T-Mobile U.S.A., Inc. v AU Optronics Corporation, et al

Filing 86

Joinder in 85 REPLY in support (re 61 MOTION to Dismiss DEFENDANTS JOINT NOTICE OF MOTION AND MOTION TO DISMISS IN PART AMENDED COMPLAINT ) filed bySanyo Consumer Electronics Co., Ltd.. (Davis, Allison) (Filed on 1/31/2012) Modified on 2/1/2012 (ysS, COURT STAFF).

1 Allison A. Davis (CA State Bar No. 139203)
Sanjay Nangia (CA State Bar No. 264986)
2 DAVIS WRIGHT TREMAINE LLP
3 505 Montgomery Street, Suite 800
San Francisco, California 94111
[phone]
4 Telephone:
Facsimile:
[phone]
5 Email:
[e-mail]; [e-mail]

DAVIS WRIGHT TREMAINE LLP

6 Nick S. Verwolf (pro hac vice)
7 DAVIS WRIGHT TREMAINE LLP
777 – 108th Ave. N.E., Suite 2300
8 Bellevue, WA 98004
Telephone:
[phone]
9 Facsimile:
[phone]
Email:
[e-mail]
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11 Attorneys for SANYO Consumer Electronics Co., Ltd.
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IN THE UNITED STATES DISTRICT COURT

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THE NORTHERN DISTRICT OF CALIFORNIA

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SAN FRANCISCO DIVISION

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16 IN RE: TFT-LCD (FLAT PANEL) ANTITRUST
LITIGATION
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This Document Relates To:
Individual Case No. 3:11-CV-02591 SI

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T-MOBILE U.S.A., INC.,
Plaintiff,
v.

22 AU OPTRONICS CORPORATION; et al.,
Defendants.

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Master Docket No. 3:07-md-1827 SI
(Case No. 3:11-cv-02591 SI)
SANYO CONSUMER ELECTRONICS,
CO., LTD.’S JOINDER TO
DEFENDANTS’ REPLY IN SUPPORT
OF JOINT MOTION TO DISMISS TMOBILE’S AMENDED COMPLAINT
Date:
Time:
Courtroom:
Judge :

February 10, 2012
9:00 a.m.
10, 19th Floor
Hon. Susan Illston

A plaintiff must allege a plausible – not possible – conspiracy. Bell Atl. Corp. v. Twombly,

26 550 U.S. 544, 570 (2007). SANYO Consumer Electronics Co., Ltd. (“SANYO Consumer
27 Electronics”) respectfully submits that the allegations of T-Mobile U.S.A, Inc.’s (“T-Mobile”)
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18693648v1

SANYO CONSUMER ELECTRONICS’ JOINDER TO DEFENDANTS’ REPLY IN SUPPORT OF JOINT
MOTION TO DISMISS T-MOBILE’S AMENDED COMPLAINT
Master File No. 3:07-md-1827 SI
Individual Case No. 3:11-cv-02591 SI

1 Amended Complaint (“Complaint”) do not meet the facial plausibility standard established under
2 Twombly. Allegations that are conclusory and consistent with innocent behavior – precisely the
3 type alleged by T-Mobile 1 – are insufficient to meet this standard.
In order to overcome the plausibility threshold, T-Mobile must allege enough factual

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5 matter to suggest that an agreement was made. In re Transpacific Passenger Air Transportation
6 Antitrust Litigation, No. C 07-05634 CRB, 2011 U.S. Dist. LEXIS 49853 at *39 (N.D. Cal., May
7 9, 2011) (citing Twombly, 550 U.S. at 556). A statement alleging that a defendant “agreed to fix
8 prices” is a legal conclusion and not sufficient. See Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550
9 U.S. at 555) (“[T]he tenet that a court must accept as true all of the allegations contained in a

DAVIS WRIGHT TREMAINE LLP

10 complaint is inapplicable to legal conclusions.”); In re Travel Agent Comm’n Antitrust Litig., 583
11 F. 3d 896, 905 (6th Cir. Ohio 2009) (“[P]laintiffs use the word ‘agreement,’ . . .[which] is nothing
12 more than a legal conclusion ‘masquerading’ as a factual allegation.”).
Numerous other courts, including the 9th Circuit, agree. See, e.g., Kendall v. Visa U.S.A.,

