Court Dismisses Remaining Claims in Milk Antitrust Litigation

A federal court in Tennessee has dismissed the two remaining claims in antitrust litigation filed by certain retail processed milk sellers against Dean Foods Co. and the Dairy Farmers of America, Inc. In re: Se. Milk Antitrust Litig., No. 08-1000 (E.D. Tenn., decided March 27, 2012) (ruling applies to Food Lion, LLC v. Dean Foods Co., No. 07-188).

At issue were claims for violation of sections 1 and 2 of the Sherman Act (agreement not to compete and conspiracy to monopolize). The court found that the plaintiffs’ expert failed to “create a material issue of fact on the question of whether the price increases were ‘by reason of’ an illegal conspiracy in violation of the antitrust laws and Plaintiffs do not allege an injury of the kind which the antitrust laws are designed to prevent.” Because the plaintiffs were unable to establish antitrust injury, the court determined that the defendants were entitled to summary judgment “on this basis alone.”

The court also decided that the plaintiffs could not prove the relevant antitrust geographic market and that their claims had to be judged by a rule-of-reason standard because the agreement between the defendants had “substantial vertical elements.” According to the court, it is for the court, and not for a jury, to decide which legal standard to apply. Had the court found that the essence of the agreement was horizontal, that is, between “two horizontal competitors,” the issues would have been analyzed under a per se standard.