Commercial Division Blog
Court Declines to Dismiss Donnelly Act Claims
On March 31, 2015, Justice Friedman of the New York County Commercial Division issued a decision in Williams v. Barclays Capital, Inc., 2015 NY Slip Op. 30466(U), refusing to dismiss a Donnelly Act claim.
In Williams, the plaintiff alleged that the defendant "engaged in a conspiracy with investment banks and others not to" use the plaintiff's "patented airline special facility (ASF) municipal bond structure to finance airline terminal construction." The defendant moved to dismiss. The court declined to dismiss the plaintiff's Donnelly Act claim, explaining:
The purpose of the Donnelly Act, New York's antitrust statute, is to prevent anti-competitive practices. . . . [T]he Donnelly Act, having been modeled on the Federal Sherman Act of 1890, should generally be construed in light of Federal precedent and given a different interpretation only where State policy, differences in the statutory language or the legislative history justify such a result.
[The Donnelly Act] provides, in relevant part, that every contract, agreement, arrangement or combination whereby competition or the free exercise of any activity in the conduct of any business, trade or commerce or in the furnishing of any service in this state is or may be restrained is hereby declared to be against public policy, illegal and void. To state a claim under this section, a plaintiff must allege both concerted action by two or more entities and a consequent restraint of trade within an identified relevant product market. A restraint-of-trade Donnelly Act violation can only occur when the alleged conspirators are in competition with one another or with the plaintiff.
(Internal quotations and citations omitted) (emphasis added). As to the defendant's contention that the plaintiff's claims should be dismissed for failure to "plead particularized facts regarding the alleged conspiracy," the court held that the plaintiff had adequately done so.