we'll reserve decision the next case we will hear is i q dental supply versus henry schein incorporated good morning lawrence fox duane morris for plaintiff appellant i q dental i want to go straight to the antitrust injury ruling because i think that's really at at the heart of the matter the district court held that i q did not allege an antitrust injury because i q replaced two other distributors who had been selling through these websites the source one dental association web sites and were driven off by the defendant's antitrust conspiracy assuming that i q would not have become a seller through those websites if if the prior competitors had not been driven off here is there some limit to the number of sellers that can that can operate on this website there were two why couldn't have been three there could have been there could only so why would the driving off of the other two be necessary for your client to step in and this was done contractually out my client had to get permission to sell through those website with one from sources and it got that permission got that there was a market distortion that might have helped your client you're saying laws are prepared to recognize as as an antitrust injury there's an antitrust injury now it may be that there could be an offset we don't know it may be that their damages might be mitigated in some way but you're saying that there's still an injury at least for the for the threshold question of whether there's an antitrust injury exactly correct that he it why it where you go to the enforcement side of it that's that's where i think you run into a little more difficulty because why aren't you in a fact a derivative plaintive source one is the one who's really being attacked here and mental trust conspiracy alleged not not your client correct the pressure was applied most directly to source one record it doesn't mean that one source want a better plan if th i don't believe i don't believe so you're under no circumstance in fact the way while your better plan well first of all why are you as good a player we are we are as good a plan to first first the notion that our injury is derived from source of one's injury simply is factually incorrect well we some edges are different they got kids they lost commissions you lost lost profits wrecked is that your point i guess no but my point is also this i q sold the product i q received the orders they filled the orders from inventory they ship the product and they received the revenue they then as you as your honor point to that they then paid a commission so very latest at the very least so you are the best plaintiff for i q's injurious is that correct i mean that's that's your argument where the only competitor who has brought a lawsuit and days you said that the that the two the two suppliers that were as it were driven out of business they haven't sued that's correct and now they can but how do we should get inside that's the limitations  mean we have to wait for the statue of limitations to run in order to find out whether a particular plaintive would be an efficient enforcer if there are others out there who would be more efficient and forces and they don't and they can bring a claim or not bring a claim that that that doesn't sort of promote somebody who's not inefficient in force or to efficiency again i think this whole the whole discussion of who's better or who's best who's most efficient is a bit of a red herring fortunately this red herring is somehow found its way into the jurisprudence it is core accepted as as multiple courts as multiple courts said said there there are no cases in which someone is a truly suitable plaintiff and has been denied standing because someone else is also suitable let me ask you this maybe and this might help are there any other potential plaintiffs out there who complain los profits who could still sue let's put it this way after the initial competitors the initial sellers were driven out of the i q excluding them i understand route i understand i dentists are going to say the prices were too high so that's a different measure of damages i'm talking about lost profits is are there other players again i q is ninety percent of the sales through that websites and  they asserted it would be from lost profits during the time that they were a subject to this market distortion plus what they would have earned if they had not been drive driven and a business which is almost exactly what your claim would be am i correct if those if those original sellers had sued then they are they aren't imaginary can they haven't sued but they're not imaginary the people who could plausibly have alleged that they lost sales because of the market distortion and they were driven out of business and then they would claim lost profits inefficient and force or understood you who's left standing your point i think is that if they if it was before the running of their statute of limitations the other side might have a better argument that they were the work fission of forces but now with the statue having run  they can't be enforcers at all and therefore how could they be efficient ones one of the efficient and force or factors is you have to be motivated how can you say that those are motivated plaintiffs if they haven't su in favor of someone who hasn't thought quite in favor of it i think it's sort of stepping back and asking whether whether someone in the position of your client is and efficient and force relative to all of the other actual and potential interests and and players that are potentially involved well again i mean  what if they started the suit and then settled it for peanuts when they decided that antitrust litigation is too expensive