Antitrust and Unfair Competition Law

Competition: Spring 2022, Vol 32, No. 1


Edited by Malinda Lee1


  • Thomas Greene, U.S. Department of Justice, Antitrust Division
  • Colleen Huschke, San Diego District Attorney’s Office, Consumer Protection
  • Shana M. Wallace, Indiana University Maurer School of Law
  • Moderator: Malinda Lee, California Department of Justice, Office of the Attorney General


Professor Shana Wallace of Indiana University Maurer School of Law was the first of three speakers on this panel. She covered developments in substantive federal antitrust law and highlighted major Section 2, Section 1, and Section 7 cases from the past year. The highlights include cases covering refusals to deal, monopsonies and price-fixing in labor markets, and criminal no-poach actions recently brought by the government.

Thomas Greene of the U.S. Department of Justice, Antitrust Division, next covered developments in federal procedure. His case highlights covered significant developments on jurisdiction, standing, and class actions. Mr. Greene also discussed important legislative developments including the Criminal Antitrust Anti-Retaliation Act, the Competitive Health Insurance Reform Act, and a federal appellate procedure rule amendment.

Deputy Attorney Colleen Huschke of the San Diego District Attorney’s Office, Consumer Protection Unit, closed out the panel presentation by covering developments in state antitrust and unfair competition law. Her overview of legislation included changes in the area of automatic renewals in recurring service contracts and debt collection. She also covered significant unfair competition law cases that touch on damages, commercial speech, and unfiled escrow fees.


MS. LEE: Good morning, and thank you for joining us. It is my privilege to welcome you all to the 2021

[Page 10]

GSI panel on recent developments in antitrust and unfair competition law.

My name is Malinda Lee, and I’m a Deputy Attorney General in the Health Care Rights and Access Section’s Competition Unit in the California Attorney General’s Office. I have the honor of moderating this panel of esteemed speakers: Shana Wallace, Thomas Greene, and Colleen Huschke.

I will begin with introductions.

Shana Wallace is a professor at the Indiana University Maurer School of Law. She teaches antitrust, civil procedure, and legal ethics. Prior to teaching, Shana practiced both criminal and civil antitrust law for over a decade with the Antitrust Division of the United States Department of Justice. At U.S. DOJ she represented the government in an appellate capacity in civil and criminal cases, served as an advisor to the directors of criminal and civil enforcement, and investigated mergers and anticompetitive conduct with the Telecommunications and Broadband Section. In 2016 she was recognized by the Attorney General for her contributions to the Apple E-Books litigation with the Distinguished Service Award. Professor Wallace also spent time as a deputy associate counsel in the White House and as a special assistant U.S. Attorney in the Eastern District of Virginia.

Thomas Greene is a trial attorney with the Antitrust Division of the U.S. Department of Justice. His practice includes both civil and criminal enforcement actions. He was previously Special Trial Counsel for the Federal Trade Commission’s Bureau of Competition, where he led successful challenges to major health care mergers in Idaho and Illinois. Prior to the FTC, Tom served in the California Attorney General’s Office, where he was the Chief of Antitrust. During his time in the office he also served as Chief of the Public Rights Division, the public protection arm of the AG’s office, as well as the Chair of a Multistate Antitrust Task Force of the National Association of Attorneys General. He co-teaches the core antitrust course at UC Hastings and serves on the California Bar’s Justice Gap Working Group. Tom has litigated a number of landmark cases and received a number of honors, including the Antitrust Lawyer of the Year Award awarded by CLA’s Antitrust and Unfair Competition Law Section.

Colleen Huschke is a Deputy District Attorney in Consumer Protection in the San Diego District Attorney’s Office. Colleen specializes in civil enforcement of consumer protection laws. Prior to joining the San Diego DA’s office in 2016, she practiced civil litigation at Paul Hastings, where her practice focused on complex matters involving allegations of corporate wrongdoing, such as securities fraud, accounting improprieties, and failure to disclose material information.

I will now turn it over to Shana for her presentation on federal antitrust developments.


MS. WALLACE: Thank you, Malinda, and also thank you to CLA for hosting this and inviting me. In addition to those that you’ve just heard from now, I just wanted to say thank you to the organizers including Rob McNary, Victoria Loeffler, and Elizabeth Pritzker, who are making this all happen. It’s a pleasure to be back again this year.

So if you’re a member of the antitrust bar, you know that there’s just too much that’s happened this year than can be covered in our update. My approach is to try and choose some cases that I think have contributed something interesting to the antitrust literature or litigation practice this year. I will highlight a significant Section 2, Section 1 (civil and criminal), and a Section 7 merger matter, and see if there’s some sort of theme we could pick out here.

[Page 11]


I wanted to start with Comcast v. Viamedia.2 This was a case out of the Seventh Circuit.

The Seventh Circuit had reversed a district court decision, which dismissed a refusal-to-deal claim at the motion to dismiss stage, and granted summary judgment on a tying claim.

Comcast sought certiorari and after we had our GSI update last year, the Supreme Court actually issued its Call for the Views of the Solicitor General in December. That brief didn’t come in for a while—there was an administration changeover—but eventually DOJ weighed in and counseled not to grant certiorari on the basis that the Seventh Circuit’s fact-bound decision had correctly applied precedent.3 Interestingly, that precedent in large part featured Aspen Skiing,4 which has been sparingly relied upon in the lower courts after the Supreme Court, while not overruling Aspen Skiing, had indicated it should be considered "at or near the outer boundary" of Section 2.5


Before I try to connect this case up to what I think could be some potentially interesting takeaways and maybe some follow-on litigation, I want to briefly outline the facts as they’re a little bit complicated. The market actually involves competition at several levels, as described below,6 and the alleged anticompetitive conduct was effective at eliminating two of those levels of competition.

Comcast is a multichannel video programming distributor that offers cable services. Comcast also had a Division called Comcast Spotlight, which offered advertising services. First, you have some competition among Comcast and its two cable rivals in the geographic markets at issue here, RCN and WOW! Let’s use Chicago as our particular market of focus. That level of competition thus involved competition in multichannel video programming—or cable TV—market.

