Antitrust Law Daily Wrap Up, ANTITRUST—7th Cir.: Petition for en banc rehearing denied in Harley-Davidson aftermarket parts practices litigation, (Oct 10, 2025)

By Justin Marcus Smith, J.D.

A majority of Seventh Circuit judges in regular active service voted to deny the petition despite the petitioner’s arguments about premature dismissal against long-standing practice.

A class action seeking an en banc rehearing of the dismissal of the Harley-Davidson aftermarket parts antitrust and warranty litigation argued the panel majority improvidently decided inherently fact-sensitive issues on a motion to dismiss. The petitioners contended the panel majority abandoned longstanding practice by substituting its own judgment about the large roadgoing American motorcycle market definition at the dismissal stage. They also contended the panel majority should not have construed warranty allegations against them, where, similarly, ambiguity in the stated warranty called for discovery about actual warranty enforcement practices. Despite these arguments, a majority of the Seventh Circuit judges nonetheless voted to deny the petition (In Re: Harley-Davidson Aftermarket Parts Marketing, Sales Practices and Antitrust Litigation, No. 24-2111 (7th Cir. Oct. 8, 2025)).

Background. In August 2025, a Seventh Circuit panel affirmed dismissal of a multidistrict class action accusing Harley Davidson Motor Company Group, LLC and Harley-Davidson Motor Company, Inc. of unlawfully conditioning motorcycle warranty coverage on the use of its Harley-Davidson aftermarket parts. The were buyers of Harley-Davidson motorcycles and aftermarket parts who brought both antitrust and warranty claims.

The majority held that Harley-Davidson’s warranty and marketing practices did not create unlawful ties or antitrust violations. Judge Lee agreed with the majority that the plaintiffs failed to state a disclosure claim under the Magnuson-Moss Warranty Act; however, he dissented by arguing that the plaintiffs plausibly alleged both a violation of the Magnuson-Moss Warranty Act’s anti-tying provision and an antitrust tying claim under state law.

Petition arguments. The petition called for rehearing en banc on the basis that the panel decision conflicted with:

1. longstanding Seventh Circuit jurisprudence that a district court should not substitute its judgment for the well-pleaded allegations of the complaint in matters of antitrust market definition; and,

2. the de novo standard of review for motions to dismiss.

Citing Judge Lee’s dissent, the petitioners argued the majority affirmed, without waiting to hear the facts, that the plaintiff-buyers’ failed to plead a proper market definition. The petitioners called this a departure from longstanding practice that would lead to substantial uncertainty. Courts are now more likely to substitute their own judgment at the dismissal stage, without evidence, in antitrust market definition matters. The petitioners offered cites to Seventh Circuit and Seventh Circuit district court cases cleaving to the Second Circuit formulation that courts hesitate to dismiss for failure to plead a relevant product market because it is such a deeply fact sensitive inquiry. See Todd v. Exxon Corp., 275 F.3d 191 (2d Cir. 2001). The petitioners argued the Supreme Court has also recognized the difficulty of resolving the scope of relevant markets without resort to the merits.

The petitioners continued that the panel majority found nothing wrong with identifying a market for large, road-going motorcycles. They only had an issue about the American national origin criterion, calling it a disfavored single-brand market, without an exploration of whether Harley-Davidson is in fact the only American brand of large, roadgoing motorcycles. In any event, the Supreme Court has long recognized the possibility of a single product market based on one brand of product.

Moreover, the petitioners emphasized that the complaint explicitly alleged there are multiple brands in the large roadgoing American motorcycle market. Therefore, the majority decision ran contrary to an express multi-product market allegation. The majority even acknowledged the Indian brand while expressing a contrasting view that Harley-Davidson was uniquely American.

The petitioners continued that the majority opinion also departed from Seventh Circuit precedent on the practical indicia for distinguishing large American roadgoing motorcycles from otherwise similar Japanese offerings. Those indicia go directly to the fundamental economic question of cross-price elasticity, but the majority ignored that the complaint pleaded the target buyer for large American roadgoing motorcycles is unlikely to substitute a foreign bike, such that foreign bikes cannot discipline Harley-Davidson pricing. The petitioners argued the complaint was clear that there is no cross-elasticity of demand for American-made motorcycles with foreign-made ones, backed up with practical indicia at odds with the panel’s substitution of its own judgment or instincts.

The petitioners continued that the majority opinion also invites district courts to construe warranties against the pleader. The petitioners said the complaint pleaded that the 2016 Harley-Davidson Owner’s Manual contained “express mandates” requiring the use of only Harley-Davidson aftermarket parts. The petitioners argued that two passages, when read together, “expressly inform[ed]” consumers that Harley-Davidson will not honor the warranty if the customer does not use Harley-Davidson parts, with additional enforcement facts pleaded.

The majority instead “focused on a different and softer formulation” found elsewhere in the manual, emphasizing the word “may,” but the petitioners argued this did not exclude actual conditioning of the Harley-Davidson warranty on use of aftermarket parts. The petitioners maintained they alleged that Harley-Davidson did in fact revoke warranties consistent with the petitioners’ interpretation. By focusing on the one more owner-friendly formulation as controlling the others, the petitioners argued the majority invited district courts to resolve contractual ambiguity on the pleadings by construing the language against the warranty holder.

The petitioners concluded the panel dissent noted an ambiguity that should have been remedied by resort to actual practice, i.e., revoked warranties. The majority therefore arguably unsettled the jurisprudence of contract, or at least of warranty construction. An implied tying violation is substantially broader than an express one and inherently a question of fact the panel majority should not have dismissed on the pleadings. As the dissent noted, the contractual ambiguity required discovery of extrinsic facts to determine party intent.

The Case is No. 24-2111.

Judge: Kirsch II. T.

Attorneys: Thomas H. Burt (Wolf Haldenstein Adler Freeman & Herz LLP) for Edward Heymer. John Mark Thomas (Dykema Gossett PLLC) for Harley-Davidson Motor Co. Group, LLC.

Companies: Harley-Davidson Motor Co. Group, LLC

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