Last month, our antitrust column was devoted to the late Justice Antonin Scalia’s antitrust legacy on the U.S. Supreme Court, focusing on his three antitrust opinions for the majority. At that time, we promised to continue that analysis, focusing this month on Scalia’s many antitrust dissents. However, history intervened and President Obama nominated Chief Judge Merrick Garland of the U.S. Court of Appeals for the District of Columbia Circuit to replace Scalia. In the wake of that controversial nomination, Garland has been subsequently heralded by some commentators as an antitrust expert who may have an important impact on antitrust cases before the high court. While Garland certainly has experience with antitrust matters, he has not said he is an antitrust expert. Indeed, we respectfully would not go so far as to classify him as an antitrust expert, as was, for example, Justice John Paul Stevens before he was elevated to the Supreme Court. (See “Before Joining Bench, Stevens Molded Antitrust Law,” published May 4, 2010, in The Legal.) This article focuses on the substantive antitrust opinions in which Garland has joined or which he authored during his tenure on the D.C. Circuit since 1997.
Much has been written already regarding Garland’s tenure at Harvard Law School where he taught antitrust law for one year in 1986-87. He also wrote an antitrust article 30 years ago for the Yale Law Journal on the state antitrust immunity doctrine where he advocated non-interference with state regulations. While a partner at Arnold & Porter he handled one published antitrust case involving a tying claim. However, less attention has been given to Garland’s actual antitrust opinions from his tenure on the D.C. Circuit. In short, while Garland is certainly a learned jurist versed in antitrust law, his time on the bench has yet to reveal his unique insight or approach to antitrust issues, should he be confirmed to the Supreme Court. In fact, Garland joined in the majority in six cases involving a substantive analysis of antitrust law by the D.C. Circuit, but did not author any of those majority opinions.
In fact, Garland has authored only a single opinion in a substantive antitrust case since his appointment to the D.C. Circuit, which was a dissenting/concurring opinion.
Garland’s first antitrust case on the D.C. Circuit was Thomas v. Network Solutions, 176 F.3d 500 (1999), a 1999 case in which domain name registrants sued the National Science Foundation and private contractor Network Solutions for alleged violations of Section 2 of the Sherman Act. The plaintiffs alleged that the government foundation and private contractor, essentially responsible for maintaining the Internet and assigning domain names, had conspired to abuse their monopoly power by refusing to allow potential competitors to introduce new top-level domains, e.g., .com, .gov or .org. The district court dismissed the plaintiffs’ claim on the ground that the federal instrumentality doctrine gave Network Solutions the same immunity from antitrust liability as that enjoyed by the National Science Foundation. A three-judge panel of the D.C. Circuit, including Garland, affirmed the dismissal, but on grounds raised on appeal and not presented to the district court, namely that the plaintiffs lacked standing to assert an essential facilities claim because they were not direct competitors of Network Solutions.
Subsequently, in 2000-01, Garland was a member of the three-judge panels that considered the Federal Trade Commission’s efforts to enjoin the pending merger between the jarred baby-food divisions of Heinz and Milnot Holding Corp., Beech-Nut. First, in 2000, Garland joined in the per curiam opinion that granted emergency relief enjoining the proposed merger. The district court in that case had denied the relief, and the D.C. Circuit reversed. The appeals court noted that the FTC’s economic analysis showed that the jarred baby-food industry was highly concentrated, and that the FTC demonstrated a substantial probability of success under Section 7 of the Clayton Antitrust Act, which bars mergers that substantially lessen competition. While Heinz and Milnot/Beech-Nut raised as a defense the usual increased efficiencies and competition against the dominant player in the industry, Gerber, the D.C. Circuit deferred to the FTC’s expertise and found the defense too novel to overcome the FTC’s prima facie showing that it was entitled to emergency injunctive relief, stating that, “The public interest in enforcement of the antitrust laws is strong; any injury to competition from going forward with the merger would plainly be irreversible, while the same cannot be said for any loss to competition from its delay.”
Then, in 2001, Garland was a member of the three-judge panel that ordered preliminary injunctive relief, further halting the merger Heinz/Beech-Nut merger pending review by the FTC (the FTC ultimately prevented the merger). Later, that same year, in Andrx Pharmaceuticals v. Biovail International, Nos. 01-1650, 02-1025 (2002). Garland again joined a unanimous three-judge panel of the D.C. Circuit in reversing the district court’s grant of a motion to dismiss, with prejudice, of certain counterclaims by Biovail. The D.C. Circuit held that it was in error to grant that motion to dismiss with prejudice where Biovail could replead and allege facts showing antitrust injury and causation.
