* The Honorabl e David M. Lawson, Unit ed Sta tes Dist ric t Ju dge f

or the E astern D istrict of M ichigan , sitting by de signatio n.

1 RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Six

th Circuit Rul e 206

ELECTRO NIC CIT

ATION: 2003 FED App . 0417P (6th C ir.) File Name: 03a04 17p.06



### UNITED STATES COURT OF APPEALS

FOR THE SIXT H CIR CUIT

_________________

H IGHL AND C APITAL , I NC ., Plaintiff- Appellant

,

v.

F RANKL IN N ATION AL B ANK , Defendant-Appellee. X

- - - -

> , - - N No. 02-5505

Appeal from the United States District Court for the Middle District of Tennessee at Nashville. No. 00-00832—William J. Haynes, Jr., District Judge.

Argued: September 9, 2003

Decided and Filed: November 25, 2003

Befor e: GUY a

nd DAUGH TREY, Circ

uit Judges ; LAWSON, District Judge. *

_________________ COUNSEL

ARGUED: Jeffrey Alan G reene, Nashville, Te nnessee, for Appellan t. Jo sep h A. Wo odr uff

, W ALLE R , LANSDEN, 2 Highland Capital v. Franklin Nat’l Bank No. 02-5505

DORTCH

& DAVIS, Nashville, Te n nessee, for Appellee. ON BRIE F: Jeffrey Alan G reene, Nashville, Tennessee, for Appellan t. Jos eph A. Woodruf f, W. Trav

is Parham

, WA LL ER, LANSDEN, DORTCH & DAVI S, Nashville, Tennessee, for Appellee.

_________________ OPINION

_________________ DAV ID M. LAWSON, District Jud ge . The plaintiff, Highland Capital, I

nc. (Hig hland), a ppeals f rom a summa

r y judgment dismissing its complaint agains t Frankl inNational Bank (the Bank) t

hat was brought under the anti-ty ing provisions o f t he Bank Holding Company Act (BCHA), 12 U.S.C. § 1972. Hig

hland ass erted th at the Ba nk requir e d Highland to purchase stock in the Bank’s holding company as

a prerequisite for obtaining a loan. The lower co u rt found that there wa s insuffic ient evid ence of th e connect ion required by Section1972 between the loan and the stock purchase. We find that a claim under Section 1972 requires proof that the extension o f credi

twas actually c onditioned on the bank’s customer obtaining some ot

her pro duct or service from the bank or one of its subsidiaries, and that Highland did not offer evidence on this element sufficient to avoi d sum mary judgmen t. We there fore af

firm t he jud gm ent of the district court.

I.

At the time of the loan and the stoc k purc hase, Highland

was controlled by

it s pr in cip al s har eho ld er, St eve Mor ris s. In

anongoing

dis pu te with his

erstwhil e busines s partne rs, Morrisslos t control o f Highla nd. None o f the indiv

iduals

w ho succeeded to control of the company were inv olved i n the loan transactions at issue here, and all of t he p ersonnel who were involved, including bank repres entat ives and Morriss, aver that no tying condition was imposed a s aNo. 02-5505 Highland Capital v. Franklin Nat’l Bank 3

requirement

for ob taini ng the l oan. H igh land, under new ownership, believe s tha t it offered circumstantial evidence sufficient to contradict the direct denials of the defe ndan t’s witnesses and to cr

eatea material fact question that precludes
summary judgmen t.

Morrisscontro ll ed Highland in 1998. In the late r part of that year, Highland obtained a substantialsum of money from

a commercial transaction. I t subs eque ntly deposited $1 million of those f

unds into its

accoun t a t the B ank. Morr

iss thenapproached Charles Lanier, theBank’s Executive VicePreside nt, a nd told him that High land was interest ed in purchasingthe stock of th e B an k’ s h ol di ng co mp an y, Frankli nFinancial Corporation (FFC). Lani er sent M orriss to

see James Rinker, abroker with Fra nklin Fina ncial Sec urities, Inc. (FFS), who helped

the plaintiff

open a se curities

accoun t.

