AG James Sues Intermountain for Buying Competitor and Shutting It Down to Reduce Competition
Greek Peak Mountain Owner to Pay $195,000 for Illegal Noncompete Agreements
New York Attorney General Letitia James on Friday took two actions to stop unlawful and monopolistic business practices by ski resort operators in Central New York. Attorney General James is suing Intermountain Management (Intermountain) for buying its main competitor, Toggenburg Mountain, then shutting it down to direct skiers to its own ski mountains. In addition, Attorney General James today ended an illegal agreement between the owner of Greek Peak Mountain (Greek Peak), John H. Meier, and Intermountain that prohibited Mr. Meier from competing with Intermountain or hiring any of its employees. As a result of a settlement with the Office of the Attorney General (OAG), Mr. Meier is required to pay $195,000 to the state and will cooperate with the litigation against Intermountain.
“Intermountain tried to freeze out competitors to increase its profits and dominate the region’s ski market. Today we are taking action to end these illegal arrangements and protect workers, skiers, and consumers. Monopolies are not a game. They harm consumers, drive up prices, and limit workers’ opportunities. Intermountain’s greedy behavior left skiers out in the cold all so they could line their own pockets and be on top of the ski market. Illegal and unfair practices by businesses big and small will not be tolerated by my office.”
– Attorney General James
In August 2021, John Meier, operator of Greek Peak Mountain, sold Toggenburg Mountain — a mainstay for Syracuse-area skiers and snowboarders — to its main competitor, Intermountain. Intermountain owns and operates the only other two ski resorts in the Syracuse area, Labrador and Song Mountains. The OAG lawsuit alleges that Intermountain only purchased Toggenburg to shut out competition, which was made clear when it immediately closed Toggenburg and announced that Toggenburg would not reopen for the upcoming season. Instead of continuing to operate Toggenburg, Intermountain suggested its customers drive to Labrador or Song Mountain, so that Intermountain could capture the additional sales. Intermountain also publicly announced that it would insert a deed restriction barring future buyers from using Toggenburg as a ski resort ever again, thereby asserting itself as the only ski operator in the Syracuse area.
The lawsuit alleges that Intermountain partners Peter Harris and Richard Sykes collaborated on the anticompetitive scheme to buy Toggenburg and establish their monopoly for years, approaching Mr. Meier repeatedly, inviting him to drinks at private social clubs, meals at local restaurants, and even staging a “faux buy” where they approached Mr. Meier through a third party. When Mr. Meier finally agreed to sell, Intermountain’s owners required him to agree that he would not compete with any of the Intermountain ski resorts, including Labrador and Song Mountains, for five years.
The noncompete agreement prohibited Mr. Meier from hiring any of Intermountain’s employees, from janitorial staff to ski lift operators, in what is known as a “no-poach” provision. No-poach agreements and provisions reduce competition for employees and disrupt normal wage-setting mechanisms, harming workers. The OAG’s investigation did not identify any reason for the no-poach provision and determined that its inclusion was unlawful. In addition to the agreement with Intermountain, Mr. Meier had entered into similar agreements with his former partner, Marc Stemerman, and E. James Hickey. The agreement with Mr. Stemerman contained a no-poach provision, and the agreement with Mr. Hickey had a geographic restriction that barred Mr. Hickey from competing within a 70-mile radius around Toggenburg. Ultimately, these illegal agreements harmed workers’ mobility and career choices.
The OAG ended these illegal agreements and Mr. Meier will pay $195,000 to the state, which is the amount he was paid by Intermountain for the agreement. Mr. Meier is also required to cooperate with OAG’s litigation against Intermountain.
As part of the lawsuit against Intermountain, Attorney General James is seeking to require Intermountain to sell one of its resorts and rescind its illegal noncompete agreement. In addition, Attorney General James is seeking monetary relief for the ill-gotten gains from Toggenburg customers forced to move to Intermountain, and civil penalties for Intermountain’s unfair and illegal business practices.
This matter and litigation are being handled by Assistant Attorneys General Benjamin J. Cole and Tal M. Elmatad of the Antitrust Bureau, under the supervision of Deputy Bureau Chief Amy McFarlane and Bureau Chief Elinor Hoffmann. The Antitrust Bureau is a part of the Division for Economic Justice, which is led by Chief Deputy Attorney General Chris D’Angelo and overseen by First Deputy Attorney General Jennifer Levy.