In 2004, Garland authored his sole substantive antitrust opinion in McDonnell Douglas v. Air Force, 375 F.3d 1182 (2004), a concurrence and dissent, in part. In a so-called “reverse” Freedom of Information Act case, McDonnell Douglas Corp. challenged as arbitrary and capricious the decision of the Air Force to release to Lockheed Martin a copy of the contract between McDonnell Douglas and the Air Force for maintenance of KC-10 and KDC-10 aircraft. While McDonnell Douglas agreed that the baseline contract price had to be released, it argued that certain line items constituted trade secrets exempt from disclosure, which if released would give McDonnell Douglas a competitive advantage. The district court found for the Air Force, and the D.C. Circuit both affirmed and reversed in part, finding certain line items should be released to Lockheed Martin. Garland concurred and dissented, stating that the line-item information was not shielded from disclosure. Garland expressed his view that the D.C. Circuit failed to give the Air Force the deference it was owed, absent actual evidence of substantial harm to McDonnell Douglas if the information was released.
Garland did not hear another case in which substantive antitrust issues were before the D.C. Circuit until 2008, when the court considered Stolt-Nielsen Transportation Group Ltd. v. United States, 534 F.3d 728, 733 (D.C. Cir. 2008), another case raising issues of public access to government records. In that case, Stolt-Nielsen Transportation Group, a parcel tanker shipping company, allegedly colluded with other such companies not to compete on deep-sea trade routes as part of an international cartel. Fearing prosecution, in early 2000, Stolt-Nielsen entered into an amnesty agreement with the Antitrust Division of the U.S. Department of Justice, as part of the division’s corporate leniency program. Thereafter, in 2004, the division revoked Stolt-Nielsen’s amnesty, believing it had not complied with the terms of the amnesty agreement. Litigation between Stolt-Nielsen and the Justice Department ensued, and via a series of FOIA requests, Stolt-Nielsen sought “all amnesty agreements entered into by the Antitrust Division from August 1993 to the present.” Recognizing the potential confidentiality issues stemming from such a request, Stolt-Nielsen affirmatively offered to accept the amnesty agreements with the names and identities of the parties redacted. In a subsequent FOIA action, both the Justice Department and Stolt-Nielsen moved for summary judgment, and the district court held for the government. The D.C. Circuit reversed and remanded, holding that the Antitrust Division had improperly relied on a paralegal’s conclusion that limited redactions were not possible.
Finally, in 2013, Garland was part of the unanimous three-judge panel that reversed the district court in In re Rail Freight Fuel-Surcharge Antitrust Litigation, No. 12-7085 (2013). There, the D.C. Circuit reversed, finding that the damages model was over-inclusive and may have inappropriately included parties that did not suffer any damage.
In conclusion, as can be seen from a review of the substantive antitrust opinions in which Garland joined, or the dissent he authored, Garland would appear to be a measured, thorough, thoughtful jurist who fully searches the record, relying not just on the arguments or speculation advanced by counsel or the district court. Furthermore, and not surprisingly given his position in the D.C. Circuit, and his prior experience at the Department of Justice, Garland appears highly deferential to government agencies, while remaining strongly in favor of the disclosure of public records. While Garland’s time on the D.C. Circuit has not given ample opportunity to assess the conclusions of many that he is an expert in antitrust matters, perhaps, he may prove himself as such on the Supreme Court, as others have, if his nomination moves forward. Stay tuned. •
Carl W. Hittinger is a senior partner in Baker & Hostetler’s antitrust group and litigation group coordinator for the firm’s Philadelphia office. He concentrates his practice on complex commercial and civil rights trial and appellate litigation, with a particular emphasis on antitrust and unfair competition matters. He can be reached at 215-564-2898 or email@example.com. Julian D. Perlman is a senior associate in the firm’s litigation group, with a focus on complex commercial litigation, including antitrust litigation matters. He is resident in the firm’s New York City office, and his practice frequently brings him to Philadelphia, his hometown. He can be reached at 212-589-4629 or firstname.lastname@example.org.
Reprinted with permission from the “April 2, 2016” edition of the “The Legal Intelligencer”© 2016 ALM Media Properties, LLC. All rights reserved.