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Ninth Circuit ruling extends antitrust protection

This article was originally published in The Gray Sheet

Executive Summary

In a Jan. 6 decision on Allied Orthopedic Appliances Inc. v. Tyco Health Care Group LP, the Ninth Circuit held that U.S. antitrust laws do not prevent a monopolist from improving its products, even when the improvement adversely affects competition, according to a client advisory from the law firm Arnold & Porter. Plaintiffs had alleged that a redesign of a medical device composed of a sensor and a monitor to receive, interpret and display information from the sensor rendered the device's monitors incompatible with the competitors' generic sensors, according to the advisory. However, the court ruled in favor of the defendant, who proved that the redesign also provided new features and reduced the overall cost, the law firm notes. Arnold & Porter cautions that while manufacturers now have more antitrust protection in the Ninth Circuit, other state, federal and foreign jurisdictions may have laws "that are less clear than, or even contrary to, Allied.
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