In the

United States Court of Appeals

For the Seventh Circuit ____________

No. 05-3601

JAY REIFERT,

Plaintiff-Appellant,

v.

SOUTH CENTRAL WISCONSIN MLS CORPORATION,

REALTORS ASSOCIATION OF SOUTH CENTRAL

WISCONSIN, INC., ROBERT L. COURTER, SUSAN

MATTHEWS, DAVID STARK, ROBERT WEBER,

THOMAS BUNBURY, MAURICE W. HILL, PETER SVEUM,

MARSHALL ZWYGART, and DAVID MCGRATH,

Defendants-Appellees.

____________

Appeal from the United States District Court

for the Western District of Wisconsin.

Case No. 04-C-0969-S—John C. Shabaz, Judge.

____________

ARGUED FEBRUARY 17, 2006—DECIDED JUNE 12, 2006

____________

Before FLAUM, Chief Judge, and KANNE and WOOD,

Circuit Judges.

FLAUM, Chief Judge. Plaintiff-Appellant Jay Reifert

claims that the defendants violated the Sherman Act by

tying access to a real estate multi-listing service (“MLS”) to

membership in a Realtors Association. The district

court granted summary judgment for all defendants in

this case, finding no competition in the tied market and

therefore, no antitrust violation.
2 No. 05-3601

1 “Realtors Associations” are organizations affiliated with the

National Association of Realtors and have agreed to abide by the

NAR Code of Ethics. RASCW is an example of a local Realtors

Association.

For the following reasons, we now affirm the judgment of

the district court.

I. Background

Realtors Association of South Central Wisconsin, Inc.

(“RASCW”) is a real estate trade association. Its members

are real estate agents and appraisers in and around

Madison, Wisconsin. RASCW offers a variety of products

and services to its members, including lobbying, social

functions, courses, referral programs, contract forms,

conventions, publications, and legal information.

RASCW is associated with the Wisconsin Realtors

Association and the National Association of Realtors

(“NAR”). When a person pays membership dues to an

association affiliated with NAR, that person becomes a

member of NAR. Normally, Realtors Association1

 memberships are packaged as a group including local, state, and

NAR memberships.

RASCW owns 100% of the stock in the South Central

Wisconsin MLS Corp. (“SCWMLS”). The MLS or multiple

listing service is a computerized database of homes and

properties listed for sale by SCWMLS participants in southcentral Wisconsin. Access to this multiple listing service is a

necessity for real estate agents and appraisers in this area.

Virtually all active residential real estate agents in the

region subscribe to SCWMLS. Users are charged a quarterly fee to gain access to the full database and must be a

member of a Realtors Association affiliated with NAR. The

Realtors Association membership requirement has existed
No. 05-3601 3

for more than fifty years. Generally, any licensed real estate

professional who agrees to abide by the NAR Code of Ethics

and pays the applicable fees is admitted.

Article 16 of NAR’s Code of Ethics contains a “non-solicitation” rule. This article and the related standards of practice

prohibit members from inducing sellers to breach listing

contracts, advising sellers of superior services or prices

during the time they are under contract with another

Realtor, and using “information received through a Multiple

Listing Service . . . to target clients of other Realtors®.”

A member-elected board of directors sets dues for

RASCW. Fees for SCWMLS are also set by members elected

to a board of directors. Both organizations set their fees

solely to cover operational costs, with no profit-making

intent. Annual dues to join the NAR, Wisconsin Association

of Realtors, and RASCW are approximately $449 a year.

The plaintiff, Jay Reifert, brings three claims against

SCWMLS, RASCW, and the directors of SCWMLS. First, he

alleges that SCWMLS unlawfully ties its services to

RASCW. Second, Reifert alleges that by conditioning access

to MLS service on membership in RASCW, an unlawful

group boycott has occurred. Finally, Reifert alleges that

Article 16 of the NAR Code of Ethics violates the Section I

of the Sherman Act, 15 U.S.C. § 1, by prohibiting competition.

Reifert, is a residential real estate broker, exclusively

representing buyers of real estate in south central Wisconsin. Reifert has been a member of RASCW (or its predecessor) and a participant in SCWMLS (or its predecessor) since

1988. Reifert belongs to the National Association of Exclusive Buyer’s Agents (“NAEBA”) and has no desire to

maintain membership in RASCW or the state and national

Association of Realtors. Reifert objects to the fees he is

forced to pay for unwanted services and the Code of Ethics

he must follow to maintain his membership in RASCW and

NAR.
4 No. 05-3601

Reifert claims that during the four years at issue in this

action, he has paid dues in excess of $2000 for an unwanted

RASCW membership to maintain his SCWMLS access.

