Arizona v. Maricopa Cty Med Soc — Doc. 419

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Defendants' Reply in Support of Their Motion to Dismiss the Antitrust Tranche Complaint (Document 419) in In re January 2021 Short Squeeze Trading Litigation, Case 1:21-md-02989-CMA, in the U.S. District Court for the Southern District of Florida, entered on the FLSD docket October 5, 2021. The 30-page reply argues that Plaintiffs fail to plead plausibly that Defendants agreed to conspire, that Plaintiffs fail to plead the remaining elements of a Section 1 claim, and that the antitrust claims are precluded by the federal securities laws under Credit Suisse Sec. (USA) LLC v. Billing, 551 U.S. 264 (2007). It adds that independent reasons exist to dismiss all claims against PEAK6, E*TRADE Holdings and Robinhood Markets, asks that the CCAC be dismissed with prejudice, and is signed /s/ Samuel A. Danon.

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 21-MD-2989-ALTONAGA/TORRES
In re:
JANUARY 2021 SHORT SQUEEZE
TRADING LITIGATION
_____________________________________/
This Document Relates to the Antitrust Tranche
DEFENDANTS¶ REPLY IN SUPPORT OF THEIR MOTION TO DISMISS THE
ANTITRUST TRANCHE COMPLAINT
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 1 of 30

TABLE OF CONTENTS
PRELIMINARY STATEMENT .....................................................................................................1
ARGUMENT ...................................................................................................................................2
I.
PLAINTIFFS FAIL TO PLEAD PLAUSIBLY THAT DEFENDANTS
AGREED TO CONSPIRE. ......................................................................................2
A.
Plaintiffs Allege No Direct Evidence of an Agreement Among
Defendants. ..................................................................................................2
B.
Plaintiffs Do Not Plausibly Allege Circumstantial Evidence of an
Agreement. ...................................................................................................4
II.
PLAINTIFFS FAIL TO PLEAD THE REMAINING ELEMENTS OF A
SECTION 1 CLAIM. ...............................................................................................9
A.
The Court Should Address the Question of Per Se vs. Rule of
Reason at the Motion to Dismiss Stage. ....................................................10
B.
Plaintiffs¶ Allegations Do Not Qualify for Per Se Treatment. ..................10
C.
Plaintiffs¶ Allegations Do Not Qualify for Quick Look Review. ..............14
D.
Plaintiffs Fail to Plead a Section 1 Violation Based on the Rule of
Reason. .......................................................................................................14
III.
PLAINTIFFS¶ ANTITRUST CLAIMS ARE PRECLUDED BY
FEDERAL SECURITIES LAWS..........................................................................16
A.
The Dodd-Frank Act Savings Clause Does Not Apply. ............................16
B.
Plaintiffs¶ Antitrust Claims Are Precluded Under Billing Because
the Conduct at Issue Is Regulated by the Federal Securities Laws. ...........18
IV.
INDEPENDENT REASONS EXIST TO DISMISS ALL CLAIMS
AGAINST PEAK6, E*TRADE HOLDINGS AND ROBINHOOD
MARKETS. ...........................................................................................................20
V.
THE CCAC SHOULD BE DISMISSED WITH PREJUDICE. ............................20
CONCLUSION ..............................................................................................................................20
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TABLE OF AUTHORITIES
Page(s)
Cases
Arizona v. Maricopa Cty. Med. Soc¶y,
457 U.S. 332 (1982) .................................................................................................................10
Auto Alignment & Body Serv. v. State Farm Mut. Auto. Ins. Co.,
953 F.3d 707 (11th Cir. 2020) ...................................................................................................4
Bell Atlantic Corp. v. Twombly,
550 U.S. 544 (2007) ...........................................................................................................2, 4, 5
In re Blue Cross Blue Shield Antitrust Litig.,
308 F. Supp. 3d 1241 (N.D. Ala. 2018) ...................................................................................12
Broad. Music, Inc. v. Columbia Broad. Sys., Inc.,
441 U.S. 1 (1979) .....................................................................................................................13
Bus. Elecs. Corp. v. Sharp Elecs. Corp.,
485 U.S. 717 (1988) .................................................................................................................10
California ex rel. Harris v. Safeway Inc.,
651 F.3d 1118 (9th Cir. 2011) .................................................................................................14
City of Tuscaloosa v. Harcros Chems.,
158 F.3d 548 (11th Cir. 1998) ...................................................................................................8
In re Credit Default Swaps Antitrust Litig.,
No. 13-md-2476, 2014 WL 4379112 (S.D.N.Y. Sept. 4, 2014) ..............................................16
Credit Suisse Sec. (USA) LLC v. Billing,
551 U.S. 264 (2007) ...........................................................................................................17, 19
In re Delta/AirTran Baggage Fee Antitrust Litig.,
733 F. Supp. 2d 1348 (N.D. Ga. 2020) ......................................................................................7
Dickson v. Microsoft Corp.,
309 F.3d 193 (4th Cir. 2002) ...................................................................................................12
In re Disposable Contact Lens Antitrust,
215 F. Supp. 3d 1272 (M.D. Fla. 2016) ...............................................................................8, 13
Elec. Trading Grp., LLC v. Banc of Am. Sec. LLC,
588 F.3d 128 (2d Cir. 2009).....................................................................................................20
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In re Farm-Raised Salmon & Salmon Prods. Antitrust Litig.,
No. 19-21551-CIV, 2021 WL 1109128 (S.D. Fla. Mar. 23, 2021) ...................................2, 6, 9
In re Fla. Cement & Concrete Antitrust Litig.,
746 F. Supp. 2d 1291 (S.D. Fla. 2010) ............................................................................ passim
In re High-Tech Emps. Antitrust Litig.,
856 F. Supp. 2d 1103 (N.D. Cal. 2012) ...................................................................................10
In re Interest Rate Swaps Antitrust Litig.,
261 F. Supp. 3d 430 (S.D.N.Y. 2017) ......................................................................................16
Interstate Cir. v. United States,
306 U.S. 208 (1939) ...................................................................................................................8
Jacobs v. Tempur-Pedic Int¶l, Inc.,
626 F.3d 1327 (11th Cir. 2010) ....................................................................................... passim
Kalmanovitz v. G. Heileman Brewing Co.,
769 F.2d 152 (3d Cir. 1985).....................................................................................................15
Lenox v. MacLaren Surgical Corp.,
847 F.3d 1221 (10th Cir. 2017) ...............................................................................................20
Levine v. Cent. Fla. Med. Affiliates, Inc.,
72 F.3d 1538 (11th Cir. 1996) ...........................................................................................10, 14
Mitchael v. Intracorp, Inc.,
179 F.3d 847 (10th Cir. 1999) .................................................................................................20
Monsanto Co. v. Spray-Rite Serv. Corp.,
465 U.S. 752 (1984) ...................................................................................................................2
In re Musical Instruments & Equip. Antitrust Litig.,
798 F.3d 1186 (9th Cir. 2015) .............................................................................................7, 12
Nat¶l Collegiate Athletic Ass¶n v. Bd. of Regents of Univ. of Oklahoma,
468 U.S. 85 (1984) ...................................................................................................................13
Nat¶l Soc. of Prof¶l Eng¶rs v. United States,
435 U.S. 679 (1978) ...........................................................................................................10, 13
Ohio v. Am. Express Co.,
138 S. Ct. 2274 (2018) .................................................................................................10, 12, 15
Procaps S.A. v. Pantheon, Inc.,
845 F.3d 1072 (11th Cir. 2016) ...............................................................................................10
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PSKS, Inc. v. Leegin Creative Leather Prod., Inc.,
615 F.3d 412 (5th Cir. 2010) ...................................................................................................15
Quality Auto Painting Ctr. of Roselle, Inc. v. State Farm Indem. Co.,
917 F.3d 1249 (11th Cir. 2019) ....................................................................................... passim
Total Benefits Plan. Agency, Inc. v. Anthem Blue Cross & Blue Shield,
552 F.3d 430 (6th Cir. 2008) ...................................................................................................12
United States v. Andreas,
39 F. Supp. 2d 1048 (N.D. Ill. 1998) .......................................................................................13
United States v. eBay, Inc.,
968 F. Supp. 2d 1030 (N.D. Cal. 2013) ...................................................................................10
United States v. Gen. Motors Corp.,
384 U.S. 127 (1966) .................................................................................................................12
Statutes & Rules
12 U.S.C. § 5303 ............................................................................................................................16
15 U.S.C. § 1 .......................................................................................................................... passim
15 U.S.C. § 78a, et seq ...................................................................................................................17
Phillip Areeda & Herbert Hovenkamp, Antitrust Law ¶ 1508 (4th & 5th eds.,
2021 Cum. Supp. 2013-2020) ..................................................................................................14
Dodd-Frank Act §§ 1(a), 6, 124 Stat. 1376 (2010) ........................................................................16
Dodd-Frank Act § 913(g)...............................................................................................................17
Exchange Act § 9, 15 U.S.C. § 78i ....................................................................................17, 18, 19
Exchange Act § 10, 15 U.S.C. § 78j ..................................................................................17, 18, 19
Exchange Act § 15, 15 U.S.C. § 78o .......................................................................................17, 19
Exchange Act § 17, 15 U.S.C. § 78q .............................................................................................19
Exchange Act § 17A, 15 U.S.C. § 78q-1 .......................................................................................19
Fed. R. Civ. P. 12(b)(6)..................................................................................................................10
Other Authorities
17 C.F.R. §§ 240.15a-1 to 240.15c6-1 ...........................................................................................19
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17 C.F.R. § 240.15c3-5 ............................................................................................................18, 19
SEC, Thinking About Investing in the Latest Hot Stock? (Jan. 30, 2021),
https://www.sec.gov/oiea/investor-alerts-and-bulletins/risks-short-term-
trading-based-social-media-investor-alert ...............................................................................18
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 6 of 30

