U.S. Senior District Judge John Padova today granted in part and denied in part the motion of Comcast for summary judgment on claims that it violated sections 1 and 2 of the Sherman Act by entering into market-allocation agreements with competitors and monopolizing the market for cable services in the Philadelphia area.

Judge Padova's 72-page Memorandum dismisses the section 1 per se claim and parts of the section 2 claims but finds triable issues of fact on the section 1 rule of reason claim and the balance of the section 2 claims.

[Blawgletter has the honor to serve as co-lead counsel for the class.]

You've likely heard by now that the Antitrust Division of the U.S. Department of Justice sued Apple and a bunch of e-book publishers for fixing prices on, well, e-books.

You can see the complaint here.

The key part comes in paragraph 7, which explains Apple's "agency" plan for thwarting Amazon's effort to cut all e-book prices to $9.99 thus:

The plan — what Apple proudly described as an "aikido move" — worked. Over three days in January 2010, each Publisher Defendant [and Apple] entered into a functionally identical agency contract . . . that would go into effect simultaneously in April 2010 and "chang[e] the industry permanently." These "Apple Agency Agreements" conferred on the Publisher Defendants the power to set Apple's retail prices for e-books, while granting Apple the assurance that the Publisher Defendants would raise retail e-book prices at all other e-book outlets, too. Instead of $9.99, electronic versions of bestsellers and newly released titles would be priced according to a set of price tiers contained in each of the Apple Agency Agreements that determined de facto retail e-book prices as a function of the title's hardcover list price. All bestselling and newly released titles bearing a hardcover list price between $25.01 and $35.00, for example, would be priced at $12.99, $14.99, or $16.99, with the retail e-book price increaasing in relation to the hardcover list price.

The tying of the e-book price to the hardcover list price had the effect of letting the publishers leverage their power over list prices in the hardcover realm into the e-book space. So the theory goes.

The DOJ doesn't ask for damages, just declaratory and equitable relief that would get rid of the Apple Agency Agreements.

The move comes months after private parties filed a slew of cases alleging the same section 1 violation of the Sherman Act. And they for sure DO seek damages. Lots of them. Three times lots of them even.

The town that Blawgletter grew up in included people who would ask you to stand or sit someplace else so they could watch the Andy Griffith Show by saying "you've been drinking muddy water". The gentleness of the nudge made moving easy. And it still makes us smile.

Today, a ruling out of the Seventh Circuit reminded us that colorful words — not to mention conduct — come from all over this Great Nation of ours, including the upper Middle West.

For some years, the folks in a Wisconsin college town kept a rowdy bar, the Nasty Habit, in the business of pouring whiskey shots for blind-drunk patrons, getting in fist-fights with semi-sober ones, and hiding young women in the basement so police wouldn't check their under-age IDs.

We know about the Nasty Habit because it sued the City of Eau Claire — whose name means something like "clear water" — for trying to take away the bar's liquor license. The offense? Running a "disorderly or riotous, indecent or improper house".

The bar claimed that the City broke its constitutional right to sell booze. The law struck the saloon as vague. What, the gin joint asked, does "riotous" mean? Does it include smashing customers' faces with your barkeep's bony knuckles? Does "improper" cover "over-serving" someone to the point the has to go to the ER for "detoxification"? Really, how can you expect us to get through Happy Hour with such uncertainty?

The Seventh Circuit had no trouble saying that the district court did right by tossing the Nasty Habit out on its ear. Hegwood v. City of Eau Claire, No. 11-1999 (7th Cir. Apr. 9, 2012).

We'll drink to that.

Blawgletter hasn't hidden our liking for the cut of the Second Circuit's jib. We admire lots of things about the court. This week, three panels confirmed our High Opinion.

Let's see . . . one involved whether an antitrust complaint met the Twombly/Iqbal standard for pleading a "plausible" conspiracy, the second dealt with the use of video that belongs to others on YouTube, and the third concerned Texas lawyers who used hardball tactics to pre-empt a New York arbitration.

In Anderson News, L.L.C. v. Am. Media, Inc., No. 10-4591-cv (2d Cir. Apr. 3, 2012), Their Honors ruled that the district court erred in holding that the complaint failed to allege a "plausible" conspiracy among magazine publishers to punish a wholesaler for asking them to pay a "surcharge" for handling the magazines that didn't sell. "The question at the pleading stage is not whether there is a plausible alternative to the plaintiff's theory; the question is whether there are suficient factual allegations to make the complaint's claim plausible." Id. at 37.

