Oliver v. American Express Company

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

ANTHONY OLIVER, TERRY GAYLE AMENDED MEMORANDUM & ORDER

QUINTON, SHAWN O’KEEFE,

19-CV-00566 (NGG) (SJB)

ANDREW AMEND, SUSAN BURDETTE,

GIANNA VALDES, DAVID

MOSKOWITZ, ZACHARY DRAPER,

NATE THAYER and MICHAEL

THOMAS REID on behalf of themselves

and all other similarly situated,

Plaintiffs,

-against-

AMERICAN EXPRESS COMPANY and

AMERICAN EXPRESS TRAVEL

RELATED SERVICES COMPANY, INC.,

Defendants.

NICHOLAS G. GARAUFIS, United States District Judge.

This is a putative class action brought against Defendants Amer-

ican Express Company and American Express Travel Related

Services Company, Inc. (together, “Amex”). Plaintiffs, consumers

who made purchases using non-Amex electronic forms of pay-

ment, challenge the non-discrimination provisions contained in

Amex’s contracts with merchants who accept its credit cards (the

“Anti-Steering Rules”). (Compl. (Dkt. 1) ¶ 1.) On April 30, 2020,

the court granted Amex’s motion to dismiss Plaintiffs’ federal an-

titrust claims, and granted in part and denied in part Amex’s

motion to dismiss Plaintiffs’ state antitrust and consumer protec-

tion claims. See Oliver v. Am. Exp. Co., No. 19-cv-566 (NGG),

2020 WL 2079510, at *19-20 (E.D.N.Y. Apr. 30, 2020). Now be-

fore the court is Amex’s motion for partial judgment on the

pleadings as to certain of Plaintiffs’ remaining state law claims

pursuant to Federal Rule of Civil Procedure 12(c). (See Mot. for

Part. J. on Pleadings (“Mot.”) (Dkt. 58).) For the following rea-

sons, Amex’s motion is GRANTED IN PART AND DENIED IN

PART.1

BACKGROUND

The court assumes familiarity with the facts and history of this

case, which are described in detail in its April 30, 2020 memo-

randum and order (the “April M&O”). See Oliver, 2020 WL

2079510, at *1-4. Plaintiffs in this case challenge Amex’s Anti-

Steering Rules, which prevent merchants who accept Amex cards

from encouraging customers to use non-Amex cards, even where

another card is less expensive for the merchant to accept. Plain-

tiffs argue that the Anti-Steering Rules decrease competition in

the fees charged to merchants by Amex, Visa, Mastercard, and

Discover, and result in higher fees charged to merchants by the

non-Amex companies. Those higher fees, in turn, encourage mer-

chants to pass on the costs by charging higher prices to

consumers.

In its April M&O, the court first dismissed Plaintiffs’ claims under

Section 16 of the Clayton Act, 15 U.S.C. § 26. Oliver, 2020 WL

2079510, at *8. Applying the factors articulated in Associated

Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters

(“AGC”), 459 U.S. 519, 535 (1983) (the “AGC factors”), the court

held that Plaintiffs were not “efficient enforcers of the antitrust

law” and therefore lacked standing to pursue their federal anti-

trust claims. Id. at *8-12. Second, turning to Plaintiffs’ state law

antitrust claims, the court held that California, Nevada, New

Mexico, and New York all apply the AGC factors to determine

1 This Memorandum & Order amends the court’s previous Memorandum

& Order, issued on January 25, 2021, to clarify aspects of the court’s ruling

identified in the parties’ letter of January 27, 2021. (See Jan. 25, 2021

Mem. & Order (Dkt. 63); Letter re Parties’ Request for Clarification on

12(c) Ruling (Dkt. 64).)

standing under their state antitrust laws; accordingly, the court

granted Amex’s motion to dismiss Plaintiffs’ claims under the an-

titrust laws of those states. Id. at *13-16. Third, the court granted

Amex’s motion to dismiss Plaintiffs’ consumer protection claims

under the laws of California, Florida, and New Mexico. Id. at *17-

19. Finally, the court granted Amex’s motion to dismiss Plaintiffs’

unjust enrichment claim under New York law. Id. at *19.

Following the April M&O, Plaintiffs’ remaining claims arise under

the antitrust laws of twenty-four states and the consumer protec-

tion laws of eight states. Amex now moves for judgment on the

pleadings with respect to Plaintiffs’ claims under the state anti-

trust laws of sixteen jurisdictions: Arizona, Illinois, Iowa, Maine,

Maryland, Michigan, Minnesota, Nebraska, New Hampshire,

North Dakota, Rhode Island, South Dakota, Tennessee, Utah,

Wisconsin, and the District of Columbia. (Amex Mem. in Supp.

of Mot. for Part. J. on Pleadings (“Mem.”) (Dkt. 59) at 1-2.) Plain-

tiffs concede the motion as to their claims under the antitrust

laws of Iowa and Nebraska, but oppose Amex’s motion as to their

antitrust claims under the laws of the other fourteen jurisdic-

tions. (Pls.’ Mem. in Opp. to Mot. (“Opp.”) (Dkt. 60) at 1.) Amex

also moves for judgment on the pleadings with respect to Plain-

tiffs’ claims under the consumer protection laws of five

jurisdictions: Illinois, Massachusetts, Montana, Ohio, and the

District of Columbia. (Mem. at 3.) Plaintiffs concede the motion

as to their claims under the consumer protection laws of the Dis-

trict of Columbia, and Defendants concede that Plaintiffs may

pursue their claims under the consumer protection laws of Ohio

and Montana. (Opp. at 1 n.1; Reply (Dkt. 67) at 1 n.1.) Plaintiffs

oppose Amex’s motion as to their consumer protection laws of

Illinois and Massachusetts. (Opp. at 1.)

