Justia Antitrust & Trade Regulation Opinion Summaries

The Ninth Circuit joined the Fourth and Sixth Circuits in holding that the collateral-order doctrine does not allow an immediate appeal of an order denying a dismissal motion based on state-action immunity. In this case, SolarCity filed a federal antitrust suit against the Power District, alleging that the Power District had attempted to entrench its monopoly by setting prices that disfavored solar power providers. The district court denied Power District's motion to dismiss the complaint based on the state-action immunity doctrine. Accordingly, the panel dismissed the interlocutory appeal based on lack of jurisdiction. View "SolarCity Corp. v. Salt River Project Agricultural Improvement and Power District" on Justia Law

Methodist and Saint Francis are the two largest hospitals in Peoria, Illinois. Saint Francis is considerably larger and more profitable. Methodist filed suit, charging Saint Francis with violating the Sherman Act by entering into exclusive contracts with insurance companies, covering more than half of all commercially-insured patients in the area. Methodist argued that it could not obtain a sufficiently high volume of patients to enable it to invest in improvements. The Seventh Circuit affirmed summary judgment in favor of Saint Francis, noting that health insurers regard Saint Francis as a “must have” hospital, because it provides certain services that the other hospitals in the area do not provide, such as solid-organ transplants, neonatal intensive care, and a Level 1 trauma center. The contracts are a form of requirements contract; an insurance company may get better rates from a hospital by agreeing to an exclusive contract, which will drive more business to the hospital. The contracts are of fixed duration; when they terminate, the insurance companies are free to contract with other hospitals. Competition-for-the-contract is protected by the antitrust laws and is common. The court noted that none of the other four area hospitals had joined the case and the Department of Justice declined to file a case. View "Methodist Health Services Corp v. OSF Healthcare System" on Justia Law

ACI Worldwide Corp. sued Baldwin Hackett & Meeks, Inc., its cofounders, and other company principals (collectively, BHMI), alleging that BHMI misappropriated its trade secrets. BHMI counterclaimed, alleging that ACI tortiously interfered with a business relationship and violated provisions of Nbraska’s unlawful restraint of trade statutes. In 2014, a jury found against ACI on its misappropriation claim. In 2015, a jury found in favor of BHMI on all of its counterclaims. ACI then filed posttrial motions to vacate the jury’s judgments, reopen the evidence, and grant a new trial on the basis that ACI had discovered new evidence. The district court overruled ACI’s posttrial motions. The Supreme Court affirmed, holding that the district court (1) did not abuse its discretion in overruling ACI’s motion to vacate the 2014 and 2015 judgments; and (2) did not abuse its discretion in awarding BHMI $2,732,962.50 in attorney fees. View "ACI Worldwide Corp. v. Baldwin Hackett & Meeks, Inc." on Justia Law

The court affirmed the issuance of a permanent injunction enjoining the merger of Anthem and Cigna under Section 7 of the Clayton Act, 15 U.S.C. 18. The court held that the district court did not abuse its discretion in enjoining the merger based on Anthem's failure to show the kind of extraordinary efficiencies necessary to offset the conceded anticompetitive effect of the merger in the fourteen Anthem states: the loss of Cigna, an innovative competitor in a highly concentrated market. The court also held that the district court did not abuse its discretion in enjoining the merger based on its separate and independent determination that the merger would have a substantial anticompetitive effect in the Richmond, Virginia large group employer market. View "United States v. Anthem" on Justia Law

Arabian Support & Services Co. (ASASCO), a Saudi Arabian business, sought compensation for assisting Textron Systems Corporation in its pursuit of a weapons deal in Saudi Arabia. ASASCO claimed that Textron backed away from its promises to supplement the modest fees paid under the parties’ written consulting agreements through an “offset” arrangement linked to the weapons sale. ASASCO’s complaint alleged breach of contract, tortious interference with ASASCO’s business and contractual relationship, and violations of Chapter 93A, the Massachusetts Deceptive Trade Practices Act. After limited discovery, the district court granted summary judgment for Textron on all of ASASCO’s claims. The First Circuit vacated the summary judgment in part, holding that the district court erred in dismissing ASASCO’s Chapter 93A misrepresentation claim based solely on the failure of the contract claim. Remanded for further proceedings on ASASCO’s misrepresentation theory. View "Arabian Support & Services Co. v. Textron Systems Corp." on Justia Law

Plaintiffs filed a class action against defendants alleging antitrust violations in connection with three categories of defendants' charged rates: unfiled fares, fuel surcharges, and special "discount" fares. Plaintiffs claimed that defendants colluded to fix the prices of certain passenger tickets and fuel surcharges on flights in violation of Section 1 of the Sherman Antitrust Act, 15 U.S.C. 1. On appeal, defendants challenged the district court's holding that the filed rate doctrine does not preclude plaintiffs' suit. The court explained that the filed rate doctrine is a judicially created rule that prohibits individuals from asserting civil antitrust challenges to an entity’s agency-approved rates. The court concluded that there are genuine issues of fact as to whether the DOT has effectively abdicated the exercise of its authority to regulate unfiled fares. Therefore, the district court did not not err in denying summary judgment to defendants as to those fares based on the filed rate doctrine. The court also concluded that the district court did not err by finding that genuine issues of material fact regarding the DOT's exercise of regulatory authority over fuel surcharges precluded entry of summary judgment for defendants. Finally, the court concluded that the district court did not err in declining to apply the doctrine to discount fares given the questions of fact regarding whether the discount fares constitute the same product as the fares actually filed. Accordingly, the court affirmed the district court's partial denial of defendants' motions for summary judgment. View "Wortman v. All Nippon Airways" on Justia Law