During the relevant four-year period, there have been

approximately 2,079 annual and 5,600 total SCWMLS

participants.

To support an antitrust action, a plaintiff must demonstrate that the defendant’s actions have restrained competition. Section I of the Sherman Act states, “Every contract,

combination in the form of trust or otherwise, or conspiracy,

in restraint of trade or commerce among the several States

. . . is declared to be illegal.” 15 U.S.C. § 1. The Supreme

Court has long recognized that Congress intended to outlaw

only “unreasonable restraints,” not all contracts in restraint

of trade. See State Oil Co. v. Khan, 522 U.S. 3, 10 (1997)

(citations omitted). The Clayton Act allows for private suits

by individuals injured by violations of antitrust laws. See 15

U.S.C. §§ 15, 26.

On August 25, 2005, the district court granted summary

judgment to the defendants and denied summary judgment to the plaintiff. A tying arrangement violates federal

antitrust statutes if it has a substantial effect on interstate

commerce. The district court found that “there is insufficient evidence for a fact finder to find that a tie between the

defendant’s multiple listing service and Realtor membership has had an effect on interstate commerce as that

element has been defined by the Supreme Court.”

As to Reifert’s group boycott claim, the district court

again found that the plaintiff had failed to prove any anticompetitive effects resulting from the tying of Realtors

Association memberships to MLS services. Accordingly, the

district court granted summary judgment to the defendants.
No. 05-3601 5

II. Discussion

We review a district court’s grant of summary judgment

de novo, taking all facts in the light most favorable to the

non-moving party. See, e.g., McCoy v. Harrison, 341 F.3d

600, 604 (7th Cir. 2003) (citations omitted). An award of

summary judgment is proper when “there is no genuine

issue as to any material fact and that the moving party is

entitled to a judgment as a matter of law.” FED. R. CIV. P.

56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).

A. Tying Claim

Reifert claims that the defendants have engaged in an

unlawful tying arrangement by limiting SCWMLS access to

members of a Relators Association. Thus, the alleged “tying

product” is SCWMLS and the alleged “tied product” is

membership in a Realtors Association.

In determining whether a violation of Section I of the

Sherman Act, 15 U.S.C. § 1, has occurred as a result of a tie

between two products or services, this Court requires the

plaintiff to prove four elements. See Carl Sandburg Vill.

Condo. Ass’n No. 1 v. First Condo. Dev. Co., 758 F.2d 203,

208 (7th Cir. 1985) (citing imposition of the “economic

interest requirement . . . by courts in the Second, Third,

Fourth, Fifth, Sixth, Ninth, and Eleventh Circuits”).

In order to establish the per se illegality of a tying

arrangement, a plaintiff must show that: (1) the tying

arrangement is between two distinct products or

services, (2) the defendant has sufficient economic

power in the tying market to appreciably restrain free

competition in the market for the tied product, and (3)

a not insubstantial amount of interstate commerce is

affected. [ N. Pac. Ry. Co. v. United States, 356 U.S. 1,

5-6 (1958)]; Moore v. Matthews & Co., 550 F.2d 1207,

1212 (9th Cir. 1977). In addition, this circuit has held
6 No. 05-3601

2 We agree with our concurring colleague that a cautious

approach is always appropriate when anticipating future Supreme

Court actions. In 1985, our Circuit began to incorporate the rule

of reason in our tying analysis. At that time, we stated that,

“According to the Supreme Court, a plaintiff’s failure to state a

per se illegal antitrust claim does not necessarily prove fatal to his

case if he can state a claim under the rule of reason.” Carl

Sandburg Vill. Condo. Ass’n No. 1, 758 F.2d 203, 210 (7th Cir.

1985) (citing Fortner Enter., Inc. v. United States Steel Corp., 394

U.S. 495, 499-500 (1969); Warner Mgmt. Consultants, Inc. v. Data

Gen. Corp., 545 F. Supp. 956, 966 (N.D. Ill. 1982)); see also

Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 35 (1984)

(O’Connor, J., concurring) (“The time has therefore come to

(continued...)

that an illegal tying arrangement will not be found

where the alleged tying company has absolutely no

economic interest in the sales of the tied seller, whose

products are favored by the tie-in. Ohio-Sealy Mattress

Mfg. Co. v. Sealy, Inc., 585 F.2d 821, 835 (7th Cir.

