Amicus Curiae Brief — Duke Energy Carolinas, LLC, et al., Petitioners v. NTE Carolinas II, LLC, et al.

No. 24-917

In the

Supreme Court of the United States

——————————

DUKE ENERGY CAROLINAS, LLC, DUKE ENERGY

CORPORATION, DUKE ENERGY PROGRESS, LLC,

Petitioners,

v.

NTE CAROLINAS II, LLC, ET AL.,

Respondents.

——————————

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

——————————

BRIEF OF PROFESSORS DANIEL A. CRANE

AND HERBERT HOVENKAMP

AS AMICI CURIAE IN SUPPORT OF

PETITIONERS

——————————

PETER E. DAVIS

Counsel of Record

BRITTANY M.J. RECORD

PARAG DHARMAVARAPU

LATHAM & WATKINS LLP

555 Eleventh Street, NW

Suite 1000

Washington, DC 20004

(202) 637-2273

peter.davis@lw.com

Counsel for Amici Curiae

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ...................................... ii

INTEREST OF AMICI CURIAE ............................... 1

INTRODUCTION AND SUMMARY OF

ARGUMENT ........................................................ 2

ARGUMENT .............................................................. 4

I.

The Decision Below Misapplied This

Court’s Section 2 Jurisprudence ......................... 4

A. This Court Employs Conduct-Based

Tests For Determining Whether

Business Practices Violate Section 2 ..............4

B. The Panel Decision Departs From This

Court’s Precedents ..........................................7

C. This Court Should Grant Certiorari to

Clarify When Amalgamation Is

Appropriate Under Section 2 ..........................8

1. Amalgamation

Is

Generally

Improper...................................................8

2. Amalgamation Is Proper Under

Limited

Circumstances

Not

Present Here ..........................................12

II. Certiorari Should Be Granted To Resolve

Confusion In The Lower Courts On When

Amalgamation Is Appropriate .......................... 15

CONCLUSION ......................................................... 19

ii

TABLE OF AUTHORITIES

Page(s)

CASES

3Shape Trios A/S v. Align Technology, Inc.,

C.A. No. 18-1332, 2019 WL 3824209 (D.

Del. 2019) ...............................................................1

Brooke Group Ltd. v. Brown & Williamson

Tobacco Corp.,

509 U.S. 209 (1993) ............................................5, 9

Cargill, Inc. v. Monfort of Colorado, Inc.,

479 U.S. 104 (1986) ................................................9

Cascade Health Solutions v. PeaceHealth,

515 F.3d 883 (9th Cir. 2008)................................17

Continental Ore Co. v. Union Carbide &

Carbon Corp.,

370 U.S. 690 (1962) ............................ 2, 6, 8, 12, 13

Conwood Co. v. U.S. Tobacco Co.,

290 F.3d 768 (6th Cir. 2002)................................18

In re Deere & Co. Repair Service Antitrust

Litigation,

703 F. Supp. 3d 862 (N.D. Ill. 2023)....................18

Dreamstime.com, LLC v. Google, LLC,

54 F.4th 1130 (9th Cir. 2022) ..............................16

Duke Energy Carolinas, LLC v. NTE

Carolinas II, LLC,

111 F.4th 337 (4th Cir. 2024) ................ 7, 8, 12, 18

Duke Energy Carolinas, LLC v. NTE

Carolinas II, LLC,

122 F.4th 120 (4th Cir. 2024) ................................1

iii

TABLE OF AUTHORITIES—Continued

Page(s)

Eastern Railroad Presidents Conference

v. Noerr Motor Freight, Inc.,

365 U.S. 127 (1961) ................................................5

Eatoni Ergonomics, Inc. v. Reseach in

Motion Corp.,

486 F. App’x 186 (2d Cir. 2012) ...........................16

Eisai, Inc. v. Sanofi Aventis U.S., LLC,

821 F.3d 394 (3d Cir. 2016) .................................17

FTC v. Church & Dwight Co.,

665 F.3d 1312 (D.C. Cir. 2011) ............................16

FTC v. Facebook, Inc.,

560 F. Supp. 3d 1 (D.D.C. 2021) ............................1

Inline Packaging, LLC v. Graphic

Packaging International, LLC,

962 F.3d 1015 (8th Cir. 2020)..............................19

Intergraph Corp. v. Intel Corp.,

195 F.3d 1346 (Fed. Cir. 1999) ............................16

Jefferson Parish Hospital District No. 2

v. Hyde,

466 U.S. 2 (1984) ..................................................13

LePage’s Inc. v. 3M,

324 F.3d 141 (3d Cir. 2003) .............................3, 16

Matsushita Electric Industrial Co. v. Zenith

Radio Corp.,

475 U.S. 574 (1986) ................................................9

iv

TABLE OF AUTHORITIES—Continued

Page(s)

New York v. Facebook, Inc.,

549 F. Supp. 3d 6 (D.D.C. 2021), aff’d,

66 F.4th 288 (D.C. Cir. 2023) ..........................1, 10

New York v. Meta Platforms, Inc.,

66 F.4th 288 (D.C. Cir. 2023) ..............................15

NYNEX Corp. v. Discon, Inc.,

525 U.S. 128 (1998) ..............................................13

Octane Fitness, LLC v. ICON Health &

Fitness, Inc.,

572 U.S. 545 (2014) ..............................................10

Pacific Bell Telephone Co. v. linkLine

Communications, Inc.,

555 U.S. 438 (2009) .................................. 2, 5, 6, 12

Professional Real Estate Investors, Inc. v.

