CarGurus, Inc. v. Trader Corporation - Reasons for Order and Order dismissing an application for leave

CarGurus, Inc. v. Trader Corporation - Reasons for Order and Order dismissing an application for leave

The Tribunal dismissed the leave application because CarGurus failed to adduce sufficient credible, non-speculative evidence to give rise to a bona fide belief that it was directly and substantially affected (required for s.75 and s.77) and failed to establish key elements of s.76 (insufficient evidence of a low pricing policy, insufficient evidence the refusal was principally motivated by price, and insufficient evidence of an adverse effect on competition). Key deficiencies were unreliable market share evidence, unsupported revenue projections, actual revenue growth undermining claimed harm, and the presence of copyright litigation and legitimate business reasons for refusal.

Citation
2016 Comp Trib 15
Parties
Applicant: CarGurus, Inc.; Respondent: Trader Corporation
Court
Competition Tribunal
Jurisdiction
Canada
Judgment Date
14 October 2016
Procedural Posture
Leave to Make Application Under the Competition Act (sections 75, 76, 77) / Decision on Application for Leave (dismissal)
Outcome
Application for leave under sections 75, 76 and 77 dismissed; costs awarded to respondent
Legal Topics
Refusal to Deal, Price Maintenance, Exclusive Dealing, Leave to Apply Under S.103.1, Market Definition and Market Power, Causation of Anticompetitive Conduct
Source Language
English
Competition Law Administrative Law Intellectual Property Law Refusal to Deal Price Maintenance Exclusive Dealing Leave to Apply Under S.103.1 Market Definition and Market Power +1 more

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Parties

CarGurus, Inc.

Applicant

Trader Corporation

Respondent

Procedural Posture

Leave to Make Application Under the Competition Act (sections 75, 76, 77) / Decision on Application for Leave (dismissal)

Legal Issues

  1. 1 Whether applicant was directly and substantially affected by respondent’s conduct for leave under s.103.1(7)
  2. 2 Whether elements of s.75 (refusal to deal) and s.77 (exclusive dealing) could be met
  3. 3 Whether elements of s.76 (price maintenance) could be met, including existence of a ‘low pricing policy’ and causation

Ratio Decidendi

The Tribunal dismissed the leave application because CarGurus failed to adduce sufficient credible, non-speculative evidence to give rise to a bona fide belief that it was directly and substantially affected (required for s.75 and s.77) and failed to establish key elements of s.76 (insufficient evidence of a low pricing policy, insufficient evidence the refusal was principally motivated by price, and insufficient evidence of an adverse effect on competition). Key deficiencies were unreliable market share evidence, unsupported revenue projections, actual revenue growth undermining claimed harm, and the presence of copyright litigation and legitimate business reasons for refusal.

Court Disposition

Application for leave under sections 75, 76 and 77 dismissed; costs awarded to respondent

Orders

  • The application seeking leave for relief under sections 75, 76 and 77 of the Competition Act is dismissed.
  • Respondent Trader Corporation awarded costs against applicant CarGurus, Inc. assessed at the mid-point of Column III of the table to Tariff B of the Federal Courts Rules, SOR/98-106.