple and the consumer is dispositive. The Court rejected an argument that Illinois Brick allows consumers to sue only the party who sets the retail price. Apple’s interpretation would contradict the long-standing goal of effective private enforcement and consumer protection in antitrust cases. Illinois Brick is not a get-out-of-court-free card for monopolistic retailers any time that a damages calculation might be complicated. View "Apple, Inc. v. Pepper" on Justia Law

The Court of Chancery granted in part Defendant's motion to dismiss as to the count alleging a violation of the federal Computer Fraud and Abuse Act (CFAA) but denied Defendant's motion as to the remainder of the non-contractual claims against him, holding that Plaintiff's CFAA claim was legally viable only as to Defendant's post-resignation conduct and that the dismissal of Plaintiffs' other claims was inappropriate.Defendant was the managing partner of Plaintiffs' Paris office and was a party to a limited liability partnership agreement that contained confidentiality obligations. Shortly before his resignation and then shortly after his resignation, Defendant accessed Plaintiffs' business files. Plaintiffs later sued for breach of the confidentiality provisions of the limited liability partnership agreement, asserting violations of the Delaware Uniform Trade Secrets Act (DUTSA), for common law conversion, and for violating CFAA. Defendant filed a motion to dismiss. The Court of Chancery granted the motion in part as to the CFAA claims but denied it as to the remaining claims, holding that under the narrow approach set forth in LVRC Holdings LLC v. Brekka, 581 F.3d 1127 (9th Cir. 2009), Defendant's actions while he was employed by Plaintiffs did not support a claim under the CFAA. View "AlixPartners, LLP v. Benichou" on Justia Law

IQ filed suit against three large dental supply distributors, alleging that defendants violated federal and state antitrust laws, as well as common law tort claims. The Second Circuit affirmed the district court's dismissal of IQ's claim that it has antitrust standing to challenge the boycott of SourceOne and the state dental associations (SDAs) that had partnered with SourceOne. However, the court found that IQ's antitrust and tort claims may go forward on the direct boycott allegations. In this case, IQ was an efficient enforcer of the antitrust laws solely with respect to its allegations that it has been directly boycotted by the actions of defendants. Accordingly, the court vacated in part and remanded for further proceedings. Finally, IQ's state law antitrust claims and common law tort claims were also vacated and remanded, but only to the extent that they relied on IQ's allegations that it suffered harm as a result of the direct boycott. View "IQ Dental Supply, Inc. v. Henry Schein, Inc." on Justia Law

MCEP, an acute care, for-profit hospital owned by 60 physicians and one corporate shareholder, opened in 2006. By 2009, MCEP’s existence as a physician-owned enterprise ended when it sold an ownership interest to Kettering Health Network, a competitor in the Dayton healthcare market. MCEP alleges that it failed because of the anticompetitive actions of Premier, a dominant healthcare network in the Dayton area. MCEP alleges that Premier contracted with area physicians and payers (insurers and managed-care plan providers) on the condition that they did not do business with MCEP. MCEP claims that Premier engaged in a conspiracy so devoid of benefit to the market as to be per se illegal under the Sherman Act, 15 U.S.C. 1. The Sixth Circuit affirmed summary judgment in favor of the defendants. To be per se illegal, a defendant’s conduct has to be so obviously anticompetitive that it has no plausibly procompetitive features. Premier’s contracts with payers and physicians had plausibly procompetitive features. It is plausible that panel limitations, which prohibited referrals to MCEP, lower the cost of defendants’ services and improve “cost effectiveness and efficiencies in the delivery of health care services.” View "Medical Center at Elizabeth Place, LLC v. Atrium Health System" on Justia Law

The Second Circuit affirmed the district court's dismissal of LBE's action alleging claims under the Sherman Act and the Racketeer Influenced and Corrupt Organizations Act (RICO). LBE alleged that Barbri and law schools entered into agreements whereby Barbri donates money to the schools, bribes their administrators, and hires their faculty to teach bar review courses. LBE further alleged that, in exchange, the law school gives Barbri direct access to promote and sell its products on campus.The court adopted the district court's well-reasoned and thorough analysis of LBE's allegations and held that the district court properly dismissed the complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a plausible claim of relief. The district court concluded that internal contradictions and conclusory assertions in the complaint did not plausibly support LBE's claim that Barbri and the law schools conspired to enable Barbri to gain a monopoly. View "LLM Bar Exam, LLC v. Barbri, Inc." on Justia Law