Justia Antitrust & Trade Regulation Opinion Summaries
Articles Posted in US Court of Appeals for the Eleventh Circuit
PDVSA US Litigation Trust v. Lukoil Pan Americas LLC, et al.
This appeal involves a nonjusticiable political question: who has the authority to litigate in the name of the Venezuelan state oil company, Petróleos de Venezuela, S.A. The underlying action, brought by a litigation trust on behalf of Petróleos de Venezuela, alleged conspiracy, antitrust, cybercrime, and fraud claims against various individuals and entities. After the district court dismissed the action for lack of standing and the Eleventh Circuit affirmed, an entity purporting to speak for Petróleos de Venezuela sought to substitute itself as the real party in interest. The entity’s board was appointed by Nicolás Maduro, who claims to be the president of Venezuela. But the United States Department of State has concluded that Maduro is not Venezuela’s legitimate political leader.
The Eleventh Circuit affirmed because the district court could not grant the motion without addressing a nonjusticiable political question. The district court cannot question the validity of then-President Guaidó’s appointment of an alternative board of directors. So, under the political-question doctrine, it was powerless to grant the Maduro entity’s motion to substitute the entity as the real party in interest in contravention of the position taken by the United States Department of State.
Further, the court wrote that the district court would not have jurisdiction to conduct the requested inquiry on remand. And even if the Department of State declared today that the Maduro entity is authorized to bring suit in Petróleos de Venezuela’s name, the court would still affirm because, under Article III, a justiciable case or controversy must exist “through all stages of the litigation,” including “at the time the complaint is filed.” View "PDVSA US Litigation Trust v. Lukoil Pan Americas LLC, et al." on Justia Law
Federal Trade Commission v. Steven J. Dorfman
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
Securities & Exchange Commission v. L.M.E. 2017 Family Trust, et al.
The Securities and Exchange Commission (SEC) initiated an enforcement action against several entities and individuals. The district court granted the unopposed motion and appointed Appellee as receiver, authorizing him to “take custody, control, and possession of all Receivership Entity records, documents, and materials” and to “take any other action as necessary and appropriate for the preservation of the Receivership Entities’ property interests.” Defendants didn’t appeal the order appointing Appellee as receiver. The district court granted the motion. Defendants appealed, contending that they weren’t afforded an adequate opportunity to be heard before the receivership estate’s expansion. Appellee has moved to dismiss Defendants’ appeal for lack of jurisdiction.The Eleventh Circuit dismissed the appeal. The court found that neither Section 1292(a)(2) nor Section 1292(a)(1) grants the court jurisdiction to consider the appeal because the expansion order was neither an order appointing a receiver nor an order granting (or modifying) an injunction. The court explained that to the extent that the appointment of the receiver or the expansion of his duties could be viewed as an injunction at all, the district court possessed freestanding authority to enter it. Given that the district court had both statutory and residual equitable authority to establish and expand the receivership, it had no cause to invoke the All Writs Act to aid its jurisdiction. View "Securities & Exchange Commission v. L.M.E. 2017 Family Trust, et al." on Justia Law
OJ Commerce, LLC, et al. v. KidKraft, Inc., et al.
OJ Commerce and Naomi Home sued KidKraft and MidOcean. OJ Commerce and Naomi Home alleged that “KidKraft control[led] over 70% of the wooden play kitchen market in the continental United States.” They asserted that “KidKraft’s termination of its relationship with OJ[] [Commerce] had no legitimate business justification or procompetitive benefit” and violated section two of the Sherman Act. They asserted that, alternatively, the termination was a form of attempted monopolization, a separate violation of section two. The district court entered summary judgment in favor of KidKraft and MidOcean.
The Eleventh Circuit affirmed the summary judgment order. The court held that the district court correctly entered a summary judgment in favor of MidOcean and KidKraft on the section-one claim. The court reasoned that a company ordinarily cannot conspire with an entity it owns and controls and with which it does not compete. Here, MidOcean owns nothing other than its interest in KidKraft that sells toys of any type. And as noncompetitors, MidOcean and KidKraft are incapable of conspiring for purposes of section one because the evidence establishes that MidOcean has majority ownership of and controls KidKraft. It is undisputed that, during the relevant period, MidOcean owned approximately 57 percent of the membership interests in the company that wholly owns KidKraft.Further, the court held that the district court correctly entered a summary judgment against the section-two claim because OJ Commerce and Naomi Home failed to present substantial evidence to support a viable theory of monopolization. View "OJ Commerce, LLC, et al. v. KidKraft, Inc., et al." on Justia Law
Federal Trade Commission v. On Point Capital Partners LLC
The FTC filed suit under 15 U.S.C. 53(b) of the Federal Trade Commission Act (FTCA) against appellants, alleging that they had engaged in unfair or deceptive business practices in violation of 15 U.S.C. 45(a) under the collective name of "On Point." On appeal, On Point challenges the district court's preliminary injunction.The Eleventh Circuit affirmed parts of the preliminary injunction enjoining appellants from misrepresenting their services and releasing consumer information. However, while this appeal was pending, the Supreme Court held in AMG Capital Management that section 53(b) does not permit an award of equitable monetary relief such as restitution or disgorgement, leaving the asset freeze and receivership aspects of the preliminary injunction unsupported by law. Therefore, the court vacated parts of the preliminary injunction subjecting the remaining appellants at issue to the asset freeze and receivership to the extent the district court has not already provided relief. View "Federal Trade Commission v. On Point Capital Partners LLC" on Justia Law
American Contractors Supply, LLC v. HD Supply Construction Supply, Ltd.
