Shields v. Federation Internationale De Natation

1

2

3

4 UNITED STATES DISTRICT COURT

5 NORTHERN DISTRICT OF CALIFORNIA

6

7 THOMAS A. SHIELDS, et al., Case Nos. 18-cv-07393-JSC

Plaintiffs, 18-cv-07394-JSC

8

v.

9 ORDER RE: MOTIONS FOR

10 FEDERATION INTERNATIONALE DE SUMMARY JUDGMENT

NATATION,

Re: Case No. 18-cv-07393-JSC, Dkt. Nos.

11

Defendant.

316, 317, 318, 320, 321, 325, 326, 327, 333,

12 INTERNATIONAL SWIMMING

LEAGUE, LTD, 334, 337, 340, 346, 347, 351, 352;

13

Plaintiff, Case No. 18-cv-07394-JSC, Dkt. Nos. 355,

14

v. 356, 357, 358, 359, 363, 364, 368, 370, 371,

15

FEDERATION INTERNATIONALE DE 377, 383, 384, 387, 390, 393, 399, 408, 409.

16 NATATION,

17 Defendant.

18

19 Thomas A. Shields, Michael C. Andrew, and Katinka Hosszú (the individual “Plaintiffs”)

20 are professional swimmers who bring federal antitrust claims and a state law tort claim against the

21 Fédération Internationale de Natation (“FINA”), related to FINA’s control over international

22 swimming competitions. (Dkt. No. 83.)1 Plaintiffs represent a Rule 23(b)(2) injunctive relief

23 class and seek damages on their own behalf. (Dkt. No. 299.) In a related case, the International

24 Swimming League, Ltd. (“ISL”), a rival organizer of swimming competitions and buyer of

25 swimmers’ services, brings its own federal antitrust claims and state law tort claim against FINA.

26

27 1 Record citations are to material in the Electronic Case File (“ECF”) in Case No. 18-cv-07393-

1 (Case No. 18-cv-07394-JSC, Dkt. No. 100.)

2 Before the Court are FINA’s motions for summary judgment against Plaintiffs and ISL,

3 (Dkt. No. 321; Case No. 18-cv-07394-JSC, Dkt. No. 364); Plaintiffs’ and ISL’s joint motion for

4 summary judgment against FINA, (Dkt. No. 325; Case No. 18-cv-07394-JSC, Dkt. No. 371); and

5 related motions to file under seal, (Dkt. Nos. 317, 318, 320, 326, 327, 333, 334, 337, 340, 346,

6 347, 351, 352; Case No. 18-cv-07394-JSC, Dkt. Nos. 363, 368, 370, 377, 383, 384, 387, 390, 393,

7 399, 400, 408, 409). Having carefully considered the briefing, and with the benefit of oral

8 argument on October 20, 2022, the Court GRANTS FINA’s motions for summary judgment,

9 DENIES Plaintiffs’ and ISL’s joint motion for summary judgment, and disposes of the sealing

10 motions below.

11 BACKGROUND

12 FINA is a Swiss organization recognized by the International Olympic Committee as the

13 governing body for international and Olympic aquatic sports: swimming, open water swimming,

14 diving, high diving, water polo, artistic swimming, and masters. (Dkt. No. 322 ¶¶ 7–8, 11.) FINA

15 develops rules for aquatic sports, keeps world records, holds and sanctions international

16 competitions, and manages aquatics competitions at the Olympics. (Id. ¶¶ 8–10.) FINA sets the

17 qualifying criteria for swimmers to participate in the Olympics and recognizes only qualifying

18 times from competitions held or sanctioned by FINA. (Dkt. No. 329-76 at 23 (By Law (“BL”)

19 9.3.6.4); Dkt. No. 329-75 at 3 (General Rule (“GR”) 1.1).)

20 FINA’s members are 209 national federations. (Dkt. No. 322 ¶ 12.) Its governance

21 structure includes the Bureau (25 members), the Executive (8 members), and the General

22 Congress (two voting delegates from each of 209 member federations). (Dkt. No. 329-3 at 10

23 (Constitution (“C”) 13); Dkt. No. 322 ¶¶ 16–19.) Member federations must comply with FINA

24 rules, ensure their swimmers comply with FINA rules, and enforce penalties levied by FINA

25 against swimmers and other member federations. (Dkt. No. 329-74 at 4 (C 3.12), 7 (C 8.2.1-6), 10

26 (C 12.5); Dkt. No. 329-75 at 5 (GR 4.5); Dkt. No. 87 ¶ 43; Dkt. No. 322 ¶ 14.) Member

27 federations may designate “national governing bod[ies]” specific to a sport. (Dkt. No. 329-3 at 6

1 federation and USA Swimming, Inc. is the American governing body for swimming, although

2 USA Swimming has operated as the de facto American member federation. (Dkt. No. 323 ¶ 5.)

3 FINA keeps a calendar of international competitions, the asserted purpose of which is to

4 prevent scheduling conflicts, to ensure swimmers have many opportunities to compete, and to

5 apply FINA rules consistently. (Dkt. No. 322 ¶¶ 20–21.) FINA holds its own international

6 competitions, which are automatically included on its calendar and conducted according to

7 FINA’s rules. (Id. ¶ 25.) Member federations may also hold international competitions on their

8 own or in partnership with independent organizations. (Id. ¶ 52.) To do so, they must seek

9 FINA’s approval six months in advance. (Dkt. No. 329-76 at 87 (BL 12.3); Dkt. No. 322 ¶¶ 25–

10 26.) If FINA approves and sanctions the competition, it is included on FINA’s calendar and the

11 results can potentially be used for Olympic qualification. (Dkt. No. 322 ¶¶ 33, 52.) FINA has no

12 approval authority over (1) intra-national competitions in which swimmers and clubs do not

13 represent a member federation, or (2) international competitions held by independent

14 organizations without involvement from FINA or its member federations.2 (Dkt. No. 329-76 at 87

15 (BL 12.1, 12.3); Dkt. No. 322 ¶¶ 30, 32; Dkt. No. 323 ¶¶ 18–23.)

16 In 2017, ISL sought to enter the market for international swimming competitions and

17 compete with FINA. (Dkt. No. 329-14; Dkt. No. 329-15 at 9–11; Dkt. No. 329-16 at 7–9.) ISL

18 approached FINA to discuss sanctioning ISL’s competitions, but the two did not reach an

19 agreement. (Dkt. No. 329-15 at 11–14.)

20 In 2018, ISL began negotiating with member federations, including USA Swimming,

21 British Swimming, and the Italian Swimming Federation, to host international competitions in

22 partnership with ISL. (Dkt. No. 320-13 at 4; Dkt. No. 320-18 at 3; Dkt. No. 329-22 at 2; Dkt. No.

23 329-23 at 2; Dkt. No. 329-30 at 3; Dkt. Nos. 329-26, 329-56, 329-57.) In June 2018, FINA sent a

24 memorandum to all member federations about “a so-called international competition ‘International

25 Swimming League,’ which FINA does not recognise”:

26 We recommend and require that our National Federations respect and

27

apply [] FINA Rules, including: . . .

1

• BL 12.3 “All Continental and regional Organisations and

2 Member[] Federations shall seek approval from FINA for any

International Competition to be organised or sanctioned by

3 them.[”]

4 • C 7.5 “Each Member shall acknowledge in its national rules

that FINA is the only recognized body in the world which

5 governs Aquatics internationally”.

6 • C 8.2.1 “All members are obliged to support FINA in its

efforts to achieve its objectives”.

7

• GR 4.1 “No affiliated Member shall have any kind of

8 relationship with a non-affiliated or suspended body”.

9 . . . For the sake of clarification, [ISL] is neither recognised by nor

affiliated to FINA. Further, FINA has neither sanctioned the

10 competitions organised by this entity, nor approved their sanction by

other FINA bodies. . . .

11

Consequently, the competitions of [ISL] are not FINA sanctioned nor

12 FINA approved. They are not part of the international calendar. The

results and record achieved in these competitions are not and will not

13 be recognised.

14 FINA will assess the development of this matter and will consider

art. GR 4 and BL 12, as and where appropriate.

15

We hope this will help all FINA [member federations] to have a clear

16 and mutual understanding of FINA’s competence and jurisdiction in

respect to international competitions. It is in the interest of all

17 Members and other organisations of the FINA Family to maintain a

proper structure of the sport, securing development at all levels and

18 ensuring safe, proper and equal conditions for the competitors in all

FINA aquatic disciplines.

19

20 (Dkt. No. 329-35 (emphasis added).)