1978), cert. denied, 440 U.S. 930 (1979); Warner Mgmt.

Consultants, Inc. v. Data Gen. Corp., 545 F.Supp. 956,

967 (N.D.Ill. 1982).

Id. at 207-08.

Following this precedent, the district court correctly

required Reifert to prove the following four elements of a

tying violation: (1) a tie exists between two separate

products; (2) the tying seller (SCWMLS) has sufficient

economic power in the tying product market to restrain free

competition in the tied product market (Realtors Association memberships); (3) the tie affects a not-insubstantial

amount of interstate commerce in the tied product (Realtors

Association memberships); and (4) the tying seller

(SCWMLS) has some economic interest in the sales of the

tied product (Realtors Association memberships). Id. at

207.2
No. 05-3601 7

2 (...continued)

abandon the ‘per se’ label and refocus the inquiry on the adverse

economic effects, and the potential economic benefits, that the

tie may have.”). In a related area, the Supreme Court recently

adopted Justice O’Connor’s reasoning in Jefferson Parish Hosp.

Dist. No. 2 and held that tying arrangements involving patents

should be evaluated based upon their market power “rather than

under the per se rule.” Ill. Tool Works, Inc. v. Indep. Ink, Inc., 126

S.Ct. 1281 (2006). Although the per se analysis of the Jefferson

Parish Hosp. Dist. No. 2 majority has not been expressly overruled, in the intervening twenty-one years since Carl Sandburg

Vill. Condo. Ass’n No. 1, the Supreme Court has not found

occasion to disagree with this Circuit’s approach.

There is no question that Reifert has satisfied the requirements for the first two elements. First, access to the multilisting service cannot be obtained without purchasing the

tied product, a Realtors Association membership. Second,

SCWMLS has sufficient market power to restrain free

competition in the tied product market.

SCWMLS is a unique product. Nearly every available

home in the relevant geographic area is listed on the

service. The near-perfect market information created by

SCWMLS is the result of a requirement that members place

all listings in the MLS within five days. The MLS allows

individuals with access to search and filter properties based

upon detailed criteria including compensation offered to

buyers’ agents, detailed property information, neighborhood

information, prior sales history, offers made on the property, days on the market, and the sale price of comparable

homes. The features and information available through

SCWMLS are not available through any other service. In

addition, the MLS service targets a different audience—real

estate agents and appraisers—than free listing services or

newspapers. In short, it is impossible to perform the tasks

of a real estate agent or appraiser in the relevant geo-
8 No. 05-3601

graphic area without using SCWMLS. Thus, it possesses

sufficient market power to restrain competition.

The third element of the Sandburg test states that a tying

arrangement violates antitrust law only if “a substantial

volume of commerce is foreclosed” because of the tie.

Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 16

(1984). This element can be broken into two sub-questions:

(1) Is there at least one competitor in the tied product

market other than the favored seller; and (2) Is the quantity

of interstate commerce affected not-insubstantial?

The district court found no competition in the allegedly

tied market for Realtors Association memberships. Where

there is no competition in the tied market, there can be no

antitrust violation. Forcing a buyer to purchase a product

he otherwise would not have purchased is insufficient to

establish the foreclosure of competition. Id. (“[W]hen a

purchaser is ‘forced’ to buy a product he would not have

otherwise bought even from another seller in the tied

product market, there can be no adverse impact on competition because no portion of the market which would otherwise have been available to other sellers has been foreclosed.”).

Despite Reifert’s desire to avoid purchasing a Realtors

Association membership, without evidence of competitors in

the market for services offered by the Realtors Association,

there can be no foreclosure of competition. See Ohio-Sealy

Mattress Mfg. Co. v. Sealy, Inc., 585 F.2d 821, 835 (7th Cir.

