Cablevision Systems Corp. is claiming that Viacom Inc. violated antitrust laws by threatening it with a $1 billion penalty if it refused to carry low-rated Viacom channels after obtaining access to Viacom’s more popular channels, such as MTV, Comedy Central and Nickelodeon.

Cablevision made the claim of strong-arm tactics last week, as it publicly revealed that it had filed an antitrust complaint against Viacom in the U.S. District Court for the Southern District of New York, alleging violations of Section 1 of the Sherman Act and of New York’s Donnelly Act.

The crux of the case is Cablevision’s claim that Viacom illegally tied several of its lesser-viewed networks to networks over which it allegedly possesses and exercises market power.  Cablevision’s complaint alleges that Viacom exercises market power through MTV, Comedy Central, Nickelodeon and BET (the “Tying Networks”).

The complaint alleges that a December 2012 agreement between the parties forced Cablevision to distribute Viacom’s entire suite of channels in return for gaining the right to carry the Tying Networks.  According to Cablevision, failure to carry the less popular networks would have resulted in Viacom imposing $1 billion in penalties on Cablevision.

Cablevision claims that Viacom’s forcing of Cablevision to distribute Viacom’s lesser-valued networks has foreclosed competitive programmers from getting access to Cablevision’s “pipes.”  According to Cablevision, it has scarce capacity to distribute programming and only limited dollars to spend on acquiring programming for viewers.

The complaint alleges that each of the Tying Networks is a relevant market.  Cablevision alleges that even if the relevant programming markets are defined more broadly (e.g., a market for “popular children’s programming”), each of these networks still wields market power.  But the complaint also alleges that Cablevision, itself, competes against various distributors of programming, including distributors that reach end viewers over the Internet.

Cablevision seeks treble damages for this alleged tying.  However, it would not be surprising if Cablevision eventually drops the suit for more advantageous carriage terms.

Notably, Cablevision states in the complaint that it bundles programming to end viewers in tiers, arguably acknowledging that certain bundles of programming may be procompetitive.

The United Kingdom is considering moving closer to the American class action system and several other reforms that would strengthen antitrust enforcement.

Under a plan announced by the U.K.’s Department for Business Innovation and Skills (the “BIS”), the U.K. would adopt an opt-out collective action system – similar to the American class action system – in an effort to make it easier for consumers and small businesses to obtain damages in price-fixing cases.

The BIS announcement stated that the government has decided to: (1) establish the Competition Appeal Tribunal (CAT) as the major venue for competition actions in the U.K.; (2) introduce a limited opt-out collective actions regime, with safeguards, for competition law; and (3) promote alternative dispute resolution as an alternative to court action.  Much of the proposal would require new legislation.

The British Courts would face significant changes under the plan.  Currently, private cases are heard by an inundated High Court making private litigation lengthy and expensive.  Between 2005 and 2008 judgment was reached in only 41 competition cases.

Under the proposed new system, the CAT would hear all private disputes.  The CAT would also continue to hear appeals of public investigations decided by the Office of Fair Trade.

“Since its creation, the CAT has built up its expertise in competition cases and has become familiar with competition litigation.  There is now a substantial body of CAT case law on many aspects of substance and procedure in this field.  The concept of a specialist competition tribunal or court is recognized internationally as a key strength of the UK regime,” the BIS stated.

Such use of the CAT would also enable a fast-track process to be created to encourage small and medium sized companies to bring cases.

The BIS recommended instating “opt-out” collective action in order to ensure that businesses or consumers affected by an anticompetitive action would receive redress unless they specifically opted out of such relief.

Pro-business interest groups have criticized the plan.  “The Government has let the litigation genie out of the bottle by adopting US-style collective actions.  By grouping potential claimants together indiscriminately these ‘opt-out’ actions fail the growth test and will fuel a litigation culture in the UK,” said Katja Hall, Chief Policy Director for the Confederation of British Industry.

Despite signifying a major change from current U.K. policy on class actions, the new system would maintain significant differences from the American system.  For example, the new British system would not adopt jury trials, treble damages, or contingency fees.  Collective action cases would only be permitted in competition litigation.

Three of the world’s largest potash miners have agreed to settle two multidistrict class action antitrust cases that accuse them of collectively reducing supply in order to inflate prices.

The settling defendants, Potash Corp. of Saskatchewan Inc., Minnesota-based Mosaic Co. and Calgary-based Agrium Inc., have agreed to pay $80 million to plaintiffs that directly purchased potash, a key agricultural fertilizer, which farmers use to enhance crop yields and fight crop diseases. 

Businesses and individuals that rely on fertilizers indirectly affected by the increase in potash prices filed a separate complaint.  The settling defendants have agreed to pay $17.5 million to settle the indirect purchaser claims. 

The direct purchasers’ complaint in In re Potash Antitrust Litigation, in the U.S. District Court for the Northern District of Illinois, accuses eight Russian, Canadian, and American companies of using trade association meetings and an executive “exchange” program to collectively decrease the supply of potash.

According to that complaint, in one example of coordinated action, defendant JSC Silvinit announced a sinkhole would force them to halt excavation.  Four of the other defendants then suspended their sales, citing Silvinit’s sinkhole as the reason.

Plaintiffs argue that the suspension of sales suggests a cartel existed.  “Had the market truly been competitive, defendants would have the incentive to increase, not suspend, production to take advantage of their competitor’s reduced output,” the complaint stated.

According to plaintiffs, from 2003 and 2008 these halts in production were used to increase prices from $150 per ton to $1,000 per ton.

The non-settling defendants have a petition for writ of certiorari pending with the Supreme Court that seeks to resurrect a motion to dismiss the case under the Foreign Trade Antitrust Improvements Act (“FTAIA”), which bars claims involving foreign trade or commerce that does not sufficiently affect U.S. commerce.

Although the district court rejected the FTAIA argument, the U.S. Court of Appeals for the Seventh Circuit initially reversed the district court and dismissed the case.  However, an en banc panel of the appeals court reversed its earlier ruling and reinstated the claims against the defendants.