21 As reflected in the memo, in 2018 GR 4.1 prohibited member federations from having

22 “any kind of relationship with a non-affiliated or suspended body” unless, as set forth in GR 4.4,

23 FINA authorized the relationship. (Dkt. No. 329-4 at 5.) At the same time, GR 4.5 provided that

24 any “individual or group” violating GR 4 “shall” be “suspended by the affiliated Member

25 [federation] for a minimum period of one year, up to a maximum period of two years.” (Id.; see

26 Dkt. No. 329-38 at 2 (USA Swimming specifically noting GR 4.5 in response to June 2018 memo

27 citing GR 4); Dkt. No. 320-6 at 12–13 (July 2018 FINA Executive meeting noting GR 4.5 in

1 negotiating with ISL. (Dkt. No. 320-20 at 2 (“[W]anted to update you on ISL. . . . British

2 Swimming won[’]t be staging an event this year — because of the FINA situation.”); Dkt. No.

3 329-37 at 2 (“before USA Swimming can commit to taking part, we need to get an assurance from

4 ISL and from FINA (in writing) that FINA is on board”); Dkt. No. 329-39 at 2 (British Swimming

5 “can’t afford to take risks with our core purpose of delivering medals at the Olympic Games”).)

6 The Italian Swimming Federation continued negotiating with ISL about a December 2018

7 event in Turin. In October 2018, FINA sent another memo to member federations:

8 [T]he competition to be held in Torino (Italy) on 20th – 21st

December 2018 is not recognised by FINA.

9

Based on the interpretation of FINA Rule BL 12.3 confirmed by the

10 FINA Bureau, this competition is an International Competition, not a

national competition and is therefore subject to approval by FINA. Its

11 description as a national competition, in contradiction to its clear

international nature, is not correct. This description circumvents the

12 application of the rules applying to international events and more

fundamentally the jurisdictional order set forth in the FINA

13 Constitution.

14 No approval has been sought in accordance with the applicable

provisions of BL 12 for this competition, which is consequently not

15 sanctioned nor approved by FINA. . . .

16 FINA will further assess the development of this matter and will

consider consequences in application of art. GR 4 and BL 12, as and

17 where appropriate.

18 (Dkt. No. 320-22.) Member federations understood that GR 4.5 could be used to suspend

19 swimmers for participating in the Turin event, and some advised their swimmers of that risk.

20 (Dkt. No. 320-23 at 2; Dkt. No. 320-25 at 2; Dkt. No. 329-10 at 8; Dkt. No. 329-77 at 2; Dkt. No.

21 329-45 at 2.) Internally, FINA referred to the situation as “issu[ing] a severe penalty” to the

22 Italian Swimming Federation: “which Federation will step forward in the future to host ISL

23 meets? NONE!” (Dkt. No. 320-24; see Dkt. No. 320-31; Dkt. No. 320-37 (“The hammer is about

24 to come down on the Torino event.”).) Eventually, the Italian Swimming Federation cancelled the

25 December 2018 event “because it always places paramount importance on the Athletes’ status and

26 welfare and it simply cannot take the risk of Athletes . . . receiving sanctions.” (Dkt. No. 329-47

27 at 2.)

1 [S]wimmers are free to participate in competitions or events staged

by independent organisers, namely entities which are neither

2 members of FINA nor related to it in any way. . . . [S]uch

participation shall not be characterised as unauthorised relations in

3 application of FINA General Rules GR4, and shall not give rise to

sanctions by FINA.

4

5 (Dkt. No. 324-26 at 3.) And in July 2019, FINA amended GR 4.5 to repeal the suspension

6 provision. (Dkt. No. 322 ¶ 44; Dkt. No. 322-6 at 5.) FINA never suspended a swimmer under GR

7 4.5. (Dkt. No. 324-84 at 5–7; see Dkt. No. 322 ¶ 41.)

8 ISL hosted seasons in 2019, 2020, and 2021. (Case No. 18-cv-07394-JSC, Dkt. Nos. 367-

9 42, 367-43, 367-44.) It sought and obtained FINA’s approval for some events in which ISL

10 partnered with member federations. (Case No. 18-cv-07394-JSC, Dkt. Nos. 367-38 (granting

11 approval), 367-39 (granting and denying approval).)

12 RELEVANT PROCEDURAL HISTORY

13 Plaintiffs bring claims under Sherman Act Sections 1 and 2, as well as a state law claim for

14 tortious interference with contractual relations related to ISL’s December 2018 Turin event. (Dkt.

15 No. 83 ¶¶ 156–79.) ISL also brings claims under Sherman Act Sections 1 and 2, and a state law

16 claim for tortious interference with prospective economic relations related to the Turin event.

17 (Case No. 18-cv-07394-JSC, Dkt. No. 100 ¶¶ 147–69.) The Court certified an injunctive relief

18 class of swimmers, but denied certification of a damages class. (Dkt. No. 299.)

19 Because it is relevant to the analysis below, the Court notes no party has submitted expert

20 testimony on the merits (liability). In August 2021, the Court adopted the parties’ stipulated case

21 schedule, which set merits expert disclosure deadlines between September and December 2021.

22 (Dkt. No. 230 at 3; see Dkt. Nos. 235, 243, 245, 258, 267, 271, 288, 291 (scheduling orders that

23 did not modify merits expert disclosure deadlines).) Long after those deadlines had passed, and no

24 party had served any merits expert reports, the parties notified the Court of a dispute about the

25 deadlines. FINA wanted to extend the deadlines to allow it—and only it—to serve merits expert

26 reports, while Plaintiffs and ISL wanted new deadlines for all parties. (Dkt. No. 298.) As no party

27 had sought an extension of the deadlines before they had passed, and there was no good cause for

1 merits expert discovery deadlines. (Dkt. No. 310 at 3–12); see DRK Photo v. McGraw-Hill Glob.

2 Educ. Holdings, LLC, 870 F.3d 978, 989 (9th Cir. 2017).

3 Plaintiffs and ISL now move for summary judgment on FINA’s liability under Section 1 of

4 the Sherman Act and on FINA’s mootness defense to injunctive relief. FINA moves for summary

5 judgment against Plaintiffs and ISL on all claims. The Court first addresses FINA’s motion.

6 DISCUSSION

7 I. SHERMAN ACT SECTION 1

8 Section 1 of the Sherman Act prohibits “[e]very contract, combination . . . , or conspiracy

9 in restraint of trade.” 15 U.S.C. § 1. “The Supreme Court has interpreted this language to prohibit

10 only unreasonable restraints of trade.” PLS.Com, LLC v. Nat’l Ass’n of Realtors, 32 F.4th 824,

11 833 (9th Cir. 2022) (cleaned up), petition for cert. filed, (U.S. Sept. 27, 2022) (No. 22-289). To

12 prevail on a Section 1 claim, a plaintiff must demonstrate: “(1) that there was a contract,

13 combination, or conspiracy; (2) that the agreement unreasonably restrained trade under either a per

14 se rule of illegality or a rule of reason analysis; and (3) that the restraint affected interstate

15 commerce.” Tanaka v. Univ. of S. Cal., 252 F.3d 1059, 1062 (9th Cir. 2001) (cleaned up).

16 Plaintiffs and ISL argue FINA’s GR 4—prohibiting member federations from affiliating

17 with organizations not sanctioned by FINA, such as ISL, or risk draconian sanctions against the

18 federation and its swimmers—constitutes an unlawful horizontal group boycott. (Dkt. No. 340-1

19 at 15–20; Dkt. No. 352-1 at 7–9.) FINA contends it is entitled to summary judgment on the

20 Section 1 claim as a matter of law.

21 A. Element 1: Contract, Combination, or Conspiracy

22 1. Entities Capable of Conspiring

23 Section 1 “applies only to concerted action” that “joins together independent centers of

24 decisionmaking,” or in other words, “separate economic actors pursuing separate economic

25 interests.” Am. Needle, Inc. v. Nat’l Football League, 560 U.S. 183, 190, 196, 197 (2010)

26 (cleaned up; emphasis added). “The crucial question is whether the entities alleged to have

27 conspired maintain an economic unity, and whether the entities were either actual or potential

1 1034 (9th Cir. 2005) (cleaned up); see also Freeman v. San Diego Ass’n of Realtors, 322 F.3d

2 1133, 1148 (9th Cir. 2003) (“Where there is substantial common ownership, a fiduciary obligation

3 to act for another entity’s economic benefit or an agreement to divide profits and losses, individual

4 firms function as an economic unit and are generally treated as a single entity.”). The inquiry is a

5 functional one that considers “competitive reality,” so it is not determinative that the actors “are

6 legally distinct entities” or that such “legally distinct entities have organized themselves under a

7 single umbrella or into a structured joint venture.” Am. Needle, 560 U.S at 196.

8 At the motion to dismiss stage, the Court held the complaints adequately alleged “FINA

9 and its member federations are distinct entities and at least potential competitors. Thus, they are

10 capable of conspiring under Section 1.” Shields v. Fed’n Internationale de Natation, 419 F. Supp.

