Loren Data Corporation v. GXS, Inc.

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-2062
LOREN DATA CORPORATION,
Plaintiff - Appellant,
v.
GXS, INC.,
Defendant - Appellee.
Appeal from the United States District Court for the District of
Maryland, at Greenbelt. Deborah K. Chasanow, Chief District
Judge. (8:10-cv-03474-DKC)
Argued: September 20, 2012 Decided: December 26, 2012
Before NIEMEYER and KEENAN, Circuit Judges, and Michael F.
URBANSKI, United States District Judge for the Western District
of Virginia, sitting by designation.
Affirmed by unpublished opinion. Judge Urbanski wrote the
opinion, in which Judge Niemeyer and Judge Keenan joined.
ARGUED: Glenn B. Manishin, TROUTMAN SANDERS, LLP, Washington,
D.C., for Appellant. Robert A. Schwinger, CHADBOURNE & PARKE,
LLP, New York, New York, for Appellee. ON BRIEF: David H.
Evans, CHADBOURNE & PARKE, LLP, Washington, D.C.; Benjamin D.
Bleiberg, CHADBOURNE & PARKE, LLP, New York, New York, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
URBANSKI, District Judge:
Loren Data Corporation (“Loren Data”) filed a
complaint against GXS, Inc. (“GXS”) alleging violations of
Sections 1 and 2 of the Sherman Antitrust Act, 15 U.S.C. §§ 1,
2, the Maryland antitrust statute, as well as common law claims
of tortious interference and breach of contract. The district
court granted GXS’s motion to dismiss Loren Data’s antitrust
claims. Because the district court correctly recognized that
Loren Data failed to allege a plausible conspiracy in restraint
of trade in violation of Section 1 of the Sherman Act or facts
sufficient to state a plausible Section 2 claim, we affirm.
I.
Loren Data and GXS are engaged in the Electronic Data
Interchange industry. Electronic Data Interchange (“EDI”) is
the transfer and exchange of business data from one computer
system to another using a standard digital format. EDI messages
are generated, sent, and received by business computing systems
for parties engaged in commercial trading, and often include the
transmission of business information such as invoices and
purchase orders. EDI messages travel over secure, private data
networks called Value Added Networks (“Networks”). Both GXS and
Loren Data operate such Networks. Loren Data alleges that the
GXS Network is the market leader, and this case concerns GXS’s
2
refusal to allow Loren Data to connect to the GXS Network in the
manner sought by Loren Data.
Networks transfer business information in two ways,
referred to in the industry as a non-settlement peer
interconnect (“peer interconnect”) and a commercial mailbox.
When data is transmitted over a peer interconnect, each Network
bears its own costs associated with the transfer of data, and
neither Network charges the other for the data transmission. In
contrast, Networks communicating via a commercial mailbox charge
each other based on the volume of data transferred. Loren Data
alleges that a peer interconnect is the industry standard and
that a commercial mailbox is cumbersome, inefficient, and
expensive. While Loren Data has had access to the GXS Network
by means of a commercial mailbox, it charges a violation of the
antitrust laws because GXS has refused to grant it a peer
interconnect.
Loren Data’s efforts to obtain a peer interconnect
from GXS span the last decade. The amended complaint alleges
that Loren Data began negotiations with GXS to secure a peer
interconnect in November 2000. While negotiations were
underway, GXS made a commercial mailbox available to Loren Data
as an interim solution. In August 2001, GXS declined Loren
Data’s request for a peer interconnect and notified Loren Data
that it would terminate the commercial mailbox if $30,000.00 in
3
overdue fees owed by Loren Data were not paid. When Loren Data
did not pay the overdue fees, GXS terminated the commercial
mailbox. Loren Data approached GXS again in 2002 to establish a
peer interconnect, but that request too was denied.