LEGAL STANDARD

In deciding a Rule 12(c) motion for judgment on the pleadings,

the court employs “the same standard as that applicable to a mo-

tion under Rule 12(b)(6), accepting the allegations contained in

the [nonmovant's pleading] as true and drawing all reasonable

inferences in favor of the nonmoving party.” Burnette v. Caroth-

ers, 192 F.3d 52, 56 (2d Cir. 1999). Thus, to withstand a motion

to dismiss or for judgment on the pleadings, a complaint “must

contain sufficient factual matter, accepted as true, to ‘state a

claim to relief that is plausible on its face.’”Ashcroft v. Iqbal, 556

U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550

U.S. 544, 570 (2007)). As with a Rule 12(b)(6) motion, the court

assumes facts alleged in the complaint are true and draws all rea-

sonable inferences in the nonmovant's favor. See Harris v. Mills,

572 F.3d 66, 71 (2d Cir. 2009).

DISCUSSION

A. State Antitrust Claims

Under the court’s prior M&O, Plaintiffs lack standing to assert

claims under the antitrust laws of any states that apply the AGC

factors. The parties dispute whether the laws of the following ten

jurisdictions apply the AGC factors: Illinois, Maine, Maryland,

Michigan, New Hampshire, Rhode Island, South Dakota, Utah,

Wisconsin, and the District of Columbia. Amex argues that Plain-

tiffs’ claims under the antitrust laws of Illinois, Michigan, and the

District of Columbia also fail, even if the court finds that those

jurisdictions do not apply the AGC factors. Finally, Amex argues

that Plaintiffs’ claims under the antitrust laws of Arizona, Minne-

sota, North Dakota, and Tennessee likewise fail for independent

reasons. The court addresses each of these jurisdictions below.

1. Illinois

In support of its argument that Illinois courts would apply the

AGC factors to claims under Illinois’ antitrust law, Amex relies on

an Illinois Appellate Court decision that cites approvingly to AGC

and various federal court decisions. See Cnty. of Cook v. Phillip

Morris, Inc., 817 N.E.2d 1039, 1045-46 (Ill. App. Ct. 2004); see

also, e.g., O’Regan v. Arb. Fs., Inc., 121 F.3d 1060, 1066 (7th Cir.

1997) (“Federal antitrust standing rules apply under the Illinois

Antitrust Act”); United States ex rel. Blaum v. Triad Isotopes, Inc.,

104 F. Supp. 3d 901, 930 (N.D. Ill. 2015) (“[T]he [c]ourt sees

no reason why the Illinois Supreme Court would not follow

AGC”). Plaintiffs do not provide contrary state authority, but in-

stead argue that Cnty. of Cook “speaks only to general notions of

remoteness or proximate cause, which, although consistent with

AGC, are more expansive concepts than AGC’s five carefully de-

lineated factors.” (Opp. at 6 (quoting In re Lithium Ion Batteries

Antitrust Litig., No. 13-md-2420 (YGR), 2014 WL 4955377, at *9

(N.D. Cal. Oct. 2, 2014)). While Plaintiffs are correct that Cnty.

of Cook discussed issues beyond the AGC factors, it nonetheless

cited to AGC approvingly and specifically emphasized the direct-

ness factor, which is particularly relevant in this case. In light of

that reliance on AGC by an Illinois appellate court, as well as

Plaintiffs’ failure to present contrary authority from Illinois

courts, the court joins the Seventh Circuit and courts in the

Northern District of Illinois in holding that Illinois would apply

the AGC factors to claims brought under its antitrust statute. Ac-

cordingly, Amex’s motion for judgment on the pleadings is

granted with respect to Plaintiffs’ claims under Illinois’ antitrust

law.

2. Maine

Amex cites a state trial court opinion for the proposition that the

AGC factors apply under Maine law. See Knowles v. Visa U.S.A.,

Inc., No. Civ.A.CV-03-707, 2004 WL 2475284, at *5 (Me. Super.

Oct. 20, 2004). In Knowles, the court explained that “[it] is prob-

able that the Maine Law Court . . . would look to the [AGC]

factors in determining standing under Maine’s antitrust laws and

would apply those factors except to the extent those factors can-

not be reconciled with the legislature’s adoption of the Illinois

Brick repealer.” Id. However, in In re Keurig Green Mountain Sin-

gle-Serve Coffee Antitrust Litig., 383 F. Supp. 3d 187 (S.D.N.Y.