Second, all cable providers use ad representation ("ad rep") services to help place and distribute advertising in their programming. Comcast, as mentioned, self-provisioned that service through Comcast Spotlight. RCN and WOW!, rather than using Comcast (their cable competitor) for services to market and sell advertising, used Viamedia, an outside company that provided ad rep services. Thus there was also competition between Viamedia and Comcast in the ad rep services market.

Finally, there was also competition among the cable providers for local advertising revenue, as distinguished from national and regional advertising. A substantial portion of cable advertising is regional or national in character and is placed through "interconnects"—cooperative ventures that were jointly established by cable companies to distribute national and regional advertising, but which are now controlled by Comcast. The remaining advertising spots, however, are sold to local businesses, and the cable companies will compete with one another in their pricing and placement of local ads.

Now Comcast, as we are probably familiar, over the last 20 years or so, has acquired hundreds and hundreds of local cable companies and in so doing, has taken control of these formerly cooperative interconnects. After doing that for a while, Comcast turned to RCN and WOW! and Viamedia and basically said, "If you want access to the interconnects and to national and regional advertising revenue, then you can’t use Viamedia anymore. You have to essentially hire Comcast." RCN and WOW! held out for about a year, to a loss of millions of dollars (and Comcast lost millions of dollars in the process too), before they eventually gave in.

With Comcast now managing all of its cable competitors’ advertising, competition was affected in the following ways. First, competition for local advertising disappeared because Comcast became the only cable company marketing local advertising spots. Second, there is obviously no more competition for ad rep services with the

[Page 12]

disappearance of Viamedia. And third, competition for cable services will be lessened because Comcast now controls and manages all of its competitors’ advertising inventory, along with any competitively sensitive business information that would come with that, and the ability to profit off of its competitors’ ad sales. So those are the competitive dynamics that fed into the case.


Having a refusal-to-deal claim as part of this case was an opportunity for the Supreme Court to, if it wished, further limit Aspen Skiing or overrule it. The case was certainly well briefed. Not only did you have DOJ weighing in, but Comcast brought in Miguel Estrada of Gibson Dunn to represent it at the Supreme Court. Kellogg Hansen represented Viamedia.

Comcast’s position was that Aspen Skiing is clinging to life and it’s an artifact of an earlier era. Comcast, for example, relied on a quote by Judge Easterbrook from the Seventh Circuit at a Federalist Society conference that Aspen Skiing "bit the dust" in Trinko.7

In addition, a kind of interesting item that would also potentially have caught the Supreme Court’s eye, is that one of the decisions discussed in this case was an opinion from Justice Gorsuch when he was on the Tenth Circuit in Novell v. Microsoft,8 a late-arriving, follow-on litigation to the government’s Microsoft litigation.

And what the debate centers around is how to measure harm. So we all know about the Section 2 cases that are ongoing with Google and Facebook. In fact, there is currently decently active Section 2 litigation, which was not a feature of the antitrust landscape much in my decade-plus of practice at the Antitrust Division in U.S. DOJ. So one of the key questions is going to be: How do you measure harm?

I’d center this debate around what’s called colloquially the "no economic sense" test. It comes in part from an amicus brief that the government filed in Trinko, but it’s in large part derived from an article authored by Greg Warden, the former head career economist at the U.S. DOJ Antitrust Division who retired last year.9 The name of the test sounds very terse. It sounds like it means that if a defendant can think of any economic benefit for the alleged conduct, then it should be legal. And this was Comcast’s reading of this "no economic sense" test: there shouldn’t be any balancing test of anticompetitive harms and potential benefits. Rather, if you can think of any procompetitive benefit or an efficiency, then the activity shouldn’t be illegal.10

But the government in oral argument before the Seventh Circuit said no, it’s a balancing test. If you have actual harm that swamps any sort of alleged procompetitive benefit, then of course the harm should be noted.11 This understanding of the "no economic sense" test was further outlined in the government’s amicus brief in the Supreme Court,12 and with the Supreme Court’s denial of certiorari, discussion over the correct standard for assessing harm will certainly continue. Attorneys should be aware of this active debate: if you’re going to be making antitrust allegations of Section 2 harm, how are you going to measure that harm and then what do you do when there’s procompetitive benefits claimed against it?

Now that the Seventh Circuit opinion has been left intact, this is a really solid opinion on the books for Section 2 cases based on Aspen Skiing.



I just want to highlight what I think a few key takeaways are. You have some great distillation of Aspen Skiing factors. The Solicitor General’s brief really focuses on three factors: previous profitable course of dealing, foregoing short-term profits, and looking at comparable markets where this practice is still engaged in, when we think it’s competitive.13

[Page 13]

If you want a more granular explanation, the Viamedia court outlined how the allegations are actually the same as in Aspen Skiing. So unless Aspen Skiing is actually limited to ski mountain passes, on its facts, then the factors applied here.14


Efficiencies are questions of fact. So if they’re unsubstantiated at the motion to dismiss stage or summary judgment stage, and they are going to be disputed, an efficiencies argument just is not a good basis for tossing out the case. The case has to be tried.15


I also wanted to highlight some language that is standing somewhat alone in challenging two decades of Bork’s Antitrust Paradox16—this kind of mantra that courts just aren’t very good at this stuff and they’re just judges and it’s hard to do hard things and so they shouldn’t be finding antitrust violations around things like refusal-to-deal because they’re ill-equipped to put forward a remedy. Comcast basically made this argument in the Seventh Circuit and it had an amicus weigh in that wholeheartedly made this argument, that the court shouldn’t be finding a violation here because what are you going to do about a remedy?17 The Seventh Circuit dubbed this "the ‘So what?’ defense."18

I wanted to point out the Seventh Circuit’s response, which agreed that courts shouldn’t be thoughtless, but courts are often called upon to undertake complicated, long-term supervision of complex cases and remedies, and so they shouldn’t be adopting a posture of learned helplessness in the face of proven antitrust violations. If courts can do asbestos cases, can do bankruptcy, can oversee 115,000 individuals on very detailed, complicated supervised release provisions, maybe courts can compare interconnect prices between two different markets—especially when Comcast has told the FCC that those prices are largely the same from market to market.19

So courts are not ready to cry uncle yet. It’s nice to see some language endorsing the competency of the judiciary to weigh in if they think there’s an antitrust violation.