In August 2003, Loren Data again approached GXS about
a peer interconnect, this time because a potential customer,
Covisint, required routing to commercial trading partners on the
GXS Network. Although Loren Data had, by this time, settled its
outstanding accounts with GXS, GXS declined to provide a peer
interconnect, again offering a commercial mailbox. Despite the
fact that Loren Data could only offer Covisint a commercial
mailbox connection to the GXS Network, Covisint contracted with
Loren Data. 1
Matters came to a head in 2010. In a letter dated
September 3, 2010, GXS addressed the terms under which it was
willing to do business with Loren Data. This letter, attached
1
While the commercial mailbox relationship between Loren
Data and GXS has been the norm over the last decade, there have
been exceptions. From 2005 to 2009, GXS allowed Loren Data a
peer interconnect for traffic pursuant to an outsourcing
contract between Loren Data and IBM. In 2009, Loren Data signed
a transit agreement with Inovis, Inc. which gave Loren Data
indirect access to the GXS Network through the InovisWorks
Network. Loren Data alleges that GXS indicated that it would
not renew or extend the InovisWorks transit agreement upon its
expiration in May 2011.
4
as an exhibit to the amended complaint, forms the core of Loren
Data’s Sherman Act Section 1 conspiracy allegation.
In the September 3, 2010 letter, GXS explained that it
could not offer Loren Data anything more than a commercial
mailbox because it believed Loren Data’s business model to be
incompatible with its own. GXS characterized Loren Data’s
business model as a “service bureau.” As a “service bureau,”
GXS asserted that Loren Data was focused exclusively on selling
a connection to the GXS Network and did not provide the value
associated with other Networks, which GXS contended are focused
on growing the overall EDI market.
GXS also expressed concern that providing a peer
interconnect to Loren Data would result in service quality
problems. GXS stated that the core of Loren Data’s business
model involves message “daisy chaining.” GXS distinguished
daisy chaining from the “one-hop” approach employed by GXS in
which “messages traverse one network and stop.” In contrast,
daisy chaining allows a message to hop from Network to Network.
According to GXS, “[a] proliferation of daisy chaining increases
GXS[’s] risks in its ability to manage service latency,
availability, and overall service quality.” The September 3,
2010 letter stated that GXS’s current Network interconnect
agreements expressly prohibit daisy chaining.
5
The amended complaint alleges that both GXS and Loren
Data have peer interconnect agreements with all of the 36 other
EDI Networks. Regardless, Loren Data alleges that peer
interconnect access to the GXS Network is essential to
competition because that Network controls over 50 percent of the
market. Although Loren Data alleges a concerted refusal to
deal, the amended complaint states that “[c]urrently about 55%
of Loren Data’s business travels on GXS [Networks].”
II.
Loren Data filed a complaint on December 13, 2010
alleging that GXS’s refusal to provide it a peer interconnect to
the GXS Network violated Sections 1 and 2 of the Sherman Act,
the Maryland antitrust statute, and the common law. GXS moved
to dismiss the complaint pursuant to Federal Rule of Civil
Procedure 12(b)(6). In response to GXS’s motion to dismiss,
Loren Data filed an amended complaint, which incorporated the
original complaint, introduced supplemental facts, and attached
the September 3, 2010 letter, which it believed evidenced the
agreement to restrain trade.
On August 9, 2011, the district court dismissed the
action. The district court reasoned that Loren Data failed to
allege specific facts in support of a Section 1 conspiracy, and,
in fact, the facts alleged suggest the absence of an agreement
6
in restraint of trade. As to the Section 2 monopolization
claim, the district court held that Loren Data did not properly
allege a plausible essential facilities claim or that the
alleged refusal to deal constituted unlawful exclusionary
conduct. The district court also held that Loren Data’s
attempted monopolization claim did not sufficiently allege the
specific intent to monopolize or a dangerous probability of
successful monopolization.
Loren Data filed two post-judgment motions that the
district court construed as motions to alter judgment pursuant
to Federal Rule of Civil Procedure 59(e). In those motions,
Loren Data sought clarification as to whether the case was
dismissed with or without prejudice and reconsideration of the
dismissal. The court denied the motions and ordered that the
case be dismissed with prejudice. This appeal followed. 2
III.
