Retail Imaging Management Group LLC v. Fujifilm North America Corporation
Filing
56
Opinion and Order - Plaintiff's motion for temporary restraining order without notice and alternative motion for preliminary injunction 36 are DENIED. Signed on 1/30/12 by Judge Michael H. Simon. (mja)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION
RETAIL IMAGING MANAGEMENT
GROUP, LLC, an Oregon Limited Liability
Company,
Case No.: 3:11-cv-01242-S1
Plaintiff,
OPINION AND ORDER
v.
FUJIFILM NORTH AMERICA
CORPORATION, aNew York Corporation,
Defendant.
Gordon L. Osaka
Kelly A. Fisher
GORDON L. OSAKA, ATTORNEY AT LAW, P.C.
1000 S.W. Broadway, Ste. 940
Portland, OR 97205
Of Attorneys for Plaintiff
Bruce H. Schneider
STROOCK & STROOCK & LAVAN LLP
180 Maiden Lane
New York, NY 10038
Philip S. Van Der Weele
K&L GATES LLP
222 SW Columbia St., Ste. 1400
Portland, OR 97201
Of Attorneys for Defendant
SIMON, District Judge.
Retail Imaging Management Group, LLC ("RlMG") brings a federal antitrust lawsuit
against its competitor and supplier, Fujifilm North America Corporation ("FUJI"), alleging
unlawful monopolization and attempted monopolization in violation of Section 2 of the Sherman
Act, 15 U.S.C. § 2. RlMG also asserts claims of negligence and intentional interference with
economic relations and contract. Before the court is Plaintiff s Motion for Temporary
Restraining Order Without Notice; Alternatively, Motion for Preliminary Injunction With Notice
(Doc. 36). For the following reasons, Plaintiffs motion and alternative motion are DENIED.
I. MOTION FOR TRO WITHOUT NOTICE
On January 17,2012, RlMG requested a Temporary Restraining Order Without Notice
against FUJI. RlMG asked the court to enjoin FUJI from performing a business contract that
FUJI recently entered into with a third party, Rite Aid. RlMG alleges that it had been providing
certain services to Rite Aid for several years, but will now lose substantial income, and may even
go out of business, if FUn, rather than RlMG, is allowed to perform those services for Rite Aid.
A court may issue a temporary restraining order without notice to the adverse party only
if "specific facts in an affidavit or a verified complaint clearly show that immediate and
irreparable injury, loss, or damage will result to the movant before the adverse party can be
heard in opposition." Fed. R. Civ. P. 65(b)(1)(A) (emphasis added). A temporary restraining
order without notice is generally granted only when providing notice to the adverse party would
jeopardize the objective of the injunction. Plaintiffs declarations, testimony, and unverified
complaint! do not show that immediate and irreparable injury, loss, or damage would result to
! Although Plaintiff s motion and memorandum each recite that it was supported by a "verified
Second Amended Complaint," the complaints filed in this matter were not, in fact, "verified."
Page 2 - OPINION AND ORDER
the movant "before the adverse party can be heard in opposition." Accordingly, Plaintiff's
motion for a temporary restraining order without notice is DENIED.
II. ALTERNATIVE MOTION FOR PRELIMINARY INJUNCTION
A.
Standard
A preliminary injunction is an "extraordinary remedy that may only be awarded upon a
clear showing that the plaintiff is entitled to such relief." Winter v. Natural Resources Defense
Council, 555 U.S. 7,22 (2008). A plaintiff seeking a preliminary injunction must show: (1) that
he is likely to succeed on the merits; (2) that he is likely to suffer irreparable harm in the absence
of preliminary relief; (3) that the balance of equities tips in his favor; and (4) that an injunction is
in the public interest. Winter, 555 U.S. at 20 (rejecting the Ninth Circuit's earlier rule that the
mere "possibility" of irreparable harm, as opposed to its likelihood, was sufficient, in some
circumstances, to justify a preliminary injunction).