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th
14 Inc., 518 F.3d 1042, 1048 (9 Cir. 2008) (an antitrust complaint must “answer the basic questions:

15 who, did what, to whom (or with whom), where, and when?”); In re Hawaiian & Guamanian
16 Cabotage Antitrust Litig., 647 F. Supp. 2d 1250, 1256-1257 (W.D. Wash. 2009) (recognizing that
17 “[a] distinguishing factor” in an antitrust complaint’s viability analyzed under Twombly “has been
18 the inclusion of specific allegations concerning time, place, and person versus general allusions to
19 ‘secret meetings,’ ‘communications,’ or ‘agreements’”) (citations omitted); In re Elevator 502 F.
20 3d 47, 50-51 (2d Cir. 2007) (concluding complaint was “nothing more than a list of theoretical
21 possibilities, which one could postulate without knowing any facts whatever” and that ‘“[s]uch
22 conclusory allegations of agreement at some unidentified point do[] not supply facts adequate to
23 show illegality”’).
T-Mobile’s Complaint only mentions SANYO Consumer Electronics in a few paragraphs.

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25 Nearly half of them are insufficient under Twombly simply due to their conclusory nature and
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1

SANYO Consumer Electronics describes in its opening brief precisely how each of T-Mobile
allegations against SANYO Consumer Electronics are either conclusory in nature or consistent
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with innocent behavior. This is not the “group pleading” argument that T-Mobile discusses in its
28 opposition. Opp. at 2-3.
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SANYO CONSUMER ELECTRONICS’ JOINDER TO DEFENDANTS’ REPLY IN SUPPORT OF JOINT
MOTION TO DISMISS T-MOBILE’S AMENDED COMPLAINT
Master File No. 3:07-md-1827 SI
Individual Case No. 3:11-cv-02591 SI

1 failure to allege sufficient factual matter, as described in detail in SANYO Consumer Electronics’
2 opening brief. See Compl. ¶ 107 (alleging that the parties “engaged in illegal bilateral
3 communications”); ¶ 125 (alleging an agreement to “fix prices”); ¶ 126 (alleging sharing of
4 “competitive information”). T-Mobile does not even address the conclusory nature of these
5 allegations in its Opposition. The other half of the allegations, as specified below, do not even
6 allege any anticompetitive behavior.
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Plaintiff’s allegations must allege anticompetitive behavior that cannot alternatively be

8 explained as innocent behavior. Twombly, 550 U.S. at 567 (“but here we have an obvious
9 alternative explanation”); Iqbal, 129 S. Ct. at 1950 (noting when discussing Twombly “the Court

DAVIS WRIGHT TREMAINE LLP

10 nevertheless concluded that it did not plausibly suggest an illicit accord because it was . . .
11 compatible with . . . lawful . . . behavior.”); Krehl v. Baskin-Robbins Ice Cream Co., 664 F.2d
12 1348, 1357-58 (9th Cir. 1982) (finding that 12 communications over seven years concerning
13 prices was “idle shop talk” and did not establish an unlawful conspiracy); In re Travel Agent
th
14 Comm’n Antitrust Litig., 583 F. 3d 896, 911 (6 Cir. 2009) (“Moreover, a mere opportunity to

15 conspire does not, standing alone, plausibly suggest an illegal agreement because American’s and
16 Continental’s presence at such trade meetings is more likely explained by their lawful, free-market
17 behavior.”); In re Travel Agent Comm’n Antitrust Litig., 2007 U.S. Dist. LEXIS 79918, at *35
18 (N.D. Ohio Oct. 29, 2007) (“[T]he exchange of price data and other information among
19 competitors does not invariably have anticompetitive effects; indeed such practices can in
20 certain circumstances increase economic efficiency and render markets more, rather than less,
21 competitive’’); In re Citric Acid Litig., 191 F.3d 1090, 1103 (9th Cir. 1999) (finding no evidence of
22 conspiracy despite competitor communications and meetings); Amey, Inc. v. Gulf Abstract & Title,
23 Inc., 758 F.2d 1486, 1505 (11th Cir. 1985) (finding that “there is nothing unlawful about
24 competitors meeting and exchanging price information”); In re Graphics Processing Units
25 Antitrust Litig., 527 F. Supp. 2d 1011, 1023 (N.D. Cal. 2007) (“[a]ttendance at industry trade
26 shows and events is presumed legitimate and is not a basis from which to infer a conspiracy,
27 without more.”).
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T-Mobile’s remaining allegations against SANYO Consumer Electronics can alternatively
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18693648v1