2019) (“Keurig”), Judge Broderick reasoned that “a complete

reading of Knowles makes apparent that its application of AGC is

not in lockstep with federal precedents,” noting that Knowles

held, in light of Maine’s Illinois Brick repealer statute, that the

directness or remoteness of the asserted injury factor under AGC

“should be disregarded entirely in any inquiry as to standing un-

der Maine’s antitrust laws.” Keurig, 383 F. Supp. 3d at 259

(quoting Knowles, 2004 WL 2475284, at *6). While Amex cor-

rectly notes that the Maine Supreme Court has held that Maine

generally looks to federal antitrust law to construe its antitrust

statute, see McKinnon v. Honeywell Int’l, Inc., 977 A.D.2d 420, 426

(2009), the court agrees with Keurig that it is “unable to conclude

that the highest court in Maine would apply AGC” to Plaintiffs’

claims because of the distinction between the two standards ar-

ticulated in Knowles. Keurig, 383 F. Supp. 3d at 260. Accordingly,

Amex’s motion for judgment on the pleadings as to Plaintiffs’

claims under Maine’s antitrust law is denied.

3. Maryland

Amex primarily relies on a Maryland appellate court decision and

a Maryland federal district court decision to argue that Maryland

state courts would apply the AGC factors under Maryland’s anti-

trust laws. See Waldorf Shopping Mall, Inc. v. Great Atl. & Pac. Tea

Co., No. 82-46, 1984 WL 15690 (Md. Cir. Ct. Feb. 16, 1984);

havePOWER, LLC v. Gen. Elec. Co., 183 F. Supp. 2d 779 (D. Md.

2002). Plaintiffs argue that neither case is indicative of whether

Maryland state courts would apply the AGC factors because both

were decided before Maryland enacted its Illinois Brick repealer

statute in 2017 and because “Maryland’s harmonization provi-

sion merely directs that courts ‘be guided by’ federal courts’

interpretation of federal antitrust laws, so does not support the

contention that Maryland’s highest court would adopt AGC even

as the Maryland legislature has now expressly granted indirect

purchasers standing to sue.” (Opp. at 7.)

To be sure, as the court has previously explained, “[a] harmoni-

zation provision in a state’s antitrust state does not require a

state’s Supreme Court to find that state antitrust law must be an-

alyzed under the federal standard.” Oliver, 2020 WL 2079510, at

*16. However, Maryland courts have gone further to describe

section 4 of the Sherman Act as “[a]n analogous civil enforce-

ment provision under the federal antitrust laws” to Maryland’s

antitrust statute. State v. Jonathan Logan, Inc., 301 Md. 63, 67-

68 (1984); see also In re Mid-Atlantic Toyota Antitrust Litig., 541

F. Supp. 62, 64 (1981) (describing section 4 of the Sherman Act

as “comparable” to Maryland’s antitrust law). The view of Mary-

land’s antitrust statute as comparable to its federal analogue,

coupled with the state’s harmonization provision and the Mary-

land decision in Waldorf Shopping Mall, suggests that Maryland

courts would apply the AGC factors to claims brought under Mar-

yland’s antitrust law. See havePOWER, LLC, 183 F. at 785-86 (D.

Md. 2002). Plaintiffs’ argument that the legislature’s adoption of

an Illionis Brick repealer, without more, demonstrates that Mar-

yland courts would not apply the AGC factors is unconvincing.

Accordingly, Amex’s motion for judgment on the pleadings is

granted as to Plaintiffs’ claims under Maryland’s antitrust law.

4. Michigan

Amex cites a Michigan appellate court case, see Stark v. Visa

U.S.A. Inc., 2004 WL 1879003, at *4-5 (Mich. Cir. Ct. 2004), as

well as numerous federal court decisions, to argue that Michigan

state courts would apply the AGC factors to claims brought under

Michigan’s antitrust law. (Mem. at 9 (citing Keurig, 383 F. Supp.

at 260; Energy Conversion Devices Liquidation Tr. ex rel. Madden

v. Trina Solar Ltd., No. 13-cv-14241, 2014 WL 5511517, at *7

(E.D. Mich. Oct. 31, 2014), aff’d sub nom. Energy Conversion De-

vices Liquidation Tr. v. Trina Solar Ltd., 833 F.3d 680 (6th Cir.

2016)).) While Plaintiffs point to multiple federal court decisions

that decline to apply the AGC factors to Michigan antitrust law,

they fail to provide any Michigan state law contrary to Stark,

which explicitly rejected the argument that Michigan’s Illinois

Brick repealer “also eliminated the [AGC] standing require-

ments.” Stark, 2004 WL 1879003, at *4; see also Keurig, 383 F.

Supp. 3d at 260 (“The Stark . . . cour[t] analyzed the relevant

statutory language and case law and concluded that the AGC fac-

tors should apply to the antirust standing determination.”).

Because Stark provides the clearest indication of how Michigan

courts would apply Michigan law, the court finds that Michigan

would apply the AGC factors. Accordingly, Amex’s motion for

judgment on the pleadings is granted as to Plaintiffs’ claims un-

der Michigan’s antitrust law.

5. New Hampshire

Amex relies on two federal court decisions that held that New

Hampshire courts would apply the AGC factors to claims brought

under New Hampshire’s antitrust statute. See In re Refrigerant

Compressors Antitrust Litig., No. 2:09-md-2042, 2013 WL

1431756, at *10 (E.D. Mich. Apr. 9, 2013); Donovan v. Digit.

