Andrea Resnick v. Netflix, Inc.

These consolidated antitrust actions arise out of an agreement (“Promotion Agreement”) between Netflix and Wal-mart whereby Walmart transferred its online DVD-rental subscribers to Netflix, and Netflix agreed to promote Walmart’s DVD sales business. The plaintiffs, individuals representing a class of Netflix subscribers (“Subscribers”), contend that this arrangement violated §§ 1 and 2 of the Sherman Act by illegally allocating and monopolizing the online DVD-rental market. The Subscribers’ theory of injury is that they paid supracompetitive prices for one of Netflix’s subscription plans because Netflix would have reduced the price of that plan but for its allegedly anticompeti-tive conduct.

We agree with the district court that the Subscribers have not raised a triable issue of fact as to whether they suffered antitrust injury-in-fact, and we affirm the district court’s grant of summary judgment. We vacate in part the district court’s cost award, and remand for consideration in light of this opinion.

I

In 1997, Reed Hastings and Marc Randolph co-founded Netflix, the first internet-based DVD rental service. Netflix commenced operations in 1998, offering customers…