S h ortly thereafter, Highland soug ht a loan from the Bank for $610,000 to refinance an

existing loan on a 42-acre parcel of real estate located in Williamson County, Tenne ssee, referred to as the Hollis Tract. Morriss averred that he alone made the decision to seek this loan on behalf of Highland.
Highland received loan approval from the Ba nk on November

10, 1998. In making its decision, the Ba nk waived its otherwis e applic able poli cy of requi ring a w ritt e n loan applicationand submission of t he b orrower’s financial statemen t. The Bank

also did no t require

Morriss to
persona lly guaran tee t he loan. T

he Bank ’s decis ion is reflected on a pre-printed form entitled “L ending Officer’s Report” dated November 10, 1 998. T his repor t states: “Customer

has wired $1,000,000 i nto cash management

accoun t. Customer has also put in a b uy order f or 70,000 shares of Franklin Financial Stock.” Joint Appendix (J.A.) at 667. The loan collateral is described as 46 acres of real estate containing a 2,500-square-foot home valued at $800 ,000, appare ntly referring to the Hollis Tract, and a $90,000 escrow assignment. The form also notes that the financial statement requirement

was waived, and contained the explanation that 4 Highland Capital v. Franklin Nat’l Bank No. 02-5505

the Bank had “dealt with customer on several deal [sic] over the pa st yea rs . S at is fa ct or y. Will update appraisal.” Ibid. The Report, however, was later amended to correct errors and to remove the reference to the stock pur chase.

Onthe same day tha

t t he loan was approved, Highland deposited $499,777 into asecuriti es fund a ccount with FFS. Thesewere the funds used to purchase 69,400 shares of stock inth e B an k’ s h ol di ng co mp an y, FFC. Mor riss claims that he bought the stock “because [he] believed it was a good investment.” Aff. of S teve Mor riss at ¶ 2, J.A. at 79 . Prior to this time, neither

Highla nd nor Mor

riss owned any F FC stock, nor did Morriss or Highland ever purchase additional stock.

The loanclosed on December 7, 1998, and was secur ed by the Hollis Tract and a portion of the plaintiff’s FFC stock.

Inthe months that followed, the Bank made several additional loans to Highland at Morriss’ request. There is no contentionby the

plaintiff that

these loans were conditioned
uponHighland’s purchase of FF C stock. Rather, the plaintiff claims that these

other loans provide circumstantial evidence that the original loan was the produc t of a n illegal tying arrangement

between the plaintiff and the Bank. The B ank lent the plaintiff

$157,000 in February

1999 to fund litigation inwhich Mor

riss was e mbroiled w

ith his ex-pa

rtners. Then in Apr il 1999, the Bank lent the plaintiff an additiona l $85,000, which was also secure d by the Hollis Tract. The Bank additionally approved a rene w al of the original $610 ,000 note for $607,000 in January 2000, and a renewal of the $157,000 note on May 31, 2000.

Morrisslost

contro l of High

land in July

2000. A cl osely held com pan y called Ta

reco Properties, Inc . (Tareco) purchased

a Texas co

urt judg ment that was enter

ed sometime prior to 2000, for which Morris was some how li abl e. In partial satisfaction

of that judgment, Mr. Morriss gave Tareco his Highland stock. However, Tare co is owned and controlled

by K evin McShane , who is affiliated with two ofNo. 02-5505 Highland Capital v. Franklin Nat’l Bank 5

Morriss ’ former business partners, Jerrold Pressman and Robert Gering er. Pres sman is the plaintiff in a lawsu

it pending in the federal district c ourt in Tennessee that alleges that Mor riss, wit h the aid of the Bank and its Chairman, conspired to defraud Pres sman and Morr iss’ other business partners in a limited

partnership known

as In glehame Farm, LP. The purpose of this limited partnership was to d evelo p 400 acres o f Tenne ss e e property . The property , however, lacked access to major streets. The suit a lleges that Morr

iss, who was suppo sed to inve stigate acquir ing th e Hollis Tract for that purpose for the partnership, told his partners that the propert y could not b e purcha sed and, unbeknow nst to them, proceeded to purchase it for himself.
High land, under its

new owne

rship, fil ed suit ag ainst t

h e Bank asserting that the $610,000 loan was conditioned on the purchas e of stock in the Bank ’s ho lding company , and thus the Bank vi o lated the

