Ninth Circuit Affirms Netflix Victory in Antitrust Class Action

On February 27, 2015, the firm secured a significant court victory for client Netflix, the world's leading Internet television network. The Ninth Circuit Court of Appeals affirmed a decision by the U.S. District Court for the Northern District of California, which granted summary judgment to Netflix, dismissing a federal court lawsuit brought against the company by a class of subscribers that had accused Netflix of conspiring with Wal-Mart to restrain competition in online DVD-rental services. Wilson Sonsini Goodrich & Rosati represented Netflix in connection with the matter before both the Ninth Circuit and the Northern District of California.

The class action lawsuit arose out of a promotion agreement in which Walmart offered its online DVD rental subscribers the opportunity to switch to Netflix, and Netflix agreed to promote Walmart's DVD sales business. The plaintiff class asserted that the arrangement violated federal antitrust laws by allocating and monopolizing the online DVD-rental market.

Writing on behalf of the Ninth Circuit, Chief Judge Sidney R. Thomas said the court agreed with the district court "that the subscribers have not raised a triable issue of fact as to whether they suffered antitrust injury-in-fact on a theory that they paid supracompetitive prices for one of Netflix's subscription plans [on the theory that] Netflix would have reduced the price of that plan but for its allegedly anticompetitive conduct."

In 2012, the firm received the "Behavioral Matter of the Year – Americas" award from Global Competition Review for its successful defense of Netflix in In re Online DVD Rental Antitrust Litigation before the Northern District of California.

The Wilson Sonsini Goodrich & Rosati team representing Netflix in the matter included partners Jonathan Jacobson, Scott Sher, Dylan Liddiard, Tony Weibell, Keith Eggleton, and Maura Rees; associates Jeff Bank, David Reichenberg, Tiffany Lee, and Dan Weick; and paralegal coordinator Anthony Geritano.

Please view the Ninth Circuit's opinion for more information.