Justia Antitrust & Trade Regulation Opinion Summaries

Magellan, a manufacturer of electronic nicotine delivery systems (“ENDS”) products, sought authorization from the FDA to market ENDS under the Family Smoking Prevention and Tobacco Control Act (the “TCA”). The FDA denied Magellan's application related to the company's flavored ENDS products, finding insufficient evidence showing that marketing the pods would be appropriate for the protection of public health, a finding that requires denial of an application under the TCA. Magellan petitioned for review, arguing the FDA action was arbitrary and capricious. Magellan also argues that the FDA exceeded its statutory authority by requiring applicants to demonstrate that their flavored ENDS products are more effective than tobacco-flavored products at promoting cessation or switching from combustible cigarettes to ENDS products.The Second Circuit affirmed. The FDA did not impose a new evidentiary standard on Magellan; therefore, the FDA did not need to provide notice or consider its reliance interests. Thus, the court concluded that the FDA did not act arbitrarily or capriciously. View "Magellan Technology, Inc. v. United States Food and Drug Administration" on Justia Law

Both Risk Based Security, Inc. (“RBS”) and Synopsys, Inc., identify vulnerabilities in the source code of software and share information about those vulnerabilities so they can be corrected before nefarious individuals exploit them. After RBS accused Synopsys of engaging in unlawful conduct related to the content of RBS’ vulnerability database, Synopsys filed this declaratory judgment action. In relevant part, Synopsys sought a judicial declaration that it had not misappropriated RBS’ trade secrets. On the merits, the district court granted Synopsys’ motion for summary judgment on that claim after concluding that RBS had not come forward with evidence showing that any of its alleged trade secrets satisfied the statutory definition of that term. RBS appealed by challenging the district court’s merits determination of trade secrets as well as its decisions denying RBS’ motion to dismiss the case as moot, excluding testimony from two of RBS’ expert witnesses, and denying its motion for partial summary judgment as to some of its trade secret claims.   The Fourth Circuit affirmed. The court explained that the district court properly concluded that RBS failed to put forward admissible evidence showing that the seventy-five alleged trade secrets had independent economic value. Absent proof sufficient to satisfy that part of the statutory definition of a “trade secret,” RBS could not prevail in a misappropriation-of-trade-secrets claim, and the district court properly granted summary judgment to Synopsys. Given this holding, the court wrote, it need not consider RBS’ additional argument that the district court erred in denying its motion for partial summary judgment. View "Synopsys, Inc. v. Risk Based Security, Inc." on Justia Law

Plaintiffs appealed from a final judgment entered in favor of Defendants The TriZetto Group, Inc. and Cognizant Technology Solutions Corporation (collectively, “TriZetto”) after a jury trial in district court. Relevant here, the district court ordered and entered judgment that (1) Syntel misappropriated 104 of TriZetto’s trade secrets in violation of the Defend Trade Secrets Act (“DTSA”) and New York law; and (2) TriZetto’s $284,855,192 compensatory damages award was proper under the DTSA. On appeal, Syntel challenges the district court’s judgment with respect to liability and damages.   The Second Circuit affirmed and vacated the judgment of the district court and remanded. The court held that the unambiguous terms of the Amended Master Services Agreement (MSA) are clear, and so is the extrinsic evidence: TriZetto did not authorize Syntel to use TriZetto’s trade secrets to compete with TriZetto. Thus, Syntel misappropriated TriZetto’s intellectual property in violation of the DTSA and New York law. Accordingly, the court affirmed the district court’s denial of Syntel’s Rule 50(b) motion on this issue. The court concluded that, as a matter of law, an unjust enrichment award of avoided costs was unavailable under the specific facts of this case. Syntel’s unjust gain was fully “addressed in computing damages for [TriZetto’s] actual loss,” and TriZetto suffered no compensable harm beyond that actual loss. Thus, the court remanded the case for the district court to address the propriety of the two jury awards based on TriZetto’s damages theory of awarding a reasonable royalty: (1) the $142,427,596 New York trade secret misappropriation award and (2) the $59,100,000 copyright infringement award. View "Syntel Sterling Best Shores Mauritius, Ltd., et al. v. The TriZetto Grp.," on Justia Law

