902 F. Supp. 2d 704
E.D. Pa.2012Background
- MDL antitrust case alleging a conspiracy among egg producers to restrict supply and raise prices, with direct action plaintiffs pursuing non-class claims against Sparboe and Land O’ Lakes.
- Sparboe moved to dismiss six complaints for failure to state a claim; Land O’ Lakes moved to dismiss Giant Eagle’s complaint on similar grounds.
- Complaints allege multiple collective actions from 1999–2008, including supply reductions, cage-size changes, chick hatch reductions, and USEM export schemes.
- Allegations center on two trade groups, UEP and USEM, and claims that defendants conspired to reduce supply and inflate egg prices.
- Court must evaluate whether allegations plausibly show defendant’s agreement to participate in a conspiracy; prior rulings guide evaluation of pleading sufficiency.
- Court accepted Plaintiffs’ factual allegations as true for purposes of ruling on motions to dismiss.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the complaints plausibly allege a conspiracy | Kroger asserts Sparboe participated in supply reductions and UEP activities. | Sparboe argues allegations are insufficient and generic. | Alleger plausibly suggest conspiracy participation. |
| Whether SAC allegations may be considered on a motion to dismiss | SAC is a public record and central to claims. | SAC not properly subject to judicial notice for truth of facts. | Court will not rely on SAC facts; decide on four-corners complaints. |
| Sparsity of defendant-by-defendant detail permissible at pleading | Allegations across several plaintiffs tie Sparboe to conspiracy. | Not required to detail every act by each defendant. | Pleading sufficiency satisfied when whole complaint shows concerted action. |
| Giant Eagle’s claims against Land O’ Lakes dismissed | IPSAC allegations show secondarily liable conduct. | Lakes not independently liable under Sherman Act. | Giant Eagle’s Sherman Act claim against Land O’ Lakes dismissed without prejudice; state-law claim remains. |
Key Cases Cited
- Continental Ore Co. v. Union Carbide & Carbide Corp., 370 U.S. 690 (U.S. 1962) (look at conspiracy as a whole, not in disjoint parts)
- Twombly v. Bell Atl. Corp., 550 U.S. 544 (U.S. 2007) (plausibility standard; must nudge claims across line from conceivable to plausible)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility pleading standard)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading must show plausible antitrust claim)
- In re Ins. Brokerage Antitrust Litig., 618 F.3d 300 (3d Cir. 2010) (requires plausible inference of agreement in Sherman Act §1 claims)
- In re Processed Egg Prods. Antitrust Litig., 821 F. Supp. 2d 709 (E.D. Pa. 2011) (contextual, holistic view of conspiracy allegations; not require defendant-by-defendant detail)
- In re Blood Reagents Antitrust Litig., 756 F. Supp. 2d 623 (E.D. Pa. 2010) (supports viewing conspiracy as a whole)
- In re TFT-LCD (Flat Panel) Antitrust Litig., 586 F. Supp. 2d 1109 (N.D. Cal. 2008) (antitrust pleading allowances for collective allegations)
- In re Static Random Access Memory (SRAM) Antitrust Litig., 580 F. Supp. 2d 896 (N.D. Cal. 2008) (noting pleading standards in conspiracy cases)
- In re Travel Agent Comm’n Antitrust Litig., 583 F.3d 896 (6th Cir. 2009) (antitrust pleading standards; importance of concerted action)
- Petruzzi’s IGA Supermarkets, Inc. v. Darling-Del. Co., 998 F.2d 1224 (3d Cir. 1993) (requirement of common design for conspiracy suffices with joint action)
- Big Apple BMW, Inc. v. BMW of N. Am. Inc., 974 F.2d 1358 (3d Cir. 1992) (motive difference among conspirators; liability for conspiracy)
- In re Transpacific Passenger Air Transp. Antitrust Litig., 2011 WL 1753738 (N.D. Cal. 2011) (communications among defendants may support inference of agreement)