Bates White expert submits declaration in liquid fuel monopolization litigation
Approved Oil Co. of Brooklyn, Inc. and Sprague HP Holdings LLC are the top two distributors of liquid fuel to large institutional customers in New York City. These are the only two distributors with access to deepwater terminals in the city, which is crucial to maintain a smooth fuel supply to large institutional customers. Sprague owns its deepwater terminal. Approved Oil leased a storage terminal from a third company—Buckeye Partners LLP, the second largest and only other deepwater terminal in the city. Sprague acquired the terminal from Buckeye in 2023. Approved Oil continued to lease the terminal from Sprague under the terms originally negotiated with Buckeye. Sprague refused to extend Approved Oil’s terminal lease beyond 2025 and planned to shut the terminal down at the end of 2025. Without access to a liquid fuel terminal, Approved Oil will be required to purchase liquid fuel from another distributor, thus eliminating Approved Oil as a distributor and materially weakening its ability to compete with Sprague and other liquid fuel distributors in New York City.
In January 2025, Approved Oil filed suit, alleging that Sprague’s acquisition of the Buckeye Terminal was done with the intent of eliminating competition, foreclosing Approved Oil from access to a key asset it needed to remain competitive in the market. Approved Oil claimed it was a violation of Section 7 of the Clayton Act and Section 2 of the Sherman Act.
Nicholas Hill was retained on behalf of Approved Oil and submitted two declarations. His analysis showed that liquid fuel terminal access in New York City is a relevant antitrust market and Sprague’s acquisition of Buckeye terminal is presumptively anticompetitive under the Merger Guidelines in that market. Using publicly available data from the New York City government, he also showed that Sprague and Approved Oil compete closely to supply liquid fuel to the city. This competition will be lost if Approved Oil loses access to the liquid fuel terminal acquired by Sprague.
The case settled, allowing Approved Oil to have an extension of its lease on the terminal.
Dr. Hill was supported by a team including Naibin Chen, Randy Chugh, Mashfiqur Khan, and Adnan Mahmood.