## Facts

- Conwood and USTC competed in the U.S. moist snuff market; Conwood held about 13.5% share and USTC about 77%.
- Conwood alleged USTC used its dominance to block rivals’ access to retail points of sale, especially counter racks and shelf space.
- Evidence showed USTC’s sales force removed or destroyed competitors’ display racks and point-of-sale materials and obscured rivals’ products.
- Conwood presented evidence that USTC pushed “category management” arrangements with retailers and used that role to favor USTC products and limit rivals’ shelf presence.
- Conwood claimed these practices reduced its visibility and availability at retail and caused lost sales and foreclosed competitive opportunities.
- Conwood sued asserting, among other claims, monopolization under Sherman Act § 2; USTC denied exclusionary conduct but conceded monopoly power in the relevant market.
- After a jury trial, Conwood won on § 2 and received $350 million in antitrust damages, trebled to $1.05 billion.
- USTC appealed, contesting sufficiency of evidence on exclusionary conduct and antitrust injury/causation and challenging admission and sufficiency of Conwood’s damages expert.

## Issues

1. Whether sufficient evidence supported the jury’s finding that USTC engaged in exclusionary conduct, not merely vigorous competition or isolated torts, satisfying Sherman Act § 2.
2. Whether Conwood presented sufficient evidence of antitrust injury and causation connecting USTC’s conduct to Conwood’s lost sales and reduced competitive opportunity.
3. Whether the district court properly admitted Conwood’s economist’s damages testimony under Rule 702/Daubert and whether it provided a sufficient basis for the jury’s award.

## Decision

- The Sixth Circuit affirmed the judgment for Conwood.
- The court held the record permitted a reasonable jury to find USTC’s retail-level practices were exclusionary and lacked legitimate business justification.
- The court held Conwood presented sufficient evidence that the conduct caused antitrust injury in the form of foreclosed access to effective retail distribution and resulting lost sales.
- The court upheld admission of Conwood’s damages expert and concluded the jury had an adequate evidentiary basis to make a reasonable damages estimate; trebling of damages under federal antitrust law was left intact.

## Legal Principles

- A monopolist violates Sherman Act § 2 by maintaining monopoly power through exclusionary conduct that significantly impairs rivals’ ability to compete and is not justified by legitimate business reasons.
- Coordinated retail practices that remove, destroy, conceal, or otherwise interfere with rivals’ in-store merchandising and shelf presence can constitute exclusionary conduct when used to block competitive access rather than compete on the merits.
- Antitrust injury requires harm of the type the antitrust laws address; a plaintiff may satisfy this by showing lost sales and reduced ability to compete caused by anticompetitive foreclosure, not merely by superior competition.
- In antitrust damages, once liability and injury are established, the factfinder may make a just and reasonable estimate from relevant data; precision is not required.
- Expert testimony on damages is admissible when grounded in accepted economic methods and reliably applied; disputes about assumptions typically go to weight through cross-examination and competing expert evidence.

## Conclusion

The Sixth Circuit sustained a jury finding that a monopolist’s retail-level interference with rivals’ displays and category-management practices could unlawfully maintain monopoly power under Sherman Act § 2, and it affirmed a trebled damages award supported by admissible expert economic analysis and sufficient evidence of antitrust injury and causation.


Conwood Co. v. U.S. Tobacco Co., 290 F.3d 768 (6th Cir. 2002)