PRELIMINARY STATEMENT
After eight months to consider their claims, review of tens of thousands of pages
of documents produced by Defendants concerning the relevant events and three rounds of
complaints (including the current ³Corrected Consolidated Class Action Complaint´ (³CCAC´)),
Plaintiffs have utterly failed to plead a cognizable antitrust claim that can survive a motion to
dismiss.  The crux of Plaintiffs¶ implausible theory is that a group of unrelated Self-Clearing
Brokers and Clearing Brokers all decided to impose different trading restrictions on partially
overlapping, but different, sets of stocks to help save Citadel Securities from its supposed short
position in some unspecified, speculative number of those stocks.  What is missing from the
CCAC are, inter alia, (1) sufficient factual allegations of any agreement between any Defendants
(let alone among all of them) to restrict trading in any security; (2) any attempt to identify any
benefit that any of the brokers (self-clearing or otherwise) received from allegedly restricting
trading to help Citadel Securities; or (3) any plausible explanation for how a conspiracy arose
that resulted in the members imposing disparate restrictions on disparate sets of stocks, while at
the same time other brokers not alleged to be part of the conspiracy and/or now voluntarily
dismissed from the case took similar steps.  Plaintiffs¶ Opposition does nothing to deal with these
deficiencies.  The facts alleged in the CCAC give rise to only one plausible explanation:  in the
face of unprecedented market volatility spurred on by internet speculation, various brokers,
including non-Defendants, acted independently to protect the integrity of the marketplace and
their customers¶ ability to trade broadly in securities by implementing a variety of temporary
trading restrictions that differed in duration and scope, tailored to each of their circumstances.
Rather than deal with these problems, Plaintiffs present an array of often
inconsistent factual and legal arguments that misconstrue and ignore their own pleadings, the
evidence on which they rely, the relevant law and the very cases they cite.  Plaintiffs boldly
proclaim that this is the rare case in which there is direct evidence of a conspiracy²and then
immediately walk that back by conceding that none of the cited documents actually reflects any
agreement at all.  (Section I.A.)  Plaintiffs claim to have plausibly alleged parallel conduct and
plus factors, but ignore the plausible (and accurate) alternative explanation and fail to establish
that any plus factors even apply to the facts alleged.  (Section I.B.)  Plaintiffs cling to claims of
per se condemnation, but ignore the fact that they have not alleged a horizontal conspiracy, let
alone one that meets the per se test.  (Section II.A-B.)  Plaintiffs assert that the CCAC adequately
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pleads a rule of reason violation, but fail even to identify the relevant market with any specificity
(never mind allege facts that would support any market definition), or to allege market power or
anticompetitive effects.  (Section II.C.)  Finally, Plaintiffs attempt to save their antitrust claims
from preclusion by the securities laws by invoking a savings clause from the Dodd-Frank Act,
but ignore the fact that this clause has nothing to do with the alleged unlawful conduct.
(Section III.)  For these reasons and those set forth below and in Defendants¶ opening motion
(³MTD´), the CCAC should be dismissed with prejudice.
ARGUMENT
I.
PLAINTIFFS FAIL TO PLEAD PLAUSIBLY THAT DEFENDANTS AGREED
TO CONSPIRE.
Courts must determine whether the complaint ³contains µallegations plausibly
suggesting (not merely consistent with) [a conspiracy or] agreement.¶´  Jacobs v. Tempur-Pedic
Int¶l, Inc., 626 F.3d 1327, 1332-33 (11th Cir. 2010) (quoting Bell Atlantic Corp. v. Twombly, 550
U.S. 544, 557 (2007)).  Plaintiffs must allege ³direct or circumstantial evidence that reasonably
tends to prove that the [defendant] and others had a conscious commitment to a common scheme
designed to achieve an unlawful objective.´  Monsanto Co. v. Spray-Rite Serv. Corp., 465 U.S.
752, 768 (1984).  They must plead such an agreement involving each and every Defendant.  See
Quality Auto Painting Ctr. of Roselle, Inc. v. State Farm Indem. Co., 917 F.3d 1249, 1261-62
(11th Cir. 2019) (en banc) (requiring allegations for ³each defendant´ in the conspiracy).  But, as
set forth in Defendants¶ MTD, Plaintiffs fail to do so²even after gaining access to the tens of
thousands of pages of documents Defendants have produced to regulators.  (MTD at 15.)
A.
Plaintiffs Allege No Direct Evidence of an Agreement Among Defendants.
Plaintiffs boast that this is the ³rare case´ in which there is ³[d]irect evidence of
an agreement [that] is explicit and requires no inferences to establish the proposition or
conclusion being asserted.´  (Opp. at 5-6 (citing In re Farm-Raised Salmon & Salmon Prods.
Antitrust Litig., No. 19-21551-CIV, 2021 WL 1109128, at *10 (S.D. Fla. Mar. 23, 2021)).)
Plaintiffs promptly retract this baffling assertion when they concede²in a footnote²that ³the
written communications appear deliberately vague and do not describe the contents of what was
agreed to . . . .´  (Opp. at 6 n.6.)  Therefore, by their own concession, Plaintiffs do not have
³direct evidence of an agreement [that] is explicit and requires no inferences to establish the
proposition or conclusion being asserted.´  Salmon, 2021 WL 1109128, at *10.
Even aside from that concession, it is clear that the communications cited by
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Plaintiffs do not evidence any agreement at all, let alone the anticompetitive agreement Plaintiffs
ask the Court to infer.  (See Opp. at 6; MTD at 15-16.)  The communications between Robinhood
and Citadel Securities (and among Robinhood employees about Citadel Securities) do not
contain or indicate any agreement to restrict trading in any security.  (CCAC ¶¶ 296-305, 307-13,
452-53.)  The email that Plaintiffs quote between E*TRADE and Citadel Securities employees is
no more than a routine daily trading account reconciliation email canceling ten trade orders, and
Plaintiffs fail to allege that the email even pertains to the Relevant Securities.  (Id. ¶¶ 316, 454.)
Plaintiffs¶ allegation that Apex ³instructed brokerages,´ such as Ally, Dough, Public.com, SoFi,
Stash, Tastyworks and Webull (who were all Introducing Broker Defendants before Plaintiffs
voluntarily dismissed them), also does not at all indicate an agreement to restrict trading between
Apex and any party.  At best it reflects a notification from Apex, as the Clearing Broker for these
Introducing Broker Defendants (Apex¶s customers), that it would not accept trade orders for
GME, AMC and KOSS on the morning of January 28, 2021, and complaints by at least some of
those brokers about Apex¶s notification.  (Id. ¶¶ 274-76, 241, 443.)  Finally, Plaintiffs refer to a
message describing a call between a Robinhood Financial employee and an Apex employee that
flags a Reddit thread highlighting a way in which customers were circumventing Robinhood¶s
restrictions on options trading.  (Opp. at 7.)  Plaintiffs do not explain²in either the CCAC or the
Opposition²why this message suggests the existence of a conspiracy, particularly where Apex
had already lifted its trading restrictions at that time.  (Id.)  Nor do they explain why Apex would
have ³policed´ the alleged conspiracy after discontinuing its own trading restrictions.  (Id.)
Moreover, the CCAC is devoid of any allegation of any communications (let
alone any agreement) between:  (1) Citadel Securities and Apex, (2) Citadel Securities and
Interactive Brokers, (3) Citadel Securities and any (now dismissed) Introducing Broker
Defendants, (4) Robinhood and E*TRADE, (5) Robinhood and Interactive Brokers,
(6) Robinhood and any (now dismissed) Introducing Broker Defendants, (7) Apex and
E*TRADE, (8) Apex and Interactive Brokers, (9) E*TRADE and Interactive Brokers,
(10) E*TRADE and any (now dismissed) Introducing Broker Defendants, and (11) Interactive
Brokers and any (now dismissed) Introducing Broker Defendants.1

