Beyer v. Acme Truck Line, Inc., 2002-1 Trade Cas. (CCH) ¶ 73,527 (La. Ct. App. 2001)

On November 14, 2001, the Louisiana Court of Appeals, Fifth Circuit, ruled that a claim alleging an conspiracy to depress the prices paid to truckers for hauling oilfield equipment, filed under Louisiana antitrust law (La. R.S. § 51;121, et seq.) and other Louisiana statutes, was pre-empted by the Federal Aviation Administration Authorization Act (49 U.S.C. §§ 14501(c) and 41713(b)). The court explained that the FAAAA pre-empted all state laws related to prices, routes, and services, and not just those that conflict with federal law. The court ruled that the truckers’ claims sufficiently involved prices, routes, and services to be barred by the FAAAA.

Cheryl Terry Enterprises, Ltd. v. City of Hartford, 2001-2 Trade Cas. (CCH) ¶ 73,364 (Conn. Super. Ct. 2001)

On February 22, 2001, the Connecticut Superior Court for the District of New London ruled that Terry Enterprises could not sue the Hartford for damages under Connecticut antitrust law (Conn. Stat. § 35-24, et seq.). The plaintiff alleged that the City was part of a conspiracy not to award a contract for the transport of school children to Terry Enterprises. The court held that although a municipality can be sued under Connecticut antitrust law, public policy dictated that a municipality could not be sued for damages but simply injunctive relief. The court explained that the purposes of the state’s antitrust law, as well as its laws governing the bidding process, would not be served if bidders could recover judgments that ultimately would be paid by the taxpayer. The court also held that Terry Enterprises had failed to document its lost profits.

Erie-Niagra Rail Steering Committee v. Surface Transportation Board, 247 F.3d 437 (2d Cir. 2001)

On April 25, 2001, the Second Circuit Court of Appeals ruled that the STB had not abused its discretion by approving the acquisition (and subsequent division) of the assets of Conrail by the CSX and Norfolk Southern railroads. The plaintiffs alleged that the terms of the transaction posed dangers to competition, including that CSX and Norfolk Southern would be able to charge unreasonable rates. The court held that the conditions that the STB had imposed on the transaction were adequate to prevent "adverse effects" on competition pursuant to 49 U.S.C. § 11324, and that the STB was not obligated to impose conditions intended to enhance competition.

Association of American Railroads v. Surface Transportation Board, 237 F.3d 676 (D.C. Cir. 2001)

On January 30, 2001, the D.C. Circuit Court of Appeals directed the STB to reconsider its decision to exclude geographic and product competition factors when the STB reviews if a railroad enjoys sufficient market dominance to permit a challenge to the reasonable of its rates. The court explained that the STB’s decision did conform with the statutory definition of market dominance (49 U.S.C. § 10709(a)). However, it further explained that the STB had not taken into account the 1980 Staggers Act (Pub. L. No. 96-448, 94. Stat. 1895). The preamble of the Staggers Act expresses a congressional preference for market-based instead of regulatory rate setting. Subsequently, the STB’s predecessor, the Interstate Commerce Commission, decided that geographic and product competition should be factored into market dominance decisions.

Continental Airlines, Inc. v. United Air Lines, Inc., 2002 U.S. App. LEXIS 637 (4th Cir. 2002); 136 F. Supp.2d 542 (E.D.Va. 2001).

On March 22, 2001, the District Court for the Eastern District of Virginia enjoined the use of sizing templates to restrict the size of the carry-on bags allowed to pass through security checkpoints at Washington Dulles Airport. The checkpoints were operated by United on behalf of a coalition of airlines. The court held that, pursuant to § 1 of the Sherman Act (15 U.S.C. § 1) and its Virginia counterpart (Va. Code § 59.1-9.5), the restriction was a per se unreasonable restraint on competition, and also imposed an unreasonable restraint on competition if evaluated under a rule of reason analysis. However, on January 15, 2002, the Fourth Circuit vacated the decision, on the grounds that the trial court had not sufficiently reviewed the competitive effects of the templates as well as the effects of the unique architectural configuration of the airport. The case has been remanded to the district court for further review.

