Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_14-cv-05243/USCOURTS-cand-3_14-cv-05243-7/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 28:1337 Sherman-Clayton Act

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

JOSE LUIS GARNICA, et al.,

Plaintiffs,

v.

HOMETEAM PEST DEFENSE, INC., et al.,

Defendants.

Case No. 14-cv-05243-VC 

ORDER DENYING MOTION TO 

DISMISS

Re: Dkt. No. 42

This is a proposed class action by two homeowners who contend they've been forced to 

pay higher prices as a result of HomeTeam Pest Defense's allegedly anticompetitive conduct in the 

market for servicing tube-in-the-wall pest control systems. This case is related to Killian Pest 

Control v. HomeTeam Pest Defense, No. 14-cv-5239-VC, in which one of HomeTeam's 

competitors asserts antitrust claims based on the same alleged conduct. The Court has granted in 

part and denied in part HomeTeam's motion to dismiss in the Killian case. The background facts 

are discussed more fully in that order. HomeTeam has filed a motion to dismiss in this case also. 

The motion is denied.

I.

HomeTeam first argues that the homeowners lack standing to pursue antitrust claims based 

on alleged anticompetitive conduct that took place in geographic markets other than the ones 

where they live. One of the homeowners lives in Fresno, the other in Bakersfield. The Second 

Amended Complaint ("SAC") alleges 37 "individual" geographic markets throughout the country, 

two of which are the Fresno Metropolitan Statistical Area and the Bakersfield Metropolitian 

Statistical Area.1 And the SAC alleges that the homeowners have been injured only where they 

 

1 As with the complaint in the Killian action, the SAC in this case alleges only 36 individual 

markets, because the homeowners' lawyers forgot to include the Fresno metropolitan statistical 

Case 3:14-cv-05243-VC Document 64 Filed 12/21/15 Page 1 of 3
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United States District Court

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live. 

If the homeowners were pursuing claims on behalf of themselves alone, HomeTeam would 

be correct – the homeowners would lack standing to complain of antitrust violations in other 

geographic markets that the SAC describes as separate and individual. See Glen Holly Entm't, Inc. 

v. Tektronix, Inc., 352 F.3d 367, 372 (9th Cir. 2003) ("[c]onsumers in the market where trade is 

allegedly restrained are presumptively . . . proper plaintiffs to allege antitrust injury" who possess 

standing to sue (emphasis added)). But in this case, the homeowners have filed a proposed class 

action, and they seek to represent all similarly situated homeowners throughout the country – that 

is, all homeowners who have been forced to pay supracompetitive prices as a result of actions 

taken by HomeTeam to eliminate competition for the servicing of tube-in-the-wall pest control 

systems. To pursue a class action, the named plaintiff does not need to have suffered the very

same injury that the proposed class members have suffered. For example, a plaintiff who claims a 

defendant's product caused his cancer in California can seek to represent unnamed plaintiffs in 

New York who also got cancer from that product. If the named plaintiff's injury is "substantially 

similar" to the injuries suffered by the class members, the named plaintiff can represent them. See

generally Garrison v. Whole Foods Mkt. Grp., Inc., 2014 WL 2451290, at *4 (N.D. Cal. June 2, 

2014).

Perhaps the injuries (if any) suffered by homeowners in the other 35 geographic markets 

will turn out to be different from the injuries alleged by the Fresno and Bakersfield homeowners in 

this case. But assuming the truth of the allegations in the complaint, it's plausible that the named 

plaintiffs' injuries are substantially similar to the injuries incurred by the proposed class members. 

Although the SAC alleges 37 individual markets, and although the SAC hints at some potential 

differences among those markets, it alleges that throughout the country HomeTeam has, through 

improper tactics designed to achieve and retain a monopoly, largely or completely eliminated 

 

area. However, the homeowners' lawyers have made clear that this was an inadvertent omission, 

and the homeowners will not be penalized for this. The homeowners will be permitted to amend 

the operative complaint to cure this omission. For the sake of efficiency, this discussion assumes 

that the SAC actually alleges all 37 of the markets it intended to allege, because that will be the 

case once the homeowners' lawyers fix the mistake.

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United States District Court

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competitors in the relevant product market, thus forcing homeowners with tube-in-the-wall 

systems to pay supracompetitive prices to hire HomeTeam to service those systems. And at the 

pleading stage, this plausible allegation of substantial similarity is sufficient. Any further 

questions about potential differences among the injuries suffered by proposed class members must 

be adjudicated at the class certification stage, and does not present a standing problem. See 

Melendres v. Arpaio, 784 F.3d 1254, 1261-64 (9th Cir. 2015).

II.

HomeTeam concedes that the allegations supporting the homeowners' Sherman Act section 

2 claim are nearly identical to those at issue in the Killian action, and indeed, HomeTeam's only 

remaining argument in support of its motion to dismiss is an incorporation by reference of its 

argument that the Killian SAC failed to state a claim. 

The SAC in this case states a claim under section 2 for the same reasons that the SAC in 

the Killian action states a claim. This is discussed in more detail in the order granting in part and 

denying in part the motion to dismiss the SAC in Killian. But to summarize, the SAC plausibly 

alleges both a relevant product market (for service of tube-in-the-wall pest control systems) and 37 

individual geographic markets in which competition for service of tube-in-the-wall systems take 

place, which are pled in sufficiently concrete geographic terms. The SAC also plausibly alleges 

that HomeTeam possesses a monopoly in each of the 37 markets, and that it unlawfully 

maintained that monopoly through similar anticompetitive conduct in all of those markets, causing 

the plaintiffs and the putative class members – consumers of tube-in-the-wall pest control service 

– injury by forcing them to pay supracompetitive prices for that service. These allegations are 

sufficient to state a claim under Sherman Act section 2.

IT IS SO ORDERED.

Dated: December 21, 2015

______________________________________

 VINCE CHHABRIA

 United States District Judge

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