An order granting dismissal under Rule 12(b)(6) is
reviewed de novo. See E.I. du Pont de Nemours & Co. v. Kolon
2
Loren Data did not appeal the district court’s rulings as
to its Maryland common law claims and those portions of its
Maryland antitrust claims that do not parallel its Sherman Act
claims. As such, these claims are not addressed herein.
Likewise, there is no need to undertake separate analysis of the
parallel Maryland antitrust claims, as resolution of those
claims is subsumed in the Sherman Act analysis.
7
Indus., 637 F.3d 435, 440 (4th Cir. 2011). The Supreme Court
in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007),
articulated a two-pronged approach to assessing the sufficiency
of a complaint. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009).
First, the complaint must allege facts sufficient to support the
legal conclusions in the complaint, as Federal Rule of Civil
Procedure 8 requires “more than labels and conclusions,” and
admonishes against “a formulaic recitation of the elements of a
cause.” Twombly, 550 U.S. at 555. Second, “[t]o survive a
motion to dismiss, a complaint must contain sufficient factual
matter, accepted as true, to ‘state a claim to relief that is
plausible on its face.’” Iqbal, 556 U.S. at 678(quoting Twombly, 550 U.S. at 557). Plausibility requires that
the factual allegations “be enough to raise a right to relief
above the speculative level . . . on the assumption that all the
allegations in the complaint are true.” Twombly, 550 U.S. at
555; see, e.g., Robertson v. Sea Pines Real Estate Companies,
Inc., 679 F.3d 278, 288 (4th Cir. 2012).
In the context of an agreement to restrain
trade, Twombly teaches that a court may not simply credit
conclusory allegations of conspiracy. 550 U.S. at 555. Rather,
the court must determine whether the well-pleaded, non-
conclusory factual allegations give rise to a “plausible
suggestion of conspiracy.” Id. at 565-66. As the district
8
court correctly concluded, the factual allegations in this case
fail to reach that level.
IV.
A.
Count I of Loren Data's amended complaint alleges a
violation of Section 1 of the Sherman Act. Section 1 of the
Sherman Act states that: “Every contract, combination in the
form of trust or otherwise, or conspiracy, in restraint of trade
or commerce among the several states, or with foreign nations,
is declared to be illegal.” 15 U.S.C. § 1. To establish a
Section 1 violation, a plaintiff must prove, and therefore
plead, “(1) a contract, combination, or conspiracy; (2) that
imposed an unreasonable restraint of trade.” Dickson v.
Microsoft Corp., 309 F.3d 193, 202 (4th Cir. 2002).
“Not every instance of cooperation between two people
is a potential ‘contract, combination . . . or conspiracy, in
restraint of trade.’” Am. Needle, Inc. v. Nat’l Football
League, 130 S. Ct. 2201, 2208 (2010). The term “contract,
combination . . . or conspiracy” in Section 1 applies only to
concerted action, and not unilateral activity. Id.(citing Copperweld Corp. v. Independence Tube Corp., 467 U.S.
752, 761 (1984)). The Sherman Act proscribes concerted action
because it is “fraught with anticompetitive risk” and “deprives
9
the marketplace of the independent centers of decision-making
that competition assumes and demands.” Robertson, 679 F.3d at
284 (internal citations omitted). The purpose of the
distinction “between concerted and independent action [is] to
deter anticompetitive conduct and compensate its victims,
without chilling vigorous competition through ordinary business
operations.” Id.More particularly, concerted activity is prohibited by
Section 1 when “multiple parties join their resources, rights,
and economic power together in order to achieve an outcome that,
but for concert, would naturally be frustrated by their
competing interests (by way of profit maximizing choices).” Va.