Columbia Pictures Industries, Inc.,

508 U.S. 49 (1993) ............................................5, 10

Sanofi-Aventis U.S., LLC v. Mylan, Inc.

(In re EpiPen Marketing (Epinephrine

Injection, USP), Sales Practices &

Antitrust Litigation),

44 F.4th 959 (10th Cir. 2022) ..............................16

Sitts v. Dairy Farmers of America, Inc.,

417 F. Supp. 3d 433 (D. Vt. 2019) .......................18

United States v. Microsoft Corp.,

253 F.3d 34 (D.C. Cir. 2001) ..........................16, 18

v

TABLE OF AUTHORITIES—Continued

Page(s)

Verizon Communications Inc. v. Law Offices

of Curtis V. Trinko, LLP,

540 U.S. 398 (2004) .................................. 3, 5, 9, 10

Viamedia, Inc. v. Comcast Corp.,

951 F.3d 429 (7th Cir. 2020)................................18

Wisconsin v. Indivior Inc. (In re Suboxone

(Buprenorphine Hydrochloride &

Naloxone) Antitrust Litigation),

622 F. Supp. 3d 22 (E.D. Pa. 2022) .....................17

ZF Meritor LLC v. Eaton Corp.,

696 F.3d 254 (3d Cir. 2012), cert. denied,

569 U.S. 958 (2013) ..............................................17

OTHER AUTHORITIES

Antitrust

Modernization

Commission,

Report and Recommendations (2007) .................17

Phillip E. Areeda & Herbert Hovenkamp,

Antitrust Law: An Analysis of Antitrust

Principles and Their Application (4th &

5th eds. 2024) ...................................................7, 13

Phillip E. Areeda & Herbert Hovenkamp,

Antitrust Law: An Analysis of Antitrust

Principles and Their Application (5th ed.

2024) .....................................................................14

Daniel A. Crane, Does Monopoly Broth Make

Bad Soup, 76 Antitrust L. J. 663 (2010) ...............1

Daniel A. Crane, Multiproduct Discounting:

A Myth of Non-Price Predation, 72 U.

Chi. L. Rev. 27 (2005) ..........................................17

vi

TABLE OF AUTHORITIES—Continued

Page(s)

Daniel L. Rubinfeld, 3M’s Bundled Rebates:

An Economic Perspective, 72 U. Chi. L.

Rev. 243 (2005) ....................................................17

INTEREST OF AMICI CURIAE1

Daniel A. Crane is the Richard W. Pogue Professor

of Law at the University of Michigan and a scholar of

antitrust law. His article Does Monopoly Broth Make

Bad Soup, 76 Antitrust L. J. 663 (2010), was cited by

the Fourth Circuit dissent from the denial of

rehearing en banc to explain why the majority

misapplied the “monopoly broth” theory of liability

under Section 2 of the Sherman Act. Duke Energy

Carolinas, LLC v. NTE Carolinas II, LLC, 122 F.4th

120, 124-25 (4th Cir. 2024) (Quattlebaum, J.,

dissenting). Professor Crane’s article and approach to

“monopoly broth” claims have been applied in several

other lower court opinions, including FTC v.

Facebook, Inc., 560 F. Supp. 3d 1, 22 (D.D.C. 2021),

New York v. Facebook, Inc., 549 F. Supp. 3d 6, 25

(D.D.C. 2021), aff’d, 66 F.4th 288 (D.C. Cir. 2023), and

3Shape Trios A/S v. Align Tech., Inc., C.A. No. 181332, 2019 WL 3824209, at *11 (D. Del. 2019).

Herbert Hovenkamp is the James G. Dinan

University Professor at the University of

Pennsylvania Carey School of Law, a Fellow of the

American Academy of Arts and Sciences, and the

surviving author of Areeda & Hovenkamp, Antitrust

Law: An Analysis of Antitrust Principles and Their

Application (formerly with Phillip E. Areeda and

Donald F. Turner) (22 vols., Aspen 2008-2024). The

Fourth Circuit’s panel decision cited the Areeda1 No counsel for any party authored this brief in whole or

in part, and no party, counsel for a party, or person or entity

other than amici curiae and their counsel made a monetary

contribution intended to fund the brief’s preparation or

submission. Counsel of record for the parties received timely

notice of amici’s intent to file this brief.