Equip. Corp., 883 F. Supp. 775, 785 (D.N.H. 1994). Plaintiffs

counter that the most recent federal court decision to consider

whether New Hampshire would apply the AGC factors deter-

mined that it would not. See Jones v. Micron Tech. Inc., 400 F.

Supp. 3d 897, 914 (N.D. Cal. 2019). In re Refrigerant’s analysis is

quite limited; there, the court applied the AGC factors to claims

under New Hampshire law because it had a harmonization pro-

vision. 2013 WL 1431756, at *10. However, as the court has

previously explained, “[a] harmonization provision in a state’s

antitrust state does not require a state’s Supreme Court to find

that state antitrust law must be analyzed under the federal stand-

ard” especially when “the harmonization provision finds that

federal law is merely persuasive.” Oliver, 2020 WL 2079510, at

*16. New Hampshire has one such “permissive” harmonization

provision2, and therefore In re Refrigerant’s analysis is not per-

suasive on this point.

However, in Minuteman, LLC v. Microsoft Corp., 147 N.H. 634,

639 (2002), the New Hampshire Supreme Court expressly

adopted the Illinois Brick rule against indirect purchaser suits,

holding that “it is sound to limit antitrust lawsuits to direct pur-

chasers.” See also LaChance v. U.S. Smokeless Tobacco Co., 156

N.H. 88, 93 (2007) (“We have held . . . that indirect purchasers

may not bring claims under the state antitrust statute.”). Plain-

tiffs, who are non-Amex cardholders, are not direct purchasers.

Accordingly, they lack standing under Minuteman, and Amex’s

motion for judgment on the pleadings is granted as to Plaintiffs’

claims under New Hampshire’s antitrust law. See Keurig, 383 F.

Supp. at 263-64.

6. Rhode Island

The court agrees with Amex that Rhode Island courts would ap-

ply the AGC factors to claims brought under Rhode Island’s

antitrust laws. Unlike other states that have permissive harmoni-

zation statutes, Rhode Island’s Supreme Court has held that “the

Rhode Island Antitrust Act must be construed in harmony with

judicial interpretations of comparable federal antitrust statutes

insofar as practical, except where provisions of this chapter are

expressly contrary to applicable federal provisions as construed.”

2 See N.H. Rev. Stat. Ann. § 356:14 (“In any action or prosecution under

this chapter, the courts may be guided by interpretations of the United

States’ antitrust laws.”).

See ERI Max Enterm’t, Inc. v. Streisand, 690 A.3d 1351, 1335 n.1

(1997). Plaintiffs have not offered a compelling reason why this

court is not bound by that instruction, and the court joins other

federal courts to apply federal antitrust standing analysis to a

state antitrust claim under Rhode Island law. See, e.g., Steward

Care Sy., LLC v. Blue Cross & Blue Shield of R.I., 997 F. Supp. 2d

142, 157 (D.R.I. 2014). Accordingly, Amex’s motion for judg-

ment on the pleadings is granted as to Plaintiffs’ claims under

Rhode Island’s antitrust law.

7. South Dakota

The parties cite competing federal district court decisions both

applying and declining to apply the AGC factors to claims brought

under South Dakota’s antitrust laws. Compare Keurig, 383 F.

Supp. 3d at 261 (applying AGC) and In re Dynamic Random Ac-

cess Memory (Dram) Antitrust Litig., 516 F. Supp. 2d 1072, 1095

(N.D. Cal. 2007) (same) with In re Flash Memory Antitrust Litig.,

643 F. Supp. 2d 1133, 1151-53 (N.D. Cal. 2009) (declining to

apply AGC) and In re TFT-LCD (Flat Panel) Antitrust Litig., 586 F.

Supp. 2d 1109, 1123 (same). The court finds Amex’s argument

more persuasive. First, as Amex notes, the South Dakota Su-

preme Court has held that “great weight should be given to the

federal cases interpreting the federal [antitrust] statute.” Byre v.

City of Chamberlain, 362 N.W.2d 69, 74 (S.D. 1985). Second, as

the court in Keurig explained, there is precedent from a South

Dakota trial court applying the AGC factors to dismiss antitrust

claims under South Dakota law. See Keurig, 383 F. Supp. 3d at

261 (citing Cornelison v. Visa U.S.A., Inc., No. 13-cv-1350 (S.D.

Cir. Ct. Sept. 28, 2004)). Taken together, Byre and Cornelison

suggest that South Dakota would apply the AGC factors. Accord-

ingly, Amex’s motion for judgment on the pleadings is granted as

to Plaintiffs’ claims under South Dakota’s antirust law.

8. Utah

Amex relies on Utah’s harmonization provision and a single fed-

eral district court case to argue that Utah courts would apply the

AGC factors to claims brought under Utah’s antitrust statute. See

Utah Code Ann. § 76-10-3118 (“The Legislature intends that the

courts, in construing this act, will be guided by interpretations

given by the federal courts to comparable federal antitrust stat-

utes and by other state courts to comparable state antitrust

statutes”); TravelPass Grp., LCC v. Caesars Ent. Corp., No. 5:18-

cv-153 (RWS) (CMC), 2019 WL 5691996, at *8 n.10 (E.D. Tex.

