Justia Antitrust & Trade Regulation Opinion Summaries

Lexmark manufactures printers and toner cartridges. Remanufacturers acquire used Lexmark cartridges, refill them, and sell them at a lower cost. Lexmark developed microchips for the cartridges and the printers so that Lexmark printers will reject cartridges not containing a matching microchip and patented certain aspects of the cartridges. SC began replicating the microchips and selling them to remanufacturers along with other parts for repair and resale of Lexmark toner cartridges. Lexmark sued SC for copyright violations related to its source code in making the duplicate microchips and obtained a preliminary injunction. SC counterclaimed under federal and state antitrust and false-advertising laws. While that suit was pending, SC redesigned its microchips and sued Lexmark for declaratory judgment to establish that the redesigned microchips did not infringe any copyright. Lexmark counterclaimed again for copyright violations and added patent counterclaims. The suits were consolidated. The Sixth Circuit vacated the injunction and rejected Lexmark’s copyright theories. On remand, the court dismissed all SC counterclaims. A jury held that SC did not induce patent infringement and advised that Lexmark misused its patents. The Sixth Circuit affirmed dismissal of federal antitrust claims, but reversed dismissal of SC’s claims under the Lanham Act and certain state law claims. View "Static Control Components, Inc v. Lexmark Int'l, Inc." on Justia Law

In an antitrust class action alleging a conspiracy to fix prices in violation of the Sherman Act, 15 U.S.C. 1, the district court entered summary judgment in favor of defendants, manufacturers and sellers of “publication paper,” a type of paper used in preparing printed material of various types. Plaintiffs, direct purchasers of defendants’ paper products, claimed that defendants’ price hikes mirrored each other in amount and occurred in close succession and were instituted pursuant to an agreement, rather than independently. Plaintiffs also claimed that, in the same time frame, two defendants coordinated the closure of paper mills in order to reduce the supply of publication paper. The Second Circuit vacated in part. A jury could reasonably find that defendants entered into an agreement to raise the price of publication paper, and that, as implemented, this agreement damaged plaintiffs. View "In re: Publ'n Paper Antitrust Litig." on Justia Law

Avisma produces magnesium and titanium sponge in Russia. The process starts with a dehydration step. Most of the resultant raw magnesium is then processed into pure and alloyed magnesium, the subject of an antidumping order issued by Commerce in response to a petition by domestic producers. A portion of the raw magnesium is used to produce titanium sponge. After Commerce imposed a 15.77 percent duty, the Trade Court remanded the case. On remand, Commerce declined to alter the determination. The Trade Court then held that, when determining Avisma’s magnesium production costs for purposes of calculating the constructed value of Avisma’s magnesium, Commerce was required to take into account Avisma’s entire production process, which includes titanium, as well as magnesium. In its second remand determination, Commerce determined the constructed value of Avisma’s magnesium by taking into account Avisma’s entire production process, resulting in an antidumping duty of 8.51 percent. The Trade Court issued final judgment accordingly. The Federal Circuit reversed and reinstated Commerce’s earlier decision. The Trade Court erred in requiring Commerce to consider an affidavit by Avisma’s accountant that Commerce had determined was untimely. View "PSC VSMPO-Avisma Corp. v. United States" on Justia Law

A proposed consent order from an FTC investigation indicated that U-Haul attempted to implement a scheme to collude with competitors, Budget and Penske, to raise prices for truck rentals. The FTC concluded that U-Haul's conduct violated the Federal Trade Commission Act, 15 U.S.C. 45(a)(1). The proposed consent order was designed to prevent collusion. U-Haul consented to the relief, but did not admit the conduct or violation. A consumer filed a complaint charging U-Haul with violating Mass. Gen. Laws ch. 93A by engaging in an attempted price-fixing scheme and seeking damages on behalf of a large class. The suit, a follow-on action after a proposed government consent decree, is common in antitrust cases. Because the FTC Act contains no private right of action and the Sherman Act is of doubtful application to price-fixing, the suit rested chapter 93A, which prohibits "[u]nfair methods of competition and unfair or deceptive acts or practices," and permits consumer class actions. The complaint alleged that U-Haul's actions caused plaintiff to pay at least 10 percent more for truck rentals than she would have absent the unlawful action. The district court dismissed, stating that the complaint failed plausibly to allege injury. The First Circuit vacated, finding the claim plausible. View "Liu v. Amerco" on Justia Law

Plaintiffs are among the world’s largest purchasers of air conditioning and refrigeration copper tubing. Defendants imported ACR copper into the U.S. In 2003 the Commission of the European Communities found that defendants and other conspired on prices targets and other terms for industrial tubes and allocated customers and market shares in violation of European law. The findings did not identify any conspiratorial agreements with respect to U.S. markets. In 2004, another EC decision found violation in the market for plumbing tubes. Plaintiff claimed that the European conspiracy was also directed at the U.S. market for ACR industrial tubes, violating the Sherman Act and the Tennessee Trade Practices Act. Two similar cases, involving different plaintiffs, had been dismissed. The district court dismissed for lack of subject matter jurisdiction and failure to state a claim. The Sixth Circuit reversed, finding that the complaint adequately stated a claim under the Sherman Act and was not barred by the Act's limitations period, 15 U.S.C. 15b and that the court had personal jurisdiction. The fact that the complaint borrows its substance from the EC decision and then builds on the EC’s findings does not render its allegations any less valid.View "Carrier Corp. v. Outokumpu Oyj" on Justia Law

