A la Carte Class Action Suit Gets Fresh Legs

The Ninth Circuit Court of Appeals has withdrawn a three-judge panel decision last June affirming a lower court's ruling that a group of cable and satellite subs did not have a case when they alleged that bundled cable programming was an antitrust violation.

The class action suit had been filed against NBCU, Viacom, Disney, Fox, Time Warner, Time Warner Cable, Comacst, DirecTV, Echostar and Cablevision, among others. The subscribers claimed that bundling of high-value channels with lower-valued ones reduces consumer choice and raises prices, precluding distributors from offering a la carte and constituting a restraint of trade in violation of the Sherman Antitrust Act. In June, the three-judge panel had upheld a district court ruling throwing out the antitrust suit, saying that it was "a consumer protection class action masquerading as an antitrust suit.... In the absence of any allegation of injury to competition as opposed to injuries to consumers," wrote Judge Sandra Ikuta, "we conclude that plaintiffs have failed to state a claim for an antitrust violation." But in a one-paragraph order Oct. 31, the court withdrew the decision and said it was going to reconstitute a panel, making moot requests to rehear the case.