1978); 9 PHILLIP E. AREEDA & HERBERT HOVENKAMP,

ANTITRUST LAW ¶ 1723a (2d ed. 2004) (“When there are no

rival sellers of the tied product to be foreclosed, then the

alleged tie-in might affect a substantial volume of commerce

in the tied product and yet not foreclose anyone.”). The

district court correctly found that despite the “laundry list

of entities” submitted by the plaintiff, there were no

competitors in the tied product market.
No. 05-3601 9

Products and services are in the same market when they

are good substitutes for one another. “The outer boundaries

of a product market are determined by the reasonable

interchangeability of use or the cross-elasticity of demand

between the product itself and substitutes for it.” Brown

Shoe Co. v. United States, 370 U.S. 294, 325 (1962).

This Court requires that a plaintiff prove that products

are good substitutes using economic evidence; a conclusory

assumption of competition where products or services

appear to be similar is insufficient. See Menasha Corp. v.

News Am. Mktg. In-Store, Inc., 354 F.3d 661, 664 (7th Cir.

2004). Actual data and a reasonable analysis are necessary

to demonstrate that a product or service is a good substitute

for another. “Economics, like the other social sciences, has

its share of counterintuitive findings, so observing things

that to the untutored eye seem to be substitutes need not

mean that they are good substitutes.” Id.

Other federal courts have held that conditioning access to

a multi-listing service on membership in a Realtors Association is not indicative of an unlawful tying arrangement. See

Wells Real Estate, Inc. v. Greater Lowell Bd. of Realtors, 850

F.2d 803 (1st Cir. 1988); O’Riordan v. Long Island Bd. of

Realtors, Inc., 707 F. Supp. 111 (E.D.N.Y. 1988); Buyer’s

Corner Realty, Inc. v. No. Ky. Ass’n of Realtors, 410 F. Supp.

2d 574 (E.D. Ky. 2006). One federal court has held that a

tied real estate association group faced competition and

therefore created an unlawful tie; as explained below,

however, we find that case distinguishable. See Thompson

v. Metro. Multi-List, Inc., 934 F.2d 1566 (11th Cir. 1991).

Reifert argues that by comparing participation in Realtors

Associations in areas where MLS services are “open” to

individuals who have not joined a Realtors Association with

so called “closed” areas that require membership in a

Realtors Association, he can demonstrate that agents have

been forced to purchase Realtors Association memberships.

This comparison is unreliable, however, because it fails to
10 No. 05-3601

speak to the central question of whether a competitor exists

in this particular “closed” market and does not account for

other possible explanations for the observed differences.

Forcing individuals in Reifert’s position to purchase a

product they do not want is not a violation of antitrust law.

See Jefferson Parish Hosp. Dist. No. 2, 466 U.S. at 16.

Even without an economic analysis, it is apparent that

RASCW lacks competition. Each of the twelve organizations

cited by Reifert fails to qualify as a competitor to the

national or local Realtors Association:

1. Appraisal Institute (AI)- covers only appraisers

2. Asian Real Estate Agent Association (AREAA)—serves

a distinct ethnic community

3. Chinese American Real Estate Professionals Association (CAREPA)—serves a distinct ethnic community

4. Chinese Real Estate Association of America

(CREAA)—serves a distinct ethnic community

5. Colorado Association of Exclusive Buyer Agents

(CAEBA)—covers only exclusive buyer agents

6. Massachusetts Association of Buyer Agents

(MABA)—covers only exclusive buyer agents

7. National Association of Exclusive Buyer Agents

(NAEBA)—covers only exclusive buyer agents

8. National Association of Independent Fee Appraisers

(NAIFA)—covers only appraisers

9. National Association of Hispanic Real Estate Professionals (NAHREP)—serves a distinct ethnic community

10. National Association of Independent Real Estate

Brokers (NAIREB)—serves only independent brokers

11. National Association of Real Estate Appraisers

(NAREA)—covers only appraisers
No. 05-3601 11

12. National Association of Real Estate Brokers

(NAREB)—primarily devoted to the needs of minority

brokers

The district court relied heavily upon the First Circuit’s

decision in Wells Real Estate. We believe that decision

effectively captured the central flaw in Reifert’s argument.

[The plaintiff] has failed to demonstrate the slightest

market for membership in real estate boards that might

have been affected by the defendants’ alleged tying

arrangement. There is no evidence that any other

broker would have “purchased” membership in any

other board but for the power exerted by the lure of the

defendants’ MLS. There is no evidence that a substantial volume of “commerce” in board membership was

foreclosed by the tie-in. The tying claim must fail

absent any proof of anti-competitive effects in the

market for the tied product.