Aug. 29, 2019), report and recommendation adopted, 2019 WL

4727425 (E.D. Tex. Sept. 27, 2019). Utah’s harmonization pro-

vision, however, is permissive and the TravelPass court’s analysis

does not engage with whether Utah courts would apply the AGC

factors; instead, it simply notes that the Utah statute is identical

to the Sherman Antitrust Act. Without more, the court cannot say

that Utah courts would apply the AGC factors to claims brought

under Utah’s antitrust statute. Accordingly, Amex’s motion for

judgment on the pleadings is denied as to Plaintiffs’ claims under

Utah’s antitrust law.

9. District of Columbia

The parties cite competing D.C. Superior Court decisions to sup-

port their respective positions about whether the AGC factors

apply to Plaintiffs’ District of Columbia antitrust claim. Compare

Peterson v. Visa U.S.A.. Inc., No. Civ A. 03-8080, 2005 WL

1403761 (D.C. Super. Ct. Apr. 22, 2005) (applying AGC factors

to claim under D.C. antitrust statute) with Holder v. Archer Dan-

iels Midland Co., No. 96-2975, 1998 WL 1469620, at *5 (D.C.

Super. Ct. Nov. 4, 1998) (holding that indirect purchasers had

antitrust standing under the D.C. antitrust statute without apply-

ing the AGC factors). Amex’s argument that Holder “concerned

only whether the Illinois Brick rule applied to claims under the

D.C. antitrust law,” (Reply at 7), fails to address Holder’s explicit

holding that the D.C. antitrust statue “was passed to distinguish

D.C. antitrust law from federal law with respect to standing for

indirect purchasers.” Holder, 1998 WL 1469620, at *3 n.4. More-

over, Amex also fails to provide further authority as to why

Peterson, and not Holder, is controlling. See Keurig, 383 F. Supp.

3d at 258 (“Absent a pronouncement from the D.C. Court of Ap-

peals or more trial court decisions definitively pointing in one

decisional direction or another, there is no apparent reason to

consider Peterson as more authoritative than Holder.”); see also

Los Gatos Mercantile, Inc. v. E.I. DuPont De Nemours and Co., No.

13-cv-1180 (BLF), 2015 WL 4755335, at *19 (N.D. Cal. Aug. 11,

2015). Accordingly, Amex’s motion for judgment on the plead-

ings with respect to Plaintiffs’ claims under D.C.’s antitrust law is

denied.

10. Wisconsin

Amex cites to a Wisconsin trial court decision, Strang v. Visa

U.S.A., Inc., No. 03-cv-11323, 2005 WL 1403769, at *2-5 (Wis.

Cir. Ct. Feb. 8, 2005), to support its claim that Wisconsin courts

would apply the AGC factors to claims brought under Wisconsin’s

antitrust law. See also In re G-Fees Antitrust Litig., 584 F. Supp.

2d 26, 41-42 (D.D.C. 2008) (relying on Strang to find that Wis-

consin courts would apply the AGC factors to claims under

Wisconsin’s antitrust statute). Plaintiffs argue that Strang is not

persuasive because it failed to properly consider the Wisconsin

Court of Appeals’ decision in Obstetrical & Gynecological Assocs.

of Neenah, S.C. v. Landig, 384 N.W.2d 719 (Wis. Ct. App. 1986).

Landig, however, concerned a separate provision of Wisconsin’s

antitrust law and did not discuss AGC, instead analyzing whether

a separate “target area” test applied to the claims at bar. See Lan-

dig, 384 N.W.2d at 721-24. Strang, decided two decades after

Landig, gives a reasoned analysis for why the AGC factors apply,

and the court sees no reason to doubt that other Wisconsin courts

would follow suit. Accordingly, Amex’s motion for judgment on

the pleadings with respect to Plaintiffs’ claims under Wisconsin’s

antitrust law is granted.

11. Minnesota

Amex concedes that the AGC factors do not apply to claims under

Minnesota’s antitrust statute. (Mem. at 13.) However, Amex ar-

gues that Plaintiffs’ claims are nonetheless too attenuated to

survive under the Minnesota Supreme Court’s decision in Lorix v.

Crompton Corp., 736 N.W.2d 619, 627 (Minn. 2007). (Id.) In Lo-

rix, the court declined to apply the AGC factors to claims under

Minnesota’s antitrust law and noted that “the Minnesota antitrust

law contains an expansive grant of standing designed to protect

Minnesota citizens from sharp commercial practices.” Lorix, 736

N.W.2d at 627. Nonetheless, the court explained that “[s]tanding

under Minnesota antitrust law must be defined by some pruden-

tial limits informed by foreseeability, proximate cause,

remoteness, and relation of the injury to the purposes of the an-

titrust law.” Id. at 631. As an example of a claim that would not

meet this prudential limitation, the court cited to Gutzwiller v.

Visa U.SA., Inc., No. C4-04-58, 2014 WL 2114991, at *5-9 (Minn.

