News & Events
Skarzynski Black Wins Dismissal of Antitrust Suit
Skarzynski Black attorneys successfully obtained dismissal of an antitrust action alleging that the firm’s client had conspired with a unit of American Express to restrain trade in the sale of airline tickets. The March 16, 2015 ruling, issued by U.S. District Judge Analisa Torres of the Southern District of New York, was a complete win for our client.
March 23, 2015
In granting Skarzynski Black’s dismissal motion, Judge Torres agreed that the plaintiff had failed sufficiently to allege any relevant market for antitrust purposes. Significantly, Judge Torres dismissed the case without leave to amend the complaint, thereby ending the suit absent appeal to the Second Circuit.
The action was instituted by a travel agency which alleged that the firm’s client, also a travel agency, had conspired with Amex’s travel unit and engaged in a boycott of the plaintiff in order to control the sale of discounted business and first class airline tickets. It asserted that the conduct was in violation of Section 1 of the Sherman Antitrust Act.
Judge Torres’ ruling agreed with arguments presented by SB in concluding that the plaintiff failed to properly allege any relevant market, despite the complaint’s presentation of several different proposed markets. Specifically, Judge Torres rejected the sufficiency of markets regardless of whether based on classes of customers, on the Amex brand, or on product pricing. Judge Torres also agreed with SB’s arguments that the business relationships at issue were “vertical” (rather than horizontal as asserted by plaintiff) and that the plaintiff failed to sufficiently allege an unreasonable restraint of trade under both the per se rule and the rule of reason.
Judge Torres also acknowledged the common sense arguments – based on public information presented in the motion to dismiss – which demonstrated that the market for airline tickets is highly competitive and sellers are readily interchangeable.
Finally, Judge Torres expressly affirmed the rights of a distributor, such as Amex, to enter into exclusive dealing arrangements and to terminate distributor arrangements, where such arrangements do not reduce market-wide competition. As Judge Torres underscored, harm to an individual competitor, such as the plaintiff in this case, is not sufficient to establish a violation of the antitrust laws where nothing is changed in the relevant product market from the consumer’s perspective.
To review the decision, click here.
To learn more about this decision and its impact on your business, please contact:
Evan Shapiro, Esq.
James R. Steel, Esq.
Sarah Voutyras, Esq.