UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

________________ _________________ JOHNSON & JOHNSON VISION CARE, INC.; ALCON LABORATORIES, INC.; BAUSCH & LOMB INCORPORATED, Plaintiffs - Appellants,

v. SEAN D. REYES, in hi s official capacity as Attorney General of the State of Utah, Defendant - Appellee.

------------------------------ 1-800 CONTACTS, INC.; COSTCO WHOLESALE CORPORATION, Intervenors - Appellees.

------------------------------ LD VISION GROUP, Amicus Curiae. Nos. 15-4071, 15- 4072 & 15-4073 (D.C. Nos. 2:15-CV-00252-DB, 2:15-CV-00257-DB, 2:15-CV-00259-DB) (D. Utah)

________________ _________________ ORDER AND JUDGMENT *

________________ _________________ Before HOLMES , BACHARACH , and PHILLIPS , Circuit Judges.

________________ _________________

* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collate ral estoppel. It may be cited, however, for its persuasive value consiste nt with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. FILED United States Court of Appeals Tenth Circuit 

### December 19, 2016 Elisabeth A. Shumaker Clerk of Court2 In 2013, three of the nation’s four largest contact-lens manufacturers implemented uniform pricing policies (UPPs ) to set minimum retail prices for contact-lens sales in all fift y states. In 2015, Utah enac ted Utah Code Ann. § 58-16a905.1, which prohibited manufac turers from enforcing their UPPs against retailers in Utah. In effect, the statute freed retailers in Utah to sell c ontact lenses at prices lower than the prices manufacturers had set and mandated in their UPPs. In the district court, the manufacturers sought a preliminary injunction to stop Utah from applying section 58-16a-905.1. They argued that th is statute violates the Commerce Clause. We affirm the district court’s de nial of a preliminary injunction. BACKGROUND 1. The Anticompetitive Nature of the Contact-Lens Industry Because contact lenses are medical devices, consumers cannot buy them without a valid prescription from an eye-care professional. In the United States, four contact-lens manufacturers control 98.5% of the contact-lens market—Johnson & Johnson Vision Care, Inc.; Alcon Laboratorie s, Inc.; Bausch & Lomb Incorporated; and CooperVision Inc. The first three co mpanies listed (“Manufacturers”) are the plaintiffs in this case. None of the Manufac turers have offices in Utah or manufacture contact lenses there. The district court found that the contact -lens industry is anticompetitive, partly because eye-care professionals prescribe, and often sell, brand-specific contactlenses. It noted that “[i]n almost no other medical context does the prescriber of a medical device have the power to control bot h the brand the patient must use and also3 sell the particular medical device in the same breath.” R. vol. 4 at 759. Compounding this problem, in all states except now in Utah, contact-lens manufacturers by their UPPs set minimum retail sales prices for contact lenses. The UPPs stop retailers from selling contact lenses for less than th e UPPs’ minimum-require d (and artificially high) prices. Though not always so, cons umers now have a right to a copy of their contactlens prescription, enabling them to buy co ntact lenses from selle rs other than their prescribing eye-care professi onals. For instance, with th eir prescriptions, consumers may now buy their contact-lenses from othe r retailers, including eye-care retailers (such as LensCrafters), mass -merchandise retailers (such as Costco or Wal-Mart), and Internet retailers (such as 1-800-Contacts or Lens.com). Because of the industry’s anticompetitiv e leanings, contact-lens manufacturers have faced federal and state legislation ch allenging their anticomp etitive behavior, as well as antitrust lawsuits. Fo r example, in the 1990s, atto rneys general from 32 states and a national class of consumers sued Johnson & Johnson, Bausch & Lomb, and CIBA Vision Corporation, alle ging that those companies ha d conspired with eye-care professionals to restrain competition and to protect eye-care professionals from retail competition. See In re Disposable Contact Lens Litig. , Nos. 3:00-94 MD 1030, 2001 WL 203964, at *1 (M.D. Fla. Jan. 5, 2001); In re Disposable Contact Lens Antitrust Litig. , No. MDL 1030, 2001 WL 493244 (M.D. Fla. Feb. 1, 2001); In re Disposable Contact Lens Antitrust Litig. , 170 F.R.D. 524 (M.D. Fla. 1996). In 2001, the parties agreed to “broad injunctive relief requiring the [manufacturers] to sell contact lenses4 to non-ECP [eye-care profession al] retailers in a ‘commerc ially reasonable' and ‘nondiscriminatory’ manner for at leas t five years.” R. vol. 4 at 761. In 2003, Congress enacted the Fairness to Contact Lens Consumers Act, one provision of which re quired eye-care professionals to provide patients with their prescriptions. See 15 U.S.C. § 7601

