In Re Tableware Antitrust Litigation
484 F.Supp.2d 1059, 2007 WL 781963 (2007)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
Circumstantial evidence of a horizontal agreement in restraint of trade is sufficient to survive a summary judgment motion if, when viewed as a whole, it tends to exclude the possibility of independent action, even if each piece of evidence could be individually explained away.
Facts:
- In early 2001, tableware manufacturers Lenox, Inc. and Waterford Wedgwood, USA agreed to participate in a test program to sell their high-end products through a new retail channel, Bed, Bath & Beyond.
- On May 31, 2001, Lenox informed one of its major retailers, May Department Stores Co., of the plan.
- A May executive, Gregory Locraft, reacted with agitation and concern, telling Lenox in a raised voice, 'you do what you have to do and we’ll do what we have to do.'
- About one week later, executives from a competing retailer, Federated Department Stores, Inc., contacted both Lenox and Waterford to complain about the rollout.
- In separate conversations, Federated executives used nearly identical language to that used by May, telling a Lenox executive, 'you have to do what you need to do to grow your business and we need to do what we need to do.'
- Shortly thereafter, on June 12, 2001, Waterford called Bed, Bath & Beyond and terminated its participation in the test program, with Lenox following suit soon after.
- On June 18, 2001, Federated's CEO, James Zimmerman, wrote to Waterford's Chairman, Anthony O’Reilly, praising the decision to withdraw and stating, 'I think you did the right thing for all partners in this game.'
Procedural Posture:
- Plaintiffs, consumers of fine tableware, filed a consolidated class action lawsuit against department stores May and Federated, and manufacturers Lenox and Waterford, in the United States District Court.
- The lawsuit alleged a conspiracy to boycott Bed, Bath & Beyond in violation of § 1 of the Sherman Act.
- The defendants' initial motion to dismiss was denied by the court.
- Following discovery, defendants Federated (joined by May) and Waterford filed separate motions for summary judgment, arguing that plaintiffs had produced insufficient evidence of a conspiracy.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does circumstantial evidence—including parallel conduct by competing retailers, the use of strikingly similar language when pressuring common suppliers, a congratulatory letter referencing 'all partners,' and a CEO's invocation of the Fifth Amendment—create a genuine issue of material fact as to whether the retailers conspired to orchestrate a group boycott, thus precluding summary judgment?
Opinions:
Majority - Walker, Chief Judge
Yes. This collection of circumstantial evidence is sufficient to raise a reasonable inference of an unlawful conspiracy between Federated and May, thereby precluding summary judgment as to them. The court applied the Monsanto/Matsushita standard, which requires plaintiffs relying on circumstantial evidence to present proof that 'tends to exclude the possibility that the alleged conspirators acted independently.' Although the defendants offered a plausible, independent business reason for their actions—protecting their brand image from dilution—the plaintiffs' evidence was sufficient to meet their burden. The court found that the combination of the retailers' simultaneous pressure on the manufacturers, the 'striking similarity' of the language used, the ambiguous letter referencing 'partners in this game,' and the adverse inference drawn from a CEO's invocation of the Fifth Amendment, collectively allowed a reasonable jury to find a 'conscious commitment to a common scheme.' The court granted summary judgment for Waterford, finding no evidence of a horizontal conspiracy between the manufacturers.
Analysis:
This decision illustrates how courts aggregate circumstantial evidence to evaluate antitrust conspiracy claims at the summary judgment stage. It demonstrates that while parallel conduct alone is insufficient, 'plus factors'—such as suspicious timing, unique phrasing in communications, and post-boycott acknowledgments—can create a triable issue of fact. The case serves as a practical guide for litigators on how to build a conspiracy case without direct 'smoking gun' evidence. It reinforces the principle that at the summary judgment phase, courts do not weigh the evidence but determine if the plaintiff's inference of conspiracy is reasonable in light of competing inferences of independent action.