Another issue that may have legs is where else the Seventh Circuit pointed to for what looks like some harm alleged in this case. Obviously in the ad representation services market, competition went from two firms to one firm. Have prices gone up there? Has there been other follow-on anticompetitive effects? Who’s been harmed?

In the market for cable competition, we have Comcast’s conduct at issue in Viamedia; and if this is going on in other markets with the dominant cable provider potentially using interconnects to corral their cable providers, has there been some sort of harm in that market that might be a problem?20

The opinion also points to the local advertising market. Now for any market in which an incumbent cable provider or dominant cable provider has taken control of the interconnects, if they have taken over all of the local advertising spot inventory for all of their competitors, is that a problem?21

Finally, the opinion casts a skeptical eye on the interconnects. Those cooperative ventures had always been jointly operated by all the cable companies in specific geographic areas, in which the cable companies pooled ad inventory and agreed on a set fixed price. That joint price-setting activity—when operated to the benefit of all participating cable companies in an effort to compete for advertising dollars against broadcast television and satellite service looked very much like the legal, cooperative efforts described in BMI/ASCAP.22 The Seventh Circuit pointed out, however, that if Comcast is now saying that their control over the cooperative interconnects is actually the source of its competitive advantage, that would

[Page 14]

seem to call into question the legality of the interconnects themselves.23

The case was remanded back to the district court, where Viamedia asked for a protective order, saying they don’t need any more discovery. That issue was briefed back in October of last year, and is still hanging out there. So Viamedia filed a notice in November 2021, explaining that there have been a few more depositions and they have been struggling to survive since the anticompetitive conduct. Viamedia sought a ruling on these discovery motions in order to proceed to trial.24

So despite favorable legal rulings for Viamedia, when looking at the facts on the ground, it’s not clear that the remedy will be useful.



If we move on to Section 1, I think everyone’s familiar with the NCAA/Alston case.25 This case comes out of Judge Wilken’s courtroom in the Northern District of California, who previously heard the O’Bannon26 matter. What was teed up for the Supreme Court in Alston were NCAA rules limiting education-related benefits for student athletes; the Court expressly did not address rules limiting other compensation for athletic performance, as the student-athletes had not challenged the district court’s judgment on that issue.27

I want to first focus on Justice Gorsuch’s opinion. The NCAA made "amateurism" the centerpiece of its defense. But Justice Gorsuch set the scene by pointing out in great detail the billions of dollars that flow through NCAA and NCAA-sanctioned activities, which makes the entity seem very non-amateur.28 The resulting opinion ends up being a pretty straightforward rule-of-reason case focusing on the monopsony power that the NCAA exercises in this market and the resulting, significant anticompetitive effects, with a marked lack of procompetitive justifications. Not only does Justice Gorsuch criticize the NCAA for failing to define what it means by "amateurism" in a market worth billions of dollars, but the NCAA failed to engage with very basic economic observations that it is difficult to reconcile the argument that "amateurism" is what makes the NCAA’s product attractive to consumers with the fact that consumer demand for college sports has increased even as student-athletes have gained additional sources of income.29

I also note Justice Kavanaugh’s concurrence as the one that drops a bomb on everything, pointing out that price-fixing labor by incorporating price-fixed labor into the definition of a product market isn’t necessarily going to work for litigation going forward. A monopsony can’t launder its price-fixing of labor by calling it a product definition.30

We also have House v. NCAA31 pending in front of Judge Wilken. Now NCAA players are talking about being compensated for their appearance in television broadcasts. We know the name, image, and likeness rule was suspended, so this case explores that area. There’s other movement over whether or not athletes should be treated or be able to claim Fair Labor Standards Act and state wage law violations as employees.32 So clearly this will continue to be an active area.


The major Section 1 criminal cases this past year are no-poach matters. Just a reminder that back in 2011, the government had a consent decree with a tech company that it was a civil per se violation to agree not to compete for each other’s employees (an exercise of monopsony power over the labor market)—dubbed a "no-poach agreement."33 Fast forward to 2016 and we see U.S. DOJ’s Human Resources Guidance come out that states U.S. DOJ will now proceed criminally against naked wage-fixing or no-poach agreements.34 The development in this area after this 2016 announcement came after last year’s update.

[Page 15]

For several years, the Assistant Attorney General for Antitrust, Makan Delrahim, promised that the Division would be charging "no-poach" cases criminally.35 There are now finally a couple of active matters going on.

The case I want to highlight came out of Texas, where the indictment was filed on January 5, 2021 in United States v. Surgical Care Affiliates.36 So it was a very active last day in the office for the previous Assistant Attorney General. A motion to dismiss has been briefed, and one of the people briefing it is Paul Clement. And one argument that I wanted to focus on before we leave no-poach is in a footnote in the defendants’ motion to dismiss. Surgical Care Affiliates argues that it’s problematic that through U.S. DOJ Human Resources Guidance, the DOJ has decided to criminally prosecute these types of arrangements, and they reserve the right to dispute that the per se approach to criminal liability is appropriate at all.37

This argument echoes the Sanchez38 petition for certiorari that had been filed with the Supreme Court about a year ago, for which the Court issued a Call for the Views of the Solicitor General regarding the challenge to the constitutionality of the per se approach to criminal antitrust.


Finally, I’ll note that in the recent merger enforcement action against Penguin Random House and Simon & Schuster,39 the action is based on a theory of monopsony power. And I would just reflect back that when I started my practice, Weyerhaeuser40 was on deck and the monopsony theory was something that was novel and rare. The theory seems to be all over the place these days, and all of this takes place against the backdrop of a lot of political ferment around antitrust and whether or not antitrust has been doing what it’s supposed to have been doing over the last 30, 40 years.

The existence of a lot of viable monopsony cases and the fact that the level of concentration in our markets is such that everywhere we look we see monopsonies, may be one large macro indicator that maybe antitrust law has not done what it needed to do all along.

MS. LEE: Thank you, Shana, for giving us that great overview and incisive analysis.