which of course it is and and withdrew their suit would that make you more efficient  let me say this your honor if we were all together if if if they had sued and we and we sued yes then an expert would have to project what would have happened what the market what their market share would have been what our market share would have been you can find an expert to testify that the florence the ceiling well that's what but that's what if it meant that that's what would have had to happen there would have to be a projection as to what have what would have devolved and what would the profits have been of these respective players that could be done and it and that's what would be done is there a possibility that your client could intervene in the source one interview in litigation that how are you going to get your how would you assuming if source wise use is successful you you end up claiming damages as a result of the conspiracy which is now established it seems to me you're out of luck unless somehow you if you're not if you're not permitted to go forward here you'd be out of luck in getting any lost profit damages or could that is there somewhere you could get it out of that of a geisha if we can't pursue in our own right i don't believe there is here and that's why it's important that we be permitted to go forward again there is the source as your honor pointed out and this is the d d a v p case their damages are different they're easily separable and they're easily segregated so there isn't there's there's simply no reason why source one can't go ahead and prove its case and there's no reason why we shouldn't be permitted to go ahead and prove our case and recover the damages that that we it's that we've suffered i did want to say one thing of a few more things but one thing in particular we relied on some and we've kind of the real your argument with a lot of questions is here is your one thing you want to add that makes a difference yes i think it does make a difference on the antitrust injury requirement the policy implications of of the decision below are really quite dire and and really quite if that decision were correct then a wrongdoer who drove at a first wave of competitors would then be immunized from liability for many subsequent coming out of the court is saying is that there's something indirect about injuries suffered by somebody who steps into a commercial environment that is already a distorted by  suffer antitrust injuries and just saying i think that's what the court had in mind when the court said that you were you and your business opportunity was to step into a market distortion i think what the court did not appreciate where the implications of this of the decision that it made but also relied on cases in which there was a continuing benefit and here whatever benefit there was was just the fact  you're entering the market and then after that from that point on at least according to your allegations the benefit ceased write it again taped to address to address your comment and you trust law is supposed to it's supposed to protect competition and deterring doing the effect of this decision would be exactly the opposite it would be to protect the wrongdoing to actually reward the wrongdoing with immunity and deter competitors because who is going to who's going to enter a market that's infested with an antitrust conspiracy when the law has withdrawn its protection and the defendants are immunized you reserve three minutes rebuttal thank  case is this about the defendants here protecting a system sales to dentists with individual salespeople as opposed to e commerce is that what this is about have a summer platform like source one but it's not part of this record i'm tied to the record are or the record is that there's a computer is a dispute between which is the best of way to distribute products now i happen to have your client has one w fight e commerce but have you also thought of bailing out the ocean with a teacup i didn't say we were fighting e commerce i'm simply saying i'm tied to the record before the court and the court is so does henry shine offer things by is associated general contractors identified five factors in one nine hundred eighty three this court in implementing those five factors in the gap communications test in two thousand and two thousand and thirteen created two imperatives imperative  imperative one is the court knows whether or not there is a special kind of antitrust injury an imperative to his court knows whether or not there's an efficient or force or hear the judge mechanistically carefully and rigorously judge kogan having source case before him went through and found that step two of imperative one was not satisfied he didn't even need to reach step three although if he had we some that and we've submitted this are brief he would not have said that they were not satisfied it and he found that they you can have the ip but but i'm going to that it matters but why it matters is because if as this goes to the question that your honor is asking footnote forty seven of associated general contractors says that if the more motivated parker parties here distortion and then he's nailed left of that by the conspiracy because of all the t v against my ip i under i understand the argument but the reality here is they have pled the case in a specific way and the pleading is conspirators they never would have had the benefit of operating on the source one program period that's all they thought it and it's not a question of because going to your outer squash them before think about the poor think about what kind of an opinion would you have us right here in other words is is if you give in by virtue of the market distortion