Articles Posted in Antitrust & Trade Regulation

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BikerGear filed suit against FedEx, accusing FedEx of fraudulently marking up the weights of packages shipped by BikerGear and overcharging BikerGear for Canadian customers, in violation of the Interstate Commerce Commission Termination Act of 1995 (ICCTA), 49 U.S.C. 13708(b), and the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962(c). The Second Circuit affirmed the district court's dismissal of the ICCTA claim on the pleadings, and the district court's grant of summary judgment for FedEx and dismissal of BikerGear's substantive RICO claims. The court held that (1) Section 13708 of the ICCTA requires shipping documents to truthfully disclose the charges that a motor carrier in fact assesses, and prohibits a motor carrier from stating it will charge one amount when in reality it charges another; and (2) where, as here, the RICO persons and the RICO enterprise were corporate parents and wholly‐owned subsidiaries that "operate within a unified corporate structure" and were "guided by a single corporate consciousness," the mere fact of separate incorporation, without more, did not satisfy RICO's distinctness requirement under Section 1962(c). View "U1IT4Less Inc. v. FedEx Corp." on Justia Law

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This case arose out of a dispute over subcontracting clauses in collective bargaining agreements (CBAs) between the Carpenters' Union and various construction companies and construction managers. The clauses effectively barred subcontracting of construction work with non-Carpenter affiliates. Ironworkers alleged that the Carpenters have used these subcontracting clauses to expand the scope of work assigned to the Carpenters Union to include work traditionally assigned to the Ironworkers. The district court granted summary judgment to the Carpenters. The Second Circuit held that the Carpenters have met the requirements of the construction industry proviso of Section 8(e) of the National Labor Relations Act, but that, on this record, there were factual disputes that precluded a decision on whether the conduct fell within the non‐statutory exemption to antitrust liability. The court explained, to demonstrate that the disputed subcontracting practices were sheltered by the non‐statutory exemption (and thus to defeat the Ironworkers' antitrust claim completely), the Carpenters must show that these practices furthered legitimate aims of collective bargaining, in a way that was not unduly restrictive of market competition. Accordingly, the court vacated the district court's judgment as to the Sherman Act claim; affirmed as to the unfair labor practices claim; and remanded. View "Conn. Ironworkers Employers Assoc. v. New England Regional Council of Carpenters" on Justia Law

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The Second Circuit affirmed the district court's grant of summary judgment in favor of Simon & Schuster on the issues of antitrust injury and causation. Lavoho, successor in interest to Diesel, filed this antitrust action for business injuries it alleges arose from an unlawful conspiracy in restraint of trade between Apple, Inc. and five major publishing companies. The district court determined that Diesel's business was not grounded in price competition, that it contemporaneously viewed the adoption of agency pricing as a boon, and that its decline was not a legally cognizable antitrust injury flowing from the unlawful nature of the conspiracy. The court agreed and held that there was no genuine dispute as to any material fact underlying the conclusion that, as a matter of law, Diesel suffered no antitrust injury caused by the unlawful antitrust conspiracy. View "Diesel eBooks, LLC v. Simon & Schuster, Inc." on Justia Law

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The Second Circuit affirmed the district court's grant of summary judgment in favor of publishing companies on issues of antitrust injury and causation. Abbey House, dba BooksOnBoard, filed this civil antitrust action for business injuries it alleges arose from an unlawful conspiracy in restraint of trade between Apple, Inc. and five major publishing companies. The district court determined that BooksOnBoard faced strong competition from large retailers, that it contemporaneously viewed the adoption of agency pricing as a boon, and that its subsequent demise was not attributable to the unlawful conspiracy. The court agreed and held that there was no material fact in dispute underlying the conclusion that, as a matter of law, BooksOnBoard suffered no antitrust injury caused by the unlawful antitrust conspiracy. View "Abbey House Media, Inc. v. Simon & Schuster, Inc." on Justia Law

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Plaintiffs filed a class action alleging that Takeda prevented competitors from timely marketing a generic version of Takeda’s diabetes drug ACTOS by falsely describing two patents to the FDA. Plaintiffs claimed that these false patent descriptions channeled Takeda’s competitors into a generic drug approval process that granted the first-filing applicants a 180-day exclusivity period, which in turn acted as a 180-day "bottleneck" to all later-filing applicants. 9 out of 10 generic applicants took that route. Teva was prevented from seeking approval via another regulatory mechanism when the FDA announced that all generic manufacturers would be required to take the bottlenecked route. Plaintiffs alleged that they were wrongfully obligated to pay monopoly prices for ACTOS when Takeda's patent on the active ingredient in ACTOS expired when the mass of generic market entry occurred. The district court dismissed plaintiffs' antitrust claims. The court affirmed to the extent that plaintiffs' theory posits a delay in the marketing of generic alternatives to ACTOS by all the generic applicants other than Teva, because plaintiffs' theory presupposes that these applicants were aware of Takeda’s allegedly false patent descriptions when they filed their applications, which is not supported by well-pleaded allegations. However, the court concluded that plaintiffs' theory as to Teva does not require any knowledge of the false patent descriptions. Therefore, the court reached other issues as to Teva and found plaintiffs plausibly alleged that Takeda delayed Teva's market entry. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "In re ACTOS End-Payor Antitrust Litigation" on Justia Law