2

Hovenkamp treatise six times in support of its

position, and the dissenting opinion from the denial of

rehearing en banc cited it five times in support of the

opposing position. The treatise has been cited over

2,000 times in lower court opinions, and over sixty

times in opinions of this Court.

Professors Crane and Hovenkamp submit that the

Fourth Circuit panel applied the “monopoly broth”

theory in ways inconsistent with this Court’s

precedents.

They further submit that there is

considerable confusion in the lower courts on this

issue that warrants this Court’s intervention.

INTRODUCTION AND

SUMMARY OF ARGUMENT

This Court has “emphasized the importance of

clear rules in antitrust law” and rejected the

“amalgamation” of meritless claims to manufacture a

violation of Section 2 of the Sherman Act. Pac. Bell

Tel. Co. v. linkLine Commc’ns, Inc., 555 U.S. 438, 452

(2009). The Fourth Circuit’s decision represents a

significant departure from each of these principles. In

stark contrast to the Circuit majority, the Fourth

Circuit embraced a “monopoly broth” theory that

permits plaintiffs to cobble together a firm’s disparate

and lawful acts into a single, viable Section 2 claim.

That decision conflicts with this Court’s conductbased tests and threatens to chill competitive

practices that are vital to a thriving market economy.

The panel’s core error lies in distorting the

aggregation principle this Court articulated in

Continental Ore Co. v. Union Carbide & Carbon

Corp., 370 U.S. 690 (1962).

There, the Court

concluded that a firm’s disparate conduct can be

considered collectively for Section 2 purposes—but

3

only when the legality of the underlying acts turns on

whether they foreclose a large enough share of the

market, as in the exclusive dealing (and tying)

contexts. The Fourth Circuit disregarded this crucial

limitation, thereby undermining Section 2’s wellestablished conduct-based tests—here, for predatory

pricing, refusals to deal, and sham litigation. These

tests are designed to ensure that courts do not impose

antitrust liability on conduct that is independently

lawful and socially beneficial. So in adopting a broad

“monopoly broth” theory that rejects those tests, the

Fourth Circuit effectively outlawed lawful and

procompetitive conduct. This erroneous approach to

Section 2 threatens to turn standard business

practices into antitrust violations, stifling “innovation

and economic growth” and harming consumer

welfare. See Verizon Commc’ns Inc. v. Law Offs. of

Curtis V. Trinko, LLP, 540 U.S. 398, 407 (2004) (“To

safeguard the incentive to innovate, the possession of

monopoly power will not be found unlawful unless it

is accompanied by an element of anticompetitive

conduct.”).

The Fourth Circuit is not alone in misreading

Continental Ore. Its decision repeats the same flawed

logic of the Third Circuit’s decision in LePage’s Inc. v.

3M, 324 F.3d 141 (3d Cir. 2003) (en banc), a decision

that has since drawn significant criticism from other

Circuits, the Antitrust Modernization Commission,

scholars, the United States—and, more recently, the

Third Circuit itself. LePage’s nevertheless continues

to be cited nationwide—a troubling trend that is

likely to accelerate after the Fourth Circuit’s decision.

The Court should grant certiorari and reverse the

judgment below. In doing so, it should make the

following clear: Section 2 liability may not rest on the

4

cumulative effect of independently lawful conduct,

such as below-cost prices, lawful unilateral refusals to

deal, or non-sham lawsuits. Instead, a defendant’s

separate conduct may be amalgamated to determine

whether it collectively produces an anticompetitive

effect only when the legality of the contracts or

practices at issue turns on whether they foreclose a

substantial share of the market. Similarly, when the

defendant engages in independently wrongful acts,

such as torts or crimes, the cumulative effect of those

independently wrongful acts may be considered in

determining whether, together, they produce the

requisite anticompetitive effect for a Section 2 claim.

The Fourth Circuit’s decision is nowhere close to

either of those narrow categories. Certiorari is

warranted to correct the panel’s serious error and

resolve the widespread confusion in the lower courts.

ARGUMENT

I. The Decision Below Misapplied This Court’s

Section 2 Jurisprudence

A. This Court Employs Conduct-Based Tests

For Determining Whether Business

Practices Violate Section 2

This Court has established clear conduct-based

tests to evaluate monopolization claims under Section

2. That includes tests for each of the three types of

behaviors at issue in this case—predatory pricing,

refusals to deal, and the filing of sham lawsuits.

• Predatory pricing. First, a firm’s predatory

pricing violates Section 2 only when “‘(1) ‘the

prices complained of are below an appropriate

measure of its rival’s costs’; and (2) there is a

‘dangerous probability’ that the defendant will

be able to recoup its ‘investment’ in below-cost

5

prices.”