Vermiculite, Ltd. v. Historic Green Springs, Inc., 307 F.3d 277,
282 (4th Cir. 2002). Thus, Section 1 does not include “the
entire body of private contract,” and a business generally has
“the right to deal or not deal with whomever it likes, as long
as it does so independently.” Laurel Sand & Gravel, Inc. v. CSX
Transp., Inc., 924 F.2d 539, 542 (4th Cir. 1991).
To adequately plead a Section 1 conspiracy, the
complaint must allege a factual basis plausibly suggesting that
concerted activity led to an agreement to restrain
trade. See Twombly, 550 U.S. at 556. Specifically, when
concerted conduct is a matter of inference, a plaintiff must
include evidence that places the parallel conduct in “context
10
that raises a suggestion of a preceding agreement” as “distinct
from identical, independent action.” Id. at 549,
556; see also Robertson, 679 F.3d at 289.
“Conspiracies are often tacit or unwritten in an
effort to escape detection, thus necessitating resort to
circumstantial evidence to suggest that an agreement took
place.” Robertson, 679 F.3d at 289-90. There are no
allegations in this case suggestive of such circumstantial
evidence of conspiracy. Rather, Loren Data relies on the
reference in the September 3, 2010 letter to the prohibition on
daisy chaining in the GXS Network interconnect agreements to
meet Section 1’s concerted action requirement. Loren Data reads
the daisy chaining ban contained in the GXS interconnect
agreements as evidence of collusion between GXS and each of the
other 36 Networks to boycott Loren Data.
Merely pleading or pointing to an express contract is
not enough to show that an actual conspiracy to restrain trade
is afoot, however. A reviewing court must “take account of the
absence of a plausible motive to enter into the alleged . . .
conspiracy.” Matsushita Electric Indus. Co., Ltd. v. Zenith
Radio Corp., 475 U.S. 574, 595 (1986). “[C]ourts should not
permit factfinders to infer conspiracies when such inferences
are implausible, because the effect of such practices is often
to deter procompetitive conduct.” Id. at 593 (citing Monsanto
11
Co. v. Spray-Rite Service Corp., 465 U.S. 752, 762-64 (1984).
If the alleged co-conspirators “had no rational economic motive
to conspire, and if their conduct is consistent with other,
equally plausible explanations, the conduct does not give rise
to an inference of conspiracy.” Matsushita, 475 U.S. at 596-97
(citing First Nat’l Bank of Ariz. v. Cities Serv. Co., 391 U.S.
253, 278-80 (1968). The evidence must tend to exclude the
possibility that the alleged co-conspirators acted
independently, and the alleged conspiracy must make practical,
economic sense. Matsushita, 475 U.S. at 597-98
(citing Monsanto, 465 U.S. at 764).
Here, the allegations do not meet this standard. The
September 3, 2010 letter does not provide any indication that
other Networks have acquiesced or joined in any kind of
conspiracy to boycott Loren Data, much less taken any action
against Loren Data. The letter merely suggests that GXS was
unwilling to contract with Loren Data on the terms it sought and
provides no evidence that others agreed to boycott Loren Data.
Indeed, it is difficult, if not impossible, to reconcile Loren
Data’s allegation that the September 3, 2010 letter is direct
evidence of a conspiracy against Loren Data with a full
examination of the terms of that letter. When read in its
entirety, the letter explains that Loren Data’s daisy chain
business model raises service quality concerns for the GXS
12
Network. To address the service quality problems posed by daisy
chaining, GXS proposed a new commercial relationship with Loren
Data. As such, the September 3, 2010 letter is hardly
suggestive of an unlawful conspiracy or an agreement to boycott
Loren Data. Rather, it simply explains the terms on which GXS
was willing to contract with Loren Data.
Moreover, as the district court recognized, the facts
alleged by Loren Data contradict any inference of conspiracy.