We will now turn things over to Tom for developments in federal procedure.


MR. GREENE: Great. Thanks, Shana. Just a very interesting presentation and thank you very much, Malinda, for that lovely introduction.

I’m going to be looking at federal civil procedure this morning and the thing that really struck me as I’ve prepared this year’s materials was how basic some of the developments are that we’re going to be talking about this morning. So I think that you, like me, may be shocked at how significant some of these cases actually are.

Let me do the usual disclaimer here. Anything I say is my presentation, doesn’t represent the views of the Antitrust Division or the U.S. Department of Justice.

Also an additional personal disclaimer: the presentation is a highly curated set of cases, it’s not everything, so don’t rely upon this as a complete download, in terms of significant procedural developments.


Let’s turn now to jurisdiction. This will be the first major piece for us; let me just remind you of recent activities in this space. The Roberts court has really made a meal out of jurisdiction over the last few years. The current state of play with respect to jurisdiction is that there’s a distinction—and quite

[Page 16]

a sharp distinction—between general jurisdiction and specific jurisdiction. General jurisdiction exists because the defendant either is incorporated in a particular forum or because its principal place of business, generally the headquarters, is located in the forum state. If general jurisdiction applies, you can bring any case that relates to that company in that forum.

The more common form of jurisdiction is special jurisdiction, which requires that something happened—generally an injury—within the state forum, plus some evidence of purposeful availment. On this second element, it can’t be just an odd random incursion of the corporation into that jurisdiction, but if the corporation has some basic availment activities, such as seeking sales and profits in the forum state, that is enough.

In 2017, special jurisdiction in the Bristol-Myers Squibb case41 was narrowed to a pinpoint. This case involved Plavix and cases addressing injuries arising from the use of this drug. All in all, this was a bad drug case. Bristol-Myers Squibb had done tens of millions of dollars of business within California. They had a research center in California. They still do. The California Supreme Court said that because of all that activity, jurisdiction in California was proper.

The United States Supreme Court said full stop, not true. The lower court’s decision violates our emerging jurisprudence, in terms of special jurisdiction. In light of the fact that the plaintiff class did not include persons who took the drug or were injured within the state of California, there was no jurisdiction because defendant’s activities did not give rise to the plaintiffs’ injuries. This is a specific formula that flows out of Bristol-Myers.

So that brings us to Ford Motor Company.42 Ford is looking at Bristol-Myers and says, this gives rise to an interesting opportunity for us, and on its face that may have been true. Specifically, they sold cars, they repaired cars, they brought parts in the forum states, things of that nature, resulting in millions and millions of dollars of revenues for Ford. But, Ford asserted, the cars were purchased outside the forum states so there was no jurisdiction, notwithstanding the company’s substantial activity within each state.

The majority, with Justice Kagan writing, said, look, we’re getting a little carried away with the specific linguistic formula that existed in Bristol-Myers. The majority turns to the Court’s older jurisprudence where special jurisdiction exists if the activities of the defendant arise out of something they did specifically in the jurisdiction or related to it. The "or relate to" clause is the one that Kagan relies on to establish jurisdiction for the injured plaintiffs in Montana and Minnesota. The Court also says one of the implications of this test is that multiple states may have jurisdiction over various parts of the corporation.

So this is a very big change-up, and actually provides a little glimmer of light for plaintiffs after a long dry spell of jurisdictional cases.

The majority opinion generates a very strong reaction from the conservative side of the Court. They treat this "relating to" standard like some version of the Return of the Jedi jurisdictionally. Justice Alito says that the "relating to" standard may be unnecessarily broad. Justice Gorsuch, joined by Justice Thomas, argues that the "relating to" formulation is broad and can be used to significantly expand the jurisdiction of state courts.

Watch this space. "Related to" could be relatively narrow, or could, as suggested by the concurring opinions, be quite broad. If you’re on the plaintiff’s side, you’ll want to focus on cases that might help define (or expand) this decision. If you’re on the defense side, this is something you need to watch.


Obviously, Spokeo43 has been a key case for members of the section who do privacy stuff. This is not news. This is an important area. This case is TransUnion v. Ramirez.44 This case was brought

[Page 17]

under the Fair Credit Reporting Act, and the facts are actually very strong.

TransUnion is a credit agency, so it issues reports on people’s creditworthiness. It provided all the classic creditworthiness services generally offered by these kinds of companies. However, it added a new feature, which cross-linked its credit service to the terrorism no-fly list. Essentially this is a list created by the federal government of people that are potentially dangerous.

TransUnion linked to the no-fly list based on matches and near matches to first and last names. For example, Joe Smith would be a match if your name was Joe Smith. Joseph Smythe might be a match or J. Smithe, with an "E" on the end. This was a very simplistic method of matching, with no additional features such as Social Security numbers or other identifiers of that nature. As a result, there was an accident waiting to happen.

This accidental "match" did happen to Mr. Ramirez, the main plaintiff in a class action. Mr. Ramirez went to a car dealership in Dublin, California, which is a few miles from where we’re talking in San Francisco. He goes to a Nissan dealer, picks out a car, picks out the color, and then he and his wife go into the office to discuss a loan for the car. The dealer taps in Mr. Ramirez’s name and information into the TransUnion database and then he looks up at Mr. Ramirez and says: "We can’t sell you a car because you’re a terrorist, sir."

The car is actually purchased by Mr. Ramirez’s wife because her husband is now labeled as a terrorist. He sues on behalf of himself and a similarly situated class. The jury here in California awards $60 million.

The thing to know about the Fair Credit Reporting Act45 is that this is a kind of citizen suit law in the sense that private people can recover actual damages, but if you can’t demonstrate that, you get statutory damages. So this statute is a lot like a lot of other citizen suit statutes you see in consumer protection, environmental protection, and other areas of the law.

Justice Kavanaugh writing the majority opinion picks language out of Spokeo and says, Article III requires concrete injury in a great stentorian statement about the beauty and wonder of Article III. Mr. Ramirez was injured and nobody else was injured—which is one point.

Concreteness, this idea that you were injured within the meaning of Article III, is keyed to traditional legal harms. So you open up Blackstone on Common Law or some older volume like that, and that’s how you sort out whether concreteness has been established.