The consolidated appeals involve allegations that the companies holding the patents for Lipitor and Effexor XR delayed entry into the market by generic versions of those drugs by engaging in an overarching monopolistic scheme that involved fraudulently procuring and enforcing the underlying patents and then entering into a reverse-payment settlement agreement with a generic manufacturer. In 2013, the Supreme Court recognized that reverse payment schemes can violate antitrust laws and that it is normally not necessary to litigate patent validity to answer the antitrust question. The district judge dismissed most of plaintiffs’ claims. The Third Circuit remanded after rejecting an argument that plaintiffs’ allegations required transfer of the appeals to the Federal Circuit, which has exclusive jurisdiction over appeals from civil actions “arising under” patent law, 28 U.S.C. 1295(a)(1). Not all cases presenting questions of patent law necessarily arise under patent law; here, patent law neither creates plaintiffs’ cause of action nor is a necessary element to any of plaintiffs’ well-pleaded claims. The court remanded one of the Lipitor appeals, brought by a group of California pharmacists and involving claims solely under California law, for jurisdictional discovery and determination of whether remand to state court was appropriate. View "In re: Lipitor Antitrust Litigation" on Justia Law

Recreational Data Services, Inc. (RDS) attempted to develop and market a smartphone that would come preloaded with outdoor-oriented software. RDS pursued a partnership to advance the project with Trimble Navigation Limited, through one of its divisions, Trimble Mobile Computing Services (Trimble Mobile), and Remington Arms Company. Remington withdrew from the project after about two years of research and review. Several months later Trimble Mobile left the project shortly before a different Trimble division, Trimble Outdoors, launched a similar product. RDS sued Trimble for misrepresentation, breach of contract, and breach of fiduciary duty, alleging that Trimble Mobile intentionally delayed RDS’s project while sharing confidential information about it with Trimble Outdoors. A jury agreed with RDS and awarded it $51.3 million in lost profits. The superior court, however, concluded that RDS had not proven the amount of lost profits with reasonable certainty and granted Trimble a judgment notwithstanding the verdict. RDS appealed, arguing the superior court erroneously conflated the standards of proof for the fact of harm and the amount of damages and asks that the jury verdict be reinstated. After review, the Supreme Court concluded that it was error to grant a judgment notwithstanding the verdict because a reasonable juror could conclude that RDS proved all elements of its claims. Furthermore, the Court held that the superior court was correct to conclude that RDS failed to prove any amount of lost profits to a reasonable certainty as the law requires. The Supreme Court therefore granted remittitur, directing the superior court to make an award of nominal damages and enter judgment for RDS. View "Recreational Data Services, Inc. v. Trimble Navigation Limited" on Justia Law

Plaintiff-Appellant Suture Express, Inc. appeals from the district court’s entry of summary judgment in favor of Cardinal Health 200, LLC (“Cardinal”) and Owens & Minor Distribution, Inc. (“O&M”) under Section 1 of the Sherman Antitrust Act, Section 3 of the Clayton Act, and the Kansas Restraint of Trade Act (“KRTA”). Suture Express, Cardinal, and O&M compete in the national broadline medical-and-surgical (“med-surg”) supply and distribution market. After Suture Express entered the "suture-endo" market and steadily grew its market share, Cardinal and O&M responded by instituting bundling packages in their contracts. Suture Express sued Cardinal and O&M, alleging that their bundling arrangements constituted an illegal tying practice in violation of federal and state antitrust laws. The court held that Suture Express’s federal claims failed as a matter of law because it could not establish that either Cardinal or O&M individually possessed sufficient market power in the other-med-surg market that would permit it to restrain trade in the suture-endo market. Even were this not the case, however, the court also held that: (1) Suture Express could not establish antitrust injury because it had not shown that competition itself had been harmed; and (2) Cardinal and O&M cited sufficient procompetitive justifications for the bundling arrangement to overcome any harm caused by any anticompetitive effects resulting from the bundle. Viewing the evidence in the light most favorable to Suture Express, the Tenth Circuit did not think the company could survive summary judgment under Section 1 of the Sherman Act, Section 3 of the Clayton Act, or the Kansas Restraint of Trade Act. "There simply is not enough probative evidence by which a reasonable jury could find that Cardinal’s and O&M’s bundling arrangement unreasonably restrained trade in violation of federal or state antitrust law." View "Suture Express v. Owens & Minor" on Justia Law

Edinboro, a Pennsylvania public university, collaborated with Edinboro University Foundation, a nonprofit entity, to construct new dormitories. In 2008, the Foundation amended its Articles of Incorporation to authorize borrowing funds “to acquire, lease, construct, develop and/or manage real or personal property.” The University leased property to the Foundation in a favorable location; the Foundation issued bonds to raise the funds and completed construction. Since 1989, the University required non-commuting first-year and transfer students to reside on-campus for two consecutive semesters. Two and one-half years after the first phase of the new dormitories opened, the University amended its policy to require certain students to reside on-campus for four consecutive semesters. Businesses that provide off-campus housing sued, asserting that the University and the Foundation conspired to monopolize the student housing market in violation of the Sherman Act, 15 U.S.C. 2. Plaintiffs did not sue the University, conceding that it is an arm of the state subject to Eleventh Amendment immunity. The Third Circuit affirmed dismissal. The University’s actions are not categorically “sovereign” for purposes of “Parker” immunity, so the court employed heightened scrutiny, citing the Supreme Court’s decision in Town of Hallie v. City of Eau Claire, (1985), which requires anticompetitive conduct to conform to a clearly articulated state policy. The University’s conduct withstands Hallie scrutiny. The Foundation’s actions were directed by the University, so the Foundation is also immune. View "Edinboro College Park Apartments v. Edinboro University Foundation" on Justia Law