This appeal concerns a trademark dispute between two credit unions: “Elevate Federal Credit Union” and “Elevations Credit Union.” Elevate sued for a declaratory judgment of noninfringement, and Elevations counterclaimed for trademark infringement under the Lanham Act. The parties proffered expert witnesses and challenged the admissibility of the adversary’s expert testimony. The district court excluded opinion testimony by Elevations’ expert witness and granted summary judgment to Elevate on its claim for a declaratory judgment and on Elevations’ counterclaim. Elevations appealed these rulings. The appeal presented two issues for the Tenth Circuit's resolution: (1) whether the district court acted within its discretion when disallowing Elevations' expert testimony because Elevations failed to disclose information that the expert witness considered; and (2) whether the marks belong to credit unions with differing eligibility restrictions in distinct geographic markets, could the presence of some similarities create a likelihood of confusion. The Tenth Circuit concluded the district court did not abuse its discretion in disallowing the expert testimony, and the differing eligibility restrictions in differing markets did not create a likelihood of confusion. View "Elevate Federal Credit Union v. Elevations Credit Union" on Justia Law

The Oregon Attorney General brought this action against defendants, Living Essentials, LLC and Innovation Ventures, LLC, alleging that they had made representations about their products that violated two different provisions of the Oregon Unlawful Trade Practices Act (UTPA). The trial court ruled for defendants, explaining that the relevant provisions of the UTPA required the State to prove that the misrepresentations were “material to consumer purchasing decisions,” and that the State had not done so. The Court of Appeals affirmed that decision. The Oregon Supreme Court granted the State’s petition for review to consider whether the lower courts correctly construed the statute. After such review, the Supreme Court concluded, contrary to the trial court and the Court of Appeals, that the UTPA provisions at issue contained no “material to consumer purchasing decisions” requirement. The Supreme Court also rejected defendants’ argument that, without such a requirement, the provisions facially violated the free speech provisions of the State and federal constitutions. Accordingly, the Supreme Court reversed the decision of the Court of Appeals and remanded to that court for further proceedings. View "State ex rel Rosenblum v. Living Essentials, LLC" on Justia Law

A putative class of over 12 million merchants brought this antitrust action under the Sherman Act against Visa U.S.A. Inc., MasterCard International Inc., and numerous banks that serve as payment-card issuers for those networks. Plaintiffs alleged that Visa and MasterCard adopted and enforced rules and practices relating to payment cards that had the combined effect of injuring merchants by allowing Visa and MasterCard to charge supracompetitive fees (known as “interchange fees”) on each payment card transaction. After nearly fifteen years of litigation, the parties agreed to a settlement of roughly $ 5.6 billion, which was approved by the district court over numerous objections. In so doing, $900,000 in service awards was granted to lead plaintiffs, and roughly $523 million was granted in attorneys’ fees. Appellants are various objectors who argue that the district court erred when it certified the class, approved the settlement, granted service awards and computed attorneys’ fees.   The Second Circuit affirmed in all respects the district court’s orders to the extent they constituted a final judgment, with the exception that the court directed the district court to reduce the service award to class representatives to the extent that its size was increased by time spent in lobbying efforts that would not increase the recovery of damages. The court made no ruling as to how damages should be allocated between branded oil companies and their branded service station franchisees, the reasonableness of the special master’s ultimate findings, or the legality of releasing an as-of-yet hypothetical future claim. View "In re Payment Card Interchange Fee and Merchant Discount Antitrust" on Justia Law

Relevent Sports, LLC, a U.S.-based soccer promoter, alleges that the Fédération Internationale de Football Association (popularly known as FIFA) and the United States Soccer Federation, Inc. adopted and enforced a geographic market division policy in 2018 that unlawfully prohibits soccer leagues and teams from playing official season games outside of their home territory. Relevent claims that the 2018 policy represents an agreement among direct competitors to restrict competition in violation of federal antitrust laws. The district court concluded that Relevent failed to allege that the challenged anticompetitive conduct stemmed from a prior agreement to enter into the 2018 policy.   The Second Circuit vacated and remanded. The court explained that a plaintiff challenging an association policy or rule that governs the conduct of the members’ separate businesses need not allege an antecedent “agreement to agree.” Because Relevent challenges the allegedly monopolistic 2018 Policy directly, it has adequately alleged concerted action. The Sherman Antitrust Act and the Clayton Antitrust Act require no further allegations of an agreement to engage in concerted action for Relevent’s complaint to survive a motion to dismiss. View "Relevent Sports v. U.S. Soccer Federation" on Justia Law