anti-ty ing prov isions of 1 2 U.S.C. § 1972. The Bank moved for summary judgment. In support of the motion, the Bank filed affidavits from the seven members of its loan committee, who each averred that the loanwas not conditioned on the purchase of the holding
company stock ; the affidavits of Morriss and Bank officer Charles Lanier, who attested that Morriss initiated the inquiry regarding the purchase of the stock and that L anier did not solicit the transac t ion; and th e deposit ion of McShane, in whichhe acknowledged that he was a ware of no docume

nt, statement or conve rsation that estab lis hed t he tying of the loanto the stock purchase. In r esponse, Highland offered deposition evidence that tended to pro ve that most of the Bank’s stock

that Highland purchased

came fr om the private hold ings of

Gordon Inman, the Ba

nk’s Chairman, who stood to profit personally fr

om the transaction. The p laintiff points outthat James Ri

nker of F FS was I

nma n’s son-in-law and that he facilitated the stock transaction

. Highland also filed

anaffidavit from an individual who c o ntended that Inman engaged in private loan tra nsaction s with

him when the Bank could not do so, and

that one of those loans was conditioned

ont he p urchase of Bank holding company stock. A former 6 Highland Capital v. Franklin Nat’l Bank No. 02-5505

Bank employee a

verred that I nman cau sed the B ank to renege

ona lo an commitment, thereby depr iving the Bank of a profitab le business op po rtunity available at a very low risk, and then offer ed to ma ke th e l oa n p ri va te ly. Fi na ll y, Hi ghland submitted the opinion of Frank De Lisi, who wa s offered as a ba nking expert, tha

t the $610, 000 loan “ should nothave been made.” Dep. of Fr ank DeLisi at 152, 170-71, J.A. a t 846-850. Highla

nd arg ued that t he irre gulari

ties in processingthe loan, the lack of solid inform ati on about the creditworthines s of the borrower, and other evidence that the loanotherwise would not have been made in the normal

course of banki ng practice, coupled with the nefa rious condu ct o f Gordon

Inma n who cons

pired wit h Morriss t

o cheat Morriss’ business partners, proved that another, illega l motivation must have

prompted

the Ban k to lend $610 ,000 to Highland; and that

the “other motivation” must have been the prior purchase of the holding company stock.

The motion was

refer red to the magistr ate judge, who filed

a re port recommending that the motion be granted. The

ma gistra te judge f irst reje cted the

plaintiff ’s premis e that i t s statutory claim under the BHCA wa s analog ous to an a ntitrust

cause of action. He then found nothingillogical about a bank making a loan to an established customer with $1 million in the bank and securing

the loan with property va lued at more thanthe loan value. The ma gistrate judge noted that the plaintiff was req uired to show that it

was coe rced to p urchase ba nk stock as a

condition

of the loa

n to avoid s

umm ary judgmen t. After re viewi ng the circumstantial evidence, including evidenc e that t he loan was not ma

de pursua nt to normal banking procedures, that the loan a

nd stock pu

rchase occurred at relatively the

sa me time, and that the loan was part of a larger scheme be

tween Morriss and

t he Bank, the magistr ate concluded that the evi dence did not create a genuine issue of material fact.

Following an order requ esti ng further findings, the magis trate judge supplemented his report an d recommendation. The plaintiff filed timely objectionsto theNo. 02-5505 Highland Capital v. Franklin Nat’l Bank 7

recommendation. The distr ict cour t subseque

ntly granted the defendant’s motion for

summary judgme

nt and dismissed the complaint on March 22, 2002. The court ad opted the magistr ate judge’s description of the factual rec ord, and then concl uded

that there was no evidence that the Bank c oer ce d the plaintiff

to purchas e stock a s a

condition of obtaining the loan, and no proof

that the B ank “pos sessed th e ‘appr eciable economic’ power in the loan market to impose [the] tying arrangement.”

Dist. Ct. Judgment at 2, J.A. at 13. Judgment

was entere d for the

defenda nt, and the plaintiff

then file d its notice of appeal.

II.