Wells Real Estate, Inc., 850 F.2d at 815 (footnotes omitted).

While the organizations the plaintiff named may provide

important services, they simply do not compete with

RASCW or any other Realtors Association. These niche

associations lack cross-price elasticity with the national and

local Realtors Associations, and have dissimilar purposes.

These organizations are unlikely substitutes for a Realtors

Association in Wisconsin.

Instead of providing the district court with the required

economic analysis, Reifert employs a 30-year old decision

from this Court, Beatrice Foods Co. v. FTC, 540 F.2d 303,

308 (7th Cir. 1976), to frame his discussion of competition.

Beatrice Foods Co. relied upon the Supreme Court’s decision in Brown Shoe Co., 370 U.S. at 325, and set forth

several “practical indicia” to determine a market’s boundaries. “These indicia are (1) the industry or public recognition of the submarket as a separate economic entity, (2) the
12 No. 05-3601

product’s peculiar characteristics and uses, (3) unique

production facilities, (4) distinct customers, (5) distinct

prices, (6) sensitivity to price changes, and (7) specialized

vendors.” Beatrice Foods Co., 540 F.2d at 308. While the

“practical indicia” named in Brown Shoe and Beatrice Foods

Co. are important considerations in defining a market, they

were never intended to exclude economic analysis altogether. Both opinions recognized the importance of economic analysis, including cross-price elasticity of demand.

See Brown Shoe, 370 U.S. at 325 (“The outer boundaries of

a product market are determined by the reasonable

interchangeability of use or the cross-elasticity of demand

between the product itself and substitutes for it.”); see also

Beatrice Foods Co., 540 F.2d at 308.

This Court has emphasized the use of economic analysis

in the law. To demonstrate competition in an antitrust case,

the plaintiff must provide an economic analysis of the

relevant market. See, e.g., Menasha, 354 F.3d 661 (requiring

economic evidence to prove the existence of a distinct

market). Lacking any economic evidence, Reifert has failed

to show that the tying arrangement has foreclosed any

portion of the market for real estate services.

The facts of the instant case stand in contrast to the

situation analyzed by the Eleventh Circuit in Thompson.

The defendants in Thompson operated an MLS system and

tied MLS access to membership in a Realtors Association.

The Plaintiff, Empire Real Estate Board, was “founded in

1939 as an African American professional association

because, at that time, the Realtors [Association] excluded

African Americans from membership.” Thompson, 934 F.2d

at 1570. The plaintiffs proved that as a result of the tie and

the prohibitive cost of joining two groups, 400 brokers either

did not join or quit the Empire Real Estate Board. Thompson held that where a competitor offering similar services

loses four hundred members because of a tie between an

association of real estate agents and an MLS service, there
No. 05-3601 13

has been a substantial effect on interstate commerce. Id. at

1578. In our case, however, the plaintiff has not presented

an organization equivalent to Empire Real Estate Board.

Thompson presented a valid competitor; neither Wells nor

the instant case does. Thus, Thompson demonstrated a

substantial effect on interstate commerce, while Reifert has

not.

Having found no competitors, there are many issues

raised in the parties’ briefs that we need not reach. We need

not decide whether the quantity of interstate commerce

affected is “not-insubstantial,” nor must we address

whether SCWMLS has a sufficient economic interest in

the sales of the tied product to satisfy the fourth element of

an unlawful tying arrangement.

B. Group Boycott Claim

Reifert also asks this Court to consider the district court’s

grant of summary judgment to the defendants on his group

boycott claim. A group boycott traditionally occurs when a

particular group or individual is prohibited from joining an

organization. “Where there are no exclusionary conditions

attached to Realtor board membership, and there is no

contention that the cost is prohibitively high, it is difficult

to see any affront to competition.” Pomanowski v.

Monmouth County Bd. of Realtors, 446 A.2d 83, 92 (N.J.

1982). In the instant case, no licensed real estate agent was

denied access to SCWMLS because of an anti-competitive

measure.

To prove a group boycott, a plaintiff must establish that

the membership requirement has had an adverse impact

upon competition in the market for the tied product. As

stated above, Reifert has failed to demonstrate the existence of a competitive market for Realtors Association

memberships. Thus, there is no need to balance the procompetitive effects of the Realtors Association membership
14 No. 05-3601

requirement against its anti-competitive effects. See Buyer’s

Corner Realty, Inc., 410 F. Supp. 2d at 583-84 (citing

O’Riordan, 707 F. Supp. at 116).

