Chapter II Monopolization and Related Offenses
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RESTRAINTS OF TRADE
Proof of a Contract, Combination, or Conspiracy
Defining “Agreement”: Distinguishing Unilateral from Concerted
Action
In In re Pandora Media, LLC Copyright Litigation,1 the court held that
Pandora failed to allege a hub-spoke-and-rim conspiracy to fix prices
among comedians and their licensing agent, Word Communications.2
Pandora alleged that Word Communications engaged in “blanket
licensing,” requiring exclusivity from comedians and setting a single price
for all assets in its portfolio.3 Pandora further argued that individual
comedians were aware of and “necessarily” bought into the conspiracy by
affiliating with Word Collections, based on public statements by its
founder.4 The court held that Pandora failed to plausibly allege “concerted
activity that is distinct from parallel conduct” by comedians affiliating
with Word Collections.5
In BRFHH Shreveport, LLC v. Willis-Knighton Medical Center,6 the
Fifth Circuit held that the defendant’s threats to withhold donations to a
university if it did not cease dealing with plaintiff did not give rise to a
Section 1 violation and affirmed the dismissal of a plaintiff’s claim.7 The
mere fact that the university broke off dealings with the plaintiff after the
threat was made did not evidence an agreement in violation of Section 1
because the relationship between the plaintiff and university began
1. 2022 U.S. Dist. LEXIS 198694 (C.D. Cal. 2022).
2. Id. at *38-39.
3. Id. at *4-5.
4. Id.
5. Id. (quoting In re Musical Instruments & Equip. Antitrust Litig., 798 F.3d
at 1194 n.6 (9th Cir. 2015)).
7. Id. at 525.
2 2022 Annual Review of Antitrust Law Development
deteriorating, including “unambiguous efforts” to cut ties with the plaintiff
before the threat was made.8
In Hobart-Mayfield, Inc. v. National Operating Committee on
Standards for Athletic Equipment,9 the Sixth Circuit affirmed the dismissal
of a complaint alleging a conspiracy between a nonprofit developer of
safety standards for athletic equipment and helmet manufacturers based
on a press release by defendants permitting helmet manufacturers to
decertify helmets if add-on products were attached to the helmets.10 The
court held that plaintiff did not allege that the helmet manufacturers
“assented to either press release as a modification of the underlying license
agreements.”11 Because Mayfield’s argument required an inference that
the origin and motive that the press releases were “part of a larger design
created by the Defendants to restrain trade,” there was no explicit
agreement.12
Proving “Agreement”: Proof of Horizontal and Vertical Agreements
(1) Proving Horizontal Agreement in a Criminal Case
In United States v. Penn,13 the court denied five defendants’ motions
for acquittal on Sherman Act Section 1 bid rigging conspiracy charges.14
The court decided the motions after two mistrials caused by deadlocked
juries. Considering all evidence in the light most favorable to the
government, the court found sufficient evidence for a reasonable jury to
find a charged conspiracy existed and that each defendant knowingly
joined the conspiracy, knowing of its goal and intending to help
accomplish it.15 The court held that trial testimony about the existence,
knowledge, and participation, of a conspiracy to increase prices was
sufficient to support a finding that the charged conspiracy existed., and
considered each defendants’ motion for acquittal in the context of an
existing conspiracy.16 The defendants also individually argued that there
8. Id. at 528.
10. Id. at 665.
11. Id.
12. Id.
13. 2022 U.S. Dist. LEXIS 97823 (D. Colo. 2022).
14. Id. at *17.
15. Id. at *30.
16. Id. at *17-18.
Restraints of Trade 3
was insufficient evidence to sustain a conviction as to each of them.17 The
court held that direct and circumstantial evidence—when viewed as a
whole—was sufficient for a reasonable jury to convict each defendant.18
All five defendants were subsequently acquitted in a third trial.19
(2) Proving Horizontal Agreement in a Civil Case
In Value Drug Co. v. Takeda Pharm., U.S.A., Inc.,20 the court held that
the plaintiff plausibly alleged a single, horizontal conspiracy among the
defendants, but failed to plausibly plead separate, bilateral conspiracies
between defendant Takeda and each other defendant.21 The plaintiff
claimed that Takeda conspired with separate generic drug manufacurers to
stagger their entry through separate settlement agreements to deter other
generics from entering and prevent an “incremental price collapse.”22 The
agreements would not have been in each generic manufacturer’s interest
unless they all conspired which made the alleged conspiracy plausible.23
“Additional key pleaded facts” supporting the plausibility of the alleged
overarching conspiracy included a “cartel enforcement mechanism” that
allowed immediate entry by generic co-conspirators upon the occurrence
of certain market events.24 The same facts led the court to find that a
bilateral conspiracies between Takeda and each generic was not
plausible.25 Because “all three Generics had to agree here to achieve the
object of the conspiracy as pleaded,” individual conspiracies between
Takeda and each generic manufacturer were implausible.26
In In re Foreign Exchange Benchmark Antitrust Litigation,27 the court
denied both parties’ motions for summary judgment as to the existence of
an alleged sixteen-bank conspiracy to widen spreads in the foreign
exchange market.28 Notably, the court treated certain defendants’
17. Id. at *18-30.
18. Id.
19. United States v. McGuire et al, No. 1:21-cr-00246 (D. Colo. 2022).
20. 2022 U.S. Dist. LEXIS 58574 (E.D. Pa. 2022).
21. Id. at *17-18.
22. Id. at *6.
23. Id. at *6-10.
24. Id. at *11.
25. Id. at *15.
26. Id. at *17.
27. 2022 U.S. Dist. LEXIS 18083 (S.D.N.Y. 2022).
28. Id. at *55.
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