. The Act aimed to increase retail competition by allowing consumers to buy contact lenses fro m retailers other than their prescribing eye-care professionals. Id. And in 2006, Utah enacted the Contact Lens Consumer Protection Act, which sought to continue the relief afford ed by the injunction issued in the In re Disposable Contac t Lens Antitrust Litigation cases. See Utah Code Ann. §§ 58-16a-901–902. To ensure that retailers selling contact lenses to Utah consumers would have an adequate range of supply, the Utah Act required manufacturers to certify that their brands of contact lens es sold in Utah were available in a commercially reasonable a nd nondiscriminatory manner to different distribution channels. These channels included Intern et retailers, mail order companies, department stores, and ma ss merchandise outlets. Id. §§ -902, -904(1). 2. Uniform Pricing Policies In 2013, the Manufacturers implem ented nationwide UPPs, which set minimum retail prices for their contact lenses. Under the UPPs, the Manufacturers reserved a right not to supply contact lenses to any retailer selling at prices below the UPP’s minimum prices. The Manufacturers claim that their UPPs result in lower prices for contact lenses. For instance, Johnson & Johnson claims that the UPPs save contact lens5 retailers and buyers the trouble of a complex rebate system. Under this rebate system, consumers received rebate forms upon pu rchase to complete and return for Manufacturer rebates. Johns on & Johnson contends that few consumers took the necessary steps to receive the available rebates. The Manufacturers also claim that UPPs improve patient care. For example, Johnson & Johnson argues that UPPs allow eye-care professionals to “devote more time to treating patients and less time to monitoring prices and rebates offered by retailers, and the consumer knows there is no need to shop around for a better bargain.” Johnson & Johnson Opening Br. at 4. And Alcon argues that UPPs benefit eye-care professionals by advising them “about the attributes of [the] products and of encouraging them, in turn, to inform patients of the product’s potential benefits.” Alcon Opening Br. at 10. The Manufacturers also tout the UPPs for “eliminat[ing] the need for discussions with eye doctors about other reta ilers’ prices. Consumers are assured that if their [eye-c are professional] or any othe r retailer is charging the minimum price, there is no n eed to shop around for a bett er bargain.” R. vol. 4 at 762. In contrast, Costco and 1-800-Contacts argue that UPPs serve to “insulate [eye-care professionals] fr om retail competition” and encourage eye-care professionals to prescribe a specific bra nd of contact lenses. Joint Br. of 1-800 Contacts, Inc. and Costco Wholesale Corpora tion at 7. They claim that UPPs restrict consumers’ options and increase prices. They also assert that U PPs benefit eye-care6 professionals by preventing others—including online retailers like 1-800-Contacts— from competing with lower prices. 3. Utah Code Ann. § 58-16a-905.1 In 2015, as mentioned, Utah passed a law preven ting Manufacturers from fixing retail contact-lens prices and from di scriminating against c ontact-lens retailers selling lenses below the UPPs’ minimum prices: A contact lens manufacturer or a c ontact lens distributor may not: (1) take any action, by agreement, un ilaterally, or otherwise, that has the effect of fixing or othe rwise controlling the pric e that a contact lens retailer charges or advertises for contact lenses; or (2) discriminate against a contact lens retailer based on whether the contact lens retailer: (a) sells or advertises contact lenses for a particular price; (b) operates in a particul ar channel of trade; (c) is a person authori zed by law to prescribe contact lenses; or (d) is associated with a person authorized by law to prescribe contact lenses. Utah Code Ann. § 58-16a-905.1. The Utah legislature also am ended section 58-16a906 to provide that “[t]he attorney gene ral may bring a civil action or seek an injunction and a civil pena lty” against anyone viola ting section 58-16a-905.1. Id. § 58-16a-906(2). 4. Present Lawsuit7 On April 13, 2015, about three weeks before sect ion 58-16a-905.1’s effective date, 1 Alcon filed this lawsuit seeking decl aratory and injunctive relief against the Utah Attorney General to stop him from enforcing secti on 58-16a-905.1. In support, it argued that the Utah statute violates the Commerce Clause. Alcon filed a preliminary-injunction motion the same day. The next day, Johnson & Johnson and Bausch & Lomb filed separate lawsuits . The district court consolidated the Manufacturers’ lawsuits. On April 17, 2015 , 1-800 Contacts and Costco intervened. After a hearing, the district court denied the Manufacturers’ re quest for preliminary injunction, concluding that they had faile d to meet any of the necessary showings discussed below. STANDARD OF REVIEW “On appeal, we review a district cour t’s decision to grant a preliminary injunction for abuse of discretion.” Fish v. Kobach , 840 F.3d 710 ( 10th Cir. 2016). “An abuse of discretion occurs where a decision is premised ‘on an erroneous conclusion of law or where there is no rati onal basis in the evid ence for the ruling.’” Id. (quoting Awad v. Ziriax , 670 F.3d 1111, 1125 (10th Ci r. 2012)). In measuring whether the district court abused its discreti on, we review the district court’s factual findings for clear error and its conclusions of law de novo. Id.

1 We see nothing in the record su ggesting that Utah has pursued any enforcement action against any of the Manuf acturers. On May 13, 2015, we issued a temporary injunction pending our resolution of this app eal. But on June 12, 2015, after receiving briefing from a ll parties on whether to gr ant an injunction pending appeal, we denied the Manufacturers’ mo tion for injunction pending appeal and vacated our temporary injunction. So Ut ah has enforced section 58-16a-905.1 from June 12, 2015 forward.8 DISCUSSION “[A] preliminary injunction is an extr aordinary and drastic remedy, one that should not be granted unless the movant, by a clear showing , carries the burden of persuasion.” Mazurek v. Armstrong , 520 U.S. 968, 97 2 (1997) (quoting 11A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 2948 (2d ed. 1995)). To obtain a preliminar y injunction, the Manufacturers needed to show “(1) a likelihood of success on the mer its; (2) a likelihood that th e moving party will suffer irreparable harm if the injunc tion is not granted; (3) the balance of equities is in the moving party’s favor; and (4) the preliminar y injunction is in the public interest.” Verlo v. Martinez , 820 F.3d 1113, 1126 (10th Cir. 2016) (quoting Republican Party of N.M. v. King, 741 F.3d 1089, 1092 (10th Cir. 2013)). The district court weighs these factors, and we limit our review to abuse of discretion. Gen. Motors Corp. v. Urban Gorilla, LLC , 500 F.3d 1222, 1226 (10th Cir. 2007). 1. Likelihood of Success on the Merits The Manufacturers argue th at section 58-16a-905.1 violates the Commerce Clause in three ways: (1) it impermi ssibly discriminates against out-of-state economic interests; (2) it imposes undue burd ens on interstate commerce; and (3) it causes impermissible extraterritorial effect s. We conclude that the district court didn’t abuse its discretion in determini ng that the Manufacturers are unlikely to succeed on any of these claims. We presume that sections 58-16 a-905.1–906 are constitutional. See Doe v. City of Albuquerque , 667 F.3d 1111, 1120 (10th Cir. 2012). And on top of this, we9 recognize that states may enact their ow n antitrust laws to supplement federal antitrust laws. “Congress intended the fede ral antitrust laws to supplement, not displace, state antitrust remedies.” California v. ARC America Corp. , 490 U.S. 93, 102 (1989). Generally, state laws that de ter anticompetitive cond uct are consistent with the broad purposes of federal antitrust laws. Id. Utah enacted section 58-16a905.1 with this salutary purpose—to de ter the Manufacturers’ anticompetitive conduct preventing price competition. Despite this, the Manufacturers claim th at section 58-16a-9 05.1 violates the Commerce Clause. The Commerce Clause grants Congress power to “regulate Commerce . . . among the several States.” U.S. Co nst. art. I, § 8, cl. 3. In addition to that express authority, the Co mmerce Clause also implicitly restrains state authority through the dormant Commerce Clause. 2 KT & G Corp. v. Atty. Gen. of Okla. , 535 F.3d 1114, 1143 (10th Cir. 2008). Whether a state violates the dormant Commerce Clause depends on whether its law improperly interferes with interstate commerce, primarily for economic protectionism. Direct Mktg. Ass’n v. Brohl , 814 F.3d 1129, 1135 (10th Cir. 2016), petition for cert. filed , (Sept. 1, 2016) (No. 16-267). A state statute may violate the dormant Commerce Clause in three ways: First, a statute that clearly discrimi nates against inters tate commerce in favor of intrastate commer ce is virtually invalid per se and can survive only if the discriminati on is demonstrably jus tified by a valid factor

