SD3 II, LLC v. Black & Decker (U.S.) Inc.
888 F.3d 98
4th Cir.2018Background
- SawStop (SD3, LLC and SawStop LLC) developed AIMT (Active Injury Mitigation Technology) and negotiated licenses with major table-saw manufacturers in 2000–2002; negotiations collapsed by June 2002.
- SawStop's principals (Dr. Stephen Gass and David Fanning) suspected industry-wide collusion from events in 2000–2001 (trade-show behavior, a Black & Decker presentation) and observed parallel conduct when licensing talks failed.
- In December 2003 the DOJ published a Federal Register notice announcing a Power Tool Institute (PTI) joint-venture project among manufacturers to develop competing skin-sensing/blade-braking technology and to share IP—public evidence of coordinated activity.
- SawStop publicly accused manufacturers of collusion (2004 interview, expert testimony) and sought legal advice in 2006; counsel warned of potential statute-of-limitations problems.
- SawStop alleges it did not actually discover the PTI/industry boycott until 2010 (testimony by David Peot) and filed suit in February 2014 asserting Sherman Act §1 claims (group boycott and related standard-setting conspiracies).
- The district court granted summary judgment for defendants as time-barred; the Fourth Circuit affirmed, holding SawStop was on actual (by 2003) or at least inquiry notice and failed to investigate, so fraudulent-concealment tolling did not apply.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SawStop's antitrust claim (accrued by 2002) was timely under fraudulent concealment tolling | SawStop: manufacturers fraudulently concealed the boycott; actual discovery occurred in Feb 2010 (Peot testimony), so suit filed 2014 is timely | Defs: SawStop had actual or inquiry notice by 2003 (or 2002) and did not diligently investigate; tolled period not available | Held: Tolling does not apply; SawStop on actual notice by 2003 (at latest) and failed reasonable investigation; claim time-barred |
| What constitutes "actual notice" for fraudulent-concealment tolling | SawStop: lacked sufficient facts pre-2010 to plead a viable claim; prior suspicions insufficient | Defs: by 2002–2003 SawStop knew injury, injurers, and parallel conduct—sufficient to plead a claim | Held: Actual notice requires facts sufficient to plead a claim that would survive motion to dismiss; SawStop met that standard by 2003 (likely by June 2002) |
| Whether the 2003 DOJ Federal Register notice triggered inquiry/actual notice | SawStop: the notice alone did not supply necessary facts before Peot; still only suspicions | Defs: the notice publicly confirmed joint venture and IP sharing—concrete evidence prompting investigation | Held: The 2003 notice provided concrete context that put SawStop on inquiry and actual notice by Dec 2003 |
| Whether SawStop exercised reasonable diligence once on inquiry/actual notice | SawStop: it pursued publicity and expert testimony; further investigation wouldn’t have yielded more before 2010 | Defs: reasonable steps (reporting to DOJ/FTC, further inquiry) were not taken; public statements insufficient | Held: SawStop failed to reasonably investigate (e.g., did not notify DOJ/FTC); diligence requirement unmet, so tolling fails |
Key Cases Cited
- Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321 (U.S. 1971) (antitrust cause of action accrues when defendant acts causing injury)
- GO Comput., Inc. v. Microsoft Corp., 508 F.3d 170 (4th Cir. 2007) (fraudulent concealment doctrine and standards for notice/inquiry)
- SD3, LLC v. Black & Decker (U.S.), Inc., 801 F.3d 412 (4th Cir. 2015) (prior interlocutory opinion addressing pleading sufficiency of SawStop’s group-boycott claim)
- Hobson v. Wilson, 737 F.2d 1 (D.C. Cir. 1984) (actual notice requires awareness of sufficient facts to identify a cause of action)
- Pocahontas Supreme Coal Co. v. Bethlehem Steel Corp., 828 F.2d 211 (4th Cir. 1987) (fraudulent concealment requires facts that are the basis of plaintiff’s claim)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading standard for conspiracy claims)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standard reaffirmation)