Antitrust Alert: Second Circuit's Expansive Application of Recent Supreme Court Antitrust Jurisprudence Eases Burden on Defendants

In recent years, in cases involving the telecommunications industry, the Supreme Court has narrowed substantially the situations where an alleged monopolist has an obligation to deal with competitors ("Trinko")1 and where allegations of parallel conduct are sufficient to state an antitrust claim ("Twombley").2 There has been considerable speculation as to how broadly the lower federal courts would apply these cases and as to whether any of these decisions would be limited to the highly regulated and complex telecommunications industry.3 On the day after Labor Day, the United States Court of Appeals for the Second Circuit provided an important partial response in a case with allegations of conspiracy and attempted monopolization involving a firm not in the telecommunications industry by affirming the dismissal of an antitrust complaint.

Plaintiffs in In re Elevator Antitrust Litigation4 represented a putative class of persons who "purchased elevators and/or elevator maintenance and repair services" from sellers of elevators and maintenance service. The complaint alleged:

price fixing;

a conspiracy to monopolize the markets for the sale and maintenance of elevators; and

an attempt to monopolize a unilateral monopolization by each defendant of the maintenance market for its own elevators by making it difficult for independent maintenance companies (and each other) to service each defendant's elevators.

The district court had dismissed the case, and the plaintiffs appealed that dismissal.

The Second Circuit rejected the plaintiffs' three distinct attempts to surmount Twombly, where the Supreme Court had required an allegation of specific facts to provide "plausible grounds to infer an agreement" and "nudge [plaintiffs'] claims across the line from conceivable to plausible."5 The court found the plaintiffs' general laundry list of participation in meetings, agreement to price fix, rigging bids, exchanging price quotes and allocating markets as "nothing more than a list of theoretical possibilities, which one could postulate without knowing any facts whatsoever."

The plaintiffs' claims of parallel conductsimilarities in contractual language, pricing and equipment designwhile more specific, fared no better. As the court stated in language that can help other defendants in the future:

Similar contract terms can reflect similar bargaining power and commercial goals (not to mention boilerplate); similar contract language can reflect the copying of...

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