you then at that point are prohibited ever from being a plaintive i mean  that's essentially what i guess the rule that one would have to come up with unless it's going to be a one off rule no i was certain that this court has already addressed and decided that question step to  communications asks the question is the plaintiff in a better or a worse position the argument that you are postulating and on behalf of not only have about repeating on behalf of the talent here would mean that step into this isn't this isn't the appellant apple lease you're coming up with a new argument this is driven specifically by the formulaic application of associated general contractors as adopted by this court there are people who are benefited by the intention of conspiracy who want to be players but they're getting it they are getting a kid a continuous ongoing benefit it's not a question of the threshold of getting into the into the market and once once they're in the market it seems to me that you're it depends on where you were you draw the line you start with the injury as of the time the the person starts to be injured where do you start start before that my answer that would be in this case based on the pleading that they filed with this court their complaint they're going to get continuous benefit because they are now part of the source one platform where otherwise they would not be every dollar and that's what the district court found the district court found that every single sale made are you saying that they really have no right under law or equity to do business in an environment that is not distorted no not at all what i'm saying is if they want to have a different platform that they start themselves or someone else they can do that and if there's claims based on the antitrust laws they can bring that case but in this case they played their complaint in a very specific factual way in the district court judge  program properly found that based on the pleadings that they made in this case every single sale that they have ever made and will make is solely because of the benefit they have received that's the question asked by this court in the get case step two imperative one that assume i'm assuming wrong assume that the course says well at some point there's got to be an antitrust injury here of a special kind if it several companies aren't are targeted because of their product by a competing kind of product and various competitors dropped by the wayside as a result of the economic stress caused by the market distortion and your argument would be that the others should be happy that they're targeted by anti competitive activity because they get to absorb the business that had been done by the competitors who fall and fell by the way so that's not my argument all my argument is that in this specific case before the court does allege that there is a market disruptive new platform call source one that had exclusive relation arrangement with d d s and arnold they drop out it was not offered true i q ductile was offered to d h b they declined because allegedly  pressure and so the next person i q don't gets in line in a nail have ninety percent of the source one platform they say and as a district court said based on the else those allegations under step two of get they fail but if you get ninety percent  the source one platform in this worth one platform is is under siege and they're going to get ninety percent of less than what they would have gotten ninety percent of and they were got nothing but for the more efficient antitrust in which is we have to wait for the and if we have to if it's special imitations to expire before we decide no there's a long list of people who are better situated first of all source want to suing for lost profits they say it's just the commissions but that will work on the washers to what and how broad yes i assume the commissions are limited the record here is not as they're going to they're searching for lost profits so their business right and d d s and our old india h p all couldn't pursue those plans so they thought them worthwhile to pursue and they did not for whatever reason now are turning white as pursuing a climb down in texas why why why are they in the equation now well you i don't think you become a i don't think you become a more efficient force or because the people better situated chose not to  fusion forces and leave the ones who are by your lights are less efficient out there is to sue you can still claim that they they are inefficient enforce even though you can't name any more efficient ones that are still viable well the term of the fission of force or test is a four four factor test his not just the identity of others it's whether it's direct or indirect in writing and we know the problems there is whether or not the damages are speculative and remote down the chain of causation of justice holmes great quote that at least in the context of damages we seldom go beyond the first step that's been true for more than a century is particularly true in the antitrust laws and then you have the question of apportionment damages so let's let's play hypothetical because you honor asked the first half of what i want to ask the court in terms of hypothetical let's assume source one gets in there and they go to trial and they lose whereas they have leave i q data they're have is you have a series of of entities up the chain more directly impacted up the chain before i q done told and what they're basically saying is well this one dropped off or so and that one dropped out because they don't want to sue that one dropped out were the last person standing therefore we need to be the ones going forward whether or not the last