Antitrust Law Daily Wrap Up, ANTITRUST—E.D. Wis.: Industrial joints supplier must pay attorney’s fees for frivolous claim, (Sep 11, 2014)

By Greg Hammond, J.D.

An industrial joints supplier will be required to pay a defendant’s attorney’s fees and costs with regard to a frivolous antitrust claim, or face dismissal of the claim with prejudice. In conditionally denying the defendant’s motion to dismiss, the federal district court in Green Bay, Wisconsin determined that the defendant should not have to face an antitrust claim again, unless the expenses it was required to incur in defending the current frivolous claim are paid (Texas Ujoints LLC v. Dana Holding Corp., September 9, 2014, Griesbach, W.).

Background. Texas Ujoints LLC, an industrial joints supplier, filed suit against Dana Holding Corp., alleging—in part—that Dana improperly terminated a distribution agreement, and the company engaged in an unlawful conspiracy. In its amended complaint, Texas Ujoints asserted an antitrust claim against Dana. After Dana answered the amended complaint and moved to dismiss the antitrust claim, Texas Ujoints filed a notice of voluntary dismissal of its antitrust claim without prejudice. According to the court, Texas Ujoints conceded that it was unable to meet the pleading standard for an antitrust claim, and the company “wants to avoid a dismissal with prejudice so it will be able to reassert the antitrust claim in the event that later discovery provides the factual support that it lacks at this time.”

Conditional dismissal granted. The court treated the notice of voluntary dismissal as a motion for leave to amend, as the notice addresses only the antitrust claim, not the entire action. It determined that Texas Ujoints should never have asserted its antitrust claim when it knew it was unable to meet the pleading standard. Accordingly, the court denied Dana’s motion to dismiss, on the condition Texas Ujoints pays Dana’s costs and attorney’s fees incurred in seeking dismissal of the antitrust claim. If Texas Ujoints refuses to pay those fees, then its motion for leave to amend will be denied, and Dana’s motion to dismiss the antitrust claim with prejudice will be granted.

The case number is 13-C-1008.

Attorneys: David H. Weber (Liebmann Conway Olejniczak & Jerry SC) for Texas Ujoints LLC. Jonathan T. Smies (Godfrey & Kahn SC) for Dana Holding Corp. and Dana Ltd.

Companies: Texas Ujoints LLC; Dana Holding Corp.; Dana Ltd.

Cases: Antitrust FranchisingDistribution WisconsinNews