Antitrust Law Daily Wrap Up, ANTITRUST—D. Colo.: Student housing operator claiming conspiracy to monopolize denied summary judgment, (Jan 24, 2014)

By Linda O’Brien, J.D., LL.M.

The federal district court in Denver has denied summary judgment to an off-campus student housing operator on its claims against another apartment complex for conspiring to monopolize collegiate student housing at a university (Auraria Student Housing at the Regency, LLC v. Campus Village Apartments, LLC, January 22, 2014, Martinez, W.).

Auraria Student Housing at the Regency, LLC, leases and operates an apartment complex that provides off-campus housing for students attending the University of Colorado, Denver (UCD). In 2004, the UCD contacted Campus Village Apartments, LLC to construct student housing near the campus. Campus Village and UCD entered into an agreement whereby UCD would institute a residency requirement for most full-time students to live at Campus Village during the first two semesters of enrollment.

Auraria filed suit against Campus Village, alleging a conspiracy to monopolize in violation of Section 2 of the Sherman Act, among other claims. Specifically, Auraria alleged that it lost business from new students who would have chosen to live at Auraria’s apartment complex if there were no residency requirements. Subsequently, Auraria moved for summary judgment.

To establish a claim for conspiracy to monopolize, a plaintiff must show specific intent to monopolize. Auraria argued that the agreement between Campus Village and UCD effectively eliminated competition for the apartment rental business of new students who were subject to the residency requirement. Campus Village responded that its designation as UCD’s housing provider reduced the risk that UCD would switch to another student housing provider before the bonds issued to fund construction of the complex were repaid. The court found that both parties’ arguments regarding Campus Village’s motivation were plausible and, therefore, questions of fact existed as to whether Campus Village and UCD had a specific intent to exclude competition in the student housing market.

Additionally, Auraria presented no evidence that Campus Village controlled student housing prices, according to the court. Campus Village showed that even students not subject to the residency requirement chose to live at Campus Village apartments instead of Auraria’s apartment complex. The Auraria complex was located several miles from the UCD campus, while Campus Village was located adjacent to the campus. Since a reasonable jury could determine that rent at Campus Village apartments was competitive with similar student housing options, given the marked difference in distance from the campus of the two housing complexes, questions of fact existed as to whether Campus Village controlled prices in the student housing market, the court concluded.

The case is No. 10-cv-02516-WJM-KLM.

Attorneys: Thomas P. McMahon (Jones & Keller, PC) for Auraria Student Housing at the Regency, LLC. Sarah Levine Hartley (Bryan Cave, LLP) for Campus Village Apartments, LLC.

Companies: Auraria Student Housing at the Regency, LLC; Campus Village Apartments, LLC

Cases: Antitrust ColoradoNews