Sidley Helps Secure Complete Victory in Precedent-Setting Antitrust Litigation

On December 15, 2025, the U.S. Court of Appeals for the Third Circuit, entered a precedential opinion rejecting former limited partners’ antitrust claims against Cantor Fitzgerald, L.P., BGC Holdings, L.P., and Newmark Holdings, L.P. (together, “Cantor”) over forfeiture for competition provisions in the partnership agreements between these financial firms. The plaintiffs claimed that Cantor’s non-payment of the conditioned amounts after the plaintiffs obtained employment at competing firms violated federal antitrust laws. Third Circuit Judges Stephanos Bibas, Tamika R. Montgomery-Reeves, and Thomas L. Ambro ruled that the plaintiffs failed to link the non-payment of compensation allegedly due to any market-wide harm to competition. Writing for the court, Judge Montgomery-Reeves concluded that the plaintiffs’ allegations of market distortion were “at odds” with their own experiences, as they all successfully competed, and their generic allegations did not reflect any distortion to any relevant labor markets or that the provisions at issue restricted the supply of professionals available to other firms.

The Third Court’s decision affirmed a December 2024 victory in Delaware District Court, where Sidley and Cantor secured a rare Rule 12 dismissal of an antitrust class action that won Litigator of the Week. In that ruling, the court concluded that plaintiffs were complaining that they forfeited compensation by virtue of competing; this, Sidley argued, and the court agreed, did not constitute antitrust injury. The December 2024 decision followed another win for Sidley and Cantor earlier in 2024 before the Delaware Supreme Court regarding the same forfeiture-for-competition provisions, overturning a Court of Chancery decision that had invalidated the forfeiture-for-competition provision in Cantor’s partnership agreement.

With the Third Circuit win and prior wins in the Delaware District Court and Delaware Supreme Court, Sidley and Cantor have repeatedly defeated arguments that Cantor’s forfeiture for competition provisions are unlawful under Delaware state law and federal antitrust laws. The original case and this appeal were closely watched by financial services and other firms that rely on similar partnership provisions. For many years, there has been an effort to use the antitrust and other laws to invalidate labor-related restrictive covenants, including forfeiture-for-competition provisions. This case is the latest frontier for plaintiffs seeking to build upon the DOJ, Antitrust Division’s attacks on labor-related agreements. This case is of significant importance to the financial services sector because this new decision provides important support and antitrust guidance for firms, especially investment management firms, that use forfeiture-for-competition provisions.

These victories were secured by a multi-firm team of in-house and outside lawyers. The Sidley team was led by Benjamin Nagin (New York), co-leader of the firm’s global Antitrust and Competition group, and Tacy Flint (Chicago), and included James Horner (New York).

U.S. Court of Appeals for the Third Circuit: McLoughlin v. Cantor Fitzgerald L.P., No. 24-3346
Delaware District Court: McLoughlin et al. v. Cantor Fitzgerald, L.P. et al., Civil Action No. 23-CV-256-CFC
Delaware Supreme Court: Cantor Fitzgerald L.P. v. Brad Ainslie, et al., No. 162,2023