The Supreme Court's decision in Winter, however, did not disturb the Ninth Circuit's
alternative "serious questions" test. Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127,
1131-32 (9th Cir. 2011) ('" serious questions going to the merits' and a hardship balance that tips
sharply toward the plaintiff can support issuance of an injunction, assuming the other two
elements of the Winter test are also met"). Thus, a preliminary injunction may be granted "if
there is a likelihood of irreparable injury to the plaintiff; there are serious questions going to the
merits; the balance of hardships tips sharply in favor of the plaintiff; and the injunction is in the
public interest") MR. v. Dreyfus, 663 F.3d 1100, 1108 (9th Cir. 2011) (citing Alliance).2
The federal antitrust laws allow injunctive relief for private parties, including preliminary
injunctive relief. Clayton Act, § 16, 15 U.S.C. § 26 ("Any person, firm, corporation, or
association shall be entitled to sue for and have injunctive relief ... against threatened loss or
damages by a violation of the antitrust laws ... when and under the same conditions and
principles as injunctive relief against threatened conduct that will cause loss or damage is granted
2
Page 3 - OPINION AND ORDER
B.
Factual Background
Plaintiff's alternative motion for preliminary injunction was heard by the court with an
evidentiary hearing held on January 19,2012. The following factual background is derived from
the evidence received and the allegations stated in the Second Amended Complaint.
A "minilab" is a self-contained machine that converts images, stored either digitally or on
film, into finished photographs or other similar products. Defendant, FUJI, manufactures
minilabs and sells or leases them in competition with minilabs made by other manufacturers.
FUJI also offers minilab repair service to retail users who purchase or lease FUJI-brand minilabs.
In addition, FUJI sells, or has sold, replacement parts to independent service organizations
("IS Os") that provide repair service for FUJI-brand minilabs. FUJI also provides, or has
provided, technical support to such ISOs. Thus, FUJI both competes with ISOs for the provision
of repair service for FUJI-brand minilabs and also supplies, or has supplied, ISOs with
replacement parts and other technical support used by ISOs in their repair service business.
Plaintiff, RIMG, began business in 2000. RIMG provides repair service for FUJI-brand
minilabs to retail users throughout the U.S in competition with FUJI. RIMG also services
minilabs made by other manufacturers. RIMG alleges that it is the only ISO that competes with
FUJI on a nationwide basis for repair service of FUJI-brand minilabs. RIMG also alleges that
FUJI maintains at least a 70 percent share in what RIMG alleges to be a relevant nationwide
market of repair service for FUJI-brand minilabs.
From 2001 through 2010, RIMG developed a business relationship and course of conduct
with FUJI under which FUJI provided RIMG with access to FUJI-brand minilab replacement
by courts of equity, under the rules governing such proceedings, and upon the execution of
proper bond against damages for an injunction improvidently granted and a showing that the
danger of irreparable loss or damage is immediate, a preliminary injunction may issue.").
Page 4 - OPINION AND ORDER
parts and other resources necessary for RIMG to service FUJI-brand minilabs. The business
relationship between RIMG and FUJI began with "a handshake." Beginning in 2005 and ending
in August 2010, RIMG and FUJI entered into several written contracts. Under these contracts,
FUJI provided parts and other resources necessary for RIMG to service FUJI-brand minilabs.
RIMG alleges that in 2006, FUJI acquired a 30 percent ownership interest in CES.
Before 2006, CES was not a competitor in the servicing of FUJI-brand minilabs. After the
acquisition of this 30 percent interest, RIMG alleges, FUJI terminated its own field service
personnel used to service minilabs and other FUJI-brand machines. CES hired many formerFUJI personnel, and FUJI then outsourced its retail user minilab service work to CES, according
to RIMG. FUJI directed work to CES for FUJI customers on warranty and other service work.