Loren Data simultaneously alleges: (1) that GXS contracted with
all other Networks to exclude Loren Data from obtaining a peer
interconnect with GXS; yet (2) Loren Data was able to obtain
peer interconnects with all of these allegedly boycotting
Networks. The fact that Loren Data was able to interconnect
with all of these other Networks negates any suggestion that
these Networks conspired with GXS to boycott Loren Data. These
facts do not support an allegation of a Section 1 conspiracy;
rather, they are consistent with unilateral conduct by GXS to
protect its Network from the service quality perils it perceived
to be associated with daisy chaining.
Given the fact that Loren Data was able to
interconnect freely with so many other Networks, the letter of
September 3, 2010 cannot plausibly be read as evidence of
concerted action. Rather, it reflects GXS’s unilateral business
judgment as to the parameters under which it was willing to deal
13
with Loren Data, an entity it viewed as having an incompatible
business model. Monsanto, 465 U.S. at 761 (“A manufacturer of
course generally has a right to deal, or refuse to deal, with
whomever it likes, as long as it does so independently . . . .
And a distributor is free to acquiesce in the manufacturer's
demand in order to avoid termination.”). Given the facts
alleged in the amended complaint, the conspiracy posited by
Loren Data simply makes no practical or economic sense. As
such, the district court correctly concluded that the Sherman
Act Section 1 claim fails as a matter of law.
V.
Counts II and III of Loren Data’s amended complaint
allege violations of Section 2 of the Sherman Act, 15 U.S.C.
§ 2, which make it illegal to “monopolize, or attempt to
monopolize, or combine or conspire with any other person or
persons, to monopolize any part of the trade or commerce among
the several States, or with foreign nations.” Loren Data
challenges the district court’s decision to dismiss both its
monopolization and attempted monopolization claims.
A.
To state a monopolization claim under Section 2, two
elements must be demonstrated: (1) the possession of monopoly
14
power in the relevant market 3 and (2) the willful acquisition or
maintenance of that power as distinguished from growth or
development as a consequence of a superior product, business
acumen, or historic accident. United States v. Grinnell Corp.,
384 U.S. 563, 570-571 (1966); Verizon Commc’ns Inc. v. Law
Offices of Curtis V. Trinko, LLP, 540 U.S. 398, 407 (2004)
(“Trinko”). The Supreme Court in Trinko noted that the
possession of monopoly power is only unlawful when it is coupled
with anticompetitive conduct. 540 U.S. at 407. To violate
Section 2 of the Sherman Act, a defendant must engage in conduct
“to foreclose competition, gain a competitive advantage, or to
destroy a competitor.” E.I. DuPont de Nemours, 637 F.3d at 450
(citing Eastman Kodak Co. v. Image Technical Servs., Inc., 504
U.S. 451, 482-83 (1992)). The anticompetitive conduct
3
Monopoly power is defined as “the power to control prices
or exclude competition.” United States v. E.I. du Pont de
Nemours & Co., 351 U.S. 377, 391 (1956). “Proof of a relevant
market is the threshold for a Sherman Act § 2 claim. The
plaintiff must establish the geographic and product market that
was monopolized.” Consul, Ltd. v. Transco Energy Co., 805 F.2d
490, 493 (4th Cir. 1986). The district court questioned whether
Loren Data’s “inconclusive statements as to geographic market
are adequate to state a claim,” Loren Data Corp. v. GXS, Inc.,
No. DKC 10-3474, 2011 WL 3511003, at *6 (D. Md. Aug. 9, 2011),
but noted that it need not reach that issue “because Loren
Data’s claim has other failings.” Id. at *7. As to the
relevant product market alleged by Loren Data, the EDI industry,
the district court concluded that “it cannot be said that Loren
Data has failed to plead a relevant product market in terms
sufficient to state a claim.” Id.15
requirement reflects the essence of an antitrust violation, that
of harm to competition, rather than to an individual
competitor. Spanish Broad. Sys. of Fla., Inc. v. Clear Channel
Commc’ns, Inc., 376 F.3d 1065, 1075 (11th Cir. 2004). The
Supreme Court has explained that “[e]ven an act of pure malice
by one business competitor against another does not, without
more, state a claim under the federal antitrust laws.” Brooke
Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209,
225 (1993). “The [Act] directs itself not against conduct which
is competitive, even severely so, but against conduct which
unfairly tends to destroy competition itself.” Spectrum Sports
Inc. v. McQuillan, 506 U.S. 447, 458 (1993). “That is, it must
harm the competitive process and thereby harm consumers. In
contrast, harm to one or more competitors will not
suffice.” United States v. Microsoft Corp., 253 F.3d 34, 70-71
(D.C. Cir. 2001) (en banc) (emphasis in original).