1 Because Plaintiffs do not (and cannot) allege any communications between Interactive Brokers
and any other defendant, Plaintiffs again point to Thomas Peterffy¶s public statement but, as
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In short, the cited communications show only that some defendants have pre-
existing business relationships.  The fact that they would communicate during the relevant time
is not only unremarkable, it is in fact fully expected.  It certainly does not give rise to an
inference of a conspiracy, let alone provide direct evidence of one.
B.
Plaintiffs Do Not Plausibly Allege Circumstantial Evidence of an Agreement.
Without direct evidence, Plaintiffs are left to plead circumstantial evidence of
their alleged conspiracy theory.  (Opp. at 7-21.)  Plaintiffs must plead ³parallel conduct´ and
³sufficient µplus factors¶ to make the parallel conduct µmore probative of conspiracy than of
conscious parallelism.¶´  Auto Alignment & Body Serv. v. State Farm Mut. Auto. Ins. Co., 953
F.3d 707, 726 (11th Cir. 2020).  Plaintiffs erroneously contend that Defendants urge a
³probability,´ rather than ³plausibility,´ standard.  (Opp. at 5 n.4.)  In fact, Defendants¶ MTD
expressly argues the plausibility standard of Twombly and explains that Plaintiffs¶ allegations
³must be placed in a context that raises a suggestion of a preceding agreement, not merely
parallel conduct that could just as well be independent action.´  (MTD at 16 (quoting Twombly,
550 U.S. at 557)); see also Auto Alignment, 953 F.3d at 728-29 (plaintiffs ³offer no allegations
that explain why the loss in business they allege is plausibly explained by steering instead of
µother alternative explanation[s]¶´ (quoting Twombly, 550 U.S. at 567)).  The Court may ³infer
from the factual allegations in the complaint obvious alternative explanations, which suggest
lawful conduct rather than the unlawful conduct the plaintiff would ask the court to infer.´  In re
Fla. Cement & Concrete Antitrust Litig., 746 F. Supp. 2d 1291, 1308 (S.D. Fla. 2010) (citation
omitted) (internal quotations and alteration omitted).
Here, Plaintiffs fail to establish that the CCAC alleges that the trading restrictions
at issue are ³plausibly explained by [a conspiracy] instead of µother alternative explanations.¶´
Auto Alignment, 953 F.3d at 728-29 (citation omitted); see also Quality Auto, 917 F.3d at 1267
(³Even if there were considerable uniformity with respect to the [defendants¶] use of such
methods, that would be suggestive of an agreement only if such usage would not plausibly arise
from µindependent responses to common stimuli.¶´) (citation omitted).  For example, Plaintiffs
offer no explanation for why it is plausible to infer a conspiracy among the Defendants when
other brokerages²not alleged to be part of any conspiracy²³employed similar tactics to prevent

explained in the MTD, that statement only confirms that Interactive Brokers was acting in its
own interests and not as part of some conspiracy.  (MTD at 24-25.)
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Retail Investors from opening positions in at least one or more of the Relevant Securities.´
(MTD at 18; CCAC ¶ 246.)  These brokerages included TD Ameritrade (restrictions on GME
and AMC) and Charles Schwab (restrictions on GME, AMC and EXPR), neither of which
Plaintiffs allege conspired with anyone.  (MTD at 18; CCAC ¶¶ 198-199.)  They also included
Cash App Investing LLC, eToro USA Securities, Inc. and Barclays Bank PLC, which Plaintiffs
similarly do not allege were part of any conspiracy.  (MTD at 18.)  The fact that parties not
alleged to be members of the conspiracy acted similarly as alleged conspirators indicates that the
restrictions arose from permissible business reasons, not anticompetitive ones.
Nor do Plaintiffs grapple with the fact that their own allegations supply the
obvious, alternative (and actual) explanation for why each broker Defendant (and non-
Defendant) enacted trading restrictions in late January 2021:  the extraordinary market volatility.
(CCAC ¶¶ 200-209.)  This was the ³common stimul[us]´ to which Defendants had ³independent
responses.´  Twombly, 550 U.S. at 556 n.4; Quality Auto, 917 F.3d at 1267.  The market
volatility spurred the NSCC to issue outsized collateral calls on many brokers, including some
broker Defendants, which, in turn, required them to take individual measures to reduce their
firms¶ risk exposure.  (MTD at 16-20; CCAC ¶¶ 231, 274-276, 413.)  Still others were compelled
by the volatility to implement their own restrictions, even absent outsized collateral calls.  (MTD
at 11-12.)  The market volatility, as Plaintiffs plead (MTD at 8-10), thus provides a ³discernible
reason´ for Defendants¶ independent conduct and defeats a plausible inference of conspiracy.
Twombly, 550 U.S. at 556 n.4; Fla. Cement, 746 F. Supp. 2d at 1308 (the court may ³infer from
the factual allegations in the complaint µobvious alternative explanations¶´) (citation omitted).
1.
Plaintiffs Cannot Plead Parallel Conduct.
Plaintiffs claim that Defendants ³engaged in virtually identical, highly-correlated´
conduct and that this ³implies the existence of an alleged conspiracy.´  (Opp. at 9.)  But
Plaintiffs do not plausibly explain how a conspiracy could involve the disparate restrictions of
varying durations pleaded here.  (MTD at 19.)  As set forth in the MTD, each Defendant put in
place restrictions for different stock symbols, for different durations and for varying types of
trades.2  (Id.)  For example, Robinhood placed PCO restrictions on both stock and option trades

2 Plaintiffs also contend in their Opposition that the ³restrictions prohibiting retail investors from
purchasing the Relevant Securities [occurred] less than 24 hours after Citadel Securities acquired
massive short positions in the Relevant Securities.´  (Opp. at 9 (emphasis in original).)  Plaintiffs
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for all 9 of the Relevant Securities (as well as 4 others not alleged by Plaintiffs to have been
restricted as a result of some purported conspiracy).  (Id.)  Plaintiffs allege Interactive Brokers
restricted only the purchase of options for 5 of the 9 Relevant Securities (AMC, BB, EXPR,
GME and KOSS).  (Id.)  Clearing Broker Apex applied stock purchasing restrictions for only 3
of the 9 Relevant Securities (AMC, GME and KOSS).  And E*TRADE limited some trading in
only 2 of the 9 Relevant Securities (GME and AMC).  Plaintiffs contend that these restrictions
³had the goal and the same effect²artificially decreasing the price of the Relevant Securities.´
(Opp. at 9 n.12.)  But if the goal were to ³decrease´ the price of the Relevant Securities, it is
implausible that Defendants would agree to vary their restrictions in such disparate ways, and
that many of the alleged conspirators would take no action with respect to many (and for Apex
and E*TRADE, most) of the Relevant Securities.  By contrast, the obvious, alternative
explanation, alleged in the CCAC, is that the restrictions were driven by market volatility, which
forced various brokers (including the broker Defendants) separately to impose different trading
restrictions to mitigate volatility flowing through their respective firms.  (MTD at 19-20.)
2.
Plaintiffs¶ Alleged Plus Factors Do Not Make Their Conspiracy Claim
Plausible.
Plaintiffs fare no better arguing that they pleaded ³µsufficient plus factors to make
the parallel conduct more probative of conspiracy¶´ than of independent conduct.  Salmon, 2021
WL 1109128, at *10 (citation omitted); see also Quality Auto, 917 F.3d at 1267 (recognizing
plus factors as evidence that ³tends to exclude the possibility of independent action´).3
First, Plaintiffs fail to articulate a plausible common motive for Defendants to
engage in the alleged conspiracy.  The only common motive that Plaintiffs assert is that
³Defendants had a collective interest in maintaining their mutually beneficial business
relationships´ based on ³lucrative payment for order flow relationships with Citadel Securities.´
(Opp. at 11-12.)  This argument fails.  As an initial matter, Plaintiffs do not allege adequately
that Citadel Securities actually held a short position in the Relevant Securities.  In fact, Plaintiffs
admit ³it is generally impossible to ascertain which investors have a short position in a particular