The Eleventh Circuit affirmed the district court's grant of summary judgment against ACS and in favor of its competing distributor, White Cap, on ACS's Sherman Antitrust Act and Georgia state law claims. ACS argues that summary judgment was erroneously granted because the evidence demonstrates that White Cap agreed with Meadow Burke to have Meadow Burke stop supplying ACS projects in Florida.The court held that the evidence is at least equally consistent with Meadow Burke having made an independent decision to terminate ACS as it is with an inference of concerted action. Furthermore, the evidence is at least equally consistent with White Cap having made an independent decision to continue distributing the Meadow Burke product as it is with it having engaged in concerted action. Therefore, the court cannot conclude that White Cap acted in a manner rising to the level of anticompetitive conduct necessary for a claim under section 1 of the Sherman Antitrust Act. The court also held that the district court did not err in granting summary judgment on ACS's monopolization and attempted monopolization claims pursuant to section 2 of the Sherman Antitrust Act. Finally, the court held that the district court properly granted summary judgment on the tortious interference claim. View "American Contractors Supply, LLC v. HD Supply Construction Supply, Ltd." on Justia Law
SmileDirectClub, LLC v. Battle
SmileDirect filed suit against the Georgia Board of Dentistry, including the Board’s members in their individual capacities, alleging inter alia, antitrust, Equal Protection, and Due Process violations related to the amendment of Ga. Bd. of Dentistry R. 150-9-.02. On appeal, the Board members challenged the denial of their motion to dismiss the complaint with respect to the alleged antitrust violations.After determining that it does have appellate jurisdiction under the collateral order doctrine, the Eleventh Circuit affirmed, holding that, based on the facts alleged in SmileDirect's complaint, the Board members are not entitled to state-action immunity under Parker v. Brown, 317 U.S. 341 (1943), at this point in the litigation, and the district court properly denied their motion to dismiss. In this case, the Board members have failed to satisfy the Midcal test by failing to meet the "active supervision" prong of the test and both prongs are necessary to satisfy the test. Furthermore, the court rejected the Board members' argument that ipso facto state-action immunity is available merely because of the Governor's power and duty, and without regard to his actual exercise thereof. The court explained that the Board members have established no more than the mere potential for active supervision on the part of the Governor, and thus they have fallen far short of establishing that the amended rule was "in reality" the action of the Governor. View "SmileDirectClub, LLC v. Battle" on Justia Law
Automotive Alignment & Body Service, Inc. v. State Farm Mutual Automobile Insurance Co.
Automotive body shops filed suit against major automobile insurance companies, alleging claims for relief under the Sherman Act and state law based on the insurance companies' alleged anticompetive practices.The Eleventh Circuit held that it lacked jurisdiction to decide the merits of the Indiana and Utah appeals because the orders dismissing the first amended complaints became final judgments under Hertz Corporation v. Alamo Rent-ACar, Incorporated, 16 F.3d 1126 (11th Cir. 1994), when the deadline to amend expired. However, the court held that it had jurisdiction to review the order dismissing the Mississippi body shops’ antitrust claims. The court also held that the district court correctly dismissed the antitrust claims; the district court did not abuse its discretion in denying the Mississippi body shops' motion to reconsider its dismissal of their antitrust claims; and the district court correctly dismissed most of the Mississippi body shops' claims under state law. Accordingly, the court vacated in part, affirmed in part, and remanded for further proceedings. View "Automotive Alignment & Body Service, Inc. v. State Farm Mutual Automobile Insurance Co." on Justia Law
Quality Auto Painting Center of Roselle, Inc. v. State Farm Indemnity Co.
The Body Shops filed suit alleging that defendant insurance companies colluded to lower repair prices by improperly pressuring the shops to lower prices and by threatening to boycott those who did not comply. The Body Shops claimed a per se price-fixing conspiracy and a per se conspiracy to boycott, as well as state law claims.The Eleventh Circuit affirmed the district court's dismissal of all of the Body Shop's federal antitrust and state law claims except the tortious interference claims. Although the court held that the unjust enrichment and quantum meruit claims of the Body Shops were wholly without merit, the court vacated the district court's judgment as to the tortious interference claims because the court was not persuaded by the district court's grounds for concluding that the allegations of tortious interference in each of these five cases violated the group pleading doctrine, i.e., failed to give fair notice to each defendant of the claim being made against it. The court remanded for further proceedings. View "Quality Auto Painting Center of Roselle, Inc. v. State Farm Indemnity Co." on Justia Law
Quality Auto Painting Center of Roselle, Inc. v. State Farm Indemnity Co.
The Eleventh Circuit reversed the dismissal of five complaints filed by automobile body shops, asserting federal antitrust and state tort claims against insurance companies. The court held that the shops pleaded enough facts to plausibly support their federal antitrust and state tort claims. In this case, the body shops argued that the insurance companies engaged in two lines of tactics in pursuit of a single goal: to depress the shops' rates for automobile repair. The body shops have supplied enough allegations to raise a reasonable expectation that discovery will reveal evidence of an illegal agreement; the body shops have consistently alleged the existence of parallel conduct and of plus factors allowing a plausible inference of an illegal agreement; and the allegations have sufficiently established the body shops' state tort claims of unjust enrichment, quantum meruit, and tortious interference. Accordingly, the court remanded for further proceedings. View "Quality Auto Painting Center of Roselle, Inc. v. State Farm Indemnity Co." on Justia Law