There is a significant poke in the eye to the Congress of the United States. The court makes it clear—Justice Kavanaugh is quite crisp—that Congress can’t overcome this situation and can’t define new kinds of injuries if the injury doesn’t meet the Court’s backward-looking concrete injury standard.

This yields two very strong dissents. Justice Thomas in his dissent rejects the majority’s assertion that Article III requires rejection of statutory claims. He states, "the Constitution does no such thing," full stop.46 He then goes through a very long, historical analysis, starting with a copyright case that was filed and accepted by federal courts in the first Congress, which, according to Justice Thomas, was exactly the kind of citizen suit that was rejected by Justice Kavanaugh here.

Interestingly, for those of us that practice in both state courts and federal courts, Justice Thomas says, look, this actually creates a really interesting backfire—which he described as a pyrrhic, potential victory for TransUnion—now that federal courts have no jurisdiction because there’s no standing. The only place plaintiffs can go then is state courts, and because there’s no jurisdiction, the case can’t be removed to federal district court.

[Page 18]

So there’s this really interesting vice that’s being created by this statute. If you deal in these kind of spaces, you need to know about TransUnion v. Ramirez.

Justice Kagan also writes a thoughtful dissent. In terms of the poke in the eye to the Congress, Justice Kagan concludes her opinion by saying simply that Congress is better suited than courts to determine when something causes a harm or risk of harm in the real world. For that reason, courts should give deference to those congressional decisions.

Justice Kagan rebuffs, in this elegant way, the majority’s rejection of Congress. We’ll have to see how this all turns out, but your time would be well-spent to take a look at this particular case.


I’ve got three class action cases that I’d like to cover.

Bristol-Myers will be a major theme today. This first is a class action arising from unwanted sales calls, allegedly in violation of the Telephone Consumer Protection Act.47 The question procedurally is how do you challenge the fact that the class may include people over which the state court has no jurisdiction because of Bristol-Myers? There are a couple of choices here.

Federal Rule of Civil Procedure 12(h) covers how you challenge jurisdictional questions, and the kicker is that a challenge has to be done early in the litigation process or you waive it. The trial court told the defendant that while its argument was interesting, it should have been made at the beginning of the case under Rule 12(h). The question for the Ninth Circuit panel, with a relatively new Trump-appointed judge writing the opinion, is to what extent can you use Rule 23(f), which is the way you appeal class certification issues to an appellate court, to raise such issues. The court basically concludes that use of Rule 23 is proper for this purpose. A dissent by Texas District Court Judge Cardone rejects this conclusion because this is contrary to the explicit text of Rule 12.

If you get into this kind of a situation, this discussion of how you deal with jurisdictional issues, when and under what provision, will be a big deal to you.

So there are two additional cases worth noting because of their potential significance. One major caveat, both cases may be vacated but I nonetheless want to bring these to your attention.

Olean is a class action that arose from the facts generated by a series of prosecutions in the San Francisco Field Office of the Antitrust Division.48 Tuna canners in the United States had engaged in a long-term price-fixing agreement and Olean was the follow-on damages case. The issue was predominance.

The experts for the parties came up with different conclusions about the percentage of people who were not injured. The plaintiffs’ experts concluded that four percent were uninjured while the defense experts concluded that 28 percent were uninjured.

The majority approves the basic statistical analysis of the plaintiffs’ expert; however, it remands to the district court to resolve this fairly significant difference between the number of uninjured people from the plaintiffs’ assessment versus the defense’s assessment.

But then the kicker—and this is why this may be a very significant decision—appears to adopt with approval a D.C. Circuit case in which predominance can basically be defeated if more than a de minimis number of class members are uninjured.

The court says four to six percent of uninjured folks in your class is okay, that’s de minimis. However, if the number is 28 percent, that is too much and the class cannot be certified.

This draws a very strong dissent from Judge Hurwitz and he says very straightforwardly, quote,

[Page 19]

"Our case law squarely forecloses the majority’s approach."49 Citing longstanding Ninth Circuit law and general class action law, Judge Hurwitz says the crucial issue of predominance, "is whether the District Court can economically winnow out uninjured plaintiffs to ensure they cannot recover for injuries they did not suffer."50 Typically this is done in the remedies phase when consumers may file their forms to get damages out of the class and the like.

So this is a dramatic confrontation, with very different ideas about the idea of predominance.

The majority opinion has been vacated and a rehearing en banc has been ordered. So this is a space I think we all need to watch because of the potential change in class action law the majority opinion represents.

The next case is another one which is interesting, regarding arbitration.

So the system that we operate under right now is that if you sign an arbitration agreement, you’re bound by it. Most of the time there is a big exception based on California’s Unfair Competition Law ("UCL"). The California Supreme Court’s decision in McGill51 calls out a public injunction for relief exception to this rule. McGill relied on a specific Civil Code provision.52

Relying on McGill, the Ninth Circuit, in Rent-A-Center53 said that that public injunctions are not preempted by the Federal Arbitration Act,54 so you can go ahead with your class action.

In this appeal, the relief proposed focused on people who were Comcast customers. It was undisputed that roughly two million Comcast customers in the state of California, or roughly 40 percent of all cable customers. But the majority here says that since the relief went primarily to the people who were Comcast customers, that was private, it’s not within the confines of either McGill or Rent-A-Center.

Judge Berzon says, wait, time out. This is exactly the kind of relief that the California Supreme Court authorized in McGill and that we, the Ninth Circuit, approved in Rent-A-Center.

The Ninth Circuit has ordered Comcast to respond to plaintiffs’ petition. That’s the step before they order rehearing en banc. We’ll have to see how this turns out but this, again, is another potential sea change case, in terms of class actions in California.

Very briefly, there are a couple of interesting federal pieces of legislation, indeed long overdue, enacted since last year.

In the Criminal Antitrust Anti-Retaliation Act,55 employees of companies will enjoy whistleblower protection if they bring information about criminal antitrust violations—a defined term in the Act—to the attention of their own managements or if they bring it to the government. This is something that probably should have been done years ago, and is now in effect. Be aware of it.

