Comcast Motion To Dismiss Altitude Sports & Entertainment Lawsuit

Case 1:19-cv-03253-WJM-MEH Document 30 Filed 01/14/20 USDC Colorado Page 1 of 23
IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO
Civil Action No. 1:19-cv-03253-WJM-MEH
ALTITUDE SPORTS & ENTERTAINMENT, LLC,
Plaintiff,
v.
COMCAST CORPORATION and

COMCAST CABLE COMMUNICATIONS, LLC,
Defendants.
COMCAST’S MOTION TO DISMISS ALTITUDE’S COMPLAINT

TABLE OF CONTENTS
PAGE
TABLE OF AUTHORITIES ......................................................................................................... ii
CERTIFICATE OF CONFERRAL ................................................................................................ 1
PRELIMINARY STATEMENT .................................................................................................... 1
ALTITUDE’S ALLEGATIONS ................................................................................................... 2
ARGUMENT .................................................................................................................................. 4
I. THE COMPLAINT AT MOST PLEADS A LAWFUL UNILATERAL

REFUSAL TO DEAL ON ALTITUDE’S PREFERRED TERMS ................................. 5
A. Comcast Did Not Refuse to Deal with Altitude ..................................................... 6
B. Altitude Fails to Plead the Elements of a Refusal to Deal Claim ........................... 6
C. No Other Antitrust Theories Are Availing to Altitude ........................................... 8
D. Federal Regulatory Oversight Reinforces the Bases for Dismissal ........................ 9
II. THE COMPLAINT ALSO FAILS TO PLEAD MONOPOLY POWER OR A

DANGEROUS PROBABILITY OF ACHIEVING MONOPOLY POWER ................ 10
A. Comcast Is Not a Purchaser with Monopsony Power, as a Matter of Law ......... 10
B. There Is No “Dangerous Probability” that Comcast Will

Gain Monopoly Power in the Denver Sports Rights Market ................................ 11
III. THE COMPLAINT PLEADS NO INJURY TO COMPETITION ............................... 13
IV. THE TORT CLAIMS SHOULD BE DISMISSED ........................................................ 14
A. Federal Law Preempts Altitude’s Tort Claims .................................................... 14
B. The Complaint Fails to Plead a Tortious Interference Claim ............................... 15
CONCLUSION ............................................................................................................................ 15
TABLE OF AUTHORITIES
CASES
PAGE(S)
Aspen Skiing Co. v. Aspen Highlands Skiing Corp.,
472 U.S. 585 (1985) ................................................................................................................. 7
Atl. Richfield Co. v. USA Petroleum Co.,
495 U.S. 328 (1990) ........................................................................................................... 4, 13
B-S Steel of Kan. Inc. v. Tex. Indus., Inc.
439 F.3d 653 (10th Cir. 2006) ................................................................................................. 13
Bell Atl. Corp. v. Twombly,
550 U.S. 544 (2007) ................................................................................................................. 4
Bell v. Dow Chem. Co.,
847 F.2d 1179 (5th Cir. 1988) ................................................................................................... 8
Bristow Endeavor Healthcare, LLC v. Blue Cross & Shield Ass’n,
2016 WL 3199520 (N.D. Okla. June 8, 2016),
aff’d, 691 F. App’x 515 (10th Cir. 2017) ................................................................................. 7
Buccaneer Energy (USA) Inc. v. Gunnison Energy Corp.,
846 F.3d 1297 (10th Cir. 2017) ............................................................................................... 10
Campfield v. State Farm Mut. Auto. Ins. Co.,
532 F.3d 1111 (10th Cir. 2008) ............................................................................................... 15
Caven v. Am. Fed. Sav. & Loan Ass’n of Colo.,
837 F.2d 427 (10th Cir. 1988) ................................................................................................. 15
City of Chanute, Kan. v. Williams Nat. Gas Co.,
955 F.2d 641 (10th Cir. 1992) ................................................................................................... 9
Christy Sports, LLC v. Deer Valley Resort Co., Ltd.,
555 F.3d 1188 (10th Cir. 2009) ....................................................................................... passim
Colo. Interstate Gas Co. v. Nat. Gas Pipeline Co. of Am.,
885 F.2d 683 (10th Cir. 1989) ........................................................................................... 10, 12
Columbia River People’s Util. Dist. v. Portland Gen. Elec. Co.,
217 F.3d 1187 (9th Cir. 2000) ................................................................................................. 14
Comcast Cable Commc’ns, LLC v. FCC,
717 F.3d 982 (D.C. Cir. 2013) .................................................................................................. 9
ii
Crocs, Inc. v. Effervescent, Inc.,

