Unilateral Refusal-To-Deal Claims: The Significance Of The Parties’ Prior Course Of Dealing

In the seminal decision, Aspen Skiing Co. v. Aspen Highlands Skiing Corp. 472 U.S. 585, 611 (1985), the U.S. Supreme Court affirmed a jury verdict for a plaintiff on a Section 2 claim and set forth the standard for unilateral refusal-to-deal claims. More recent U.S. Supreme Court and Second Circuit cases suggest that Aspen Skiing may reflect the "outer boundary" of liability under Section 2. What are the markers of that boundary? The Second Circuit has lately emphasized that whether the parties engaged in prior dealings may be the key allegation in determining whether a refusal-to-deal claim can survive a motion to dismiss. But the FTC is attempting in the Third Circuit to achieve a different result, perhaps aiming for a circuit court split and a future opportunity for Supreme Court review.

In Aspen Skiing, the plaintiff, an independent ski company, sued when its competitor refused to continue to offer an "All-Aspen" ticket that allowed customers access to mountains operated by different ski companies. Id. at 591-595. There was no dispute that the competitors had previously offered the All-Aspen ticket for a period of years and that the All-Aspen ticket was profitable for competitors. In sustaining the verdict for the plaintiff, the U.S. Supreme Court emphasized several factors, including that: (1) "the monopolist had elected to make an important change in distribution that had originated in a competitive market and had persisted for several years"; (2) the "superior quality of the All-Aspen ticket"; (3) the "adverse impact" that defendant's conduct caused the plaintiff; and (4) "most significant[ly]" that the defendant had no 'business justification' for its refusal to continue to offer the All-Aspen ticket. See id. at 603-08.

Almost twenty years later, the Supreme Court re-visited unilateral refusal-to-deal claims in Verizon Communications, Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (2004). In Trinko, the defendant entered into a consent decree with the FCC over its alleged failure to fill local exchange carriers' service orders in violation of its statutory obligations. See id. at 404. A local telephone service customer filed suit, alleging that the defendant's conduct discouraged customers from switching. See id. at 404-05. In reversing the reinstatement of the Section 2 claim, the Second Circuit characterized Aspen Skiing as a "limited exception" that is "at or near the outer boundary of § 2 liability." Id. at 409. The...