Eurofix-Bauco v. Hilti

Eurofix and Bauco (Eurofix-Bauco) (plaintiffs) were European producers of nail guns, nails, and related cartridge strips. Hilti (defendant), their competitor, was the largest European producer of those products. Hilti held a dominant position in the nail-gun and cartridge-strip markets, largely due to its patents, but faced greater competition in the nail market. As Hilti’s patents expired, competitors like Eurofix-Bauco began entering the market, selling cartridge strips and nails that were compatible with Hilti’s nail guns. Hilti instituted several purchasing practices with which Eurofix-Bauco took issue. Specifically, Eurofix-Bauco argued that Hilti had excluded them from the market for nails compatible with Hilti products by illegally tying Hilti cartridges to Hilti nails. Eurofix-Bauco alleged that Hilti had done this in a few ways, including by conditioning the purchase of Hilti’s cartridges on buying Hilti nails, inducing distributors to stop supplying compatible cartridge strips to competitors, and refusing to supply cartridges to dealers that might resell them to compatible nail producers like Eurofix-Bauco. Hilti argued that its conduct was objectively justified because compatible nail producers’ products were of substandard quality and presented safety concerns and that Hilti’s sales and distribution practices were motivated by these safety concerns. However, Hilti did not warn customers of its alleged safety concerns with compatible nails, did not write to Eurofix-Bauco with any concerns, and did not report its concerns to any government regulators. Eurofix-Bauco filed a complaint with the European Commission.