11 3d 1188, 1220 (N.D. Cal. 2019).3 FINA argues it is entitled to judgment because the record does

12 not contain evidence sufficient to support Plaintiffs’ allegations. The Court disagrees. A

13 reasonable trier of fact could find FINA and its member federations are not a single economic unit

14 and are actual or potential competitors.

15 First, the record shows FINA hosts competitions in which member federations participate

16 and that member federations host their own competitions from which they independently

17 financially benefit. (See Dkt. No. 329-7 at 3 (USA Swimming Form 990 noting it hosted

18 “multiple national events” in 2019); id. at 70 (USA Swimming is a 501(c)(3) that is not “a

19 subsidiary in an affiliated group or a parent-subsidiary controlled group”); Dkt. No. 329-74 at 4

20 (FINA constitution defining “competitions” to include FINA events as well as “events sanctioned

21 by FINA members”).) That FINA sets a worldwide events calendar further supports this

22 conclusion; it must coordinate among independent decision-makers, including its member

23 federations. (See Dkt. No. 329-2 at 13 (“FINA is tasked with creating a competition calendar that

24 protects the health and safety of its swimmers and ensures that certain rules—like anti-doping

25 precautions—are applied consistently across events.”); Dkt. No. 365 ¶ 52 (“FINA’s own events

26

27 3 The Court’s Order analyzed the original complaints, but the operative complaints have

1 represent a small fraction of the international events that qualify for inclusion in FINA’s

2 international events calendar. . . . [T]here are hundreds of other swimming competitions that are

3 staged by FINA’s Continental and/or Regional Organizations and FINA Members each year that

4 are recognized by FINA and included on FINA’s international competition calendar. There are

5 also numerous independent staged swimming competitions that an independent organizer stages in

6 conjunction with a FINA Member national federation that are also recognized by FINA.”).) This

7 evidence is not compatible with FINA and its members being a single economic unit as a matter of

8 undisputed fact. See Freeman, 322 F.3d at 1149 (“[W]here firms are not an economic unit and are

9 at least potential competitors, they are usually not a single entity for antitrust purposes.”).

10 Second, the record shows member federations negotiated directly with ISL, without prior

11 approval from FINA and without coordinating as one. (See Dkt. No. 320-18 at 3 (FINA executive

12 meeting minutes noting that USA Swimming and Australian Swimming had signed agreements

13 with ISL); Dkt. No. 329-8 at 3–4 (British Swimming CEO felt pressure to succeed in hosting 2019

14 event with ISL because “other federations bidding for events” would be watching); Dkt. No. 329-

15 22 at 2 (USA Swimming COO: “USA Swimming, like British Swimming and Swimming

16 Australia, is very interested in this project.”); Dkt. No. 329-30 at 3 (ISL Managing Director to

17 Swimming Australia CCO: “[W]e have advanced quite a lot with our negotiations with the US and

18 European[] cities, however we still haven’t made our final decision. In addition, we are certainly

19 still considering Australia . . . .”).) Indeed, the member federations competed with one another for

20 the opportunity. See Am. Needle, 560 U.S. at 196–97 (noting NFL teams “compete with one

21 another, not only on the playing field, but to attract fans, for gate receipts, and for contracts with

22 managerial and playing personnel”). Although FINA’s rules obligated the member federations to

23 get FINA’s approval to host international competitions, the record supports a finding that member

24 federations negotiated with ISL separately from FINA. See id. at 191 (noting “concerted action”

25 inquiry requires “a functional consideration of how the parties involved in the alleged

26 anticompetitive conduct actually operate”).

27 FINA argues it is in a “vertical” relationship with the member federations. That may be

1 federations are at the same level of distribution with respect to putting on swimming competitions,

2 and that the member federations are at the same level of distribution with respect to buying

3 swimmers’ services. Indeed, there is no evidence to support a reasonable inference the member

4 federations are FINA subsidiaries, that both are owned by the same person, that one is owned by a

5 subset of the other’s owners, or that they “pool their capital and share the risk of loss as well as the

6 opportunities for profit.” Freeman, 322 F.3d at 1147–48. That member federations must abide by

7 FINA rules or seek approval if they want FINA to sanction their events does not collapse them

8 into a single economic unit. See Am. Needle, 560 U.S. at 196; e.g., O’Bannon v. Nat’l Collegiate

9 Athletic Ass’n, 802 F.3d 1049, 1052–53, 1063–64 (9th Cir. 2015) (holding NCAA’s amateurism

10 rules binding its “member colleges and universities” constituted horizontal restraint of trade). The

11 record supports a reasonable inference FINA and the member federations put on their own events

12 and negotiated on separate tracks with ISL; so, a reasonable trier of fact could find they are

13 separate entities capable of conspiring.

14 2. Concerted Action

15 “[A]n arrangement must embody concerted action in order to be a ‘contract, combination .

16 . . , or conspiracy’ under § 1.” Am. Needle, 560 U.S. at 191.

17 A reasonable trier of fact could also find FINA’s written rules constitute concerted action

18 by FINA and its member federations. Cf. N. Am. Soccer League, LLC v. U.S. Soccer Fed’n, Inc.,

19 883 F.3d 32, 41 (2d Cir. 2018) (“If NASL were challenging the Standards themselves—in

20 totality—as violative of the antitrust laws, then the USSF Board’s promulgation of them would

21 constitute direct evidence of § 1 concerted action in that undertaking.”). FINA’s constitution

22 requires both it and its member federations to follow rules promulgated by FINA’s governing

23 bodies. (Dkt. No. 329-74 at 4 (C 3.12), 7 (C 8.2.1-6), 10 (C 12.5); Dkt. No. 329-75 at 5 (GR 4.5);

24 Dkt. No. 87 ¶ 43.) Member federations agree to follow FINA rules as a condition of their

25 applications, and they have a role in voting on those rules. (Dkt. No. 329-74 at 7 (C 8.1.4), 14 (C

26 15.3), 15–16 (C 5.9-5.10)); see Nat’l Collegiate Athletic Ass’n v. Bd. of Regents of Univ. of Okla.

27 (“Bd. of Regents”), 468 U.S. 85, 99 (1984) (“By participating in an association which prevents

1 rights that can be offered to broadcasters, the NCAA member institutions have created . . . an

2 agreement among competitors on the way in which they will compete with one another.”); e.g.,

3 Hairston v. Pac. 10 Conference, 101 F.3d 1315, 1319 (9th Cir. 1996) (“The Pac–10 members’

4 agreement to sanction [a member] fulfills the ‘contract, combination, or conspiracy’ prong.”).

5 This case is distinguishable from Toscano v. Professional Golfers Ass’n, in which the

6 entities’ acceptance of the association’s rules “demonstrated only that they agreed to purchase a

7 product[;] . . . [t]hey did not commit to a common scheme to act in restraint of trade.” 258 F.3d

8 978, 984 (9th Cir. 2001) (“Their promises . . . show only that the local sponsors accepted the fact

9 that the tournaments would be operated according to the PGA Tour’s rules and regulations, not

10 that they agreed to use those rules to restrain trade. . . . [They] had no involvement in the

11 establishment or enforcement of the allegedly anticompetitive provisions of the contracts.”). Here,

12 in contrast, a reasonable trier of fact could find GR 4 constitutes an agreement among the

13 competitor federations not to do business with a non-FINA approved competitor such as ISL.

14 FINA and the federations’ accepting, enforcing, and having a role in establishing GR 4 is

15 sufficient to support a finding of a commitment to a common scheme. See, e.g., Fed. Trade

16 Comm’n v. Ind. Fed’n of Dentists (“Ind. Fed’n”), 476 U.S. 447, 459 (1986) (“The Federation’s

17 policy takes the form of a horizontal agreement among the participating dentists to withhold from

18 their customers a particular service that they desire—the forwarding of x rays to insurance

19 companies along with claim forms.”); In re Nat’l Football League’s Sunday Ticket Antitrust Litig.

20 (“Sunday Ticket”), 933 F.3d 1136, 1152 (9th Cir. 2019) (“According to the complaint, the NFL

21 members vote to approve the contract between DirecTV and the NFL. Therefore, the complaint

22 adequately alleges that the Teams-NFL Agreement is a horizontal restraint—an agreement among

23 competitors that places an artificial limit on the quantity of televised football that is available for

24 sale to broadcasters and consumers.” (cleaned up)).

25 Accordingly, the record supports the conclusion that FINA and its member federations

26 took concerted action. See Tanaka, 252 F.3d at 1062.

27 3. Nature of the Restraint

1 relations, enforced (briefly) by the threat of suspending swimmers. See Dreamstime.com, LLC v.