2 For many years, the Supreme Court has read the Commerce Clause to include the “dormant” or “negative” Commerce Clause. Energy and Env’t Legal Inst. v. Epel , 793 F.3d 1169, 1171 (10th Ci r. 2015). Using this clause, courts have stricken state laws that unduly interfere with interstate commerce. Id.10 unrelated to economic protectionism. Second, if the statute does not discriminate against interstate commerce, it will nevertheless be invalidated under the Pike v. Bruce Church Inc. , 397 U.S. 137, 142 . . . (1970), balancing test if it imposes a burden on interstate commerce incommensurate with the local benefits secured. Third, a statute will be invalid per se if it has the practical effect of extraterritorial control of commerce occurring entirely outside the boundaries of the state in question. KT & G Corp. , 535 F.3d at 1143 (quoting Grand River Enters. Six Nations, Ltd. v. Pryor , 425 F.3d 158, 168 (2d Ci r. 2005)). We focus our an alysis on these recognized dormant Commerce Clause viola tions. And we conclude that the district court didn’t abuse its discretion by holding that the Ma nufacturers failed to show that they are likely to succeed on the merits of th eir dormant Commer ce Clause claims. 3 A. The district court properl y exercised its discretion in concluding that section 58-16 a-905.1 doesn’t discriminate against interstate commerce. “State laws discriminating against in terstate commerce on their face are virtually per se invalid.” Camps Newfound/Owatonna, In c. v. Town of Harrison , 520 U.S. 564, 575 (1997) (inter nal quotations omitted). A nd discrimination “simply means differential treatment of in-state and out-of-state economic in terests that benefits the former a nd burdens the latter.” KT & G Corp. , 535 F.3d at 1143 (quoting United Haulers Ass’n, Inc. v. Onei da-Herkimer Solid Waste Mgmt. Auth. , 550 U.S. 330, 338 (2007)). We look to see whether the state statute “dis criminat[es] between transactions on the basis of some intersta te element.” Comptroller v. Wynne , 135 S.

3 We limit our review to the preliminar y-injunction standard and recognize that Manufacturers will have an opportunity to show a dormant Commerce Clause violation in further district-court proceedings.11 Ct. 1787, 1794 (2015) (quoting Bos. Stock Exch. v. State Tax Comm’n , 429 U.S. 318, 332 n.12 (1977)). “The party claiming discrimination must s how that the state law benefits local actors and burdens out-of-sta te actors, and the result must alter the competitive balance between in-state and out-of-state firms.” Direct Mktg. Ass’n , 814 F.3d at 1142 (internal quotations and alteration omitted). Supreme Court cases reveal how states can impermissibly disc riminate against interstate commerce. For instance, in Oregon Waste System, Inc. v. De partment of Environmental Quality , 511 U.S. 93, 96, 99–100 (1994), the Supreme Court conclude d that a state statute discriminated against interstate commerce by imposing a higher surcharge on disposal of solidwaste “generated out-of-state” than the surcharge for solid waste generated in-state. And in Hughes v. Oklahoma , 441 U.S. 322, 336–37 (1979), the Supreme Court concluded that a state statut e forbidding the transportation of minnows outside of the state for sale discriminated ag ainst interstate commerce. In Wyoming v. Oklahoma , 502 U.S. 437, 455 (1992), the Supreme C ourt struck down an Oklahoma statute that reserved a segment of the Oklahoma coal market for Ok lahoma-mined coal, to the exclusion of coal mined in other states. Similarly, in West Lynn Creamery, Inc. v. Healy , 512 U.S. 186, 193 (1994), the Suprem e Court explained that a “paradigmatic example of a law discriminating against interstate commerce is the protective tariff or customs duty, which taxes goods imported fro m other States, but does not tax similar products produced in State.” Finally, in Healy v. Beer Institute, Inc., 491 U.S. 324, 341 (1989), the Supreme Court concluded th at a Connecticut statute discriminated12 against interstate commerce by treating Co nnecticut and out-of-s tate beer producers differently. In particular, the statute allo wed Connecticut wholesalers not selling in states other than Connecticut to charge an y price in Connecticut , while limiting beer producers selling beer outside Connecticut to the price they charged in those other