The other legislation is The Competitive Health Insurance Reform Act.56 McCarran-Ferguson is now limited, in terms of how it applies to health care insurers. So if you counsel health care entities, this is something you need to be aware of or if you’re suing health care entities, particularly insurers, this is something that should be first on your reading list.

And finally, Federal Rule of Appellate Procedure 3 is adjusted to deal with traps for the unwary. If you are on the cusp of filing an appeal, you need to look at this because this is a big change in the rules. The amendment just makes it easier to notice an appeal, but you do need to be aware of it.

So Malinda, back to you. Thanks.

MS. LEE: Thank you so much, Tom, for that great summary. I will now turn it over to Colleen for the update on state law developments.

[Page 20]


Panelist Colleen Huschke’s Presentation on Developments in State Antitrust Law and Procedure

MS. HUSCHKE: Thank you very much.

As with the other presenters, I am issuing the normal disclaimers in that I personally have decided what to present and my views don’t reflect that of my office.

There’s obviously a lot of issues going on at the state level when it comes to unfair competition and antitrust law.

I wanted to start out talking about some new pieces of legislation which will be coming into effect in 2022. I will review the legislation through the prism of consumer protection, but also civil law enforcement.


So the first piece of legislation is the amendment to California’s automatic renewal law.57 As many of you are aware, California has an automatic renewal law which states that if a contract is going to automatically renew for a certain period of time, say a three-month or six-month subscription, the consumer must receive clear, conspicuous disclosures of the terms of the agreement and must affirmatively consent to that agreement. The law also imposes certain ease of cancellation requirements.

The amendments to that statute fill in some gaps to the original law, thereby strengthening the automatic renewal law. There are now notice requirements for trial products that go 31 days or longer, as well as contracts that last one year or longer. There are also requirements that the notice, before the automatic renewal takes place, must contain some clear and conspicuous disclosures as well. It’s important that you take a look at the statute to understand all of the details there.

The statute also strengthens the ease of cancellation. In the amendments, the consumer must be able to terminate the automatic renewal exclusively online, at-will, without engaging in any further steps that obstruct or delay the consumer’s ability to terminate immediately. So it’s really emphasizing again the ease of termination, no use of dark patterns or obstructions for the consumer to be able to terminate an automatically renewing contract. There are two methods specified in the amendment for termination: either a prominently located direct link or an immediately accessible termination email.

So you may be aware, San Diego County District Attorney is a member of the California Automatic Renewal Task Force, also known as CART. We’ve been very active in this arena for civil law enforcement. We’re very interested in these amendments and we will be active in this arena going forward.

These changes take place July 1, 2022, so there is some time to bring a company’s website and web flow into compliance.


As a complement to the automatic renewal law, I’d like to talk about the Song-Beverly Consumer Warranty Act, which covers recurring contracts for service.58

This piece of legislation is similar to the automatic renewal law ("ARL"), in that it also requires clear and conspicuous disclosures of any recurring or periodic service contract. Those disclosures must also contain the service that is covered by the contract and must contain any alternatives, such as a fixed term for service. Like the ARL, it requires the consumer’s affirmative consent to entering into this recurring contract but unlike the ARL, it actually contains a definition of what affirmative consent is. So I would direct you to take a look at the language in the statute.

[Page 21]

The Song-Beverly Consumer Warranty Act also requires that the ability for a consumer to cancel a service contract be unobstructed, with the ability to, at a minimum, access a toll-free number, email, postal address, and website for cancellation. The purpose behind the law is that the consumer should not be lured into some sort of recurring contract and have difficulty exiting that contract. The new legislation also covers, once a contract is terminated, the refunds that should be allowed.

These two pieces of legislation are a nice opportunity to reach out to some of your clients, alert them to these two new pieces of legislation, and just let them know that CART is going to be active in this field going forward as well. We’re looking forward to seeing how companies will conform to these new requirements.

The other two pieces of legislation deal with debt collection—another area that my office has been interested in and obviously is very important for consumer protection.

Starting in January 2022, the Fair Debt Settlement Practices Act will go into effect, which prohibits any false, deceptive or misleading practices regarding debt settlement process, as well as any false, abusive, or deceptive practices for payment processor activities. So this Act requires disclosures be provided to the consumer. It also requires termination of any debt services contract. It does contain certain exemptions to who is not covered by the statute.

I would encourage you to take a look to see if your clients would fall within any of those exemptions. One of those exemptions would be an attorney or a law firm, if they fall within certain categories delineated within the statute.

The enforcement mechanism would allow for actual as well as statutory damages of no less than a thousand dollars and no more than $5,000 per violation, and injunctive relief. There’s also attorneys’ fees, which are allowable both for the prevailing consumer but also in certain circumstances if the matter was not brought in good faith for the debt services provider.

There is also a safe harbor that the service provider could take advantage of, and the statute of limitations would be four years from the date of the last payment or when the consumer discovered or reasonably should have discovered facts giving rise to the claim.

The next piece of legislation concerning debt collection is the requirement that any assignment of the debt have some notification to the debtor, upon written request. And it delineates within 30 days of the written request, what sort of information the debtor is entitled to have, as well as requiring that any assigned debt be backed up by supporting documentation that the debt collector will have access to.

Often we run into situations where debt is sold so far down the line, being able to validate and verify the debt has been a big issue. So this piece of legislation is geared towards remedying some of those situations in which the assignment of debt leads to certain situations where the debtor is unable to get any support for what was originally owed.


The last piece of legislation I’d like to bring your attention to is the fact that Proposition 24 was in fact passed. About a week after last year’s GSI presentation, the voters went to the booth and decided that the enhancements that had already been passed through the California privacy law needed to be amended and expanded further.

As a result, the California Consumer Privacy Act of 2018 has now been expanded and amended through the California Privacy Rights Act.59 There’s a whole new section in the California Privacy Rights Act, which would require a completely new panel to go into the details, but be aware of this law that will come into effect in 2023.

[Page 22]


The first case law update I’d like to address is one in which the California Supreme Court held that unfiled escrow fees that were charged to a consumer violate the Insurance Code.60 The title insurance company had made a couple of arguments, one of which was that they had indemnity from any civil proceeding or prosecution because of the indemnification statutes within the Insurance Code.

