The pen may be mightier than the sword, but not necessarily mightier than the table saw. On July 15, 2014, in SD3 v. Black & Decker (U.S.), Inc., Case No. 1:14-cv-191 (E.D. Va.), District Judge Claude M. Hilton dismissed antitrust claims by SD3 and Sawstop against several manufacturers of table saws, a trade association, and a standards setting body. Plaintiffs alleged that defendants conspired to boycott plaintiffs and conspired to exclude their technology from table saw safety standards, in violation of Section 1 of the Sherman Act and Ohio and Illinois law. Judge Hilton rejected plaintiffs’ allegations, holding that the complaint did not plausibly allege anything more than unilateral conduct by each defendant and normal standards-setting conduct, which was insufficient to state an antitrust claim.
In 2000, plaintiffs allegedly developed a new technology that would make table saws safer. According to plaintiffs, the manufacturer defendants conspired to boycott this new technology in 2001 out of desire to reduce costs (by avoiding royalty payments) and also to reduce liability (if some manufacturers adopted the technology but not others, the others might be subject to product liability suits). Judge Hilton found these allegations implausible because three defendants allegedly entered into licensing negotiations with plaintiffs after 2001, when the conspiracy was allegedly underway. Judge Hilton also found that plaintiffs’ allegations regarding defendants’ liability concerns were based on out-of-context testimony given in other cases, which, when read in context, showed that defendants were concerned with finding the safest alternative. Judge Hilton further noted that there was no plausible allegation of harm to competition, because plaintiffs had been manufacturing and selling table saws incorporating their own safety technology for ten years.
Judge Hilton then turned to plaintiffs’ allegations of a “standards conspiracy.” According to plaintiffs, defendants conspired to manipulate industry standards for table saws so that revisions to those standards in 2005 and 2007 excluded plaintiffs’ safety technology. Judge Hilton quickly dispensed with these allegations, holding that they described nothing more than typical standards-setting conduct that was not unlawful: “[N]either mere participation in a standards-setting body nor mere membership in a trade association is sufficient to state an antitrust conspiracy claim.” As standards-setting bodies typically do, they endorse one standard. Plaintiffs had no claim simply because their technology was not selected as the standard: “Here, UL did not exclude ‘SawStop’ technology from the market in any way; it merely declined to impose it upon the market.” Again, Judge Hilton noted the absence of any harm to competition.
Judge Hilton also noted that many of the allegations in the complaint grouped or lumped defendants together, which was insufficient because it failed to state “sufficient facts as to each defendant joining the conspiracy and their role within it.”
Plaintiffs are appealing the decision to the Fourth Circuit.