Loren Data alleges that GXS’s anticompetitive behavior
is evidenced by its refusal to provide it a peer interconnect
and this refusal is a denial of access to an essential facility.
i.
The Sherman Act “does not restrict the long recognized
right of [a] trader or manufacturer engaged in an entirely
private business, freely to exercise his own independent
16
discretion as to parties with whom he will deal.” United States
v. Colgate & Co., 250 U.S. 300, 307 (1919). Nevertheless,
“[t]he high value that we have placed on the right to refuse to
deal with other firms does not mean that the right is
unqualified.” Trinko, 540 U.S. at 408 (citing Aspen Skiing Co.
v. Aspen Highlands Skiing Corp., 472 U.S. 585, 601 (1985)).
In Trinko, the Court observed that exceptions to the
right to refuse to deal should be recognized with caution due to
the “uncertain virtue of forced sharing and the difficulty of
indentifying and remedying anticompetitive conduct by a single
firm.” Id. Specifically, the Court noted that Aspen Skiing
represented an exception to this rule and is situated “at or
near the outer boundary of § 2 liability.” Id. The Aspen
Skiing exception applies when “[t]he unilateral termination of a
voluntary (and thus presumably profitable) course of dealing
suggested a willingness to forsake short-term profits to achieve
an anticompetitive end.” Id.
Loren Data’s attempt to analogize this case to Aspen
Skiing is unpersuasive. GXS has not refused to deal with Loren
Data. Indeed, in the September 3, 2010 letter, GXS proposed
terms for a commercial relationship with Loren Data. There is
no suggestion, and the amended complaint does not allege, that
this offer of a new commercial agreement was some sort of sham
17
or that GXS would renege on its proposal; rather, Loren Data was
not satisfied with its terms.
Loren Data counters that a commercial mailbox
arrangement is not a viable alternative to a peer interconnect.
But simply because GXS does not offer Loren Data the terms and
conditions it desires does not mean that GXS has violated the
antitrust laws. Indeed, GXS provides legitimate business
justifications for the terms it offers Loren Data. Cf. Laurel
Sand & Gravel, 924 F.2d at 544 (noting that anticompetitive
exclusionary conduct may be shown if “there was no legitimate
business reason for its conduct.”). Plainly, as GXS explains in
its September 3, 2010 letter, there are ample business
justifications for its decision not to deal with Loren Data on
the terms Loren Data wants.
Nor does the alleged failure of GXS to contract with
Loren Data on those terms work to deprive the market of vigorous
competition. GXS granted peer interconnects to every other
Network, large or small, and the district court correctly
concluded that “GXS is not likely to gain monopoly control over
the industry if it refuses to deal with only one of 36 available
VAN networks.” Loren Data Corp., 2011 WL 3511003, at *11. Not
only does GXS interconnect with the 36 other Networks, Loren
Data was able to do so as well. Further, even though Loren Data
was not able to obtain a peer interconnect with GXS, its
18
allegations acknowledge that more than half of its business
traveled on the GXS Network. Simply put, Loren Data’s
allegations that it is able to access 36 other Networks and that
more than half of its business traversed the GXS Network negates
any plausible inference of anticompetitive exclusionary conduct
by GXS. Loren Data argues that smaller EDI consumers are harmed
by GXS’s exclusionary conduct because accessing the GXS Network
through another Network is more expensive. But Loren Data
offers no facts to support its conclusory assertion that smaller
EDI consumers have been denied access or are otherwise unable to
obtain EDI services because of cost. In short, Loren Data has
failed to allege a plausible claim of exclusionary conduct
directed to competition as a whole.
ii.