are merely speculating, however, as they concede ³it is generally impossible to know who owns
a short interest at any given time despite the prevailing regulatory regime.´  (CCAC ¶ 387.)
3 The Eleventh Circuit¶s recent en banc decision in Quality Auto expressly considered the
sufficiency of alleged plus factors in support of a conspiracy claim at the motion to dismiss
stage.  917 F.3d at 1267-69.  Plaintiffs¶ argument that courts consider the sufficiency of alleged
plus factors only at summary judgment is unavailing.  (Opp. at 8 n.11.)
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security at any point in time.´  (Opp. at 20; CCAC ¶ 387.)  Furthermore, Plaintiffs do not allege
that Citadel Securities threatened to (or even suggested that it would) cut off business
relationships with any broker Defendant, or that it would retaliate against any Defendant if those
brokers did not agree to protect Citadel Securities¶ alleged short position in the Relevant
Securities.  Plaintiffs observe that both parties benefit from PFOF as a mutually beneficial
relationship.  (Opp. at 12.)  Further, Plaintiffs do not address the obvious fact that Citadel
Securities is not the only market maker; if it had cut off PFOF, there are other entities from
which brokers direct order flow and receive such payments.  (See CCAC ¶¶ 3, 291.)  Finally,
Plaintiffs do not allege that Citadel Securities stopped accepting buy orders for the Relevant
Securities from any brokers at any time.  In short, this conspiracy theory is implausible because
Defendants had nothing to gain from entering into the alleged conspiracy.4  (MTD at 20-21.)
Second, and relatedly, Plaintiffs fundamentally misunderstand the acting-against-
unilateral-self-interest plus factor and therefore fail to plead that it is probative of a conspiracy.
Actions against unilateral self-interest are probative only if they further a collective self-interest.
See In re Musical Instruments & Equip. Antitrust Litig., 798 F.3d 1186, 1195 (9th Cir. 2015)
(noting that this plus factor weighed against collusion where there were ³ample independent
business reasons why each of the [defendants] adopted and enforced [certain] policies even
absent an agreement among the defendant[s]´); see also In re Delta/AirTran Baggage Fee
Antitrust Litig., 733 F. Supp. 2d 1348, 1361 (N.D. Ga. 2020) (³Plaintiffs have alleged that Delta
and AirTran communicated with each other in public regarding how both airlines could µget
average prices up¶ . . . and would impose a first-bag fee during a recession even though it was
counter to either Defendant¶s self interest to do so alone.´).  Under such circumstances, a firm
acts against unilateral self-interest to pursue a larger profit opportunity that cannot be realized
except by agreement among competitors.
But here, all Plaintiffs offer by way of explanation is that ³if a broker were to
unilaterally restrict trading, they would lose investors to other brokers who were not restricting
unless the broker knew others were restricting.´  (Opp. at 14.)  This does not explain why any
broker Defendant would impose the trading restrictions pursuant to any agreement in the first

4 Plaintiffs¶ theory of a common motive is further belied by the fact that they do not²and
cannot²allege that Interactive Brokers receives significant PFOF revenue from Citadel
Securities.
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place.  Imposing the restrictions reduced transactions and order flow for each broker and cost
that broker revenue whether done individually or collectively; the fact that other brokers also
imposed some restrictions did nothing to offset that loss.  And Plaintiffs do not plead (and do not
argue in their Opposition) that any broker Defendant engages in short-selling for their own
accounts or would otherwise benefit from any stock price movement.  (MTD at 20.)  Therefore,
this is nothing like the paradigmatic situation where it makes no sense for one competitor to raise
prices, but all competitors benefit if all raise prices, and Plaintiffs thus fail to establish that this
plus factor is at all probative of an alleged conspiracy.5
Third, Plaintiffs¶ claims of alleged opportunity to collude fall far short of the
allegations that this Court has found sufficient in other cases.  (Opp. at 15-17; MTD at 23-25.)
Plaintiffs contend, in generic terms, that Defendants had opportunity to collude because the
³financial industry is close-knit´ and ³secretive, replete with specialized jargon and
terminology.´  (Opp. at 15.)  They also claim Defendants ³communicated on the telephone or
through agents,´ which Plaintiffs claim is ³inculpatory or suspicious,´ even though the emails
regarding those limited communications were replicated in the CCAC, and none indicate any
agreement.  (Id. at 14-16.)  These alleged factors fall well short of what this Court rejected in
Florida Cement, in which the defendants held meetings and social events to coordinate the
alleged conspiracy.  (MTD at 25.)  Plaintiffs¶ allegations of concealment and pretext fare no
better.  Plaintiffs argue that ³Robinhood initially attributed the trading restrictions to market
volatility, only to later assert that clearinghouse collateral requirements forced Robinhood to
impose said restrictions.´  (Opp. at 17.)  This is not ³inconsistent and conflicting´ (id.)²rather
market volatility led to the increased collateral requirements.  As Plaintiffs alleged, the NSCC
calculates its collateral requirements based, in part, on a volatility multiplier, where greater
market volatility increases the amount of collateral the NSCC requires.  (MTD at 7-8; CCAC
¶¶ 470-471.)  Nor is it conflicting that ³Robinhood nonetheless decided to restrict purchases of

