Antitrust Law Daily Wrap Up, ANTITRUST NEWS: A la Carte Pricing Not on Supreme Court's Menu, (Nov 5, 2012)
Organizations Mentioned:Blecher & Collins | Fox Entertainment Group, Inc.
By Jeffrey May, J.D.
Cable television customers have been denied U.S. Supreme Court review of a decision of the U.S. Court of Appeals in San Francisco (675 F.3d 1192, 2012-1 Trade Cases ¶77,844), rejecting their tying claims against television programmers. The Court denied their petition for review on November 5 (Brantley v. NBC Universal, Inc., Dkt. 12-171).
In a putative class action, the customers had alleged that programmers, such as NBC Universal and Fox Entertainment Group, engaged in unlawful tying by selling multi-channel programming packages instead of selling each of their channels separately. The customers sought to compel programmers and distributors of television programming to sell each cable channel separately, thereby permitting plaintiffs to purchase only those channels that they wished to purchase, rather than paying for multi-channel packages.
The appellate court upheld dismissal of the action because the customers failed to allege a cognizable injury to competition, as opposed to injuries to themselves, resulting from the lack of a la carte pricing for cable programming. The plaintiffs in a rule of reason tying case had to allege an actual adverse effect on competition caused by the tying arrangement, the court explained.
In their petition for review, the customers asked whether well-pleaded allegations of industry-wide vertical restraints that generate interdependent, cartel-comparable injuries—namely, increased prices, suppressed distributor competition, and reduced consumer choice—state a Sherman Act, Sec. 1 claim sufficient to survive a motion to dismiss.
According to the petitioners, the dispute involved a “Sherman Act case of the moment for the future of television viewing in the United States.” Calling the Ninth Circuit's analysis “a confused, sometimes contradictory, and strict categorical view of vertical restraints,” the petitioners asked the Court for “much needed guidance on application of the rule of reason to industry-wide vertical restraints that give rise to the same injuries a cartel would cause.”
Maxwell M. Blecher (Blecher & Collins, PC) for petitioners.
News: Antitrust