Corporate & Securities Law

A Post-Leegin Decision From A Circuit Court

By David Fischer

We’re a bit behind on this (which I blame on having day jobs) but a couple of weeks ago, the Third Circuit applied the rule-of-reason test in a RMP case. The district court had granted summary judgment to the defendant but the Third Circuit reversed. I have yet to really analyze the opinion but this will certainly provide plaintiffs a roadmap on surviving summary judgment. Here is the decision.pdf.

In short, the plaintiff alleged a 2-part conspiracy: (1) an unwritten horizontal agreement among dealers in the form of a “gentlemen’s agreement” not to compete outside of a dealer’s “Area of Responsibility” and (2) a vertical agreement between the manufacturer, Mack Trucks, and its dealers to delay or deny “sales assistance” to any dealer attempting to make a transaction outside of its assigned Area of Responsibility. The Third Circuit held that that the plaintiff introduced sufficient evidence for a jury to find that Mack dealers entered into an unlawful conspiracy to fix prices and that Mack Trucks agreed to support that conspiracy by preventing the plaintiff from competing with those dealers. The Third Circuit held that Toledo presented sufficient evidence of “dealer pressure” and Mack’s market power to show a violation of the antitrust laws under the rule of reason.

Also, thanks to the tipster who forward the decision to us!

Full post as published by Antitrust Review on July 03, 2008 (boomark / email).