According to RIMG, the FUJI-CES relationship initially had no effect on the FUJI-RIMG
relationship. The FUJI-RIMG service agreements were renewed for two successive two-year
terms, then for a one-year term, and remained in effect until August 2010, when the then-current
agreement expired. Under these written contracts, FUJI provided RIMG with parts and other
resources that RIMG needed to service FUJI-brand minilab machines.
In 2006, Noritsu, a FUJI competitor in the manufacture of minilabs, worked with FUJI
jointly to develop a digital mini dry lab. This product was introduced into the u.s. market in
2008 as the FUJI DL400 series mini dry lab. FUJI continued to provide RIMG with needed parts
and other resources necessary for RIMG to service FUJI-brand mini-labs, including the new mini
dry lab, the DL400.
According to RIMG, its reputation as a national service company grew, and RIMG
became a competitive threat to FUJI minilab service on a nationwide level. In 2009, Sam's Club
(a subsidiary ofWalmart) approached RIMG about bidding for its photo finishing equipment
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service contract, the bulk of which included FUJI-brand minilabs that were then being serviced
by FUJI. That led to a contract between RIMG and Sam's Club for certain Sam's Club locations
beginning in April 2010, with RIMG taking over from FUJI the servicing of all Sam's Club
locations by late 2010.
RIMG alleges that FUJI was unhappy with RIMG's competitive success in the national
market for servicing FUJI-brand minilabs and, as a result, FUJI became less cooperative with
RIMG. In August 2010, the FUJI-RIMG contract came to an end and was not renewed by FUJI.
According to RIMG, FUJI then started withholding from RIMG a "jig kit" that is necessary for
RIMG to use in the repair of defective print heads in FUJI's DL400 series minilabs. Without this
jig kit, RIMG was forced to sub-contract with, or retain, FUJI to repair defective print heads for
RIMG's service customers at a cost to RIMG of approximately $16,000 per print head
replacement. FUJI has sent invoices to RIMG for this work, which total more than $500,000.
RIMG alleges that when a FUJI service customer requires the replacement of a defective print
head, FUJI provides the replacement print head and service without charge.
In October 2011, FUJI took over Rite Aid's "bench work" from RIMG? RIMG alleges
that FUJI is performing this work for Rite Aid below FUJI's average variable cost. RIMG also
alleges that the loss of the Rite Aid revenue from RIMG's bench work will adversely affect
RIMG's cash flow and, hence, its ability to compete with FUJI for FUJI-brand minilab service.
RIMG also alleges that on January 16,2012, FUJI began the process of taking away from
RIMG the photo call center support (also known as "telephone help desk support") for all 4,400
Rite Aid locations nationwide. RIMG's chief executive officer Brad Eamon states that this loss
of business will cause RIMG to lose "in excess of30% oftotal sales" and cause most ofRIMG's
3
"Bench work" is minilab repair work performed off-site from a service customer's location.
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100 Portland-based employees "to lose their jobs on March 1, 2012," if FUJI is allowed to take
over the photo call center service business for Rite Aid. Declaration of Brad Eamon in Support
of Plaintiffs Motion for Temporary Restraining Order.
RIMG contends that FUJI has the intent to suppress RIMG as a service competitor by
raising RIMG's costs of operations, crippling or destroying RIMG's reputation and goodwill,
and fmancially handicapping RIMG's ability to compete with FUJI in the FUJI-brand mini lab
service market. Based on these allegations, RIMG asserts, among other claims, that FUJI has
monopolized or attempted to monopolize the nationwide market for FUJI-brand minilab repair
service. 4 In its motion for preliminary injunctive relief, RIMG seeks to enjoin FUJI from
performing under its recently-negotiated minilab repair service contract with Rite Aid.
C.
Discussion
1.