248 F. Supp. 3d 1040 (D. Colo. 2017) ................................................................................... 15
Four Corners Nephrology Assocs., P.C. v. Mercy Med. Ctr. of Durango,
582 F.3d 1216 (10th Cir. 2009) ............................................................................................. 5, 8
FTC v. Phoebe Putney Health Sys., Inc.,
568 U.S. 216 (2013) ............................................................................................................... 14
Geier v. Am. Honda Motor Co.,
529 U.S. 861 (2000) ............................................................................................................... 14
Glaser v. Jordan,
2010 WL 1268151 (D. Colo. Mar. 30, 2010) .......................................................................... 15
Glen Eden Hosp., Inc. v. Blue Cross & Blue Shield of Mich., Inc.,
740 F.2d 423 (6th Cir. 1984) .................................................................................................... 7
Horst v. Laidlaw Waste Sys., Inc.,
917 F. Supp. 739 (D. Colo. 1996) .......................................................................................... 12
JTS Choice Enters., Inc. v. E.I. DuPont de Nemours & Co.,
2014 WL 793525 (D. Colo. Feb. 26, 2014) .............................................................................. 4
Koch v. City of Del City,
660 F.3d 1228 (10th Cir. 2011) ............................................................................................... 15
Loren Data Corp. v. GXS, Inc.,
501 F. App’x 275 (4th Cir. 2012) ........................................................................................... 13
McKenzie v. Mercy Hosp. of Indep., Kan.,
854 F.2d 365 (10th Cir. 1988) ................................................................................................... 9
Nobody in Particular Presents, Inc. v. Clear Channel Commc’ns, Inc.,
311 F. Supp. 2d 1048 (D. Colo. 2004) ................................................................................... 11
Novell, Inc. v. Microsoft Corp.,
731 F.3d 1064 (10th Cir. 2013) ....................................................................................... passim
Pac. Bell Tel. Co. v. Linkline Commc’ns, Inc.,
555 U.S. 438 (2009) ............................................................................................................. 5, 6
Reazin v. Blue Cross & Blue Shield of Kan., Inc.,
899 F.2d 951 (10th Cir. 1990) ................................................................................................. 10
Robbins v. Oklahoma,
519 F.3d 1242 (10th Cir. 2008) ............................................................................................. 2, 4
iii
Shell v. Am. Family Rights Ass’n,

899 F. Supp. 2d 1035 (D. Colo. 2012) ................................................................................... 15
SolidFX, LLC v. Jeppesen Sanderson, Inc.,
841 F.3d 827 (10th Cir. 2016) ............................................................................................... 5, 6
SolidFX, LLC v. Jeppesen Sanderson, Inc.,
935 F. Supp. 2d 1069 (D. Colo. 2013) ................................................................................. 5, 8
TKO Energy Servs., LLC v. M-I LLC,
539 F. App’x 866, 872 (10th Cir. 2013) ................................................................................. 12
Turner Broad. Sys., Inc. v. FCC,
512 U.S. 622 (1994) ............................................................................................................... 14
TV Commc’ns Network, Inc. v. ESPN, Inc.,
767 F. Supp. 1062 (D. Colo. 1991),
aff’d, 964 F.2d 1022 (10th Cir. 1992) ..................................................................................... 10
Verizon Commc’ns, Inc. v. Law Offices of Curtis V. Trinko, LLP,
540 U.S. 398 (2004) ....................................................................................................... passim
W. Penn Allegheny Health Sys., Inc. v. UPMC,
627 F.3d 85 (3d Cir. 2010) ....................................................................................................... 5
Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co.,
549 U.S. 312 (2007) ........................................................................................................... 9, 10
Williamson v. Mazda Motor of Am., Inc.,
562 U.S. 323 (2011) ............................................................................................................... 14
STATUTES & RULES

47 U.S.C. § 536 .............................................................................................................................. 9
Telecommunications Act of 1996, 110 Stat. 143, § 601(b)(1)
(codified at 47 U.S.C. § 152, note) ........................................................................................... 14
C.R.S. § 13-21-102(1.5)(a) ........................................................................................................... 15