The Supreme Court rejected the arguments and said no, this is not what is regulated, but only fees that are actually authorized under that Act fall within the scope of the indemnity.

The next argument that the title company had made was that this was within the exclusive jurisdiction of the Insurance Commissioner. That also was not found to be persuasive to the Supreme Court, which found the Act is a permissive statute to bring a complaint to the Insurance Commissioner, it was not mandatory.

The remedies allowed by the agency were not as fulsome as what you can get in private litigation or through prosecution, and the Commissioner himself took the position that he does not have exclusive authority to hear these cases. So the court ultimately ruled that unfiled escrow fees cases can in fact go forward.

The next case is very straightforward: UCL damages versus restitution. This case61 involved an optometrist who had alleged violations of UCL by a large retail chain of optometrists and he had wanted to receive payments for lost market share that he was alleging, and the court looked at the underlying theory payments and saw that lost market share, lost opportunity, lost profits, were really a damages claim and not restitution because there was nothing he was deprived of that he could actually be restored to, and being a damages theory, it was not recoverable under the UCL.

The next case is Best v. Ocwen Loan Servicing,62 and in that case the court found that nonjudicial foreclosures were consumer debt that was governed by the Rosenthal Act. The court went through history of case law regarding whether mortgages and deed trusts could be considered consumer debt.

The weight of more recent opinions is toward the fact that it was in fact consumer debt. The Rosenthal Act had been amended to specifically state mortgage debt was consumer debt, and that amendment made clear that this was not a change in the law but rather a declaration of already existing law.

I’ll now jump to Serova v. Sony Music Entertainment.63 We’re all eagerly awaiting the California Supreme Court ruling on that case regarding an anti-SLAPP motion with commercial speech within that ruling. Sony Music had issued a Michael Jackson album but three tracks on that album were not sung by Michael Jackson. The factual dispute was: who was the lead singer?

The appellate court found that there was a public interest here and that these statements about who was the actual singer on those tracks was something that was an advancement of the right to free speech.

The second part of the anti-SLAPP motion interestingly found that the statements were noncommercial speech. They were noncommercial speech because there was a controversy over the facts of who was the actual singer, so it was Sony’s opinion and not a factual statement; and second, the identity of the singer was so intertwined with the music itself that it was protected by the First Amendment.

This has been a much discussed opinion. It has a lot of amicus briefing on the topic and we’ll see how the Supreme Court rules hopefully soon.

As a public service announcement, civil law enforcement is very interested in debt collecting

[Page 23]

and fair debt collecting, especially as we come out of the pandemic and there will be financial hardship on a lot of Californians. The pieces of legislation I have covered reflect this concern.

To the extent that I didn’t get the message out and you can improve your relationship with your clients through any sort of legal counseling on these topics, that would be to their benefit and greatly appreciated as well.

MS. LEE: Thank you, Colleen, for that great overview.

I’d just like to conclude by again thanking our esteemed panelists this morning, Shana Wallace, Tom Greene, and Colleen Huschke. You’ve all done a terrific job with your presentations, given us a lot to think about, so thank you so very much.



1. Malinda Lee is a Deputy Attorney General with the Healthcare Rights and Access Section’s Competition Unit in the California Attorney General’s Office. Her practice is focused on enforcement of state and federal antitrust laws in healthcare and pharmaceutical markets, and other competition-related legal work that impacts services and products in those markets.

2. Comcast Corp. v. Viamedia, Inc., 141 S. Ct. 2877 (2021).

3. Br. Amicus Curiae of the United States, Comcast Corp. v. Viamedia, Inc., No. 18-2852 (U.S. May 25, 2021).

4. Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585 (1985).

5. Verizon Commc’ns v. Law Offices of Curtis V. Trinko, 540 U.S. 398, 409 (2004).

6. For a more in-depth description of the various levels of competition involved in, and affected by, Comcast’s conduct, see Viamedia, Inc. v. Comcast Corp., 951 F.3d 429, 436-49, 474-78 (7th Cir. 2020) (describing competitors and competition, as well as harm to competition from Comcast’s conduct).

7. Pet. for Writ of Certiorari at 10, Comcast Corp. v. Viamedia, Inc., No. 18-2852 (U.S. May 25, 2021) (citing Frank H. Easterbrook, The Chicago School and Exclusionary Conduct, 31 HARV. J.L. & PUB. POL’Y 439, 442 (2008) (noting the essay was given as "a talk for a panel of the Federalist Society’s Conference on the Contributions of Judge Robert H. Bork on June 25, 2007")).

8. Novell, Inc. v. Microsoft Corp., 731 F.3d 1064, 1072 (10th Cir. 2013).

9. Gergory J. Werden, Identifying Exclusionary Conduct Under Section 2: The "No Economic Sense" Test, 73 ANTITRUST L.J. 413, 422-25 (2006).

10. Viamedia, 951 F.3d at 461 ("Comcast proposes that if a defendant merely postulates ‘a valid business purpose’—apparently including any business purpose a defendant could dream up, regardless of feasibility or value—that ‘ends the inquiry.’ ‘[T]here is no ‘balancing’ of benefits and harms,’ Comcast declares."). For additional discussion of this standard, see id. at 461-62 & n. 13.

11. Id. at 461 ("[A]s explained by the government at oral argument here—it is an objective ‘balancing’ test that requires more than just ‘a slight procompetitive benefit or efficiency gain.’").

12. Br. Amicus Curiae of the United States, supra note 3, at 17-19 ("As the government explained at oral argument below, the term ‘balancing’ can be used in this context to refer to the offsetting of any profits to the defendant both by the short-term losses it incurs, and by the portion of those profits that are attributable to anticompetitive (rather than efficiency) gains.").

13. Id. at 10-13.

14. Viamedia, 951 F.3d at 455-60.

15. Id. at 460-61, 478.


17. Viamedia, 951 F.3d at 480.

18. Id.

19. Id. at 480-81 ("Yet courts are often called upon to undertake complicated, long-term supervision of complex cases and remedies. The judiciary need not and should not adopt a posture of learned helplessness in the face of proven antitrust violations.").

