Purchasers of pay-per-use (PPU) text messaging services have asked the U.S. Supreme Court to review a decision of the U.S. Court of Appeals in Chicago, rejecting their price fixing claims against the nation’s four largest telecommunications carriers. In their petition for certiorari, the complaining purchasers urge the High Court to resolve a split among the circuit courts on the proper approach to direct evidence of an antitrust conspiracy on a motion for summary judgment (Aircraft Check Services Co. v. Verizon Wireless, Dkt. 15-519).

The petitioners are businesses and individuals who brought price fixing claims on behalf of a class of purchasers of PPU text messaging services, as distinguished from the now-ubiquitous bundled text messaging plans, from the carriers—AT&T, Verizon, Sprint, and T-Mobile. The purchasers alleged that the carriers agreed to identical, parallel price increases to $0.10, then $0.15, and finally $0.20, for incoming and outgoing PPU messages between 2005 and 2008. The carriers had suggested that the price hikes for PPU services were undertaken to encourage these customers to switch to bundle plans. The district court granted summary judgment in favor of the defendants, and the Seventh Circuit affirmed.

The petitioners contend that the appellate court did not properly consider their direct evidence of a price fixing conspiracy. The direct evidence was in the form of an admission of collusion by a T-Mobile executive in e-mails to another T-Mobile executive. However, the appellate court determined that the direct evidence was inconclusive and it refused to draw inferences from the admission in the petitioners’ favor.

Also at issue is the Seventh Circuit’s decision not to allow a jury to consider the destruction of evidence as evidence of a conspiracy. The T-Mobile executives involved in the challenged e-mail purportedly agreed to destroy earlier messages in the e-mail chain. That evidence was never discovered. The appellate court held that the petitioners had not established bad faith and inferred that the destruction was motivated by the executive’s fear of adverse career consequences. According to the petitioners, there is a split among the circuits on whether bad faith and judicial factual findings are required before a jury may determine whether to draw an adverse inference from the destruction of evidence.

In their petition, the PPU purchasers ask: (1) whether the summary judgment standard articulated in Matsushita Electric Industrial Co., Ltd., v. Zenith Radio Corp., 475 U.S. 574, 1986-1 Trade Cases ¶67,004, applies when plaintiffs offer direct evidence of conspiracy; (2) whether a finding of bad faith is required before a trier of fact may draw an inference from the destruction of evidence; and (3) whether a trier of fact may draw an adverse inference from the destruction of evidence only if the trial court first makes the factual findings that authorize such an inference.

Attorneys: Steven F. Hubacheck (Robbins Geller Rudman & Dowd LLP) for Aircraft Check Services Co.

Companies: Aircraft Check Services Co.; Verizon Wireless; T-Mobile USA, Inc.; Sprint Nextel Corp.; AT&T Mobility, LLC; Sprint Communications, Inc.