September 6, 2012 – 4:11 pm
In American Airlines Inc. v. Travelport Ltd. et al., Northern District of Texas Judge Terry R. Means ruled American Airlines Inc. claim that Sabre Holdings Corp., Travelport Ltd., and Orbitz Worldwide Inc. affiliate conspired to exclude the airline’s AA Direct Connect system from the flight booking market.
The motion to dismiss claimed that American’s allegations failed to establish a conspiracy. But the court explained that “American identifies the specific intent to monopolize allegedly shared by Sabre, Travelport, and Orbitz,” and alleges “facts that . . . support a reasonable inference of an industry-wide conspiracy [among the defendants] and other travel agencies and trade associations.”
August 31, 2012 – 1:24 pm
In In re: Blood Reagents Antitrust Litigation, Eastern District of Pennsylvania Judge Jan E. DuBois certified a class of direct purchasers in an antitrust action alleging that through a series of meetings and communications, Johnson & Johnson unit, Ortho-Clinical Diagnostics Inc., conspired with Immucor Inc. to fix prices on reagents used in blood tests. The court held that in addition to meeting the numerosity, commonality and typicality requirements, the proposed class had shown that Ortho-Clinical’s alleged misconduct had a plausible antitrust impact and that proceeding as a class was superior to doing so individually. The newly-approved litigation class includes individuals and entities that directly purchased traditional blood reagents from Immucor and Ortho-Clinical in the U.S. between January 1, 2000, and the present.
August 31, 2012 – 1:02 pm
In Clayworth v. Pfizer, California Appeals Court for the First Appellate District upheld a grant of summary judgment to more than a dozen major pharmaceutical companies and the industry group Pharmaceutical Research and Manufacturers of America. In the consolidated antitrust suit, a group of pharmacists alleged that Pfizer Inc., GlaxoSmithKline PLC, and other drugmakers violated the Cartwright Act and the California Unfair Competition Law by conspiring to inflate drug prices in theU.S. and keep lower-priced Canadian drugs off the market.
The drugmakers had won at the trial court level, when the court held that the pharmacies were not entitled to damages because they passed the higher prices on to customers. The California Supreme Court reversed the “pass-on-defense” decision, holding that under the Cartwright Act, California’s antitrust law, the pass-on defense was not available. On remand, Judge Steven A. Brick granted the drugmakers’ motion for summary judgment, finding that the pharmacies had failed to provide evidence that showed a conspiracy was “more likely than not.” The First Appellate District Court affirmed, holding that the pharmacies had failed to provide any evidence to support their claims that Canadian pharmaceuticals were consistently priced below those sold in the U.S.
The three-judge panel also shot down the pharmacies’ argument that their allegations relied on direct evidence of a conspiracy, holding that the direct evidence sought to demonstrate that the drugmakers had conspired to tie increases in their pharmaceutical prices to the Consumer Price Index, not that the they had priced their drugs lower in Canada.
August 31, 2012 – 11:25 am
In In the Matter of Cooperativa de Farmacias Puertorriquenas, the Cooperativa de Farmacias Puertorriquenas (Coopharma), a Puerto Rican pharmacy cooperative, agreed to stop negotiating prices on behalf of its more than 300 members for 10 years, as part of an antitrust settlement with the Federal Trade Commission. According to the FTC’s complaint, Coopharma, which consists of the owners of more than 350 pharmacies inPuerto Rico, collectively illegally negotiated prices for some contracts and even won single contracts to cover all of its members with pharmacy benefits managers. FTC further claimed that Coopharma had not made any effort to integrate the pharmacy services of its members, spread financial risk among them or otherwise try to enhance the efficiency of its members’ services, so there was no justification for its actions.
In order to resolve FTC’s concerns, Coopharma agreed to enter into a settlement with FTC. The settlement bars Coopharma from negotiating on behalf of pharmacies with payors, refusing to deal or threatening to refuse to deal with certain payors, or from setting the terms upon which any pharmacy works with any payors, including pricing. The deal also bans the group from helping pharmacies exchange information about contract terms and further allows payors to end their existing contracts with the group without penalty.
August 31, 2012 – 10:53 am
In TruePosition Inc. v. LM Ericsson Telephone Co. et al., Eastern District of Pennsylvania Judge Robert F. Kelly refused to dismiss an antitrust suit against Qualcomm Inc., LM Ericsson Telephone Co., and Alcate-Lucent SA. In its suit, TruePosition claims that the defendants violated antitrust laws by conspiring to use their influence within two standard-setting organizations — Third Generation Partnership Project and European Telecommunications Standards Institute — to prevent the adoption of TruePosition’s Uplink-Time Difference of Arrival positioning technology into the standards set for 4G wireless networks. Defendants moved to dismiss plaintiff’s suit for failure to state viable antitrust claims. The court denied defendants’ motion to dismiss, holding that although TruePosition failed to allege direct evidence of a purported anti-competitive agreement between the telecommunications companies, it made sufficient allegations based on circumstantial evidence of parallel conduct to keep the suit alive.
