Namm

Opinion by Judge BEA; Dissent by Judge PREGERSON.

OPINION

Where a large musical-instrument retailer pressures individual guitar manufacturers to set the lowest prices at which the manufacturers will permit any retailer to advertise the manufacturers’ products— and each manufacturer acquiesces — can we infer the manufacturers conspired among themselves to fix prices?

Plaintiffs ask us to answer this question in the affirmative. They claim it is plausible to infer a price-fixing conspiracy based only on allegations that certain guitar manufacturers each adopted similar advertising policies (“parallel conduct”) under circumstances that suggest the manufacturers agreed among themselves to adopt those policies (“plus factors”). But plaintiffs’ plus factors are no more consistent with an illegal agreement than with rational and competitive business strategies, independently adopted by firms acting within an interdependent market. Plaintiffs’ allegations of “merely parallel conduct that could just as well be independent action” are insufficient to state a claim under § 1 of the Sherman Act, 15 U.S.C. § 1 . Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 557 , 127 S.Ct. 1955 , 167…

dissenting:

I respectfully dissent. Bell Atlantic Corp. v. Twombly requires plaintiffs in an antitrust action to plead “enough factual matter (taken as true) to suggest that an agreement was made.” 550 U.S. 544, 556 , 127 S.Ct. 1955 , 167 L.Ed.2d 929 (2007) (emphasis added). In the “hub-and-spoke” conspiracy alleged here, plaintiffs pleaded enough factual matter (taken as true) to suggest that a horizontal agreement existed between defendants Fender Musical Instruments Corp.; Gibson Guitar Corp.; Hoshino U.S.A., Inc.; Kaman Music Corp.; and Yamaha Corporation of America (“manufacturer defendants”).

Plaintiffs point to six different “plus factors” to support their claim of an agreement among the manufacturer defendants: (1) the manufacturer defendants- shared a common motive to conspire; (2) the manufacturer defendants acted against then-own individual self-interest; (3) the manufacturer defendants adopted substantially similar Minimum Advertised Price (“MAP”) policies; (4) the Federal Trade Commission (“FTC”) investigation of the National Association of Music Merchants, Inc. (“NAMM”) for price fixing; (5) the manufacturer defendants participated in NAMM functions; and (6) the…

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

IN RE: MUSICAL INSTRUMENTS AND No. 12-56674

EQUIPMENT ANTITRUST LITIGATION,

D.C. No. 3:09-md-02121-

JOSHUA RAMSEY; DAVID LAB-DHB

GIAMBUSSO; DWAYNE WIGGINS;

JASON PARADISE; KATE

MACWILLIAMSON; NIRANJAN OPINION

PARIKH; PAULA JENNINGS; RYAN J.

BIGG; MARK O’LEARY; CYNTHIA

SEPULVEDA; RUSSELL D. MELTON;

JERRY JOST; KEVIN GAGNEPAIN;

JOSH PEARSON; JOHN PEARSON;

MARY PEARSON; COLBY GILES;

DAVID KEEL; WILLIAM S. POFF;

ALLEN HALE; DANIEL T. SMITH;

GERALD LOGSDON; AUGUSTIN

CERVANTES; BENN FELTHEIMER;

BRYAN ROACH; BRANDON

ARMSTRONG; RICHARD TABAS;

ALLEN HALE; KENNETH MANYIN;

RUSSELL D. MELTON; JON BANDISH;

MARK O’LEARY; ALEX TELLER;

SCOTT COOK; JOSHUA SEILER;

JOHAN EDWARD RIGOR; WALTER

WITHERSPOON; ROBERT LESKO;

SUZANNE ONDRE; LISA PRITCHETT,

Plaintiffs-Appellants, IN RE: MUSICAL INSTRUMENTS

v.

NATIONAL ASSOCIATION OF MUSIC

MERCHANTS, INC.; GUITAR CENTER,

INC.; GUITAR CENTER STORES, INC.;

FENDER MUSICAL INSTRUMENTS

CORP.; YAMAHA CORPORATION OF

AMERICA; GIBSON GUITAR

CORPORATION; HOSHINO, U.S.A.,

INC.; KAMAN MUSIC…