Court Opinion

ID: 6966687
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:55:08.021227+00
Date Added: 2024-06-11T16:08:38.538802
License: Public Domain

O’SCANNLAIN, Circuit Judge,
dissenting only as to Part II.B.2.
I respectfully dissent from Part II.B.2 of the opinion, written by Judge Tashima.
The majority holds that Lucas Automotive has consumer standing to assert a section 7 claim for equitable relief, including divestiture, under section 16 of the Clayton Act. However, our decision in Rebel Oil Co., Inc. v. Atlantic Richfield Co., 51 F.3d 1421 (9th Cir.1995), viewed in conjunction with the Supreme Court’s decision in Cargill, Inc. v. Monfort of Colorado, Inc., 479 U.S. 104, 107 S.Ct. 484, 93 L.Ed.2d 427 (1986), compels the opposite conclusion.
As the Supreme Court held in Cargill, in order to establish antitrust standing to sue for divestiture under section 16 of the Clayton Act, a plaintiff is required to “allege threatened loss or damage ‘of the type the antitrust laws were designed to prevent and that flows from that which makes defendants’ acts unlawful.’ ” Cargill, 479 U.S. at 113,107 S.Ct. at 491 (quoting Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 697-98, 50 L.Ed.2d 701 (1977)). The majority concludes that, as a purchaser of tires at the subdistributor level, Lucas Automotive is threatened with antitrust injury resulting from Coker Tire’s acquisition of market power at the distributor level. I respectfully disagree with the majority’s conclusion, as it conflicts with our decision in Rebel Oil.
In Rebel Oil, we held that market power may be demonstrated in one of two ways. First, the plaintiff may offer “direct evidence of the injurious exercise of market power.” Id. at 1434. Lucas Automotive offers no direct evidence of a threat of the injurious exercise of market power by Coker Tire.
Second, the plaintiff may offer “circumstantial evidence pertaining to the structure of the market.” Id. To demonstrate market power circumstantially, a plaintiff must: “(1) define the relevant market, (2) show that the defendant owns a dominant share of that' market, and (3) show that there are significant barriers to entry and show that existing competitors lack the capacity to increase their output in the short run.” Id. at 1434 (emphasis added).
The majority concludes that, after its acquisition of the right to distribute Firestone tires, Coker Tire possessed market power at the distributor level. However, although the majority does offer support for its conclusions that Coker Tire owns a dominant share of the relevant market and that there are significant barriers to entry, it fails to point to evidence in the record sufficient to demonstrate that Coker Tire’s competitors, including Kelsey Tire, lack the capacity to expand their output in response to a price increase by Coker Tire.
Lucas Automotive argues in its brief that “Coker ... has the power to restrict output and raise prices without a competitive response, and to exclude competition.” In support of this assertion, Lucas Automotive cites only a conclusory statement by Stanley Lucas. However, conclusory allegations unsupported by factual data are insufficient to defeat a motion for summary judgment. See Angel v. Seattle-First Nat’l Bank, 653 F.2d 1293,1299 (9th Cir.1981).
The only support that the majority offers for its tenuous (but essential to its holding) conclusion that Kelsey Tire “lack[s] the capacity to increase [its] output in the short *1238run,” Rebel Oil, 51 F.3d at 1434, is that “the Goodyear brand of vintage tires controlled by Kelsey is limited in terms of size.” See Majority Opinion at 2898. Lucas Automotive has offered not a shred of evidence as to the cross elasticity of demand1 between original equipment vintage tires of different sizes. Consequently, it is difficult to understand (based on the record before us) how the fact that Coker Tire distributes a greater range of tire sizes than Kelsey Tire suggests that Kelsey Tire cannot “increase [its] output in the short run” following a price increase by Coker Tire.2 See Rebel Oil, 51 F.3d at 1434. Indeed, the majority’s analysis only seems to underscore why Lucas Automotive failed to produce sufficient evidence to survive summary judgment.
I would affirm the district court’s holding that Lucas Automotive lacks standing under section 16 of the Clayton Act.

. The cross elasticity of demand measures the percentage change in the quantity of a good demanded for each one-percent change in the price of a substitute good. See H. Hovenkamp, Economics and Federal Antitrust Law ¶ 1.1, at 62 (1985).

. I do not take the majority’s analysis as challenging the district court’s conclusion that the relevant market is that of original equipment vintage tires, as distinguished from original equipment vintage tires of a particular size.