CLIENT UPDATE

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February 15, 2011

Ninth Circuit Antitrust Liability Case To Be Decided En Banc

On August 17, 2010, the Ninth Circuit Court of Appeals ruled that four southern California supermarket chains had violated the antitrust laws by agreeing to share profits in the event of a strike by union-represented employees on one or more of the chains.  State of California v. Safeway, Inc., 615 F.3d 1171 (9th Cir. 2010).  Specifically, that  decision found a great likelihood that anticompetitive effects would result from the profit sharing agreement without any procompetitive justification for such conduct.  The Court also found that the nonstatutory labor exemption, which exempts certain practices from antitrust laws, did not apply to the actions taken by the supermarkets.  

On February 11, 2011, the Ninth Circuit issued an order stating that it had agreed to rehear this case “en banc.”  This means that the case, which had been decided by a panel of three judges, will now be reconsidered and ruled upon by a panel of eleven judges.  Consequently, The original three-judge decision “shall not be cited as precedent by or to any court of the Ninth Circuit.”

We will continue to monitor this important case and will report the en banc court’s ruling.  If you should have any question concerning this case or the intersection of the labor and antitrust laws, please do not hesitate to contact us.