Pacific Bell Tel. Co. v. linkLine

Commc’ns, Inc., 555 U.S. 438, 451 (2009)

(quoting

Brooke Grp. Ltd. v. Brown &

Williamson Tobacco Corp., 509 U.S. 209, 222-24

(1993)).

• Refusal to deal. Second, a firm’s unilateral

refusal to deal with its rivals can give rise to

antitrust liability only when it “unilateral[ly]

terminat[es] . . . a voluntary (and thus

presumably profitable) course of dealing . . . to

forsake short-term profits to achieve an

anticompetitive end.” Verizon Commc’ns Inc. v.

Law Offs. of Curtis V.Trinko, LLP, 540 U.S. 398,

409 (2004).

• “Sham” litigation. Third, a firm’s “sham”

litigation can give rise to Section 2 liability, if

two preconditions are satisfied:

(1) “[N]o

reasonable litigant could realistically expect

success on the merits” of the lawsuit; and (2) “the

baseless lawsuit conceals ‘an attempt to interfere

directly with the business relationships of a

competitor.’”

Pro. Real Est. Invs., Inc. v.

Columbia Pictures Indus., Inc., 508 U.S. 49, 6061 (1993) (quoting E. R.R. Presidents Conf. v.

Noerr Motor Freight, Inc., 365 U.S. 127, 144,

(1961)).2

These conduct-based tests are tailored to the

competitive circumstances of the practice in question.

2 Whether the filing of “sham” lawsuits can give rise to

antitrust liability is an application of Noerr-Pennington

immunity. 508 U.S. at 51. However, the filing of such “sham”

litigation “merely deprives the defendant of [Noerr-Pennington]

immunity; it does not relieve the plaintiff of the obligation to

establish all other elements of his claim.” Id. at 61.

6

Take predatory pricing. For obvious reasons, a firm’s

low-cost pricing is typically procompetitive. So in

evaluating allegations of predatory pricing, courts

must be wary of penalizing conduct that may well

benefit consumers. Thus, linkLine requires a specific

test for liability—pricing below costs and a serious

probability that a defendant will be able to recoup its

investment. The failure to establish both prongs

implies, if not outright confirms, that the firm’s

pricing advances consumer welfare. See infra at 9.

This test, like those for unilateral refusals to deal and

sham litigation, provides “clear rules” that enable

antitrust defendants to conform their conduct, and it

ensures that procompetitive conduct is not

unnecessarily penalized. linkLine, 555 U.S. at 452.

At the same time, this Court has indicated that a

firm’s distinct acts can be evaluated “as a whole” (i.e.

amalgamated) when their legality turns on, and they,

cumulatively, have the effect of, foreclosing a

substantial share of the relevant market.

See

Cont’l Ore Co. v. Union Carbide & Carbon Corp., 370

U.S. 690, 698-700 (1962). As this Court explained in

Continental Ore, viewing the monopolist’s conduct

synergistically in these circumstances is important

because “tightly compartmentalizing” its disparate

acts obscures their combined effect. Id. at 699. But

that principle has limits.

When the disparate

practices do not collectively contribute to foreclosure

of a large enough share of the market, or when their

legality does not turn on such foreclosure,

amalgamation is improper. See infra at 8-15.

7

B. The Panel Decision Departs From This

Court’s Precedents

The Fourth Circuit’s decision flouted these core

principles of antitrust law.

See Duke Energy

Carolinas, LLC v. NTE Carolinas II, LLC, 111 F.4th

337, 355 (4th Cir. 2024). The panel began by

acknowledging that “when anticompetitive conduct is

alleged to be typical predatory pricing [or] refusing to

deal . . . the case law has developed tests for analyzing

such claims.” Id. at 354. But the court believed that

“when a court is faced with allegations of a complex

or atypical exclusionary campaign, the individual

components of which do not fit neatly within preestablished categories, its application of such specific

conduct tests would prove too rigid.” Id. Without

explaining when allegations qualify as “complex or

atypical” (as many arguably do), the court held that

“‘[a]ggregation is appropriate’ when individual acts

are all ‘part of the same scheme to perpetuate

dominance or drive the plaintiff from the

market.’” Id. at 354-55 (quoting Phillip E. Areeda &

Herbert Hovenkamp, Antitrust Law: An Analysis of

Antitrust Principles and Their Application ¶ 310c7

(4th & 5th eds. 2024)). The court thus allowed a

party’s claims to proceed when the alleged conduct

“do[es] not fit neatly within pre-established

categories,” even though those same claims fail the

requirements for established categories of antitrust

claims, such as refusals to deal, predatory pricing, or

the filing of lawsuits that do not meet the established

standards for being “a sham.” Id. at 354.

Applying this broad rule of aggregation, the panel

concluded that the court erred when it found that

NTE had not shown an actionable violation of

Section 2.

