Justia Antitrust & Trade Regulation Opinion Summaries

Drummond Financial Services, LLC and TMX Finance Holdings, Inc. were competitors in the automobile title loan business. Both companies were based in Georgia, with TMX doing business as “TitleMax.” In 2014, Drummond and several of its affiliated companies filed a lawsuit against TitleMax and several of its affiliated companies, alleging that TitleMax was “engaged in a nationwide campaign to systematically and illegally steal [Drummond’s] customers.” Based on these allegations, Drummond asserted claims against TitleMax under the laws of Georgia and various other states for trespass, misappropriation of trade secrets, tortious interference with contracts, and unfair competition. Drummond filed a motion for a nationwide interlocutory injunction to prevent TitleMax from continuing to engage in practices that Drummond alleged were tortious and illegal. Following a hearing, the trial court granted a nationwide interlocutory injunction that prohibited TitleMax from “[e]ntering any of [Drummond’s] [s]tores or the parking lots [or certain portions of the parking lots] of [Drummond’s] [s]tores” to solicit Drummond customers or to record their license plate numbers or vehicle identification numbers (other than for purposes permitted by the Driver’s Privacy Protection Act). In addition, the injunction prohibited TitleMax from offering compensation to Drummond employees to refer Drummond customers to TitleMax. TitleMax appealed. Those aspects of the injunction appeared to the Georgia Supreme Court to have been based on the claims for trespass and misappropriation of trade secrets, but the laws of trespass and trade secrets (at least in Georgia) did not support the scope of the injunction. Accordingly, the Court vacated the injunction in those respects, and remanded for the trial court to reconsider the scope of its injunction. To the extent that the parties on remand might rely on law that varies significantly from state to state, the Court reminded them that activities in one state are not due to be enjoined simply because they might be unlawful if done in another state. View "TMX Financial Holdings, Inc. v. Drummond Financial Services, LLC" on Justia Law

CACH, LLC filed a complaint against William Echols alleging that Echols breached his contract with a bank when he defaulted on his obligation to pay for charges incurred on a credit card and that, as current owner of the account, CACH was entitled to payment of the balance due on the credit card. Echols filed a class action counterclaim alleging that CACH violated the Arkansas Deceptive Trade Practices Act and the common law when it demanded payment from and filed suit against Echols and other Arkansas residents. The circuit court entered an order granting class certification. The Supreme Court affirmed, holding that the circuit court did not err in granting class certification. View "CACH, LLC v. Echols" on Justia Law

Limoliner Inc., which owned and operated a fleet of luxury motor coaches, hired Dattco, Inc. to perform repair work on one of those vehicles. While Dattco recorded most of those requests in writing, Dattco neglected to write down Limoliner’s verbal request to repair one of the vehicle’s important electrical components. When Dattco failed to make any repairs to that component, Limoliner commenced this action, alleging, inter alia, that Dattco violated Mass. Gen. Laws ch. 93A, 2(a), as interpreted by 940 Code Mass. Regs. 5.05(2), by failing to record Limoliner’s request in writing. Dattco removed the case to federal court on the basis of diversity jurisdiction. Following a jury-waived trial, a magistrate judge found for Dattco on Limoliner’s regulatory claim under 940 Code Mass. Regs. 5.05, concluding that the provision at issue applies only to consumer transactions and not to transactions where the customer is another business. Limoliner appealed, and the United States Court of Appeals for the First Circuit certified a question regarding the issue to the Supreme Court. The Supreme Court answered that 940 Code Mass. Regs. 5.05 does apply to transactions in which the customer is a business entity. View "Limoliner, Inc. v. Dattco, Inc." on Justia Law

In April 2014, two consumers filed a class action against BF Labs, asserting “deceptive and unconscionable business practices” in marketing and selling Bitcoin mining machines. Five months later, the Federal Trade Commission sued BF for unfair and deceptive acts, 15 U.S.C. 45(a). The court stayed pending suits and imposed a receivership. The stay was subsequently lifted. The two consumers were denied leave to intervene in the FTC action. The Eighth Circuit affirmed, agreeing that the interests of the consumers’ proposed class are subsumed within the public interest because the FTC, on behalf of consumers, sought relief for the same “deceptive and unconscionable business practices” alleged by the consumers. The consumers have not made the necessary “strong showing of inadequate representation.” View "Alexander v. Fed. Trade Comm'n" on Justia Law

In earlier litigation, Teva challenged the validity and enforceability of GSK’s patents on lamotrigine, Lamictal’s active ingredient. Teva was first to file an FDA application, alleging invalidity or nonenforceability, and seeking approval to produce generic lamotrigine tablets and chewable tablets for markets alleged to be annually worth $2 billion and $50 million,. If the patent suit resulted in a determination of invalidity or nonenforceability—or a settlement incorporating such terms—Teva would be statutorily entitled to a 180- day period of market exclusivity, during which time only it and GSK could produce generic lamotrigine tablets. After the judge ruled the patent’s main claim invalid, the companies settled; Teva would end its patent challenge in exchange for early entry into the chewables market and GSK’s commitment not to produce its own, “authorized generic” Lamictal tablets. Plaintiffs, direct purchasers of Lamictal, sued under the Sherman Act, 15 U.S.C. 1 & 2, claiming that the agreement was a “reverse payment” intended to induce Teva to abandon the patent fight and eliminate the risk of competition in the lamotrigine tablet market for longer than the patent would otherwise permit. The district court dismissed. The Third Circuit vacated, citing Supreme Court precedent, holding that unexplained large payments from the holder of a drug patent to an alleged infringer to settle litigation of the patent’s validity or infringement (reverse payment) can violate antitrust laws. View "King Drug Co of Florence Inc, v. Smithkline Beecham Corp." on Justia Law