20. Id. at 475.

21. Id. at 475-76.

22. Broadcast Music, Inc. v. Columbia Broad. Sys., Inc., 441 U.S. 1 (1979).

23. Viamedia, 951 F.3d at 476-78 (citing FED. TRADE COMM’N & U.S. DEP’T OF JUSTICE, ANTITRUST GUIDELINES FOR COLLABORATIONS AMONG COMPETITORS (Apr. 2000), the Seventh Circuit noted that "Comcast’s conduct . . . turned a previously procompetitive platform into a weapon to decrease competition" by running afoul of a half-dozen flags described by the Guidelines).

[Page 24]

24. Viamedia, Inc. v. Comcast Corp., No 1:16-cv-05486 (N.D. Ill. Nov. 1, 2021), ECF No. 471.

25. Nat’l Collegiate Athletic Ass’n v. Alston, 141 S. Ct. 2141 (2021).

26. O’Bannon v. Nat’l Collegiate Athletic Ass’n, 7 F. Supp. 3d 955 (N.D. Cal. 2014), aff’d in part and vacated in part, 802 F.3d 1049 (9th Cir. 2015).

27. Alston, 141 S. Ct. at 2147.

28. Id. at 2148-51.

29. Id. at 2152-53, 2163.

30. Id. at 2167-68 ("[T]he NCAA says that colleges may decline to pay student athletes because the defining feature of college sports . . . is that the student athletes are not paid. In my view, the argument is circular and unpersuasive. The NCAA couches its arguments for not paying student athletes in innocuous labels. But the labels cannot disguise the reality: The NCAA’s business model would be flatly illegal in almost any other industry in America. . . . Price-fixing labor is price-fixing labor. And price-fixing labor is ordinarily a textbook antitrust problem. . . . Businesses like the NCAA cannot avoid the consequences of price-fixing labor by incorporating price-fixed labor into the definition of the product. Or to put it in more doctrinal terms, a monopsony cannot launder its price-fixing of labor by calling it product definition.").

31. House v. Nat’l Collegiate Athletic Ass’n, No. 4:20-cv-03919 (N.D. Cal.) (motion to dismiss decision reported at 2021 WL 3578572 (N.D. Cal. June 24, 2021)).

32. See, e.g., Johnson v. Nat’l Collegiate Athletic Ass’n, No. 2:19-cv-05230-JP (E.D. Pa.).

33. Final J., United States v. Adobe Systems, Inc., No. 1:10-cv-01629 (D.D.C. Mar. 18, 2011).


35. See, e.g., Arindam Kar, Antitrust Division to Criminally Prosecute No-Poaching Agreements, BRYAN CAVE LEIGHTON PAISNER LLP (Feb. 7, 2018), (reporting that Assistant Attorney General Makan Delrahim "announced the possible upcoming criminal charges at a January 19, 2018 conference hosted by the Antitrust Research Foundation").

36. Indictment, United States v. Surgical Care Affiliates, LLC, No. 3:21-cr-00011 (N.D. Tex. Jan 5, 2021).

37. Mem. in Support of Defs.’ Mot. to Dismiss at 17 n. 4, United States v. Surgical Care Affiliates LLC, No. 3:21-cr-00011 (N.D. Tex. Mar. 26, 2021) ("[A]pplying the per se rule in the criminal context is difficult to reconcile with the Supreme Court’s repeated holdings that irrebuttable presumptions violate the Fifth and Sixth Amendments . . . [and] SCA reserves all rights to press those constitutional arguments should this Court allow this prosecution to proceed.").

38. Pet. for Writ of Certiorari, Sanchez et al v. United States, No. 19-288 (U.S. Aug. 30, 2019).

39. Compl., United States v. Bertelsmann SE & Co. KGaA, No. 1:21-cv-02886 (D.D.C. Nov. 2, 2021).

40. Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., Inc., 549 U.S. 312 (2007).

41. Bristol-Myers Squibb Co. v. Super. Ct., 137 S. Ct. 1773 (2017).

42. Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct., 141 S. Ct. 1017 (2021).

43. Spokeo, Inc. v. Robins, 578 U.S. 330 (2016).

44. TransUnion LLC v. Ramirez, 141 S. Ct. 2190 (2021).

45. 15 U.S.C. §§ 1681 et seq.

46. TransUnion, 141 S. Ct. at 2214 (Thomas, J., dissenting).

47. Moser v. Benefytt, Inc., 8 F.4th 872 (9th Cir. 2021); see 47 U.S.C. § 227.

48. Olean Wholesale Grocery Coop. v. Bumble Bee Foods LLC, 993 F.3d 774 (9th Cir.), en banc pet. granted, 5 F.4th 950 (9th Cir. Aug. 3, 2021).

49. Id. at 794.

50. Id. at 795.

51. McGill v. Citibank, N.A., 2 Cal. 5th 945 (2017).

52. CAL. CIV. CODE § 3513.

53. Blair v. Rent-A-Center, Inc., 928 F.3d 819 (9th Cir. 2019).

54. 9 U.S.C. §§ 1 et seq.

55. 15 U.S.C. § 7a-3.

56. Competitive Health Insurance Reform Act, Pub. L. No. 116-327, 134 Stat. 5097 (2021).

57. CAL. BUS. & PROF. CODE §§ 17600 et seq.

58. CAL. CIV. CODE §§ 1790 et seq.

59. CAL. CIV. CODE §§ 1798.100 et seq.

60. Villanueva v. Fid. Nat’l Title Co., 11 Cal. 5th 104 (2021).

61. Lee v. Luxottica Retail N. Am., Inc., 65 Cal. App. 5th 793 (2021).

62. Best v. Ocwen Loan Servicing, 64 Cal. App. 5th 568 (2021).

63. Serova v. Sony Music Ent., 44 Cal. App. 5th 103 (2020), pet. for review granted, 461 P.3d 1251 (Cal. 2020).

Forgot Password

Enter the email associated with you account. You will then receive a link in your inbox to reset your password.

Personal Information

Select Section(s)

CLA Membership is $99 and includes one section. Additional sections are $99 each.