Lead Opinion
Plaintiff-Appellant JetAway Aviation, LLC (“JetAway”) sued Defendants-Appel-lees (“Defendants”) alleging, inter alia, violations of §§ 1 and 2 of the Sherman Act. Defendants are two local governmental entities, the Board of County Commissioners of the County of Montrose, Colorado (the “BOCC” or the “County”) and the Mont-rose County Building Authority, and also non-governmental defendants Jet Center Partners, LLC (“JCP”), Black Canyon Jet Center, LLC (“BCJC”), Kevin Egan, and James Rumble.
Acting as a quorum, Judges Tymkovich and Holmes join this per curiam opinion and affirm the district court’s judgment. More specifically, both judges conclude that the district court’s decision
Because this court fully denies JetAway relief at the threshold on the basis of its failure to establish an antitrust injury, it has no need to reach Governmental Defendants’ cross-appeal regarding state-action immunity. Accordingly, that cross-appeal is dismissed as moot.
In addition, the court addresses here two pending procedural matters—a motion to seal and a motion to strike. JetAway has filed an unopposed motion to seal Volume XVI of its appendix, which contains numerous documents that were under seal in the district court. This motion was provisionally granted by the Tenth Circuit’s clerk’s office, pending the merits panel’s final determination. For the reasons that follow, the court denies the motion to seal.
“Courts have long recognized a common-law right of access to judicial records,” but this right “is not absolute.” Mann v. Boatright,
On appeal, JetAway does not provide any basis for sealing the identified documents; instead, it merely states that the documents were filed under seal in the district court pursuant to a protective order and requests that this court maintain the status quo. Controlling precedent in this circuit—that was readily available to JetAway when it filed its motion to seal— explicitly rejects such an explanation as a sufficient justification for sealing documents on appeal. See Helm,
Under the foregoing precedent, this court clearly could rest its denial of JetA-way’s motion to seal solely on this lack of justification. However, despite having no obligation to do so, this court has taken the additional step of examining JetAway’s motion for a protective order—presented to the district court—to discern whether JetAway has ever expressly offered any specific grounds for why the confidentiality of the documents at issue “outweighs the presumption of public access.” Colony Ins. Co.,
However, a generalized allusion to confidential information is woefully inadequate to meet JetAway’s “heavy burden.” See Helm,
And, with limited elucidation required, the court disposes of the second procedural matter. Defendants move to strike Jet-Away’s reliance on notes taken by County Commissioner David White regarding conversations he had with JCP’s Kevin Scott. The notes purportedly support JetAway’s position that Mr. Scott and Mr. Rumble colluded with Mr. Patterson to ensure that fixed-base operator (“FBO”) services at Montrose Regional Airport (the “Airport”)
In sum, by this per curiam opinion, this court AFFIRMS the district court’s grant of summary judgment to Defendants, DISMISSES Governmental Defendants’ cross-appeal as moot, DENIES JetAway’s motion to seal, and DENIES Defendants’ motion to strike as moot.
Notes
. When appropriate, the attached concurrences use the abbreviations noted here and, more generally, refer to the BOCC and the Montrose County Building Authority as "Governmental Defendants,” and to JCP, BCJC, Mr. Egan, and Mr. Rumble as "Non-Governmental Defendants.”
. When appropriate, the attached concurrences use the abbreviations noted here ("FBO” and the “Airport”) in reference to fixed-base operator services at the Montrose Regional Airport.
Concurrence Opinion
concurring:
I join the per curiam opinion that affirms the judgment of the district court. I write separately to explicate my reasoning for concluding that JetAway has failed to establish an antitrust injury and, consequently, lacks antitrust standing to bring this action.
In 2005, the County decided to privatize FBO services at the Airport and requested proposals from private parties. The BOCC received two proposals—one from JetAway and one from JCP. When JCP was selected to provide FBO services at the Airport, JetAway filed the instant lawsuit, alleging that Defendants violated the Sherman Act by manipulating the selection process and excluding JetAway from competing in the FBO services market at the Airport. The district court granted summary judgment in Defendants’ favor, con-
I
A
Despite the voluminous record and extensive discovery undertaken in this case, the facts necessary to decide this appeal are relatively few. The difficulties among the parties arose from JetAway’s efforts to obtain the right to serve as an FBO at the Airport, which the County runs. An FBO is a commercial business that provides a variety of aircraft-related services, such as fueling, hangaring, parking, aircraft rental, aircraft maintenance, and flight instruction. From 1991 to January 2006, the County ran the FBO at the Airport.
The BOCC is the governing authority for the County and consists of three members. Beginning in 2002, the BOCC began discussing the need to expand FBO services at the Airport and whether it should privatize these operations. Around the same time, Mr. Scott and Defendants Mr. Rumble and Mr. Egan considered forming JCP for the purpose of operating an FBO at the Airport in the event the County privatized FBO services. In early 2002, Mr. Scott provided the BOCC with a draft request-for-proposal (“RFP”) form for the BOCC to use in soliciting bids if it chose to privatize FBO services. Moreover, on April 5 of that year, JCP submitted an unsolicited proposal to the BOCC to be selected as the FBO for the Airport, which was not accepted. In the following years, JCP lobbied for privatization of the FBO services at the Airport. JetAway also was in favor of privatization.
The three members of the BOCC were up for re-election in November 2004. At least two candidates publicly endorsed privatization of FBO services at the Airport: Bill Patterson and Allan Belt. Mr. Patterson and Mr. Belt won two of the three BOCC seats in the November 2004 election and, shortly thereafter, met with Mr. Scott and Mr. Rumble regarding this potential privatization. But support for privatization was not unanimous; in fact, an external consulting firm concluded that the County would economically benefit from continuing to operate the FBO at the Airport.
Also in 2004, JetAway purchased property adjacent to the Airport, from which it began operations as a “through-the-fence” FBO service provider. From this property, JetAway provided non-fuel-related FBO services to the Airport—which, in JetAway’s view, placed it in a strong position to be selected by the County as the Airport’s FBO if FBO services were privatized.
In early 2005, the BOCC decided that the County should privatize FBO services at the Airport. It therefore published an RFP for a private, on-Airport FBO service provider. The County reserved the right to negotiate with one, two, or several parties that might submit proposals, as well as the right to reject all proposals. The RFP also required each proposal to adhere to the Airport’s minimum standards, which at that time explicitly forbade “through-the-fence” commercial operations such as Jet-Away’s.
The County formed an independent cоmmittee to evaluate the FBO proposals that were submitted and to make a recommendation to the BOCC regarding whether it should accept one or more of the proposals or decline to privatize FBO operations at the Airport. As it turned out, the County only received two proposals— one from JetAway and one from JCP. Upon evaluation of the proposals, the independent committee recommended against privatizing FBO services at the Airport. Nevertheless, the BOCC voted to enter
On December 5, 2005, the County officially privatized FBO services at the Airport and entered into an FBO agreement with JCP that permitted JCP to provide these services on Airport property. That same day, with the assistance of Mr. Scott, the County adopted revised minimum standards for the Airport. Many of these reformulated standards, according to JetA-way, made it difficult (if not impossible) for JetAway or any other FBO service provider to effectively compete with JCP.
Despite these setbacks, JetAway continued to negotiate with the County in an attempt to become a second FBO service provider at the Airport. But according to JetAway, the County and JCP were determined to thwart its efforts to compete with JCP in the FBO services market. For example, JetAway has provided evidence that County Attorney Robert Hill was in communication with JCP regarding JetA-way’s proposal to the BOCC to acquire on-Airport land from which to operate its FB O-services business and that Mr. Hill advised JCP to take action in light of this information to prevent JetAway’s acquisition of the land. In the end, the BOCC rejected JetAway’s proposals.
JCP began to provide on-Airport FBO services in January 2006. Around this time, JetAway was fueling aircraft on-Airport without the County’s consent. In November 2008, the County sought a preliminary injunction to terminate JetAway’s access to the Airport, alleging that JetA-way violated several Airport safety rules in the course of running its business. The state court agreed with the County and issued a preliminary injunction. Thereafter, the County prevented JetAway from accessing Airport property, and JetAway’s off-Airport operation has been closed ever since.
