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Apax Wins Toss of Bank Rate Listing Antitrust Suit

A New Jersey federal judge on Monday nixed Banxcorp's lawsuit accusing Apax Partners LP of anti-competitive behavior in the market for bank rate listing tables through its subsidiary's acquisition of interest rate monitoring company Bankrate Inc.

Judge Susan D. Wigenton for the U.S. District Court for the District of New Jersey granted Apax's motion to dismiss the case, finding that Banxcorp had not made any specific allegations regarding Apax's conduct.

Banxcorp's lawsuit accused Apax of an illegal restraint of trade and monopolization in violation of Section 2 of the Sherman Act, prohibiting mergers and acquisitions in violation of the Clayton Act and maintaining contracts and combinations in restraint of trade in violation of New Jersey state antitrust law.

The suit initially also targeted Apax subsidiary BEN Holdings Inc., which owns Bankrate, and Europe's Apax Partners LLP, as well as other related companies, but Banxcorp conceded in December to the dismissal, without prejudice, of its claims against all of the original defendants besides Apax, according to court papers.

Banxcorp alleged that Apax Partners LLP in 2009 sought to enter the bank rate listing market through the acquisition of Bankrate, which continued as the surviving corporation after the merger and became a wholly owned subsidiary of BEN Holdings.

The lawsuit maintained that Bankrate conspired with 100 other horizontal competitors, formed a cartel to fix prices, divide markets and allocate customers in the market for bank rate listing websites. The defendants acquired Bankrate to illegally leverage Bankrate's monopoly and market dominance to gain an unfair advantage over independent competitors, Banxcorp alleged.

Judge Wigenton ruled that Banxcorp failed to allege that Apax was tied to any of Bankrate's alleged anti-competitive conduct and did not claim that Apax itself is a competitor in the relevant market.

The court further concluded that Banxcorp could not prove the merger was anti-competitive because Bankrate acquired a dominant share of the relevant market before the merger and the merger did not have any effect on Bankrate's market share.

As such, Judge Wigenton dismissed the lawsuit in its entirety.

However, Banxcorp still has a separate antitrust lawsuit against Bankrate over the same alleged misconduct, which is also being overseen by Judge Wigenton.

That lawsuit claims Bankrate engaged in a process of anti-competitive conduct through acquisitions and agreements with its competitors and that the company operates an unfair monopoly on the market for bank rate listing tables.

Judge Wigenton previously rejected Banxcorp's bid to consolidate the two cases.

Attorneys for Banxcorp and Apax did not immediately respond to requests for comment Tuesday.

Banxcorp was represented by Canter Law Firm PC.

Apax was represented by Saiber LLC and Kirkland & Ellis LLP.

The case against Apax is Banxcorp v. Apax Partners LP et al., case number 2:10-cv-04769, in the U.S. District Court for the District of New Jersey.