Dist. Ct. Sept. 15, 2004). That case involved claims on behalf of

plaintiff consumers against Visa and Mastercard who argued that

“the overcharges forced upon merchants by Visa and Mastercard

were passed on to consumers in the form of higher prices on es-

sentially every good sold in the state of Minnesota.” Lorix, 736

N.W.2d at 632. Noting that the Gutzwiller plaintiffs “did not pur-

chase, directly or indirectly, any product or service provided by

or manufactured with components from Visa or Mastercard,” the

court in Lorix went on to explain that “[w]hatever the precise

prudential limits on Minnesota antitrust standing, we do not be-

lieve that the legislature intended to create ‘consumer standing’

by allowing every person in the state to sue for an antitrust vio-

lation simply by virtue of his or her status as a consumer.” Id.

Plaintiffs urge that, pursuant to the Supreme Court’s decision in

Lexmark Int’l v. Static Control Components, Inc., 572 U.S. 118

(2014), the prudential standing concerns articulated by the court

in Lorix “can play no role with respect to any state antitrust stat-

ute once it is determined that AGC does not apply.” (Opp at. 14-

15.) Yet, Lexmark’s discussion of prudential standing did not pur-

port to address the way state courts interpret their own state’s

antitrust laws, which is at issue here. Furthermore, Amex is cor-

rect that Lorix’s finding that the Gutzwiller’s plaintiffs’ allegations

“that the overcharges forced upon merchants by Visa and Mas-

tercard were passed on to consumers in the form of higher prices”

were not sufficient to establish standing under Minnesota’s anti-

trust statute suggests that Plaintiffs’ claims in this case would

likewise fail. Lorix, 736 N.W.2d at 632; see also Oliver, 2020 WL

2079510, at *9 (explaining that “[t]he crux of Plaintiffs’ argu-

ment is that Amex’s Anti-Steering Rules have led Visa,

Mastercard, and Discover to raise merchant fees,” which “mer-

chants have passed on . . . to consumers.”). Accordingly, the court

grants Amex’s motion for judgment on the pleadings as to Plain-

tiffs’ claims under Minnesota’s antitrust law.

12. Tennessee

Amex argues that Plaintiffs’ claims under Tennessee’s antitrust

statute must be dismissed because the antitrust statute “applies

only to tangible goods, not intangible services.” (Mem. at 16 (cit-

ing Bennett v. Visa U.S.A. Inc., 198 S.W.3d 747, 751 (Tenn. Ct.

App. 2006)).) Amex argues that the court should therefore dis-

miss Plaintiffs’ claim under Tennessee law because it “involves

intangible payment processing services that are not covered by

the Tennessee antitrust statute.” Id. Plaintiffs object, arguing that

their standing should be determined under the “substantial ef-

fects” standard articulated by the Tennessee Supreme Court in

Freeman Indus., LLC v. Eastman Chem. Co., 172 S.W.3d 512, 523

(Tenn. 2005), which requires them to “show that the anticom-

petitive conduct affects Tennessee trade or commerce to a

substantial degree.” (Opp. at 15.) In addition, Plaintiffs contend

that Amex’s argument regarding the intangible nature of the ser-

vices at issue “ignores the Supreme Court’s finding . . ., which

made clear that the product that credit-card companies sell is

transactions, not services to merchants.” (Id. (quoting Ohio v.

Am. Exp. Co., 138 S. Ct. 2274, 2287 (2018)).)

The plain language of the Tennessee appellate court’s decision in

Bennett, to which this court must defer, establishes that Amex has

the more persuasive position. The court in Bennett explained that

“[t]he law is well settled that the [Tennessee antitrust statute]

applies only to tangible goods, not intangible services,” and ex-

plicitly characterized “conduct involv[ing] payment card

processing” as “services, not products.” Bennett, 198 S.W.3d at

751-52. Based on this precedent, the court concludes that Ten-

nessee courts would likewise consider Amex’s alleged

anticompetitive activity to constitute intangible services, and

therefore as beyond the scope of the state’s antitrust statute.3 Ac-

cordingly, the court grants Amex’s motion for judgment on the

pleadings as to Plaintiffs’ claim under Tennessee’s antitrust law.

Because Plaintiff Terry Gayle Quinton, a resident of Tennessee,

does not have a cause of action under the Sherman Act or Ten-

nessee antitrust law, he is dismissed from this case.

13. Arizona and North Dakota

Amex argues that Plaintiffs lack standing under Arizona antitrust

law, independent of the applicability of the AGC factors, based

on the Arizona trial court decision in Consiglio-Tseffos v. Visa

U.S.A., Inc., No. CV 2003-020170, 2004 WL 3030043, at *1 (Ariz.

3 Plaintiffs’ argument that Bennett overlooks Freeman is not convincing in

light of the fact that Bennett cites to Freeman’s “substantial effects” test in

full. See id. at 756.