5 It is for this reason that all of Plaintiffs¶ cited authorities undermine, rather than support, their
position.  See Interstate Cir. v. United States, 306 U.S. 208, 216-18, 226-27 (1939) (finding
parties joining conspiracy would benefit from supracompetitive profits); City of Tuscaloosa v.
Harcros Chems., 158 F.3d 548, 570 n.33 (11th Cir. 1998) (noting ³a price-fixing conspiracy, if
successfully implemented, is in the collective self-interest of the conspirators´); In re Disposable
Contact Lens Antitrust, 215 F. Supp. 3d 1272, 1294-97 (M.D. Fla. 2016) (observing actions
taken against self-interest would result in higher retail sales prices for all conspirators).
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the Relevant Securities throughout the entirety of the trading day´ after ³Robinhood was in fact
able to meet its January 28 clearinghouse collateral requirement.´  (Opp. at 17.)  Robinhood
placed those trading restrictions on the most volatile stocks at the time (including the Relevant
Securities), which would be expected to reduce the volatility multiplier on the collateral that
Robinhood Securities was required to post with the NSCC.  (MTD at 10-11.)  Moreover, as
Plaintiffs acknowledge, the market volatility in late January 2021 was extraordinary, with events
occurring quickly to meet market and clearinghouse demands.  Therefore, it is understandable
that earlier-in-time internal Robinhood and Apex communications, as Plaintiffs identified, did
not reflect final information later presented publicly.  (Opp. at 17.)
Fourth, Plaintiffs repeat that government investigations ³are indicative of
anticompetitive collusion.´  (Opp. at 18.)  But simply pleading ³the existence of government
inquiries [is] insufficient to raise an inference of conspiracy.´  Salmon, 2021 WL 1109128, at
*17.  Indeed, Plaintiffs later claim:  ³there is no evidence that the SEC is investigating or plans to
investigate Defendants¶ collusive behavior.´  (Opp. at 39.)
Fifth, Plaintiffs¶ allegations about the ³structural characteristics of the market´ do
nothing to support their inference of conspiracy.  (MTD at 26.)  As Defendants¶ MTD explains,
the ³structural characteristics´ plus factor involves scenarios where a ³series of horizontal
competitors commanded such an uncontestable share of the marketplace that they would profit
from raising prices, restricting output or reducing quality.´  (Id. (citing Fla. Cement, 746 F.
Supp. 2d at 1317).)  Although Plaintiffs generally allege that structural market characteristics
support an inference of conspiracy, it is unclear which alleged relevant market or markets they
seek to characterize.  For example, Plaintiffs conflate starting a securities brokerage firm, for
which they assert there are barriers to entry, with the ability for retail investors to open accounts
to trade securities on competing retail brokerage platforms, for which there are no barriers to
entry.  (Opp. at 19.)  In sum, Plaintiffs fail to show direct or circumstantial evidence of a
conspiracy.  The CCAC should be dismissed for this reason alone.
II.
PLAINTIFFS FAIL TO PLEAD THE REMAINING ELEMENTS OF A
SECTION 1 CLAIM.
Even if Plaintiffs had adequately alleged an agreement²and they have not²they
still have not adequately pleaded their antitrust claim because their alleged conspiracy cannot be
subject to per se condemnation and the CCAC fails to define the relevant market, adequately
allege market power and plead anticompetitive effects as required to plead a rule of reason claim.
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A.
The Court Should Address the Question of Per Se vs. Rule of Reason at the
Motion to Dismiss Stage.
Plaintiffs wrongly assert that the antitrust standard of review is ³not ripe´ on a
Rule 12(b)(6) motion.  In fact, it is common and appropriate for courts to consider at the motion
to dismiss stage whether the allegations in a complaint should be analyzed under the per se
standard or the rule of reason.  (MTD at 28.)  None of the cases cited by Plaintiffs dictates a
different result.  See Arizona v. Maricopa Cty. Med. Soc¶y, 457 U.S. 332, 342-46 (1982)
(discussing per se and rule of reason analysis generally); United States v. eBay, Inc., 968 F.
Supp. 2d 1030, 1037-40 (N.D. Cal. 2013) (deciding on motion to dismiss whether complaint
adequately alleged a per se or quick look violation); In re High-Tech Emps. Antitrust Litig., 856
F. Supp. 2d 1103, 1115 n.9 (N.D. Cal. 2012) (noting that parties agreed that court need not
decide between per se and rule of reason on motion to dismiss in that case, where plaintiff
alleged horizontal agreement).  Here, Plaintiffs fail to allege any possible agreement to which per
se treatment could apply.  See Tempur-Pedic, 626 F.3d at 1334-36; Quality Auto, 917 F.3d at
1271-72.  Although the Court should dismiss based on the lack of plausible allegations of an
agreement alone, if it is not inclined to do so, the Court should determine which standard applies
now as that implicates the additional reasons for dismissal set forth in this section.
B.
Plaintiffs¶ Allegations Do Not Qualify for Per Se Treatment.
Plaintiffs¶ allegations do not fit within the narrow category of cases to which per
se treatment is confined.  Per se treatment is typically limited to certain ³µhorizontal restraints¶²
restraints µimposed by agreement between competitors.¶´  Ohio v. Am. Express Co., 138 S. Ct.
2274, 2283-84 (2018) (quoting Bus. Elecs. Corp. v. Sharp Elecs. Corp., 485 U.S. 717, 730
(1988)).  And even with respect to horizontal restraints, only a limited number are ³so plainly
anticompetitive that no elaborate study of the industry is needed to establish their illegality.´
Procaps S.A. v. Pantheon, Inc., 845 F.3d 1072, 1083 (11th Cir. 2016) (quoting Nat¶l Soc. of
Prof¶l Eng¶rs v. United States, 435 U.S. 679, 692 (1978)).  Those are ³horizontal price fixing
among competitors, group boycotts, and horizontal market division²business relationships that,
in the courts¶ experience, virtually always stifle competition.´  Tempur-Pedic, 626 F.3d at 1334.
Finally, courts apply the per se standard ³only when history and analysis have shown that in
sufficiently similar circumstances´ application of ³the rule of reason unequivocally results in a
finding of liability.´  Levine v. Cent. Fla. Med. Affiliates, Inc., 72 F.3d 1538, 1549 (11th Cir.
1996) (citations omitted).  The per se standard does not apply to the claims here because (1) they
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are not a horizontal restraint and (2) they do not fall into the per se categories of restraints.
1.
 Plaintiffs Do Not and Cannot Allege a Horizontal Agreement.
Plaintiffs try to satisfy the requirement of a horizontal restraint in two ways.  They
argue in the alternative either that all Defendants are competitors in the same market, so that the
alleged conspiracy would be horizontal (Opp. at 21-25), or that, even though Citadel Securities
operates at a different market level from any of the other Defendants (who themselves do not
operate at the same market level), Plaintiffs adequately have pleaded a so-called hub-and-spoke
conspiracy (id. at 26-27).  Neither argument succeeds.
First, Defendants are not horizontal competitors.  While Plaintiffs summarily
assert that ³Defendants are horizontal competitors´ (Opp. at 21), the CCAC contains no such
allegation, which is likely why there is no citation for the proposition in Plaintiffs¶ brief.  (See
Opp. at 21.)  Indeed, their Opposition lacks any explanation for how that could possibly be true,
and Plaintiffs¶ explanation of Defendants¶ different roles describes a vertical, rather than
horizontal, structure.  (Id. at 23-24.)  Defendants act at three distinct levels:
 Introducing Brokers are customer-facing entities through which retail investors may
access financial markets.  (MTD at 4-5.)  Certain introducing brokers also have affiliated
clearing entities or internally clear their own trades²the CCAC refers to these firms as
³Self-Clearing Brokers.´  (Id. at 5.)  All of the Introducing Brokers that contract with
separate Clearing Brokers were dismissed from this case, leaving as Defendants only
three ³Self-Clearing Brokers´:  Robinhood, E*TRADE and Interactive Brokers.  (Id.)
 Clearing Brokers process the trades on the customers¶ behalf to ensure that the trades are
able to clear and custody of the securities and assets are transferred to the appropriate
entity.  (Id. at 5-6.)  Clearing Brokers, as defined in the CCAC, operate independently
from any introducing brokers.  The two companies owned by PEAK6 Investments, Apex
and ETC, are the only alleged independent Clearing Broker Defendants.  (Id.)
Market Makers stand ready to fill certain orders routed to them by Introducing Brokers.
(Id. at 6.)  The only named Market Maker Defendant is Citadel Securities.  (Id.)
No Defendant is alleged to compete with Citadel Securities:  the broker Defendants are not
market-makers, and Citadel Securities is neither an Introducing Broker (it has no customers of its
own), nor does it provide clearing services for other brokers.  Self-Clearing Brokers are also not
alleged to compete with Clearing Brokers:6  the Self-Clearing Brokers are not alleged to be in the
business of clearing trades for other introducing brokers and the Clearing Brokers are not alleged

6 And the Introducing Brokers are not alleged to compete with Clearing Brokers.  (MTD at 4-5.)
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12
to be in the business of attracting trading accounts from retail investors.  Defendants plainly do
not all compete with one another and Plaintiffs are wrong to assert that the alleged agreement is
³between horizontal competitors.´  Am. Express, 138 S. Ct. at 2284.7
Second, Plaintiffs argue in the alternative that ³Plaintiffs¶ claims should
nevertheless receive per se treatment because Plaintiffs have also pleaded a hub and spoke
conspiracy,´ where Citadel Securities is the alleged hub and the broker Defendants are all spokes
on the wheel.  (Opp. at 26-27.)  But Plaintiffs fail to allege any communications between Citadel
Securities and many of the purported ³spokes.´  And as Plaintiffs concede, a hub-and-spoke
conspiracy is subject to per se treatment only where there is an underlying horizontal agreement,
i.e., not just agreements between the hub and each spoke, but also a series of agreements along
the rim of the wheel.  (Id.)  Here, that would mean each broker Defendant would need to be in
agreement with each other, but there are no allegations to that effect.  Without the agreements
along the rim, Plaintiffs are left with a series of alleged vertical agreements (between the hub and
each spoke) and no horizontal agreement, as required for per se treatment.
Numerous courts have confronted similar allegations, where ³various defendants
enter into separate agreements with a common defendant, but where the defendants have no
connection with one another, other than the common defendant¶s involvement in each
transaction,´ and have labeled such allegations as a ³rimless hub-and-spoke conspiracy.´  See,
e.g., Dickson v. Microsoft Corp., 309 F.3d 193, 203 (4th Cir. 2002).  Notably, however, there is
³one key difference between a rimless hub-and-spoke conspiracy (i.e., a set of purely vertical
agreements) and a rimmed hub-and-spoke conspiracy (i.e., a set of vertical agreements joined by
horizontal agreements):  courts analyze vertical agreements under the rule of reason . . . whereas
horizontal agreements are violations per se.´  Musical Instruments, 798 F.3d at 1192 n.3; see
also Total Benefits Plan. Agency, Inc. v. Anthem Blue Cross & Blue Shield, 552 F.3d 430, 436
(6th Cir. 2008) (³[T]he critical issue for establishing a per se violation with the hub and spoke
system is how the spokes are connected to each other.´).  Because Plaintiffs fail to allege any