B
JetAway filed the instant action against Defendants in December 2007, alleging violations of §§ 1 and 2 of the Sherman Act and, pursuant to 42 U.S.C. § 1983, violations of the Equal Protection Clause and the Commerce Clausе.
Governmental Defendants then moved for summary judgment on all of JetAway’s claims. As to JetAway’s antitrust claims,
Defendants subsequently filed a second motion for summary judgment, which the district court granted as to all claims. The district court concluded that JetAway’s claims under the Equal Protection and Commerce Clauses were meritless. As to JetAway’s antitrust claims, the district court concluded this time that the Noerr-Pennington doctrine shielded Non-Governmental Defendants from antitrust liability.
Most important for purposes of this appeal, the district court concluded that Jet-Away did not have antitrust standing to bring any of its antitrust claims. The district court reached this conclusion by focusing on the report of JetAway’s antitrust expert, Dr. Philip B. Nelson, which stated that the demand for FBO services at the Airport was only sufficient to support one FBO service provider. In light of Dr. Nelson’s report, the court reasoned that “[i]n essence, [JetAway] admits that the size of the business opportunity at the Airport limits that market to a single FBO operator.” Aplt.App. at 6865 (Mem. Op. & Order, filed Mar. 28, 2012).
The district court acknowledged JetA-way’s contention that “the defendants’ protection of JCP from later entry by JetA-way has caused injury to the users of the Airport by subjecting them to higher prices and inferior services.” Id. However, drawing further on Dr. Nelson’s report concerning the timing of such competition, the court concluded that any competition between JetAway and JCP would have been relatively short-lived. Specifically, the court stated that “while there may be a period of competition between two competing [FBOs], for a limited time, perhaps one year, the market can sustain only one operator.” Id. It reasoned that the possibility of such temporary competition did not militate in favor of a finding of antitrust injury. In this regard, the court stated, “It is well established law that the anti-competitive conduct that violates the Sherman Act must have more than a temporary effect on the market.” Id.
The district court thus ultimately determined that, because ordinarily the Sherman Act does not protect one monopolist from the efforts of another aspiring monopolist to rеplace it, JetAway could not establish that Defendants caused an antitrust injury. Consequently, JetAway could not establish antitrust standing. The court’s antitrust-standing determination was sufficient to shut the door on JetAway’s antitrust claims. However, the court proceeded to reach the merits of those claims. Among other things, the court observed: “[T]he allegation is that the County had selected JCP to be the FBO operator even before issuing the RFP. The disputed evidence may support that finding. That, however, is not illegal [under the antitrust laws].” Id. at 6863. The court further opined, “It may be that the Commissioners who signed the FBO agreement with JCP did not act in the best interest of their constituents and permit
JetAway appeals from the district court’s grant of summary judgment to Defendants. Governmental Defendants cross-appeal the district court’s decision denying them state-action immunity.
II
This court “reviewfs] a grant of summary judgment de novo, applying the same standard as the district court.” Automax Hyundai S., LLC v. Zurich Am. Ins. Co.,
III
JetAway focuses all of its efforts on appeal on its antitrust claims.
A
Section 4 of the Clayton Act gives private parties, such as JetAway, the power to enforce federal antitrust laws. See 15 U.S.C. § 15(a) (“[A]ny person who shall be injured in his business or property by rea
To pursue such claims under § 4 of the Clayton Act, a plaintiff must demonstrate not only that it has standing under Article III of the Constitution, but also that it has antitrust standing.
Whether a plaintiff has suffered an antitrust injury is a “threshold inquiry.”
Put another way, an antitrust injury is “an injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendants’ acts unlawful.” Tal,
“The [Sherman Act] directs itself not against conduct which is competitive, even severely so, but against conduct which unfairly tends to destroy competition itself.” Spectrum Sports, Inc. v. McQuillan,
Moreover, the Sherman Act’s goal of preventing unfair competition is pursued with an eye toward safeguarding the benefits that consumers derive from a competitive marketplace. See Novell, Inc. v. Microsoft Corp.,
Generally speaking, “the antitrust laws ... protect competition, not competitors.” Fischer,
In accord with these principles, the Sherman Act is not concerned with overly aggressive business practices, or even conduct that is otherwise illegal, so as long as it does not unfairly harm competition. See Four Corners Nephrology Assocs., P.C. v. Mercy Med. Ctr.,
Thus, consonant with the Sherman Act’s statutory concerns, “[t]he antitrust injury-requirement ensures that a plaintiff can recover only if [its injury] stems from a competition-reducing aspect or effect of the defendant’s behavior.” Elliott Indus.,
B
JetAway contends that it suffered an antitrust injury because Defendants engaged in anticompetitive behavior in the FBO services market by manipulating the bid process rather than allowing market forces to determine which company was the superior FBO service provider. More specifically, JetAway argues that once the County sent out the RFP—initiating an ostensibly competitive bid process—then, in fact, it had “to be a fair and competitive bid process; it [could not] be manipulated.” Oral Argument at 3:28, JetAway Aviation, LLC v. Bd. of Cnty. Comm’rs (Nos.12-1173, 12-1194). JetAway asserts that Defendants engaged in precisely such manipulation, unfairly putting a finger on the scales in favor of JCP. The unlawful result, as JetAway sees it, is that it was kept out of the Airport’s FBO services market and not permitted to compete head-to-head with JCP.
As previously stated, the district court disagreed, reasoning as follows. Based on the report from JetAway’s own expert, Dr. Nelson, the market for FBO services at the Airport could only sustain one FBO service provider,
For the reasons that follow, I am in substantial agreement with the district court. The district court appropriately identified the material facts that are not genuinely disputed and, in my view, applied sound legal principles to those facts in concluding that JetAway could not establish an antitrust injury. Therefore, like the district court, I conclude that JetAway lacks antitrust standing.
1
Notably, the district court’s universe of genuinely undisputed material facts was based in large part on the testimony of JetAway’s own expert, Dr. Nelson. In his report, Dr. Nelson set forth the “structural characteristics” of the relevant market, which he defined as the market for FBO services at the Airport. ApltApp. at 3186 (Expert Report of Philip B. Nelson, Ph.D., dated July 15, 2011) (capitalization altered). He noted that, following Defendants’ allegedly anticompetitive conduct, “JCP [was] the only competitor in the relevant market[], which implies that its market share [was] 100%.” Id. Next, he analyzed the likelihood of other entrants into this market and concluded that other than JetAway, there were no probable entrants. Important for purposes of this appeal is one of the bases for Dr. Nelson’s conclusion—namely, that “[t]here [was] only enough demand for FBO services at the Airport to support one FBO.” Id. at 3190. Thus, according to Dr. Nelson, the market could only support one FBO provider; it would be either JCP or JetAway.
As a foundation for his assessment of damages, Dr. Nelson reiterated this conclusion; “But for the alleged anticompeti-tive conduct related to the contract selection process, JetAway would likely have been the only FBO at [the Airport].” Id. at 3200 (capitalization altered) (internal quotation marks omitted). Dr. Nelson
Dr. Nelson summarized his position as follows: “but for the alleged unlawful behavior, JetAway would have negotiated with the County after submitting its RFP response and would have been selected as the sole FBO at Montrose Airport (or JCP would have decided not to compete if it had also been selected).” Id. at 3203. He explained that, in the “less likely event” that JCP decided to enter the market anyway and compete with JetAway, “there would have been a short period” of competition that would have led to a reduction in JetAway’s profits “associated with this short competitive period.” Id. at 3203 n. 377 (emphases added). He then calculated the “but-for” damages as if JetAway had been the only FBO service provider from January 2006 forward. Alternatively, Dr. Nelson projected JetAway’s damages if, as a result of this litigation, JetAway were permitted to enter the market in January 2012. Under that scenario, Dr. Nelson recognized that “JCP might not immediately stop operations,” so he assumed that “JCP would continue to operate its business at a loss for one year before ceasing operations.” Id. at 3208 (emphasis added).
