Court Opinion

ID: 3155991
Source: CourtListenerOpinion
Date Created: 2015-11-19 15:00:21.264406+00
Date Added: 2024-06-11T12:02:02.716124
License: Public Domain

15-1161
     Planetarium Travel, Inc. v. Altour International Inc. et al.

                          UNITED STATES COURT OF APPEALS
                              FOR THE SECOND CIRCUIT

                                     SUMMARY ORDER
     RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
     ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
     PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
     DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
     ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
     SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1            At a stated term of the United States Court of Appeals
 2       for the Second Circuit, held at the Thurgood Marshall United
 3       States Courthouse, 40 Foley Square, in the City of New York,
 4       on the 19th day of November, two thousand fifteen.
 5
 6       PRESENT: DENNIS JACOBS,
 7                DEBRA ANN LIVINGSTON,
 8                CHRISTOPHER F. DRONEY,
 9                              Circuit Judges.
10
11       - - - - - - - - - - - - - - - - - - - -X
12       PLANETARIUM TRAVEL, INC.
13                Plaintiff-Appellant,
14
15                    -v.-                                               15-1161
16
17       ALTOUR INTERNATIONAL INC.,
18                Defendant-Appellee.
19       - - - - - - - - - - - - - - - - - - - -X
20
21       FOR APPELLANT:                        DAVID DETOFFOL, DETOFFOL &
22                                             ASSOCIATES, New York, New York.
23
24       FOR APPELLEE:                         EVAN SHAPIRO, SKARZYNSKI BLACK
25                                             LLC, New York, New York.
26
27            Appeal from a judgment of the United States District
28       Court for the Southern District of New York (Torres, J.).

                                                  1
 1
 2        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
 3   AND DECREED that the judgment of the district court be
 4   AFFIRMED.
 5
 6        Planetarium Travel, Inc. (“Planetarium”) appeals from
 7   the judgment of the United States District Court for the
 8   Southern District of New York (Torres, J.), granting Altour
 9   International Inc’s (“Altour”) motion to dismiss this
10   antitrust case. We assume the parties’ familiarity with the
11   underlying facts, the procedural history, and the issues
12   presented for review.
13
14        Planetarium’s complaint alleges that Altour, another
15   supplier, induced American Express Travel Related Services
16   Company, Inc. (“Amex”), a distributor, not to renew
17   Planetarium’s franchise agreement with Amex. Planetarium’s
18   antitrust claim is thus based on a vertical restraint. See
19   Bus. Elecs. Corp. v. Sharp Elecs. Corp., 485 U.S. 717, 730
20   (1988) (“Restraints . . . imposed by agreement between firms
21   at different levels of distribution [are] vertical
22   restraints.”). “[V]ertical restraints are generally subject
23   to ‘rule of reason’ analysis.” Elecs. Commc’ns Corp. v.
24   Toshiba Am. Consumer Prods., Inc., 129 F.3d 240, 243 (2d
25   Cir. 1997); see also Leegin Creative Leather Prods., Inc. v.
26   PSKS, Inc., 551 U.S. 877, 907 (2007).
27
28        To establish an antitrust violation under the rule of
29   reason: (1) plaintiff “‘bears the initial burden of showing
30   that the challenged action has had an actual adverse effect
31   on competition as a whole in the relevant market’”; (2) if
32   the plaintiff carries this burden, “the burden shifts to the
33   defendant to establish the ‘pro-competitive redeeming
34   virtues’ of the action”; (3) should the defendant make this
35   showing, “the plaintiff must then show that the same pro-
36   competitive effect could be achieved through an alternative
37   means that is less restrictive of competition.” K.M.B.
38   Warehouse Distribs., Inc. v. Walker Mfg. Co., 61 F.3d 123,
39   127 (2d Cir. 1995) (quoting Capital Imaging Assocs., P.C. v.
40   Mohawk Valley Med. Assocs., Inc., 966 F.2d 537, 543 (2d Cir.
41   1993)). Planetarium’s initial burden in this analysis can
42   be discharged in two different ways: alleging an “actual
43   adverse effect on competition, such as reduced output,” or
44   “indirectly by establishing that [the competitor] had
45   sufficient market power to cause an adverse effect on
46   competition.” Tops Mkts., Inc. v. Quality Mkts., Inc., 142
47 F.3d 90, 96 (2d Cir. 1998). Importantly, “[b]ecause the

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 1   antitrust laws protect competition as a whole, evidence that
 2   plaintiffs have been harmed as individual competitors will
 3   not suffice.” Geneva Pharm. Tech. Corp. v. Barr Labs.,
 4   Inc., 386 F.3d 485, 507 (2d Cir. 2004).
 5
 6        Planetarium has failed to allege an actual adverse
 7   effect on competition. “[E]xclusive distributorship
 8   arrangements are presumptively legal,” and Planetarium has
 9   failed to explain how this arrangement would impair
10   competition in the sales of first class and business class
11   airline tickets. Elecs. Commc’ns Corp., 129 F.3d at 245.
12   Nor has Planetarium alleged that Altour has sufficient
13   market power to adversely affect competition. At most, an
14   examination of the complaint and its attached documents
15   reveals that Altour is the 13th largest travel agency in the
16   United States and that Amex was only recouping 9 % of travel
17   spending from its card members. These factual allegations
18   provide no indication that such market share gives rise to
19   market power, i.e., the ability “to raise price
20   significantly above the competitive level without losing all
21   of [its] business.” K.M.B. Warehouse Distribs., 61 F.3d at
22   129 (quoting Graphic Prods. Distribs., Inc. v. ITEK Corp.,
23   717 F.2d 1560, 1570 (11th Cir. 1983)). The district court
24   correctly ruled that Planetarium did not plausibly allege a
25   violation of the antitrust laws.
26
27        For the foregoing reasons, and finding no merit in
28   Planetarium’s other arguments, we hereby AFFIRM the judgment
29   of the district court.
30
31                              FOR THE COURT:
32                              CATHERINE O’HAGAN WOLFE, CLERK
33

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