The Ninth Circuit Court of Appeals recently ruled in favor of Surgical Instrument Service Company, Inc. (SIS) in its antitrust case against Intuitive Surgical, Inc. (Intuitive). The court found that the lower court had erred by requiring SIS to prove specific legal factors known as the Kodak/Epic factors to establish its antitrust claims. This decision could significantly impact how antitrust cases are approached in the future, particularly in industries dominated by a single company.
This ruling affects not only SIS and Intuitive but also sets a precedent for similar cases involving monopolistic practices in the medical device industry. The decision emphasizes the importance of market power in antitrust claims and could lead to increased scrutiny of companies with substantial market shares.
Background
Surgical Instrument Service Company, Inc. is a family-run business that provides repair services for surgical instruments. The company entered into a dispute with Intuitive Surgical, a major manufacturer of surgical robots, particularly the da Vinci system, which is widely used in minimally invasive soft-tissue surgery.
The conflict arose when SIS began offering repair services for Intuitive's EndoWrist instruments, which are essential components of the da Vinci system. Intuitive holds a dominant position in the market, boasting over 99% market share for surgical robots and 100% for EndoWrist instruments. SIS alleged that Intuitive used its market power to stifle competition and prevent SIS from providing its repair services.
The case was filed in the Northern District of California in May 2021, where SIS claimed that Intuitive's actions constituted illegal tying and exclusive dealing under the Sherman Act. The trial began in January 2025, and SIS presented evidence of Intuitive's market dominance but did not provide proof of the Kodak/Epic factors, which the court later required for SIS's claims to proceed.
The Ruling
The Ninth Circuit, in its ruling filed on August 13, 2026, determined that the district court had made a mistake by instructing the jury that SIS needed to prove the Kodak/Epic factors to establish its claims. The court explained, "The Kodak/Epic factors apply only in cases where the plaintiff cannot show that the defendant possesses market power in the competitive foremarket." In this case, SIS had already demonstrated that Intuitive held significant market power.
The judges emphasized that SIS's claims were based on a standard foremarket/aftermarket tying theory, which does not require proof of the Kodak/Epic factors. The court rejected Intuitive's argument that it was entitled to judgment based on insufficient evidence, concluding that SIS had provided enough evidence for a reasonable jury to find that Intuitive had market power prior to SIS's entry into the market.
Impact
This ruling has significant implications for future antitrust cases, particularly those involving monopolistic practices in the medical device industry. The Ninth Circuit's decision clarifies that companies with substantial market power cannot impose additional burdens on plaintiffs seeking to prove their antitrust claims. This could empower smaller companies and service providers to challenge larger corporations that engage in anti-competitive practices.
The decision may also lead to increased scrutiny of companies like Intuitive Surgical, which dominate their respective markets. By reinforcing the importance of market power in antitrust claims, the ruling could encourage more businesses to pursue legal action against monopolistic behavior.
What's Next
Intuitive Surgical may seek to appeal this ruling, but details about any potential appeal were not available in the court filing. The outcome of this case could influence other pending antitrust cases involving similar market dynamics.