Likelihood of irreparable injury
"Typically, monetary harm does not constitute irreparable harm." California
Pharmacists Association v. Maxwell-Jolly, 563 F.3d 847,851 (9th Cir. 2009); see also Goldie's
Bookstore, Inc. v. Superior Court, 739 F.2d 466,471 (9th Cir. 1984) ("Mere financial injury,
however, will not constitute irreparable harm if adequate compensatory relief will be available in
the course oflitigation."). RIMG argues, however, that its "[l]oss of revenue and people losing
their jobs satisfies the irreparable harm test," citing SAC and Fox Nation o/Missouri v. LaFaver,
905 F. Supp. 904 (D. Kan. 1995). Plaintiff's Memorandum at 12.
In addition, during the evidentiary hearing RIMG referred the court to Foremost
International Tours, Inc. v. Qantas Airways, Ltd., 379 F. Supp. 88 (D. Haw. 1974), ajJ'd 525
It is unclear from the pleadings whether RIMG alleges that "bench work" and "photo call
center" services are part of the defmed market for FUJI-brand minilab repair service or whether
they are separate relevant markets or sub-markets.
4
Page 7 - OPINION AND ORDER
F.2d 281 (9th Cir. 1975), for the proposition that putting a company out of business may be
sufficient to warrant a preliminary injunction. In Foremost, the district court noted:
Courts should be particularly concerned with threats to the
existence of a moving party's business in the area of antitrust. An
award of only money damages in lieu of preserving a competitor
disserves the public interest.
Foremost, 379 F. Supp. at 97.
FUJI responds by citing the case of Dollar Rent A Car of Washington, Inc. v. Travelers
Indem. Co., 774 F.2d 1371, 1375 (9th Cir. 1985), which FUJI says supports the conclusion that
"an assertion that a moving party would go out of business in the absence of a preliminary
injunction is insufficient to show irreparable injury." Defendant's Memorandum at 8. Both
sides overstate their legal authorities.
In SAC and Fox Nation of Missouri, the district court in Kansas issued a temporary
restraining order that challenged the imposition of a motor fuel tax by the Kansas Department of
Revenue on sales of gasoline diesel fuel sold on Native American lands. The court found
irreparable injury in the fact that the "loss of revenue will result in decreased services and
programs to Tribal members and the loss of employment for specific Tribal members" and noted
that "such basic services as law enforcement and fire protection may be endangered by this loss
of revenue." SAC and Fox Nation, 905 F. Supp. at 907. The Tribes also argued that "the loss of
revenue in the interim may so devastate the Tribes that the ability to sustain themselves may be
irretrievably lost." Id. In light of this, the court concluded that "[u]nder normal circumstances,
monetary loss may be remedied by an award of compensatory damages, and the risk of such loss
is therefore not considered irreparable .... Here, however, the court considers the consequences
of such losses as extremely serious and potentially devastating to the Tribes. Such loss would
Page 8 - OPINION AND ORDER
indeed meet the irreparable harm test." Id. (citation omitted). RIMG's claimed potential losses,
while quite serious, do not appear to rise to this level of widespread devastation.
With regard to Foremost, as FUJI correctly points out in its post-hearing supplemental
memorandum, the district court in that case reviewed a year-to-year financial comparison for
three months, April, May, and June 1973 versus 1974, and found that the plaintiff had lost 67%,
89%, and 95% of its monthly business, respectively. Foremost, 379 F. Supp. at 92; see also
Defendant's Post-Hearing Supplemental Memorandum at 3 n. 2. This is far greater than RIMG's
claimed anticipated loss of30% of its business resulting from Rite Aid's decision to contract
with FUJI rather than with RIMG. 5
On the other hand, the Ninth Circuit decision in Dollar Rent A Car left open the
possibility that, under some circumstances, the irreparable damage requirement may be satisfied
with the threatened destruction of a business. In that case, the Ninth Circuit wrote:
Viking argued to the district court that it would suffer irreparable
injury because all of its income is derived from the TravelersDollar program and, in the absence of the preliminary injunction,
Viking would go out of business. In support thereof, Viking relies
upon Janmort Leasing, Inc. v. Econo-Car International, Inc., 475
F. Supp. 1282, 1294 (E.D.N.Y. 1979). In Janmort, however, the
ongoing business that was threatened with destruction was an
operating car franchise with offices, employees, cars on the road,
etc. Viking, on the other hand, is a subsidiary of Dollar located in
the Caribbean. No showing was made of the number of Viking
employees, its existing good will, or its commitments other than
those incurred by the Reinsurance Agreements.