Believing this result compelled by

8

Continental Ore, the panel explained that it was “a

misapplication of antitrust doctrine for a court to

treat a plaintiff's allegations of anticompetitive

conduct ‘as if they were five completely separate and

unrelated

lawsuits,’

effectively

‘tightly

compartmentalizing the various factual components

and wiping the slate clean after scrutiny of each.’”

Duke Energy, 111 F.4th at 355 (citing Continental

Ore, 370 U.S. at 698-99). The panel further held that

“[j]ust as the ‘character and effect of a conspiracy are

not to be judged by dismembering it and viewing its

separate parts, but only by looking at it as a whole,’

so too must a firm’s exclusionary efforts be considered

in their totality.” Id. (quoting Continental Ore, 370

U.S. at 699).

C. This Court Should Grant Certiorari to

Clarify

When

Amalgamation

Is

Appropriate Under Section 2

The panel misunderstood and misapplied

Continental Ore. In seeking to avoid “dismembering”

Section 2 claims, the panel ignored this Court’s clear

stance against stirring up a “monopoly broth” of

liability when the disparate conduct is independently

lawful and its legality does not turn on market

foreclosure. This Court should grant certiorari to

clarify the limited circumstances when amalgamation

is appropriate and explain why this case is not one of

them.

1.

Amalgamation Is Generally Improper

The panel mistakenly leapt from the correct

observation that aggregation can be appropriate to

the false conclusion that “monopoly broth” of alleged

anticompetitive actions—at least in “complex” or

“atypical” cases—should be handed to the fact-finder

9

to determine whether its cumulative effect is

anticompetitive. This broad-brush take on Section 2

liability undermines this Court’s conduct-based tests

for antitrust liability.

The panel decision also

overlooks that certain behavior is lawful because it

holds social value and, accordingly, is protected by

this Court’s precedents. The three types of behaviors

at issue in this case—unilateral price cuts, refusals to

deal, and the filing of non-sham lawsuits—exemplify

this key principle of antitrust law.

First, as noted above, this Court’s precedent

underscores that a firm’s choice to set low prices is

protected unless it meets two predatory pricing

criteria: pricing below cost and a likely chance of

recouping losses. Brooke Grp. Ltd., 509 U.S. at 22224. This is because above-cost pricing rarely harms

competition and price-cutting is a socially beneficial

practice that deserves legal protection. Id. at 226

(“‘[T]he mechanism by which a firm engages in

predatory pricing—lowering prices—is the same

mechanism by which a firm stimulates competition;

because “cutting prices in order to increase business

often is the very essence of competition . . . [;]

mistaken inferences . . . are especially costly, because

they chill the very conduct the antitrust laws are

designed to protect.”’” (alterations in original)

(quoting Cargill, Inc. v. Monfort of Colo., Inc., 479

U.S. 104, 122 n.17 (1986))); see also Matsushita Elec.

Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 594

(1986).

Second, this Court has safeguarded a monopolist’s

unilateral refusal to deal (except for a few narrow

exceptions) to protect its drive to make socially vital

investments. Trinko, 540 U.S. at 407-08 (“Compelling

such firms to share the source of their advantage is in

10

some tension with the underlying purpose of antitrust

law, since it may lessen the incentive for the

monopolist, the rival, or both to invest in those

economically beneficial facilities.”). Even dominant

firms can refuse to deal with their rivals—not because

such refusals cannot exclude competitors, but because

they are essential to recouping investments, which

are critical to the smooth operation of our free-market

system. Id. at 407 (“The opportunity to charge

monopoly prices—at least for a short period—is what

attracts ‘business acumen’ in the first place; it induces

risk taking that produces innovation and economic

growth.”). As Chief Judge Boasberg recently and

succinctly put, this Court’s refusal-to-deal cases “‘are

not premised on the view that [monopolist refusals to

deal] are incapable of harming competition’;

[because,] obviously, ‘refusals to aid new entrants can

indeed’ have that effect.” New York v. Facebook, Inc.,

549 F. Supp. 3d 6, 25 (D.D.C. 2021) (first alteration in

original) (citation omitted), aff’d, 66 F.4th 288 (D.C.

Cir. 2023). Rather, they are based on judgments that

certain behaviors—even by dominant firms—should

be privileged and immune from antitrust scrutiny.

Id.

Third, the filing of a lawsuit that does not meet

this Court’s established criteria for being a “sham”

cannot give rise to antitrust liability. Pro. Real Estate

Invs., Inc., 508 U.S. at 60-61. As noted above, this

Court’s test for sham litigation is an application of

Noerr-Pennington immunity. See supra at 5 n.2. This

Court “crafted the Noerr–Pennington doctrine—and

carved out only a narrow exception for ‘sham’

litigation—to avoid chilling the exercise of the First

Amendment right to petition the government for the

redress of grievances.” Octane Fitness, LLC v. ICON

11

Health & Fitness, Inc., 572 U.S. 545, 556 (2014).

