JOHN DAY — A federal judge in Portland has dismissed an antitrust lawsuit against Iron Triangle and Malheur Lumber by a group of sawmill owners, logging contractors and timber owners who accused the defendants of engaging in anticompetitive business practices, although the decision leaves the door open for an amended complaint.

According to the judge’s 43-page opinion and order, dated Friday, Oct. 13, the plaintiffs failed to make a plausible case to support their monopolization claim in four alleged markets.

“Plaintiffs also fail to allege facts sufficient to support a Section 1 claim against Defendants Iron Triangle and Malheur Lumber because the alleged arrangement between Defendants is not an illegal conspiracy in restraint of trade,” according to the opinion and order by U.S. District Judge Marco Hernandez.

Filed Sept. 15, 2022, in U.S. District Court in Pendleton, the suit sought $117 million in damages from Iron Triangle LLC, Iron Triangle Logging and Russ Young, the owner of both companies, and from the Malheur Lumber sawmill in John Day.

It alleged that Iron Triangle used its 10-year stewardship contract with the Malheur National Forest to create a monopoly in four areas of business: timber sales, contract logging, the sawlog market and the stewardship services market.

The court is granting the plaintiffs 30 days to file amended claims related to the logging services market and the softwood sawlog market, but the order states they cannot plead monopoly or near-monopoly power in the stewardship services market or timber harvest rights market.

“(T)he U.S. Forest Service is precluded from being charged supra-competitive prices or selling timber below appraised value or minimum stumpage rates in these two markets respectively, and Defendant lacks the power to control prices or preclude other bidders,” according to the order. “These deficiencies cannot be cured and amendment would therefore be futile.”

Attorneys for the plaintiffs did not return a request for comment before press time.

Timothy Snider, attorney for the defendants, declined to comment on the ruling.

An earlier motion to dismiss by the defense argued that the plaintiffs failed to show that Iron Triangle has established a monopoly over any business within its market area.

The motion attacked the plaintiffs’ definition of the market as the Malheur National Forest and private timberlands in Grant County and the northern third of Harney County, arguing that a more realistic definition would include the neighboring Umatilla, Wallowa-Whitman and Ochoco national forests as well as lumber mills in Elgin, La Grande and Pilot Rock.

It also rejected the claim that a “diabolical tying arrangement” exists between Iron Triangle and Malheur Lumber that limits the ability of other businesses to buy logs from Iron Triangle or sell them to the Malheur mill.

The defendants’ attorneys also argued that the lawsuit improperly lumped Young and Iron Triangle Logging in with Iron Triangle LLC, claiming there is no factual basis to hold Young or Iron Triangle’s logging arm liable under federal antitrust laws.

The plaintiffs in the case include the Prairie Wood Products sawmill in Prairie City, Rude Logging, Morris Forestry, Engle Contracting, H Timber Contracting, Doug and Darell Emmel of the Emmel Brothers Ranch, and Pat and Heidi Voigt of the Ricco Ranch.