Fed. R. Civ. P. 8 ........................................................................................................................... 15
Fed. R. Civ. P. 12(b)(6) .................................................................................................................. 1
iv
OTHER AUTHORITIES
3B Areeda & Hovenkamp, Antitrust Law (4th ed. 2015)
¶ 772d3 …. .......................................................................................................................... 9
¶ 772d4 …. .......................................................................................................................... 6
In re Implem’n of §§ 12 & 19 of the Cable Television Consumer Prot. & Comp’n Act of 1992,
Second Report & Order, 9 FCC Rcd. 2642 (1993) .................................................................. 14
v
Defendants Comcast Corporation and Comcast Cable Communications, LLC (together,
“Comcast”) move pursuant to Fed. R. Civ. P. 12(b)(6) to dismiss the complaint filed by plaintiff
Altitude Sports & Entertainment, LLC (“Altitude”). Comcast requests oral argument.
CERTIFICATE OF CONFERRAL
Pursuant to WJM Practice Standard III.D.1, undersigned counsel certifies that the parties
conferred telephonically as to this motion, including whether Altitude could cure the complaint’s
deficiencies by amendment, on January 10, 2020, after Comcast provided a written summary of
the grounds of the motion on January 6, 2020. Altitude opposes the relief sought in this motion.
PRELIMINARY STATEMENT
This case arises from a routine commercial dispute between a regional sports network
(Altitude) and a video programming distributor (Comcast). Altitude wanted Comcast to
distribute the network to most of Comcast’s customers in the Denver area, whereas Comcast
only wanted to provide it to customers who demand sports content. Altitude and Comcast also
disagreed about the right price for Altitude’s programming. The parties could not reach a deal,
and Comcast’s license to distribute Altitude expired. Now, in a transparent maneuver to gain
negotiating leverage, Altitude attempts to convert this dispute into an antitrust case. But the
complaint comes nowhere close to stating a valid antitrust or tort claim and should be dismissed.
First, the antitrust claims fail because they rest, at most, upon allegations of a lawful
unilateral refusal to deal. A unilateral refusal to deal is “presumptive[ly]” legal and “almost
never harm[s] consumers.” Novell, Inc. v. Microsoft Corp., 731 F.3d 1064, 1073 (10th Cir.
2013) (Gorsuch, J.). Thus, a plaintiff asserting such a claim must thread “the narrow-eyed
needle of refusal to deal doctrine.” Id. at 1074. The complaint pleads none of the elements of a
refusal to deal claim, and instead establishes the legality of Comcast’s conduct by pleading facts
showing that Comcast acted with the legitimate business objective of achieving cost savings.
Second, the complaint pleads facts conclusively establishing that Comcast is not a
monopolist (or “monopsonist”) in any relevant market. Comcast allegedly accounts for only
57% of video subscribers in the Denver area, far short of the minimum 70% to 80% necessary
for monopoly power under Tenth Circuit precedent. Nor can the complaint establish that
Comcast is attempting to monopolize a distinct market for regional sports rights, because
Comcast’s current share of that market is zero, and there are no allegations showing that another
large regional sports network (“RSN”) in Denver (AT&T) will exit the market.
Third, Altitude fails to plead the requisite harm to competition. Altitude does not plead
facts showing that Comcast’s loss of Altitude’s programming has caused or will cause Comcast
to acquire or maintain “monopsony” power as a purchaser of content in Denver. Nor does
Altitude allege facts establishing that there will be harm to competition in the alleged sports
rights market. Instead, the complaint only speculates that Comcast could replace Altitude in that
market—a mere substitution that might harm Altitude but would not harm competition.
Finally, the state law tortious interference claims also fail as a matter of law. Federal law
preempts those claims and Altitude also fails adequately to plead those claims.
ALTITUDE’S ALLEGATIONS1
Altitude is a Denver RSN. Compl. ¶ 24. Altitude owns the rights to telecast games for
the Colorado Avalanche (NHL), Denver Nuggets (NBA), Colorado Mammoth (lacrosse), and
1
Comcast assumes, as it must, that Altitude’s well-pleaded allegations of fact are true,
solely for purposes of this motion to dismiss. See Robbins v. Oklahoma, 519 F.3d 1242, 1247
(10th Cir. 2008).
2
Colorado Rapids (soccer). Id. ¶ 5. Both Altitude and these sports franchises are under the same
ownership. Id. ¶ 54. AT&T SportsNet, another RSN, also operates in Denver. Id. ¶ 41. The
alleged relevant market for the sale of regional sports rights to RSNs in the Denver area is the
“Regional Sports Production Market” (id. ¶¶ 2, 68, 75)—the “Sports Rights Market” for short.
In this market, Altitude is a buyer of sports rights, and Comcast does not participate.
RSNs like Altitude sell programming to distributors such as cable, satellite, telco, and
Internet television providers. Id. ¶ 31. Distributors typically pay a monthly fee for each
subscriber who receives the programming. Id. ¶ 32. The alleged relevant market for RSN
programming in the Denver area is the “Regional Sports Programming Market” (id. ¶¶ 75, 78)—
the “Programming Market” for short. Altitude is a seller in this market and Comcast is a buyer.
Altitude alleges that Comcast has a 57% market share among Denver distributors. Id. ¶ 70.
For fifteen years, Comcast distributed Altitude’s programming to most of its customers in
the Denver area. Id. ¶ 84. In 2004, the parties signed a ten-year contract requiring Comcast to
distribute Altitude to at least 70% of its Denver subscribers at rising per-subscriber rates.
Id. ¶¶ 92-93. In 2014, the parties renewed the contract for five years at higher rates. Id.
¶¶ 94-95. The renewed contract expired by its own terms on August 31, 2019. Id. ¶ 96.
As the expiration date neared, Altitude made two renewal offers, which included a
minimum requirement that Comcast distribute the RSN to most of its subscribers. Id.
¶¶ 101-104. Comcast countered with a three-year deal, without minimum distribution
requirements, at a flat monthly fee, instead of a per-subscriber fee, with annual increases. Id.
¶¶ 105-106. Altitude refused the counteroffer, and no agreement was reached before the contract
expired, causing Altitude to “black out” its programming on Comcast. Id. ¶¶ 107-113, 124-125.
3
Altitude acknowledges Comcast’s view that Altitude’s current fee is “too expensive.” Id.
¶ 152. Altitude alleges that because Comcast no longer pays that fee, its programming costs
have “dropped dramatically,” and that Comcast has increased its “profit” by not fully passing on
those cost savings to customers. Id. ¶¶ 19, 33, 158-159, 176. Meanwhile, DIRECTV, Spectrum,
and CenturyLink continue to distribute Altitude to their Denver customers. Id. ¶¶ 125-126.
ARGUMENT
The Court should dismiss a complaint where, as here, the plaintiff fails to plead “enough
facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S.
544, 570 (2007); Robbins, 519 F.3d at 1247.
Altitude’s complaint asserts claims for unlawful monopolization and attempted
monopolization under Section 2 of the Sherman Act and Colorado’s analogous antitrust statute.
These claims are facially deficient because the complaint fails plausibly to plead
(1) anticompetitive conduct, (2) power in a relevant market, or (3) antitrust injury. In particular:
(1) the challenged conduct—Comcast’s decision not to accede to Altitude’s negotiation

demands—is, at most, a lawful unilateral refusal to deal, see Christy Sports, LLC v.
Deer Valley Resort Co., Ltd., 555 F.3d 1188, 1192 (10th Cir. 2009);
(2) Altitude has not pleaded that Comcast has monopoly power in either the
Programming Market (where Comcast has only a 57% share as a purchaser) or the
Sports Rights Market (where Comcast does not compete at all), see id.; and
(3) Altitude fails to plead antitrust injury because it merely alleges harm to itself rather
than the requisite harm to competition, see Atl. Richfield Co. v. USA Petroleum Co.,
495 U.S. 328, 344 (1990).2
Altitude’s tortious interference claims also fail for multiple reasons discussed below.
2
Altitude’s antitrust claims under Colorado law should be dismissed for the same reasons
as the Sherman Act claims. See JTS Choice Enters., Inc. v. E.I. DuPont de Nemours & Co.,
2014 WL 793525, at *4 n.3 (D. Colo. Feb. 26, 2014) (Martínez, J.).
4
I. THE COMPLAINT AT MOST PLEADS A LAWFUL UNILATERAL

