2008 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit 1-28-2008 

# Atl Ex p o sit ion S e r v

. S M G P r e c e de nt i al or N on-P r e c e de nt i al : N on-P r e c e de nt i al D ocke t N o . 06-4848

F o llow thi s and a dd it ion al work s at : http://d i git alc ommon s .l a w . vi ll anova . e du/thir dc ir c uit_2008

Thi s de c i sion i s br ou ght t o you for f r e e and ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

. It h as be e n a c c ept e d for inclusion in 2008 D e c i sion s b y an author i z e d a dmini s tr at or of V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

. F or mor e inform at ion, p le as e c ont a ct Be n j amin . C arl s on@l a

w . vi ll anova . e du . Re c omme nde d C it at ion " Atl Exposit ion S e r v

. S MG " (2008). 2008 D e cisio n s . P ape r 1699. http://d i git alc ommon s .l a

w . vi ll anova . e du/thir dc ir c uit_2008/1699H onor abl e Paul S D i amond, D i s t r i ctJ udge forthe U ni t ed St at es D i s t r i ctC our tof the * E a s te rn D is tr ic t o f

P e n n s y lv a n ia , s ittin g b yd e s ig n a tio n . NOT P RE CE DE NT I AL UN I TED STATES CO UR T OF A PP EALS F O R T H E T H IR D C IR C U IT

___________ N o. 06- 4848

___________ A T L A N T IC E X P O S IT IO N S E R V IC E S IN C .;

HO W AR D C ASPER

v. SM G , fo r mer l ykn own as SPEC TA CO R M A N A G EM EN T G RO U P; R O B E R T M C C L IN T O C K ; SO U T H JE R S E Y R E G IO N A L C O U N C IL

O F C A R PE N T E R S, L O C A L 623 H o w ard C asp er, A ppel l ant

________________________ O n A p p ea l from the U n it ed S tat es D istri ct C o u rt

fort he D i s t r i ctof N ew J er s ey ( D i s t r i ctC our tN o: 00- cv- 3465) D i s t r i ctJ udge: J os eph E. I r enas

________________________ Subm i t t ed U nderT hi r d C i r cui tL . A . R . 34. 1( a)

N ovember29, 2007 B efor e: B A R R Y , FU E N T E S, C i r cui tJ udges , and D I A M O N D , D i s t r i ctJ udge. * ( O pi ni on Fi l ed: J anuary28, 2008)O n A pr i l 20, 2004, A t l ant i c Exposi t i on w i t hdr ew i t s cl ai m fori nj unct i ve r el i ef a nd 1 a s s ig n e d its d a m a g e c la im to its f o rm e r p ri n c ip a l, H o w a rd C a s p e r.

2 ___________ OPI NI ON O F THE COURT

____________ FU E N T E S, C i r cui tJ udge. I . F ACT UAL AND P ROCE DURAL BA CKGROUND A ppel l ant , A t l ant i c Exposi t i on Ser vi ces , I nc. ( “A t l ant i c Exposi t i on”) , i s a tr ade 1 s how contr act orl ocat ed i n A t l ant i c C i t y , N ew J er s ey , w hi ch s et s up and t akes dow n t r ade s how s m ai nl yatt he A t l ant i c C i t yC onvent i on C ent er( t he “Convent i on C ent er ”) and A tla n tic C ity c a s in o h o te ls . T h e C o n v en ti o n C en ter i s am o n g the th irtylarge st i n the c o u n try . S h o w p rod u ce rs choos e among t he conve nt i on cent er s and othervenues t o hous e thei rtr ade s how s . O nce a s how pr oducerchoos es a l ocat i on, s uch as the C onvent i on C ent er , i ts i gns an agr eement governi ng i t s us e of the s pace . T he s how pr oducerm us tobt ai n w or ker s t o cons t ructand di s m ant l e the exhi bi tboot hs . A t l ant i c Exposi t i on i s one of manys how contr act or s that p e rf o rm th a t s e rv ic e f

o r s h o w p ro d u c e rs a t th e C o n v e n tio n C e n te r. B etw een 1983 a nd 1995, t he A t l ant i c C i t yC onvent i on C ent erA uthor i t y( t he “A ut hor i t y ”) oper at ed and managed the C onvent i on C ent er . I n 1983, the A uthor i t yand a uni on, Sout h J er s eyR egi onal C ounci l of C arpent er s , L ocal 623 ( “C arpent er s ”) , s i gned a3

col l ect i ve bar gai ni ng agr eementforl aborr at es and t erm s atthe C onvent i on C ent er ( “1983 A gr eement ”) . D ur i ng t he per i od w hen the 1983 A gr eementw as i n eff ect , the A u th o rity , an d th e n S M G , w h ich w a s h ire d to m a n a g e th e C o n v e n tio n C e n ter sta rtin g in 1995, di r ect l yempl oy ed C arpent er s excl us i vel yt o do the tr ade s how w or k i n t he C o n v e n tio n C e n te r, a n d n o w o rk w a s s u b c o n tr a c te d to o th e r s h o w c o n tr a c to rs . C o n c lu d in g th a t th e 1 9 8 3 A g re e m e n t ex c lu d e d so m e sh o w s d u e to th e h ig h lab o r c o sts w h ich w e re p a ss e d o n to sh o w p ro d u c e rs, S M G e n ter e d in to a n a g re e m e n t w ith C arpent er s i n A pr i l 1996 ( “1996 A gr eement ”) t o obt ai n m or e fa vor abl e r at es . I n t he 1996 A gr eement , C arpent er s and SM G agr eed thati f SM G chos e t o s ubcontr actthe c o n stru c tio n o f

