District of Nevada Judge Robert C. Jones reversed an earlier ruling between Bally Technologies and International Gaming Technology (IGT). This new ruling effectively ends the antitrust portion of the lawsuit. The counter-claimant, Bally, alleged that the suit was part of an effort to monopolize the gaming market for certain types of machines. Bally argued that the wheel-shaped games were the relevant market, but Judge Jones found otherwise. Instead, the Judge stated that casinos chose gaming machines based on “their net revenue potential-performance” and not by their shape. Because the judge reversed the earlier ruling, IGT will be entitled to summary judgment on the antitrust portion of the litigation.
New Evidence of Price-Fixing Agreement Reopens Oil Rig Helicopter Case
January 17, 2011 – 10:37 am
District of Delaware Judge Jerome D. Davis has reopened a putative class action against some of the largest providers of offshore helicopter flights to oil rigs located in the Gulf of Mexico. Plaintiff, Superior Offshore Inc., filed an amended complaint that included new evidence of a price-fixing agreement from a confidential witness. Plaintiffs allege PHI Inc., Bristow Group, Inc., and Seacore Holdings Inc. conspired between 2001 and 2005 to raise prices by around thirty percent for transportation services. The confidential witness claimed to have heard a telephone conversation between Bristow and PHI regarding price hikes. Although the confidential testimony is hearsay, the judge concluded that ruling on the admissibility this early in the proceedings would be premature. As such, Judge Davis will allow the case to go forward with limited discovery.
DOJ Indicts Ex-Florida West Vice-President and Others for Price-Fixing in Air Transportation Industry
January 17, 2011 – 10:35 am
The Department of Justice, Antitrust Division, indicted Ex-Florida West Vice President Rodrigo Hernan Hidalgo, Luis Agusto Afanador, and Jaime Rueda Sr. in the Southern District of Flordia for conspiracy to restrain trade under the Sherman Act. The conspiracy operated in early 2002, allegedly fixing the prices of peak season fuel and security surcharges for cargo rates on air shipments between Columbia and Miami. This indictment comes from a DOJ investigation into price-fixing within the air transportation industry.
EC Levies $858 Million in Fines Against LCD Manufacturers For Cartel Activity
January 17, 2011 – 12:22 am
The Commission fined six Liquid Crystal Display (LCD) manufacturers $858 million for cartel practices in the manufacture and sale of televisions and computer monitors. According to the Commission, the companies operated the cartel for over four years, agreeing on pricing, future production planning, and capacity utilization. Also, participants held approximately 60 meetings dubbed the “crystal meetings” in hotels and took other steps such as limiting written communication to hide the existence of the cartel. The largest portion of the fine was levied against Chimei InnoLux. Samsung Electronics Co. received full immunity for providing information to the Commission.
SRAM Class Action to Proceed
January 17, 2011 – 12:21 am
Northern District of California Judge Claudia Wilken denied a motion to decertify a class of direct purchasers of SRAM chips. The judge also denied in part and granted in part defendants’ motion for summary judgment for indirect purchaser claims.
Samsung argued in its motion for decertification that the direct purchasers lacked standing because the direct buyer’s lead representative did not purchase SRAM during the damages period. Rejecting that argument, Judge Wilken held that the evidence of collusion and price fixing, which covered the entire conspiracy period, was sufficient to maintain class certification, even though plaintiffs could only quantify damages for specified sub-periods.
The judge granted defendant’s summary judgment motion against indirect purchasers in Maine and Rhode Island on claims by the lead plaintiffs but not the classes. Furthermore, the lead plaintiff of Tennessee failed to prove that he had purchased a product containing SRAM during the conspiracy period and, the court therefore decertified that class.
EC Investigates Whether Google Unfairly Promoted Its Own Services Over Its Competitors’ Services
January 17, 2011 – 12:19 am
The EU opened formal proceedings against Google to determine if it had utilized market power to push down the rank of other search and price comparison sites. The investigation was opened after the Commission received several complaints from other search providers alleging that Google was unfairly favoring its own search results. The EC will also investigate three alleged practices: (1) whether Google intended to boost its own placement, and shut-out rivals by knocking down the rank of other search providers; (2) whether Google requires “exclusivity obligations” from advertising partners; and (3) whether Google lowered the quality score of competitor’s sponsored links. Google denied the claims and stated that it would cooperate with the investigation.
Antitrust Suit Threatens Avis Budget-Dollar Thrifty Merger
January 17, 2011 – 12:18 am
Franchisees of the Dollar-Thrifty Motor Group filed an antitrust complaint filed in the Western District of Washington, alleging that the merger would violate the Clayton Act by substantially lessening competition in the car rental market. The plaintiff’s specifically claim that if Avis acquires Dollar-Thrifty then there would be an increase of market concentration in U.S. airports. The complaint alleges that the merger would increase Avis-Budget’s market share from 29% to 41% and create the largest airport car rental service in the U.S.
Third Circuit Reverses Dismissal of Insurance Conspiracy Claim
January 17, 2011 – 12:17 am
The Third Circuit reversed the dismissal of a Section 1 claim brought by West Penn Allegheny Health Systems, Inc. against the University of Pennsylvania Medical Center (UPMC). West Penn alleged that UPMC used its power in the health care provider market to protect Highmark, an insurance carrier, from competition. In exchange, the plaintiffs allege that Highmark used its power in the insurance market to protect UPMC from competition.
The appellate court rejected the lower court’s belief that judges act as the gatekeepers in overseeing antitrust suits, subjecting plaintiffs to a heightened pleading standard. Instead, the court held that Bell Atlantic v. Twombly, and Ashcroft v. Iqbal retained Rule 8’s traditional standard regardless of the complexity of the case.
Indirect Payers Fail to Vacate Summary Judgment Against Bank America and Others for Fee Fixing
January 17, 2011 – 12:16 am
Northern District of California Judge Charles Breyer denied plaintiff bank customers’ motion to vacate a judgment, upholding an earlier ruling granting summary judgment for defendants. Plaintiffs lacked standing, the court held, to sue Bank of America and others for conspiring to fix ATM charge fees. Judge Breyer explained that the indirect payers of these fees could not recover damages under Illinois Brick Co. v. Illinois, which holds that only direct purchasers may recover antitrust damages. Judge Breyer also granted the plaintiff’s motion to voluntarily withdraw their injunctive relief claim. That decision rendered the summary judgment a valid final judgment, ripening the case for Ninth Circuit review.
Vertical Price Fixing Dismissal Upheld on Appeal
January 17, 2011 – 12:14 am
The 11th Circuit upheld the dismissal of a proposed class-action against Tempur-Pedic North America Inc., ruling that the allegations did not meet the Twombly plausibility standard. The court held that the plaintiffs failed to (1) plead a relevant market; (2) sufficiently allege that unreasonable restraint of trade was created by Tempur-Pedic’s vertical resale price maintenance agreement; or (3) adequately demonstrate the plausibility of a horizontal price-fixing agreement between Tempur-Pedic and its distributors.
Judge Kenneth L. Rykstamp dissented, arguing the majority went too far in applying Twombly and essentially require plaintiffs to prove their case from the outset. Judge Rykstamp also argued that the lower court should have allowed the plaintiffs to amend their complaint because the case was filed before Twombly, and Leegin.