REFUSAL TO DEAL ON ALTITUDE’S PREFERRED TERMS
The complaint fails to plead any “element of anticompetitive conduct,” as it must.
Verizon Commc’ns Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398, 407 (2004). It
alleges that Comcast demanded lower prices for Altitude’s programming and other terms
Altitude did not accept. Such alleged hard bargaining is, however, “not only not unlawful; it is
an important element of the free-market system.” Id.; see also W. Penn Allegheny Health Sys.,
Inc. v. UPMC, 627 F.3d 85, 103 (3d Cir. 2010) (a firm with “substantial power . . . is generally
free to bargain aggressively when negotiating the prices it will pay”).
At most, the complaint pleads that Comcast unilaterally refused Altitude’s offers. But
“[t]ypically, unilateral refusals to deal are lawful.” SolidFX, LLC v. Jeppesen Sanderson, Inc.,
935 F. Supp. 2d 1069, 1082 (D. Colo. 2013) (Martínez, J.), aff’d in relevant part, 841 F.3d 827
(10th Cir. 2016). With only “rare” exceptions, long-established antitrust law holds that firms are
“free to choose the parties with whom they will deal, as well as the prices, terms, and conditions
of that dealing.” Pac. Bell Tel. Co. v. Linkline Commc’ns, Inc., 555 U.S. 438, 448 (2009). Even
a “putative monopolist” retains that freedom. Four Corners Nephrology Assocs., P.C. v. Mercy
Med. Ctr. of Durango, 582 F.3d 1216, 1221 (10th Cir. 2009) (Gorsuch, J.).
The antitrust laws strongly disfavor forced dealing for good reasons. Requiring a firm to
share its competitive advantage discourages investment and innovation. Trinko, 540 U.S. at
407-08. Coerced dealing also requires courts to act as “central planners, identifying the proper
price, quantity, and other terms of dealing—a role for which they are ill suited.” Id. at 408.
Forced dealing with a non-competitor is particularly ill-suited to antitrust remedies because
“[w]hen a monopolist does not itself operate in vertically related or collateral markets, it has no
5
incentive to restrain competition there.” 3B Areeda & Hovenkamp, Antitrust Law ¶ 772d4, at
290 (4th ed. 2015) (“Areeda”). Thus, a firm that decides not to deal with a supplier “will usually
have a legitimate business reason,” and if its decision proves “unwise,” it will “tend to be self-
correcting.” Id. Accordingly, the proponent of a duty to deal claim must thread “the narrow-
eyed needle of refusal to deal doctrine.” Novell, 731 F.3d at 1074. Altitude fails to do this.
A. Comcast Did Not Refuse to Deal with Altitude
Altitude undermines its refusal to deal theory by conceding that Comcast was willing to
continue to distribute its programming, but not on Altitude’s desired terms. Compl. ¶¶ 105-107.
Altitude claims that Comcast’s terms were not “reasonable” because they were not “similar” to
the expired contract. Id. ¶¶ 108, 112. But a disagreement over suitable commercial terms is not
an actionable refusal to deal. Altitude’s argument illustrates precisely why duty to deal claims
are so highly disfavored: Courts are “ill-suited” to assess the reasonableness of offered terms,
including a “proper price.” Trinko, 540 U.S. at 408; see also Linkline, 555 U.S. at 454 (“[H]ow
is a judge or jury to determine a ‘fair price’?”) (quotations omitted). These concerns led the
Supreme Court to reject a duty to deal in Trinko. This Court should do so here.
B. Altitude Fails to Plead the Elements of a Refusal to Deal Claim
A refusal to deal claim requires allegations showing that a monopolist (1) discontinued a
preexisting, voluntary, and profitable course of dealing with a rival; (2) suffered a short-term
profit sacrifice as a result; and (3) acted in a manner that was “irrational but for its
anticompetitive effect.” Novell, 731 F.3d at 1074-75; SolidFX, 841 F.3d at 843. Altitude’s own
allegations negate each of these essential elements.
6
First, Altitude has not alleged prior dealings between “a monopolist and rival,” as
required to apply the “limited exception” to the rule against a duty to deal. Novell, 731 F.3d at
1074 (discussing Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585 (1985)). As
shown below, Altitude’s allegations establish that Comcast is neither a monopsonist nor a
competitor of Altitude. See infra Point II. Instead, Comcast was a customer of Altitude. This
relationship dooms Altitude’s claim because “mere refusal to deal with one who is not a
competitor does not constitute an antitrust violation.” Glen Eden Hosp., Inc. v. Blue Cross &
Blue Shield of Mich., Inc., 740 F.2d 423, 430 (6th Cir. 1984); see, e.g., Novell, 731 F.3d at 1074;
Bristow Endeavor Healthcare, LLC v. Blue Cross & Blue Shield Ass’n, 2016 WL 3199520, at
*8 n.9 (N.D. Okla. June 8, 2016), aff’d, 691 F. App’x 515 (10th Cir. 2017).
Second, the complaint does not plead that Comcast lost any short-term profits, as a duty
to deal claim requires. Novell, 731 F.3d at 1075. To the contrary, Altitude alleges that this
dispute concerns “how much money Comcast will pocket for itself” now that its programming
expenses have “dropped dramatically” because it no longer pays for Altitude. Compl. ¶¶ 33, 84.
Further, the complaint expressly alleges that to increase its “profit,” Comcast did not pass along
its cost savings to customers. Id. ¶¶ 158-159, 176, 184. The complaint suggests that Comcast
may have lost some subscribers and advertising revenues, but it does not allege facts showing
losses that offset Comcast’s “dramatic[]” cost savings. This is also fatal to Altitude’s claim. See
Christy Sports, 555 F.3d at 1197 (duty to deal claim failed on the pleadings where allegations
showed that the defendant “expect[ed] to increase (not forsake) short-term profits”).
Third and relatedly, Altitude does not plead conduct by Comcast that was “irrational but
for its tendency to harm competition.” Novell, 731 F.3d at 1076. Altitude cannot, because it
7
does not allege facts showing harm to competition. See infra Point III. Instead, Altitude
affirmatively pleads Comcast’s procompetitive motive: cost savings. Compl. ¶ 33; see, e.g.,
Bell v. Dow Chem. Co., 847 F.2d 1179, 1185 (5th Cir. 1988). This rational business justification
requires the rejection of a duty to deal as a matter of law. See, e.g., SolidFX, 935 F. Supp. 2d at
1082 (“Even if a company has an ongoing relationship with a competitor and later changes
course, so long as a business proffers some business reason for its decision, such decision is not
precluded by the Sherman Act.”).
Finally, it is significant that the parties’ contract expired by its own terms. Compl. ¶ 96.
Through this litigation, Altitude seeks to compel Comcast to carry it in perpetuity on terms
“similar” to a contract from 2004. But the antitrust laws do not require indefinite dealing, much
less on particular terms. This is especially true here, as Comcast expressly limited its dealings
with Altitude by negotiating for an expiration date with no renewal right. Where, as here, a firm
“preserve[d] its future flexibility” by contract, it “should not be forever locked into a business
decision made” years ago. Christy Sports, 555 F.3d at 1198.
C. No Other Antitrust Theories Are Availing to Altitude
Having failed to plead an unlawful refusal to deal, Altitude cannot pivot to any other
theory of the essential element of “anticompetitive conduct.” Trinko, 540 U.S. at 407. Any
theory that Comcast will “leverage” its purported monopsony in the Programming Market into
the Sports Rights Market cannot independently support liability. See Four Corners, 582 F.3d at
1222 (“Where, as here, the only possible candidate for anticompetitive conduct could be ‘the
refusal-to-deal claim we have rejected,’ denominating one’s claim as sounding in ‘monopoly
leveraging’ won’t do anything to save it.”) (quoting Trinko, 540 U.S. at 415 n.4).
8
Any so-called “essential facilities” claim would also fail. That doctrine was disowned by
the Supreme Court in Trinko, a decision it likely did not survive, and has been widely criticized.
See Trinko, 540 U.S. at 410-11; Novell, 731 F.3d at 1074; 3B Areeda ¶ 772d3, at 235. In any
event, Altitude fails to plead a claim under that discredited doctrine. Such a claim required a
monopolist to control a facility “essential” to a competitor, McKenzie v. Mercy Hosp. of Indep.,
Kan., 854 F.2d 365, 369 (10th Cir. 1988), such that “an alternative to the facility [was] not
feasible,” City of Chanute, Kan. v. Williams Nat. Gas Co., 955 F.2d 641, 648 (10th Cir. 1992)
(quotation omitted). Comcast is not a monopolist. See infra Point II. Altitude continues to
distribute its programming widely in the Denver area, including through numerous distributors
such as DIRECTV, Spectrum, and CenturyLink. Compl. ¶¶ 125-126. And because Comcast and
Altitude “occupy different market levels in the chain of distribution of programming,” Comcast
cannot have “denied an essential facility to a competitor.” TV Commc’ns Network, Inc. v. ESPN,
Inc., 767 F. Supp. 1062, 1072 (D. Colo. 1991), aff’d, 964 F.2d 1022 (10th Cir. 1992).3
D. Federal Regulatory Oversight Reinforces the Bases for Dismissal
The Supreme Court has emphasized that antitrust analysis must be attuned to “the
existence of a regulatory structure designed to deter and remedy anticompetitive harm.” Trinko,
540 U.S. at 412. Here, federal “program carriage” law, implemented by the FCC, governs
disputes between a distributor such as Comcast and a programmer such as Altitude. See 47
U.S.C. § 536; Compl. ¶ 49. This regulatory structure applies “traditional antitrust principles”
that “gover[n] unreasonable restraints.” Comcast Cable Commc’ns, LLC v. FCC, 717 F.3d 982,
989-90 (D.C. Cir. 2013) (Kavanaugh, J., concurring).