In the present case, the court is appropriately sensitive to the loss of any jobs by RIMG's
employees in Oregon, but an inappropriately granted preliminary injunction may wrongfully
cause a comparable loss of jobs to FUJI's employees in another state in this nationwide market.
Under constitutional law principles derived from the "dormant commerce clause" doctrine, a
court should not prefer the jobs of employees in one state over the jobs of employees in another
state. See generally Erwin Chemerinsky, CONSTITUTIONAL LAW: PRINCIPLES AND POLICIES 430461 (4th ed. 2011).
5
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Dollar Rent A Car, 774 F.2d at 1375; see also Hughes Network Systems, Inc. v. Interdigital
Communications Corp., 17 F.3d 691,694 (4th Cir. 1994) (in remanding for further
consideration, court noted that even if loss can be compensated by money damages,
extraordinary circumstances may give rise to irreparable harm required for preliminary
injunction); but see Instant Air Freight Co. v.
c.F. Air Freight,
Inc., 882 F.2d 797,801-802 (3d
Cir. 1989) (harm was not deemed irreparable even though nature of action involved loss of
majority of business revenue).
In conclusion, the threatened destruction of a business may, under certain circumstances,
be sufficient to satisfy the requirement that a movant show a "likelihood of irreparable injury."
The evidence that RIMG has presented, however, does not show a likelihood of irreparable
injury. Moreover, for the reasons that follow, RIMG's evidence also does not satisfy its burden
of establishing the other requirements needed for a preliminary injunction.
2,
Serious questions going to the merits
As stated above, in the Ninth Circuit a party seeking a preliminary injunction need not
show a likelihood of success on the merits so long as that party can show'" serious questions
going to the merits' and a hardship balance that tips sharply toward the plaintiff," assuming that
the other two elements (likelihood of irreparable injury and the public interest favors an
injunction) are satisfied. Alliance, 632 F.3d at 1131-32. The Ninth Circuit has also said that, as
an '''irreducible minimum,' the moving party must demonstrate a fair chance of success on the
merits, or questions serious enough to require litigation." Arcamuzi v. Continental Air Lines,
Inc., 819 F.2d 935,937 (9th Cir. 1987).
The gravamen ofRIMG's antitrust claim, as stated in its Second Amended Complaint, is
that FUJI has willfully maintained (or has attempted to obtain and has come dangerously close to
Page 10 - OPINION AND ORDER
obtaining) "monopoly power in the FUJI-brand minilab service market through exclusionary and
anticompetitive conduct." Sec. Am. Comp., ~ 75. RIMG asserts that FUJI has a continuing duty
"to make available to RIMG under reasonable terms all replacement parts and necessary tools
and resources in accordance with FUJI's continuing course of conduct." Sec. Am. Comp.,
~
57.
RIMG's motion for a preliminary injunction, however, does not seek an order requiring FUJI to
continue to make such parts, tools, and resources available to RIMG, pending a final decision on
the merits.
RIMG also alleges that "FUJI sells the replacement print heads at a much higher price
than when they are offered and sold as part of a bundle" and that when "FUJI offers the
replacement print heads with FUJI/CES labor, the labor required to provide the installation is
sold below the average variable cost incurred by FUJI to provide such labor." Sec. Am.
Comp.,
~
60. RIMG's motion for a preliminary injunction, however, does not seek an order
requiring FUJI to "unbundle" its sales ofreplacement print heads and labor, pending a final
decision on the merits.
RIMG further alleges price discrimination in the sale of print heads and claims that "FUJI
favors certain end user customers by selling print heads below the average variable cost FUJI
incurs." Sec. Am. Comp.,
~
62. RIMG's motion for a preliminary injunction, however, does not
seek an order prohibiting FUJI from selling print heads at discriminatory prices or below average
variable cost, pending a final decision on the merits.