JetAway attempts on appeal to undermine its own expert’s characterization of the market in several ways, none of which are availing. First, JetAway argues that there is a genuine dispute of material fact as to whether the FBO services market at the Airport would inevitably be controlled by a monopolist. But the evidence on which JetAway relies does not cast doubt on Dr. Nelson’s conclusions.'
JetAway specifically points to JCP’s representations to the County that two FBOs could compete at the Airport. In May 2005, the County asked JCP whether it would still consider its FBO services proposal viable if the County were “obligated to allow additional FBO operators.” Id. at 6679 (Letter from Cnty. to JCP, dated May 27, 2005). JCP responded that the presence of additional FBO providers “would not necessarily change the viability of’ its proposal, so long as potential competitors were subject to the same requirements as JCP, because JCP intended to outperform the competition. Id. at 6682 (Letter from JCP to Cnty., dated May 31, 2005). JetAway also cites the County’s representations to the Federal Aviation Administration (“FAA”) that a second FBO operator at the Airport would be feasible.
However, as I see it, this evidence is not inconsistent with Dr. Nelson’s report and does not create a genuine dispute of material fact. This is so because Dr. Nelson’s report expressly contemplated that JCP and JetAway might occupy the market together as competitors, but concluded that this circumstance would only briefly exist. Ultimately, as suggested by that expert report, the market would be perforce controlled by a lone monopolist. Therefore, JCP’s and the County’s representations regarding the feasibility of a second FBO in the market are in no way inconsistent with Dr. Nelson’s ultimate, critical conclusion that “[t]here is only enough demand for FBO services at the Airport to support one FBO.” Id.- at 3190. Expressed another way, any seeming in
JetAway attempts, however, to cast doubt on whether any period of competition that might have occurred actually would have been short. To do so, JetA-way points to evidence that the County and another company simultaneously provided FBO services at the Airport for a three-year period during the late 1980s and early 1990s. But evidence of a three-year period of competition approximately fifteen years before the time period at issue here does not place in dispute Dr. Nelson’s conclusion that, as the market stood at the relevant time, a short period of competition between JCP and JetAway would quickly have driven one of the two out of business.
Finally, JetAway argues that Dr. Nelson’s one-year estimate regarding the period of possible competition between JCP and JetAway was made only for purposes of estimating damages, and thus the true period of competition that would have resulted between the two FBOs is unknown. However, it was not the precise period of competition between the two FBOs that the district court deemed to be the material fact; rather, it was the fact that any such period of competition would have been short. And Dr. Nelson’s report unequivocally supports the notion that any period of competition, at most, would have been short.
Thus, even disregarding the one-year figure, the record was not silent or uncertain concerning the period of any competition. It is that “short”—or, as the district court called it, “limited”—time frame of competition, and not the more specific one-year period, that formed the predicate for the district court’s legal conclusion that the timing of any competition did not advance JetAway’s cause to establish antitrust injury. See id. at 6865 (stating that “while there may be a period of competition between two competing [FBOs], for a limited time, perhaps one year, the market can sustain only one operator” (emphasis added)). Therefore, the district court’s legal reasoning had support in the record concerning the length of any competition.
2
In my view, the district court correctly determined that applying these antitrust principles to the genuinely undisputed material facts—most notably, the facts coming from the testimony of JetAway’s own expert, Dr. Nelson—doomed JetAway’s effort to demonstrate an antitrust injury.
a
To start, the district court correctly understood that the mere fact that one monopolist is able to successfully replace another does not harm competition and, therefore, does not effect an antitrust injury. See Herbert Hovenkamp, Federal Antitrust Policy 663 (4th ed.2011) [hereinafter “Hovenkamp”] (“[I]f the plaintiffs only claim is of the nature T, rather than the defendant, was entitled to be the monopolist,’ then the plaintiff is not a victim of antitrust injury.”); see also Fishman,
Regardless of which entity controls a monopoly, it remains “free to reduce output and increase prices, the standard evils of monopoly power.” HyPoint Tech., Inc. v. Hewlett-Packard Co.,
b
The district court also correctly discerned the legal significance of the undisputed material facts regarding the second critical point. Specifically, there was no genuine dispute (as discussed supra) that if there were a period of competition between JetAway and JCP, it would have been a short one. The court rightly determined that this meant that any purported deprivation of consumers of the benefits of such competition was of no material significance for purposes of determining the presence of antitrust injury. Putting the
In particular, JetAway asserts that there is no dispute that “JetAway’s entry to the market would have led to significant reductions in prices for FBO services at the Airport, if not an all-out price war.” Aplt. Opening Br. at 33; see also Aplt. Reply Br. at 14-15 (“Defendants also claim that even if prices did decrease, such a decrease would last only one year, which is not a sufficient length of time to constitute harm to competition.... [T]his diminishes the competitive importance of the drop in prices that consumers would have enjoyed during that period of time”). In effect, JetAway reasons that Defendants’ purported anticompetitive conduct in excluding JetAway from the Airport’s FBO services market should be found to have harmed consumers and caused an antitrust injury because it denied consumers the benefits (notably, lower prices) of direct competition between JetAway and JCP— even if those benefits would have only been of limited duration (that is, temporary). I find it pellucid, however, that the district court’s contrary reasoning was firmly rooted in settled principles of antitrust law.
In divining the presence of an antitrust injury, courts have disregarded temporary anticompetitive effects. See Adaptive Power Solutions, LLC v. Hughes Missile Sys. Co.,
Were temporary effects on competition sufficient, an “ordinary business tort” and an antitrust violation would often be indistinguishable. See IIIB Areeda, supra, ¶ 782a, at 321 (explaining that to avoid invoking § 2 of the Sherman Act “on the basis of torts with insignificant market effects[,] ... [t]he antitrust court must ... insist on a preliminary showing of significant and more than temporary harmful effects on competition”); see also Colo. Interstate Gas Co.,
Consequently, in discerning the presence of unlawful anticompetitive conduct, courts have focused on the long-term impact of firm conduct on prices, even when the short-term effects might appear (at first blush) to be beneficial to consumers. See Atl. Richfield Co.,
Here, the anticompetitive effects were the product of Defendants’ allegedly improper exclusion of JetAway from the Airport’s FBO services market, where JetA-
In other words, the benefits flowing to consumers from a competitive FBO services market and the anticompetitive effects of Defendants’ allegedly unlawful conduct—which prevented such a competitive marketplace from emerging—were, in a sense, two sides of the same coin. And, importantly, the coin was made of perishable stuff. After the competition between JetAway and JCP ceased, the market would naturally have become once again the preserve of a sole monopolistic firm— and, as noted, the existence of a monopoly is not itself anticompetitive or a violation of the antitrust laws.
3
In sum, the foregoing evidence demonstrates that JetAway cannot establish antitrust injury and thus cannot establish antitrust standing. The undisputed evidence reveals that the FBO services market would be controlled by a monopolist because there was insufficient demand for FBO services at the Airport to support two FBO firms. As discussed supra, ordinarily the identity of the monopolist is of no concern to the antitrust laws because the simple act of one monopolist replacing another does not adversely affect competition. See Columbia River,
C
Next, I would expressly address and reject two broad lines of argument advanced by JetAway by which it seeks to undermine the district court’s conclusion that it has not established an antitrust injury.