We review an orde r gran ting summa

ry judgmen t de novo and use the same

standar d employ ed by the distri ct court

. See Moore v. Philip Morris Cos., Inc. , 8 F.3d 335, 339 ( 6th Cir. 1993). That test, of course, is set forth in Federal Rul e of Civil Pr oc ed ur e 5 6( c) , w hi ch st at es th at su mm ar y j ud gment is allowed w

here the moving pa

rty establi she s thro ugh ple adings, depositio

ns, answers to interrogat ories, a dmissions, and affida vit s that “there is no genuine issue as to any

ma te rial fact and that the moving party is entitled to a judg ment as a matter of law.” Fed. R. Civ. P. 56(c). A moving party ca

n meet its burden

under Rule 56(c) by “‘sh owing’ –that is, pointing out to the district court – that there is an absence of evidence to support the nonmoving party’s case.” Celotex C

orp. v. Cat

re tt , 477 U.S. 317, 325 (1986). See Estate of Mauro By and Through Mauro v. Borgess Med. Ctr. , 137 F.3d 398, 401 (6th Cir. 1998). Once the movi ng part y has made t hat sh owing, the nonmoving party cannot rest on its pleadings, but must identi fy specific facts that can

be estab lished by

admiss ible evidence that demonstr ate a genuine issue for trial. Ander son v. Liberty Lobby, Inc.

, 477 U.S. 242, 247-48 (1986); Celotex , 477 U.S. at 324; Hall v. Toll

ett , 128 F.3d

418, 421- 22 (6th

Cir. 1997).

We review the evidence in the light most favorable to the nonmoving party. Howe

ver, the party opposing

the summary 8 Highland Capital v. Franklin Nat’l Bank No. 02-5505

judgment motion must “do more than simply show that there is some ‘metaphysica

l doubt as to the material facts.’” Pierce

v. Commonwealth Life Ins. Co. , 40 F.3d 796, 8 00 ( 6th Cir. 1994 ) (quo ting Matsushita Elec. In d. Co. v. Ze

nith Radio Corp.

, 475 U.S. 574, 586 (1986)). Thu s, “[t]he mere existence of a

scintilla of evide nce in suppo rt of t he pla inti ff's position will be insufficient; there must be evidence on which the jury co uld reasonably f ind for the plaintiff.” Anderson

, 477 U.S. at 251-52.

As noted above, the statute upon which the plaintiff’s claim is based c omes fro m the BHCA , and stat es in rele vant par t:
(1) A bank sha

ll not in any

manner e xtend cre dit, lease

or sell property of a

ny kind, or furnish any se

rvice, or fix

or vary the consideration

for any of

the foregoing, on the condition or requirement--

. . . (B) that the c

ustomer shall obtain some additional credit,
pr op er ty, or service from a bank holding company of suchbank, or from any

othe r s ubsidiary of such ba nk holding company ; [or]

. . . (D) tha t the customer shall provide some additional credit, pr op er ty, or service to a bank holding company

of suchbank, or to any ot he r subsidiary of such ba nk ho ld in g c om pa ny.

12 U.S.C. § 1972 (emphasis added). C ongre ss enacte d this provision “to apply the g eneral principles of the Sherman Antitrust Act prohibiting anticomp etitive ty ing arr angeme nts specific ally to the f

ield of commercial banking.” Kenty v. Bank One, N.A. , 92 F.3d 384, 394 (6th Cir. 1996) (quoting Pars on s Steel, Inc. v. First Alabama Bank of Montgomery,No. 02-5505 Highland Capital v. Franklin Nat’l Bank 9

N.A.

, 6 79 F.2d 242, 245 (11th Cir.1982), rev’d on other grounds , 474 U.S. 518 (1986)).

The Sherm an Act does not explicitly prohibit ty ing
arrang ements. However, such arrang ements can violate b oth Section1 of the She

rman Act (15 U.S.C. § 1) and Section 3 of the Clayton Act (15 U.S.C. § 4) when the y produce

a n anticompetitive effec t. A tying ar rangement may

also support

a claim for monopolization under Section 2 ( 15 U.S.C. § 45) of the Sherman Act. See D avis v. Marathon Oil Co. , 528 F. 2d 39 5, 398 (6th

Cir. 1975) . A ty

ing arr angeme nt is defined “as an a greem ent b y a party to sell one product but only on the condition that the buyer a lso purchases a different (or tied) product, or at least agrees tha t he will not purchas e that product from any

other supplier.” Northern Pac. Ry. Co.

v. Unit ed States , 356 U.S. 1, 5-6 (1958). Most tying c ases involve a seller’ s attempt t

o exploit its economic power over

one product or in one market to force a les s desi rable, tied
pr oduct on a buyer. T

hus, tying ar

rangements have bee

n found to be “unr

easonab le in and o f themsel ves wh enever a party has sufficient economic power with respect to the ty ing product to appreciably

restrain free competition in the market for the tied pro duct and a ‘not insubstantial’ amount of interstate commerce is affected.” Id. at 6.

