Companies and trade associations involved in setting industry standards should take note of a recent decision out of the Eastern District of Virginia this month.
In SD3, LLC v. Black & Decker, Inc. et al, a federal judge dismissed an antitrust suit alleging a conspiracy in the power tool industry to prevent adoption of table saw safety technology. The suit, brought by SD3, maker of the SawStop technology which prevents table saw injuries, after unsuccessful licensing negotiations with the defendant power tool companies, alleged a “group boycott” on the part of the companies, claiming that the tool companies conspired not to license the company’s technology. SD3 also claimed that the companies attempted to prevent the technology from becoming an industry standard.
The tool companies filed motions to dismiss, and the judge recently dismissed the suit, finding that SD3 had not alleged sufficient proof of a group boycott or any harm to competition. First, the judge noted that many of the tool companies had continued to negotiate with SD3 after the alleged boycott began. In addition, the court found the “standards conspiracy” allegations insufficient, noting that “neither mere participation in a standards-setting body nor mere membership in a trade association is sufficient to state an antitrust conspiracy claim” and that merely declining to impose the technology on the market “did not exclude ‘SawStop’ technology from the market in any way.”
The court’s dismissal is relevant for companies and associations considering industry or product safety standards.