1
Relying on this court’s decision in Full Draw Productions v. Easton Sports, Inc.,
A brief examination of the facts and reasoning in Full Draw demonstrates why its conclusion is not controlling here. In Full Draw, the plaintiff was an archery trade-show promoter who brought an antitrust suit against several defendants who were archery-product manufacturers and distributors and also a trade association to which the other defendants belonged. See
According to JetAway, the reasoning of Full Draw prompts the same conclusion here. As was true in Full Draw, says JetAway, there were two competitors in the Airрort’s FBO services market—it and JCP—and Defendants’ anticompetitive conduct effectively precluded JetAway from competing in the market. However, the structure of the market in Full Draw was markedly different than the structure here—notably, prior to the commencement of the allegedly anticompetitive conduct, consumers in Full Draw had a meaningful choice between two competitors, and we found this fact to be significant in evaluating whether the defendants’ conduct produced an antitrust injury. In that regard, we reasoned:
In particular, as alleged in the second amended complaint, from 1995 to 1997, both [the trade association] and the [plaintiff] competed for customers for their 1997 trade shows. Thus, from the market’s perspective, there were actually two competitors during that period. As a direct result of defendants’ boycott, [the plaintiff] was driven from the market in 1997, thereby depriving consumers of their pre-existing choices in that market. Because defendants’ alleged boycott reduced a competitive market of two producers to a market of one monopolist, [the plaintiff] quite clearly alleged substantial injury to competition from defendants’ group boycott.
Id. (emphasis added).
It should be patent that the effects of the defendants’ allegedly anticompetitive conduct in Full Draw differ from the effects of Defendants’ allegedly anticompeti-tive conduct on the FBO services market here. As detailed above, the undisputed evidence is that, in all events, there would only be one FBO service provider at the Airport. This was not because of Defendants’ conduct, but because “[t]here is only enough demand for FBO services at the Airport to support one FBO.” Aplt.App. at 3190. The natural composition of the market here consists of one FBO—that is, one monopolist. Thus, unlike in Full Draw, Defendants’ allegedly anticompetitive conduct did not have the effect of “reducing] a ... market of two [service providers] to a market of one monopolist,”
2
JetAway’s final attempt to carry its burden of demonstrating an antitrust injury is also unavailing. It argues that the requisite harm to competition needed to show antitrust injury is evinced by the decline in the quality and quantity of the FBO services at the Airport that occurred as a result of Defendants’ exclusion of JetAway from the market.
Specifically, JetAway contends that, had Defendants not excluded it from the market, it would have provided higher quality FBO services than JCP and more of them. JetAway further claims it would have done so even after it drove JCP from the market and was the sole monopolistic firm, because of its superior facilities and Airport location. Thus, reasons JetAway, Defendants’ anticompetitive conduct harmed consumers. This argument is legally infirm. Most saliently, even if JetAway would have been a better monopolist for consumers in the sense that it would have provided a more diverse, higher-quality array of FBO services, it cannot be said that Defendants’ conduct harmed competition; thus JetAway cannot establish an antitrust injury. Cf. Davis, supra, at 742 (“Choosing A over B as one’s exclusive distributor for a territory is not an antitrust violation at all, because whether A is chosen or B is chosen, competition remains the same. There was no predicate antitrust violation.” (footnote omitted)).
It is true, as JetAway contends, that “[a]n antitrust plaintiff must prove that challenged conduct affected the prices, quantity or quality of goods or services, not just his own welfare.” Mathews v. Lancaster Gen. Hosp.,
Such changes in quantity and quality in the market may well be the consequences of harm to competition—viz., the presence of such changes may provide the foundation for a reasonable inference that competitive harm is also present. See, e.g., Syufy Enters.,
Were this court to find antitrust injury whenever a would—be monopolist maintains that in a particular case it would be a better monopolist for consumers than the incumbent monopolist due to the comparative quality of the goods or services that it would provide, we would lose sight of the injury that the antitrust laws are meant to guard against—injury to competition— which “[experience teaches ... is almost always good for the consumer.” Novell,
Notably, the thrust of JetAwa/s argument—that the quality and quantity of a monopolist’s products and services should be deemed relevant to the antitrust-injury inquiry—is directly at odds with the principle that the identity of a monopolist is of no concern to antitrust law. See, e.g., Brunswick Corp.,
However, antitrust injury cannot be predicated on a court’s evaluation of the quality or quantity of a would-be monopolist’s products or services,- rather than on an evaluation of whether competition would be reduced in the relevant market. Cf. Expert Masonry,
Courts lack a principled method to determine which services provide greater benefit to consumers. See Re/Max Int’l, Inc. v. Realty One, Inc.,
Just as the Supreme Court has acknowledged that the federal courts are “ill suited ‘to act as central planners, identifying the proper price, quantity, and other terms of dealing,’” Pac. Bell Tel. Co. v. Linkline Commc’ns, Inc.,
In the end, this case is simple. JetAway “does not ask us to prevent a monopoly or break one apart,” Four Corners,
IV
Finally, given the per curiam disposition of this appeal, I pause to address certain concerns raised by my very esteemed colleaguе, Judge Tymkovich, in his own concurring opinion (“Tymkovich Concurrence”). Although that opinion accepts the overarching, fundamental conclusion that JetAway has not established the requisite antitrust injury, it declines to “underwrite some of the specifics” of my analysis. Tymkovich Concurrence at 1.
In my view, the approach of the Tymko-vich Concurrence suffers from two salient, critical flaws. First, it improperly predicates its substantive Sherman Act analysis, and its view of the antitrust-injury requirement, on a definition of the relevant market that was never advanced by the parties.
A
Antitrust cases frequently present a host of intriguing intellectual detours; that
In light of this enduring legal principle, the Tymkovich Concurrence’s criticism of this opinion’s purported “embrace[]” of a “narrowly defined market,” Tymkovich Concurrence at 4, is puzzling. The antitrust-injury analysis that I have undertaken is predicated.on a relevant market that JetAway itself advanced, that Defendants acknowledged (at least tacitly) as the foundation for their responsive arguments, and that the district court accepted for purposes of adjudicating the summary-judgment issues. In contrast, the contours of the market that the Tymkovich Concurrence sua sponte proffers are entirely a product of the Tymkovich Concurrence’s own hand. While I do not question its assertion that “a federal appellate court has discretion to affirm a grant of summary judgment on any legal grounds supported by the record,” id. at 1 n. 1, given the posture of this case, I believe that the Tymkovich Concurrence’s approach is unwarranted and ill-advised: no one has even hinted at affirming on the alternative grounds it endorses, and the district court did not even have an opportunity to consider, much less rule on, the market that the Tymkovich Concurrence has independently conjured up, see Arizona v. California,
It is well-settled that the plaintiff bears the burden of defining the relevant market, see Tarabishi v. McAlester Reg’l Hosp.,
JetAway then sought to substantiate its market definition with Dr. Nelson’s research results. It is patent from even a cursory review of Dr. Nelson’s testimony that he conceived of JCP—and not the Airport—as being the monopolist, and the “relevant market” as being the Airport’s “FBO Market.” Id. at 3186; see id. (“JCP is the only competitor in the relevant market(s), which implies that its market share is 100%.” (emphasis added)); see also id. (concluding “that the FBO services at [the Airport] and associated product-specific submarkets are well-defined relevant antitrust markets (both with respect to a ‘line of commerce’ (product market) and ‘section of the country’ (geographic market))”). And, when Defendants crossed swords with JetAway, framing the issues for decision, they did not challenge this basic definition of the market. See id. at 2836 (Cnty. Defs.’ Summ. J. Br., filed Aug. 31, 2011) (accepting the premise that “JetAway claims entitlement to be the monopolist FBO at the Airport and bases its damage claim entirely upon being denied monopoly status” (emphasis added)). The district court properly reached its conclusions regarding the relevant market by focusing on the parties’ arguments.
The parties also have maintained this perspective regarding the relevant market on appeal. See Aplt. Opening Br. at 3 (“This case arises from Defendants’ concerted efforts to ... monopolize the [FBO] market at the [Airport].” (footnote omitted)). True to form, JetAway has continued to frame its arguments in terms of its ability “to compete as an on-Airport FBO,” id. at 24, and JCP offers no resistance to this description, see Aplee. Opening Br. at 49 (“JetAway’s claimed antitrust injury is that it, rather than JCP, should be the sole FBO at the Airport” (emphasis added)); Aplee. Opening Br. at 59 (discussing Jet-Away’s “alleged lost ‘opportunity’ to operate an FBO at the Airport”).