Instead, RIMG seeks a preliminary injunction to prohibit FUJI "from performing Rite
Aid's Photo Call Center business." Plaintiffs Memorandum, at 2. That work, however, is not
even mentioned in RIMG's Second Amended Complaint, and it is far from clear whether, and if
so how, a photo call center business relates to the market for FUJI-brand mini lab service, which
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is the only market that RIMG alleges in its Second Amended Complaint that FUJI has
monopolized or attempted to monopolize. 6
During the January 19th evidentiary hearing, counsel for RIMG indicated that RIMG
would soon be seeking leave to file a Third Amended Complaint. On January 26,2012, RIMG
filed an unopposed motion for leave to file a Third Amended Complaint, which the court allowed
on January 27,2012. In its recently amended pleading, RIMG continues to allege that FUJI
possesses "monopoly power in the FUJI-brand minilab service market," Third Am. Comp., ,-r 77,
which FUJI allegedly maintains through exclusionary or anticompetitive conduct. Id at,-r 78.
Also in its Third Amended Complaint, RIMG alleges that "FUJI solicited Rite Aid to
include Rite Aid's Call Center Services work as part ofa bundle of products and services FUJI
would be providing, ultimately taking such work in phases beginning January 16,2012." Third
Am. Comp., ,-r 53. RIMG further alleges: "If the discounts, or other form of monetary or in kind
allowance, given to Rite Aid on the bundled products and services were applied to the Call
Center Services work, FUJI would be doing said work below its average variable cost." Id; see
also Third Am. Comp., ,-r 78(c) ("FUJI has engaged in exclusionary pricing of a bundle
product"). This allegation would appear to connect RIMG's antitrust claim to its request for a
preliminary injunction to prevent FUJI from commencing performance on its recently agreedupon contract with Rite Aid. This allegation may also state an antitrust claim of unlawful
bundling that is recognized in the Ninth Circuit. See Cascade Health Solutions v. PeaceHealth,
515 F.3d 883, 909-910 (9th Cir. 2008) (a bundled price is legal if, when the total discount is
6 To the extent that they are separate markets and RIMG is attempting to allege a theory of
"monopoly leveraging," that is not a valid antitrust theory in the Ninth Circuit. See John Doe 1
v. Abbott Laboratories, 571 F.3d 930,934 (9th Cir. 2009).
Page 12 - OPINION AND ORDER
attributed only to the product that less diversified competitors are trying to sell separately, the
resulting price is above the seller's average variable costs for that product).7
Even if the court ignores, however, the unorthodox timing ofRIMG's motion and
pleadings (moving for a preliminary injunction first based on a theory that is not contained in the
then-most current complaint and later moving to file a further amended complaint that attempts
to link the substantive allegations to the preliminary relief requested), merely alleging a fact does
not make it so. Neither in RIMG's declarations submitted in support of its motion for a
preliminary injunction nor in its submissions at the evidentiary hearing did RIMG offer any
admissible evidence tending to show that "FUJI has engaged in exclusionary pricing of a bundle
product" by offering to perform call center service work below its average variable cost. In his
declaration dated January 17,2012, RIMG's chief executive officer Brad Eamon asserted: "In
effect, FUJI offered Rite Aid a below-cost offer for the call center business that Rite Aid could
not refuse." Mr. Eamon, however, offered no admissible evidence in support of this conclusion
nor any explanation, again with admissible evidence, of how he would know his competitor's
average variable cost structure. Moreover, FUJI's vice president ofField Operations, Steven N.
Pagano, submitted a declaration in opposition to RIMG's motion for preliminary injunction, in
which Mr. Pagano stated: "The anticipated revenues for Call Center Services exceeded the
anticipated costs associated with the provision ofthose services and provided FUJI with a margin
7 The court will wait for another day to evaluate the question of whether call center service is a
"product that less diversified competitors are trying to sell separately," given that both RIMG
and FUJI appear to be selling both repair services and call center services to the same customer.
