Justia Government & Administrative Law Opinion Summaries

Articles Posted in Antitrust & Trade Regulation
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Companies that tow or recycle used cars alleged that Milwaukee and its subcontractor, engaged in anticompetitive behavior to self-allocate towing services and abandoned vehicles, a primary input in the scrap metal recycling business. They alleged that an exclusive contract the city entered into with one of the area’s largest recycling providers, Miller Compressing, violated the Sherman Act, 15 U.S.C. 1, and that the contract provided direct evidence of an agreement to restrain trade. They cited laws that require a city-issued license to tow vehicles from certain areas, that obligate towing companies to provide various notices, and that cap maximum charges imposed on vehicle owners who have illegally parked or abandoned their vehicles, as having been enacted to squeeze them out of the market.The Seventh Circuit affirmed the dismissal of the suit. The arrangement between the city and Miller is not per se unreasonable on the basis of horizontal price-fixing. The court also rejected a claim of “bid-rigging.” View "Always Towing & Recovery Inc. v. City of Milwaukee" on Justia Law

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The Second Circuit granted 1-800 Contacts' petitions for review of the FTC's final order finding that agreements between 1-800 Contacts and various competitors to, among other things, refrain from bidding on "keyword" search terms for internet advertisements, violate Section 5 of the Federal Trade Commission Act (FTC Act).The court held that, although trademark settlement agreements are not immune from antitrust scrutiny, the FTC (1) improperly considered the agreements to be "inherently suspect" and (2) incorrectly concluded that the challenged agreements are a violation of the FTC Act under the "rule of reason." In this case, where the restrictions that arise are born of typical trademark settlement agreements, the court cannot overlook the challenged agreements' procompetitive goal of promoting trademark policy. In light of the strong procompetitive justification of protecting 1-800 Contacts' trademarks, the court concluded that the challenged agreements merely regulate and perhaps thereby promote competition. Therefore, the court stated that they do not constitute a violation of the Sherman Act and thus an asserted violation of the FTC Act fails of necessity. Accordingly, the court vacated the FTC's final order and remanded to the Commission with orders to dismiss the administrative complaint. View "1-800-Contacts, Inc. v. Federal Trade Comission" on Justia Law

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Until 2016, the FAA maintained a formal “slot control” system at Newark International Airport, requiring each airline to request a “slot” for each takeoff or landing. The FAA currently announces caps on takeoffs and landings for a given scheduling season. Each airline tells the FAA what flights it wants to operate during the upcoming season. The FAA may either approve an airline’s plan or request that it make changes in order to reduce congestion. An airline is not legally barred from operating unapproved flights/In 2010, the Department of Justice (DoJ) conditioned a merger on United’s transferring 36 slots to Southwest Airlines, a low-fare carrier, new to Newark. For five years, the DoJ resisted United’s attempts to acquire more slots. In 2015 the DoJ sued United for attempted monopolization but United remained Newark's dominant carrier. In 2019 Southwest announced it would pull out of Newark; 16 of its slots were in “peak hours.” Spirit Airlines requested five. The DoJ and the Port Authority cautioned the FAA against retiring Southwest’s slots, to preserve competition.The D.C. Circuit vacated the FAA’s decision to retire the slots. The decision was final because it prevented Spirit from operating as many peak-period flights as it would otherwise have done in Summer 2020 and was arbitrary and capricious because the agency disregarded warnings about the effect of its decision on competition at Newark. View "Spirit Airlines, Inc. v. United States Department of Transportation" on Justia Law

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The Ninth Circuit affirmed the district court's dismissal, based on lack of subject matter jurisdiction, of Axon's action alleging that the FTC's administrative enforcement process violated the company's constitutional rights. In this case, the FTC investigated and filed an administrative complaint challenging Axon's acquisition of a competitor, demanding that Axon spin-off its newly acquired company and provide it with Axon's own intellectual property. The district court dismissed the complaint after determining that the FTC's statutory scheme requires Axon to raise its constitutional challenge first in the administrative proceeding.The panel held that the Supreme Court's Thunder Basin trilogy of cases mandates dismissal. The panel explained that the structure of the Federal Trade Commission Act suggests that Congress impliedly barred jurisdiction in district court and required parties to move forward first in the agency proceeding. Because the FTC statutory scheme ultimately allows Axon to present its constitutional challenges to a federal court of appeals after the administrative proceeding, the panel concluded that Axon has not suffered any cognizable harm. Therefore, the panel joined every other circuit that has addressed a similar issue in ruling that Congress impliedly stripped the district court of jurisdiction. View "Axon Enterprise, Inc. v. Federal Trade Commission" on Justia Law

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After VA Medical Center selected Metro Health's bid on the condition that Metro Health could obtain a permit from the City to operate emergency medical services (EMS) vehicles, the City refused to grant Metro Health a permit. Metro Health then filed suit against the City and RAA, alleging violations of the Sherman Antitrust Act and the Supremacy Clause of the United States Constitution.The Fourth Circuit affirmed the district court's dismissal of the case with prejudice, agreeing with the district court that defendants were entitled to immunity from federal antitrust liability where they acted pursuant to a clearly articulated state policy. Furthermore, federal law does not preempt their actions. The court rejected Metro Health's contention that by thwarting the VA Medical Center's competitive bidding process, the City and RAA have violated the Supremacy Clause. The court explained that, where, as here, a federal agency, of its own volition, imposes a contract condition consistent with federal law, the Supremacy Clause is not implicated. View "Western Star Hospital Authority, Inc. v. City of Richmond" on Justia Law