Yet, with no foothold in the parties’ firmly-established arguments, the Tymko-vich Concurrence purports to reconfigure and redefine the market out of wholecloth. Given “the principle of party presentation,” Greenlaw,
At the end of the day, it is unnecessary for me to determine whether the Tymko-vich Concurrence’s alternative vision of the relevant market is more appropriate. It would not be proper for me to make such a determination, as the task of defining the relevant market was a matter for the parties—not this panel or, more specifically, the Tymkovich Concurrence—to undertake in the first instance. I note that my concurring opinion should not be read as negating the possibility that—were the facts and the parties’ arguments different—-the district court could have determined that the Airport was the relevant market and also the extant monopolist.
B
The Tymkovich Concurrence also claims to demur to this opinion’s antitrust-injury analysis in that it “cannot agree ... that an upstart in a low-demand, one-firm market can never state an antitrust injury.” Tymkovich Concurrence at 3 (emphasis added). But nor can I. Indeed, it seems patent that the Tymkovich Concurrence misinterprets my antitrust-injury analysis in this regard.
To be clear, as I see it, this concurring opinion does not definitively speak to whether there are circumstances where the antitrust-injury requirement might be satisfied in a monopolist-substitution scenario in a natural-monopoly market. See supra n. 12 (“[T]o the extent that there actually is an open question regarding whether such predatory or exclusionary conduct could give rise to an antitrust injury where the ultimate result is the replacement of one monopolist with another in a natural-monopoly market, I would leave the resolution of that question for another day.”). Again, I find it noteworthy that some commentators have considered the matter an unresolved question. See Davis, supra, at 774-75; cf. Lawrence J. White, Economies of Scale and the Question of “Natural Monopoly” in the Airline Industry, 44 J. Air L. & Com. 545, 573 (1979) (hypothesizing that “[njatural monopoly is not a serious problem for the airline industry,” but cautioning that factors such as “the recent introduction of fare flexibility” suggest the need for “very close scrutiny” (internal quotation marks omitted)). Others have more strongly suggested that such a substitution could give rise to an antitrust injury. See, e.g., Ill Areeda, supra, ¶658b3, at 177-78. On these facts, however, I believe the more advisable approach is to avoid definitively staking out a position on this issue.
Critically, to the extent that an antitrust injury could arise when one monopolist replaces another in a natural-monopoly context, the authorities suggest that such
JetAway has established nothing more than that it sought to supplant JCP as the monopolist in the Airport’s FBO services market—that is, to be the substitute monopolist—and that Defendants allegedly prevented it from doing so by means of various corrupt and unlawful practices. In particular, JetAway has not pointed to, much less offered evidence of, predatory or other exclusionary conduct of the kind that the antitrust laws have historically proscribed.
Alternatively, this case at least arguably might be analogized to the selection of an exclusive distributor for a given market—a species of conduct that also has not been historically condemned by the antitrust laws. See Westman Comm’n Co.,
Yet, even assuming that some misconduct akin to such bidding or exclusive-distributor selections could rise to the level of an antitrust violation—a reasonable assumption I have made for purposes of my antitrust-injury analysis, see supra n. 9—it is clear that JetAway still would be without redress. The Achilles’s heel for JetAway remains its failure to show that any injury that it has suffered from Defendants’ behavior also has had an anticom-petitive effect. Vague allusions to the quality of FBO services or reduced prices cannot overcome this defect. Cf. NicSand, Inc. v. 3M Co.,
Furthermore, I underscore that the “substitution-of-monopolist” rule articulated supra is by no means painted in the broad brushstrokes that the Tymkovich Concurrence suggests. This rule does not perforce safeguard the incumbent monopolist; to the contrary, it is clearly indifferent to the identity of the market actors. More specifically, it is indifferent regarding whether the monopoly is ultimately possessed by the incumbent or the challenger. Stated otherwise, under different facts—such as those involving practices historically condemned by the antitrust laws—a firm like JetAway possibly could mount a legally cognizable objection to being excluded from the relevant market. But those facts simply are not present here; so, although in this case the effect of the “substitution-of-monopolist” rule is to insulate the incumbent (JCP) from liability, that would not necessarily be true in different settings.
In sum, the Tymkovich Concurrence proceeds on a false premise: that this opinion completely rejects the possibility of an antitrust injury resulting from one monopolist replacing another in a natural-monopoly setting. This is an untenable mischaracterization of the instant opinion’s reasoning and conclusions. Consequently, although its analysis strives mightily (and might carry the day under different circumstances), I respectfully suggest that the Tymkovich Concurrence has only succeeded in defeating a straw man.
V
For the reasons stated herein, I would AFFIRM the district court’s grant of summary judgment to Defendants.
. JetAway also alleged that Defendants violated various other federal statutes that preclude the granting of exclusive FBO operations, but voluntarily withdrew that claim before the district court.
. The Noerr-Pennington doctrine “exempts from antitrust liability any legitimate use of the political process by private individuals, even if their intent is to eliminate competition.” Tal v. Hogan,
. State-action immunity, sometimes referred to as Parker immunity, generally immunizes a state from liability under antitrust laws for its anticompetitive behavior. See FTC v. Phoebe Putney Health Sys., Inc., - U.S. -,
. JetAway has declined to pursue on appeal its claims under the Equal Protection and Commerce Clauses by not addressing them in its briefing. Therefore, under our precedent, JetAway has waived any challenge to the district court’s grant of summary judgment to Defendants on those claims. See United States v. Springfield,
. "Under Section 1 agreements 'may be illegal if (1) their purpose or effect is to create an unreasonable restraint of trade, or (2) they constitute a per se violation of the statute.' " Elliott Indus. Ltd P’ship v. BP Am. Prod. Co.,
. "The offense of monopoly under § 2 of the Sherman Act has two elements: (1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power.” Christy Sports, LLC v. Deer Valley Resort Co.,
. The burden to demonstrate antitrust standing is on the plaintiff. See Abraham v. Intermountain Health Care Inc.,
. This court has also looked to the following six factors in assessing a plaintiff's antitrust standing:
(1) the causal connection between the antitrust violation and the plaintiff's injury; (2) the defendant's intent or motivation; (3) the nature of the plaintiff’s injury—i.e. whether it is one intended to be redressed by the antitrust laws; (4) the directness or the indirectness of the connection between the plaintiff's injury and the market restraint resulting from the alleged antitrust violation; (5) the speculative nature of the damages sought; and (6) the risk of duplicative recoveries or complex damages apportionment. Sharp v. United Airlines, Inc.,967 F.2d 404 , 406-07 (10th Cir.1992); accord Elliott Indus.,407 F.3d at 1124 n. 31; Roman v. Cessna Aircraft Co.,55 F.3d 542 , 543 (10th Cir.1995); Reazin v. Blue Cross & Blue Shield of Kan., Inc.,899 F.2d 951 , 962 n. 15 (10th Cir.1990). These six factors "validate” and "give more specificity to the inquiry mandated by the two-part test.” Sharp, 967 F.2d at 407 n. 2. I do not delve into the points of intersection of these two tests, however, because I would resolve this case by concluding that JetAway cannot establish the first prong of the two-part test—antitrust injury. Regardless of which test is applied, antitrust injury is a prerequisite to antitrust standing. See Elliott Indus.,407 F.3d at 1124 ("Antitrust injury and antitrust standing are overlapping concepts; '[standing cannot be established without an antitrust injury, but the existence of an antitrust injury does not automatically confer standing.' ” (alteration in original) (quoting Sharp,967 F.2d at 406 )). Parsing these two tests is unnecessary for the additional reason that the "nature-of-the-plaintiffs-injury” factor of the six-factor test essentially asks whether there was an antitrust injury. See Reazin,899 F.2d at 962 n. 15 ("The nature of the plaintiff’s injury factor is designed to implement the requirement that only antitrust injuries are redressable under section 4.").