2 Google LLC, 54 F.4th 1130, 1140 (9th Cir. 2022) (“The responsibility for framing the case lies

3 with the parties.”). ISL contends the unauthorized relations rule denied it access to the sellers’

4 market for swimming competitions and the buyers’ market for swimmers’ services, because

5 member federations and swimmers could not do business with ISL unless FINA approved. (Dkt.

6 No. 83 ¶¶ 3, 59, 157–66; Case No. 18-cv-07394-JSC, Dkt. No. 100 ¶¶ 3, 64, 148–57.) Plaintiffs

7 contend the suspension rule denied them access to the sellers’ market for swimming services,

8 because selling their labor to ISL would suspend them from FINA and jeopardize their Olympic

9 eligibility. (Dkt. No. 83 ¶¶ 3, 157–66; Case No. 18-cv-07394-JSC, Dkt. No. 100 ¶¶ 3, 148–57.)

10 Thus, their theory is GR 4 restrained member federations from partnering with ISL and restrained

11 swimmers from entering international competitions organized by ISL.

12 A reasonable trier of fact could find FINA’s rules constituted a horizontal restraint of trade.

13 See Ohio v. Am. Express Co. (“Amex”), 138 S. Ct. 2274, 2283–84 (2018) (explaining “horizontal”

14 restraints are “imposed by agreement between competitors” (cleaned up)); cf. Elecs. Corp. v.

15 Sharp Elecs. Corp., 485 U.S. 717, 730 (1988) (noting “vertical” restraints are “imposed by

16 agreement between firms at different levels of distribution”). Horizontal restraints include

17 “geographic division of markets,” “horizontal price fixing,” and other “agreement[s] to allocate a

18 market, such as in time or space, between a select few competitors at the same level of the

19 market.” California ex rel. Harris v. Safeway, Inc. (“Safeway”), 651 F.3d 1118, 1133 n.11 (9th

20 Cir. 2011); In re Glumetza Antitrust Litig., No. C 19-05822 WHA, 2021 WL 1817092, at *8 (N.D.

21 Cal. May 6, 2021). The record supports a finding that FINA’s member federations, who are at the

22 same level of distribution for putting on international competitions and buying swimmers’

23 services, agreed not to do business with ISL without FINA’s approval.

24 * * *

25 Based on the undisputed evidence in the record, a reasonable trier of fact could find FINA

26 and its member federations are separate economic actors capable of conspiring and that they

27 actually conspired on a restraint of trade. As such, a reasonable trier of fact could find Plaintiffs

1 1062.

2 B. Element 2: Unreasonable Restraint of Trade

3 Having determined a reasonable trier of fact could find FINA entered into a Section 1

4 contract, combination, or conspiracy, the next question is whether the trier of fact could find GR 4

5 unreasonably restrains trade. See Am. Needle, 560 U.S. at 186 (“The question whether an

6 arrangement is a contract, combination, or conspiracy is different from and antecedent to the

7 question whether it unreasonably restrains trade.”); Fed. Trade Comm’n v. Qualcomm Inc.

8 (“Qualcomm”), 969 F.3d 974, 989 (9th Cir. 2020) (“[A] plaintiff must prove (1) the existence of

9 an agreement, and (2) that the agreement was in unreasonable restraint of trade.”).

10 1. Antitrust Standards

11 “The selection of the proper mode of antitrust analysis is a question of law,” which the

12 Court may decide at the summary judgment stage. Safeway, 651 F.3d at 1124. The “presumptive

13 or default standard” for Section 1 analysis is the “rule of reason,” which “requires the antitrust

14 plaintiff to demonstrate that a particular contract or combination is in fact unreasonable and

15 anticompetitive.” Id. at 1133 (cleaned up). Under this analysis, there is a threshold requirement

16 “to accurately define the relevant market, which refers to the area of effective competition.”

17 Qualcomm, 969 F.3d at 992 (cleaned up). More rarely, courts may use the “per se approach” to

18 analyze practices that are “so harmful to competition and so rarely prove justified that the antitrust

19 laws do not require proof that an agreement of that kind is, in fact, anticompetitive in the particular

20 circumstances.” PLS.Com, 32 F.4th at 833 (cleaned up). Finally, between the rule of reason and

21 the per se approach lies the “truncated rule of reason” or “quick look” approach. Safeway, 651

22 F.3d at 1134.

23 [S]ometimes we can determine the competitive effects of a challenged

restraint in the twinkling of an eye. That is true, though, only for

24 restraints at opposite ends of the competitive spectrum. . . . [S]ome

restraints may be so obviously incapable of harming competition that

25 they require little scrutiny. . . . At the other end, some agreements

among competitors so obviously threaten to reduce output and raise

26 prices that they might be condemned as unlawful per se or rejected

after only a quick look.

27

1 Plaintiffs and ISL insist the per se or quick look approach applies to GR 4 while FINA

2 insists it must be analyzed under the default rule of reason. The choice matters because if the per

3 se or quick look approach applies, the Court assumes the restraint is anticompetitive without

4 inquiry into the particular market context in which it is found; that is, “[a] plaintiff is not required

5 to define a particular market for a per se claim.” PLS.Com, 32 F.4th at 838 (citing Bd. of Regents,

6 468 U.S. at 100).

7 2. The Per Se and Quick Look Approach does not Apply

8 Plaintiffs and ISL argue GR 4 is a classic group boycott and therefore the per se or quick

9 look approach applies. See In re Musical Instruments & Equip. Antitrust Litig., 798 F.3d 1186,

10 1191 (9th Cir. 2015).

11 The classic group boycott is a concerted attempt by a group of

competitors at one level to protect themselves from competition from

12 non-group members who seek to compete at that level. Typically, the

boycotting group combines to deprive would-be competitors of a

13 trade relationship which they need in order to enter (or survive in)

the level wherein the group operates. The group may accomplish its

14 exclusionary purpose by inducing suppliers not to sell to potential

competitors, by inducing customers not to buy from them, or, in some

15 cases, by refusing to deal with would-be competitors themselves. In

each instance, however, the hallmark of the group boycott is the effort

16 of competitors to barricade themselves from competition at their own

level.

17

18 PLS.Com, 32 F.4th at 834 (cleaned up and emphasis added; quoting Smith v. Pro Football, Inc.,

19 593 F.2d 1173, 1178 (D.C. Cir. 1978)). Plaintiffs and ISL argue GR 4 constitutes a classic group

20 boycott subject to per se analysis because it “deprive[s] ISL and other would-be competitors of the

21 trade relationships with national federations and swimmers they need to enter the market and

22 survive.” (Dkt. No. 320-3 at 25.)

23 The hole in this argument is that they do not identify any evidence, expert or otherwise,

24 that supports a finding ISL needs to affiliate with member federations to hold its own swimming

25 competitions. GR 4 does not (and did not in 2018) prevent swimmers from participating in

26 unauthorized events; it prevented and continues to prevent member federations from affiliating

27 with ISL and other non-sanctioned entities. (Dkt. No. 329-4 at 5.) The swimming competitions

1 proposing to affiliate with a non-approved entity. (See, e.g., Dkt. No. 320-7 at 5–6, Dkt. No. 320-

2 9 at 4 (World Swimming Association partnering with Singapore Swimming Federation); Case No.

3 18-cv-07394-JSC, Dkt. Nos. 367-21, 367-28 (ISL partnering with Italian Swimming Federation).)

4 It is undisputed that top-tier swimmers are not bound by contract to swim only in FINA-

5 sanctioned competitions. Indeed, the undisputed evidence is that ISL can and does sponsor top-

6 tier swimming competitions without any affiliation with member federations. For example, in

7 2019, ISL hosted a swimming competition in Naples, Italy without affiliating with FINA or any

8 member federation. (Dkt. No. 335-2 at 17–21.) And, ISL admits it does not need FINA to

9 conduct its swimming competition business. (Case No. 18-cv-07394-JSC, Dkt. No. 367-90 at 39–

10 40.) While FINA’s cooperation makes it easier for ISL to organize a swimming competition, it is

11 not necessary. (Case No. 18-cv-07394-JSC, Dkt. No. 367-89 at 29.) Further, the number of

12 swimming competitions ISL sponsored increased from 2019 through 2021. (Case No. 18-cv-

13 07394-JSC, Dkt. Nos. 367-42, 367-43, 367-44.) So, Plaintiffs’ assertion “it is undisputed that

14 FINA’s horizontal boycott cut off ISL’s access to a necessary input for ISL to compete,” (Dkt. No.

15 320-3 at 26), is wrong. It is not undisputed; instead, Plaintiffs’ assertion is unsupported. On this

16 particular record, no reasonable trier of fact could find GR 4 deprives “would-be competitors of a

17 trade relationship which they need in order to enter (or survive in) the level wherein the group

18 operates.” PLS.Com, 32 F.4th at 834; see id. at 835 (noting the Supreme Court has held “a group

19 boycott generally falls into the per se category if the boycotting firms . . . cut off access to a

20 supply, facility, or market necessary to enable the boycotted firm to compete” (cleaned up)).