August 31, 2012 – 10:04 am
In Fromer v. Comcast Corp. et al., District of Connecticut Judge Stefan Underhill denied Comcast Corp.’s request to send a customer’s putative class action antitrust suit to arbitration, holding that under the Second Circuit’s ruling in American Express III, the waiver is void because plaintiff can show that the class action waiver in the arbitration pact would make it too costly for him to pursue his Sherman Act claims individually. In his suit, plaintiff claims that Comcast violated the Sherman Act and Connecticut’s Unfair Trace Practices law by tying the sale of its digital voice service to the rental of an embedded media terminal adapter (eMTA). In rejecting Comcast’s request to compel arbitration, the court held that the economic proof in his case would require professional services ranging in cost from $500,000 to $750,000, and if a $3 monthly eMTA charge was charged to plaintiff some 55 times, puts his damages at $495 if trebled under the Sherman Act. This means that plaintiff can expect to recover approximately $1 for every $202 spent in litigation. And according to American Express, no plaintiff could expect to recover more than $1 for every $26 spent.
August 20, 2012 – 10:38 am
In American Airlines Inc. v. Travelport Ltd., Northern District of Texas Judge Terry R. Means dismissed Travelport Ltd.’s counterclaims against American Airlines Inc., ruling that the fare data distributor lacked standing to bring the antitrust allegations because it had not suffered direct antitrust injury from the alleged behavior, in American Airlines’ suit over an alleged plot to keep it out of the airline booking business. The court held that Travelport lacked standing to bring the claims because the decrease in price competition hurts travel agents and passengers, and the strengthening of barriers of entry hurts other airlines, so the competitors in these markets are airlines, and the consumers are travel agents and passengers. Because Travelport is neither of these, its injury is indirect.
August 20, 2012 – 10:19 am
In Puerto Rico Telephone Co. Inc. v. San Juan Cable LLC d/b/a OneLink Communications, Puerto Rico District Court Judge Gustavo A. Gelpi denied San Juan Cable LLC’s motion to dismiss Puerto Rico Telephone Co. Inc.’s suit accusing the company of violating federal and Puerto Rico antitrust by filing numerous lawsuits against PRTC to prevent it from entering into the market. The court held that the complaint contains sufficient factual allegations that by delaying PRTC from entering into the market, defendant fostered an anti-competitive market, resulting in higher fees to the public, and causing plaintiffs to lose revenue. As part of its ruling, the court dismissed defendant’s contention that PRTC had failed to allege antitrust injury and that OneLink’s conduct was allowed under the Noerr-Pennington doctrine, which immunizes petitioners from antitrust liability. The court held that there is an exception to this general rule when the petition seeking redress is a sham. Such sham petitions would be found invalid should they be deemed “objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits.” According to the court, the seven separate proceedings brought by OneLink against PRTC are enough to meet this “objectively baseless” qualification.
August 20, 2012 – 9:51 am
In Gelder et al. v. CoxCom Inc. et al., Tenth Circuit denied a motion to appeal a denial of a nationwide class certification, requested by customers of Cox Communications Inc. in an antitrust suit, accusing Cox of illegally tying set-top boxes to its cable services. In their suit, the customers claimed that Cox violated the Cable Television Consumer Protection and Competition Act, and state consumer protection laws, by requiring customers to accept a set-top box to access the full range of their cable subscription without informing them that they would be charged an additional monthly fee for the box. In December, an Oklahoma District Judge denied nationwide class certification to the plaintiffs, holding that differences in the competitive landscapes of local cable markets would make it impossible to evaluate the suit’s antitrust claims on a nationwide basis. The Tenth Circuit appeals panel denied the customers’ petition to appeal the District Court’s ruling because the customers had not met the standards laid out in the Tenth Circuit’s 2009 ruling in Vallario v. Vandehey, which set the court’s guidelines for accepting an appeal of an order denying or granting class certification.
August 17, 2012 – 9:52 am
In Superior Offshore International Inc. v. Bristow Group Inc., the Third Circuit affirmed the dismissal of the plaintiff’s price fixing claims because of a lack of direct evidence of a conspiracy. The case had been related to a DOJ investigation of the off-shore helicopter transport industry, which is used to transport workers to oil rigs. But in 2010, the DOJ closed that investigation without taking action. The plaintiff alleged that the defendants, which held about 90% of the market, had jointly raised prices by 30% in 2001 and had an inter-related business culture in which employees often moved from company to company. The court found that this evidence was insufficient to permit a reasonable inference of conspiracy. The testimony of an employee witness that a conspiracy had occurred was also held insufficient because he significantly contradicted parts of his original statement in deposition.