states. Id. In each of these cases, th e state laws imposed rest rictions or burdens on out-of-state or interstate parties to benefit in-state interests. Here, the Utah statute is easily disti nguishable from those offending statutes at issue in the cited cases. The Manufacturers claim that section 58- 16a-905.1 violates the dormant Commerce Clause by discrimi nating against inters tate commerce in favor of retailers in Utah. In support, th ey contend that sec tion 58-16a-905.1 favors retailers in Utah over out-of-state manuf acturers by taking away pricing authority from the out-of-state manufactur ers and giving it to retailers in Utah. And they claim that section 58-16a-905.1 “impermissibly confers on Utah re tailers a special exemption from manufacturers’ pricing po licies that no other retailers enjoy.” Johnson & Johnson Opening Br. at 30. But the Manufacturers cannot identify how section 58-16a-905.1 places burdens on contact-lens sales not involving retailers in Utah. Unlike the statutes in the above-cited cases, section 58-16a-905.1 doesn’t require out-of-state retailers to charge more for contact lenses than retailers charge in Utah. Nor does it burden out -of-state retailers. And the Manufacturers certainly haven’t contended that secti on 58-16a-905.1 diminishes th e total interstate sales by Manufacturers. The Manufacturers don’t identif y any way that section 58-16a-905.113 treats in-state retailers diffe rently from out-of-state retail ers or would treat in-state manufacturers differently from out-of-state manufacturers. And finally, section 58- 16a-905.1 doesn’t favor retailers in Utah over interstate retailers. See Exxon Corp. v. Governor of Maryland , 437 U.S. 117, 125 (1978) (rejecting Commerce Clause challenge when all dealers were treated the same). Instead, section 58-16a-905.1 treats all retailers in Utah the same, regardless of whether the retailers al so sell in other states. In determining whether a statute discri minates against inte rstate commerce in favor of intrastate commerce, “[i]t is not necessary to look beyo nd the text of [the] statute . . . .” Camps Newfound/Owatonna, Inc. , 520 U.S. at 575. Here, we agree with the district court that section 58-16a-905. 1 solely governs the prices contact-lens retailers selling in Utah can charge. The district court di dn’t err in relying on the Utah Attorney General’s interpretation of sections 58-16a-9 05.1 or 58-16a-906— saying that the statutes don’t apply to th e conduct of manufacturers or retailers selling outside Utah. If retailers or ey e-care professionals se lling contact lenses outside of Utah can’t compet e with the lower price availa ble from retailers in Utah, that’s not Utah’s fault. Sect ion 58-16a-905.1 doesn’t require retailers in other states to sell at higher prices—it doesn’t address re tailers in other states at all. Nor does the Utah statute somehow restrict other stat es from following its lead. The Commerce Clause gives neither the Manufacturers nor retailers selling cont act lenses outside Utah grounds to repeal Utah’s law governing business in Utah.14 Alcon also argues that section 58-16a-90 5.1 necessarily discriminates against out-of-state manufacturers because all manuf acturers are located outside of Utah. In Exxon Corp , 437 U.S. 117, the Supreme Court reject ed a similar argument. There, the Court addressed a Commerce Clause cha llenge concerning a Maryland statute prohibiting producers or refiners of pe troleum from operating any retail service stations in Maryland. Id. at 120–21. All petroleum producers and refiners were located outside of Maryland so the statut e affected only out-of-s tate producers and refiners. Id. at 125. In rejecting the producers and refiners’ arguments, the Court explained that the statute “creates no barri ers . . . against inte rstate independent dealers; it does not prohib it the flow of interstate goods, place added costs upon them, or distinguish between in-state a nd out-of-state comp anies in the retail market.” Id. at 126. The Court observed that “[s]ince Maryland’s entire gasoline supply flows in interstate commerce and since there are no local producers or refiners, such claims of di sparate treatment between in terstate and local commerce would be meritless.” Id. at 125. Here, similar to the situ ation with the petroleum producers and refiners in Exxon , all the contact-lens manufacturers are lo cated outside of Utah. Thus, section 58-16a-905.1 cannot favor manufacturers in Utah over out-of-state manufacturers. Instead, “since ther e are no local [manufactu rers], such claims of disparate treatment . . . would be meritless.” Id. For these reasons, the distri ct court didn’t abuse its discretion in concluding that the Manufact urers were unlikely to succeed on the merits of their claim alleging discri mination against interstate commerce.15 B. The district court properl y exercised its discretion in concluding that section 58-16a -905.1 doesn’t impose an undue burden on interstate commerce. “Whether a state law undul y burdens interstate commer ce is a separate inquiry from whether a state law discrimina tes against interstate commerce.” Direct Mktg. Ass’n , 814 F.3d at 1145. “A state law that doe s not discriminate against interstate commerce may still be invalidated under the dormant Commerce Clause if it puts a burden on interstate commerce that is ‘clear ly excessive in rela tion to the putative local benefits.’” Quik Payday, Inc. v. Stork , 549 F.3d 1302, 1309 (10th Cir. 2008) (quoting Pike v. Bruce Church, Inc. , 397 U.S. 137, 142 (1970)). In determining whether the burden is clearly excessive in relation to the putative local benefits, we apply the Pike balancing test. Kleinsmith v. Shurtleff , 571 F.3d 1033, 1040 (10th Cir. 2009). The Pike balancing test requires us to consider four factors: (1) the nature of the putative local bene fits advanced by the [statute]; (2) the burden the [statute] imposes on in terstate commerce; (3) whether the burden is “clearly excessive in rela tion to” the local benefits; and (4) whether the local interests can be pr omoted as well with a lesser impact on interstate commerce. Blue Circle Cement, Inc. v. Bd. of Cty. Comm’rs of Rogers , 27 F.3d 1499, 1512 (10th Cir. 1994) (quoting Pike , 391 U.S. at 142). The Manufacturers bear the burden of establishing that secti on 58-16a-905.1 fails the Pike balancing test. See Kleinsmith , 571 F.3d at 1043 (“The person challengi ng the statute bears the burden of establishing a Pike violation.”). In reviewing the dist rict court’s analysis, we review the district court’s factua l findings for clear error. Fish , 840 F.3d 710.16 Here, the district court identifies two pu tative local benefits of section 58-16a905.1: (1) it returns intrabrand competition to the contact-lens market in Utah; and (2) it allows retailers in Ut ah to charge lower prices to consumers buying contactlenses in Utah. The district court concluded that the Ma nufacturers’ burden to comply with section 58-16a-905.1 was in line w ith the burden imposed by other state antitrust laws. Balancing the Pike factors, the district court concluded that the Manufacturers were unlikely to succeed on the merits of their claims. The Manufacturers clai m that section 58-16a-90 5.1 burdens interstate commerce by “interfer[ing] with the manufactur ers’ pricing policies as they apply to retail sales . . . in all 50 stat es.” Alcon Opening Br. at 47. “Although evidence regarding a particular company may be su ggestive, the benefit- to-burden calculation is based on the overall benefits and burden s that the statutory provision may create, not on the benefits and burdens with respect to a partic ular company or transaction.” Quik Payday, Inc. , 549 F.3d at 1309. So we focus our analysis on the overall putative local benefits and the burdens on interstate commerce, ra ther than the Manufacturers’ specific burdens. The record supports the district cour t’s factual findings concerning the local benefits and burdens of sect ion 58-16a-905.1. Thus, we see no clear error. And we agree with the district court that the Ma nufacturers haven’t s hown that any burden clearly exceeded the local benefits. Again, in Exxon , the Supreme Court addressed similar arguments that the Maryland la w burdened interstate companies by17 disallowing interstate producers and refi ners from operating se rvice stations in Maryland. 437 U.S. at 127. The Supreme Court rejected this argument in these terms: Some refiners may choose to wit hdraw entirely from the Maryland market, but there is no reason to assu me that their share of the entire supply will not be promptly replaced by other interstate refiners. The source of the consumers’ supply may switch from company-operated stations to independent dealers, but interstate commerce is not subjected to an impermissible burden simp ly because an otherwise valid regulation causes some business to sh ift from one interstate supplier to another. Id. The same analysis applies in our cas e. The Manufacturers have presented no evidence that section 58-16a-905.1 will redu ce the nationwide total sales of contact lenses. In fact, a basic law of economics te lls us that increased sales follow lower prices. So following the Supreme Court’s reasoning in Exxon , we conclude that section 58-16a-905.1 doesn’t impose an undue burden on interstate commerce. C. The district court didn’t err in concluding that section 58- 16a-905.1 will have no impermi ssible extraterritorial effects. “[T]he ‘Commerce Clause . . . precludes the application of a state statute to commerce that takes place wholly outside of the State’s borders, whether or not the commerce has effects within the State.’” Healy , 491 U.S. at 336 (quoting Edgar v. MITE Corp. , 457 U.S. 624, 642–43 (1982)). Under this rule, “a State may not adopt legislation that has the practical effect of establishing ‘a scale of prices for use in other states.’” 4 Id. (quoting Baldwin v. G.A.F. Seelig , Inc. , 294 U.S. 511, 528 (1935)).

4 In Healy , Connecticut learned that beer pr ices were consistently lower in three bordering states than in Connecticut. Id. at 326. This led to Connecticut residents frequently crossing st ate lines to purchase beer. Id. To eliminate the price difference, Connecticut enacted a statute requiring out-of-state beer shippers to18 The district court concluded that sec tion 58-16a-905.1 has no extraterritorial application, that is, it wi ll not apply to sales occu rring outside of Utah. The Manufacturers claim that section 58-16a- 905.1 has impermissible extraterritorial effects because all of the manufacturers are located outside of Utah, and because it regulates sales of contact lenses to consumers outside of Utah. 5 Utah’s section 58-16a-905.1 doesn’t require other stat es to do anything. They can choose whether to pass similar statutes . Section 58-16a-905.1 reaches no further than contact-lens sales in Utah. When interpreting section 58-16a-905.1, we are guided by the rule of c onstitutional avoidance. Doe , 667 F.3d at 1120. The district court correctly pointed out that “[u]nder a deeply rooted and longstanding canon of construction, statutes are pres umed not to have extraterrito rial effect . . . . [U]nless a statute gives a ‘clear indication of an extr aterritorial application, it has none.’” R. vol. 4 at 766–67 (quoting Nevares v. M.L.S. , 345 P.3d 719, 727 (Utah 2015)). Here,

affirm that their posted prices for produc ts sold to Connecticut wholesale were no higher than the prices sold in the bordering states. Id . The Supreme Court concluded that “the Connecticut statute has the unde niable effect of controlling commercial activity occurring wholly outside the boun dary of the State” because once a beer shipper sets its price in Connecticut, it cannot change its price in another neighboring state. Id. at 337. So in effect, the statute controlled prices in Massachusetts. See id. at 326–27. Here, the Manufacturers don’t argue that section 58-16a-905.1 controls prices in other states, nor could they. The Manufacturers ar e free to charge whatever price they choose in other states w ithout violating se ction 58-16a-905.1.