21 Regardless of whether GR 4 qualifies as a horizontal group boycott, “[p]er se treatment is

22 proper only once experience with a particular kind of restraint enables the court to predict with

23 confidence that the rule of reason will condemn it.” Safeway, 651 F.3d at 1133 (cleaned up); cf.

24 PLS.Com, 32 F.4th at 837 (“Although we hold that PLS has adequately alleged a per se group

25 boycott, we leave to the district court to determine in the first instance whether it should apply per

26 se analysis or rule of reason analysis at later stages in this litigation.”). As the Supreme Court

27 recently cautioned in a case involving horizontal restraints in a sports league context:

industry—and aware that there are often hard-to-see efficiencies

1 attendant to complex business arrangements—we take special care

not to deploy these condemnatory tools until we have amassed

2 considerable experience with the type of restraint at issue and can

predict with confidence that it would be invalidated in all or almost

3 all instances.

4 Alston, 141 S. Ct. at 2156 (cleaned up); see also Safeway, 651 F.3d at 1134 (explaining courts may

5 use the quick look approach where “an observer with even a rudimentary understanding of

6 economics could conclude that the arrangements in question would have an anticompetitive effect

7 on customers and markets” (cleaned up)).

8 Courts do not have any experience with the restraint at issue here—the rules of a governing

9 body for international and Olympic sports that sets the qualifying criteria for athletes to participate

10 in the Olympics and is tasked with promoting the global development of particular sports. The

11 Court cannot “predict with confidence” that a rule requiring FINA to approve member federation

12 affiliation with a non-member entity “would be invalidated in all or almost all instances.” Alston,

13 141 S. Ct. at 2156 (cleaned up). For example, the record shows that in 2019 FINA declined to

14 approve USA Swimming co-sponsoring a competition with ISL because it conflicted with the

15 dates of a previously scheduled FINA World Cup competition. (Case No. 18-cv-07394-JSC, Dkt.

16 No. 367-39.) Such a restraint is not obviously unreasonable. Also, as explained above, ISL is

17 able to sponsor competitions without cooperation from member federations, and since 2019

18 competition has increased and swimmers have earned more money from ISL and FINA. So, the

19 Court cannot conclude in the “twinkling of an eye” the restraint is unreasonable. Alston, 141 S.

20 Ct. at 2156 (cleaned up).

21 Further, the Supreme Court has recognized that in certain industries, such as sports

22 leagues, “horizontal restraints on competition are essential if the product is to be available at all”

23 and thus the rule of reason analysis applies. Bd. of Regents, 468 U.S. at 101; see O’Bannon, 802

24 F.3d at 1069; see also Am. Needle, 560 U.S. at 203 (“When restraints on competition are essential

25 if the product is to be available at all, per se rules of illegality are inapplicable, and instead the

26 restraint must be judged according to the flexible Rule of Reason.” (cleaned up)). FINA, of

27 course, is not exactly a sports league. But that distinction merely highlights the courts’ lack of

1 approach. Cf. Law v. Nat’l Collegiate Athletic Ass’n, 134 F.3d 1010, 1018–19 (10th Cir. 1998)

2 (“Board of Regents more generally concluded that because horizontal agreements are necessary

3 for sports competition, all horizontal agreements among NCAA members, even those as egregious

4 as price-fixing, should be subject to a rule of reason analysis.”).

5 For all the above reasons, and drawing all reasonable inferences from the evidence in

6 Plaintiffs’ and ISL’s favor, the record does not support application of per se or quick look

7 analysis; the default rule of reason applies.

8 3. Applying the Rule of Reason

9 The rule of reason has a threshold requirement “to accurately define the relevant market,

10 which refers to the area of effective competition.” Qualcomm, 969 F.3d at 992 (cleaned up); see

11 also Flaa v. Hollywood Foreign Press Ass’n, 55 F.4th 680, 693 (9th Cir. 2022) (“Under the rule of

12 reason, a plaintiff must allege that the defendant has market power within a relevant market. That

13 is, the plaintiff must allege both that a ‘relevant market’ exists and that the defendant has power

14 within that market” (cleaned up)). “Courts usually cannot properly apply the rule of reason

15 without an accurate definition of the relevant market. Otherwise, there is no way to measure the

16 defendant’s ability to lessen or destroy competition.” Qualcomm, 969 F.3d at 992 (cleaned up);

17 see also Amex, 138 S. Ct. at 2285 (“Because legal presumptions that rest on formalistic

18 distinctions rather than actual market realities are generally disfavored in antitrust law, courts

19 usually cannot properly apply the rule of reason without an accurate definition of the relevant

20 market” (cleaned up)). “A relevant antitrust market is bounded both by geography and product.

21 An antitrust market is geographically bounded by where sellers operate and where purchasers can

22 predictably turn for supplies.” Fed. Trade Comm’n v. Qualcomm Inc., 411 F. Supp. 3d 658, 683

23 (N.D. Cal. 2019) (cleaned up).

24 The boundaries of an antitrust product market are determined by the

reasonable interchangeability of use or the cross-elasticity of demand

25 between the product itself and substitutes for it. . . . Other practical

indicia of an antitrust product market include industry or public

26 recognition of the market and the product’s peculiar characteristics

and uses.

27

1 relevant markets . . . .”).

2 Once the relevant market is determined, the rule of reason uses a three-step burden-shifting

3 framework:

4 [T]he plaintiff has the initial burden to prove that the challenged

restraint has a substantial anticompetitive effect that harms consumers

5 in the relevant market. If the plaintiff carries its burden, then the

burden shifts to the defendant to show a procompetitive rationale for

6 the restraint. If the defendant makes this showing, then the burden

shifts back to the plaintiff to demonstrate that the procompetitive

7 efficiencies could be reasonably achieved through less

anticompetitive means.

8

9 PLS.Com, 32 F.4th at 834 (cleaned up). “The goal is to distinguish between restraints with

10 anticompetitive effect that are harmful to the consumer and restraints stimulating competition that

11 are in the consumer’s best interest.” Amex, 138 S. Ct. at 2284 (cleaned up).

12 a. The relevant antitrust market

13 FINA contends the evidence is insufficient to meet Plaintiffs’ and ISL’s threshold

14 requirement of defining a relevant market. See Ky. Speedway, LLC v. Nat’l Ass’n of Stock Car

15 Auto Racing, Inc., 588 F.3d 908, 916 (6th Cir. 2009) (noting the plaintiff’s burden); see also

16 Nissan Fire & Marine Ins. Co. v. Fritz Cos., Inc., 210 F.3d 1099, 1102 (9th Cir. 2000) (explaining

17 a defendant may move for summary judgment on the grounds “that the nonmoving party does not

18 have enough evidence of an essential element to carry its ultimate burden of persuasion at trial”).

19 The Court agrees.

20 Plaintiffs and ISL do not have a merits expert. Therefore, they offer no expert testimony

21 on either the geographic bounds of the market for top-tier international swimming competitions, or

22 the cross-elasticity of demand between that product and its substitutes. Without expert testimony,

23 the record does not have sufficient evidence from which a reasonable trier of fact could deduce

24 any relevant market. Are top-tier international swimming competitions interchangeable with

25 NCAA Division I swimming competitions, top-tier international sports, sports more broadly, or

26 entertainment more broadly? (See Dkt. No. 367-89 at 19–20; Dkt. No. 367-90 at 13–14, 36 (ISL

27 executives noting it competes with sports and entertainment generally)); cf. Sunday Ticket, 933

1 NFL games to be comparable to other sports or forms of entertainment)”). The record is simply

2 not developed.

3 Plaintiffs and ISL do not seriously dispute their lack of evidence as to the relevant market.

4 Instead, they contend such evidence is not required because they have identified sufficient

5 evidence of the direct anticompetitive effects of FINA’s unauthorized relations rule. Specifically,

6 they insist FINA blocked ISL from holding as many as three events in 2018 and thus there is a

7 genuine dispute as to anticompetitive effects. The Court is unpersuaded.

