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District Court Grants All Motions to Dismiss in Anti-Trust Class Action

Howard Hess Dental Laboratories Inc. v. Dentsply Int'l, 2007 WL 2807292 (D.Del. Sept. 26, 2007)

This opinion resolved several motions filed in two different antitrust class actions (the “Hess” action and the “Jersey Dental” action). The District Court denied Plaintiffs’ motion for partial summary judgment in the Hess action and granted various Defendants’ motions to dismiss in the Jersey Dental action. Plaintiffs were dental laboratories that purchased dental products from one Defendant, Dentsply, a manufacturer and distributor of dental products. In the Hess action, Plaintiffs sued Dentsply for alleged antitrust violations in connection with an adopted policy providing that dental dealers promoting Dentsply’s product not add competitive product lines. In the Jersey Dental action, Plaintiffs sued Dentsply and twenty six dental dealers alleging antitrust violations arising from the same Dentsply policy. 

In the Hess action, Plaintiffs moved for partial summary judgment on their claims that Dentsply engaged in “exclusive dealing/monopoly maintenance”. Plaintiffs argued that Dentsply was collaterally estopped from contesting liability because in an earlier suit brought by the federal government, Dentsply was found to have practiced exclusionary policies in violation of antitrust laws. Dentsply argued that whether Plaintiffs paid higher prices due to the exclusionary practices was not litigated in the government action. The Court agreed, declining to infer that a finding of exclusionary practices also implied a finding that consumers were necessarily injured and denying further injunctive relief. In the Jersey Dental action, several non-Delaware defendants moved to dismiss for lack of personal jurisdiction and improper venue. Plaintiffs argued that the jurisdictional clause of the Clayton Act required only that the non-Delaware defendants have “national contacts” rather than specific contacts with the jurisdiction they were sued in. The Court disagreed, finding that the authority Plaintiffs relied on was restricted to foreign corporations, and that Plaintiffs produced no evidence that the moving Defendants did business in Delaware or satisfied the minimum contacts test. The Court therefore granted the motion to dismiss based on lack of personal jurisdiction. The Court also found that because the non-Delaware defendants conducted no activities in Delaware, venue was improper under the Clayton Act. Dentsply sought dismissal of the Plaintiffs’ conspiracy to monopolize claims under F.R.C.P. 12(b)(6), arguing that the Plaintiffs lacked standing to pursue the injunctive relief given the injunctive relief granted in the previous government action. The Court agreed, finding that Plaintiffs did not establish entitlement to a second injunction because they did not demonstrate threat of future injury and/or irreparable harm. The dealer defendants in the Jersey Dental action also moved to dismiss the conspiracy to monopolize and restrain trade claims against them, arguing that Plaintiffs, as indirect purchasers, did not have standing to seek damages for the alleged antitrust violations. The Court agreed, finding that the Plaintiffs did not fall within the “general co-conspirator exception” to the common law exclusion of indirect purchasers, and thus could not obtain the relief sought from the dealer defendants. Finally, the Court granted Defendants’ motion to dismiss the conspiracy to monopolize claims on the grounds that the Plaintiffs did not allege sufficient facts to establish the dental dealer defendants’ specific intent for Dentsply to hold a monopoly. 

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