5 The Manufacturers also argue that se ction 58-16a-905.1 violates the dormant Commerce Clause because it di rectly regulates interstate commerce. But we have recognized that absent a “regulation . . . blatantly regulating pr ice and discriminating against out-of-state cons umers or producers, Baldwin ’s near per se rule doesn’t apply.” Energy and Env’t Legal Inst. , 793 F.3d at 1173–74.19 nothing in section 58-16a-905.1 provides fo r extraterritorial application. So we interpret this statute as though it doesn’t apply to retail sales made outside of Utah. As the district court concluded, re lying on the Utah Attorney General’s interpretation, neither section 58-16a-9 05.1 nor 58-16a-906 regulate the price retailers charge for contact lenses outside of Utah. 6 Retailers outside of Utah are free to sell contact lenses for whatever price th ey would like, including the prices set by the Manufacturers’ UPPs. The Manufacturers also claim that sect ion 58-16a-905.1 has extraterritorial effects because it “bars an out-of-state contact lens manufacturer from setting a minimum resale price for the sale of its prod ucts by a Utah contact lens retailer to a customer in California.” Alcon Opening Br . at 30. But the Manufacturers’ argument ignores Utah’s interest. Sp ecifically, the Manufacturers ignore the location of the retailer—Utah. Based on their own analys is, section 58-16a-905 .1 doesn’t regulate conduct occurring wholly outside of Utah —it only regulates sales from a Utah retailer that is lo cated within Utah. 7

6 For example, section 58-16a-905.1 do esn’t regulate sales by Colorado retailers that occu r in Colorado.

7 Under Utah Code Ann. § 70A-2-401(2)(a ), title of the go ods passes to the buyer at the time and place of the shipment. So if an out-of-state consumer purchases from retailers in Utah, we conclude that Utah possesses a suffi cient interest to regulate the sale from retailers in Utah. See Okla. Tax Comm’n v. Jefferson Lines, Inc. , 514 U.S. 175, 184 (1995) (bus-ticket sale from Oklahoma to another state has sufficient nexus to Oklahoma under dormant Commerce Clause). This remains so even though the contact lenses are sent to consumers outside of Utah.20 We recently explained that to strike dow n a statute based on its extraterritorial application, a challenger must establish that the statute has three characteristics: “(1) a price control or price affirmation regula tion, (2) linking in-state prices to those charged elsewhere, with (3) the effect of raising costs for out-of-state consumers or rival businesses.” Energy and Env’t Legal Inst. , 793 F.3d at 1173. Here, section 58-16a-905.1 doesn’t have these three characteristics. First, unlike the laws involved in several Suprem e Court cases on this point, section 58- 16a-905.1 isn’t a price contro l or price affirmation regula tion. As examples of cases involving these disallowed re gulations, we first point to Baldwin , where New York prohibited out-of-state companie s from selling milk in the state unless they purchased their milk at the same price paid to New York dairy farmer s. 294 U.S. at 519. And in Brown-Forman Distillers Corp. , New York law required liquor merchants to list their prices monthly and to affirm that their New York prices were no higher than those charged in other states. 476 U.S. at 576. In both of these cases, the Supreme Court concluded that the state laws required price affirmation. By contrast, Utah’s section 58-16a-905.1 requires no price a ffirmation. In fact, the st atute doesn’t even control the price of contact lenses sold in Utah . Nothing in section 58-16a-905.1 prevents Manufacturers from selling contact lenses to retailers at wh atever price they choose, so long as they don’t discri minate against retailers for selling at prices below those set by the Manufacturers. So we agree with the district court that the Manufacturers likely cannot establish that the Utah statut e is a price control or price affirmation regulation.21 Nor does section 58-16a-905.1 link retail prices charged in Utah to prices charged elsewhere. In contrast to Baldwin and Brown-Forman Distillers Corp. , where the statutes linked the local prices of goods to prices listed in other states, section 58- 16a-905.1 contains no such provision. Again, the Manuf acturers and all retailers outside of Utah can sell contact lenses at whatever price they choose. And finally, section 58-16a-905.1 doesn’t raise contact -lens prices for consumers buying contact lenses from retailers outside Utah. None of the Manufactur ers argue otherwise. Thus, we conclude that the district court properly exercised its di scretion in concluding that section 58-16a-905.1 doesn’t have imperm issible extraterritorial effects. Because we conclude that the district court didn’t abuse its discretion in concluding that the Manufacturers are unlik ely to succeed on the merits of their claims, it is unnecessary to address the remaining factors of the preliminary injunction standard. See Winter v. Nat. Res. Def. Council, Inc. , 555 U.S. 7, 23–24 (2008); Sierra Club, Inc. v. Bostick , 539 F. App’x 885, 888 (10th Cir. 2013) (“A party seeking a preliminary injunction must prove that all four of the equitable factors weigh in its favor.”). CONCLUSION The district court’s decision denyi ng the Manufacturers’ motions for preliminary injunction is affirmed. Because th e record before us is limited, we note22 specifically that we express no opinion on the ultimate merits of this case.

