Antitrust Law Daily Wrap Up, ANTITRUST—D. Mass.: Denial of summary judgment on leveraged buyout price fixing claims will not be given interlocutory review, (Nov 25, 2013)

By Tobias J. Gillett, J.D., LL.M.

The federal district court in Boston has denied a motion for interlocutory review of its decision denying private equity firms’ motion for summary judgment on claims that they fixed the prices of companies undergoing leveraged buyouts (LBOs) (Dahl v. Bain Capital Partners, LLC, November 22, 2013, Harrington, E.).

On July 18, the court issued an order denying the defendant private equity firms’ motions for summary judgment. The court concluded that the evidence presented an issue of fact as to the existence of a conspiracy to fix the prices of certain companies undergoing LBOs, and to fix the price of Healthcare Corporation of America (HCA), one of the companies undergoing such a buyout.

Defendants TC Group III, L.P. and TC Group IV, L.P. (collectively, Carlyle) moved for interlocutory review of the court’s decision. Carlyle contended that the court had based its order on the “conclusion that the evidence created an issue of fact as to whether a tacit agreement, rather than an express agreement, existed,” that the courts disputed whether “a ‘tacit’ agreement may be inferred,” and that the First Circuit had “signal[ed] its discomfort with the idea that a ‘tacit’ agreement may be inferred merely from a request followed by uniform action” in its decision in White v. R.M. Packer Co., Inc., 635 F.3d 571 (1st Cir. 2011).

The court denied the motion. Contrary to Caryle’s contention, the court did not conclude that the evidence supported either a tacit or an express agreement. Rather, the court found “that the evidence was sufficient to raise a dispute of fact as to whether Carlyle acted pursuant to an agreement to refrain from jumping other firms’ announced deals.”

Moreover, there was “no ‘substantial dispute’ as to whether a tacit agreement may form the basis for a Sherman Act claim,” according to the court. The First Circuit in White had stated that “Section 1 by its plain terms reaches only ‘agreements’—whether tacit or explicit,” and noted that “the Supreme Court has recently reiterated that tacit agreements are still agreements under the Sherman Act.”

The case is Civil Action No. 07-12388-EFH.

Attorneys: Christopher M. Burke (Scott & Scott LLP) for Kirk Dahl. Craig S. Primis (Kirkland & Ellis LLP) for Bain Capital Partners, LLC.

Companies: TC Group III, L.P.; TC Group IV, L.P.; Bain Capital Partners, LLC

Cases: Antitrust MassachusettsNews