. One commentator asserts that, at least in cases where it is obvious that the plaintiff cannot establish an antitrust violation on the merits, it is a "fool's errand" to engage in an antitrust-injury inquiry. Ronald W. Davis, Standing on Shaky Ground: The Strangely Elusive Doctrine of Antitrust Injury, 70 Antitrust L J. 697, 732 (2003); see also IIA Areeda, supra, ¶ 335f, at 76 ("Of course, if the substantive doubt [regarding the existence of anticompetitive conduct] is great enough, the court should grant the defendants summary judgment on the merits, but not by denying standing to sue.”). Putting aside the question of whether such a view could be harmonized with our precedent's conception of antitrust injury as a threshold issue, I believe that taking up the antitrust-injury question first under the circumstances of this case is the prudent course: the parties have extensively briefed the issue, and it provides a sound basis for succinctly resolving their dispute. In following this path, however, I "assume the existence of [an antitrust] violation.” IIA Areeda, supra, ¶ 335f, at 75; see Daniel v. Am. Bd. of Emergency Med.,
. The description of the FBO services market at the Airport offered by JetAway's expert, Dr. Nelson, suggests that the market is akin to a natural monopoly. See, e.g., Nat'l Reporting Co. v. Alderson Reporting Co.,
. Because JetAway cannot establish the first prong of antitrust standing (antitrust injury), I see no need to reach the second prong of thе antitrust-standing inquiry—namely, whether there is "a direct causal connection between that injury and a defendant’s violation of the antitrust laws,” Ashley Creek,
. I recognize that the Seventh Circuit, as well as some scholarly literature, has raised the possibility that, under certain circumstances, even when the end result will be the replacement of one monopolist by another monopolist in a market that naturally can support only one firm, an antitrust injury may still stem from the anticompetitive conduct exhibited by the rival would-be monopolists. See Fishman,
*840 Though the issue seldom arises, one must regard it as an open question whether dirty pool played by one rival in order to keep another rival from gaining a monopoly position counts as antitrust injury in circumstances where there is bound to be a monopoly in any event and the interests promoted by antitrust will not be impacted, one way or another, by which rival wins the monopoly position.
Davis, supra, at 775 (emphasis added).
However, it is important to note that, in the circumstances contemplated by this allegedly open question, a cognizable antitrust injury does not arise from the mere act of substituting one monopolist for another—with no appreciablе reduction in competition—but rather from the distinct "predatory or exclusionary activity," id. at 766, of the monopolist defendant that is calculated to effectuate the substitution. See Fishman,
. This is why JetAway’s argument that it "does not seek to replace JCP as the monopoly FBO at the Airport, but to enter the relevant market and compete with JCP" is unavailing. Aplt. Opening Br. at 35. Had JetAway been allowed to compete with JCP in the FBO services market, only one of the two firms would have survived as the sole occupant of the market—the monopolist—after at most a short period of competition. Therefore, ultimately, the only thing JetAway could have hoped to do by entering the market was to displace JCP, not compete with it.
. JetAway attempts to distinguish Columbia River on two distinct grounds, neither of which is persuasive. First, JetAway argues that Columbia River involved the merits of a § 1 claim rather than antitrust injury, and that these two inquiries are distinct. JetAway is correct that "[t]he purpose of the antitrust injury requirement is different” than the § 1 analysis, and thus each "must be shown independently.” Atl. Richfield Co.,
Second, JetAway asserts that Columbia River, unlike this case, involved a state-sanctioned monopoly. But the reasoning of Columbia River was not dependent on the state-sanctioned status of the monopoly. Moreover, the rationale underlying Columbia River—that competition is not harmed simply by the replacement of one monopolist with another—holds true regardless of whether the monopoly is sanctioned by the state or is dictated by market forces.
. JetAway attempts to distinguish Adaptive Power Solutions, arguing that in that case, following the temporary harm to competition, there was an additional competitor in the relevant market; that is, in the end, competition actually increased. But this fact was not determinative for the Ninth Circuit's ultimate conclusion. Instead, the court focused on the fact that the harm to competition needed to be "more-than-temporary ” and that the harm at issue "was, at most, temporary.” Adaptive Power Solutions,
. In this same vein, JetAway contends that because of Defendants’ anticompetitive exclusion of it from the FBO services market, the prices faced by consumers were higher. Based on the reasoning and authorities explicated supra in Part III.B.2, I find that argument unavailing. In brief, even if I were inclined to find an antitrust injury if it could be shown that Defendants’ allegedly anticom-petitive conduct had the effect of increasing prices for consumers in the long run, JetAway has introduced no evidence to this effect. Jet-Away’s only evidence is that prices would have decreased for a short period during its posited head-to-head competition with JCP. Yet, as noted in Part III.B.2.b, such a temporary effect on prices is of no moment in the antitrust-injury inquiry. See Adaptive Power Solutions,
. More specifically, the Tymkovich Concurrence sad sponte and without reference to the parties' arguments restyles the relevant market. This newly minted market provides the foundation for the Tymkovich Concurrence’s substantive Sherman Act analysis, wherein it concludes that JetAway cannot establish a Sherman Act violation. As noted above, I do not reach the merits of JetAway's Sherman Act claims and only address the threshold issue of antitrust injury. I therefore decline to. accompany the Tymkovich Concurrence down a merits path. Nonetheless, for the reasons explicated below, I believe the Tym-kovich Concurrence's decision to sua sponte reconfigure the market is improper.
. Whether the plaintiff has alleged a violation of § 1 or § 2 of the Sherman Act is of no moment; the same burden applies. Compare TV Commc'ns Network, Inc. v. Turner Network Television, Inc.,
. Indeed, in the FAA proceedings referenced in Part III.B.l, supra, the parties' presentation of the issues was the same. See Aplt.App. at 190 (FAA Dir.’s Determination, dated Nov. 6, 2006) (addressing JetAway’s alleged "right to provide FBO services [at] the Airport” (internal quotation marks omitted)).
. In point of fact, I have expressly limited my conclusions to the facts and evidence presented, see supra n. 12—-just as this court did in Christy Sports,
. Notably, the Tymkovich Concurrence seizes upon Professor Areeda's tеaching that "competition for a natural monopoly can be just as beneficial to consumers as competition within an ordinary market.” Ill Areeda, supra, ¶ 658b3, at 178. But its reliance on this teaching does not get the Tymkovich Concurrence out of the starting blocks. In particular, it is significant that this language appears in a passage seeking to clarify that an "unlawful exclusionary practice” may give rise to an antitrust injury, even in a natural-monopoly context. Id. at 177 (italics omitted). However, as explained supra, I acknowledge—and do not categorically reject— that same possibility. JetAway’s inescapable problem is that it cannot point to an unlawful practice that has been historically condemned by the antitrust laws as the source of its injury. Likewise, the Tymkovich Concurrence cannot escape the critical fact of this case, as established by JetAway’s own expert, Dr. Nelson: that any benefits to consumers associated with a period of competition between JetAway and JCP would only have been temporary. And, as a matter of law, see supra Part III.B.2, I cannot (and therefore do not) permit these temporary effects to dictate my conclusions regarding whether Defendants’ conduct has had a competition-reducing (i.e., anticompetitive) impact on the Airport’s FBO services market. The Tymkovich Concurrence, however, resists this legal conclusion. It contends that this opinion's reliance on two cases is misguided because those cases involved temporary reductions in competition—see Adaptive Power Solutions, 141
Concurrence Opinion
concurring.
JetAway has spun a sordid tale of small-town politics, but it has not described an injury the antitrust laws were designed to protect. And because JetAway cannot establish an antitrust injury, I join the per curium opinion that affirms the district court’s decision below. Beyond this general level, however, I part company with the reasoning Judge Holmes employs in his concurring opinion (“Holmes Concurrence”) to reach this conclusion. Indeed, given the analytical path down which the parties have guided the court—a path the Holmes Concurrence instinctively follows—I cannot underwrite some of the specifics of Judge Holmes’s analysis. Proceeding along a different path compelled by the law, even one not specifically advanced by the parties, is the only way to recognize the realities of the antitrust principles at play in this case.
