Justia U.S. 8th Circuit Court of Appeals Opinion SummariesArticles Posted in Antitrust & Trade Regulation
Federal Trade Commission v. Sanford Health
The FTC and the State of North Dakota moved to enjoin Sanford Bismarck's acquisition of Mid Dakota, alleging that the merger violated section 7 of the Clayton Act. The district court determined that plaintiffs would likely succeed in showing the acquisition would substantially lessen competition in four types of physician services in the Bismarck-Mandan area. The Eighth Circuit affirmed the district court's grant of a preliminary injunction, holding that the district court did not improperly shift the ultimate burden of persuasion to defendants and properly followed the analytical framework in U.S. v. Baker Hughes, Inc., 908 F.ed 981 (D.C. Cir. 1990); the district court did not clearly err in defining the relevant market; and the district court's finding on merger-specific efficiencies was not clear error. View "Federal Trade Commission v. Sanford Health" on Justia Law
Park Irmat Drug Corp. v. Express Scripts Holding Co.
The Eighth Circuit affirmed the district court's dismissal of Irmat's complaint against Express Scripts, alleging various contract claims, a promissory estoppel claim, and violations of federal antitrust laws and state Any Willing Provider laws. The court held that the inclusion of Express Scripts's unilateral right to terminate the agreement between the parties upon thirty days written notice was, by itself, insufficient to support a claim of unconscionability; the agreement was not unconscionable because it was a non-negotiable form contract (i.e., a contract of adhesion); Express Scripts did not violate its duty of good faith and fair dealing when it terminated Irmat from its network; and the e-mail Express Scripts sent to Irmat in August 2015 did not constitute a novation where it lacked essential contractual provisions. The court also held that Irmat failed to plausibly plead promissory estoppel. Finally, the court rejected Irmat's claim that Express Scripts violated Sections 1 and 2 of the Sherman Act, and that Express Scripts violated the Any Willing Provider laws. Irmat was not entitled to leave to amend its complaint. View "Park Irmat Drug Corp. v. Express Scripts Holding Co." on Justia Law
Ortiz v. Ferrellgas Partners, L.P.
Defendants are the nation’s largest distributors of pre-filled propane exchange tanks, which come in a standard size. Before 2008, Defendants filled the tanks with 17 pounds of propane. In 2008, due to rising prices, Defendants reduced the amount in each tato 15 pounds, maintaining the same price. Plaintiffs, indirect purchasers, who bought tanks from retailers, claimed this effectively raised the price. In 2009, plaintiffs filed a class action alleging conspiracy under the Sherman Act. Plaintiffs settled with both Defendants. In 2014, the Federal Trade Commission issued a complaint against Defendants, which settled in 2015 by consent orders, for conspiring to artificially inflate tank prices. In 2014, another group of indirect purchasers (Ortiz) brought a class action against Defendants, alleging: “Despite their settlements, Defendants continued to conspire, and ... maintained their illegally agreed-upon fill levels, preserving the unlawfully inflated prices." The Ortiz suit became part of a multidistrict proceeding that included similar allegations by direct purchasers (who bought tanks directly from Defendants for resale). The Eighth Circuit reversed the dismissal of the direct-purchaser suit as time-barred, holding that each sale in a price-fixing conspiracy starts the statutory period running again. The court subsequently held that the indirect purchasers inadequately pled an injury-in-fact and lack standing to pursue an injunction to increase the fill levels of the tanks and may not seek disgorgement of profits. View "Ortiz v. Ferrellgas Partners, L.P." on Justia Law
Larson v. Ferrellgas Partners
Plaintiffs filed suit against Ferrellgas and AmeriGas under Section 1 of the Sherman Act, 15 U.S.C. 1, alleging that defendants artificially inflated prices for propane gas tanks and had conspiratorial communications about pricing and fill levels. The district court dismissed plaintiffs' claims as barred by the statute of limitations. The Eighth Circuit held that the district court erred in dismissing the claims because each sale to the plaintiffs in a price-fixing conspiracy starts the statutory period running again. In this case, the amended complaint adequately pleaded a continuing violation sufficient to restart the statute of limitations. View "Larson v. Ferrellgas Partners" on Justia Law
Posted in: Antitrust & Trade Regulation
Colella’s Super Market, Inc. v. SuperValu, Inc.