Entered for the Court
Gregory A. Phillips Circuit JudgeJohnson & Johnson Visi on Care v. Reyes, No s. 15-4071, 15-4072, 15-4073 BACHARACH , J., dissenting on Part 1(A). I respectfully dissent on Part 1(A), where the majority concludes that the manufacturers are unlike ly to prevail on their discrimination claim. The threshold procedural question is whether we can entertain the contact-lens manufacturers’ as-applied challenge before Utah has enforced the statute. I believe that we can. The subsequent question is whethe r the Utah statut e violates the dormant commerce clause by discrimina ting against retailers outside of Utah. In my view, the Utah statute does so. Because of the discrimination against out-of-state reta ilers, we can uphold the Ut ah statute only if it survives stri ct scrutiny. The district court failed to apply strict scrutiny based on a belief that the statute did not di scriminate against out-of-sta te retailers. In my view, this belief was mistaken; as a result, I would reverse a nd remand for the district court to apply strict scruti ny when analyzing likelihood of success on the discrimi nation claim. I. The Procedural Validity of the Manufacturers’ As-Applied Challenge Utah questions whether we can consider an injunction because the claim involves application of a statute before it has been enforced. I would hold that the manufactur ers can bring an as-app lied challenge prior to enforcement.2 Relying on United States v. Gaudreau , 860 F.2d 357 (10th Cir. 1988), Utah argues that the manufacturers coul d not bring this challenge until the statut e is enforced. See Gaudreau , 860 F.2d at 360-61 (“In a declaratory judgment acti on no one has be en charged so the court cannot evaluate the statute as app lied.”). But after we decided Gaudreau , the Supreme Court has entertained multiple as-applied cha llenges prior to enforcement. See Gonzales v. Carhart , 550 U.S. 124, 167 (2007) (abortion); Wis. Right to Life, Inc. v. Fed. Election Comm’n , 546 U.S. 410, 411-41 (2006) (per curiam ) (First Amendment); see also Fed. Election Comm’n v. Wis. Right to Life, Inc. , 551 U.S. 449, 481 (2007) (“[W]e hold that BCRA § 203 is unconstitutional as applied to WRTL’s ‘Wedding,’ ‘Loan,’ and ‘Wa iting’ ads.”); Citizens United v. Fed. Election Comm’n , 558 U.S. 310, 331 (2010) (implicitly approving of as-applied, preenforcement challenges ). Under these post- Gaudreau decisions, the manufacturers can bring an as-applied ch allenge to the Utah statute prior to enforcement. II. The Practical Effect of the Statute on Retailers Selling Contact Lenses The district court denied a prelim inary injunction based largely on a prediction that the manufacturers could not prove their clai ms at trial. At oral argument, Utah c onceded that we engage in de novo review on likelihood of succe ss. I agree with this conces sion in determining whether3 the district court correct ly applied the law on th e manufacturers’ claim of discrimination against ou t-of-state retailers. 1 On this claim, I believe that the district court erred. A. How We Gauge Discrimination The threshold issue involves how we gauge discrimination: Do we restrict ourselves to the text of the Utah stat ute, or do we go beyond the statutory text to consider the stat ute’s practical effect? The majority concludes that we should confine ourselves to the te xt of the statute. Maj. Op. at 13. I resp ectfully disagree. The Supreme Court has di rected us to determin e whether the statute “discriminates against inte rstate commerce either on its face or in practical effect.” Hughes v. Oklahoma , 441 U.S. 322, 336 ( 1979). Even neutrally worded statutes may viol ate the dormant commerce cl ause when the effect is discriminatory. Hunt v. Wash. Apple Advert. Comm’n , 432 U.S. 333, 352-53 (1977); see also C&A Carbone, Inc. v. Town of Clarkstown , 511 U.S. 383, 394-95 (1994) ( holding that a neutra lly worded ordinance violated the dormant commerce cl ause because the effect was discriminatory).

1 Generally, the abuse-of-discreti on standard applies on likelihood of success. Verlo v. Martinez , 820 F.3d 1113, 1128 (10th Cir. 2016). But even when the overarching standa rd is abuse of discretion, we engage in de novo review on matters of law. Fish v. Kobach , 840 F.3d 710, 723 (10th Cir. 2016). A matter of law aris es on the validity of the manufacturers’ claim under the dormant commerce clause. See Jones v. Gale , 470 F.3d 1261, 1267 (8th Cir. 2006).4 The majority confines its inquiry to the statutory text based on Camps Newfound/Owat onna, Inc. v. To wn of Harrison , 520 U.S. 564 (1997). There, the Suprem e Court held that the statutory text facially discriminated against interstate comm erce. 520 U.S. at 575-76. Thus, the Court said that it was unnecessary to go beyond the st atutory text. Id. In my view, this is true only when the statutory text expressly discriminates against interstate comm erce. When the stat ute is neutrally worded, however, the Supreme Court requi res us to go further, examining the statute’s pr actical effect. Maine v. Taylor , 477 U.S. 131, 138 (1986); see also Kleinsmith v. Shurtleff , 571 F.3d 1033, 1040 (10th Cir. 2009) (stating that the claima nt can prevail under the dormant comme rce clause by showing that a facially neutral state statute “dis criminates in practical effect”). I would follow this requirement. Like the majority, I regard the statute as neutrally worded. As a re sult, I would consider the statute’s practical effect. B. The Utah Attorney General’s Interpretation of the Statute The Utah attorney genera l interprets the statute to apply only to Utah retailers. This interpre tation is not binding, 2 but it does provide persuasive

2 See Stenberg v. Carhart , 530 U.S. 914, 917 ( 2000) (“[T]he Court’s precedent warns against acce pting as ‘authoritative’ an Attorney General’s interpretation of stat e law where, as here, that interpretation does not bind the state courts or lo cal law enforcement.”).5 evidence on how the statute will be applied. See Grayned v. City of Rockford , 408 U.S. 104, 110 (1972) (interpret ing a statute based, in part, on the “interpretation of the statute given by those charged with enforcing it”). Under this interpretation, the manu facturers could not enforce their minimum-pricing policies against Utah contact-lens reta ilers but could enforce the policies against re tailers in every other state. C. The Price Advantage Created by the Statute for Utah Retailers This interpretation treats similarl y situated retailers differently. A retailer in Utah could freely price contact lenses wi thout constraints imposed by any manu facturer. Retailers in the 49 other states could obtain this pricing protection only by re locating to Utah. Unless non-Utah retailers relocate to Ut ah, they would lack any power to match a Utah retailer’s prices anyw here in the country. 3

3 The plaintiffs are ma nufacturers, not retailers . Thus, a potential issue exists regarding the manufacturers’ prud ential standing to assert the rights of retailers. Prudentially, we generally require plain tiffs to assert their own rights rather than those of third parties. Warth v. Seldin , 422 U.S. 490, 499 (1975). But this requirement is prudential, not jurisdictional. Phillips Petroleum Co. v. Shutts , 472 U.S. 797, 804 (1985). As a result, we can decline to consider prudential standing issues wh en they are no t raised by the parties. See Grubbs v. Bailes , 445 F.3d 1275, 1281 (10th Cir. 2006) (“Questions relating to prudential standing . . . may be pretermitted in favor of a straightforward di sposition on the merits.”). In this appeal, no one has questioned the ma nufacturers’ prudential standing to assert the righ ts of out-of-state retail ers. In the absence of adversarial briefing, I would declin e to address the potential issue on prudential standing. See Finstuen v. Crutcher , 496 F.3d 1139, 1147 (10th6 Suppose the four out-o f-state manufacturers offer a contact lens to retailers for $5. 00 to $10.00.

Now, the retailers will wa nt to resell the contac t lenses to consumers throughout the country. Utah has one retaile r, 1-800 CONTACTS. 4 Under the Utah law, 1-800 CONTAC TS can resell the contact lenses to consumers around the country at any price. But all of 1-800 CONTACTS’s competitors are outsid e Utah, so they will be subject to the manufacturers’ price floors. Cir. 2007) (stating that we could decline to address a ne wly submitted argument involving pr udential standing).

4 Costco also sh ips from Utah, suggesting that it may also be able to use the Utah statute to undersell all retailers outside of Utah.7 For illustration, let’s assume that the price floor is $25.00. 1-800 CONTACTS could offer the contact lenses at $15.00, underselling all of its out-of-state competitors, who would have to price the contact lenses at $25.00 or more.