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The Fifth Circuit vacated the district court's order staying administrative proceedings that were initiated by the FTC against the Board under the Federal Trade Commission Act. The district court concluded that it lacked jurisdiction over the Board's lawsuit because the Act vests exclusive jurisdiction to review challenges to Commission proceedings in the courts of appeals.The court held that, even if the Act does not preclude the Administrative Procedure Act's default review provision, 5 U.S.C. 704,—an issue the court need not address—the Board fails to meet Section 704's jurisdictional prerequisites. The court explained that case law does not support jurisdiction based on the collateral order doctrine as applied through Section 704. In this case, the issues relevant to immunity pertain to the reach of the Sherman Act and thus a judicial decision at this point would not resolve an issue completely separate from the merits of the action. Therefore, the April 10, 2018 order does not constitute final agency action under Section 704, and the collateral order doctrine does not apply. View "Louisiana Real Estate Appraisers Board v. Federal Trade Commission" on Justia Law

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Employers Resource Management Company (“Employers”) returned to the Idaho Supreme Court in a second appeal against the Idaho Department of Commerce. In 2014, the Idaho Legislature passed the Idaho Reimbursement Incentive Act (“IRIA”). The Economic Advisory Council (“EAC”), a body created under IRIA to approve or deny tax credit applications, granted a $6.5 million tax credit to the web-based Illinois corporation Paylocity, a competitor to Employers Resource Management Company. Employers claimed Paylocity’s tax credit created an unfair economic advantage. Paylocity, however, had yet to receive the tax credit because it did not satisfy the conditions in the Tax Reimbursement Incentive agreement. Having established competitor standing in Employers Res. Mgmt. Co. v. Ronk, 405 P.3d 33 (2017), Employers argued the Idaho Reimbursement Incentive Act was unconstitutional under the separation of powers doctrine. The district court dismissed Employers’s case upon finding the Act constitutional. Finding no reversible error in that judgment, the Idaho Supreme Court affirmed. View "Employers Resource Mgmt Co v. Kealy" on Justia Law

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Oklahoma Senate Bill 608 mandated that manufacturers of the top 25 brands of liquor and wine sell their product to all licensed wholesalers. Appellees, a group of liquor and wine wholesalers, manufacturers, retail liquor stores, and consumers, challenged Senate Bill 608 as unconstitutional, contending it was in conflict with Okla. Const. art. 28A, section 2(A)(2)'s discretion given to a liquor or wine manufacturer to determine what wholesaler sells its product. The district court agreed and ruled Senate Bill 608 unconstitutional. The Oklahoma Supreme Court held SB 608 was "clearly, palpably, and plainly inconsistent" with Article 28A, section 2(A)(2)'s discretion given to a liquor or wine manufacturer to determine what wholesaler sells its product. Furthermore, the Court ruled that SB 608 was not a proper use of legislative authority as Article 28A, section 2(A)(2) was not in conflict with the Oklahoma Constitution's anticompetitive provisions. The district court, therefore, did not err by granting Distributors' Motion for Summary Judgment and ruling SB 608 unconstitutional. View "Institute For Responsible Alcohol Policy v. Oklahoma ex rel. Alcohol Beverage Laws Enforcement Comm." on Justia Law

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Saginaw County has nearly 200,000 residents. A single company, Mobile Medical, has provided the county’s ambulance services since 2009. The county guaranteed Mobile the exclusive right to operate within its borders; Mobile pledged to serve all eight of Saginaw County’s cities and incorporated villages and its 27 rural townships. In 2011, STAT, a competing ambulance company, entered the Saginaw market, providing patient-transport services for an insurer as part of a contract that covered six Michigan counties. A municipality, dissatisfied with Mobile’s response times and fees, hired STAT. When Saginaw County proposed to extend Mobilel’s contract in 2013, STAT objected, arguing that the arrangement violated state law, federal antitrust law, and the Fourteenth Amendment. The county approved Mobile's new contract and enacted an ordinance that codified the exclusivity arrangement but never enforced the ordinance. STAT continued to insist that Michigan law permitted it to offer ambulance services. Saginaw County sought a federal declaratory judgment that Michigan law authorizes the exclusive contract and that it does not violate federal antitrust laws or the U.S. Constitution by prohibiting STAT from operating in the county. The Sixth Circuit affirmed the dismissal of the claim for lack of jurisdiction. The county failed to establish an actual or imminent injury. Federal courts have the power to tell parties what the law is, not what it might be in potential enforcement actions. View "Saginaw County. v. STAT Emergency Medical Services, Inc." on Justia Law

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GandyDancer, LLC, and Rock House CGM, LLC, were business competitors, and both provided railway construction and repair services to BNSF Railway Company. BNSF awarded contracts to Rock House to provide goods and services in New Mexico. GandyDancer filed a complaint with the New Mexico Construction Industries Division (CID) in 2015 that alleged Rock House violated the Construction Industries Licensing Act (CILA), by performing unlicensed construction work in New Mexico. GandyDancer thereafter filed a complaint in district court against Rock House, alleging theories of competitive injury, and including a claim that Rock House engaged in unfair methods of competition to obtain contracts with BNSF contrary to the UPA. GandyDancer alleged Rock House’s acts amounted to an “unfair or deceptive trade practice” under Section 57-12-2(D) of the New Mexico Unfair Practices Act (UPA). The district court certified for interlocutory review whether the UPA supported supports a cause of action for competitive injury. The Court of Appeals accepted interlocutory review and held that a business may sue for competitive injury based on a plain reading of the UPA. The New Mexico Supreme Court reversed, because the Legislature excluded competitive injury from the causes of action permitted under that statute. Furthermore, the Court observed that Gandydancer relied upon dicta in Page & Wirtz Construction Co. v. Soloman, 794 P.2d 349. Therefore, the Court formally disavowed reliance on Page & Wirtz or prior New Mexico case law that conflicted with its opinion here. View "GandyDancer, LLC v. Rock House CGM, LLC" on Justia Law