Ninth Circuit Upholds Dismissal of Tin Can Conspiracy Allegations

The Ninth Circuit Court of Appeals has rejected Stanislaus Food Products Co.’s attempt to revive a lawsuit alleging that several major manufacturers of tin cans conspired to cede the market to a single company, USS-POSCO Industries (UPI). Stanislaus Food Prods. Co. v. USS-POSCO Industries, No. 13-15475 (9th Cir., order entered October 13, 2015). “This appeal, which centers on tin mill products used to package food, teaches that there’s no substitute for concrete evidence,” the decision begins.

Stanislaus, a tomato cannery, alleged that UPI, a joint venture of U.S. Steel and POSCO America Steel Corp., conspired with other tin mill producers to allocate the tin can market to UPI and fix the prices of tin mill products. Stanislaus cited the fact that POSCO never entered the western U.S. market as evidence of conspiracy; the court considered the practicality of the allegations and found them lacking. “A scheme like Stanislaus alleges would not be rational unless U.S. Steel had little competition outside of the western United States or the potential payoff through ownership of UPI was likely to be significant,” the court noted. Stanislaus’ evidence was also insufficient, the court found, because the fact the companies raised prices at similar times merely reflected fluctuations in the steel market. Accordingly, the Ninth Circuit dismissed Stanislaus’ appeal.

Issue 581