8 First, their argument is premised on their mantra that FINA’s rules prohibited top-tier

9 swimmers from participating in any unsanctioned swimming event. Not so. As discussed in the

10 context of the proper antitrust analysis, FINA’s rules prohibited its member federations from

11 affiliating with an unapproved entity, and a trier of fact could find that, for a brief time, FINA

12 threatened suspension of any swimmer who participated in an unsanctioned event involving a

13 FINA member federation. There is no rule (and never was) that allows FINA to penalize a

14 swimmer who participates in a competition that is not affiliated with a member federation, and no

15 evidence that FINA ever did, or even threatened to do so. To the contrary, ISL sponsored such a

16 competition in 2019 in Naples, Italy with “top-tier swimmers” participating, and ISL admits it

17 does not require FINA approval or federation affiliation to put on international swimming

18 competitions. As there is no evidence that in 2018 ISL even attempted to put on a swimming

19 competition without affiliating with a FINA-member federation, let alone evidence FINA stopped

20 it from doing so, the record does not support a finding that FINA’s refusal in 2018 to approve

21 ISL’s affiliation with a FINA-member federation so obviously had anticompetitive effects that

22 Plaintiffs and ISL have no need to define the relevant market.

23 Plaintiffs and ISL’s reliance on their damages expert, Dr. Rascher, is misplaced. They

24 contend his testimony supports an inference ISL would have put on more events in 2019 but for

25 FINA’s interference. Putting aside that he is a damages rather than merits expert, he

26 (unsurprisingly) provides no testimony that disputes the evidence ISL did not need FINA to

27 sponsor top-tier international swimming competitions.

1 under the first step of the rule of reason. See Qualcomm, 969 F.3d at 992 (“Furthermore, in

2 assessing alleged antitrust injuries, courts must focus on anticompetitive effects in the market

3 where competition is allegedly being restrained.” (cleaned up)). The direct evidence to which

4 Plaintiffs and ISL refer must “include[] proof of actual detrimental effects on competition, such as

5 reduced output, increased prices, or decreased quality in the relevant market.”4 Id. at 989 (cleaned

6 up; emphasis added); see PLS.Com, 32 F.4th at 834 (“To prove a substantial anticompetitive effect

7 directly, the plaintiff must provide proof of actual detrimental effects . . . in the relevant market.

8 When a plaintiff does so, no inquiry into market definition and market power is required.”

9 (cleaned up; emphasis added)); see also Intel Corp. v. Fortress Inv. Grp. LLC, 511 F. Supp. 3d

10 1006, 1014 (N.D. Cal. 2021) (“Market power is essentially a surrogate for detrimental effects. If a

11 plaintiff can make a showing of actual anticompetitive effects, then a full-blown market analysis is

12 not necessary.” (cleaned up)).

13 It is true that a horizontal restraint, like GR 4, may require a less precise definition of the

14 relevant market than another restraint. In Amex, the Supreme Court explained that defining the

15 relevant market is a requirement when the restraint at issue is vertical. 138 S. Ct. at 2285 n.7. It

16 distinguished Indiana Federation, 476 U.S. 447, and Catalano, Inc. v. Target Sales, Inc., 446 U.S.

17 643 (1980) (per curiam), on the basis that because the restraints at issue were horizontal, the court

18 “did not need to precisely define the relevant market to conclude that these agreements were

19 anticompetitive.” 138 S. Ct. at 2285 n.7. In Indiana Federation, the court found that although the

20 FTC “fail[ed] to engage in detailed market analysis,” there was evidence that:

21 in two localities in the State of Indiana (the Anderson and Lafayette

areas), Federation dentists constituted heavy majorities of the

22 practicing dentists and that as a result of the efforts of the Federation,

insurers in those areas were, over a period of years, actually unable to

23 obtain compliance with their requests for submission of x rays. . . .

[W]e conclude that the finding of actual, sustained adverse effects on

24 competition in those areas where IFD dentists predominated, viewed

in light of the reality that markets for dental services tend to be

25

26

4 The alternative, indirect evidence, “involves proof of market power plus some evidence that the

27 challenged restraint harms competition.” Qualcomm, 969 F.3d at 989 (cleaned up); see Amex, 138

relatively localized, is legally sufficient to support a finding that the

1 challenged restraint was unreasonable even in the absence of

elaborate market analysis.

2

3 476 U.S. at 460–61. Thus, in applying the rule of reason to a horizontal restraint, Indiana

4 Federation relied on evidence the conspiring entities were the majority of suppliers in two local

5 areas and that the product market was localized. Drawing all inferences in Plaintiffs’ and ISL’s

6 favor, they have not adduced enough evidence to meet that lesser burden here.

7 The Court acknowledges the record is replete with evidence of FINA’s concern about

8 competition from ISL. But, so what? The antitrust laws do not require one competitor to help

9 another compete with it; instead, they prohibit only unreasonable restraints of trade. Cf.

10 Qualcomm, 969 F.3d at 1005 (“Anticompetitive behavior is illegal under federal antitrust law.

11 Hypercompetitive behavior is not.”).

12 Because Plaintiffs and ISL have insufficient evidence to prove the relevant market, no

13 reasonable trier of fact could find FINA’s unauthorized relations rule violated the rule of reason.

14 See id. at 992. The Court need not analyze the third element of a Section 1 claim—the restraint’s

15 effect on interstate commerce—because there is insufficient evidence in the record to support the

16 second element. See Tanaka, 252 F.3d at 1062.

17 * * *

18 A reasonable trier of fact could find a contract, combination, or conspiracy existed among

19 FINA and its member federations. The trier of fact could also find that GR 4, the unauthorized

20 relations rule, was a horizontal restraint of trade. However, under the rule of reason, and based on

21 the record before the Court, no reasonable trier of fact could find the restraint was unreasonable

22 because Plaintiffs and ISL have not offered enough evidence to define the relevant market and

23 thus show the required anticompetitive effects. Accordingly, FINA is entitled to summary

24 judgment on Plaintiffs’ and ISL’s Section 1 claims. See id.

25 II. SHERMAN ACT SECTION 2

26 “Whereas § 1 of the Sherman Act targets concerted anticompetitive conduct, § 2 targets

27 independent anticompetitive conduct.” Qualcomm, 969 F.3d at 989–90. Section 2 “makes it

1 990. “To establish liability under § 2, a plaintiff must show: (a) the possession of monopoly [or

2 monopsony] power in the relevant market; (b) the willful acquisition or maintenance of that

3 power; and (c) causal antitrust injury.” Id. (cleaned up); see Weyerhaeuser Co. v. Ross–Simmons

4 Hardwood Lumber Co., Inc., 549 U.S. 312, 321–22 (2007) (noting similarities between monopoly

5 and monopsony). FINA moves for summary judgment on Plaintiffs’ and ISL’s Section 2 claims.

6 A. Monopoly & Monopsony Power

7 The first element requires proof of power “in the relevant market.” Qualcomm, 969 F.3d at

8 990. Thus, “[a]s the language of the first element makes clear, defining the relevant market is

9 indispensable to a monopolization claim.” Thurman Indus., Inc. v. Pay ‘N Pak Stores, Inc., 875

10 F.2d 1369, 1373 (9th Cir. 1989) (cleaned up); see Dreamstime.com, 54 F.4th at 1137. “Monopoly

11 power is the ability to control prices and exclude competition in a given market. If a firm can

12 profitably raise prices without causing competing firms to expand output and drive down prices,

13 that firm has monopoly power.” Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 307 (3d Cir.

14 2007).

15 As analyzed above, drawing all inferences in Plaintiffs’ and ISL’s favor, there is

16 insufficient evidence from which a reasonable trier of fact could deduce the bounds of a relevant

17 market. And there is insufficient evidence from which to draw a reasonable inference about which

18 products are interchangeable with FINA’s product, international swimming competitions. Cf.

19 United States v. Microsoft Corp. (“Microsoft”), 253 F.3d 34, 51–54 (D.C. Cir. 2001) (concluding,

20 on first element of Section 2 analysis, that the district properly defined the relevant market as “the

21 licensing of all Intel-compatible PC operating systems worldwide”).

22 Plaintiffs and ISL again contend no relevant market definition is required if they have

23 direct evidence of monopoly power. See Broadcom, 501 F.3d at 307 n.3; Microsoft, 253 F.3d at

24 51. That may not be a correct statement of current Ninth Circuit law. See Dreamstime.com, 54

25 F.4th at 1137 (“A Section 2 claim includes two elements: (1) the defendant has monopoly power

26 in the relevant market, and (2) the defendant has willfully acquired or maintained monopoly power

27 in that market. Both elements are required. . . . To meet the first element of a Section 2 claim, a

1 market share in that market sufficient to constitute monopoly power, and (3) show that there are

2 significant barriers to entering that market.” (cleaned up)). But the Court need not resolve that

3 legal question because Plaintiffs and ISL do not offer sufficient direct evidence of monopoly

4 power. Direct evidence of monopoly power is “restricted output and supracompetitive prices.”

