Antitrust Law Daily Wrap Up, ANTITRUST—N.D. Okla.: Claims brought by aerial spraying company against municipality dismissed, (Oct 24, 2025)

By Donielle Tigay Stutland, J.D.

The claim for breach of the original Aerial Applicator Agreement can proceed, but only against the City of Pawhuska.

The federal district court in Tulsa, Oklahoma denied most claims in a suit brought by an aerial spraying company against the City of Pawhuska, Oklahoma (“City”), the Pawhuska Municipal Airport Authority ("Airport Authority"), and the Pawhuska Municipal Airport Advisory Committee ("Advisory Committee"). Emrich Aerial Spraying LLC, an aerial agricultural spraying company, sued the City, the Airport Authority, and the Airport Advisory Committee regarding its the use of and access to the Pawhuska Municipal Airport. The court dismissed all claims against the Advisory Committee, finding that the spraying company failed to allege any facts regarding it. The court also dismissed the spraying company’s antitrust claims under the Sherman Act and Oklahoma Antitrust Reform Act against all defendants for failing to show they are competitors. The court dismissed the breach of contract claims related to the hangar lease, as it was premature against the City and the Airport Authority was not a party to the lease. The court did determine that the spraying company may proceed with its breach of contract claim regarding the Aerial Applicator Agreement, but only against the City. The court granted the spraying company leave to amend its complaint (Emrich Aerial Spraying LLC v. The City Of Pawhuska, No. 4:25-cv-00115-SH (N.D. Okla. Oct. 23, 2025)).

Background. Emrich Aerial Spraying LLC provides aerial agricultural spraying services (selling and applying fertilizers and pesticides) to farmers and ranchers in the area surrounding the Pawhuska Municipal Airport. The airport is owned by the City and operated by the Airport Authority), whose members include City Council members. The Advisory Committee provides recommendations on airport management.

In April 2019, the spraying company and the City entered into an Aerial Applicator Agreement (the "original agreement"), which permitted the spraying company to use the airport for its aerial application and crop-dusting business, including access to certain areas and water hydrants. The original agreement had a term of one year and automatically renewed for two consecutive one-year terms unless terminated with 60 days' written notice.

The spraying company alleges that beginning in April 2019, the City continuously denied it access to facilities at the airport. The City also notified the spraying company that if it wished to operate at the airport, it would need to construct a building on the property at its own expense, which the parties agreed to discuss after the end of the 2019 spraying season. In May 2020, water access was given to the spraying company, but the City sent a letter attempting to terminate the agreement, which was dated February 2020, but postmarked March 2020. The City’s attorney later confirmed that the spraying company could use the airport for 2020 but imposed additional requirements, including no water use, which the spraying company claims breached the agreement.

In fall 2021, the parties began discussions about the spraying company building a hangar at the airport. The Airport Authority approved Emrich's proposal in December 2021, but delays occurred, and on March 31, 2023, the spraying company and the City entered an Airport Hangar Lease ("lease"), requiring Emrich to build a hangar and chemical storage shed. Plans for the buildings were to be approved by the Airport Authority before commencement of construction. The spraying company alleges that in the two years between execution of the lease and the filing of its lawsuit, the City has not met its obligation to develop and describe the boundaries of the site to be leased.

The spraying company filed suit asserting claims against all defendants for violations of section 2 of the Sherman Act; the Oklahoma Antitrust Reform Act; and 42 U.S.C. § 1983. The spraying company also asserted state-law claims for breach of the original agreement; breach of the lease; and promissory estoppel.

Advisory committee. The court began its analysis by dismissing all claims against the Advisory Committee. The court found that the spraying company’s complaint did not allege any facts regarding the Advisory Committee beyond its general role.

Antitrust claims. The court next turned to the City and the Airport Authority’s contention that the spraying company failed to allege an antitrust injury or to plead a claim under section 2 of the Sherman Act. The spraying company’s antitrust claim alleged a monopoly by the City and the Airport Authority.

The court indicated that in order to state an attempted monopolization claim, the plaintiff must plead “(1) relevant market (including geographic market and relevant product market); (2) dangerous probability of success in monopolizing the relevant market; (3) specific intent to monopolize; and (4) conduct in furtherance of such an attempt.” Here, the court noted that the spraying company’s “section 2 claims require that a defendant either possesses monopoly power in the relevant market or has a dangerous probability of success in monopolizing the relevant market.” The spraying company alleges that “the relevant product market[]” is “aeronautical spraying services in the relevant geographic market.” Likewise, the alleged relevant geographic market appears to be the area accessible for spraying services via the Pawhuska Municipal Airport. The court highlighted that “here, however, there is no allegation that the City or the Airport Authority has any market share in the relevant market of aeronautical spraying services, or that either governmental entity was attempting to obtain any.” The court found that the spraying company failed to state a claim under section 2 of the Sherman Act, as it did not allege that the City or the Airport Authority were competitors in the relevant market. The court also concluded that the spraying company’s claims section 203(B) of the Oklahoma Antitrust Reform Act fail for the same reasons the Sherman Act claims.

Section 1983 claims. The spraying company also asserted claims under 42 U.S.C. § 1983, contending the defendants violated its “guaranteed rights” under 49 U.S.C. § 47107. The court concluded that section 47107 does not create statutory rights protected by § 1983. The court noted that it has been found by many other courts that § 47107 creates no right of action under § 1983 for parties harmed by an alleged violation of the “grant assurances” given to the Secretary of Transportation. The enforcement of any alleged violation would be through an administrative process overseen by the Federal Aviation Administration. The court also found that the spraying company failed to allege that the defendants violated the Equal Protection Clause of the Fourteenth Amendment.

Breach of contract claims. The court concluded that the spraying company adequately plead a breach of contract claim against the City under the original agreement. However, the court dismissed the Airport Authority from this claim, after finding the spraying company failed to show it was a party to the agreement or an alter-ego of the City. The court also dismissed the breach of contract claim related to the hangar lease, finding that it was premature. The court noted that the lease does not provide a timeline for when the City must determine the relevant site under the lease, although there is a reasonable inference that the City would need to act in time for the spraying company to be able to begin construction by March of 2026. The court found that the spraying company has not alleged that the City’s failure to act has been so delayed as to constitute a breach of the lease.

The court granted the spraying company leave to amend its complaint.

The Case is No. 4:25-cv-00115-SH.

Judge: Huntsman, S.

Attorneys: Corey Adeline Neller (Ryan Whaley Coldiron Shandy PLLC) for Emrich Aerial Spraying LLC. Michael Lee Carr (McAfee & Taft APC) for City of Pawhuska and Pawhuska Municipal Airport Authority.

Companies: Pawhuska Municipal Airport Authority

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