During Plaintiff’s marriage dissolution proceedings, Nancy Smith served as guardian ad litem for Plaintiff’s children. After Plaintiff stopped paying bills to Smith, Smith assigned the unpaid bills to Collection Professionals, Inc. (CPI). CPI filed a complaint to collect the debt. Thereafter, Plaintiff filed this action alleging, among other claims, that Collection Professionals, Inc. (CPI) violated the Fair Debt Collection Practices Act (FDCPA) by attempting to collect a false debt. CPI counterclaimed for the amount owed for Smith’s services. The district court entered summary judgment in favor of CPI and Smith. The Supreme Court affirmed, holding that the district court (1) correctly awarded summary judgment to CPI on Plaintiff’s FDCPA claim because the FDCPA did not apply under the circumstances of this case; (2) correctly awarded summary judgment to Smith; and (3) correctly awarded CPI $7,408 in damages plus interest. View "Amour v. Collection Prof’ls, Inc." on Justia Law

In this putative nationwide class action Plaintiffs claimed that they were deceived into purchasing Defendants’ “natural” cosmetics, which contained allegedly synthetic and artificial ingredients. Plaintiffs sought injunctive relief and damages under the federal Magnuson-Moss Warranty Act, California’s unfair competition and false advertising laws, and common law theories of fraud and quasi-contract. The district court dismissed the quasi-contract cause of action for failure to state a claim and dismissed the state law claims under the primary jurisdiction doctrine so that the parties could seek expert guidance from the Food and Drug Administration (FDA). A panel of the Ninth Circuit reversed, holding (1) the Food, Drug, and Cosmetic Act does not expressly preempt California’s state law causes of action that create consumer remedies for false or misleading cosmetics labels; (2) although the district court properly invoked the primary jurisdiction doctrine, it erred by dismissing the case rather than staying proceedings while the parties sought guidance from the FDA; and (3) the district court erred in dismissing the quasi-contract cause of action as duplicative of or superfluous to Plaintiffs’ other claims. View "Astiana v. Hain Celestial Group, Inc." on Justia Law

Plaintiff filed a false advertising lawsuit against Johnson & Johnson and McNeil Nutritionals, LLC (collectively, McNeil) challenging several of McNeil’s assertions about its product, Benecol, a vegetable oil-based spread. Specifically, Plaintiff alleged that McNeil’s claims about its product were not authorized under the FDA’s regulations and were false. Plaintiff asserted claims for relief on behalf of a putative class of Benecol purchasers under California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act. The district court granted McNeil’s motion to dismiss, concluding that Plaintiff lacked standing because he failed to plead reasonable reliance on any misrepresentations and that Plaintiff’s claims for relief were preempted under federal law. The Ninth Circuit reversed, holding (1) Plaintiff had standing to challenge McNeil’s statements; (2) Plaintiff’s claims for relief were not preempted to the extent they were predicated on McNeil’s statements about trans fat, and a certain FDA letter was not entitled to preemptive effect; and (3) Plaintiff’s action was not barred by the primary jurisdiction doctrine. Remanded. View "Reid v. Johnson & Johnson" on Justia Law

AstraZeneca, which sells a heartburn drug called Nexium, and three generic drug companies (“generic defendants”) that sought to market generic forms of Nexium, entered into settlement agreements in which the generic defendants agreed not to challenge the validity of the Nexium patents and to delay the launch of their generic products. Certain union health and welfare funds that reimburse plan members for prescription drugs (the named plaintiffs) alleged that the settlement agreements constituted unlawful agreements between Nexium and the generic defendants not to compete. Plaintiffs sought class certification for a class of third-party payors, such as the named plaintiffs, and individual consumers. The district court certified a class. Relevant to this appeal, the class included individual consumers who would have continued to purchase branded Nexium for the same price after generic entry. The First Circuit affirmed the class certification, holding (1) class certification is permissible even if the class includes a de minimis number of uninjured parties; (2) the number of uninjured class members in this case was not significant enough to justify denial of certification; and (3) only injured class members will recover. View "In re Nexium Antitrust Litig." on Justia Law

When Appellant, a resident of the Pondview Condominiums, did not pay his condominium fees on time, the condominium trustees hired law firm Marcus, Errico, Emmer and Brooks, P.C. (“MEEB”) to collect Appellant’s debt. MEEB filed nine collection actions in Massachusetts state court against Appellant and prevailed in two of them. Displeased with MEEB’s collection activities, Appellant sued MEEB in federal district court, alleging violations of federal and state law. The magistrate judge concluded that MEEB committed numerous violations of the Fair Debt Collection Practices Act (FDCPA) and that the FDCPA violations constituted “per se” violations of Mass. Gen. Laws ch. 93A. Upon reconsideration, the magistrate judge reversed in part, finding MEEB not liable under Chapter 93A. The First Circuit reversed the magistrate judge’s determination that MEEB was not liable under Chapter 93A, holding that MEEB’s violations of the FDCPA constituted per se Chapter 93A violations by virtue of the unambiguous statutory language in the FDCPA and the Federal Trade Commission Act. View "McDermott v. Marcus, Errico, Emmer & Brooks" on Justia Law