C. Anti-Competitive Effects of the Code of Ethics

Reifert claims that Article 16 of the Code of Ethics of the

National Association of Realtors is anti-competitive and

violates Section I of the Sherman Act, 15 U.S.C. § 1. Article

16 prohibits members of the National Association of

Realtors from interfering with the exclusive agreements

other members have established with clients.

Reifert’s allegations concerning the anti-competitive

effects of Article 16, however, are overly broad. As the

National Association of Realtors, Code of Ethics Standard

of Practice 16-2 states, “Article 16 does not preclude

Realtors® from making general announcements to prospects

describing their services[.]” Rather, the Article’s purpose is

to prevent the targeted solicitation of individuals who have

exclusively listed their property with another agent and to

prevent agents from improperly using multiple listing

services as a data bank of potential customers.

We must review a challenge to Article 16 under the rule

of reason to determine whether the agreement contributes

to competition and productivity. See Nat’l Soc’y of Prof’l

Eng’rs v. United States, 435 U.S. 679, 695 (1978). Under the

rule of reason, Reifert had the burden to demonstrate that

Article 16’s net effect was anti-competitive. See Bi-Rite Oil

Co. v. Ind. Farm Bureau Co-op. Ass’n, Inc., 908 F.2d 200,

203 (7th Cir. 1990).

The balance between pro- and anti-competitive effects

weighs heavily in favor of Article 16. Even in “open” MLS

areas such as Massachusetts and Alaska, where individuals

who have not joined a Realtors Association may access an

MLS service, users must agree not to solicit the exclusive
No. 05-3601 15

listings of other MLS users during the term of the listing.

If agents were reluctant to post their listings, for fear that

other agents would steal their clients, the market would

become less transparent and less efficient. Article 16 aids

competition and fulfills the purposes of the Sherman Act by

providing a more transparent marketplace.

III. Conclusion

For the foregoing reasons, the judgment of the district

court is AFFIRMED.

WOOD, Circuit Judge, concurring in the judgment.

Although I agree without reservation with the majority’s

conclusion that the district court correctly granted summary

judgment for the defendants in this case, I am concerned

that some aspects of its opinion are in tension with the

governing Supreme Court doctrine on tying arrangements.

For the reasons I explain briefly here, I would take a more

cautious approach, and leave further developments in tying

law to the high court.

In Northern Pacific Ry. Co. v. United States, 356 U.S. 1

(1958), the Supreme Court defined a tying arrangement

as “an agreement by a party to sell one product but only

on the condition that the buyer also purchases a different

(or tied) product, or at least agrees that he will not purchase

that product from any other supplier.” Id. at 5-6. As the

Court later made clear in Jefferson Parish Hospital Dist.

No. 2 v. Hyde, 466 U.S. 2 (1984), however, “every refusal to
16 No. 05-3601

sell two products separately can not be said to restrain

competition.” Id. at 11. The trick is to distinguish between

tying arrangements that are invalid and those that are

innocuous, from a competitive standpoint. In Jefferson

Parish, the Court explained the difference as follows:

Our cases have concluded that the essential characteristic of an invalid tying arrangement lies in the

seller’s exploitation of its control over the tying product

to force the buyer into the purchase of a tied product

that the buyer either did not want at all, or might have

preferred to purchase elsewhere on different terms.

When such “forcing” is present, competition on the

merits in the market for the tied item is restrained and

the Sherman Act is violated.

Id. at 12. Going on, over the objection of Justice O’Connor

(who concurred in the judgment because of this point), the

majority had this to say about the analytical approach

toward tying arrangements:

Per se condemnation—condemnation without inquiry

into actual market conditions—is only appropriate if

the existence of forcing is probable. Thus, application of

the per se rule focuses on the probability of

anticompetitive consequences.

Id. at 15-16. The Court went on to describe the circumstances under which that probability would exist: first,

there must be a substantial potential for impact on competition, which would be shown if a substantial volume of

commerce is foreclosed by the arrangement; second,

anticompetitive forcing must be likely, which is the case

when it is probable that the seller has market power. Id. at

16-17. If the seller does not have “either the degree or the

kind of market power that enables him to force customers

to purchase a second, unwanted product in order to obtain

the tying product,” then the per se rule cannot be used and
No. 05-3601 17

the arrangement must be assessed under a full rule of

reason. Id. at 18.