A tyin g claim u nder the Sherman Act requires that the plaintiff prove that a seller had

substantial economic

power in the tying product’s mar

k et, see Jef

ferson Par

ish Hosp. D ist. No. 2 v. Hyd

e , 466 U. S. 2, 12-13, 26-31 (1984) (noting that “the essentia

l chara cteristi c of an in

va lid tying arr

angement lies in the seller’s exploitation of its control over the tying product to force the buy

er into the purchase of a tied product that th e b uye r either did not want at all, or might have prefer red to purchas e elsewhere on different terms”), a nd an anticompetitive effect in the tied-product market. See PSI Repair Servs. V. Honeywell, Inc. , 104 F.3d 811, 821-22 (6th Cir. 1997). 10 Highland Capital v. Franklin Nat’l Bank No. 02-5505

However, a plaintif

f need not establish a bank’s economic
power or an ant i-competitive ef

fect to ma ke out a claim under 12 U.S.C. § 197 2. “The l angua ge of the [Act] ma kes clear that the avai labilit

y to a potentia

l customer

of any credit,
pr op er ty, or servi ce of a b ank may not be con

diti o ned upon that customer’s use of any other c redit, property, or

service offered by

the bank . . . . The purpose of this provis ion is to prohibit anti-competitive practices [that] require bank customers to accept or provide some other service or pr oduct

or refra in from de aling with other p arties in order to obtain the bank pro duct or servi ce they de sire.” S. Rep. 91-1084 (1970), reprinte

d in 1970 U. S.C .C.A.N. 5519, 5535. Nonethe less, Section1972 “wa s not intended to interfe re with the conduct of appropriate traditional banking pra ctices,” McCoy v. Franklin Sav. Ass’n 636 F.2d 1 72, 175 (7 thCi r. 1980) (quot ing Clark

v. United Bank

of Denver Nat’l Assoc.

, 480 F.2d 235, 238 (10th Cir.), cert. denied, 41 4 U.S. 1004 (1973)), or to prohibit b anks from protec ting the ir investments. Parsons Steel, Inc. , 679 F.2d at 245.

To make out a claim under Section 1972, theref ore, th e plaintiff must prove

that ( 1) the b ank impose d an anticomp etitive tying ar

rangement, that is, it conditioned the extension of credit upon the borrower’s obtaining or offering additional credit, propert

y or service s to or from the bank or its holding company ; (2) the arrangement was not usual or traditi on al in the banking industry; a nd (3) the practice conferred a benefit on the bank. S ee Kenty , 9 2 F.3d at 394 (quoting Sanders v

. First Na t’l Bank &Trust Co. , 936 F.2d 273, 278 (6th Cir. 1991)).

Th e district court based its summary judg ment fo r th e defendant in part on

the gro und that th e plainti f

f failed to offer evidence of the Bank’s “‘appreciable economic’ powe r inthe loan market to

impose [the ] tyin

g arra ngemen t.” Dist. Ct. Judgment at 2, J.A. at 13. T his wa s error. The plaintiff

was not required to prove that the Bank had sufficient streng thin the cr

edit mark et to ena ble it to imp ose the tying
arrang ement. See Co stner v. Blount Nat’l. Bank , 578 F.2dNo. 02-5505 Highland Capital v. Franklin Nat’l Bank 11

1192, 1 196 (6th Cir. 1978) (observing that “[t]he bank wa s also sued under the Bank Holding Company Ac t, which establishes a Per se [sic] rule and provides the same penalties for tying ar rangements as the Sherman Act, but without the necessi ty of pr ov in g a ny eco nomic power in the market for the tying p roduct ”). The plaintiff could sat

isfy the first element required of a claim und er Secti on 1972 merely by showing that the Bank demanded that Highland obtain other propert y (the bank holding company stock) or furnish o ther propert y (the paymen

t fo r the stock) as a condition or requirement of obtaining the $610,000 loan.