3
Altitude refers to “predatory demands” (Compl. ¶ 8), but does not allege any predatory
bidding. See Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., 549 U.S. 312 (2007).
9
Where, as here, a regulatory “regime [is] an effective steward of the antitrust function,”
“the additional benefit to competition provided by antitrust enforcement will tend to be small,
and it will be less plausible that the antitrust laws contemplate . . . additional scrutiny.” Trinko,
540 U.S. at 412-13. Here, as in Trinko, FCC oversight reinforces the grounds for dismissal.
II. THE COMPLAINT ALSO FAILS TO PLEAD MONOPOLY POWER OR A

DANGEROUS PROBABILITY OF ACHIEVING MONOPOLY POWER
Unlawful monopolization and attempted monopolization claims require, respectively, the
defendant’s “possession of monopoly power in a relevant market” or a “dangerous probability”
of achieving such power. Christy Sports, 555 F.3d at 1192. The complaint pleads neither.
A. Comcast Is Not a Purchaser with Monopsony Power, as a Matter of Law
Comcast allegedly has a 57% market share as a buyer in the Programming Market.
Compl. ¶ 70.4 Altitude argues that Comcast’s market share makes it a “monopsonist”—i.e., a
purchaser with monopoly power. Id. ¶¶ 8, 78-79, 173. “[S]imilar legal standards should apply to
claims of monopolization and to claims of monopsonization.” Weyerhaeuser, 549 U.S. at 320;
see also Buccaneer Energy (USA) Inc. v. Gunnison Energy Corp., 846 F.3d 1297, 1315 (10th
Cir. 2017) (“The same general framework for assessing market power applies to monopsony and
monopoly situations alike.”).
Altitude has failed, as a matter of law, to plead that Comcast has monopoly power, which
generally requires “a minimum market share of between 70% and 80%.” Colo. Interstate Gas
Co. v. Nat. Gas Pipeline Co. of Am., 885 F.2d 683, 694 n.18 (10th Cir. 1989) (citation omitted);
see also Reazin v. Blue Cross & Blue Shield of Kan., Inc., 899 F.2d 951, 969-70 (10th Cir. 1990)
(presumption against monopoly power for 47% to 62% market share). This Court has held, for
4
Cable is not a posited relevant market, so Comcast’s cable share (id. ¶ 2) is irrelevant.
10
example, that a 50.48% market share “is not monopolistic.” Nobody in Particular Presents, Inc.
v. Clear Channel Commc’ns, Inc., 311 F. Supp. 2d 1048, 1098 (D. Colo. 2004). Comcast’s
alleged market share thus falls far short of monopsony.
The complaint’s other allegations undermine Altitude’s argument that Comcast is a
monopsonist. Contrary to its conclusory assertion that Comcast is a “gatekeeper” to consumers
(Compl. ¶ 72), the complaint acknowledges that consumers can choose among television
providers, such as by switching from cable to a satellite service like DIRECTV. Id. ¶¶ 70, 126.
The complaint also alleges that cable customers are increasingly “cutting the cord”—canceling
their television subscriptions in favor of online video streaming—and that Altitude’s
unavailability on Comcast will likely increase that cord cutting by Comcast customers. Id.
¶¶ 145-151. This further refutes any suggestion that Comcast has monopsony power. By
Altitude’s concession, there are more alternative buyers of its video programming than ever.5
B. There Is No “Dangerous Probability” that Comcast Will

