In Curtis Blough v. Holland Realty, the Ninth Circuit affirmed the dismissal of a per se tying claim alleging the tying of realtor services for development to the purchase of undeveloped lots. The court held that even if a tie were shown, the plaintiffs could not prevail because there was no market for the alledged tied product and thus a substantial amount of commerce was not affected.
Title Insurance Price Fixing Cases
August 7, 2009 – 12:21 pm
A series of price fixing cases alleging that title insurers were permitted by regulators fix prices have been meeting with mixed results throughout the country. In Washington, some cases were dismissed. In Pennsylvania, the court held that under the filed rate doctrine the insurers were insulated from damages liability. But the plaintiffs claim for injunctive relief may proceed.
Former NCAA Athletes Sue for Publicity Rights
August 7, 2009 – 11:40 am
A class of former NCAA athletes has filed suit in the Northern District of California alleging that the NCAA rule requiring athletes to convey their publicity rights during their days as student athletes to the NCAA in perpetuity constitutes a concerted refusal to negotiate a revenue sharing agreement with the athletes.
Transpacific Air Travel Price Fixing MDL Initiated
August 7, 2009 – 11:18 am
Multi-district civil litigation is moving forward in the Northern District of California under the name In re: Transpacific Air Transportation Antitrust Litigation. The recently amended complaint now alleges that nearly 20 airlines participated in a conspiracy to fix transpacific prices from 2004 to 2007. The complaint is said to include extraordinary detail on the lockstep imposition of fare and fuel surcharge price increases on passenger travel.
Enforcement Agencies Continue to Challenge Patent Infringement Reverse Payments
August 1, 2009 – 12:15 pm
Update August 2009: The House Energy and Commerce Committee has approved a bill banning reverse payment settlements and granting the FTC authority to oversee settlements. Similar legislation is pending in the Senate.
The FTC and the state of California have filed suit challenging reverse payment settlements of patent disputes involving the testosterone supplement AndroGel. The case was filed in the Central District of California and alleges that three companies reached with Solvay Pharmaceuticals included unlawful agreements not to market generic versions of AndroGel until 2015. The generic manufactures sought FDA approval for generic versions of the drug in 2003 and reached the settlements in 2006.
House Sub-Committee Reports Bill to Overturn Leegin Leather
July 30, 2009 – 11:06 am
Update July 2009: The Courts and Competition Policy sub-committee of the House Judiciary Committee reported out a bill that would reverse Leegin and restore the per se rule. Although the current version had no exceptions, representatives generally supporting the measure also expressed support for limiting provisions that would permit Resale Price Maintenance in circumstances likely to be pro-competitive.
In a 2007 decision, the U.S. Supreme Court Leegin Leather v. PSKS, Inc. overturned the century old per se rule against vertical minimum price fixing, holding that all vertical claims must be evaluated under the Rule of Reason. The 5-4 decision overturned a $4 million jury verdict for the plaintiff.
On remand, PSKS, a retailer of high end women’s clothing amended the complaint to allege harm to competition. It alleged that 1) Leegin products formed a relevant sub-market in the the overall market for brand name women’s accessories, and 2) the price fixing agreement had horizontal effects because it was sought by other Leegin retailers and Leegin itself also competed at the retail level. Judge John Ward, E.D. Tex, granted Leegin’s motion to dismiss, holding that the market definition was barred by a rule prohibiting a market in a single brand and that the price fixing allegations were insufficient to establish a horizontal conspiracy and improperly went beyond the evidence presented at the earlier trial.
Ninth Circuit Rejects Monopoly Leveraging Claim
July 16, 2009 – 7:05 am
The Ninth Circuit has rejected a monopoly leveraging claim against Abbot Labs. In that claim, plaintiffs alleged that Abbot violated Section 2 of the Sherman Act by increasing the price of Norvir, an HIV booster drug on which it held a monopoly position, while leaving at competitive levels the price for Kaletra, a protease inhibitor that competes with other drugs. The Court held that the Supreme Court’s recent ruling in PacBell v. Inkline, holding that price squeezes cannot establish an independent antitrust claim where no duty to deal exists and the defendant did not price below cost, prohibited a finding of liability against Abbot which had no duty to deal and did not price Kaletra below cost. Significantly, the court also stated that the PacBell decision also cast doubt on the Circuit’s reasoning in Cascade Health, which had established a more permissive liability standard in bundled discount cases.
DOT Approves Continental Antitrust Immunity Over DOJ Objection
July 16, 2009 – 5:40 am
The Department of Justice, Antitrust Division, recommended against granting antitrust immunity to Continental Airline’s joining the Star ATI Alliance. It contended that Continental’s business arrangements with Star partners should be subject to antitrust scrutiny. Nevertheless, the Department of Transportation has exercised its authority to grant the immunity.
EC Issues Statement of Objection to LCD Suppliers
July 16, 2009 – 4:42 am
The European Commission has issued a Statement of Objections to companies active in the supply of liquid crystal display (LCD) panels. The Statement, issued in May 2009, related to potential cartel activity with respect to the main component of thin, flat monitors used for example in cell phones, TV, monitors, digital watches and calculators.
Nurse Wage Fixing Case Survives Motion to Dismiss
July 15, 2009 – 2:46 pm
Update July 2009: The court has certified a class of per diem nurses, but refused to certify a separate class of traveling nurses on the ground that their fee arrangements differed significantly more and thus common questions did not predominate.
In Jane Doe et al. v. Arizona Hospital and Healthcare Association et al., Arizona District Court Judge Susan R. Bolton denied a motion for dismissal from a class action filed by Mayo Clinic Arizona, Phoenix Children’s Hospital and Scottsdale Health Corp. The hospitals’ motion sought dismissal of a class action suit brought by nurses in Arizona who accused Arizona Hospital and Healthcare Association (AzHHA) and participating hospitals of operating a cartel and anticompetitively suppressing wages. In their complaint, filed less than two months after the U.S. Department of Justice launched a complaint against AzHHA alleging violations of federal and state antitrust laws, the nurses called the AzHHA’s registry program “an illegal and anti-competitive buyers’ cartel,” which conspired with hospitals to keep temporary nursing wages below free market levels. In denying most of defendants’ motion to dismiss, the court held that plaintiffs had standing to bring the federal antitrust claims and that the labor exemption in Arizona’s version of the Uniform State Antitrust Act doesn’t bar the plaintiffs’ claims. Judge Bolton also held that plaintiffs sufficiently established a plausible case of per se illegality by making specific allegations about the defendants’ alleged price-fixing scheme and by showing that the compensation rates set by the defendants were “below competitive levels.” Furthermore, the court rejected defendants’ “indirect purchaser” defense to the federal claims, holding that in order to determine whether the contracts fall within an exception to the indirect purchaser rule, the court would need to examine the individual contracts.