486 F. App'x 186
2d Cir.2012Background
- Eatoni Ergonomics sued RIM for breach of a settlement resolving Texas litigation over Eatoni's reduced-QWERTY keyboard patent rights.
- The district court confirmed a June 8, 2010 arbitration award in favor of RIM and dismissed Eatoni's amended Sherman Act claims.
- Eatoni amended its complaint asserting §2 claims for refusal to deal, essential facilities, and patent infringement, plus a course-of-conduct theory.
- The court reviewed the arbitration award de novo on law and for clear error on factual findings; it affirmed the award.
- Arbitrator findings included that RIM acted in good faith, followed internal procedures, and did not deceive Eatoni.
- The Court of Appeals affirmed, upholding the arbitration confirmation and the dismissal of the §2 claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Arbitration: manifest disregard challenge | Eatoni alleges the arbitrator misapplied New York law and erred in factual findings. | RIM contends the award complied with law and rested on rational findings. | Affirmed; no manifest disregard. |
| Failure to plead Sherman Act §2 claim (refusal to deal) | Eatoni adequately pleaded a refusal-to-deal antitrust violation. | RIM's joint-proposal good-faith conduct and absence of a preexisting profitable course foreclose claim. | Dismissed; failure to plead anti-competitive conduct. |
| Essential facilities claim viability | Eatoni alleged that RIM's platform was an essential facility for its patented tech. | RIM offered other platforms and did not obligate sharing of patented technology. | Dismissed; claim not plausibly alleging essential facility. |
| Patent-infringement §2 claim barred by settlement | RIM's patent infringement could support a §2 claim continuing after settlement. | Settlement released all asserted or potentially assertable claims and granted RIM a license to Eatoni's patents. | barred by settlement terms; no valid antitrust claim based on patent infringement |
Key Cases Cited
- T.Co Metals, LLC v. Dempsey Pipe & Supply, Inc., 592 F.3d 329 (2d Cir. 2010) (manifest disregard is a high bar; rare egregious impropriety)
- Westerbeke Corp. v. Daihatsu Motor Co., 304 F.3d 200 (2d Cir. 2002) (barely colorable justification; lack of rational basis)
- Dalton v. Educ. Testing Serv., 87 N.Y.2d 384 (N.Y. 1995) (good faith not to act arbitrarily or irrationally)
- Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585 (Sup. Ct. 1985) (refusal-to-deal with preexisting profitable course; predatory motive analysis)
- Verizon Commc’ns Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (Sup. Ct. 2004) (limits Aspen Skiing; predatory motive considerations)
- Transhorn, Ltd. v. United Techs. Co. (In re Elevator Antitrust Litig.), 502 F.3d 47 (2d Cir. 2007) (limits Aspen Skiing applicability in some contexts)
- Bear, Stearns & Co. v. 1109580 Ontario, Inc., 409 F.3d 87 (2d Cir. 2005) (collateral estoppel effects of arbitration decisions)
- Conopco, Inc. v. Roll International, 231 F.3d 82 (2d Cir. 2000) (dismissal under Fed. R. Civ. P. 12(b)(6) when claims precluded)
- SCM Corp. v. Xerox Corp., 645 F.2d 1195 (2d Cir. 1981) (essential facilities; sharing patented platform limits)
- City of Groton v. Conn. Light & Power Co., 662 F.2d 921 (2d Cir. 1981) (fractions approach to antitrust liability; not additive)