In particular, I disagree that this entire case is an instance of JetAway seeking to merely substitute one monopoly for another. Part of this case certainly falls under
But the same reasoning does not apply to defendants’ post-bid efforts to prevent JetAway from becoming a second FBO. The relevant market is the Airport, and the Airport has no duty to allow competition for services on its premises. To avoid this conclusion, the defendants credit, and the Holmes Concurrence adopts, a .narrower definition of the market—“FBO services at the Airport.” And since the demand for FBO services would be insufficient to support two FBOs, the before- and-after picture will likely be the same: one on-airport FBO. Under this view, the competition for a natural monopoly is an “elimination bout” with the consumer an uninterested spectator. Thus, no antitrust injury.
Assuming the relevant market is a “natural monopoly,” I .still think competitive forces could play a pro-consumer role. Although Judge Holmes’s reasoning is appealing on its surface, its logic is actually a self-fulfilling prophecy. If demand in a certain market is so low that only one firm can survive, then whether the incumbent firm behaves as a monopolist depends entirely on the rule we adopt. If, as Judge Holmes reasons, the incumbent firm is insulated from antitrust liability because it got there first, then the incumbent will indeed' behave as a monopolist—because we said it can. But if, as I believe, the incumbent firm deserves no privileged position simply by virtue of already being there, then the very threat of an upstart entering the market will at least marginally constrain the incumbent’s ability to extract monopoly rents. That does benefit consumers. And in any event, we have no right to enshrine the incumbent in its monopoly position simply because it is already there. That choice belongs to consumers.
Thus, I cannot agree with the implications of the Holmes Concurrence; namely, that an upstart in a low-demand, one-firm market can never state an antitrust injury.
I therefore write separately to explain what I believe to be the correct reasoning.
I. Analysis
There are two complementary methods of demonstrating the failure of JetAway’s antitrust claims: “by reference to the proper definition of a market or by reference to the absence of anticompetitive conduct.” Christy Sports, LLC v. Deer Valley Resort Co., Ltd.,
A. Market Definition
JetAway brings claims under both Sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 & 2). “To state a cause of action for conduct prohibited under § 2 of the Sherman Act, the plaintiff must define a relevant market within which the defendants allegedly engaged in anticompetitive behavior.” Campfield v. State Farm Mut. Auto. Ins. Co.,
For purposes of summary judgment, the district court accepted JetAway’s expert’s definition of the market as “FBO services at the Airport.” Aplt.App. at 6865. The Holmes Concurrence also embraces this naiTowly defined market. See Holmes Concurrence at 20-21, 35. But in my view, this definition misapprehends the relevant airport market, and does not reflect the underlying economic reality at play.
“The Supreme Court has recognized the economic value of allowing businesses to decide with whom they will deal....” Christy Sports,
The fact that a hospital, ski resort, or stadium might contract with a third party to provide a specific service does not change this:
[ 0]ne is hard-pressed to see any [antitrust] violation in an agreement between, say, Disneyland and McDonald’s, that gives McDonald’s the exclusive right to operate restaurants in the Disneyland park, even if the result is that McDonald’s charges higher food prices in the park than prevail outside. Disneyland could certainly choose to operate its own restaurant in its own park with exactly the same result, and the franchise agreement with McDonald’s would be simply an alternative way of capturing those rewards.
I Phillip E. Areeda et al., Antitrust Law ¶209e3, at 315 (3d ed. 2007) (‘Areeda”).
Although the Montrose Airport is no Disneyland, a materially identical situation prevails here. No one disputes that the Airport may control access to its own premises, nor that FBO services are among the many types of services airlines, pilots, and passengers enjoy when visiting the Airport’s premises. Thus, the Airport may operate its own FBO (as it has done in the past), it may operate its own FBO alongside a competitor (as it has also done in the past
Of course, one might argue that the public nature of the Airport (recognizing the Montrose County Building Authority’s role) distinguishes it from a private business. Many of the cases expounding on the power of a business to restrict competition on its premises rely on the need to allow private firms to recoup their investment. See, e.g., Christy Sports, 555 F.3d at 1194; Elliott,
An aspiring entrant into an airport’s “market” might question a public airport’s statutory authority to monopolize a market within its boundaries, to choose with whom it will deal, or to grant an exclusive concession.
In sum, “FBO services at the Airport” is not a relevant market. Instead, the market includes the full cluster of interrelated services that the Airport offers. Without its narrowly constructed market definition, JetAway has no Sherman Act claim based on defendants’ efforts to thwart JetAway’s desire to establish an FBO at the Airport. As I see it, the Airport faced no antitrust
B. Antitrust Injury
For similar reasons, JetAway has failed to allege a cognizable antitrust injury. “[A] plaintiff can recover [under the antitrust laws] only if [its] loss stems from a competition -reducing aspect or effect of the defendant’s behavior.” Atl. Richfield Co. v. USA Petroleum Co.,
1. The Bid Process
Before the County called for bids, it ran the Airport’s sole on-airport FBO. There had been no competition for over ten years. The County then ostensibly opened the bidding for the chance to assume the County’s FBO operations. JetAway claims that JCP’s connections to the County made the result of the bidding a foregone conclusion, and even insinuates that JCP had an opportunity to change its bid in response to JetAway’s.
The question, then, is whether a corrupt bid process reduces competition when the parties are bidding for an exclusive concession—or more specific to this case, when the parties are bidding to take over a portion of the monopolist’s business that the monopolist had been running itself. The answer is no. Even had the bid process been clean, the result is the substitution of one firm for another, leaving competition—or the lack thereof—unchanged. “[Substitution of one monopolist for another is not an antitrust violation.” FTC v. Phoebe Putney Health Sys., Inc., - U.S. -,
With this much, I agree with Judge Holmes. The fact that JetAway had been operating a through-the-fence FBO does not change this. Even if we considered JetAway’s off-airport operations relevant to the preexisting state of competition, the result from the consumer’s standpoint is either the same or worse. When JetAway lost the bidding process, the status quo remained: one on-airport FBO and one off-airport FBO. Had JetAway won the bidding process, the consumer would have been left with a single FBO. Accordingly, JetAway cannot state a harm to competition with regard to the bid process at issue in this case, even if it was corrupt.
2. Post-Bid Efforts to Prevent a Second FBO
JetAway’s other claim that defendants have conspired to exclude a second FBO likewise fails.
Again, no one disputes that the Airport may control its own premises. Thus, if the district court enjoined the Airport to allow JetAway to open an on-airport FBO, we would then have two on-airport FBOs, both operating under the Airport’s control. JetAway assumes that such an arrangement would lead to competition, but the Airport has no antitrust duty to allow competition on its premises. In that respect, the Airport is like the defendant hospital in our recent Four Comers Nephrology decision. A nephrologist, Dr. Bevan, had sued a hospital under the antitrust laws to force the hospital to give him staff privileges, allowing him to compete with the hospital’s in-house nephrology department. But, we said,
even if we were to force [the hospital] to accommodate Dr. Bevan’s demand, the*860 hospital could simply impose costs and conditions on Dr. Bevan’s activities that would prevent- him from undercutting the hospital’s own nephrology practice. Dr. Bevan very well might be better off with .such a shared monopoly, but there’s no guarantee consumers would be. Whatever injury he may have suffered, then, it is not one the antitrust laws protect.
Four Corners Nephrology,
3. The Holmes Concurrence’s Analysis
The foregoing analysis suffices to dispose of JetAway’s claim that defendants have conspired to exclude a second FBO. Judge Holmes, however, employs different reasoning in his concurrence. By merging JetAway’s claims related to the corruption of the bid process with its claims that defendants subsequently orchestrated to prevent JetAway from becoming a second FBO, -Judge Holmes relies exclusively on the substitution-of-monopolist rule to reject the latter claims. Because the circumstances underlying each claim are distinct, I believe the Holmes Concurrence underestimates the scope of its premise with respect to the injury alleged concerning the post-bid process.