Under the panel’s approach, Duke Energy’s

constitutionally-protected breach of contract lawsuit

against NTE could be an active ingredient of a

“monopoly broth” claim even though that lawsuit is

not a “sham.” That approach threatens to chill the

very protected behavior that this Court has held to be

immune from liability.

Unilateral price cuts, refusals to deal, and nonsham lawsuits stand apart from the exclusive dealing

this Court scrutinized in Continental Ore.

As

explained below, exclusive contracts are lawful unless

they collectively foreclose a large enough share of the

market—thus making amalgamation to determine

the scope of foreclosure a more natural extension of

that conduct-based test. In contrast, below-cost

pricing, unilateral refusals to deal, and non-sham

lawsuits are lawful. Period. Amalgamating protected

unilateral actions to create general collective

anticompetitive effects ignores their inherent legality,

even setting aside the absence of anticompetitive

impact standing alone.

This Court has already made this principle crystal

clear. In linkLine, the Court rejected imposing

Section 2 liability for an alleged “price squeeze” that

amounted to the combination of a non-actionable

refusal to deal and a non-actionable unilaterally set

low price. As this Court succinctly explained:

Plaintiffs’ price-squeeze claim, looking to the

relation between retail and wholesale prices,

is thus nothing more than an amalgamation

of a meritless claim at the retail level and a

meritless claim at the wholesale level. If

there is no duty to deal at the wholesale level

12

and no predatory pricing at the retail level,

then a firm is certainly not required to price

both of these services in a manner that

preserves its rivals’ profit margins.

555 U.S. at 452.

But under the panel’s view here, the plaintiff’s

theory in linkLine should have been allowed because

it involved “complex” or “atypical” anticompetitive

conduct that “do[es] not fit neatly within preestablished categories.” See Duke Energy, 111 F.4th

at 354. linkLine notably did not discuss or imply any

such exception, and the Fourth Circuit’s decision

offers no guidance on when a failed predatory pricing

(or sham lawsuit or unilateral refusal to deal) claim

can be repackaged into something else. The reality is

that the attempt at amalgamation in this case reflects

a misguided effort to combine two lawful behaviors

into a “monopoly broth.” This Court rejected that

approach in linkLine, and it should do so again here.

2.

Amalgamation Is Proper Under

Limited Circumstances Not Present

Here

At the same time, amici believe that in certain

circumstances, the synergistic effect of separate

conduct by the defendant can be considered to

determine whether that conduct results in an adverse

effect on competition in violation of Section 2. That

was the case in Continental Ore, where the defendant,

Union Carbine, foreclosed a substantial share of the

market through multiple exclusivity deals, then

disclaimed Section 2 liability by arguing that no

single deal alone was enough to exclude the rival. 370

U.S. at 697.

This Court rightly rejected that

argument, noting that the cumulative effect of the

13

exclusivity arrangements must be considered “as a

whole.” Id. at 699 (citation omitted). Continental Ore

reflects that certain practices that have the collective

impact of foreclosing a substantial share of

competition in a properly defined market are as

problematic as practices that individually have that

effect. In short, such exclusionary practices should be

analyzed “as a whole.” Areeda & Hovenkamp,

Antitrust Law ¶ 310c7.

But Continental Ore’s aggregation principle only

extends so far. In particular, it naturally applies to

other types of allegedly monopolistic behavior when

that conduct’s legality likewise turns on foreclosing a

substantial share of the relevant market.

For

example, tying arrangements are not unlawful under

this Court’s test unless they foreclose a substantial

amount of commerce. Jefferson Parish Hosp. Dist. No.

2 v. Hyde, 466 U.S. 2, 16 (1984).

Similarly, independently wrongful acts—torts or

crimes—which do not have an anticompetitive effect

standing alone, but may result in a “death by a

thousand cuts”—may be considered in combination.

This Court has emphasized that routine business

torts should not be turned into antitrust cases,

NYNEX Corp. v. Discon, Inc., 525 U.S. 128, 137

(1998).

But a business tort may, in unique

circumstances, have such a severe effect on

competition that it amounts to monopolistic conduct.

Suppose a duopolist firebombs its rival’s factory,

eliminating its only competitor, and hence acquires

power to raise prices and reduce output.3 Such

3

Indeed, a standard trope in antitrust law—a behavior of

which Standard Oil was accused and which is universally

14

behavior (in addition to being criminal and tortious)

would be unlawful under Section 2 of the Sherman

Act. But now suppose that the company engages in a

number of smaller tortious or criminal acts: The

company blows up not the rival’s factory, but two of

the rival’s delivery trucks. It blackmails three of the

rival’s key employees to leave their jobs and steals the

rival’s trade secrets. Taken together, these wrongful

tactics force the rival out of business, with the same

effect as blowing its factory in one fell swoop. Their

synergistic effect on competition may be considered

because, taken together, they foreclosed market

access.