Gain Monopoly Power in the Denver Sports Rights Market
The complaint claims that, by not agreeing to Altitude’s preferred carriage terms,
Comcast is “attempting to acquire monopoly power” in the Sports Rights Market, which is
defined to cover only the Denver area. Compl. ¶¶ 68, 180. Altitude speculates that Comcast
wants to drive Altitude out of business to acquire its sports rights, even though Altitude and the
sports teams from which Comcast would have to obtain those rights have the same owner. Id.
¶ 54. The notion that Altitude’s owner would facilitate Comcast’s launching of an RSN, much
less that Comcast is a “rapid entrant” (id. ¶¶ 11, 46), is implausible.
5
To the extent that Altitude contends that Comcast is a monopsonist buyer of hockey
programming (see Compl. ¶ 82), that contention fails as a matter of law for the same reasons.
11
Altitude’s allegations also negate the requisite “dangerous probability” that Comcast will
achieve monopoly status in the Sports Rights Market for three additional reasons.
First, even if Comcast were to replace Altitude, it would not be a monopolist. Other
RSNs, including AT&T SportsNet, operate in the Denver area. Id. ¶ 41. The complaint fails to
show how Comcast could monopolize the Denver Sports Rights Market in that manner because it
does not plead any RSN market shares or any other facts showing that Altitude now has a
monopoly. See TKO Energy Servs., LLC v. M-I LLC, 539 F. App’x 866, 872 (10th Cir. 2013).
Second, “[t]he likelihood of successful monopolization is typically evaluated by
examining the defendant’s share of the relevant market.” Colo. Interstate, 885 F.2d at 694.
Here, Comcast’s market share of the Denver Sports Rights Market is zero—Comcast has not
operated an RSN in Denver since it exited the market in 2012. Compl. ¶¶ 39, 41, 46. This long-
ago drop in Comcast’s market share to zero is fatal to the attempted monopolization claims. See
Horst v. Laidlaw Waste Sys., Inc., 917 F. Supp. 739, 745 (D. Colo. 1996).
In an attempt at misdirection, Altitude alleges that Comcast holds national rights to
certain hockey games from all NHL teams, and argues that gives Comcast a position in an
alleged hockey submarket. Compl. ¶¶ 62, 75-77. Yet Altitude elsewhere defines the geographic
market as limited to Denver (id. ¶ 68), and concedes that national and regional rights are
“separate categor[ies] of programming for purposes of market definition.” Id. ¶ 73. In Denver,
Altitude holds rights to the “vast majority” of Avalanche games. Id. ¶ 38. Altitude alleges no
share for Comcast in the Denver Sports Rights Market, and there is no basis to conclude that
Comcast’s national rights to a few Avalanche games gives it a material share of any alleged
relevant market.
12
Third, other allegations negate any probability that Comcast will monopolize the Sports
Rights Market. Altitude pleads no facts showing that Comcast plans to reenter that market, and
instead alleges that Comcast launched or acquired RSNs elsewhere, 13 to 23 years ago. Id. ¶ 58.
Altitude also cites Comcast’s unsuccessful bids for Time Warner and Fox, which owned RSNs
outside Denver among many other assets. Id. ¶¶ 59-60. But none of those allegations plausibly
shows that Comcast plans to operate a Denver RSN. Cf. Loren Data Corp. v. GXS, Inc., 501 F.
App’x 275, 285 (4th Cir. 2012) (two acquisitions in ten years was not campaign to monopolize).
III. THE COMPLAINT PLEADS NO INJURY TO COMPETITION
An antitrust plaintiff must plead injury “from a competition-reducing aspect or effect of
the defendant’s behavior.” Atl. Richfield, 495 U.S. at 344 (emphasis in original). This ensures
that antitrust claims arise only from “injury of the type the antitrust laws were designed to
prevent,” and not from losses that “stem from competition.” B-S Steel of Kan., Inc. v. Tex.
Indus., Inc., 439 F.3d 653, 667 (10th Cir. 2006) (quotation omitted). Altitude pleads facts that
preclude any finding of antitrust injury.
First, Altitude’s conclusory contention that Comcast “willfully seeks to maintain [its]
monopsony power” by ceasing to distribute Altitude (Compl. ¶ 173), makes no sense. Comcast’s
decision did nothing to maintain its alleged 57% market share. To the contrary, Altitude alleges
that without its content, Comcast is losing customers and losing market share. Id. ¶¶ 147-151.
Second, the complaint alleges no facts showing harm to competition in the Sports Rights
Market. Altitude speculates that Comcast seeks “to acquire monopoly power” by “replac[ing]
Altitude.” Id. ¶¶ 180, 182. If Comcast were to replace Altitude, market concentration would not
change. At most, there would be harm to Altitude, not harm to competition. “[S]ubstitution of
13
one monopolist for another is not an antitrust violation.” FTC v. Phoebe Putney Health Sys.,