Plaintiffs, retail grocers, filed putative class actions against two large full-line wholesale grocers, alleging that the wholesalers' contract to exchange retailer supply agreements constituted market allocation in violation of the Sherman Act, 15 U.S.C. 1. Plaintiffs formed the Midwest Class and the New England Class, each class having an Arbitration Subclass of retailers who had arbitration agreements with their current (post-swap) wholesaler. The district court dismissed the purported representatives of the Arbitration Subclasses and the court reversed. At that point, the district court had rejected the proposed Midwest and New England classes and granted defendants' motion for summary judgment. The court reversed, ordering the district court to consider a narrower Midwest class. On remand, Colella moved to intervene to join Village Market, the New England Arbitration Subclass representative, in seeking to certify a narrower New England class. The district court denied the motion and announced that it would not consider any new class of New England plaintiffs. The court concluded that it does not have discretion to hear Village Market's appeal under Rule 23(f). The court explained that an order that leaves class-action status unchanged from what was determined by a prior order was not an order granting or denying class action certification. The court also concluded that the district court did not abuse its discretion by denying Colella's motion to intervene as time-barred. Accordingly, the court affirmed the judgment. View "Colella's Super Market, Inc. v. SuperValu, Inc." on Justia Law
Millennium Operations v. SuperValu
Plaintiffs, retail grocers, filed putative class actions against two large full-line wholesale grocers, alleging that the wholesalers' contract to exchange retailer supply agreements constituted market allocation in violation of the Sherman Act, 15 U.S.C. 1. Plaintiffs formed the Midwest Class and the New England Class, each class having an Arbitration Subclass of retailers who had arbitration agreements with their current (post-swap) wholesaler. Each Arbitration Subclass filed suit against only its previous wholesaler, with which it no longer had a current arbitration agreement. The district court dismissed the Arbitration Subclasses from the case. On remand, the district court rejected the wholesalers' alternate successors-in-interest theory and the wholesaler's third alternate theory that they could directly enforce their previous arbitration agreements because some of the conduct at issue occurred when the previous agreements were still in effect. The court concluded that the district court did not err by rejecting the successors-in-interest theory where the court was not aware of any authority supporting the proposition that a predecessor-in-interest bears a sufficiently close relationship to a successor-in-interest such that the predecessor-in-interest can compel arbitration under an agreement to which only the successor-in-interest is a signatory. The court rejected the direct enforcement argument, concluding that wholesalers may not directly enforce the arbitration agreements to which they are no longer signatories. Accordingly, the court affirmed the judgment. View "Millennium Operations v. SuperValu" on Justia Law
Larson v. Ferrellgas Partners
Plaintiffs appealed the district court's dismissal of their claims for damages in their action against Ferrellgas and AmeriGas under Section 1 of the Sherman Act, 15 U.S.C. 1. Plaintiffs alleged that defendants acted in concert to reduce the amount of propane contained within pre-filled propane tanks while maintaining the same price per tank, and thus artificially increasing the price of the tanks. Here, plaintiffs allege that reduction in fill levels, and thus the effective price increase, occurred in 2008, almost immediately after defendants reached the unlawful agreement. Plaintiffs have not alleged any overt acts within the four year limitations period that were new and independent acts, uncontrolled by the initial agreement. Therefore, the court concluded that plaintiffs' claims are time-barred and the court's conclusion reflects the objectives of Congress in encouraging timely lawsuits for the public good. The court affirmed the judgment. View "Larson v. Ferrellgas Partners" on Justia Law
Posted in: Antitrust & Trade Regulation
Alexander v. Fed. Trade Comm’n
In April 2014, two consumers filed a class action against BF Labs, asserting “deceptive and unconscionable business practices” in marketing and selling Bitcoin mining machines. Five months later, the Federal Trade Commission sued BF for unfair and deceptive acts, 15 U.S.C. 45(a). The court stayed pending suits and imposed a receivership. The stay was subsequently lifted. The two consumers were denied leave to intervene in the FTC action. The Eighth Circuit affirmed, agreeing that the interests of the consumers’ proposed class are subsumed within the public interest because the FTC, on behalf of consumers, sought relief for the same “deceptive and unconscionable business practices” alleged by the consumers. The consumers have not made the necessary “strong showing of inadequate representation.” View "Alexander v. Fed. Trade Comm'n" on Justia Law
Insulate SB, Inc. v. Advanced Finishing Sys., Inc.
Graco manufactures fast-set spray foam equipment (FSE) and sells it to distributors, who resell to consumers like Insulate. In 2005 and 2008 Graco purchased competing FSE manufacturers, ultimately raising its market share “to above 90%.” In 2007, Graco sent a letter to its distributors citing the “best efforts” clause in its distributor agreements, stating: It is our opinion that taking on an additional competitive product line may significantly reduce the “best efforts” of a Graco distributor.” In 2009, Foampak, a Graco distributor, considered carrying Gama products but chose not to after Graco threatened to end its distributorship. Graco sued Gama, alleging theft of trade secrets; Gama counterclaimed that Graco had unilaterally monopolized the FSE market (Sherman Act, 15 U.S.C. 2). In 2013, the FTC accused Graco of unlawfully acquiring its competitors (Clayton Act, 15 U.S.C. 18). Graco and the FTC entered a consent agreement which confirmed Graco would not engage in any practice “that has the purpose or effect of achieving Exclusivity with any Distributor.” The agreement did “not constitute an admission by [Graco] that the law ha[d] been violated.” Insulate filed suit. The Eighth Circuit affirmed dismissal on the pleadings. Insulate did not adequately plead concerted action in the existence of written anticompetitive contracts or implied exclusivity agreements. View "Insulate SB, Inc. v. Advanced Finishing Sys., Inc." on Justia Law
Robbins v. Becker,
The Robbinses provide towing and wrecker services along the I-44 corridor in eastern Missouri. State Highway Patrol (MSHP) Troops C and I, pursuant to MSHP policy, used a “rotation list” of approved towing and wrecking companies to determine which company to call to the scene of a disabled vehicle if the vehicle owner had no preference. The Robbinses were on both lists until they were removed, reportedly because Robbins had been charged with shooting at a competitor’s truck in 1999. The Robbinses alleged the criminal charge resulted from a “sham investigation” and that their competitor used a friendship with an MSHP officer, with whom Robbins had had a confrontation, to harm the Robbinses’ business. A jury acquitted Robbins, but they were never reinstated to either list. In 2005, the Robbinses sued the MSHP. The state court determined the MSHP lacked statutory authority to create a rotation list. In 2010, the Robbinses sued officers in their individual capacities, alleging due process and equal protection violations and conspiracy to violate those rights under 42 U.S.C. 1983 and violations of the Sherman Act, 15 U.S.C. 1, 2, claiming that the officers conspired to deny them work and disparaged their business. The Eighth Circuit affirmed summary judgment in favor of the officers. View "Robbins v. Becker," on Justia Law