We agree with the district court, however, that the plaintiff failedto establish

a factu al issue o n the existe

nce of a tyin g arrang ement. In its

mo t ion for summary judg ment, the defendant pointed out the abse

nce of e vidence on this element, and came forward with direct evidence to prove the contrary proposition, in the form of affidavits from everyone involved in seeking and

making the loan, who each said that the stock pur

chase w as not

a condition or requirement for the extension of credit. See Celotex , 477 U.S. at 325. Under our
summary judgment jurisprudence, the plaintiff was obligated
at that point t

o comeforwar

d with fac

ts that proved, or from whicha fact finder reasonably could infer, that the Bank

re quired Highla nd to buy

its holding

company

stock as a condition of r ecei ving the loan. See Anderson , 477 U.S. at 247-48. To meet that burde n, the plaintiff imported the alleg ations from the lawsuit by Pressman a gainst the Bank and o thers that Morriss and Inman were engaged in a conspiracy

to cheat

Morriss’ partners in a rea l estate development venture, testimony that the stock purchase was filled from Inman’s personal

hold ings through Inman’s sonin-law, proof that th e loan did not adhere to the Bank’s normal lending policies, and the opinion of a

banking expert that the loan should

not have been made in the normal c ourse of banking business. This offe

ring fa lls consider

ably short of the pr oof tha t this Circuit requires to establish a successful Section 19 72 claim. 12 Highland Capital v. Franklin Nat’l Bank No. 02-5505

The plaintiff argues that the circumstantial evidenc e points
t o the conclusion that Morriss caused Highland to buy the Bank’ s holding c ompany stock spe cifical ly in

order to influence the Bank’s decision on High land’s lo an reque st. That argume nt sugg ests that a

statutor y claim can be established

without actually proving

“coercion” on the part of the Bank. Indeed, in Dibidale of La., Inc., v. American Bank & Trust Co. , 916 F.2d

300 (5th Cir. 1990), the court held that the ant i- tyi ng provision of the BHCA “does not include a coercion element.” Id . at

302. In that case, the plaintiff sought a constr ucti o n loan from the defendant bank and
ag re ed to hire the bank’s preferred choice as construction manager. The loan was made, butthe construction manager turned out to be incompete

nt and ca used con siderab le loss to the plaintiff

. The pla

intiff ad mitted tha

t h ir ing the constructionmana

ger was n ever

an exp lic it condition of receiving the loan, althoug

h the bank

had made

it clear that it would feel “comfortable” with that choi ce , and that he went along with it out of deference to the bank. I n reve rsing th e lower court’s di smi ssal of the

Section 19 72 claim, the Fift h Circuit construed the “condition or requirement” lang uage of the st at ut e q ui te br oa dl y, reasoning that “[t]o restrict the scope of those word s to tying arr angeme nts in which a selle

r is lite rally forced to purchase or provide a tied produc t or service in order to obtain credit would vitiate that section’s intended role, for as Congress recog nized, a tying arrangement

may squelch compe

tition whether coercive or not.” Id. at 306.

Likewise, in S & N Equip. Co. v. Casa Grande Cotton Fin. Co.

, 97 F.3d 33 7 (9th Cir. 1996), th e Ninth Circuit rejected the argument that Section 1972 requires a claimant to show “somemodicum of coercion” and, instea d , held that “[a] ltho ugh some showing of coercion may be required

under th e Clayton Act and the Sherma n Act, . . . it is not a requirement

under the

Bank Ho ldin g Company Act.” Id. at 346 n.18. A contrary

view, how ever, w as expres s ed b y the Eleventh Circuit in Integon Li

fe Ins. Corp. v. Browning

, 989 F.2d 1143, 1150-51 (11th Cir. 1993), construing the identicalNo. 02-5505 Highland Capital v. Franklin Nat’l Bank 13

langua ge found in the Home Own ers’ L oan Act, 12 U.S.C. § 1464( q). Tha t court he ld that “to establish a ty ing in violation of HOLA, a plaintiff must prove that the thrif t forced o r coe rced the plaintiff into purchasing the tied product.” Id. at 1151.

