CHURCH & DWIGHT CO., INC. v. MAYER LABORATORIES, INC.

Filing 231

ORDER Re Questions for Oral Argument. Signed by Judge Edward M. Chen on 2/8/2012. (emcsec, COURT STAFF) (Filed on 2/8/2012)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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CHURCH & DWIGHT CO., INC.,

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Plaintiff,

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v.

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For the Northern District of California

United States District Court

No. C-10-4429 EMC

MAYER LABORATORIES, INC.,

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ORDER RE QUESTIONS FOR ORAL
ARGUMENT

Defendants.
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Church & Dwight’s (“C&D’s”) motion for summary judgment is set for hearing Friday,

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February 10, 2012. Docket No. 198. The parties shall be prepared to discuss – and point to

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evidence in the record supporting – their answers to the following questions:

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(1)

What is Mayer’s response to C&D’s contention that it lacks market power under Rebel Oil

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Co., Inc. v. Atlantic Richfield Co., 51 F.3d 1421 (9th Cir. 1995)? Specifically, what evidence

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in the record supports the contention that C&D restricted output and charged

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supracompetitive prices? Id. at 1434. What evidence supports the contention that “existing

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competitors [including Durex and Lifestyles] lack the capacity to increase their output in the

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short run”? Id.

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(2)

What is the total percentage (in the aggregate) of shelf space in the FDM market – assuming

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C&D’s definition of the relevant market which includes Wal-Mart, c-stores, etc. – that is

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dedicated to Church & Dwight condom products pursuant to a planogram agreement

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(“POG”) or exclusive contract (i.e., c-stores)? Note that for purposes of this question, if a

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store participates in the planogram program, that store should not be counted as having 100%

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of its shelf space covered under the agreement; rather, only the percentage of a participating

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retailer’s shelves that are actually filled with C&D products pursuant to the agreement count.

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The parties should provide a response for each year for which there is data to support the

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calculation.

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(3)

What admissible evidence is in the record to support Mayer’s contention that C&D’s POG

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directly caused Mayer and/or other competitors to lose (or fail to acquire) shelf space? The

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parties should be prepared to cite to all examples in the record.

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(4)

What admissible evidence is in the record to support the contention that C&D’s POG

example, what evidence suggests a clear or systemic pattern of Mayer (or other competitors)

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For the Northern District of California

indirectly caused Mayer and/or other competitors to lose (or fail to acquire) shelf space? For

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United States District Court

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losing shelf space at a retailer at the same time that retailer began or increased its

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participation in the POG? What is C&D’s response/explanation for any such pattern(s)?

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The parties should be prepared to cite to all examples in the record.

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(5)

What is Mayer’s response to C&D’s alternative explanations for Mayer’s loss of shelf space

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and market share? How does Mayer account for alternative reasons it may have lost certain

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retailers’ business (e.g., slow sales, supply chain problems, high price, other competitors’

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contracts for space or shelf positioning, Durex’s two-brand strategy, etc.). What evidence

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does C&D have that these alternative explanations in fact caused loss of Mayer’s share?

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(6)

Is there any admissible evidence in the record which shows that manufacturers besides

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Mayer and Global Protection have suffered harm in the form of lost shelf space or market

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share due to the POG? How does Mayer explain Durex’s and Lifestyles’s performance

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during the same time period?

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(7)

Is there data in the record or a graph that shows the total number of retailers in the FDM

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market (again using C&D’s definition of the relevant market) within each range of

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percentages of shelf space dedicated to C&D condom products – e.g. how many retailers at

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below 50%, 50-55%, 55-60%, 60-65%, 65-70%, 70-75%, above 75%? Is there any data to

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show an unusually low or high number of retailers at the cusp of the minimal threshold of the

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POG (e.g. at 65% level of C&D shelf space)?

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(8)

What admissible evidence is there to show the “tax” effect asserted by Mayer is or is not in
fact influencing retailers’ decisions in allocating shelf space to C&D versus rivals?

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The parties shall also be prepared to discuss current ADR efforts.

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IT IS SO ORDERED.

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Dated: February 8, 2012

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For the Northern District of California

United States District Court

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_________________________
EDWARD M. CHEN
United States District Judge