PENDLETON, Ore. — A $117 million federal antitrust lawsuit against two John Day-based businesses has been thrown out of court.

The Malheur Forest Fairness Coalition, comprising Grant County landowners, area logging outfits and the Prairie Wood Products sawmill, filed the suit Sept. 15, 2023, in the U.S. district court in Pendleton.

It accused the Iron Triangle logging company and Malheur Lumber mill of monopolizing the market for softwood sawlogs coming off the Malheur National Forest and surrounding private timberlands and conspiring to harm rival businesses through anticompetitive practices and restraint of trade.

Senior U.S. District Judge Marco Hernandez allowed the plaintiffs to amend their original complaint twice before dismissing the suit with prejudice, meaning it cannot be further amended and refiled.

Hernandez’s final ruling came Thursday, Sept. 19, two days after Grant County Circuit Court Judge Rob Raschio awarded Iron Triangle $652,000 — plus tens of thousands more in interest and legal fees — in its suit against Prairie Wood Products for failing to pay for white fir logs delivered under contract to the Prairie City sawmill.

In his written opinion, Hernandez ruled the coalition failed to make a compelling case for either monopolization or restraint of trade, offering “vague allegations” without adequate evidence to move forward to trial.

Instead, the judge wrote, the plaintiffs had expressed dissatisfaction with what they perceived as Iron Triangle’s privileged position in the local timber industry.

“At its core, this case is about the U.S. Forest Service’s decision to grant defendant Iron Triangle a 10-year stewardship contract for the Malheur National Forest along with associated logging rights,” Hernandez asserted in his opinion.

“In their second amended complaint, plaintiffs continue to complain of various harms that stem from this contract and ask that the court order the U.S. Forest Service — who is not a party to this case — to approach the stewardship contract differently.”

Iron Triangle was the winning bidder for the long-term contract, which gave it rights to 70% of the timber harvest coming off the Malheur. The deal, valued at an estimated $69 million, expired in 2023 and has not been renewed.

The stewardship contract has been widely credited with saving what was then Grant County’s last remaining wood products mill, Malheur Lumber, by providing a steady stream of sawlogs while also creating hundreds of jobs and improving forest health. But the arrangement has also drawn bitter criticism from those who say it allowed Iron Triangle to prosper at the expense of competing operators.

The timber industry has been in steep decline throughout the Pacific Northwest for decades, battered by a variety of factors including restrictions on logging on public lands.

Now, as it was in 2013, Malheur Lumber once again is in danger of closing, although its owners have pointed to labor shortages and market conditions rather than timber supply as the driving factors.

Prairie Wood Products also is in difficult straits. The company — which reopened in July 2022 after a 15-year hiatus — suspended operations and laid off most of its workforce March 1, citing a dispute with the Forest Service over a grant for transporting logs. The company says it plans to reopen but has had a difficult time finding parts to repair critical equipment.

“It is noteworthy that the courts have found all of the lawsuits brought against Iron Triangle and Malheur Lumber Co. to be without any merit,” said King Williams, a spokesman for Iron Triangle.

“The end result is that they have sewn division based on false accusations within our community that will be difficult to heal and the worst is that Malheur Lumber is closing. The local circuit court and the U.S. federal court have both ruled there has been no basis for these destructive lawsuits.”

Attorneys for the Malheur Forest Fairness Coalition did not respond to an email asking if they intended to appeal Hernandez’s decision in the antitrust case or wished to comment on behalf of their clients.

In addition to Prairie Wood Products, other plaintiffs in the lawsuit were Rude Logging; Brett Morris; Morris Forestry; Engle Contracting; H Timber Contracting; Doug Emmel and Darrell Emmel, doing business as Emmel Brothers Ranch; and Pat Voigt and Hedy Voigt, doing business as Ricco Ranch.