Plaintiffs are participants in the physical and derivatives markets for platinum and palladium and seek monetary and injunctive relief for violations of the antitrust laws and the Commodities Exchange Act (“CEA”). According to Plaintiffs, Defendants—mostly foreign companies engaged in trading these metals—manipulated the benchmark prices for platinum and palladium by collusively trading on the futures market to depress the price of these metals and by abusing the process for setting the benchmark prices. Defendants allegedly benefited from this conduct via trading in the physical markets and holding short positions in the futures market. The district court held that it had personal jurisdiction over two of the foreign Defendants, but it dismissed Plaintiffs’ antitrust claims for lack of antitrust standing and the Plaintiffs’ CEA claims for being impermissibly extraterritorial. Plaintiffs appealed the dismissal of these claims.   The Second Circuit reversed in part, vacated in part, and affirmed in part. The court reversed the district court’s holding that the “Exchange Plaintiffs” lacked antitrust standing to sue for the manipulation of the New York Mercantile Exchange futures market in platinum and palladium. The court explained that as traders in that market, the Exchange Plaintiffs are the most efficient enforcers of the antitrust laws for that injury. But the court affirmed the district court’s conclusion that KPFF Investment, Inc. did not have antitrust standing. Additionally, the court vacated the district court’s dismissal of Plaintiffs’ CEA claims. View "In re Platinum and Palladium Antitrust Litigation" on Justia Law

The Federal Trade Commission (the “Commission”) alleges that Defendant and his six companies engaged in unfair or deceptive business practices in violation of Section 5(a) of the Federal Trade Commission Act and the Telemarketing Sales Rule. Relying on its authority under Section 13(b) of the FTC Act, the Commission obtained a preliminary injunction that included an asset freeze and the imposition of a receiver. Defendant argued that the preliminary injunction must be dissolved because a recent Supreme Court decision undermines the Commission’s Section 13(b) authority.
The Eleventh Circuit affirmed the order denying Defendant’s emergency motion to dissolve the preliminary injunction. The court explained that Defendant urged the court to read AMG Capital as a signal to interpret the FTC Act with a view to “reigning in the FTC’s power.” But, the court wrote, that AMG Capital teaches the court to read the FTC Act to “mean what it says.” 141 S. Ct. at 1349. In AMG Capital, that meant limiting Section 13(b)’s provision for a “permanent injunction” to injunctive relief. Here, that means recognizing the broad scope of relief available under Section 19. When the Commission enforces a rule, Section 19 grants the district court jurisdiction to offer relief “necessary to redress injury to consumers.” To preserve funds for consumers, the Commission sought to freeze Defendant’s assets and impose a receivership over his companies. Section 19 allows such relief. View "Federal Trade Commission v. Steven J. Dorfman" on Justia Law

Plaintiff ACTGC brought federal antitrust and various state law claims in a suit concerning tours of two New Orleans cemeteries, Defendant New Orleans Archdiocesan Cemeteries d.b.a. New Orleans Catholic Cemeteries (“NOAC”)  and Defendant Cemetery Tours NOLA LLC (“CTN”). ACTGC also requested injunctive relief, which the district court denied, and ACTGC first appealed. The district court then dismissed ACTGC’s federal antitrust and state law claims, which ACTGC also appealed. Defendant NOAC then moved to dismiss the first appeal as moot.   The Fifth Circuit granted NOAC’s motion, dismissed the first appeal, and affirmed the judgment of the district court on all issues in the second appeal. The court agreed with NOAC and found that the first amended complaint is a legal nullity because it was not incorporated by the subsequent second amended complaint. Thus, because the first amended complaint is nullified, the court cannot consider—and thus must dismiss—an appeal of a denial of injunctive relief stemming from the complaint. Further, the court explained that the district court did not abuse its discretion in denying ACTGC leave to amend its complaint to add affidavits that do not add additional evidence of irreparable harm and do not address the pleading deficiencies of its federal law claims.   Moreover, the court held that ACTGC has not pleaded a legally sufficient product market under either of its proffered definitions. If the relevant product market is cemetery tours, it has not identified or included reasonably interchangeable substitutes. And if the product market is cemetery tours of Nos. 1 and 2, such a market is unduly narrow. View "New Orleans Assoc v. New Orleans Arch" on Justia Law