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Amex appealed from the district court's decision finding that it unreasonably restrained trade in violation of section 1 of the Sherman Act, 15 U.S.C. 1, by entering into agreements containing nondiscriminatory provisions (NDPs). The district court held that Amex was liable for violating section 1 and enjoined Amex from enforcing its NDPs. The court concluded that the district court erred here in focusing entirely on the interests of merchants while discounting the interests of cardholders. Plaintiffs bore the burden in this case to prove net harm to Amex consumers as a whole - that is, both cardholders and merchants - by showing that Amex’s nondiscriminatory provisions have reduced the quality or quantity of credit‐card purchases. The court concluded that, given the district court’s explicit finding that neither party provided reliable evidence of Amex’s costs or profit margins accounting for consumers on both sides of the platform, and given evidence showing that the quality and output of credit cards across the entire industry continues to increase, plaintiffs failed to carry their burden to prove a section 1 violation. Accordingly, the court reversed and remanded. View "United States v. American Express Co." on Justia Law

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The FTC and the State filed suit seeking to hold LeadClick liable for its role in the use of deceptive websites to market weight loss products in violation of Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. 45(a)(1), and the Connecticut Unfair Trade Practices Act (CUTPA), C.G.S.A. 42‐110b(a). The FTC also filed a claim against CoreLogic, LeadClick's parent company, as a relief defendant. The district court granted summary judgment in favor of the FTC and the State. The court affirmed the district courtʹs grant of summary judgment for the FTC and the State with respect to the claims against LeadClick where LeadClick is an information content provider with respect to the content at issue and where LeadClick is liable for its own content and not merely because it was the ʺpublisher or speakerʺ of deceptive content provided by its affiliates; reversed as to the claim against CoreLogic where CoreLogic's advances to LeadClick constituted "valuable consideration" entitling it to repayment from LeadClick; and remanded with instructions to the district court to enter judgment in favor of CoreLogic. View "FTC v. LeadClick Media, LLC" on Justia Law

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A multi-district antitrust class action was brought by plaintiffs against defendants, entities incorporated under the laws of China, alleging that defendants conspired to fix the price and supply of vitamin C sold to U.S. companies on the international market in violation of Section 1 of the Sherman Act, 15 U.S.C. 1, and Sections 4 and 16 of the Clayton Act, 15 U.S.C. 4, 16. Defendants challenge the district court's denial of their initial motion to dismiss, denial of a subsequent motion for summary judgment, and, after a jury trial, an entry of judgment awarding plaintiffs $147 million in damages and enjoining defendants from engaging in future anti-competitive behavior. The court held that the district court erred in denying defendants' motion to dismiss. In this case, because the Chinese Government filed a formal statement in the district court asserting that Chinese law required defendants to set prices and reduce quantities of vitamin C sold abroad, and because defendants could not simultaneously comply with Chinese law and U.S. antitrust laws, the principles of international comity required the district court to abstain from exercising jurisdiction in this case. Accordingly, the court vacated the judgment, reversed the district court's order denying defendants' motion to dismiss, and remanded for further proceedings. View "In Re: Vitamin C Antitrust Litig." on Justia Law

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Time Warner filed suit alleging a violation of the Sherman Act, 15 U.S.C. 1 et seq., in the tying of certain premium cable television services to the leasing of ʺinteractiveʺ set‐top cable boxes. The district court dismissed two iterations of the complaint, including the Third Amended Complaint, the operative complaint for the purposes of this opinion. The court held that the Third Amended Complaint fails to adequately plead facts that, if proven, would establish that:  (i) the set‐top cable boxes and the premium programming they transmit are separate products for the purposes of antitrust law; and (ii) Time Warner possesses sufficient market power in the relevant markets to establish an illegal tie‐in. Accordingly, the court affirmed the judgment. View "In re Set-Top Cable Television Box Antitrust Litig." on Justia Law

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Cortron appealed the district court's award of damages pursuant to a jury verdict of MacDermid on its claims for violations of federal and Connecticut antitrust laws, breach of contract, misappropriation of trade secrets, spoliation, and violations of Connecticut statutes prohibiting computer crimes and unfair trade practices. At issue are the requirements for proving an adverse effect on competition for purposes of section 1 of the Sherman Act, 15 U.S.C. 1, in cases where the plaintiff has not proved that the allegedly anticompetitive behavior led to higher prices, reduced output, or lower quality in the market. The court held that a plaintiff may not prevail under the “rule of reason” merely by proving that (1) the defendant exercised “market power,” and (2) the challenged behavior may have misled consumers to believe that certain products were no longer available, without showing that consumers actually experienced reduced access to those products. In this case, the court agreed with Cortron that the district court erred in denying Cortron judgment as a matter of law with respect to MacDermid’s antitrust claims because MacDermid failed to present evidence that Cortron’s conduct harmed competition. Accordingly, the court reversed as to this claim. The court otherwise affirmed the judgment and remanded for recalculation of damages. View "MacDermid Printing Sols. LLC v. Cortron Corp." on Justia Law