7 The cases Plaintiffs cite in support of their conclusory assertion that the alleged conspiracy is
among horizontal competitors are inapposite .  See In re Blue Cross Blue Shield Antitrust Litig.,
308 F. Supp. 3d 1241, 1260 (N.D. Ala. 2018) (requiring ³µan agreement¶ to commit conduct that
the Supreme Court has held to be unreasonable [per se] µbecause the unreasonableness of the
restraint is presumed¶´); United States v. Gen. Motors Corp., 384 U.S. 127, 145-46 (1966) (per
se rule applied to a group boycott among horizontally situated car dealers).
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13
horizontal agreement, Plaintiffs cannot rely on a hub-and-spoke theory to obtain per se
treatment.  Indeed, Plaintiffs fail to identify a single case where a hub-and-spoke conspiracy
lacked horizontal coordination, and still was determined to be illegal per se.  While they attempt
to rely on In re Disposable Contact Lens, the court there explained that the ³µrelevant agreement
in restraint of trade¶ was not [the hub¶s] vertical contracts with the [spokes], but rather µthe
horizontal agreement that [hub] organized among the [spokes] . . .¶ which was µper se
unreasonable.¶´  215 F. Supp. 3d at 1292.  The absence of such horizontal agreements
dispositively precludes per se treatment here.
2.
Plaintiffs Fail to Allege a Type of Horizontal Agreement That Is So
Plainly Anticompetitive That Per Se Treatment Is Appropriate.
Even if Plaintiffs had pleaded a horizontal restraint (they have not), the alleged
agreement does not fall within the limited set of circumstances where per se treatment is
warranted because Plaintiffs fail to allege the agreement is ³so plainly anticompetitive that no
elaborate study of the industry is needed to establish [its] illegality.´  Prof¶l Eng¶rs, 435 U.S. at
692.  Specifically, per se treatment is limited to ³naked restrain[ts] of trade with no purpose
except stifling of competition.´  Broad. Music, Inc. v. Columbia Broad. Sys., Inc., 441 U.S. 1, 20
(1979).  Examples of such practices are horizontal price fixing, output limitations, group
boycotts, and horizontal market division.  See Nat¶l Collegiate Athletic Ass¶n v. Bd. of Regents of
Univ. of Oklahoma, 468 U.S. 85, 100 (1984); Tempur-Pedic, 626 F.3d at 1334.
Plaintiffs have not asserted a price-fixing agreement, a group boycott or market
division.  And for the reasons addressed in Defendants¶ MTD, none of these characterizations are
applicable here.  (MTD at 28-30.)  Plaintiffs argue that this case involves a restriction of output.
(Opp. at 22.)  However, allegations that Defendants ³restrict[ed] retail investors¶ access to the
stock market´ do not amount to the type of ³output restriction´ with which the antitrust laws are
concerned.  Specifically, there is no allegation of ³product scarcity,´ nor that Defendants
³artificially inflate[d] prices by intentionally reducing product supply.´  United States v.
Andreas, 39 F. Supp. 2d 1048, 1059 (N.D. Ill. 1998), aff¶d, 216 F.3d 645 (7th Cir. 2000).
Plaintiffs appear to say that the relevant market is the market for the Relevant Securities.  (Opp.
at 31.)  Yet Plaintiffs do not (and cannot) plausibly assert that Defendants reduced output for any
of the Relevant Securities.  Critically, Plaintiffs do not (and cannot) allege that any of the trading
restrictions had any impact at all on the number of shares of the Relevant Securities available for
purchase and sale.  Thus, the per se standard does not apply.
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14
C.
Plaintiffs¶ Allegations Do Not Qualify for Quick Look Review.
Plaintiffs incorrectly suggest that the ³quick look´ standard of review should
apply to their claims.  (Opp. at 28.)  But ³[m]ost of the antitrust cases that have explicitly
considered a µquick look¶ approach involved restraints within the context of a joint venture,
professional association, network, or other joint association whose legitimacy was not in
question.´  Phillip Areeda & Herbert Hovenkamp, Antitrust Law ¶ 1508 (4th & 5th eds., 2021
Cum. Supp. 2013-2020).  None of those situations are alleged here.8
D.
Plaintiffs Fail to Plead a Section 1 Violation Based on the Rule of Reason.
Because Plaintiffs do not allege claims falling under the per se standard of review,
their claims must be analyzed under the rule of reason.  See Levine v. Cent. Fla. Med. Affiliates,
Inc., 72 F.3d 1538, 1546 (11th Cir. 1996) (³Agreements that do not fit within an established per
se category are analyzed under the µrule of reason,¶ i.e., courts will engage in a comprehensive
analysis of the agreement¶s purpose and effect to determine whether it unreasonably restrains
competition.´).  But for the reasons that follow, the CCAC must be dismissed because Plaintiffs
do not plead the requisite elements of a Section 1 claim proceeding under the rule of reason.
While Plaintiffs assert that the CCAC adequately alleges a product market (Opp.
at 31), nowhere do they define the relevant product market with any clarity.  The CCAC makes a
passing reference to ³the stock brokerage market with respect to the Relevant Securities´ (CCAC
¶ 498); and the Opposition refers at various points to ³markets in the Relevant Securities´ (Opp.
at 31), the ³securities market´ as a whole (id. at 18, 31), and the ³service´ of ³trading of
securities´ (id. at 31 n.33).  Those are four different potential markets (or more, if one treats each
Relevant Security as a separate market).  Furthermore, it is unclear whether, using the term
³securities market,´ Plaintiffs refer to the market for retail broker services, the market for
clearing services, the market for the Relevant Securities individually or in the aggregate, the
market for the Relevant Securities, the stock market as a whole, or any other type of market that
is encompassed by the financial markets.  And while Plaintiffs assert flatly that their argument is
that ³restricting purchasing shares in the Relevant Securities reduced competition´ (Opp. at 31),
they never articulate competition for what or between whom; indeed, Defendants are not alleged

8 Plaintiffs¶ own cases reject applying ³quick look´ to claims like theirs.  See California ex rel.
Harris v. Safeway Inc., 651 F.3d 1118, 1137 (9th Cir. 2011) (en banc) (rejecting ³quick look´
analysis because the ³limited duration´ of the restraint and ³the existence of other significant
external competitors in the market´ rendered any anticompetitive effects ³not obvious´).
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15
to ³compete´ with retail investors in trading the Relevant Securities.  (MTD at 5-6.)  Plaintiffs
also fail to grapple with the fact that the purchase or sale of securities of a particular company is
not covered by § 1 of the Sherman Act.  Kalmanovitz v. G. Heileman Brewing Co., 769 F.2d 152,
155-57 (3d Cir. 1985) (analyzing § 1 challenge to a tender offer).
Plaintiffs are also wrong as a matter of black-letter antitrust law when they try to
elide their pleading failures by arguing it is premature to assess market definition at the motion to
dismiss stage.  (Opp. at 21.)  As the Eleventh Circuit has held, ³antitrust plaintiffs . . . must
present enough information in their complaint to plausibly suggest the contours of the relevant
geographic and product markets.´  Tempur-Pedic, 626 F.3d at 1336 (affirming dismissal of rule
of reason case for, inter alia, failing to plead adequately the relevant market).
Plaintiffs¶ claim that American Express does not require a market definition at the
outset is astonishing.  (Opp. at 30.)9  The Supreme Court expressly rejected the plaintiffs¶
argument that they ³need not define the relevant market,´ even if plaintiffs had ³offered actual
evidence of adverse effects on competition.´  138 S. Ct. at 2285 n.7.  The Court explained that
³vertical restraints often pose no risk to competition unless the entity imposing them has market
power, which cannot be evaluated unless the Court first defines the relevant market.´  Id.  Thus,
as the Supreme Court explained, ³[w]ithout a definition of [the] market there is no way to
measure [the defendant¶s] ability to lessen or destroy competition.´  Am. Express Co., 138 S. Ct.
at 2285 (citations omitted).  Plaintiffs here must define the relevant market in which they allege
Defendants caused competitive harm, and plead that Defendants possessed market power within
that market.  Plaintiffs do not even attempt to do so.
Plaintiffs also do not allege that Defendants have market power in any market.
See PSKS, Inc. v. Leegin Creative Leather Prod., Inc., 615 F.3d 412, 418 (5th Cir. 2010)
(granting motion to dismiss, and holding that the market for ³women¶s accessories´ was ³too
broad and vague a definition to constitute a market,´ as it was ³impossible to imagine that [the
plaintiff] could have power over such a market´).  Nor could they; there are numerous other
electronic broker-dealer platforms, clearing brokers and market-makers.  Plaintiffs even allege