Despite Justice O’Connor’s forceful opinion concurring

in the judgment, in which she argued that the time had

come to jettison the per se rule in tying cases, see id. at 35,

and despite the opportunity it had as recently as March

2006 to take that step, see Illinois Tool Works Inc. v.

Independent Ink, Inc., 126 S.Ct. 1281 (2006), the Court has

refused to do so. Illinois Tool Works held only that the fact

that a tying product is patented does not support a presumption that the seller has market power over that

product. See 126 S.Ct. at 1291. It concluded that “tying

arrangements involving patented products should be

evaluated under the standards applied in cases like Fortner

II and Jefferson Parish rather than under the per se rule

applied in Morton Salt and Loew’s,” both cases involving

intellectual property (patents in Morton Salt, copyrights in

Loew’s). In my view, Illinois Tool Works thus stands only for

the proposition that a plaintiff must prove that a holder of

intellectual property has “either the degree or the kind of

market power that enables him to force customers” to

purchase the tied product. If a plaintiff can do so, then the

framework established by Jefferson Parish continues to

apply.

In the case before us, we must decide whether Reifert has

produced enough evidence to survive summary judgment

with respect to the allegation that the defendant Realtors

Associations have tied the multi-listing service (MLS, the

tying product) to membership in the Realtors Association of

South Central Wisconsin, Inc. (RASCW, the tied product).

The district court concluded that Reifert had not come

forward with the requisite evidence. I agree. The D.C.

Circuit offered a useful summary of the elements of a tying

case in United States v. Microsoft Corp., 253 F.3d 34 (D.C.

Cir. 2001):
18 No. 05-3601

There are four elements to a per se tying violation: (1)

the tying and tied goods are two separate products; (2)

the defendant has market power in the tying product

market; (3) the defendant affords consumers no choice

but to purchase the tied product from it; and (4) the

tying arrangement forecloses a substantial volume of

commerce.

Id. at 85. Here, I am willing to say that Reifert has brought

forth enough evidence to permit a trier of fact to rule in his

favor on the first three of those elements. His proof fails,

however, on the fourth.

The key point is not the measurement of how much

commerce in the tied product market was affected. It is the

fact that Reifert offered no evidence to show that there was

any foreclosure in the tied product market. As far as we can

tell from this record, no one refrained from joining any

other organization because of the cost of membership in the

Realtor Associations (RASCW and the others) before us.

This is what distinguishes our case from the Eleventh

Circuit’s opinion in Thompson v. Metro. Multi-List, Inc., 934

F.2d 1566 (11th Cir. 1991). In that case, the court explicitly

rested its decision on foreclosure, to which it referred as the

“coercion element,” explaining that “plaintiffs need to show

that [defendant] Metro not only has [ ] market power but

also has wielded this market power to force brokers to alter

their choice of professional associations.” Id. at 1577. It

then reported that the evidence in the record showed “that

400 of Empire’s prospective and current members did not

join Empire or quit Empire because of the prohibitive cost.”

Id. at 1578. This is precisely the type of showing that

Reifert failed to make.

Analytically, the majority may well be right that the rule

of reason approach it sees in Carl Sandburg Vill. Condo.

Ass’n No. 1 v. First Condo. Dev. Co., 758 F.2d 203 (7th Cir.

1985), would be a more sensible way to approach all tying
No. 05-3601 19

cases. But it is not for this court to anticipate the Supreme

Court’s overruling of its earlier decisions, even if the

passage of time and the impact of later cases that create

doctrinal tensions are evident to all. Just as we did in Khan

v. State Oil Co., 93 F.3d 1358 (7th Cir. 1996), overruled by

State Oil Co. v. Khan, 522 U.S. 3 (1997), we should limit

ourselves to pointing out the problems we see and then

attempting to apply the law as it stands as best we can. In

the present case, unlike State Oil, faithful application of the

existing law leads to the same outcome as the more ambitious approach the majority has chosen. For that reason, I

am happy to concur in the outcome that the majority

reaches, but I must respectfully decline to join its opinion.

A true Copy:

Teste: 

 ________________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit 

USCA-02-C-0072—6-12-06