Federal Judge Sides With Fire Protection District in Antitrust Suit Brought by ADS
Alarm Detection Systems alleged the district and Tyco Integrated Security conspired to restrain or monopolize trade in the market for fire alarm monitoring.
In a lawsuit it filed in 2014, ADS alleged that the Orland Fire Protection District and Tyco Integrated Security had conspired to restrain or monopolize trade in the market for fire alarm monitoring.
CHICAGO — A federal judge has ruled in favor of a fire protection district, located in a southwest Chicago suburb, in an antitrust lawsuit that pitted Alarm Detection Systems (ADS) against Tyco Integrated Security, according to court documents.
In a lawsuit it filed in 2014, ADS alleged that the Orland Fire Protection District and Tyco Integrated Security had conspired to restrain or monopolize trade in the market for fire alarm monitoring.
The action underlying the case dates back to 2006, when the fire protection district adopted rules to require businesses in the district to install alarms compatible with its preferred system, which directly connected the alarms to the district’s central dispatch center.
According to court documents, as reported by cookcountyrecord.com, the fire protection district claimed such a direct connect system was “safer and more efficient.”
Although the district’s rules do not outright exclude ADS and other competitors from doing business with district, the program would require ADS to purchase equipment from Tyco to operate its alarms, and then rely on Tyco to transmit its alarm signals to the district’s 911 dispatch center.
ADS’s suit challenged the arrangement, asserting it “illegally precludes Alarm Detection from competing in the fire alarm monitoring business in Orland FPD.”
In his Aug. 2 ruling, U.S. District Court Judge Thomas Durkin ruled against ADS and in favor of the fire district and Tyco Integrated Security.
However, in his Aug. 2 ruling Durkin stated the Orland Fire Protection District has the statutory authority to require direct-connect fire alarm monitoring.
Durkin’s ruling continues:
“Further, Orland FPD’s power to contract under the District Act necessarily implies the authority to enter into exclusive contracts. Moreover, although a governmental entity’s decision to enter into an exclusive contract ‘inherently involves a kind of discrimination,’ it does not violate the Equal Protection Clause when government actors merely exercise their discretion.
“Thus, the mere fact that Orland FPD entered into an agreement with one fire alarm services company rather than another does not demonstrate a violation of the Equal Protection Clause.”
Durkin’s decision came after a bench trial on the lawsuit in 2017, and the filing of post-trial briefs in the case. Tyco has had an exclusive alarm monitoring contract since at least 2003, according to his ruling.
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