9 The very import of Amex was the Supreme Court¶s recognition for the first time that certain
markets must be defined to include two sides.  Plaintiffs¶ claim that the case somehow does not
require identifying at the outset the relevant product market is a gross misunderstanding of the
Supreme Court¶s latest antitrust case on market definition.
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that several of the named Plaintiffs sought to switch brokers to evade the restrictions, and
Plaintiff Minahan successfully did so.  (CCAC ¶ 30.)
Plaintiffs¶ failure to plead a relevant market also dooms their attempt to argue
they have adequately pleaded anticompetitive effects, as such effects can only be measured once
the relevant market has been defined.  See Tempur-Pedic, 626 F.3d at 1336.  And, in any event,
even if Plaintiffs had sufficiently pleaded that the prices for the Relevant Securities would have
been higher absent the disparate trading restrictions introduced by alleged conspirators and non-
conspirators alike, there is no allegation²nor could there be²that any such price effect was the
result of decreased competition, as the broker Defendants do not buy or sell the Relevant
Securities for their own account and therefore do not compete in any such market.  (See supra
Section II.B; MTD at 32.)  Despite multiple opportunities, Plaintiffs fail to plead the required
elements of the rule of reason test, and dismissal with prejudice is warranted.
III.
PLAINTIFFS¶ ANTITRUST CLAIMS ARE PRECLUDED BY FEDERAL
SECURITIES LAWS.
Plaintiffs¶ antitrust claims are precluded by federal securities law.
A.
The Dodd-Frank Act Savings Clause Does Not Apply.
Plaintiffs try to avoid preclusion of their claims by relying on the Dodd-Frank
Act¶s antitrust savings clause.  That reliance is misplaced.  As Plaintiffs acknowledge, Section 6
of the Dodd-Frank Act states that ³[n]othing in this Act, or any amendment made by this Act,
shall be construed to modify, impair, or supersede the operation of any of the antitrust laws,
unless otherwise specified.´  (Opp. at 32 (citing 12 U.S.C. § 5303) (emphasis added).)  ³[T]his
Act´ refers to the Dodd-Frank Act, not the Exchange Act, see Dodd-Frank Act §§ 1(a), 6, 124
Stat. 1376, 1390 (2010), and the savings clause is codified in title 12 (banks and banking), not
title 15 (where the securities laws appear).  See 12 U.S.C. § 5303.
The savings clause thus applies to conduct covered by the Dodd-Frank Act or
amendments made by that Act, but not conduct covered by pre-existing provisions of the
Exchange Act or other statutes otherwise unamended by the Dodd-Frank Act.  See In re Interest
Rate Swaps Antitrust Litig., 261 F. Supp. 3d 430, 495-98 (S.D.N.Y. 2017) (holding that Dodd-
Frank Act savings clause applied to alleged conspiracy among interest rate swap dealers, where
Act regulated swap markets); In re Credit Default Swaps Antitrust Litig., No. 13-md-2476, 2014
WL 4379112, at *16-17 (S.D.N.Y. Sept. 4, 2014) (same for credit default swaps).
The agreement among Defendants that Plaintiffs allege in this action, however,
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does not involve conduct covered by the Dodd-Frank Act.  As Plaintiffs characterize it, the
subject matter involves conduct covered by pre-existing market manipulation provisions of the
Exchange Act that the Dodd-Frank Act did not amend.  See Exchange Act § 15(c)(2)(D), 15
U.S.C. § 78o(c)(2)(D); Exchange Act § 9(a)(6), 15 U.S.C. § 78i(a)(6); Exchange Act § 10(b), 15
U.S.C. § 78j(b).  The Exchange Act provisions concerning broker risk mitigation and
management also were not amended by the Dodd-Frank Act.  (See infra Sec. III.B.)  Plaintiffs try
to shoehorn their claims into the Dodd-Frank Act¶s savings clause by asserting that provisions of
the Dodd-Frank Act ³touch upon issues alleged in the CCAC,´ namely short-selling.  (Opp. at
33.)  But the antitrust conspiracy that Plaintiffs allege in this case concerns trading restrictions
that ³Defendants simultaneously imposed . . . on their stock trading platforms,´ not any short-
selling activity.  (Id. at 1.)  Plaintiffs¶ (unsupported) suggestion that Citadel Securities¶ alleged
short sales provided a motive for the alleged conspiracy does not make short sales an object of
the conspiracy or bring this action within the ambit of the Dodd-Frank Act.  Indeed, Plaintiffs
acknowledge that their claims ³do not attack or seek to prohibit short selling generally.´  (Opp. at
39.)10  Moreover, Section 929X(a), on which Plaintiffs rely, authorizes the SEC to issue rules
regarding the public disclosure of short positions on a monthly basis.  124 Stat. at 1870.  The
SEC has not issued any regulations under the provision, and even if it had done so, they would
have nothing to do with the alleged conduct because they would not have prohibited short
selling, nor would such monthly disclosures have had any impact on Plaintiffs¶ claims.
Plaintiffs do not²and, as outlined in the MTD, cannot²show that the Dodd-
Frank Act or any of the amendments it made cover the trading restrictions at issue in this action;
therefore, the Act¶s antitrust savings clause does not apply.11  (MTD at 38.)  The Supreme
Court¶s analysis in Credit Suisse Sec. (USA) LLC v. Billing, 551 U.S. 264, 275 (2007), governs,
which holds that the general savings clauses in the Exchange Act are not ³so broad as to preserve

10 Plaintiffs note that ³Dodd-Frank also has specific provisions related to market making´
without explaining how this statement relates to the alleged antitrust conspiracy.  (Id. at 33.)  In
any event, as with short sales, Plaintiffs do not allege that Citadel Securities¶ market-making
activities were part of the alleged conspiracy.
11 Plaintiffs also argue that the Dodd-Frank Act modified portions of ³Section 15 of the
Securities Exchange Act´ without providing any explanation as to how this statement relates to
their case.  (Opp. at 33.)  As Defendants noted in the MTD, however, these amendments (see
Dodd-Frank Act § 913(g), 124 Stat. at 1828 (adding 15 U.S.C. § 78o(k)-(l)) have nothing to with
the provisions of the Exchange Act relevant to this action.  (MTD at 38.)
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all antitrust actions´ and do not prevent implied preclusion of Sherman Act claims.
B.
Plaintiffs¶ Antitrust Claims Are Precluded Under Billing Because the
Conduct at Issue Is Regulated by the Federal Securities Laws.
Plaintiffs¶ assertion that the four Billing factors do not apply entirely ignores that
other plaintiffs have brought claims alleging violations of federal securities laws on the facts
alleged here.  (See Order on Leadership Structure, ECF No. 310, at 1-2.)  The conduct
underlying Plaintiffs¶ claims is regulated by the securities laws, and Plaintiffs¶ antitrust claims
are accordingly precluded regardless of the merit of any securities claims.  Here, all four Billing
factors weigh in favor of preclusion.
1.
The Conduct at Issue Lies at the Very Heart of the Securities Market.
Plaintiffs argue that the first Billing factor weighs against preclusion because
³Defendants do not²and²cannot demonstrate how cutting off retail investors¶ access to the
securities market by restricting trading´ is ³central to the proper functioning of well-regulated
markets.´  (Opp. at 35-36.)  Plaintiffs¶ argument fails for two reasons.  First, Defendants showed
in their MTD that market integrity for stock prices, and the prohibition on market manipulation
of the kind Plaintiffs allege here, lies at the core of the securities laws.  See Exchange Act §§ 9-
10, 15 U.S.C. §§ 78i-78j; (MTD at 34).  Second, Defendants explained in the MTD how
restrictions on trading volatile stocks permitted certain Defendants to meet clearing agency
collateral calls and continue to serve all customers trading all securities (beyond the volatile
stocks).  (MTD at 17-18.)  That was central to the proper functioning of well-regulated markets.
The SEC has recognized this principle in the related context of requiring brokers with ³market
access´ to have risk management controls and supervisory procedures in place ³to systematically
limit the financial exposure of the broker or dealer that could arise as a result of [customer]
market access.´  17 C.F.R. § 240.15c3-5(c).  Specifically, such brokers must ³prevent the entry
of orders,´ and ³reject[] orders,´ if such orders would ³exceed appropriate pre-set credit or
capital thresholds in the aggregate for each customer and the broker or dealer.´  Id. § 240.15c3-
5(c)(1).  Indeed, the SEC has explicitly stated that broker-dealers ³may reserve the ability to
reject or limit customer transactions.´12  Accordingly, ³limit[ing] financial exposure´ by
implementing trading restrictions when necessary is a practice that ³lie[s] squarely within an area
12 SEC, Thinking About Investing in the Latest Hot Stock? (Jan. 30, 2021) (³SEC Statement´),
https://www.sec.gov/oiea/investor-alerts-and-bulletins/risks-short-term-trading-based-social-
media-investor-alert.
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 24 of 30

19
of financial market activity that the securities law seeks to regulate.´  Billing, 551 U.S. at 276.
2.
The SEC Is Authorized To Regulate All of the Activities in Question.
Plaintiffs further argue that the second Billing factor weighs against preclusion
because ³there are no provisions under SEC rules that allow brokers to unilateral[ly] restrict
access to trading markets.´  (Opp. at 36 n.39.)  Again, this is simply untrue.  As just outlined,
SEC rules explicitly require brokers with ³market access´ to have procedures in place to
unilaterally restrict access to trading markets.  17 C.F.R. § 240.15c3-5(c).  Moreover, as set forth
in the MTD, the SEC has the authority to enact regulations governing the market manipulation
that Plaintiffs allege here.  See Exchange Act §§ 9(a)(6) & 10(b), 15 U.S.C. §§ 78i(a)(6) &
78j(b); (MTD at 35, 37).  Thus, the SEC clearly has the ³regulatory authority under the securities
law to supervise the activities in question.´  Billing, 551 U.S. at 275.
3.
There Is Substantial Evidence That the SEC Is Exercising Its
Authority.
Curiously, Plaintiffs assert that ³there is simply no evidence to suggest that the
SEC is investigating the claims of concerted activity at issue here.´  (Opp. at 37.)  Plaintiffs¶
assertion is refuted by the acknowledgment earlier in their brief that the SEC is ³investigating the
events concerning the January 28, 2021 trading restrictions.´  (Id. at 18 n.20.)  As outlined in the
MTD, the SEC is exercising its authority through various enforcement programs, as is
demonstrated by the SEC¶s ongoing investigation.  (MTD at 35-36.)  The SEC may recognize
that Plaintiffs¶ claims of a conspiracy to manipulate the securities markets are baseless, but that
would be an entirely appropriate exercise of the SEC¶s authority.
4.
Allowing This Claim To Proceed Would Create a Conflict Between
the Antitrust and Securities Laws.
Plaintiffs assert that ³Defendants cite to no law that would be in conflict with or
undermined were Plaintiffs[¶] claims to succeed.´  (Opp. at 37-38.)  That is untrue.  Defendants
cited to the SEC¶s comprehensive regulations for broker-dealers (including net capital
requirements), see 17 C.F.R. §§ 240.15a-1 to 240.15c6-1, and for clearing agencies (including
collateral call requirements), see id. §§ 240.17Ab2-1 to -2, 240.17Ad-1 to -24.  (See MTD at 37.)
There is an actual conflict because Congress has expressly authorized these regulations.  See
Exchange Act §§ 15, 17 & 17A, 15 U.S.C. §§ 78o, 78q & 78q-1.  In any event, Billing does not
require an actual conflict.  See Billing, 551 U.S. at 273 (noting that in the Court¶s prior rulings on
this issue, ³in light of potential future conflict, the Court found that the securities law precluded
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 25 of 30

