Opinion ID: 2812632
Heading Depth: 4
Heading Rank: 1

Heading: Risk of Regulatory Scrutiny

Text: We have not had occasion to decide whether the risk that an action will trigger regulatory scrutiny may give an absent antitrust co-conspirator a legally protected interest under Rule 19(a). Without deciding whether such a risk might give an absent party an interest under different circumstances, we hold that Apple has not shown that the risk of regulatory scrutiny ATTM faces as a result of this action gives ATTM a legally protected interest. Apple relies heavily on the Eleventh Circuit’s decision in Laker Airways, Inc. v. British Airways PLC, 182 F.3d 843 WARD V. APPLE, INC. 23 (11th Cir. 1999). In Laker Airways, the court considered whether a private corporation appointed by the government of the United Kingdom to coordinate airlines’ requests for landing and take-off times was a necessary party to an action alleging that the corporation conspired with an airline to monopolize the market for passenger air service between two cities. Id. at 845. The Eleventh Circuit held that the district court had not abused its discretion when it found that the coordinating corporation was a required party under Rule 19(a). Id. In finding that the specific circumstances of the case made the corporation’s interests “more significant than those of a routine joint tortfeasor,” id. at 847–48, the court cited the regulatory scrutiny the corporation could face as a result of the litigation. Under the regulations of the United Kingdom, the coordinating corporation was required to be “independent,” and was to act in a “neutral, non- discriminatory and transparent way.” Id. at 846. United Kingdom law further provided that the corporation’s appointment as coordinator would be withdrawn if the corporation failed to act in an independent manner. Id. The court reasoned: [i]n order to prove its antitrust claims, [the plaintiff] would be required to show that [the defendant] acted in other “than an independent manner.” Such a ruling would surely implicate the interests of [the absent corporation] because the United Kingdom’s enabling legislation . . . requires that the 24 WARD V. APPLE, INC. Secretary of State for Transport withdraw its approval of an appointed coordinator if its behavior is not neutral. Id. at 848. Laker Airways is inapposite. There the relevant agency was affirmatively required to withdraw approval of the absent coordinator if its behavior was not neutral. See id. By contrast, there is no suggestion in this case that the collateral regulatory consequences ATTM might face as a result of this action would be any more severe, or likely to occur, than in a typical case alleging an antitrust conspiracy. If the vague risk of increased regulatory scrutiny in this case made ATTM a required party, absent antitrust co-conspirators would, almost always, be required parties in a broad range of antitrust cases. Such a result would eviscerate the general rule that absent antitrust co-conspirators need not be joined in one action. See Lawlor, 349 U.S. at 329; Georgia v. Penn. R.R., 324 U.S. at 463. Moreover, we have been reluctant to recognize legally protected interests based solely on “[s]peculation about the occurrence of a future event.” See Northrop Corp. v. McDonnell Douglas Corp., 705 F.2d 1030, 1046 (9th Cir. 1983) (“Speculation about the occurrence of a future event ordinarily does not render all parties potentially affected by that future event necessary or indispensable parties under Rule 19.”); Cachil Dehe Band, 547 F.3d at 973 (holding that absent Indian tribes’ opportunity to obtain licenses under gaming compact was not a legally protected interest where the “likelihood of obtaining future licenses [was] attenuated”). In the absence of any evidence that lawenforcement or regulatory agencies are presently scrutinizing the Exclusivity Agreement, we decline to speculate whether the outcome of this case will impact agencies’ enforcement WARD V. APPLE, INC. 25 decisions. For these reasons, we find that Apple has not demonstrated that the risk of regulatory scrutiny gives ATTM a legally protected interest in this action.