Inc., 568 U.S. 216, 232 (2013) (quotation omitted); see Columbia River People’s Util. Dist. v.
Portland Gen. Elec. Co., 217 F.3d 1187, 1190 (9th Cir. 2000) (“[I]f the plaintiff’s only claim is
of the nature ‘I, rather than the defendant, was entitled to be the monopolist of this market,’ then
the plaintiff is not a victim of antitrust injury.”) (quotation omitted).6
IV. THE TORT CLAIMS SHOULD BE DISMISSED
A. Federal Law Preempts Altitude’s Tort Claims
The relevant federal regulatory regime, see supra Point I.D, requires the FCC to “strike a
balance” between barring “unfair and anticompetitive” actions by distributors and preserving
“legitimate, aggressive negotiations.”7 This regime would be frustrated if state tort law could
strike a different balance between “unfair and anticompetitive” tactics and “legitimate”
negotiations. Moreover, Colorado’s common law of tortious interference takes no account of the
“significant objective[s]” balanced by the FCC, rendering it incompatible with the statutory
regime. Williamson v. Mazda Motor of Am., Inc., 562 U.S. 323, 330 (2011). Under these
circumstances, Altitude’s claims for tortious interference with contractual relations and with
prospective business relations are preempted. See Geier v. Am. Honda Motor Co., 529 U.S. 861,
886 (2000). This conclusion is reinforced by the program access statute’s “savings clause” that
preserved only existing antitrust law, and left state tort law subject to preemption.
Telecommunications Act of 1996, 110 Stat. 143, § 601(b)(1) (codified at 47 U.S.C. § 152, note).
6
Altitude’s damages and injunction claims also fail because they seek to impose liability
based upon Comcast’s exercise of editorial discretion protected by the First Amendment. See
Turner Broad. Sys., Inc. v. FCC, 512 U.S. 622, 636 (1994).
7
In re Implem’n of §§ 12 & 19 of the Cable Television Consumer Prot. & Comp’n Act of
1992, Second Report & Order, 9 FCC Rcd. 2642, 2648 ¶¶ 14-15 (1993) (quotations omitted).
14
B. The Complaint Fails to Plead a Tortious Interference Claim
In any event, the complaint fails as a matter of law to plead plausible tortious interference
claims, for two principal reasons. First, those claims are based on the same conduct that, as
demonstrated, is proper under the antitrust laws. The sole “interference” attributed to Comcast is
its refusal to renew its own contract with Altitude, a “legitimate business activity” that “does not
rely on improper methods” and is not tortious. Campfield v. State Farm Mut. Auto. Ins. Co., 532
F.3d 1111, 1123 (10th Cir. 2008). That the contract expired by its own terms (Compl. ¶ 96) also
gave Comcast an “absolute right” to let it expire, barring a tortious interference claim as a matter
of law. Caven v. Am. Fed. Sav. & Loan Ass’n of Colo., 837 F.2d 427, 432 (10th Cir. 1988).
Second, Altitude’s conclusory recital of the elements of the claims (see Compl. ¶¶ 17,
164, 203-206, 209-212) is inadequate under Rule 8. See Shell v. Am. Family Rights Ass’n, 899
F. Supp. 2d 1035, 1060 (D. Colo. 2012) (dismissing “conclusory” tortious interference claim).
Altitude does not identify a single agreement with any sports team or advertiser that has been
breached or not performed, let alone allege facts showing that Comcast induced such breach or
nonperformance. Nor does Altitude allege any specific prospective business relationship with
which Comcast interfered. See Crocs, Inc. v. Effervescent, Inc., 248 F. Supp. 3d 1040, 1060
(D. Colo. 2017). These omissions are independently fatal to the tortious interference claims.
CONCLUSION
For the foregoing reasons, Altitude’s complaint should be dismissed with prejudice.8
8
If the Court dismisses the antitrust claims, it should decline supplemental jurisdiction
over the tort claims. See Koch v. City of Del City, 660 F.3d 1228, 1248 (10th Cir. 2011). If any
state law claims survive, however, the Court should dismiss or strike Altitude’s demand for
punitive damages because Colorado law prohibits such a demand in the initial pleading. C.R.S.
§ 13-21-102(1.5)(a); Glaser v. Jordan, 2010 WL 1268151, at *2 (D. Colo. Mar. 30, 2010).
15
Dated: January 14, 2020 Respectfully submitted,
s/ Kathryn A. Reilly
Kathryn A. Reilly
Ryan W. Cooke
WHEELER TRIGG O’DONNELL LLP
370 Seventeenth Street, Suite 4500
Denver, CO 80202-5647
Telephone: 303.244.1800
Facsimile: 303.244.1879
Email: reilly@wtotrial.com
cooke@wtotrial.com
Arthur J. Burke
David B. Toscano
Christopher Lynch
John M. Briggs
DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
New York, New York 10017
Telephone: 212.450.4000
Facsimile: 212.701.5800
Email: arthur.burke@davispolk.com
david.toscano@davispolk.com
christopher.lynch@davispolk.com
john.briggs@davispolk.com
Attorneys for Defendants Comcast Corporation

