Sherman Act

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Antitrust claims in a class action case filed against Amazon in U.S. Federal District Court will largely proceed, after the Court allowed most of the consumers’ pricing claims to survive a motion for summary judgment.  The Court dismissed a Sherman Act claim, but allowed most other claims to proceed.  Of particular note, Amazon’s “most favored nation” (MFN) policy will continue to be under scrutiny, despite the fact that courts typically do not find MFNs to be anticompetitive.  It is widely recognized that MFNs, in fact, often serve procompetitive purposes.

The answer? Not much, in itself. If one patent is good, 132 is probably fine too. That was Judge Easterbrook’s reasoning in a recent decision addressing indirect purchasers’ antitrust challenge to AbbVie’s so-called “patent thicket” of 132 patents around the blockbuster drug Humira, arguing the sheer number of patents blocked…

If you ever noticed a coupon dispenser or colorful cardboard display while walking down the aisle of your local supermarket, there is a good chance it was put there by News Corp.’s News America Marketing (NAM) – in-store marketing’s dominant player.  News Corp.’s dominance, however, was allegedly the result of anticompetitive conduct, according to its former competitor Valassis Communications, Inc.  In a 2017 lawsuit, Valassis alleged that News Corp.’s practice of “staggering” the expiration date of exclusive contracts with retailers violated, among other things, sections 1 and 2 of the Sherman Act and section 3 of the Clayton Act, and resulted in preventing Valassis from establishing itself as a viable competitor. After four years of litigation, the case finally went to trial last month, but the parties settled after the jury indicated it would be unable to reach a verdict.  Nevertheless, Valassis’ allegations raise an interesting question: what supporting facts and allegations might suggest staggered exclusive contracts constitute anticompetitive conduct?

The Sherman Act was passed in 1890. The Clayton Act in 1914. And they have hardly changed since. Last month, Senator Amy Klobuchar, the new chair of the Senate Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights, proposed an overhaul of the antitrust laws: CLERA, the Competition and Antitrust Law Enforcement Reform Act.  If passed, CLERA would constitute the most significant change to antitrust law in a least a generation. In particular, it would also pose substantial new antitrust concerns for technology companies seeking to engage in what have been standard mergers and acquisitions.

If the September 2020 Continental Automotive Systems, Inc. opinion is any indicator, the answer seems to be “yes,” at least where an alleged violation of fair, reasonable, and nondiscriminatory (“FRAND”) terms and conditions is concerned. Following on the heels of F.T.C. v. Qualcomm Inc., the Northern District of Texas dismissed a complaint in which Continental Automotive Systems, Inc. (“Continental”) alleged, among other things, that Nokia Corporation and other technology companies (together, “Licensor Defendants”) violated Sections 1 and 2 of the Sherman Act by pooling their standard essential patents (“SEP”) in joint licensing entities called Avanci, LLC and Avanci Platform International Limited (together, “Avanci”). Continental Auto. Sys., Inc. v. Avanci, LLC

As the economy continues to globalize, so too does the reach of antitrust law. Two recent cases illustrate the interaction between international trade and U.S. antitrust law: Biocad v. F. Hoffman-La-Roche Ltd. and In re Capacitors Antitrust Litigation. These cases invoke the Foreign Trade Antitrust Improvement Act, which creates exceptions to the jurisdiction limiting language of the Sherman Antitrust Act, and exposes defendants to liability for conduct involving import and export trade or commerce. As the law evolves to keep up with changing trade and practices, the underlying principle to protect competition remains the same.

A split Eighth Circuit recently reversed a prior panel ruling and reignited antitrust claims against distributors of pre-filled propane tanks. The 5-4 majority cited the 1997 Supreme Court decision Klehr v. A.O. Smith Corp. to rule that for allegations of a price-fixing conspiracy under the Sherman Antitrust Act, each sale at an artificially inflated price restarts the statute of limitations.

Defendants in a putative class action lawsuit alleging wage fixing antitrust claims no longer need to count sheep to rest easily. A district court judge in Colorado recently denied plaintiffs’ request for leave to amend, effectively dismissing claims brought by a group of shepherds working under the H-2A Visa Program, which covers agricultural guest workers. In Llacua et al. v. Western Range Association et al. report and recommendation adopted, plaintiffs alleged that two trade associations representing sheep ranchers, and some of their members, conspired to suppress the wages paid to shepherds in violation of the Sherman Act. The Court adopted the Magistrate Judge’s ruling that plaintiffs failed to plausibly allege a conspiracy and failed to allege facts sufficient to warrant granting leave to amend their Complaint a third time, describing the Magistrate Judge’s opinion as a “masterful[] and cogent[]” analysis of the substantive allegations. Because this is one of the first judicial opinions following the DOJ and FTC’s recent announcement of an initiative to prosecute wage fixing claims, the Magistrate’s report and recommendation provides important guidance for associations and their members facing similar claims.