Justia Antitrust & Trade Regulation Opinion SummariesArticles Posted in Legal Ethics
Richmond Compassionate Care Collective v. 7 Stars Holistic Foundation
Richmond issued its first medical marijuana collective permit to RCCC. Three other permits were later issued. The ordinance was amended to reduce the number of dispensary permits from six to three; if a permitted dispensary did not open within six months after the issuance of a permit, the permit would expire. RCCC lost its permit. RCCC filed an antitrust complaint under the Cartwright Act, alleging that the other dispensaries paid for community opposition to RCCC’s applications and also purchased a favorably zoned property. Defendants filed a joint anti-SLAPP (strategic lawsuit against public participation) motion to strike (Code of Civil Procedure 425.16), which was granted as to allegations related to protected activity--statements made before the city council and defendants’ actions in opposing RCCC’s application. Allegations related to the property purchase were not stricken. Some defendants sought attorney fees. The trial judge determined that “defendants prevailed on their” anti-SLAPP motions and awarded 7 Stars $23,120 plus costs of $688.12. The court of appeal affirmed. There is no conflict between the anti-SLAPP statute, which permits an award of attorneys’ fees to a defendant and the Cartwright Act, which permits only a plaintiff to be “awarded a reasonable attorneys’ fee together with the costs of the suit” (Bus. & Prof. Code 16750(a)). View "Richmond Compassionate Care Collective v. 7 Stars Holistic Foundation" on Justia Law
Federal Trade Commission v. Penn State Hershey Medical Center
In March 2015, the Boards of Penn State Hershey Medical Center and PinnacleHealth formally approved a plan to merge. They had announced the proposal a year earlier; the Commonwealth of Pennsylvania and the Federal Trade Commission (FTC) were already investigating the impact of the proposed merger. This joint probe resulted in the FTC filing an administrative complaint alleging that the merger violated Section 7 of the Clayton Act, 15 U.S.C. 18. The FTC scheduled an administrative hearing for May 2016. The Commonwealth and the FTC jointly sued Hershey and Pinnacle under Section 16 of the Clayton Act, and Section 13(b) of the FTC Act, 15 U.S.C. 53(b) seeking a preliminary injunction. In September 2016, the Third CIrcuit reversed the district court and directed it to preliminarily enjoin the merger “pending the outcome of the FTC’s administrative adjudication.” Hershey and Pinnacle terminated their Agreement. The Commonwealth then moved for attorneys’ fees and costs, asserting that it “substantially prevailed” under Section 16 of the Clayton Act. The district court denied the motion, finding the Commonwealth had not “substantially prevailed” under Section 16. The Third Circuit affirmed, reasoning that it had ordered the injunction based on Section 13(b) of the FTC Act, not Section 16 of the Clayton Act. View "Federal Trade Commission v. Penn State Hershey Medical Center" on Justia Law
Daugherty v. Sheer
The DC Circuit held that two Federal Trade Commission attorneys were immune from suit for their conduct during an enforcement action against a medical-records company after the company's CEO publicly criticized the FTC about their investigation, where the company's data-security practices made patient records available over public file-sharing. The court held that qualified immunity protected all but the plainly incompetent or those who knowingly violate the law and, even if the attorneys sought to retaliate for the public criticism, their actions did not violate any clearly established right absent plausible allegations that their motive was the but-for cause of the Commission's enforcement action. Therefore, the court reversed the district court's denial of qualified immunity to the attorneys. View "Daugherty v. Sheer" on Justia Law
Transweb, LLC v. 3M Innovative Props. Co.
3M and TransWeb manufacture respirator filters, consisting of “nonwoven fibrous webs.” 3M sued Transweb for infringement of several patents. TransWeb sought a declaratory judgment of invalidity and non-infringement. A jury found the patents to be invalid based on TransWeb’s prior public use of the patented method. In accordance with an advisory verdict from the jury, the district court found the patents unenforceable due to inequitable conduct. An inventor for the patents and a 3M in-house attorney acted with specific intent to deceive the patent office as to the TransWeb materials. The district court awarded approximately $26 million to TransWeb, including trebled attorney fees as antitrust damages. The Federal Circuit affirmed, finding sufficient corroborating evidence to support the finding of prior public use by TransWeb, and that attorney fees are an appropriate basis for damages under the antitrust laws in this context. TransWeb’s attorney fees appropriately flow from the unlawful aspect of 3M’s antitrust violation and are an antitrust injury that can properly serve as the basis for antitrust damages. View "Transweb, LLC v. 3M Innovative Props. Co." on Justia Law
Roos v. Honeywell Int’l, Inc.
A class action complaint alleged that Honeywell engaged in uncompetitive and illegal conduct to increase its market share of round thermostats and to use its dominant market position to overcharge customers. In 2013, the parties reached a settlement and asked the trial court to preliminarily approve it. The court initially declined to do so because it had concerns about the notice proposed to be sent to class members. Those concerns were subsequently addressed to the court’s satisfaction, and on February 4, 2014, the court preliminarily approved the settlement. The notice of settlement was subsequently published and distributed to class members. The long version was distributed and posted on a website, and the short version was published in various print publications. The trial court found that four objectors to the settlement failed to establish they had standing, but rejected one objection on timeliness grounds and rejected the other three on their merits. The court of appeal affirmed, except for the ruling on standing, finding that the court properly approved the distribution of residual settlement funds and awarded class counsel attorney fees that amounted to 37.5 percent of the settlement fund. View "Roos v. Honeywell Int'l, Inc." on Justia Law
Legalzoom.com, Inc. v. McIllwain
Plaintiff obtained a last will and testament from LegalZoom.com. Before receiving the requested document, Plaintiff agreed to LegalZoom.com's terms of service, which included an arbitration provision. The agreement also provided that the Federal Arbitration Act (FAA) governed the interpretation and enforcement of the agreement's provisions. Plaintiff later filed a class-action lawsuit, alleging that LegalZoom.com engaged in the unauthorized practice of law, among other claims. LegalZoom.com filed a motion to compel arbitration. The trial court denied the motion based upon the allegations concerning the unauthorized practice of law. The Supreme Court reversed, holding (1) the circuit court erred because Arkansas law does not prohibit the enforcement of arbitration agreements requiring resolution through arbitration of private claims when a dispute concerns allegations of the unauthorized practice of law; and (2) any rule prohibiting arbitration of unauthorized practice-of-law claims were preempted by the FAA in this case. View "Legalzoom.com, Inc. v. McIllwain" on Justia Law