Mobile dial codes: The starstar antitrust litigation
Antitrust & Competition
Dr. Debra Aron advised Greenberg Traurig and Winston & Strawn, counsel to Zoove, VHT, and VHTStarStar, and testified at trial on economic issues in antitrust litigation in US District Court, Northern District of California, San Jose. This matter involved mobile dial codes, which are abbreviated dialing shortcuts that can be advertised as a way to reach a company or brand via a voice call from a cell phone. Zoove owned the contracts with the wireless telephone carriers by which certain mobile dial codes, those starting with “**” (“starstar”), would be routed and delivered from wireless callers to their intended destination.
Defendant VHTStarStar (a subsidiary of defendant VHT) purchased the Zoove starstar business after a decade of unsuccessful attempts by the prior owners to develop a profitable business from starstar numbers. VHT and VHTStarStar modified the business model, including changing the terms and conditions under which companies could obtain starstar numbers for resale. The plaintiff, Sumotext, had been a reseller of starstar numbers, and alleged that depriving it of the opportunity to continue to lease and resell starstar numbers under the same terms and conditions available prior to the sale of the business harmed competition in the alleged relevant antitrust market for leasing starstar numbers and the alleged relevant antitrust market for servicing starstar numbers.
Dr. Aron testified on market definition and anticompetitive effects, presenting evidence to the jury on numerous apparent substitutes for starstar numbers. She also presented evidence that there was no harm to consumers or competition resulting from the changed business model. The jury found in favor of the defendants on all counts, concluding that the plaintiff did not adequately define an antitrust market for leasing or servicing starstar numbers.