The panel in Viacom Int'l, Inc. v. YouTube, Inc., No. 10-3270-cv (2d Cir. Apr. 5, 2012), revived a class action complaint against YouTube under the Digital Millennium Copyright Act. Unlike the district court, the appeals court held that YouTube didn't prove its right to a "safe harbor" under section 512(c) of the DMCA. It sent the case back for more attention to, among other things, evidence of (a) actual awareness by YouTube's founders of infringing clips and (b) YouTube's "willful blindness" to the posting of such clips on YouTube.

And Enmon v. Prospect Capital Corp., No. 10-2811-cv (2d Cir. Apr. 6, 2012), upheld sanctions (including more than $350,000 in fees) against a law firm in Houston, Arnold & Itkin, for over-the-top efforts to thwart an arbitration in New York by means of a temporary restraining order from a Texas state court and what the court deemed meritless challenges to the arbitral award against the firm's client.

Blawgletter thinks we can all agree that the U.S. Supreme Court has done few favors in the last decade or two for what the folks at the American Law Institute call "aggregate litigation" — mainly class actions. What with Dukes (no class for women who work at Wal-Mart) and Concepcion (no class for AT&T wireless customers) in the last term, the chances for getting and keeping a class just keep on dwindling.

The term before that gave us a judicial jab at class arbitration in Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., 130 S. Ct. 1758 (2010). The Court there ruled that arbitrators can't order arbitration on a class basis unless the parties agree to arbitrate on a class basis. We said at the time that after Stolt-Nielsen arbitrators "will have no choice but to deny almost all class certification requests."

Today, the Third Circuit begged to differ. The panel held that an arbitrator did not exceed his powers when he found a contractual basis for making the parties arbitrate on a class basis. (The dispute concerned how much pay a health plan owed doctors.) He saw the grounding for class arbitration in these words:

No civil action concerning any dispute arising under this Agreement shall be instituted before any court, and all such disputes shall be submitted to final and binding arbitration in New Jersey, pursuant to the Rules of the American Aabitration Association with one arbitrator.

Sutter v. Oxford Health Plans LLC, No. 11-1773 (3d Cir. Apr. 3, 2012). We'll let you read the opinion for the thought process that went into the arbitrator's ruling and the panel's upholding of it. But it has a lot to do with the vast leeway arbitrators have in deciding cases.

The WSJ has a front-page online item on an effort within the American Bar Association to change the rule on who can own law firms. Right now, only lawyers can, as a matter of legal ethics, share in law firm equity. But the rule differs in U.K. and even more so Down Under.

People who oppose changing the rule tend to urge that letting non-lawyers buy into firms would cloud lawyers' judgment and force them to adopt the dubious morals of the market.

What do you think?

Blawgletter marvels at the audacity of people who make, import, and sell knock-offs of famous brands of what you call luxury goods — mostly purses and watches but lots of other high-end, show-off stuff, too.

We suspect they know that the wages of their trademark rip-off sin will run steep — but only if Louis Vuitton or Gucci or Rolex or Hello Kitty catches them.

Well, LV did snag a couple of these audacious types. And pay they did. After giving LV a good deal of run-around, partly because of federal criminal charges against them, the ersatz designer handbag hawkers met their Doom before The Hon. Alvin K. Hellerstein, U.S.D.J., who granted summary judgment to LV on liability, damages, and fees.

The appeal posed some issues that the Second Circuit panel disposed of in a summary order. The other two — whether Judge Hellerstein erred in refusing to postpone Judgment Day pending the outcome of the criminal case and whether he messed up in awarding $3 million in statutory damages and $.5 million in attorneys' fees — formed the subject matter of the opinion the panel published.

The panel affirmed Judge Hellerstein in all respects. Louis Vuitton Malletier S.A. v. LY USA, Inc., No. 08-4483-cv (2d Cir. Mar. 29, 2012). The district court had vast discretion on the question of staying the case or not until a jury convicted or acquitted the defendants, the panel said. And abuse it he did not, in part because LV deserved a reasonably quick resolution and so did the purse-buying public. On the second question, the panel saw no reason to second-guess Judge Hellerstein's award of statutory damages and fees, even on summary judgment.

Fun facts:

"Louis Vuitton is a French fashion house founded in 1854." Id. at 6.

The defendants "were convicted principally of charges related to a mark registered by Burberry Limited, not Louis Vuitton." Id. at 22.