Thus, ifRIMG offers both services in a bundle, under what circumstances, if any, should the
antitrust laws, under PeaceHealth, restrict FUJI from doing so? There may be a good answer to
that question, but that analysis is for another day.
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ofprofit.,,8 Given the current state ofthe factual record, the court cannot conclude that RIMG
has met its burden of making a clear showing of "a fair chance of success on the merits, or
questions serious enough to require litigation" on the issue of whether FUJI has engaged in
unlawful, below-cost bundling in violation of the antitrust laws.
3.
The balance of hardships and the public interest
At this stage of the litigation, only one fact appears to be reasonably well established:
RIMG and FUJI are currently engaged in significant and vigorous competition with each other to
provide various services (consisting of at least on-site minilab repair service, bench work service,
and call center service) to businesses that lease or purchase FUJI-brand minilabs. As stated
above, in 2010 RIMG took from FUJI the on-site repair service for Sam's Club locations
nationwide. In 2011, FUJI took from RIMG the "bench work" business at Rite Aid. And in
2012, it appears that FUJI now may be taking from RIMG the call center service business for
Rite Aid. Insufficient evidence has been presented to the court to determine whether this is
anything more than simply the competitive forces of the marketplace at work.
In addition, RIMG asserts that FUJI has cut its prices in order to obtain Rite Aid's
business for call center services. The Supreme Court, however, has said that "cutting prices in
order to increase business often is the very essence of competition." Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 475 U.S. 574, 594 (1986). Further, "[l]ow prices benefit consumers
regardless of how those prices are set, and so long as they are above predatory levels, they do not
threaten competition." Atlantic Richfield Co., v. USA Petroleum Co., 495 U.S. 328, 340 (1990).
Moreover, it is well established that "[t]he antitrust laws ... were enacted for 'the
protection of competition, not competitors.'" Brunswick v. Pueblo Bowl-O-Mat, Inc., 429
8 Mr. Pagano, however, did not explain in his declaration whether he was referring to "average
variable costs" or to some other measure of cost.
Page 14 - OPINION AND ORDER
u.s. 477, 488 (1977) (quoting Brown Shoe Co. v.
United States, 370 U.S. 294, 320 (1962)). The
Supreme Court has also stated that it should "resist interpretation geared more to the protection
of existing competitors than to the stimulation of competition." Volvo Trucks North America,
Inc. v. Reeder-Simco GMC, 546 U.S. 164, 168 (2006) (emphasis in original). Finally, '''false
positive' mistaken inferences that chill the very conduct the antitrust laws are designed to
protect" are especially costly. Verizon Communications Inc. v. Law Offices of Curtis V Trinko,
LLP, 540 U.S. 398, 399-400 (2004) (quoting Matsushita, 475 U.S. at 594).
On the basis of the evidence presented, the court cannot conclude that the public interest
favors granting the preliminary injunction sought by RIMG. Moreover, the preliminary
injunction, if granted, may result in FUJI being in breach its contract with Rite Aid. 9 Thus, the
court also cannot conclude that the balance of hardships tips "sharply" in favor ofRIMG.
Accordingly, based on the evidence presented the court declines, at this preliminary stage of the
litigation, to place the substantial power of the federal courts on the side of one competitor
against another as they compete for business in the commercial marketplace.
III. CONCLUSION
For the reasons stated above, Plaintiff's motion for temporary restraining order without
notice and alternative motion for preliminary injunction (Doc. 36) are DENIED.
IT IS SO ORDERED.
Dated this 30th day of January, 2012.
lsi Michael H. Simon
Michael H. Simon
United States District Judge
9 In light ofthe court's ruling, there is no need to discuss the details of any security that would
have been required had a preliminary injunction been ordered. See Fed. R. Civ. P. 65(c).
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