Antitrust Law Daily Wrap Up, ANTITRUST—D. Conn.: Expert testimony on antitrust issues, damages could not be excluded, (Jun 13, 2014)

By Greg Hammond, J.D.

A thermal flexographic processing machine manufacturer’s motion to preclude expert testimony regarding issues of antitrust and damages was denied. The federal district court in Hartford, Connecticut determined that the expert applied accepted principles of market definition and his failure to rigorously analyze the parameters of the geographic market was not a basis for excluding his testimony (MacDermid Printing Solutions, Inc. v Cortron Corp., June 12, 2014, Shea, M).

Background. In 2004, Cortron Corp. entered into an agreement with MacDermid Printing Solutions, Inc. to manufacture thermal flexographic processing machines—technology used for the creation of plates for labeling commercial packaging—designed by MacDermid. E.I. du Pont de Nemours and Company (DuPont), the first and only other company that developed and owned a thermal processing system at the time, filed suit against Cortron, alleging that Cortron’s manufacturing work with MacDermid violated one of DuPont’s patents. Cortron and DuPont subsequently entered into a settlement agreement, wherein Cortron agreed to cease manufacturing the machines and DuPont agreed to indemnify Cortron against any suit brought by MacDermid. Cortron also gave DuPont technical information regarding MacDermid’s thermal processing technology.

In 2008, MacDermid filed suit against Cortron, alleging violations of antitrust laws and Connecticut statutes prohibiting computer crimes and unfair trade practices, among others. The case was before the district court on Cortron’s motion to preclude the testimony of James A. Levinsohn, MacDermid’s expert witness on antitrust and damages issues.

Relevant geographic market. In support of its motion to preclude, Cortron first argued that Dr. Levinsohn failed to determine whether the relevant geographic market was larger than just the U.S. However, the court disagreed, noting that the pertinent facts demonstrated that it was reasonable for Levinsohn to assume the U.S. was the relevant geographic market, and nothing suggested that defining the market more broadly would affect the analysis of whether Cortron’s alleged conduct had an anti-competitive effect. Consequently, the court concluded that Levinsohn’s failure to rigorously analyze the parameters of the geographic market was not a basis for excluding his testimony.

Relevant product market. Cortron also argued that because one of MacDermid’s witnesses suggested that solvent flexographic technology is a “commercially viable substitute” for thermal flexographic technology, solvent technology should be considered part of the relevant product market. The court disagreed, noting that one or two witnesses’ views of a different product as a “commercially viable substitute” is insufficient to conclude that an expert’s narrower market definition is flawed.

In addition, Cortron argued that there was insufficient data available to support the application of the Significant and Non-transitory Increase in Price test. However, the court noted that evidence of actual anticompetitive effects may actually provide evidence of market definition and could replace the need for a rigorous definition. It determined that because there was evidence of a price decrease and loss in market share, such evidence of anticompetitive effects supported Levinsohn’s narrow market definition. Consequently, the court concluded that Levinsohn applied accepted principles of market definition and the motion to preclude his expert testimony was denied.

The case number is 3:08cv1649 (MPS).

Attorneys: Ann H. Rubin (Carmody Torrance Sandak & Hennessey, LLP) for MacDermid Printing Solutions, Inc. Craig A. Raabe (Robinson & Cole LLP) and Shawna H. Kohl (McCarter & English LLP) for Cortron Corp.

Companies: MacDermid Printing Solutions, Inc.; Cortron Corp.

Cases: Antitrust ConnecticutNews