5 Rebel Oil Co. v. Atl. Richfield Co., 51 F.3d 1421, 1434 (9th Cir. 1995) (citing Ind. Fed’n, 476 U.S.

6 at 460–61)). The former refers to the defendant’s power to restrict its own output in a way that

7 “restrict[s] marketwide output and, hence, increase[s] marketwide prices.” Id. The latter refers to

8 the defendant’s power to “raise prices without causing competing firms to expand output and drive

9 down prices.” Broadcom, 501 F.3d at 307. Plaintiffs’ and ISL’s evidence that FINA’s conduct

10 restricted ISL’s output is not proper direct evidence of monopoly power. And Plaintiffs and ISL

11 do not offer any evidence about FINA’s power to raise prices with respect to international

12 swimming competitions. Therefore, as a matter of law there is insufficient direct evidence of

13 monopoly power, and Plaintiffs and ISL retain the burden of defining the relevant market.

14 Because there is insufficient evidence from which a reasonable trier of fact could define

15 the relevant market, no reasonable trier of fact could find in Plaintiffs’ and ISL’s favor on the

16 monopoly and monopsony power element of their Section 2 claims. See Qualcomm, 969 F.3d at

17 990. Accordingly, FINA is entitled to summary judgment on the Section 2 claims. See Celotex

18 Corp. v. Catrett, 477 U.S. 317, 325 (1986).

19 * * *

20 The Court need not address antitrust injury, a matter of statutory standing for Section 1 and

21 2 claims, because Plaintiffs’ and ISL’s claims fail on other grounds. See PLS.Com, 32 F.4th at

22 833 (explaining elements of antitrust injury and noting “[w]ithout a violation of the antitrust laws,

23 there can be no antitrust injury” (cleaned up)); Hairston, 101 F.3d at 1318.

24 III. TORT CLAIMS

25 ISL makes a claim under California law for tortious interference with prospective

26 economic relations, while the named Plaintiff swimmers bring a California law claim for tortious

27 interference with contractual relations. FINA moves for summary judgment on both.

1 A. ISL’s Claim

2 ISL’s claim for tortious interference with prospective economic relations requires it to

3 prove: “(1) an economic relationship between the plaintiff and some third party, with the

4 probability of future economic benefit to the plaintiff; (2) the defendant’s knowledge of the

5 relationship”; (3) “intentional wrongful acts on the part of the defendant designed to disrupt the

6 relationship”; “(4) actual disruption of the relationship; and (5) economic harm to the plaintiff

7 proximately caused by the acts of the defendant.” Korea Supply Co. v. Lockheed Martin Corp., 63

8 P.3d 937, 950–51 (Cal. 2003) (cleaned up). The third element refers to acts that are “proscribed

9 by some constitutional, statutory, regulatory, common law, or other determinable legal standard.”

10 Id. at 954; see also id. at 953 (“[W]hile intentionally interfering with an existing contract is a

11 wrong in and of itself, intentionally interfering with a plaintiff’s prospective economic advantage

12 is not. To establish a claim for interference with prospective economic advantage, therefore, a

13 plaintiff must plead that the defendant engaged in an independently wrongful act.” (cleaned up)).

14 ISL uses its antitrust claims against FINA as the basis for the third element. That is, it

15 alleges FINA’s acts were wrong because they are proscribed by the Sherman Act. As explained

16 above, FINA is entitled to summary judgment on ISL’s Sherman Act claims in light of application

17 of the rule of reason and ISL’s failure to offer sufficient evidence on the relevant market and

18 related elements. Thus, those claims do not provide a basis for the third element of ISL’s tort

19 claim. FINA is entitled to judgment on this claim.

20 B. Plaintiffs’ Claims

21 Plaintiffs Shields, Andrew, and Hosszú make a claim under California law for intentional

22 interference with contractual relations arising from FINA’s interference with ISL’s planned Turin

23 event with the Italian Swimming Federation. (Dkt. No. 83 ¶ 175.) FINA argues the Court does

24 not have personal jurisdiction of this claim. The Court agrees.

25 At the motion to dismiss stage, the Court held Plaintiffs and ISL had made a prima facie

26 showing of nationwide specific personal jurisdiction over FINA as to their antitrust claims.

27 Shields, 419 F. Supp. 3d at 1201–13. FINA does not dispute that holding for purposes of its

1 proving personal jurisdiction over FINA for their intentional inference claim. See Picot v. Weston,

2 780 F.3d 1206, 1211 (9th Cir. 2015) (“When a plaintiff relies on specific jurisdiction, he must

3 establish that jurisdiction is proper for each claim asserted against a defendant.” (cleaned up)).

4 Plaintiffs must satisfy three requirements to show specific personal jurisdiction of this

5 claim: (1) FINA purposefully directed its activities toward the forum or purposefully availed itself

6 of the privileges of conducting activities in the forum; (2) Plaintiffs’ interference with contract

7 claim arises out of or relates to FINA’s forum-related activities; and (3) the Court’s exercise of

8 personal jurisdiction satisfies due process. See Axiom Foods, Inc. v. Acerchem Int’l, Inc., 874 F.3d

9 1064, 1068 (9th Cir. 2017).

10 When, as here, the claim sounds in tort, courts use the purposeful direction test to decide

11 personal jurisdiction. Under that test, the plaintiff must make a prima face showing the defendant

12 “(1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing harm that the

13 defendant knows is likely to be suffered in the forum state.” Id. at 1069 (cleaned up). As the issue

14 is presented on summary judgment, the Court will employ the same standard as governed the Rule

15 12(b)(2) motion following jurisdictional discovery: Plaintiffs must make a prima face showing of

16 personal jurisdiction and all reasonable inferences from the evidence in the record must be

17 resolved in Plaintiffs’ favor. See Shields, 419 F. Supp. 3d at 1201–02.

18 Drawing all reasonable inferences in Plaintiffs’ favor, the record supports a finding FINA

19 committed an intentional act by sending the October 2018 memo to all federation members.

20 Plaintiffs contend the memo interfered with their contracts to swim in the Turin competition

21 because it warned the member federations that ISL’s planned Turin event co-sponsored by the

22 Italian Swimming Federation in December 2018 was an international swimming competition,

23 FINA had not approved it, and that FINA would therefore consider the consequences flowing

24 from GR 4 (unauthorized relations).

25 The next question is whether Plaintiffs have shown FINA’s intentional acts were aimed at

26 the forum. Although Plaintiffs’ claim is brought under California law, FINA’s motion assumes,

27 without explanation, the “forum” in this analysis is the United States. (Dkt. No. 326-2 at 22–23;

1 nationwide contacts, see Go-Video, Inc. v. Akai Elec. Co., 885 F.2d 1406, 1417 (9th Cir. 1989),

2 the Court is not aware of any caselaw suggesting a California common law tort claim likewise has

3 such broad reach. See Mehr v. Féderation Internationale de Football Ass’n, 115 F. Supp. 3d

4 1035, 1049–53 (N.D. Cal. 2015) (holding the plaintiffs had not shown sufficient contacts with

5 California to establish specific jurisdiction for tort claims against an international soccer

6 association in California federal court). But given that is how FINA framed its motion, the Court

7 will evaluate whether Plaintiffs have established FINA’s intentional acts were aimed at the United

8 States. They have not.

9 First, Plaintiffs’ reliance on the Court’s earlier personal jurisdiction ruling is misplaced.

10 That Order considered Plaintiffs’ and ISL’s antitrust claims and concluded they had made a prima

11 facie showing of jurisdiction in the United States because of the evidence regarding FINA’s

12 concern about USA Swimming partnering with ISL to host an event in the United States. Shields,

13 419 F. Supp. 3d at 1203–06. While the evidence the Court cited in that Order might be admissible

14 on Plaintiffs’ interference with contract claim, it does not constitute the intentional acts upon

15 which the claim is based.

16 Second, Plaintiffs have not identified any other acts aimed at the United States designed to

17 scuttle the Turin event. They argue: “FINA ignores the evidence that its intentional campaign to

18 interfere with the swimmer plaintiffs’ contract with ISL began at least in early 2018.” (Dkt. No.

19 340-1 at 53.) Plaintiffs, however, do not cite any contracts they had with ISL in early 2018;

20 indeed, the contracts they allege FINA interfered with were executed in October 2018 at the

21 earliest and were limited to the Turin event, not some free-standing agreement with ISL. (Dkt.

22 Nos. 327-5, 327-9.) So, they have not made a prima face showing of purposeful direction at the

23 United States for this claim.

24 And, even if the Court considers the conduct aimed at the United States upon which the

25 Court relied in its earlier Order as satisfying Plaintiffs’ purposeful direction burden, the claims for

26 interference with the Turin-event contracts do not arise out of those contacts. At bottom, Plaintiffs

27 allege a Swiss entity interfered with their contracts with another Swiss entity to participate in a

1 Swimming was one of over 200 federations to receive the October 2018 memo threatening

2 sanctions if a federation’s swimmers participated in the event does not come close to showing that

3 each swimmer’s claim arises from FINA’s contacts with the United States. Drawing all

4 reasonable inferences in Plaintiffs’ favor, their contracts were interfered with because the Italian

5 Swimming Federation cancelled the event due to—according to Plaintiffs—FINA’s pressure.

6 This conduct is not connected to the United States. Plaintiffs have not met their burden to show

7 the Court has personal jurisdiction of the intentional interference with contract claim.