20
antitrust liability even in respect to a practice that both antitrust law and securities law might
forbid´). As Plaintiffs correctly note, a ³conflict may occur when there is either an actual
conflict or a potential conflict between antitrust law and securities regulations.´  (Opp. at 37
(citing Elec. Trading Grp., LLC v. Banc of Am. Sec. LLC, 588 F.3d 128, 137-38 (2d Cir. 2009))
(emphasis added).)  Here, SEC regulations do not prohibit the alleged conduct, and the SEC has
stated that broker-dealers ³may reserve the ability to reject or limit customer transactions.´13
Accordingly, there is an actual and potential conflict between the securities laws and the federal
antitrust laws in this action, and Plaintiffs¶ antitrust claims are precluded.
IV.
INDEPENDENT REASONS EXIST TO DISMISS ALL CLAIMS AGAINST
PEAK6, E*TRADE HOLDINGS AND ROBINHOOD MARKETS.
Other than conclusory statements in the Opposition, Plaintiffs do not allege that
PEAK6, E*TRADE Holdings or Robinhood Markets were involved in the alleged conspiracy²
just that parent-subsidiary relationships exist between these entities and other Defendants.  (Opp.
at 40.)  But courts reject that ³a subsidiary and its parent . . . can be considered one entity for all
§ 1 purposes, and either one can be liable for conspiring to restrain trade, even where there is no
evidence that both were involved in the challenged conduct.´  Fla. Cement, 746 F. Supp. 2d at
1324 (quoting Mitchael v. Intracorp, Inc., 179 F.3d 847, 857 (10th Cir. 1999)).  The claims must
be dismissed for this independent reason.14
V.
THE CCAC SHOULD BE DISMISSED WITH PREJUDICE.
Plaintiffs have filed two complaints after obtaining and reviewing thousands of
Defendants¶ internal documents.  Even with the benefit of documentary evidence ordinarily
unavailable at the pleading stage, Plaintiffs still fail to adequately plead a claim.  Any further
amendment would be futile; the CCAC should be dismissed with prejudice.  (MTD at 39.)
CONCLUSION
For the foregoing reasons, Defendants respectfully submit that the CCAC should
be dismissed for failure to state a claim, with prejudice.

13 SEC Statement, supra note 12.
14 Plaintiffs¶ citation to Lenox v. MacLaren Surgical Corp., 847 F.3d 1221 (10th Cir. 2017), does
not suggest otherwise.  The Tenth Circuit affirmed its decision in Mitchael, 179 F.3d at 857 (as
this Court cited in Florida Cement, 746 F. Supp. 2d at 1324), that a corporate parent cannot be
liable for a Section 1 claim under a Copperweld unitary entity theory absent allegations of the
parent¶s independent conduct.  Lenox, 847 F.3d at 1235.
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 26 of 30

Dated:  October 5, 2021
/s/ Samuel A. Danon

HUNTON ANDREWS KURTH LLP
Samuel A. Danon (FBN 892671)
Gustavo Javier Membiela (FBN 513555)
María Castellanos Alvarado (FBN 116545)
333 S.E. 2 Avenue, Suite 2400
Miami, FL 33131
Telephone: (305) 810-2500
Facsimile: (305) 810-2460
sdanon@huntonak.com
gmembiela@huntonak.com
mcastellanos@hunton.com

CRAVATH, SWAINE & MOORE LLP
Antony L. Ryan
Kevin J. Orsini
Brittany L. Sukiennik
825 Eighth Avenue
New York, NY 10019
Telephone: (212) 474-1000
Facsimile: (212) 474-3700
aryan@cravath.com
korsini@cravath.com
bsukiennik@cravath.com

Counsel for Defendants Robinhood Financial
LLC, Robinhood Securities, LLC and
Robinhood Markets, Inc.
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 27 of 30

/s/ Adam Hoeflich (with consent)

QUINN EMANUEL URQUHART & SULLIVAN,
LLP
Christopher D. Kercher
Peter H. Fountain
51 Madison Avenue, 22nd Floor,
New York, New York, 10010
Telephone: (212) 849-7000
Facsimile: (212) 849-7100
christopherkercher@quinnemanuel.com
peterfountain@quinnemanuel.com
QUINN EMANUEL URQUHART & SULLIVAN,
LLP
William A. Burck
1300 I Street NW, Suite 900
Washington, D.C. 20005
Telephone: (202) 538-8000
Facsimile: (202) 538-8100
williamburck@quinnemanuel.com
QUINN EMANUEL URQUHART & SULLIVAN,
LLP
John F. O¶Sullivan (FBN 143154)
2601 South Bayshore Drive, Suite 1550
Miami, FL 33133
Telephone: (305) 439-5008
johnosullivan@quinnemanuel.com
BARTLIT BECK LLP
Adam L. Hoeflich
Dawson Robinson
54 W. Hubbard St., Ste. 300
Chicago, IL 60654
Telephone: (312) 494-4400
Facsimile: (312) 494-4440
adam.hoeflich@bartlitbeck.com
dawson.robinson@bartlitbeck.com

Counsel for Defendant Citadel Securities LLC
/s/ Shari Ross Lahlou (with consent)

DECHERT LLP
Shari Ross Lahlou
1900 K Street, NW
Washington, D.C. 20006
Telephone: (202) 261-3300
Facsimile: (202) 261-3333
shari.lahlou@dechert.com
DECHERT LLP
Andrew J. Levander
Three Bryant Park
1095 Avenue of the Americas
New York, NY 10036
Telephone:  (212) 698 3500
Facsimile:  (212) 698 3599
andrew.levander@dechert.com
DECHERT LLP
Steven Bizar
Cira Centre
2929 Arch Street
Philadelphia, PA 19104
Telephone: (215) 994 4000
Facsimile: (215) 994 2222
steven.bizar@dechert.com
Counsel for Defendant Interactive Brokers
LLC
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 28 of 30

/s/ Peter W. Homer (with consent)

HOMER BONNER JACOBS ORTIZ, P.A.
Peter W. Homer (Florida Bar No. 291250)
1200 Four Seasons Tower
1441 Brickell Avenue
Miami, Florida 33131
Telephone: (305) 350-5139
Facsimile: (305) 372-2738
phomer@homerbonner.com
DAVIS POLK & WARDWELL LLP
Brian S. Weinstein
Gina Cora
Janet Jones-Duffey
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5972
brian.weinstein@davispolk.com
gina.cora@davispolk.com
janet.jones-duffey@davispolk.com
Counsel for Defendants E*TRADE Securities
LLC and E*TRADE Financial Holdings, LLC
/s/ J. Mark Gidley (with consent)
WHITE & CASE LLP
Jack E. Pace III
Bryan D. Gant
1221 Avenue of the Americas
New York, NY  10020-1095
Telephone: (212) 819-8200
Facsimile: (212) 354-8113
jpace@whitecase.com
bgant@whitecase.com
WHITE & CASE LLP
J. Mark Gidley
701 Thirteenth Street, NW
Washington, DC  20005-3807
Telephone: (202) 626-3600
Facsimile: (202) 639-9355
mgidley@whitecase.com
WHITE & CASE LLP
Angela Daker
Southeast Financial Center
200 South Biscayne Boulevard, Suite 4900
Miami, FL  33131-2352
Telephone: (305) 995-5297
Facsimile: (305) 358-5744
adaker@whitecase.com
Counsel for Defendant Apex Clearing
Corporation, Electronic Transaction Clearing,
Inc. and PEAK6 Investments LLC
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 29 of 30

CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on October 5, 2021, I electronically filed the foregoing
document with the Clerk of the Court using CM/ECF.  I further certify that the foregoing
document is being served this day on all counsel of record via transmission of Notices of
Electronic Filing generated by CM/ECF or in some other authorized manner for those counsel or
parties who are not authorized to receive Notices of Electronic Filing.

Dated:  October 5, 2021
/s/ Samuel A. Danon

Samuel A. Danon (FBN 892671)
Case 1:21-md-02989-CMA   Document 419   Entered on FLSD Docket 10/05/2021   Page 30 of 30

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