Antitrust Claims Based on Patent Misuse, Rather Than Patent Invalidity, Not Compulsory Counterclaims in Underlying Infringement Suit

The court denied defendants' motion to dismiss plaintiffs' antitrust claims and determined plaintiffs' claims were not compulsory counterclaims in a prior patent suit between the parties. "The Second Circuit Court of Appeals has drawn a distinction between antitrust claims that rely on misuse of a valid patent as opposed to antitrust claims based on patent invalidity. . . . [Plaintiffs'] antitrust claims do not implicate the validity of the ‘886 patent. Instead, [plaintiffs'] claims that defendants conspired to deceive the USP and relies on a theory of misuse of a valid patent. [Defendants'] insistence that the patent misuse/patent validity distinction [...]

2018-03-23T11:34:02+00:00 March 23rd, 2018|Antitrust, Docket Report|

FTC Act § 13(b) Not Subject to “Likelihood of Reoccurrence” Standard

The court granted defendant's motion to dismiss the FTC's complaint and declined to impose a likelihood of reoccurrence standard for whether a party "is about to violate" § 13(b) of the FTC Act. "The FTC cites FTC v. Evans Products Co., 775 F.2d 1084 (9th Cir. 1985) and FTC v. Accusearch Inc., 570 F.3d 1187 (10th Cir. 2009), among others. In my opinion, the FTC's reliance on those cases is misplaced. While the courts in Evans Products and Accusearch applied a likelihood of recurrence standard, they did so in deciding whether a district court had properly granted or denied injunctive [...]

2018-03-22T12:49:02+00:00 March 22nd, 2018|Antitrust, Docket Report|

Agency’s Non-Regulatory Function and Political Accountability Negate Need for Active Supervision to Receive Parker Immunity

The court granted a state agency's motion to dismiss plaintiff's Sherman § 1 claims because the agency, the Virginia Department of Medical Assistance Services (DMAS), was entitled to Parker immunity. "⁠DMAS is not subject to the active supervision requirement. The primary mission of DMAS is the provision of medical assistance services and not the regulation or licensure of members of the dental profession. Moreover, DMAS is politically accountable. It is overseen by the Secretary of Human Resources and the Director of DMAS, who is appointed by the Governor and subject to confirmation by the General Assembly. To the extent the [...]

2018-03-21T13:54:02+00:00 March 21st, 2018|Antitrust, Docket Report|

Allegation of ​Foreclosure from Distribution Channels in US and Canada Supports Claim of Antitrust Injury in Relevant Market

The court denied defendant's motion to dismiss plaintiff's Sherman Act claims and rejected the argument that plaintiff did not sufficiently assert anticompetitive harm or define the relevant market. "⁠[Plaintiff] explicitly defines the relevant market as being the market for hockey trading cards in the United States and Canada. At this point, [plaintiff] need only allege facts that, if true, make it plausible that this market is the relevant market and [defendant] has monopoly power in that market – which it has done. Further, [plaintiff] has alleged that [defendant's] conduct has foreclosed it from distribution channels, an allegation of anticompetitive harm." [...]

2018-03-20T12:24:03+00:00 March 20th, 2018|Antitrust, Docket Report|

Presence of Two Independent Actors Between Defendants’ Conduct and Plaintiffs’ Injury Defeats Finding of Direct Antitrust Standing

The court granted defendants' motion to dismiss plaintiffs' Sherman § 1 claim because plaintiffs did not allege their injury was sufficiently proximate to defendants' alleged behavior. "The Complaint alleges that Plaintiffs executed [foreign exchange (FX)] trades with non-conspiring [retail foreign exchange dealers (RFEDs)], who in turn executed covering trades with Defendants, among other counter-parties. According to the Complaint, Defendants set supracompetitive prices for their trades with the RFEDs, who passed these markups on to Plaintiffs. The Complaint fails to explain the RFEDs’ presumably independent and various pricing and execution strategies, which may well have broken the chain of causation. . [...]

2018-03-19T11:57:02+00:00 March 19th, 2018|Antitrust, Docket Report|

Indefinite Class Period Precludes Finding of Ascertainability

The court denied without prejudice plaintiffs' motion to certify a class because plaintiffs did not demonstrate the class was ascertainable under Rule 23. "Defendants contend that Plaintiffs’ class definition which describes the end date of the class period as 'until the anticompetitive conduct ceases' makes the proposed class unascertainable . . . . Plaintiffs’ liability theory is based in part on the argument that had Defendants not conspired to set the Liability Shift for October 2015, each Defendant would have set its own date for Liability Shift for a later time period because there would have been competition between Defendants. [...]

2018-03-16T11:55:02+00:00 March 16th, 2018|Antitrust, Docket Report|

Anonymity of Trading on Chicago Board Options Exchange Volatility Index Justifies Expedited 3rd Party Discovery

The court granted plaintiff's ex parte motion to begin discovery prior to the Rule 26 conference because the request was narrowly tailored. "Plaintiff . . . brings this action against Defendants, John Does, for violation of Section 1 of the Sherman Act . . . arising from their alleged participation in a conspiracy to manipulate financial instruments linked to the Chicago Board Options Exchange (CBOE) Volatility Index. . . . In 2017, a professor at the University of Texas published research concluding that 'the most natural explanation' for trading patterns certain financial instruments on the CBOE 'appears to be attempted [...]

2018-03-15T11:48:02+00:00 March 15th, 2018|Antitrust, Docket Report|

Allegation that Manipulated Benchmark Was Primary Component of Inflated Price Supports Claim of Antitrust Injury

The court partially denied defendants' motion to dismiss plaintiffs' Sherman Act claims because plaintiffs sufficiently asserted antitrust injury. "Following Gelboim v. Bank of Am. Corp., 823 F.3d 759 (2d Cir. 2016), the district courts have . . . found antitrust injury in other cases alleging manipulation of financial or commodities benchmarks. 'Courts in this Circuit consider manipulation of a price benchmark to constitute restraint of the market which that benchmark guides.' The TAC plausibly alleges that Plaintiffs were consumers in a market where competition was directly restrained and consequently suffered antitrust injury by claiming that the manipulated FX benchmark rates [...]

2018-03-14T11:43:03+00:00 March 14th, 2018|Antitrust, Docket Report|

Improper Redaction of Emails Justifies Reopening Discovery for Further Deposing of Corporate Executives

The court granted plaintiffs' motion to reopen the depositions of two defendant executives because an entity defendant improperly redacted an email chain on a claim of privilege. "⁠[The court's prior discovery order] established protocols for handling privileged documents and required the defendants to certify that every privileged document appearing on a privilege log has been reviewed by an attorney. In the following weeks, the defendants began to de-designate significant numbers of documents chosen as samples by the plaintiffs and other redacted documents, even after certifying to the court that a lawyer previously reviewed each document for privilege. The [relevant] email [...]

2018-03-13T12:04:02+00:00 March 13th, 2018|Antitrust, Docket Report|

Work-Product Protection Not Available for Common Interest Agreement Between Apple and Samsung as Third-Parties

The court granted defendant's motion to compel the production of a "Common Interest Agreement" between two third-parties, Apple and Samsung, because the agreement was not protected by the work-product doctrine. "What defeats Samsung’s work-product doctrine argument is that neither it nor Apple are parties in this case. The Ninth Circuit has specifically found that the work-product doctrine does not apply to third parties seeking to shield documents from production. . . . The Court does not reach [defendant's] burden arguments, or the question of whether the purported Common Interest Agreement is protected by the common interest doctrine, because the common [...]

2018-03-12T11:58:03+00:00 March 12th, 2018|Antitrust, Docket Report|