The Supreme Court squarely invalidated this sort of discrimination in Granholm v. Heald , 544 U.S. 460 (2005). That case involved differences in the treatment of wineries in New York and Michigan. Granholm , 544 U.S.8 at 467, 476. In both states, the distri bution of alcoholi c beverages followed a three-tier system, requiring separate licenses for production, wholesale, and retail. Id. at 466. But both states enacte d regulations that permitted instate wineries to bypa ss this system, allowing them to ship products directly to in-state consumers. Out- of-state wineries could not obtain the same benefit. Id. at 469-71. This practice vi olated the dormant commerce clause: The regulations lowe red the price of in-state wine relative to outof-state wine, resulting in discrimina tion. Out-of-state wineries could obtain equal treatment only by relocating to New York or Michigan. Id. at 473-76, 487-88. As a re sult, the Court held that the regulations discriminated against ou t-of-state retailers. Id. at 487-88, 493. The same is true here. Under the Utah statute, contact-lens retailers would enjoy price protection inside Utah but not inside a ny of the other 49 states. This potential exists part ly because Utah hosts a retailer, 1-800 CONTACTS, which se lls roughly 99% of its contact lenses outside of Utah. The Utah statute allows 1-800 CONTACTS to always undersell retailers outside of Utah when competing for sale s in 49 states. In my view, the Supreme Court outlawed this sort of discrimination in Granholm

. The intervenors ignore this discri mination, focusing instead on the equality enjoyed by manufacturers bo th inside and outs ide Utah. I agree with the intervenors that manufactur ers are treated equally, but retailers are not. The Utah statute enables a Utah retailer to enjoy price protections9 that are not enjoyed by re tailers in other states (even when competing for sales outside Utah). D. Violation of the Dormant Commerce Clause by Combining an Industry’s Organization with the Effect of a State Statute Utah acknowledges the difference in treatment of retailers but attributes the ill effects to the manufact urers’ pricing polic ies, rather than the state statute. In rea lity, however, the discrimina tory effects are created by a combination of three factors: 1. The Utah statute protects Utah retailers from manufacturers’ policies setting minimum prices. 2. The manufacturers have established minimum-pricing programs for all retailers nationwide. 3. Utah retailers can now undersell retailers in ev ery state when competing for sales in 49 states. Considered alone, the manufacturers’ pricing po licies would treat all retailers in the same way. But Utah retailers gain a competitive edge from a combination of the Utah statute and the manufactur ers’ pricing policies. Utah and the intervenors argue that retailers outsi de Utah will be hurt only because of the manufacturers’ pricing policies. As Utah and the intervenors contend, the manufacturer s can relieve non-Utah retailers of their selling disadvantage by repealing the pricing policies. But in virtually any case, businesses can avoid discrimi natory statutes by modifying their policies. That opport unity does not nega te the discriminato ry nature of the

state statute.10 The Supreme Court addressed analogous issues involving

 the labeling of superior grade apples in Hunt v. Washington State Apple Advertising Commission , 432 U.S. 333 (1977);

 the packaging and sh ipment of high-qua lity cantaloupes in Pike v. Bruce Church, Inc. , 397 U.S. 137 (1970);

 the regulation of the shrimp industry in Toomer v. Witsell , 334 U.S. 385 (1948), and Foster-Fountain Packing Co. v. Haydel , 278 U.S. 1 (1928); and

 the establishment of a federa l agency’s minimum-pricing scheme in West Lynn Creamery , Inc. v. Healy , 512 U.S. 186 (1994). In Hunt , North Carolina adopted a regulation that had prohibited labeling of apples with anything other than a grade adopt ed by the United States Department of Agriculture. This regulation affected a program in the State of Washington that required st ringent inspec tions. 432 U.S. at 336. North Carolina created a “leveling effect,” which the Supreme Court found had discriminated against interstate commerce: Out-of-state apple growers had to change their marketing strategi es to comply with a North Carolina statute on labeling. Id. at 351-52. The Court noted that “the increased costs imposed by the statute w ould tend to shield the lo cal apple industry from the competition of [out-o f-state] apple growers.” Id. at 351. Of course, Washington apple growers could avoi d the cost increases by modifying their marketing strategies. But the apple growers didn’t have to. The Supreme Court struck down the regulation because the out-of-state11 apple growers would experi ence discriminatory pr ice increases if they continued their existin g marketing practices. Here, out-of-state retailers will be unable to matc h Utah retailers’ prices unless the out-of-state retailers modify their existing marketing practices. Washington appl e growers didn’t have to modify their marketing practices in Hunt , and out-of-state contact-le ns manufacturer s should not have to do so in our case. The Supreme Court also addre ssed similar circ umstances in Pike

. There, Arizona enacted a statute that required all cant aloupes grown in Arizona to be packaged and shipped in a standard format. 397 U.S. at 138. Under authority granted by the statute, an Arizona state of ficial issued an order prohibiting a farmer from transporting its Arizona-grown cantaloupes—which were co nsidered “highe r quality” than other Arizonan cantaloupes—to California fo r packing and processing. Id. at 138-39. To comply with the order, the farmer would have had to build packing facilities in Arizona. Id. at 140. The Supreme Court invalidated the order as violating the dormant commerce clau se, in part because the order had imposed a “straitjacket” on farmers wi th respect to the allocation of their interstate resources. Id. at 146. In itself, the Arizona order woul d not have violated the dormant commerce clause. Bu t the Supreme Court considered the impact of the order based on how farmers structured their businesses. The farmers didn’t12 have to restructur e their businesses in the face of the Arizona order, and the contact-lens manufacturers shou ld not have to restructure their businesses in the face of Utah’s statute. The circumstances were also similar in Foster-Founta in Packing and Toomer , where the Supreme Court struck down state laws that interfered with the interstate shrimp industry. In Foster-Fountain Packing , a Louisiana law proh ibited interstate shipment of shrimp when “the head s and hulls [had] not been removed.” 278 U.S. at 8. This law proved discriminatory only because of the way that the shrimp industry wa s structured: Shrimp we re caught in Louisiana waters and processed and canned for interstate shipment in Mississippi. But virtually all shrimp that left Louisiana had their “heads and hulls” intact. Id. at 9-10. Thus, the statute eff ectively eliminated the shrimp supply for the Mississipp i canners. As a result, the Supreme Court struck down the statute under the dormant commerce clause. Id. at 13. And in Toomer , a South Carolina statute re quired shrimp boaters to unload, pack, and ship all shrimp ca ught in South Carolina waters at a South Carolina port . 334 U.S. at 390-91. Noneth eless, Georgia fishermen would suffer prohibitive costs becaus e they maintained their own docking and packing faciliti es in Georgia. Id. at 403-04. Thus, the Supreme Court struck down the statute. Id. at 406.13 The Supreme Court did not force the Mississipp i shrimp canners in Foster-Founta in Packing to move to Louisiana, just as the Court did not force the Georgia fisherme n to acquire South Caroli na docking facilities in Toomer . Similarly, the contact-lens manu facturers should not have to adjust their policies to av oid the discriminatory eff ect of the Utah statute. The Supreme Court also applied this approach to a minimum-pricing program in West Lynn Creamery . There, Massachusetts imposed a pricing order that had the net effect of making milk produced in other states more expensive than milk pr oduced in Massachusetts. 512 U.S. at 194-95, 195 n.10. Producers in other states were handicapped by the pricing order and the minimum prices impose d by a federal agency. Id. at 188-89, 194-95. The Supreme Court regarded the Massachusetts scheme as discriminatory even though the dealer s’ dilemma stemmed fr om a minimum-pricing scheme enacted by a federal agency. Id. at 194-95. The Court explained: “If there were no federal minimum pr ices . . . , out-of-state producers might still be able to re tain their market share by lowering their prices.” Id. at 195. Under the argument pressed by Utah and the intervenors, the discriminatory effect in West Lynn Creamery would have been caused by the federal agency’s minimum-pricing program, rather than by the Massachusetts pricing order. But th e Supreme Court did not see it that way. Instead, the Court f ound discrimination based on the market realities14 faced by out-of-state dealers in a federal system mandating minimum prices. We should do the same here. Retailers outside Ut ah will be unable to match prices with Utah retailers, just as out-of-s tate dealers in West Lynn Creamery could not effectively compete wi th dealers inside Massachusetts. In both cases, the constr aints resulted from a third party’s requirement of minimum pricing. 5 In my view, there is no principled basis to find discrimination against interstate commerce in West Lynn Creamery and not here. E. The Manufacturers’ Ability to Disconti nue Sales in Utah The manufacturers can avoid this di scrimination at the retail level only by abandoning sa les in Utah. But the manufa cturers should not have to abandon sales with in Utah solely to retain equal treatment for retailers. The Supreme Court addressed a similar issue in City of Ph iladelphia v. New Jersey , 437 U.S. 617 (1978). There, the Court confronted a New Jersey statute that prevented entities from brin ging trash into New Jersey, holding that the statute discriminated based on the trash’s origin. 437 U.S. at 626-27. Companies could avoid the statute’s harsh effects by leaving the New Jersey market and shipping tras h to other states instead. But the companies did not have to leave New Jersey. And the contact-lens