Super. Ct. Dec. 8, 2004). (Mem. at 13-14.) That case involved a

suit to recover damages for alleged price increases on goods sold

by merchants who accepted the defendant credit-card compa-

nies’ credit and debit services. Consiglio-Tseffos, 2004 WL

3030043, at *1. Noting that plaintiffs were “certainly indirect vic-

tims of the [d]efendants’ conduct,” the court held that plaintiffs

were nonetheless not “indirect purchasers of the services,” as re-

quired under Arizona antitrust law. Id. (“The services sold by

[d]efendants are the right to use Mastercard’s and Visa’s debit

and credit services. The [p]laintiffs do not purchase those ser-

vices.”). Amex makes the same argument regarding Plaintiffs’

claim under North Dakota’s antitrust law. (Mem. at 14 (citing

Beckler v. Visa U.S.A. Inc., No. Civ. 09-04-C-0030, 2004 WL

2475100, at *4 (N.D. Dist. Ct. Sept. 21, 2004).) Amex argues that

Plaintiffs here are likewise not indirect purchasers under Arizona

or North Dakota law and therefore lack standing.

Plaintiffs object with the same argument as addressed and re-

jected above, grounded in the Supreme Court’s decision in

Lexmark. Further, Plaintiffs’ contention that “the lone question to

consider here is whether Plaintiffs have pleaded that their injury

is proximately caused by Amex’s Anti-Steering Rules,” (Opp. at

2), fails to engage with Consiglio-Tseffos, Beckler, or any other Ar-

izona or North Dakota case law. Accordingly, the court grants

Amex’s motion for judgment on the pleadings as to Plaintiffs’

claim under Arizona’s antitrust law and North Dakota’s antitrust

law.

B. State Consumer Protection Claims

Amex also initially moved for judgment as a matter of law as to

Plaintiffs’ consumer protection claims under the laws of Mon-

tana, Ohio, Illinois, Massachusetts, and the District of Columbia.

(Mem. at 16-24.) Plaintiffs concede the motion as to their con-

sumer protection claims under the law of the District of

Columbia. (Opp. at 1 n.1.) Amex concedes that Plaintiffs may

proceed at this stage with their consumer protection claims un-

der the laws of Montana and Ohio. 4 (Reply at 1 n.1.)

Accordingly, the parties’ only disputes as to whether Plaintiffs

may proceed with their consumer protection claims concern the

laws of Illinois and Massachusetts.

1. Illinois

Relying on Laughlin v. Evanston Hosp., 550 N.E.2d 986, 993 (Ill.

1990) and Gaebler v. N.M. Potash Corp., 675 N.E.2d 228, 230 (Ill.

App. Ct. 1996), Amex argues that Plaintiffs’ consumer protection

claim under Illinois law must be dismissed because the claim im-

properly “regurgitates their alleged antitrust injury.” (Mem. at

19.) In Laughlin, the Illinois Supreme Court held that Illinois’

consumer protection statute “was not intended to be an addi-

tional antitrust enforcement mechanism, but instead, the

language of the Act shows that its reach was to be limited to con-

duct that defrauds or deceives consumers or others.” In re

Loestrin 24 FE Antitrust Litig., 410 F. Supp. 3d 352, 372 (D. R. I.

2019)(quoting Laughlin, 550 N.E.2d at 993). Amex argues that

Laughlin therefore bars Plaintiffs’ claim. Plaintiffs contend that

Amex stretches Laughlin too far. See Sergeants Benevolent Ass’n

Health & Welfare Fund v. Actavis, plc, No. 15-cv-6549 (CM), 2018

WL 7197233, at *41-42 (S.D.N.Y. Dec. 26, 2018) (“Laughlin

stands for the proposition that the [Illinois consumer protection

4 In Amex’s opening memorandum in support of this motion, it sought

judgment on the pleadings with respect to Plaintiffs’ claim under Ohio con-

sumer protection law, and Plaintiffs conceded that claim in their

opposition. (See Mem. at 18-19; Opp. at 1 n.1.) However, in light of bind-

ing case law decided during the pendency of this motion, Amex concedes

in its Reply that the relevant class action limitations under Ohio law do not

apply in federal court, and—notwithstanding Plaintiffs’ previous conces-

sion—it therefore agrees that Plaintiffs may proceed with their claims

under Ohio consumer protection law at this stage of the proceedings. (Re-

ply at 1 n.1 (citing La Liberte v. Reid, 966 F.3d 79 (2d Cir. 2020)).)

statute] is not a safety net that serves to catch residual anticom-

petitive behavior, although it does not speak to whether [the

statute] countenances claims are also actionable under [Illinois’

antitrust statute]”); see also Batson v. Live Nation Entm’t, Inc., 746

F.3d 827, 831 (7th Cir. 2014) (“It remains possible . . . that an

unfair practice might be covered by both the antitrust law and

the [consumer protection statute].”).

While there are compelling arguments on both sides, the court

finds that Amex has not demonstrated that Laughlin prohibits

Plaintiffs’ consumer protection claim under Illinois law. As the

Seventh Circuit explained in Batson, while the court in Laughlin

“was concerned about the possibility that the Consumer Fraud

Act might morph into an enforcement mechanism for all antitrust

violations, on the theory that all such violations reflect unfair

practices,” it nonetheless “remains possible . . . that an unfair

practice might be covered by both the antitrust law and the Con-

sumer Fraud Act.” 746 F.3d at 831; see also Siegel v. Shell Oil Co.,

480 F. Supp. 2d 1034, 1048 (N.D. Ill. 2007) (“Laughlin is silent

as to . . . whether consumers can elect to pursue a remedy under

the Consumer Fraud Act where the Illinois Antitrust Act may also

provide relief”); Hill v. PS Illinois Tr., 856 N.E.2d 560, 568 (Ill.