In 2009 the fire protection district adopted an ordinance requiring commercial buildings and multi-family residences to have fire alarms equipped with wireless radio technology to send alarm signals directly to the district's central monitoring board. The ordinance provided that the district would contract with one private alarm company to provide and service signaling equipment, displacing several private fire alarm companies that have competed for these customers. The alarm companies sued on claims under the U.S. Constitution, federal antitrust law, and state law. The district court granted summary judgment for the alarm companies on the basis of state law and enjoined the district from implementing the ordinance. The Seventh Circuit affirmed in part, holding that the district has statutory authority to require that commercial and multi-family buildings connect directly to its monitoring board through wireless radio technology. The district does not, however, have authority to displace the entire private market by requiring all customers to buy services and equipment from itself or just one private company. View "ADT Sec. Servs., Inc. v. Lisle-Woodridge Fire Prot. Dist." on Justia Law

A 1998 settlement (MSA), between states and large tobacco companies (OPMs) included incentives for non-parties to join, but OPMs retained the most favorable payment terms. The MSA permitted states to enact statutes requiring nonparticipants to make deposits into escrows to be held for 25 years, in case a state obtained a future judgment against that nonparticipant. The MSA ensured that OPMs retained favored treatment over other participants. Plaintiff entered the market in 2000, as a nonparticipant, paying into state escrow accounts. As escrow payments became more burdensome, Plaintiff joined the MSA after negotiating a back-payment and future payments. During negotiations, defendants denied Plaintiff information about payment reductions granted to grandfathered companies. Plaintiff, unhappy with the disparate treatment and unable to meet its obligations, was unable to negotiate better terms because of an MSA provision that would entitle other participants to more favorable terms if such terms were granted to a late-joiner. Plaintiff sued tobacco manufacturers and attorneys general, alleging antitrust (15 U.S.C. 1, 3 (a)) and constitutional violations. The district court dismissed. The Sixth Circuit affirmed. Manufacturer defendants were immunized under the Noerr-Pennington and state-action doctrines. Plaintiff's waivers were knowing, intelligent, and voluntary, regardless of representations made during negotiations. View "VIBO Corp., Inc. v. Conway" on Justia Law

In 2006, BP began converting company-operated gas and convenience stores into franchisee-operated stores. From 2006 to 2008, plaintiffs purchased gas station sites and entered into long-term contracts with BP for fuel and use of BP's brand name and marks. In 2009 plaintiffs sued under the Illinois Franchise Disclosure Act. Consolidated cases were removed to federal court when plaintiffs added claims under the federal Petroleum Marketing Practices Act. They later added price discrimination claims under the Robinson-Patman Act. Before trial, all federal claims were withdrawn. The district judge relinquished supplemental jurisdiction and remanded to Illinois state court. The Seventh Circuit affirmed. A district court has broad discretion and the general presumption in favor of relinquishment was particularly strong because the state-law claims are complex and raise unsettled legal issues. View "RWJ Mgmt. Co., Inc. v. BP Prod. N. Am., Inc." on Justia Law

Plaintiff, sued by a competitor and by consumers for unfair trade practices, false and misleading advertising, and deceptive labeling, among other claims, sought indemnity and defense costs from its insurer. The insurer claimed that the suit fell within an exclusion for "antitrust violations, price fixing, price discriminations, unfair competition, deceptive trade practices and/or monopolies." The district court ruled in favor of the insurer. The First Circuit affirmed, finding that the policy headings were not determinative and that the paragraph at issue clearly excluded coverage. View "Welch Foods, Inc. v. Nat'l Union Fire Ins.Co. of Pittsburgh" on Justia Law

Factors purchase accounts receivable to assume garment manufacturers' risk with respect to amounts owed by retailer. A manufacturer typically cannot make sales to retailers for which factors decline to assume the risk. Factors determine the terms and conditions, including the discount rate at which they purchase receivables, payment terms required of retailers, and whether purchases by particular retailers will be financed. Plaintiff, a major discount clothing retailer had sub-par performance and declining sales for two years. Factors declined to extend credit, which caused increased costs and decreased profitability until plaintiff filed for bankruptcy. The trustee filed suit under the Sherman Act, 15 U.S.C. 1, and New York law, alleging that factors engaged in "cartel-like behavior," unlawfully exchanged information, and entered into illegal agreements in secretive weekly meetings and telephone conversations to minimize their risks and cost of doing business, maintain and stabilize pricing structures for factoring services; and stabilize their respective market shares. The district court dismissed. The Third Circuit affirmed, finding no direct evidence of agreement between the factors or of parallel behavior. View "Burtch v. Milberg Factors, Inc." on Justia Law