person standing you have the dentists going forward on this you have arsenal why going forward on this you have source one going forward of this new career is the dinners are not going to be able to claim lost profits  say or they would argue their loss because they didn't sue and especially imitations that's not efficient for just because otherwise if that were true you would simply identify a person last person a standing you wouldn't carry about direct or indirect factor one you wouldn't care about speck of us number two number three you would carry about you know factor for in terms of a portion of them have to do that or if if it turned out that these four factors and i don't know which one i'm talking about you prevailed on one or you reasons it's significant question law is set by gad or as in terms of i get applying associate general contractors that you must find under all circumstances a special kind of antitrust injury that is direct so factor one plus knows a good deal more about this in revenue as you pointed out it has the source one case as well what has twenty five consolidated cases and the duchesse cases and it has the source one that has a dentist cases as well as it does that's that's very deeply enmeshed in the allegations and the facts of these cases and they say he knows how to call balls and strikes in terms of he wouldn't this is so the judge would be in a position to obviate the issue of inconsistent vernix that you raised earlier no i but going back to that your point when this district court judge who knows these issues says and finds in this case i can't figure out a way why they can meet factor for apportionment of damages because it miers me and all the following hypothetical serious remand for the thing to be remain at least in the first instance by the district court this depends upon how the court writes his opinion obviously but in terms of how get remembered get somewhat of a mechanistic test and you know if you find for example no antitrust injury of a special kind or no direct injury then there is nothing to weigh because that's a that's an imperative that must be satisfied if you find that because a statue of limitations and you're going to create a new you're going to craft a new rule under gatt which says basically last person or last entity standing then you say we're does that leave us in terms of factors two and a four because of factors two and  but on the record before this court the only factor that that the plan of his arguing about is to create a new rule which is last entity standing and if they were to create that rule given the problems with factor just to be clear on antitrust injury and i think i think your honour's understand this the problem with the with the district courts approach is that it focuses exclusively on how i q got in and ignores everything else that happened afterwards chronologically there were two major but we cots of these dental association trade shows the texas boycott occurred almost simultaneously with i q coming into this market and signing on the arizona boycott was in two thousand and fifteen that happened after all of the pressure on the manufacturers that happened after ike you signed on the there was a national dental association meeting in which a number of states expressed interest and then they all got scared off all of that happened after i q started selling through the market so the conduct continued after i q joined and the injury occurred after joint on those facts it's simply impossible to say that i q was not injured it's only this very narrowly restrictive view that it has to do with how you got in under which that could be said and there is proof that there is president who has just been told that this district court has a view of the entire a litigation of all the dentists cases so it does make a difference how i q got in doesn't it i don't think how i q got in is in any sense certainly not somewhat relevant but not close to being dispositive of the issue of whether it whether it was injured it was injured because there was a conspiracy to restrict the market that it entered and as a result the market didn't expand in the way it otherwise would have it simply cannot be said that i q was not injured it just your court said that i q was in a better position once source one showed it didn't they didn't they why is that not correct so i think defendants in all of their arguments are overreading the gap case with the gap says is that the second step of the antitrust injury analysis is to identify quote the actual injury the plaintiff alleges unquote by quote looking to the ways in which the plaintiff claims and again to to focus exclusively on how i q got in is is it first of all it's unprecedented and there is a case the law of the n c a a versus law case from the district of kansas that addresses exactly this issue and what the court in that case said in very very comparable circumstances again the n c a a was arguing that there were coaches who wouldn't have gotten their jobs but for this compensation cap that was imposed and that as a result they weren't injured because they should be happy that they got jobs and what the court said in the climactic sentence of its opinion was that it does not matter why the latter got their job or how long they had held regardless of why the jobs were created or how recently those coaches had been employed they were entitled to work in a market that was not infested with a conspiracy to violate the federal antitrust laws so there's exactly one case that addresses this argument in the vastness of antitrust law and it soundly rejects the argument that's been that's that's being made thank you thank you both we will reserve decision