8 * * *

9 Accordingly, FINA is entitled to summary judgment on the California tort claims.

10 IV. SEALING

11 There is a presumption of public access to judicial records and documents. Nixon v.

12 Warner Commc’ns, Inc., 435 U.S. 589, 597 (1978). Courts generally apply a “compelling

13 reasons” standard when considering motions to seal, recognizing that “a strong presumption in

14 favor of access is the starting point.” Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178

15 (9th Cir. 2006) (cleaned up). Courts have found compelling reasons to seal information about a

16 party or non-party’s personal finances or a business’s budget and development planning. See

17 Brown v. Brown, No. CV 13-03318 SI, 2013 WL 12400041, at *1 (N.D. Cal. Dec. 30, 2013);

18 Space Data Corp. v. X, No. 16-cv-03260-BLF, 2017 WL 11503233, at *2 (N.D. Cal. Sept. 25,

19 2017). But “[t]he mere fact that the production of records may lead to a litigant’s embarrassment,

20 incrimination, or exposure to further litigation will not, without more, compel the court to seal its

21 records.” Kamakana, 447 F.3d at 1179.

22 Civil Local Rule 79-5 supplements the “compelling reasons” standard. Exeltis USA Inc. v.

23 First Databank, Inc., No. 17-cv-04810-HSG, 2020 WL 2838812, at *1 (N.D. Cal. June 1, 2020).

24 “Reference to a stipulation or protective order that allows a party to designate certain documents

25 as confidential is not sufficient to establish that a document, or portions thereof, are sealable.”

26 N.D. Cal. Civ. L.R. 79-5(c).

27 For any document a party (“Filing Party”) seeks to seal because that

filing an Administrative Motion to File Under Seal, file an

1 Administrative Motion to Consider Whether Another Party’s Material

Should Be Sealed.

2 . . .

(3) Within 7 days of the motion’s filing, the Designating Party must

3 file a statement and/or declaration . . . . A failure to file a statement

or declaration may result in the unsealing of the provisionally sealed

4 document without further notice to the Designating Party.

5 Id. at 79-5(f).

6 Applying those principles, the Court DENIES in part the parties’ administrative motions to

7 file under seal, (Dkt. Nos. 317, 318, 320, 326, 327, 333, 334, 337, 340, 346, 347, 351, 352; Case

8 No. 18-cv-07394-JSC, Dkt. Nos. 360, 361, 363, 368, 370, 377, 383, 384, 387, 390, 393, 399, 400,

9 408, 409), as follows:

10

Document Disposition Reason

11

Dkt. No. 317. Not sealable. ISL did not submit the statement or

12 declaration required by N.D. Cal. Civ.

L.R. 79-5(f).

13 Dkt. No. 318. Not sealable. Plaintiffs did not submit the statement

or declaration required by Civ. L.R.

14 79-5(f).

Dkt. No. 320. Not sealable. FINA and USA Swimming did not

15

submit the statement or declaration

16 required by Civ. L.R. 79-5(f).

Dkt. No. 326. Not sealable. ISL did not submit the statement or

17 declaration required by Civ. L.R. 79-

5(f).

18

Dkt. No. 327. Not sealable. Plaintiffs did not submit the statement

19 or declaration required by Civ. L.R.

79-5(f).

20 Dkt. No. 333. Not sealable. Plaintiffs did not submit the statement

or declaration required by Civ. L.R.

21 79-5(f).

Dkt. No. 334. Not sealable. ISL did not submit the statement or

22

declaration required by Civ. L.R. 79-

23 5(f).

Dkt. No. 337. Not sealable. FINA did not submit the statement or

24 declaration required by Civ. L.R. 79-

5(f).

25

Dkt. No. 340. Not sealable. FINA, USA Swimming, and

26 Wasserman did not submit the

statement or declaration required by

27 Civ. L.R. 79-5(f).

Dkt. No. 346. Not sealable. ISL did not submit the statement or

5(f).

1

Dkt. No. 347. Not sealable. Plaintiffs did not submit the statement

2 or declaration required by Civ. L.R.

79-5(f).

3 Dkt. No. 351. Not sealable. FINA did not submit the statement or

declaration required by Civ. L.R. 79-

4 5(f).

Dkt. No. 352. Not sealable. USA Swimming did not submit the

5

statement or declaration required by

6 Civ. L.R. 79-5(f).

Case No. 18-cv-07394-JSC, Pending further ISL submitted a statement at Case No.

7 Dkt. Nos. 360, 361. submission by ISL. 18-cv-07394-JSC, Dkt. No. 372.

Within 5 days of this Order, ISL

8

shall submit an updated version of

9 the statement that cites to the ECF

Docket Nos. of the documents it

10 wishes to seal on the basis that they

contain sponsorship agreements with

11 third parties.

Case No. 18-cv-07394-JSC, Not sealable. Plaintiffs did not submit the statement

12

Dkt. No. 363. or declaration required by Civ. L.R.

13 79-5(f).

Case No. 18-cv-07394-JSC, Not sealable. ISL does not object. (Case No. 18-cv-

14 Dkt. No. 368. 07394-JSC, Dkt. No. 372 at 3.)

Case No. 18-cv-07394-JSC, Not sealable. FINA and USA Swimming did not

15 Dkt. No. 370. submit the statement or declaration

required by Civ. L.R. 79-5(f).

16

Case No. 18-cv-07394-JSC, Not sealable. FINA and USA Swimming did not

17 Dkt. No. 377. submit the statement or declaration

required by Civ. L.R. 79-5(f).

18 Case No. 18-cv-07394-JSC, Not sealable. ISL did not submit the statement or

Dkt. No. 383. declaration required by Civ. L.R. 79-

19

5(f).

20 Case No. 18-cv-07394-JSC, Not sealable. Plaintiffs did not submit the statement

Dkt. No. 384. or declaration required by Civ. L.R.

21 79-5(f).

Case No. 18-cv-07394-JSC, Not sealable. FINA did not submit the statement or

22 Dkt. No. 387. declaration required by Civ. L.R. 79-

5(f).

23

Case No. 18-cv-07394-JSC, Not sealable. FINA did not submit the statement or

24 Dkt. No. 390. declaration required by Civ. L.R. 79-

5(f).

25 Case No. 18-cv-07394-JSC, Not sealable. FINA, USA Swimming, and

Dkt. No. 393. Wasserman did not submit the

26

statement or declaration required by

27 Civ. L.R. 79-5(f).

Case No. 18-cv-07394-JSC, Not sealable. ISL did not submit the statement or

| Case No. 18-cv-07394-JSC, Not sealable. Plaintiffs did not submit the statement

2 Dkt. No. 400. or declaration required by Civ. L.R.

79-5(f).

3 Case No. 18-cv-07394-JSC, Not sealable. USA Swimming did not submit the

Dkt. No. 408. statement or declaration required by

4 Civ. L.R. 79-5(f).

5 Case No. 18-cv-07394-JSC, Not sealable. FINA did not submit the statement or

Dkt. No. 409. declaration required by Civ. L.R. 79-

6 5(f).

7 With respect to the material determined not sealable, unless the designating party files a

8 || renewed motion to seal within 5 days of the date of this Order the Court will unlock the prior

9 docket entries so the material previously filed under seal is available on the public docket. See

10 || N.D. Cal. Civ. L.R. 79-5(f), 79-5(g)(2). A party may file a notice on the docket if the disposition

11 above omits any document for which an administrative motion to seal was filed.

12 CONCLUSION

& 13 FINA’s motions for summary judgment are GRANTED. Plaintiffs’ and ISL’s joint motion

14 || for summary judgment is accordingly DENIED. FINA’s Daubert motions and motion to strike are

15 DENIED as moot.

A 16 This Order disposes of Docket Nos. 316, 317, 318, 320, 321, 325, 326, 327, 333, 334, 337,

2 17 340, 346, 347, 351, 352 in Case No. 18-cv-07393-JSC and Docket Nos. 355, 356, 357, 358, 359,

2 18 || 363, 364, 368, 370, 371, 377, 383, 384, 387, 390, 393, 399, 408, 409 in Case No. 18-cv-07394-

19 JSC.

20 IT IS SO ORDERED.

21 Dated: January 6, 2023

3)

23 me

JACQUELINE SCOTT CORLE

24 United States District Judge

25

26

27

28