Alth ough we do not s

ubscribe to the vie

w set forth by

the Fifth Circuit, because it disregards the plain lang ua ge o f the statute, we l ikewise believe that emphasizing the notion of “coercion” creates a requirement that is not contained in the statute. Se c tion 1972 does not require proof of “force or

coe rcion,” particularly a s those terms are used i n th e economic sense in a

ntitrust ju

ris prud ence. T

he terms employed in the statute are “condition or requirement.” A “condition” is “[s]omet hi ng dema nded or r

equired as a prereq uisite to the granting or p erfor mance of something else.” O XFORD E NGLI SH D ICTIONARY 309 (2d ed. 1989). A “requir ement” is “that which is c alled for or dema nded; a condition which must be complied with.” Id. at 1565. Giving those terms their ordinary meanings as used in Section 1972,

we conclude that a statutory violation is established by proof that a bank convey

ed an i ntention to

withhold c

redit unle ss the borrower fulfilled a “prerequisite” of purchasing or furnishing some other product or service. The borrowe r may readily agree with the tying condition demande d by the bank; that is, th e who le notion of force or involuntary submission
may be absent. Nonetheless, proof of a statutory violat i on will be made out

by evidence

that taking or furnishing

another service or produc

t is a condition that must be fulfilled before the bank w

ill agre e to extend

credit.

Inthis case , Morriss a

greed to purcha se the Bank’s holding
company stock on behalf of Highland, and the buy order was reported to the loan committee in the first version of the Loan Officer’s Report. This evidence may establish that the Ba nk looked more favorably

upon Hi ghland because of the stock purchase. It is not enough, however , merely to bring fort h evidence that

the borrower purchased another bank product or service to c urry

favor with the lender, or that the lender was 14 Highland Capital v. Franklin Nat’l Bank No. 02-5505

positively impressed by such c onduct, or even that the other transaction

was a factor in the bank’s decision to extend credit. Accord

ing to the plain language of the statute, a claimant must prove that the purchase of the tied product or service was a mandatory condition or requirement of obtaining a loan from the lender. The borrower must be prevail ed upon to agree to the additional product or service

, lest credit be denied.

This element of

a Section 1972 claim may be e stablished by circumstantial evidence. How ever, the plaintif f in this ca se failed to of fe r admissible evidence from which an inferenc e of a tying a rrangement could be dr

a wn. The procedure that led to the loan’s approval, although perhaps out of the

or di na ry, di d n ot de mo ns tr at e t ha t a tyi ng cond ition was imposed. A reasonable per son wou ld not conc lude that a bank’s decision t o lend $610,000 to an established bank customer, without a loan app l ication or personal guarantee, when the loan was secur

ed by propert y appraised at $800,000 plus additional property va lued at $90,000, w as un usual or prompted by an ulterior

motive. The evidence of the shadowy deali ngs betwee

n Morriss and Bank Chairman Inman ma y be relevant to the other litigation involving Morriss’ former business partner s, but it has little to do with any connection between the loan and the stock purchase. To the contrary , the inference that emerges from this evidence is that the original and subsequent loans were m ade t o further another conspiratorial objective allowingMorriss to usurp a business opportuni ty from his real estate venture, not as consideration for the purc hase of F FC stock. Inma

n’s priva te dealin gs with other Bank customers does nothing to further the inference of

a tyin g arra ngemen t i nvo lving the Bank, Morriss, and the plaintiff. Fi na ll y, the plaintiff’s banking expert, who testified that “[t]here is no direct evidence, whatsoever, that there is – there was a requirem ent , as a condition of the loan, that he buy the stock,” Dep. of Frank DeLisi at 152, J.A. at 847, does not furnish the necessary

link thatsupports an inference of a tyin g arra ngemen t.No. 02-5505 Highland Capital v. Franklin Nat’l Bank 15

III.

The plaintiff’s argument that the Bank’s $610,000 loan was illega lly tied to Highland’s purch ase of F FC stock does not rise above the level of speculation or conjecture. C onstructing a circumstantial case in the fac e o f overwh elmi ng, contrary , direct evi dence was a daunting burden that, we believ e, ul timately proved insurmountable for the plaintiff. The plaintiff failed to establish a genuine issue for trial on a n essenti al eleme

nt of its claim . We therefore affirm the district

court’s summary judgmen t in favor of the defenda nt.