While aggregating such separate acts to determine

whether a “substantial” foreclosure has occurred may

be a valid exercise under Continental Ore, it is only

valid insofar as the acts are themselves unlawful.

Suppose the defendant sells customers a primary

product, requires contractually that they purchase a

secondary product from the defendant or third-parties

it approves, and establishes a good faith approval

process for third-parties. Such a third-party approval

arrangement lacks the coercion to constitute a tie.

Phillip E. Areeda & Herbert Hovenkamp, Antitrust

Law: An Analysis of Antitrust Principles and Their

Application ¶ 1716e (5th ed. 2024). Since there is no

tie, and hence no foreclosure, Continental Ore cannot

apply. The act simply could not be an ingredient in

the plaintiff’s antitrust case.

A variation of the duopolist hypothetical above

further illustrates the limits to aggregation under

Continental Ore. Suppose that the accused company

assumed to constitute anticompetitive conduct—is “blowing up

the competitor’s factory.”

15

does not blow up the competitor’s delivery trucks, but

acquires new ones of its own. It does not blackmail

the employees, but hires them away through promises

of better wages and career advancement. And it does

not steal the rival’s trade secrets, but carefully

observes its rivals’ methods from publicly available

sources, and then improves on them. In concert, these

lawful acts result in the rival leaving the market—

perhaps because it is simply less efficient or its

products less desirable. Section 2 liability cannot

attach against the company. Such independently

lawful acts should not be aggregated into a “monopoly

broth” theory, regardless of their effect on a

competitor, because their legality does not turn on

foreclosing access to the relevant market.

Independently lawful behavior of this kind cannot

become unlawful in combination.

II. Certiorari Should Be Granted To Resolve

Confusion In The Lower Courts On When

Amalgamation Is Appropriate

The panel decision underscores the considerable

confusion percolating in the lower courts concerning

when and how to apply a “monopoly broth” theory of

Section 2 liability. This Court should grant review in

this case to clarify that amalgamation of Section 2

claims is appropriate under Continental Ore only

when the legality of the independent acts depends on

whether they block access to the relevant market.

To begin, as noted in the Petition for a Writ of

Certiorari (at 24-27), a number of other Circuits have

correctly rejected monopoly broth theories when the

ingredients of the alleged broth consisted of lawful

behavior like that here. See New York v. Meta

Platforms, Inc., 66 F.4th 288, 300 n.13 (D.C. Cir.

16

2023); Dreamstime.com, LLC v. Google, LLC, 54 F.4th

1130, 1141-42 (9th Cir. 2022); Sanofi-Aventis U.S.,

LLC v. Mylan, Inc. (In re EpiPen Mktg. (Epinephrine

Injection, USP), Sales Pracs. & Antitrust Litig.), 44

F.4th 959, 982 (10th Cir. 2022); Eatoni Ergonomics,

Inc. v. Rsch. in Motion Corp., 486 F. App’x 186, 191

(2d Cir. 2012); Intergraph Corp. v. Intel Corp., 195

F.3d 1346, 1366-1367 (Fed. Cir. 1999); United States

v. Microsoft Corp., 253 F.3d 34, 58 (D.C. Cir. 2001) (en

banc). Each of these decisions supports the correct

proposition that when “each individual action alleged

by [the plaintiff] does not rise to anticompetitive

conduct . . . , their collective sum likewise does not.”

See, e.g., Dreamstime.com, 54 F.4th at 1142.

The Third and now Fourth Circuits have diverged

from the majority, permitting “monopoly broth”

claims to go forward even when the alleged

underlying conduct was independently lawful and

protected. The panel decision relied on the Third

Circuit’s decision in LePage’s, which affirmed liability

for 3M’s above-cost bundled discounts and exclusive

contractual arrangements on the theory that

the “relevant inquiry is the anticompetitive effect of

3M’s exclusionary practices considered together.” 324

F.3d at 162. Judge Greenberg, joined by then-Judge

Alito, dissented from that en banc decision,

recognizing that 3M’s bundled discounts were lawful

and its exclusivity arrangements did not foreclose

access to enough of the market to have an

anticompetitive effect. Id. at 169-82.

LePage’s has been heavily criticized by other

Circuits, the Antitrust Modernization Commission,

the scholarly community, and the United States as

amicus curiae in this Court. See, e.g., FTC v. Church

& Dwight Co., 665 F.3d 1312, 1316 (D.C. Cir. 2011)

17

(“LePage’s is of course not the law of this circuit, and

it has been roundly criticized.”); Cascade Health

Solutions v. PeaceHealth, 515 F.3d 883, 899-909 (9th

Cir. 2008), Antitrust Modernization Comm’n, Report

and Recommendations 94 (2007) (“The lack of clear

standards regarding bundling, as reflected in

LePage’s v. 3M, may discourage conduct that is

procompetitive or competitively neutral and thus may

actually harm consumer welfare.”); Daniel L.