5 The legality of the ma nufacturers’ minimum-pric ing policies is not at issue.15 manufacturers should not have to stop doing business with Utah-based retailers. Utah disagrees, pointing to Exxon Corporation v. Governor of Maryland , 437 U.S. 117 (1978). In Exxon , the Supreme Court upheld a Maryland statute, in part because “[s] ome refiners may choose to withdraw entirely from the Maryla nd market, but there is no reason to assume that their share of the entire supply [would] not be promptly replaced by other interstate refiners.” Id. at 127. The Court concluded that the Maryland statute would not curtail access to interstate gaso line refinery markets. The contact-lens market is differe nt. Contact-lens prescriptions are brand-specific; thus, if one of the co ntact-lens manufacturers left Utah, Utah retailers would be completely foreclosed fr om fulfilling prescription orders for that manufacturer’s prescriptions, limiting consumers’ access to certain contact lenses. Unlike gaso line, a fungible good, brand-specific contact lenses are unique goods that cannot be “promp tly replaced” by another manufact urer when one manufact urer exits a market. Some courts have relied on Exxon in upholding re strictions on interstate commerce. In each case, however, the courts noted that the restriction would cause commerce to shift among competitors, not reduce

commerce. See, e.g. , Yakima Valley Mem’l Hosp. v. Wash. State Dep’t of Health , 731 F.3d 843, 847 (9th Cir. 2013) (“ What is really at issue is the shifting of business from one competitor to a nother, not a burden on16 interstate commerce.”); Nat’l Ass’n of Optometris ts & Opticians v. Harris , 682 F.3d 1144, 1153 (9th Cir. 2012) (“[T]he Exxon Court’s decision turned on the interstate flow of goods . . . .”); Wood Marine Serv., Inc. v. City of Harahan , 858 F.2d 1061, 1065 (5th Cir. 1988) (expl aining that a city ordinance did not reduce the amount of commercia l material brought into Louisiana and upholding the ordinance in response to a dormant commerce clause challenge); Am. Motors Sale s Corp. v. Div. of Motor Vehicles of Commonwealth of Va. , 592 F.2d 219, 223 (4th Cir. 1979) (concluding that a statute that “affect[s] the structure of [a] reta il market by shifting business from one out-of-s tate manufacturer to anot her” does not run afoul of the dormant commerce clause). Utah’s statute is different: It may eliminate interstate comme rce. Therefore, Exxon ’s logic does not apply here. 6
* * * For these reasons, I respectfully disagree with the majority. The statute, as interpreted by the attorney general, discriminates between nonUtah and Utah retailers. Because of this discrimination, the district court should have upheld the statute only if it su rvived the “stricte st scrutiny” of a legitimate local

6 Exxon also did not involve discrimination against out-of-state retailers. See Exxon Corp. , 437 U.S. at 126 (noting th at the state statute at issue did not “distinguish between in-state and out- of-state companies in the retail market”).17 purpose and the absence of nond iscriminatory alternatives. Camps Newfound/Owatonna, Inc. v. Town of Harrison , 520 U.S. 564, 581 (1997). The district court did not apply the “str ictest scrutiny” to the statute, and Utah does not address wh ether the statute would survive this level of scrutiny. Without briefing on this issue, I would reverse and remand for the district court to apply strict scrutiny in the first instance. 7 Until the district court does so , it cannot properly asse ss the manufacturers’ likelihood of succe ss on the merits for the clai m involving discrimination against out-of-state retailers. III. The Remaining Prelim inary Injunction Factors The district court relied heavily on its mistaken view of the manufacturers’ likelihood of success. Alcon Labs., Inc. v. Reyes , No. 2:15- cv-00252-DB, at *16-18 (D. Utah May 11, 2015). This mistake colored the district court’s assessment of the other elements fo r a preliminary injunction (irreparable injury, balanc ing of the equities, and the public interest). See Winter v. Nat. Re s. Def. Council, Inc. , 555 U.S. 7, 20 (2008). We do not know how the district court woul d have rule d if it had correctly assessed the manufactur ers’ likelihood of success. See Lawson Prods., Inc. v. Avnet, Inc. , 782 F.2d 1429, 1437-38 (7 th Cir. 1986) (noting how the “cold record” before an appe llate court precludes a full “sense of

7 The parties do not address whether Utah has waived an argument that the statute would survive und er strict scrutiny. I wo uld leave the issue of a potential waiver to the di strict court on remand.18 the equities or the mer its of a case” to grant a preliminary injunction). Thus, I believe that we s hould reverse and remand fo r the district court to reconsider the equitable elemen ts based on the Utah statute’s discrimination against interstate commerce. See Derma Pen, LLC v. 4EverYoung Ltd. , 773 F.3d 1117, 1121 (10th Ci r. 2014) (reversing and remanding for reconsideration of the equitable factors for a preliminary injunction because of the district court’s erroneou s assessment of likelihood of success); see also eBay Inc. v. MercExchange, L.L.C. , 547 U.S. 388, 394 (2006 ) (vacating and remanding fo r the district court to apply its equitable discretion). IV. Conclusion I believe that the district court committed reversible error in its determination regarding lik elihood of success. Th us, I would reverse and remand for the district court to (1) ap ply strict scrutiny and (2) reconsider the remaining preliminary injunction factors of irreparable injury, balancing of the equities , and the public interest.