Ct. App. 2006) (“a plaintiff may allege that conduct is unfair un-

der the [consumer protection statute] without alleging that the

conduct is deceptive”). The court disagrees with Amex that the

Seventh Circuit, and courts in the Northern District of Illinois and

Southern District of New York, have “misread” Laughlin; to the

contrary, their decisions highlight the limits of Laughlin’s hold-

ing. Accordingly, Amex’s motion for judgment on the pleadings

as to Plaintiffs’ claim under Illinois’ consumer protection law is

denied.

2. Massachusetts

Amex argues that Plaintiffs’ consumer protection claim under

Massachusetts law fails because Plaintiffs fail to adequately al-

lege that the relevant transactions and actions “occur[red]

primarily and substantially” within Massachusetts, as required by

statute. See Bushkin Assocs., Inc. v. Raytheon Co., 473 N.E.2d 662,

671 (Mass. 1985); see also Mass. Gen. Laws. Ann. Ch. 93A, § 11.

In particular, Amex argues that Plaintiffs’ allegation that “De-

fendants entered into contracts or combinations between two or

more persons in restraining of trade or commerce in the relevant

market/s, a substantial part of which occurred in Massachusetts,”

is too conclusory to establish that Amex’s conduct primarily oc-

curred in Massachusetts. (Mem. at 22 (citing Compl. ¶ 195).)

Plaintiffs respond that they have sufficiently alleged the “intra-

state” pleading requirement under Massachusetts’s consumer

protection law and that it is premature to dismiss their claim at

this stage without first giving Plaintiffs an opportunity to develop

the factual record.

The court finds the First Circuit’s opinion in Fishman Transducers,

Inc. v. Paul, 684 F.3d 187 (1st Cir. 2012) particularly relevant. In

that case, the court examined the “primarily and substantially”

test as articulated by the Massachusetts Supreme Judicial Court

in Kuwaiti Danish Computer Co. v. Digital Equip. Co., 781 N.E.2d

787, 799 (2003). The test requires a defendant arguing for dis-

missal of a claim under the state’s consumer protection law to

show that “the center of gravity of the circumstances that [gave]

rise to the claim were not primarily and substantially within the

Commonwealth.” See Paul, 684 F.3d at 197. The First Circuit, in

considering that test, concluded that “[w]here wrongdoing is not

focused on Massachusetts but has relevant and substantial im-

pact across the country, the ‘primarily’ requirement . . . cannot be

satisfied.” Id.; see also Uncle Henry’s Inc. v. Plaut Consulting Co.,

Inc., 399 F.3d 33, 45 (1st Cir. 2005) (“If the significant contacts

of the competing jurisdictions are approximately in the balance,

the conduct in question cannot be said to have occurred primarily

and substantially in Massachusetts.”). Here, there is no doubt

that Plaintiffs have alleged conduct that has a “relevant and sub-

stantial impact across the country’; therefore, they cannot

maintain a claim under Massachusetts’ consumer protection

law.° Accordingly, Amex’s motion for judgment on the pleadings

is granted as to Plaintiffs’ claim under Massachusetts’ consumer

protection law. Because Plaintiff Nate Thayer, a resident of Mas-

sachusetts, does not have a cause of action under the Sherman

Act, Massachusetts antitrust law, or Massachusetts consumer

protection law, he is dismissed from the case.

IV. CONCLUSION

For the foregoing reasons, Defendants’ (Dkt. 58) motion for judg-

ment on the pleadings is GRANTED in part and DENIED in part.

Specifically,

e The motion is granted as to Plaintiffs’ claims under the

antitrust statutes of Arizona, Illinois, Maryland, Michigan,

Minnesota, Iowa, Nebraska, New Hampshire, North Da-

kota, Rhode Island, South Dakota, Tenneesee, and

Wisconsin. The motion is denied as to Plaintiffs’ claims

under the antitrust statutes of Maine, Utah, and the Dis-

trict of Columbia.

e The motion is granted as to Plaintiffs’ claims under the

consumer protection statutes of the District of Columbia

and Massachusetts. The motion is denied as to Plaintiffs’

° Plaintiffs rely on In re Solodyn (Minocycline Hydrochloride) Antitrust Litig.,

No. 14-md-2503 (DJC), 2015 WL 5458570, at *16 (D. Mass. Sept. 16,

2015), for the proposition that they have satisfied the “intrastate” pleading

standard. That argument is unavailing, because In re Solodyn concerned

the state’s antitrust law, not its consumer protection law and the attendant

requirement that the alleged harm be primarily intrastate.

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claims under the consumer protection statutes of Illinois,

Montana, and Ohio.

e Plaintiffs Terry Gayle Quinton and Nate Thayer are dis-

missed from this case.

The Parties are DIRECTED to contact the chambers of Magistrate

Judge Bulsara regarding next steps in this case.

SO ORDERED.

Dated: — Brooklyn, New York

February 1, 2021

/s/ Nicholas G. Garaufis

NICHOLAS G. GARAUFIS

United States District Judge

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