The US Supreme Court has asked Solicitor General John Sauer to offer the federal government’s response to an antitrust case involving Duke Energy.
A federal Appeals Court determined in August 2024 that Florida-based NTE Carolinas could move forward with monopoly claims against Duke. The complaint focused on allegations that Duke attempted to block NTE from competing for Fayetteville’s energy business.
Duke Energy filed a petition in February asking the nation’s highest court to take the case. NTE Carolinas responded in April.
The Supreme Court’s order list Monday included a reference to the case. “The Solicitor General is invited to file briefs … expressing the views of the United States.”
“The task of the Office of the Solicitor General (OSG) is to supervise and conduct government litigation in the United States Supreme Court,” according to the office’s website.
A unanimous three-judge 4th US Circuit Court of Appeals panel ruled against Duke Energy last summer. The panel threw out a trial judge’s ruling in the dispute. The full 4th Circuit voted, 11-2, in November against hearing the case en banc.
Duke’s Supreme Court petition criticized the 4th Circuit panel’s decision.
“This petition presents an important and recurring question of antitrust law: when can 0 + 0 = 1? The district court found that antitrust math is no different from ordinary arithmetic. If an antitrust plaintiff pleads a series of independently lawful acts, each of which does not violate this Court’s precedents, those acts cannot together add up to some nebulous antitrust violation,” Duke’s lawyers wrote. “The court of appeals concluded otherwise, embracing a ‘monopoly broth’ theory prominent in the 1960s to 1980s but long since discarded.”
“This Court’s intervention is needed to restore antitrust law to the principles that have governed for the last three decades,” the petition continued.
The 4th Circuit “bucked” the consensus of “[f]ive courts of appeals, numerous district courts, and the leading antitrust treatise” about the proper approach to the case, Duke’s lawyers argued.
“[T]o get around this Court’s well-established tests for predatory pricing, refusals to deal, and sham litigation, NTE dusted off the old monopoly-broth playbook, arguing that Duke was liable because of its overall ‘anticompetitive scheme,’” the petition argued. “This time, the move worked. Breaking from decades of case law, the Fourth Circuit held that antitrust plaintiffs can add up distinct, independently lawful actions and put their ‘combined effect’ before a jury.”
NTE Carolinas rebutted Duke’s arguments in its Supreme Court brief.
“The Fourth Circuit held that respondents have a triable monopolization case for two independent reasons,” the brief explained. “First, a reasonable jury could find multiple acts by Duke unlawful under this Court’s canonical tests for predatory pricing and refusal to deal. Second, petitioners’ conduct involved ‘a complex or atypical exclusionary campaign, the individual components of which do not fit neatly within pre-established categories.’”
“Because this Court’s specific tests for common types of monopolistic conduct do not cover all the ‘many different forms’ of anticompetitive conduct, which ‘cannot always be categorized,’ the court below also considered Duke’s course of conduct ‘as a whole’ and found that a reasonable jury could find it anti-competitive,” NTE Carolinas’ lawyers wrote.
Appeals Court Judge Paul Niemeyer wrote for the unanimous 4th Circuit panel that ruled against Duke last summer.
“In particular, NTE presented evidence in the district court that Duke devised a plan to ensure that NTE, its only serious competitor, would not have the opportunity to compete for the business of Fayetteville, North Carolina, the only major wholesale customer whose long-term contract with Duke was expiring soon enough to allow NTE to compete for its business,” Niemeyer wrote.
“The district court granted Duke’s motion for summary judgment, in which Duke argued that the conduct that NTE imputed to Duke constituted legitimate competition in seeking to retain Fayetteville’s business and that none of the actions on which NTE relied was unlawful,” Niemeyer added. “While the court concluded that there was a question of fact on whether Duke had monopoly power, it also concluded as a matter of law that Duke did not engage in anticompetitive conduct but rather legitimate competition to retain Fayetteville’s business.”
“While we recognize that much of Duke’s conduct can be understood to be legitimate competitive conduct, … we also have found much from which a jury could conclude that Duke’s actions were illegitimate anticompetitive conduct that violated § 2 of the Sherman Act,” the 4th Circuit opinion continued. “Because genuine disputes of material fact exist, we vacate the district court’s summary judgment and remand for further proceedings.”
If the US Supreme Court decides to take the case, it could appear on the court’s calendar for consideration in the session that will begin in the fall.
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