Calling fees that a firm earns for representing a client "attorneys' fees" instead of "attorney fees" or "attorney's fees" seems to the panel "likely more accurate". Id. at 3 n.1.

Can you avoid your promise to arbitrate a dispute, or slow the process down, if you and the bad guy also have a lawsuit going on at the same time?

Nope. Promega Corp. v. Life Technologies Corp., No. 11-1263, slip op. 12 (Fed. Cir. Mar. 28, 2012) ("The district court's duty to compel arbitration is not altered by the fact that non-arbitrable claims may remain pending in the district court.").

You didn't ask what Blawgletter thinks about the Patient Protection and Affordable Care Act, as its fate dangles in the well of the U.S. Supreme Court courtroom. We'll tell you just the same.

The "individual mandate" part of it (and perhaps the requirement that insurers cover all comers) will vanish in a puff of commerce clause vapor. The rest will limp on. The vote will run 5-4. Before long, one of the five will leave the Court, as will one of the four. And the two new appointees will make up a new majority — one that would have gone the other way.

Mark our words!

Which brings us to a far easier fight, this one over the question of whether a New Deal-era law bars suits more than two years after the day when the defendant "realized' an unlawful "profit" on the purchase and sale (or sale and purchase) of a security within a six-month period.

We say easier because all the justices who voted cast their ballots the same way — against the party (the plaintiff) who claimed that she could wait to sue much more than two years after "such profit was realized", in the words of the statute.

The Court, speaking through the keyboard of Justice Antonin Scalia, thought the claim nonsense. A panel of the Ninth Circuit had ruled the opposite, citing a rule a different panel had set up in 1981. The rule said that the clock couldn't start ticking on the two-year period until the defendant filed a report disclosing the purchase and sale (or sale and purchase) that happened within a six-month period (and yielded a "short-swing" profit).

The Court said:

[The statute] itself quite clearly does not extend the period in that manner. The 2-year clock starts from "the date such profit was realized." § 78p(b). Congress could have very easily provided that "no such suit shall be brought within two years after the filing of a statement under subsection (a)(2)(C)." But it did not.

Credit Suisse Securities (USA) LLC v. Simmonds, No. 10-1261, slip op. 4-5 (U.S. Mar. 26, 2012).

So there.

All nine justices on the U.S. Supreme Court today agreed to wipe out patents that told doctors how to tell how much of a drug to give a patient. The patents' sin? They did little more than describe a "law of nature".

Prometheus Labs held sole rights to a couple of patents. The patents dealt with testing patients with autoimmune diseases to find out whether a higher or lower dose of a drug would improve the drug's effect. Prometheus sold kits that let doctors give the tests, which measured how much "metabolites" patients produced after getting a dose of "a thiopurine compound". The Mayo Clinic bought the Prometheus tests for awhile but then quit and started using its own test.

Prometheus sued for patent infringement. It lost on summary judgment. The Federal Circuit reversed not once but twice — the first time before Bilski v. Kappos, 130 S. Ct. 3218 (2010), which deemed a hedging process an unpatentable "abstract concept", and the second time after the Supreme Court sent the case back to it for further review in light of Bilski.

The Federal Circuit's ruling did not impress the justices. They, speaking through Justice Breyer, thought that the patents didn't do enough with a law of nature — how a human body responds to a dose of a Drug A — to avoid granting a monopoly on the law of nature:

If a law of nature is not patentable, then neither is a process reciting a law of nature, unless that process has additional features that provide practical assurance that the process is more than a drafting effort designed to monopolize the law of nature itself. A patent, for example, could not simply recite a law of nature and then add the instruction "apply the law." Einstein, we assume, could not have patented his famous law by claiming a process consisting of simply telling linear accellerator operators to refer to the law to determine how much energy an amount of mass has produced (or vice versa). Nor could Archimedes have secured a patent for his famous principle of flotating by claiming a process consisting of simply telling boat builders to refer to that principle in order to determine whether an object will float.

Mayo Collaborative Services v. Prometheus Laboratories, Inc., No. 10-1150, slip op. 8-9 (U.S. Mar. 20, 2012).

See, e.g., "'Process' Must Do Stuff to Deserve a Patent, Federal Circuit Affirms"; "Bolts of Business Insight May Flash in Pan at Supreme Court; Bilski the Hedger"; "Supreme Court Ends Term: Guns, Prayers, Accounting, and Patents".