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Federal Judge Green Lights Antitrust Attack Of The Cloned Horses

Posted  June 11, 2013

Breeders of cloned horses will get to advance their antitrust attack on a dominant horse breed registry that excludes cloned horses, following a ruling by a federal judge in Texas who denied American Quarter Horse Association’s motion for summary judgment.

District Court Judge Mary Lou Robinson of the U.S. District Court for the Northern District of Texas ruled in Abraham & Veneklasen Joint Venture et al. v. American Quarter Horse Association that plaintiffs, who breed elite horses through a cloning technique, presented enough evidence to defeat summary judgment on their claims of antitrust conspiracy and monopolization.

Defendant, the American Quarter Horse Association, is a non-profit, membership organization that maintains a breed registry of competitive horses.  Without admission to the AQHA registry, a horse is barred from participation in the most lucrative competitions and races.

According to the complaint, members of the Stud Book Registration Committee, who are themselves breeders, created a rule banning any cloned horses from the registry.  The AQHA argued that it neither conspired nor created a monopoly with the rule.

“Even if the Board did not relegate control to the Committee on cloning matters, it did not review or question the Committee’s unanimous recommendations,” Judge Robinson stated in her opinion. “Thus, there is evidence that the AQHA is the conspiracy, because it is in fact controlled by competitors with interests to ban clones.”

In order to uphold the monopolization claim, plaintiffs needed to present evidence indicating that AQHA maintains monopoly power.  The court held that “a factfinder could determine that the AQHA has monopoly power over the economically viable Quarter Horse market because its rules control not only market participation but whether, in turn, a horse is valuable or relatively worthless.”

The court, however, did grant AQHQ summary judgment on plaintiffs’ attempted monopolization claim because plaintiffs alleged only that AQHA succeeded in obtaining monopoly power, not that it almost obtained monopoly power.

Tagged in: Antitrust Litigation, Monopolization,