Loren Data also alleges that the GXS Network is an
essential facility, the denial of access to which violates
Section 2. The Supreme Court has not adopted the essential
facilities doctrine. Trinko, 540 U.S. at 411 (“We have never
recognized such a doctrine . . . and we find no need either to
recognize it or repudiate it here.”). Nevertheless, we
considered such a claim in Laurel Sand & Gravel. 924 F.2d at
544.
19
Under such a theory, a refusal by a monopolist to deal
“may be unlawful because a monopolist’s control of an essential
facility (sometimes called a ‘bottleneck’) can extend monopoly
power from one stage of production to another, and from one
market into another. Thus, the antitrust laws have imposed on
firms controlling an essential facility the obligation to make
the facility available on non-discriminatory terms.” MCI
Commc’ns Corp. v. Am. Tel. & Tel. Co., 708 F.2d 1081, 1132 (7th
Cir.), cert. denied, 464 U.S. 891 (1983). “[T]he central
concern in an essential facilities claim is whether market power
in one market is being used to create or further a monopoly in
another market.” Advanced Health-Care Servs., Inc. v. Radford
Cmty. Hosp., 910 F.2d 139, 150 (4th Cir. 1990).
In order to proceed on an essential facilities claim,
four elements must be proven: “(1) control by the monopolist of
the essential facility; (2) the inability of the competitor
seeking access to practically or reasonably duplicate the
facility; (3) the denial of the facility to the competitor; and
(4) the feasibility of the monopolist to provide the
facility.” Laurel Sand & Gravel, 924 F.2d at 544 (citing MCI
Commc’ns Corp., 708 F.2d at 1132). The owner of an essential
facility is not obligated to make it available under whatever
terms the competitor wishes; the owner need only offer access
under reasonable terms. Id. Moreover, terms are not
20
unreasonable simply because they will reduce a competitor's
profits. Id.
The amended complaint does not sufficiently allege
that GXS is an essential facility. First, Loren Data cannot
plausibly maintain that a peer interconnect with GXS is
essential. Although Loren Data complains that GXS has
repeatedly denied it a peer interconnect, it alleges that more
than half of its EDI business travels over the GXS Network.
Moreover, Loren Data has established peer interconnects with
three dozen other Networks. The fact that the majority of Loren
Data’s business traversed the GXS Network without a peer
interconnect demonstrates the fallacy of the claim that a peer
interconnect is essential to competition. Second, there is no
indication that the new commercial agreement offered to Loren
Data by GXS in the September 3, 2010 letter is an unreasonable
alternative to the terms Loren Data seeks. Loren Data’s history
with Covisint further illustrates this point. Covisint required
Loren Data to have access to the GXS Network as part of its
prospective contract agreement. Even though Loren Data was able
to connect to the GXS Network only through a commercial mailbox,
Covisint still decided to contract with Loren Data. While a
peer interconnect with GXS may suit Loren Data better, it is
plainly not essential.
21
At its core, Loren Data’s amended complaint does not
plausibly allege the denial of access to an essential facility.
Loren Data has functioned for a decade without unfettered peer
interconnect access to the GXS Network it now claims is
essential. Even were access to the GXS Network essential for
Loren Data to compete, GXS offered Loren Data access to its
Network on terms acceptable to GXS as set forth in the September
3, 2010 letter. For both of these reasons, this case does not
present a plausible essential facilities claim.
B.
Loren Data also argues that the district court erred
in dismissing its attempted monopolization claim. To state a
claim for attempted monopolization, a plaintiff must
demonstrate: (1) a specific intent to monopolize the relevant
market; (2) predatory or anticompetitive acts in furtherance of
the intent; and (3) a dangerous probability of
success. Spectrum Sports, Inc., 506 U.S. at 456. The district
court held that Loren Data failed to allege facts demonstrating
a specific intent to monopolize or a dangerous probability that
GXS would succeed in establishing a monopoly. We agree.
