Aftermarket Monopolization Claims Dismissed As Afterthought

Plaintiff Océ North America, Inc. ("Océ") brought an action against a service market supplier for copyright infringement. Defendant MCS Services, Inc. ("MCS") filed a Kodak-style "aftermarket" monopolization counterclaim, in addition to a series of common law torts, including tortuous interference with contractual relations, and prospective advantage. Finding the antitrust allegations of the counterclaim to be "implausible", the district court for the District of Maryland dismissed that claim, while allowing the tortuous interference claims to continue. Océ North America, Inc. v. MCS Services, Inc., D.Md., No. 1:10-CV-984-WMN, 6/14/11.

Océ manufactures high speed continuous form printers. Such printers utilize large spools of perforated paper. Continuous form printers are capable of printing hundreds, or even thousands, of pages per minute. They range in price from a mere $100,000 to in excess of $1 million, with a lifespan of approximately 20 years. MCS does not manufacture printers. However, both Océ and MCS are competitors in the business of providing maintenance services and replacement toner for high-speed printers. Océ filed a complaint alleging that MCS had misappropriated its trade secrets. MCS retaliated by filing counterclaims alleging monopolization and attempted monopolization, and several species of state tort claims, including tortuous interference with contractual and prospective advantage. In dismissing the antitrust counts, the court noted that the monopolization and attempted monopolization claims were based upon the "aftermarket relevant market theory" of Eastman Kodak Co. v. Image Technical Services, Inc., 504 U.S. 451 (1992) (Kodak-I). In Kodak, the Supreme Court sustained a reversal of summary judgment dismissing claims that Kodak had imposed an illegal tying arrangement and had monopolized and attempted to monopolize the aftermarket for sales and service of its own original equipment sales. On the facts of Kodak-I, the Court found sufficient allegations of market power where there was an "asymmetry of information" about "product life cycles," and where competing suppliers of sales and service in the original equipment aftermarket had been the victims of exclusionary conduct. In a change in position by the OEM, it required that its purchasers utilize Kodak parts and services for repair and maintenance. This change in position, coupled with the lack of information on the product life cycle, "locked-in" uses of the...