U.S. Tenth Circuit Court Dismisses Private Defendant's Appeal Claiming Antitrust Immunity

In an antitrust decision of national significance, on January 4, 2013 Jones & Keller senior litigator Tom McMahon won a favorable ruling from the U.S. Court of Appeals for the Tenth Circuit in Denver. The appellate court held that a private defendant may not invoke the "collateral order" doctrine to immediately appeal a trial court’s ruling that the defendant does not have state action immunity from the antitrust laws. The case is Auraria Student Housing at the Regency, LLC v. Campus Village Apartments. LLC, ___ F.3d ___, 2013 WL 49596 (10th Cir. Jan. 4, 2013).

In the fall of 2010 Jones & Keller filed suit in U.S. District Court in Denver on behalf of its client, the Regency. The complaint alleged that defendant Campus Village had conspired with the University of Colorado-Denver ("UCD") to monopolize private, off-campus dedicated student housing apartment facilities for the Auraria Higher Education Center in violation of Section 2 of the Sherman Act, 15 U.S.C. §2. According to the complaint, the two agreed that UCD would require most of its full-time students to live at Campus Village’s apartments for their first two semesters, rather than being able to live at the Regency or elsewhere. As a result, students paid more and received less at Campus Village and the Regency lost business.

Campus Village moved to dismiss the complaint, asserting that under the doctrine of Parker v. Brown, 317 U.S. 341 (1943), it had state action immunity from the antitrust laws. Jones & Keller opposed that on behalf of the Regency, relying heavily on the Tenth Circuit’s then-recent decision in Kay Elec. Co-op v. City of Newkirk, 647 F.3d 1039 (10th Cir. 2011). In late 2011 the trial court denied the motion. 825 F.Supp.2d 1072 (D.Colo. 2011). Campus Village then filed an immediate appeal, asserting that it was entitled to do so under the collateral order doctrine of Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949), and re-asserting entitlement to state action immunity.

On January 4, 2013, the Tenth Circuit rejected the appeal. It noted that a split exists among federal appellate courts regarding whether the denial of state action immunity prior to trial is immediately appealable as a collateral order. The U.S. Courts of Appeals for the Fourth and Sixth Circuits have held it is not. See S.C. State Bd. of Dentistry v. FTC, 455 F. 3d 436 (4th Cir. 2006); Huron Valley Hosp., Inc. v. City of Pontiac, 792 F.2d 563 (6th Cir. 1986). Those for the Fifth and Eleventh Circuits have held, conversely, that it is. See Martin v. Mem'l Hosp., 86 F.3d 1391 (5th Cir. 1996); Commuter Transp. Sys., Inc. v. Hillsborough Cnty. Aviation Auth., 801 F.2d 1286 (11th Cir. 1986).

The Tenth Circuit emphasized, however, that even the Fifth Circuit does not allow private defendants to utilize the collateral order doctrine as a vehicle for immediately appealing the denial of state action immunity. See Acoustic Sys., Inc. v. Wenger Corp., 207 F.3d 287 (5th Cir. 2000), pointing out that immunity concerns regarding governmental defendants simply aren’t implicated where a private party is the entity claiming state action immunity. Consequently, the Tenth Circuit dismissed Campus Village’s appeal without even needing to address the underlying state action immunity issue.

The case now returns to the district court for trial.