Judge Holmes, like defendants, bases his conclusion regarding defendants’ post-bid exclusionary efforts largely on JetA-way’s expert, who opined that the relevant market was “FBO services at the Airport” and, in his view, “[t]here is only enough demand for FBO services at the Airport to support one FBO.” Aplt.App. at 3190. In estimating JetAway’s damages, the expert also assumed that competition between JCP and JetAway—if permitted—-would last only about a year, after which JetA-way would prevail. Aplt.App. at 4834, 4981, 6959. Defendants therefore argue: (1) the short period of competition JetA-way’s expert anticipates is not enough to state an antitrust injury, and (2) ultimately JetAway is sеeking to substitute one monopolist for another. Defendants argue, in essence, that providing FBO services at the Montrose Airport is a natural monopoly. Cf Richard A. Posner, Economic Analysis of Law § 12. 1, at 460 (8th ed. 2011) (“[I]f a market is small enough, almost any kind of firm can have a natural monopoly—a grocery store in a village, for example—because every firm has some fixed costs, and they may dominate total costs if demand is low enough.”).
This reasoning goes down an anticom-petitive path. Defendants have cited no persuasive authority for the notion that a projected short period of competition (should the plaintiff prevail on its antitrust claim) somehow vitiates antitrust injury. Indeed, defendants’ cited authorities stand for the converse. In Adaptive Power Solutions, LLC v. Hughes Missile Systems Co.,
The crucial problem with defendants’ argument is the failure to distinguish the significance of the Airport’s ownership of its premises from the significance of low demand. As explained previously, it is the Airport’s control over concessionaires that undermines JetAway’s claim of antitrust injury—concessionaires may only compete on the terms set by the coneession-gran-ter, which do not altogether coincide with the interests of the consumer. But defendants argue (and Judge Holmes agrees) that low demand (or the “natural monopoly”), regardless of the Airport’s control of its own premises, is enough to invoke the substitution-of-monopolist rule.
Assuming for sake of argument that a public airport has a duty to open its premises to freewheeling concessionaire competition, its failure to do so is—right now— reducing competition, which is the essence of antitrust injury. This is so even if the sought-for competition is inevitably a winner-take-all contest. “[C]ompetition for a natural monopoly can be just as beneficial to consumers as competition within an ordinary market.” Ill Areeda, ¶ 658b3, at 178 (emphasis in original). Among other things, the threat of potential competition for a natural monopoly will force the incumbent to lower its prices, knowing that upstarts may be waiting in the wings. Id. In any event, during the one-year competition period forecasted by JetAway’s expert, pilots and airlines could play one FBO against the other for the best long-term deals—futurеs contracts, essentially—thus preserving lower prices for a longer term than the competition period itself. And again, as long as the victor knows that an upstart could potentially invade its market, monopoly pricing power is constrained.
I am not aware of any principle of antitrust law which can convert such competition-enhancing possibilities into a lack of antitrust injury. “If monopoly power can be used to beget monopoly, the [Sherman] Act becomes a feeble instrument indeed.” United States v. Griffith,
And in the antitrust realm, there is every difference in the world between a monopolist anointed by consumers and a monopolist anointed by itself. See Trinko,
To hold otherwise could effectively mean that a defendant is entitled to remain free of competition unless the plaintiff can prove, not only that he would be a viable competitor, but also that he and defendant both would survive. This result would be ironic indeed: we cannot say that it is in the public interest to have the incumbent as ... its sole football team, merely because the incumbent got there first.
There is no good reason to treat airport FBO services differently. Assuming, again, that the Airport must open its premises to FBO competition, and that the Airport has only enough demand for one FBO, “[the] choice [between the upstart and the incumbent in a natural monopoly] should in the first instance be made by consumers.” Ill Areeda, ¶ 658b3, at 178. And JetAway in fact argues in this case that its now-shuttered through-the-fence FBO could provide better services to the consumer in the form of a more convenient location, larger hangar and terminal, more ramp space, and more fueling capacity. See Aplt. Opening Br. at 32-33.
To be sure, a defendant may offer evidence of low demand to support an argument that it operates in a natural monopoly—but this only rebuts any inference of illegality flowing from the defendant’s position as a monopolist. See Hecht,
Finally, defendants’ overarching substitution-of-monopoly argument depends entirely on assumptions about demand. But natural monopolies can evaporate as circumstances change, and demand is a circumstance that can fluctuate wildly. Prospectors in the Uncompahgre Valley could discover a new mineral deposit and Mont-rose could become a mining boomtown, leading to increased traffic at the Airport and enough demand for two or more FBOs. Cf. III Areeda, ¶ 658b3, at 177 (arguing against giving protected status to an incumbent natural monopolist because, among other, reasons, “technology may change a market from a natural monopoly to one in which rivalry is efficient” and any protected natural monopolist would have an incentive to stifle such innovation).
“[T]he ultimate issue is whether the plaintiff (1) seeks to join the exclusive arrangement while leaving the exclusivity requirement otherwise intact; or (2) seeks to forbid exclusivity, first on its own behalf, and implicitly on behalf of others.” IIA Areeda, ¶ 348el, at 217. JetAway sees itself under the second prong, and as between the second prong and the Holmes Concurrence’s substitution-of-monopoly argument, JetAway is closer to correct.
Unfortunately for JetAway, the closest to correct is actually the first prong. As noted, this case turns not on demand for FBO services at the Airport, but on the Airport’s control of its own premises. The Airport has no antitrust duty to open its premises up to concessionaire competition. If it did, however, then the demand-created natural monopoly would be no defense to antitrust liability.
II. Conclusion
For the reasons stated above, I would affirm the judgment of the district court.
. It is widely accepted, if not axiomatic, that a federal appellate court has discretion to affirm a grant of summary judgment on any legal grounds supported by the record. Signature Dev. Cos. v. Royal Ins. Co. of Am.,
. Judge Holmes constructively attempts to circumscribe the scope of his concurrence by acknowledging that his recommended "rule does not perforce safeguard the incumbent monopolist.” Holmes Concurrence at 60. While I certainly agree, that conclusion is significantly concealed by an approach, which, in so many ways, drives at its antithesis. An attentive reader might find the limiting principle, but the incautious reader will find authority that аcts as bulwark for the incumbent in a natural-monopoly market.
. For several years prior to 1991, the County had two full-service, on-airport FBOs—a privately run FBO and the County’s own FBO. Aplt. Opening Br. at 6-7.
. JetAway's expert was instructed to assume that the County was "acting in a proprietary capacity as the operator of the Montrose Airport and as the historical provider of FBO services at the Airport,” but "[o]nce the County decided to privatize the Montrose Airport, the County was obligated to select one or more private FBOs ... through a competitive bidding process to promote public interests.” Aplt.App. at 4842.
. JetAway concedes that the County’s efforts to shutter JetAway’s through-the-fence FBO have no relevance here. Aplt. Opening Br. at 20 n.19 ("The disputes between the County and JetAway concerning its former off-Airport operation, closed now for over 3 lk years, are irrelevant to JetAway's antitrust claims asserted herein.”).
. The Holmes Concurrence also cites Colorado Interstate Gas Co. v. Natural Gas Pipeline
. In response to Judge Holmes’s discussion about the limits of the judiciary to select the superior monopolist in an antitrust case, Holmes Concurrence at 40-48, I note that I reach my conclusion without any judgment on whether JetAway could ultimately provide better FBO services for consumers. Yes, Judge Holmes is right that the specific “identity of a monopolist is of no concern to antitrust law.” Id. at 45. But the identification of a possible upstart to challenge an incumbent’s monopoly in a one-firm market is an entirely different inquiry that does not evaluate which monopolist should (or will) carry the day. The existence of a challenger in a low-demand market can enhance competition and benefit consumers regardless of whether it should (or will) ultimately unseat the controlling monopolist. See III Areeda, ¶ 658b3, at 177-78.
. Indeed, the underlying rationale extends much further. The Holmes Concurrence's position ultimately rests on the futility of permitting competition when one firm is certain to prevail eventually. But if futility is an available argument, then a defendant can win an antitrust case simply by convincing the jury that its product is superior to the plaintiff's and therefore competition will be futile because plaintiff’s business will eventually fail, leaving the market unchanged.