SANYO CONSUMER ELECTRONICS’ JOINDER TO DEFENDANTS’ REPLY IN SUPPORT OF JOINT
MOTION TO DISMISS T-MOBILE’S AMENDED COMPLAINT
Master File No. 3:07-md-1827 SI
Individual Case No. 3:11-cv-02591 SI

1 be explained as innocent business practice, as described in SANYO Consumer Electronics’
2 opening brief. See Compl. ¶ 108 (alleging gaining a “better understanding of market situation”); ¶
3 125 (alleging a seller and potential customer discussing prices); ¶ 159 (alleging behavior of
4 “confirming bids”). This in addition to the fact that SANYO Consumer Electronics was not
5 indicted, not involved in the trade associations or the crystal meetings leaves no support for T6 Mobile’s conspiracy claim. See Compl. ¶¶ 101, 113, 174-190.
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Notably, T-Mobile offers nothing to contradict these alternative explanations of innocent

8 business behavior. Instead, T-Mobile naively suggests that “all facts are construed in the light
9 most favorable to the plaintiff.” Opp. at 5. But as described above, this Court must scrutinize the

DAVIS WRIGHT TREMAINE LLP

10 specific allegations, and determine whether they can be explained as ordinary business practice.
11 Iqbal, 129 S. Ct. at 1950. T-Mobile also asserts that “[n]ow is not the time to test the facts
12 underlying T-Mobile’s allegations.” Opp. at 5. Yet SANYO Consumer Electronics is not asking
13 the Court to do this; rather it is asking the Court to review the allegations for alternative
14 explanations as it is required to do under Twombly.
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Because T-Mobile’s allegations against SANYO Consumer Electronics are conclusory and

16 consistent with innocent behavior, SANYO Consumer Electronics requests that this Court grant its
17 Motion to Dismiss. The heart of T-Mobile’s Complaint is directed to other defendants’ guilty
18 pleas and allegations of involvement in crystal meetings, “early conspiracy,” and trade
19 associations. See Compl. ¶¶ 101, 113, 174-190. None of this concerns SANYO Consumer
20 Electronics. T-Mobile has simply not met its burden in providing specifics as to the role that
21 SANYO Consumer Electronics played in the alleged conspiracy. Because there are no factual
22 allegations that implicate SANYO Consumer Electronics in any price fixing conspiracy, T23 Mobile’s complaint fails to state a claim for antitrust conspiracy. Furthermore, dismissal supports
24 the policy goals of Twombly and Rule 12(b)(6), which require Courts to act as a gatekeeper in part
25 to increase judicial efficiency. See, e.g., Arthur R. Miller, From Conley to Twombly to Iqbal: A
26 Double Play on the Federal Rules of Civil Procedure, 60 Duke L. J. 1 (2010) (“[T]he Supreme
27 Court [in Iqbal and Twombly] favored increasingly early case disposition in the name of
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efficiency, economy, and avoidance of abusive and meritless lawsuits.”).
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18693648v1

SANYO CONSUMER ELECTRONICS’ JOINDER TO DEFENDANTS’ REPLY IN SUPPORT OF JOINT
MOTION TO DISMISS T-MOBILE’S AMENDED COMPLAINT
Master File No. 3:07-md-1827 SI
Individual Case No. 3:11-cv-02591 SI

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DATED: January 31, 2012
Respectfully submitted,

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DAVIS WRIGHT TREMAINE LLP

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By:

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/s/ Allison A. Davis
Allison A. Davis

Attorneys for SANYO Consumer Electronics Co., Ltd

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DAVIS WRIGHT TREMAINE LLP

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18693648v1

SANYO CONSUMER ELECTRONICS’ JOINDER TO DEFENDANTS’ REPLY IN SUPPORT OF JOINT
MOTION TO DISMISS T-MOBILE’S AMENDED COMPLAINT
Master File No. 3:07-md-1827 SI
Individual Case No. 3:11-cv-02591 SI