Virgin Atlantic Airways Ltd. v. British Airways, PLC, 257 F.3d 256 (2d Cir. 2001)

On July 24, 2001, the Second Circuit ruled that Virgin Atlantic had failed to show that British Airways’ entry into incentive agreements with certain customers (i.e., travel agents and corporations) violated of § 2 of the Sherman Act (15 U.S.C. § 2). In affirming the judgment of the District Court for the Southern District of New York, the court explained that Virgin Atlantic had tried to show price predation primarily through expert economic opinion – which rested on unrealistic and unproven assumptions such as that incentive agreements caused British Airways to operate additional flights – and not on market data showing monopoly power. In addition, the court affirmed that Virgin Atlantic had failed to allege a violation of § 1 of the Sherman Act (15 U.S.C. § 1) because it had alleged only unilateral action by British Airways.

Tropical Air Flying Services, Inc., d/b/a Tropical Air Transport v. DeMelecio, 158 F. Supp.2d 177 (D.P.R. 2001)

On July 31, 2001, the District Court for Puerto Rico held that an air ambulance operator could not sue Puerto Rican government officials under § 1 of the Sherman Act (15 U.S.C. § 1). Tropical alleged that the defendants had conspired to exclude it from the market for "aeromedic health care" in Puerto Rico by refusing to contract with Tropical on the same terms as other air ambulances. The court held that, according to well-established precedent, the Sherman Act did not apply to state action, and that the government officials were therefore immune from suit.

United States v. AMR Corp., 140 F. Supp.2d 1141 (D.Kan. 2001)

On April 27, 2001, the District Court for Kansas ruled that the Department of Justice had failed to show that American Airlines had driven smaller low-cost competitors out of its hub at the Dallas-Ft. Worth airport by engaging in predatory pricing and predatory capacity conduct. American had not violated § 2 of the Sherman Act (15 U.S.C. § 2), the court explained, because it had not priced its services below an appropriate measure of cost, but had simply matched the prices of its competitors; in addition, there was no dangerous probability that American would be able to re-coup its supposed profits by subsequently engaging in supra-competitive pricing. In sum, American had engaged "only in bare, but not brass, knuckle competition." The Department of Justice has appealed the decision to the Tenth Circuit Court of Appeals.

In re European Rail Pass Antitrust Litigation, 2001-2 Trade Cas. (CCH) ¶ 73,457 (S.D.N.Y. 2001)

On September 21, 2001, the District Court for the Southern District of New York refused to dismiss a class action by travel agents against the major wholesalers of European Rail Passes. The court ruled that the plaintiffs had stated a claim under § 1 of the Sherman Act (15 U.S.C. § 1) by alleging that the wholesalers had conspired to lower commissions paid to travel agents who sold European Rail Passes, and to conceal the scheme. The court also held that because the travel agents alleged per se illegal conduct, they were not required to define the relevant product market in their claim. The court rejected the wholesalers’ argument that because the parties had an agency relationship and were not competitors, the alleged conduct fell outside the scope of per se liability and instead was governed by the more demanding rule of reason analysis.

Turicentro, S.A. v. American Airlines, Inc., 152 F. Supp.2d 829 (E.D.Pa. 2001)

On July 24, 2001, the District Court for the Eastern District of Pennsylvania held that travel agents in Latin America and the Caribbean could not sue four major U.S. airlines and the International Air Transport Association under § 1 of the Sherman Act (15 U.S.C. § 1). The plaintiffs alleged that the defendants had conspired to lower the commission rates paid to travel agents. The court held that, pursuant to the Foreign Trade Antitrust Improvement Act (15 U.S.C. § 6a), the Sherman Act did not apply to conduct affecting a foreign market unless it also had a direct, substantial, and reasonably foreseeable effect on a U.S. domestic or export market. The court held that there had been no showing that the commission rates had any effects in the U.S.