Rubinfeld, 3M’s Bundled Rebates: An Economic

Perspective, 72 U. Chi. L. Rev. 243, 252-56 (2005);

Daniel A. Crane, Multiproduct Discounting: A Myth

of Non-Price Predation, 72 U. Chi. L. Rev. 27, 44-48

(2005); Amicus Curiae United States Br. 19, 3M Co.

v. LePage’s Inc., 542 U.S. 953 (2004), 2004 WL

1205191.

Indeed, the Third Circuit itself has

admitted that LePage’s rationale has been

“undermined by intervening Supreme Court

precedent,” ZF Meritor LLC v. Eaton Corp., 696 F.3d

254, 274 n.11 (3d Cir. 2012), cert. denied, 569 U.S. 958

(2013), and that “it has been the subject of much

criticism,” Eisai, Inc. v. Sanofi Aventis U.S., LLC, 821

F.3d 394, 405 n.35 (3d Cir. 2016).

Despite the overwhelming criticism that LePage’s

has faced from courts and commentators alike, the

decision has been cited over one hundred times in

lower court opinions since the Third Circuit

acknowledged its dubious standing in 2016. See, e.g.,

Wisconsin v. Indivior Inc. (In re Suboxone

(Buprenorphine Hydrochloride & Naloxone) Antitrust

Litig.), 622 F. Supp. 3d 22, 61 (E.D. Pa. 2022)

(“Indeed, the Third Circuit has explicitly recognized

that independently lawful conduct—i.e., discount

programs, rebates, exclusive dealing contracts—can

have an anticompetitive effect that is actionable

18

under antitrust law.”); Sitts v. Dairy Farmers of Am.,

Inc., 417 F. Supp. 3d 433, 470 (D. Vt. 2019) (favorably

citing LePage’s); In re Deere & Co. Repair Serv.

Antitrust Litig., 703 F. Supp. 3d 862, 903-04 (N.D. Ill.

2023) (similar).

This

Court’s

repudiation

of

LePage’s

understanding of Continental Ore will also have

important consequences for Circuits that have not

squarely addressed the issue. For example, the

Fourth Circuit relied on decisions from two other

Circuits, Conwood Co. v. U.S. Tobacco Co., 290 F.3d

768 (6th Cir. 2002), and Viamedia, Inc. v. Comcast

Corp., 951 F.3d 429 (7th Cir. 2020), in justifying its

holding that “when a court is faced with allegations of

a complex or atypical exclusionary campaign, the

individual components of which do not fit neatly

within pre-established categories, its application of

such specific conduct tests would prove too rigid.”

Duke Energy, 111 F.4th at 354. While the Sixth and

Seventh Circuits have not endorsed the Fourth

Circuit’s approach to “monopoly broth,” Conwood and

Viamedia arguably reflect a lack of clarity on the legal

standards applicable to such claims. See Conwood

Co., 290 F.3d at 783 (endorsing aggregation of

defendant’s business torts to demonstrate Section 2

violation because it demonstrated that defendant

“began a systematic effort to exclude competition from

the moist snuff market,” without clarifying whether

its amalgamation approach was limited to underlying

conduct that is unlawful); Viamedia, Inc., 951 F.3d at

453 (correctly observing that the Section 2 inquiry

should focus on the defendant’s harm to “‘the

competitive process,’” without deciding when

amalgamation of underlying conduct is appropriate

(quoting Microsoft Corp., 253 F.3d at 58)); see also

19

Inline Packaging, LLC v. Graphic Packaging Int’l,

LLC, 962 F.3d 1015, 1029-30 (8th Cir. 2020) (citing

LePage’s, without deciding whether to adopt its

approach). Absent this Court’s intervention, one or

more of these Circuits may consider adopting the

Fourth Circuit’s erroneous approach and deepen the

already entrenched Circuit conflict.

*

*

*

This Court should grant certiorari to clarify that a

plaintiff cannot prevail on a monopolization claim by

aggregating multiple distinct, protected acts into an

unlawful whole. Absent this Court’s intervention, the

Fourth Circuit decision will wreak havoc on antitrust

law by imposing unwarranted penalties on

procompetitive conduct.

CONCLUSION

The petition for a writ of certiorari should be

granted.

Respectfully submitted,

PETER E. DAVIS

Counsel of Record

BRITTANY M.J. RECORD

PARAG DHARMAVARAPU

LATHAM & WATKINS LLP

555 Eleventh Street, NW

Suite 1000

Washington, DC 20004

(202) 637-2273

peter.davis@lw.com

Counsel for Amici Curiae

March 27, 2025