Loren Data has not sufficiently alleged that GXS had a
specific intent to monopolize. Indeed, Loren Data alleges just
the opposite - that GXS grants peer interconnects to every other
22
Network, both large and small – which is entirely inconsistent
with an intent to monopolize. Nor does Loren Data allege a
dangerous probability of successful monopolization by GXS.
Loren Data characterizes two acquisitions by GXS over a ten year
period as an aggressive campaign to monopolize. Loren Data
cites M & M Medical Supplies & Service, Inc. v. Pleasant Valley
Hospital, Inc., 981 F.2d 160, 168 (4th Cir. 1992), for the
proposition that a rising market share is sufficient to show a
dangerous probability of achieving monopoly power. However,
in M & M Medical, we held that “[o]ther factors must be
considered, such as ease of entry, which heralds slight chance
of success [of achieving monopoly power], or exclusionary
conduct without the justification of efficiency, which enhances
the likelihood of success [of achieving monopoly power].” Id.Loren Data’s complaint and amended complaint are devoid of any
factual allegation suggesting that GXS’s rising market share was
coupled with any exclusionary conduct. Inconsistent with Loren
Data’s theory is its allegation that GXS established peer
interconnects with 36 other Networks, conduct which is hardly
suggestive of an attempt to monopolize the EDI market. In sum,
the fact that GXS has contracted with every other Network in the
market suggests that its refusal to deal with Loren Data on the
terms Loren Data desires will not have any negative effects on
competition as a whole.
23
VI.
Finally, Loren Data argues that the district court
erred in denying its post-judgment motions. Loren Data filed a
“motion for clarification” asking the district court to issue a
revised or supplemental order stating whether its claims were
dismissed with or without prejudice. Before this motion was
ruled on, Loren Data filed another motion asking the district
court to reconsider its order granting GXS’s motion to dismiss.
The district court construed both of these motions as motions to
alter judgment pursuant to Federal Rule of Civil Procedure
59(e).
The reconsideration of a judgment after its entry is
an extraordinary remedy which should be used sparingly. Pac.
Ins. Co. v. Am. Nat’l Ins. Co., 148 F.3d 396 (4th Cir. 1998).
We review the denial of a Rule 59(e) motion under the
deferential abuse of discretion standard. Ingle ex rel. Estate
of Ingle v. Yelton, 439 F.3d 191, 197 (4th Cir. 2006). Rule
59(e) provides that a court may alter or amend the judgment if
the movant shows (1) an intervening change in the controlling
law, (2) new evidence that was not available at trial, or
(3) that there has been a clear error of law or a manifest
injustice. Id.; see e.g., Robinson v. Wix Filtration Corp. LLC,
599 F.3d 403 (4th Cir. 2010). It is the moving party’s burden
24
to establish one of these three grounds in order to obtain
relief under Rule 59(e).
The district court did not abuse its discretion in
denying Loren Data’s motions. As there was no suggestion of a
change in intervening law or new facts, Loren Data was left to
argue that a clear error of law or manifest injustice occurred.
As the foregoing analysis of Loren Data’s claims makes plain,
the dismissal of Loren Data’s antitrust claims was neither. Nor
was it a clear error of law for the district court to dismiss
the case without first making a specific finding that an
additional opportunity to amend the complaint would be futile.
In ruling on the post-judgment motions, the district court made
it abundantly clear that any amendment to the complaint would be
futile for two reasons. First, Loren Data had already amended
the complaint once before, suggesting that further amendment
would be futile. Second, Loren Data provided nothing of
additional substance to the district court to demonstrate that a
dismissal without prejudice would be fruitful. Plainly, the
district court did not abuse its discretion in denying Loren
Data’s post-judgment motions.
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VII.
For these reasons, the judgment of the district court
is affirmed.
AFFIRMED
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