and Comcast Cable Communications, LLC
16
CERTIFICATE OF SERVICE (CM/ECF)
I HEREBY CERTIFY that on January 14, 2020, I electronically filed the foregoing
COMCAST’S MOTION TO DISMISS ALTITUDE’S COMPLAINT with the Clerk of
Court using the CM/ECF system, which will send notification of such filing to all counsel of
record.
s/ Kathryn A. Reilly

Comcast Motion To Dismiss Altitude Sports & Entertainment Lawsuit

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Case 1:19-cv-03253-WJM-MEH Document 30 Filed 01/14/20 USDC Colorado Page 1 of 23

IN THE UNITED STATES DISTRICT COURT

Civil Action No. 1:19-cv-03253-WJM-MEH

ALTITUDE SPORTS & ENTERTAINMENT, LLC,

COMCAST CORPORATION and

COMCAST’S MOTION TO DISMISS ALTITUDE’S COMPLAINT

TABLE OF AUTHORITIES ......................................................................................................... ii

CERTIFICATE OF CONFERRAL ................................................................................................ 1

PRELIMINARY STATEMENT .................................................................................................... 1

ALTITUDE’S ALLEGATIONS ................................................................................................... 2

I. THE COMPLAINT AT MOST PLEADS A LAWFUL UNILATERAL

A. Comcast Did Not Refuse to Deal with Altitude ..................................................... 6

B. Altitude Fails to Plead the Elements of a Refusal to Deal Claim ........................... 6

C. No Other Antitrust Theories Are Availing to Altitude ........................................... 8

D. Federal Regulatory Oversight Reinforces the Bases for Dismissal ........................ 9

II. THE COMPLAINT ALSO FAILS TO PLEAD MONOPOLY POWER OR A

A. Comcast Is Not a Purchaser with Monopsony Power, as a Matter of Law ......... 10

B. There Is No “Dangerous Probability” that Comcast Will

III. THE COMPLAINT PLEADS NO INJURY TO COMPETITION ............................... 13

IV. THE TORT CLAIMS SHOULD BE DISMISSED ........................................................ 14

A. Federal Law Preempts Altitude’s Tort Claims .................................................... 14

B. The Complaint Fails to Plead a Tortious Interference Claim ............................... 15

Crocs, Inc. v. Effervescent, Inc.,

Shell v. Am. Family Rights Ass’n,

STATUTES & RULES

C.R.S. § 13-21-102(1.5)(a) ........................................................................................................... 15

Defendants Comcast Corporation and Comcast Cable Communications, LLC (together,

(Altitude) and a video programming distributor (Comcast). Altitude wanted Comcast to

to acquire or maintain “monopsony” power as a purchaser of content in Denver. Nor does

¶¶ 101-104. Comcast countered with a three-year deal, without minimum distribution

544, 570 (2007); Robbins, 519 F.3d at 1247.

Altitude’s complaint asserts claims for unlawful monopolization and attempted

(1) the challenged conduct—Comcast’s decision not to accede to Altitude’s negotiation

I. THE COMPLAINT AT MOST PLEADS A LAWFUL UNILATERAL

The complaint fails to plead any “element of anticompetitive conduct,” as it must.

free to bargain aggressively when negotiating the prices it will pay”).

Forced dealing with a non-competitor is particularly ill-suited to antitrust remedies because

A. Comcast Did Not Refuse to Deal with Altitude

B. Altitude Fails to Plead the Elements of a Refusal to Deal Claim

allegations negate each of these essential elements.

precluded by the Sherman Act.”).

decision made” years ago. Christy Sports, 555 F.3d at 1198.

C. No Other Antitrust Theories Are Availing to Altitude

refusal-to-deal claim we have rejected,’ denominating one’s claim as sounding in ‘monopoly

monopolist to control a facility “essential” to a competitor, McKenzie v. Mercy Hosp. of Indep.,

D. Federal Regulatory Oversight Reinforces the Bases for Dismissal

989-90 (D.C. Cir. 2013) (Kavanaugh, J., concurring).

II. THE COMPLAINT ALSO FAILS TO PLEAD MONOPOLY POWER OR A

Unlawful monopolization and attempted monopolization claims require, respectively, the

defendant’s “possession of monopoly power in a relevant market” or a “dangerous probability”

A. Comcast Is Not a Purchaser with Monopsony Power, as a Matter of Law

claims of monopolization and to claims of monopsonization.” Weyerhaeuser, 549 U.S. at 320;

monopoly situations alike.”).

alleged market share thus falls far short of monopsony.

The complaint’s other allegations undermine Altitude’s argument that Comcast is a

monopsonist. Contrary to its conclusory assertion that Comcast is a “gatekeeper” to consumers

their television subscriptions in favor of online video streaming—and that Altitude’s

B. There Is No “Dangerous Probability” that Comcast Will

less that Comcast is a “rapid entrant” (id. ¶¶ 11, 46), is implausible.

Second, “[t]he likelihood of successful monopolization is typically evaluated by

In an attempt at misdirection, Altitude alleges that Comcast holds national rights to

III. THE COMPLAINT PLEADS NO INJURY TO COMPETITION

An antitrust plaintiff must plead injury “from a competition-reducing aspect or effect of