e x h ib it b o o th s, it co u ld o n lysu b c o n tra c t to c o m p a n ies th a t sig n a se p a ra te col l ect i ve bar gai ni ng agr eementw i t h C arpent er s . T hats epar at e col l ect i ve bar gai ni ng agr eementr equi r ed s how contr act or s t o us e C arpent er s foral l thei rtr ade s how c o n s tru c tio n n e e d s in s e v e n S o u th e rn N e w J e rs e yc o u n tie s (“ S e v e n C o u n ty A g re e m e n t” ). A tla n tic E x p o s itio n re f

u s e d to s ig n th e S e v e n C o u n ty A g re e m e n t w ith C a rp e n te rs . T hough A t l ant i c Exposi t i on w as abl e t o w or k i n t he C onvent i on C ent er , i thad t o contr act forC arpent er s ’ l abort hr ough SM G , and abi de bythe unfa vor abl e t erm s of the 1983 A g re e m e n t. A ti s s ue i n t he i ns t antappea l i s A t l ant i c Exposi t i on’ s cl ai m thatthe 1996 A g re e m e n t v io late s S e c tio n 1 o f th e S h e rm a n A c t, 15 U .S .C . § 1 . T h e D istric t C o u rt h e ld t hatA t l ant i c Exposi t i on coul d nots how thatthe C onvent i on C ent erw i el ded s uffi ci ent m arketpow ert o caus e an a nt i t rus ti nj ury , beca us e i tcoul d nots how thatthe C onvent i onTh e Di s t r i c tCo u r th a d f e d e r a l s u b

j e c tma t t e rj u r i s d i c t i o n o v e rth i s c a s e u n d e r2 8 U. S . C. 2 § 1 3 3 7 (a) an d 1 5 U . S . C . § 4 . T h e D istri ct C o u rtg ran ted th e d ef en d an ts’ su m m ary ju d g m e n t m o tio n . T h e D is tr ic t C o u rt ’s d e c is io n w a s f in a l a s to a ll p a rt ie s a n d c la im s . T h e re f o re , w e h a v e ju ri s d ic tio n o v e r t h e a p p e a l p u rs u a n t to 2 8 U .S .C . § 1 2 9 1 . 4 C ent eral one w as t he r el evantgeogr aphi c mar ket . C oncl udi ng thatthe r el evantm arket w as l ar ge tr ade s how venues i n t he N or t heas torpos s i bl yacr os s the U ni t ed St at es , the D i s t r i ctC our tgr ant ed s um m aryj udgm entforthe def endant s . Forthe r eas ons di s cus s ed bel ow , t he dec i s i on of the D i s t r i ctC our tw i l l be af fi r m ed. 2 II. DI S CU S S I ON T he C l ayt on A ctperm i t s pr i vat e enf or cementof the ant i t rus tl aw s by“anyper s on w ho s hal l be i nj ur ed i n hi s bus i nes s orpr oper t ybyr eas on of anyt hi ng forbi dden i n t he ant i t rus tl aw s . ” 15 U . S. C . § 15( a) . D es pi t e thi s br oad l anguage , the Supr eme C our thas not ed that“the l ow erfede r al cour t s have be en vi r tual l yunani m ous i n concl udi ng that C ongr es s di d noti nt end the ant i t rus tl aw s t o pr ovi de a r emedyi n damages foral l i nj ur i es t hatm i ghtconce i vabl ybe tr ace d t o an ant i t rus tvi ol at i on. ” A s s oc. G en. C ontr act or s of C al i forni a, I nc. v. C al i forni a St at e C ounci l of C arpent er s , 459 U . S. 519, 534 ( 1983) ( i nt ernal quot at i ons and ci t at i on om i t t ed) ( “A G C ”) . A ccor di ngl y , the Supr eme C our thas re q u ire d c o u rts, in o rd e r to d e ter m in e if a p lain tiff

c a n b rin g a n a n titru st c laim , to “eva l uat e the pl ai nt i ff’ s harm , t he al l eged w r ongdoi ng bythe def endant s , and the re la tio n s h ip b e tw e e n th e m .” Id . a t 5 3 5 . A “show i ng of an t i t rusti njuryi s necessary , bu tno tal w ay s suffi ci ent, t o est abli sh s t andi ng . . . , beca us e a pa r t ym ayhave s uffe r ed ant i t rus ti nj urybutm aynotbe a pr oper5

pl ai nt i ff . . . forot herr eas ons . ” C ar gi l l , I nc. v. M onfor tof C ol or ado, I nc. , 479 U . S. 104, 1 1 0 , n .5 (1 9 8 6 ). In o rd e r to sh o w a n a n titru st in ju ryth e “ p lain tiff

m u st p ro v e th a t it s uffe r ed an i nj ur yt hat( 1) i s of the type the ant i t rus tl aw s w er e i nt ended t o pr eventand ( 2) fl ows f r om t ha tw hi c h mak e s de fe nd a nt s ’ a c t s un l a w fu l . ” A t l a nt i c Ri c hf i e l d Co. v. U SA P e tr o le u m C o ., 4 9 5 U .S . 3 2 8 , 3 4 9 (1 9 9 0 ) ( in te rn a l q u o ta tio n s a n d c ita tio n o m itte d ). C ons i der i ng t hi s i s s ue de novo , w e c o n sid e r w h e th e r th e in ju ryth a t A tlan tic E x p o sitio n a lleg e s is o f th e typ e th a t an titru st la w s w e re in ten d e d to p re v e n t. Id . A tlan tic E x p o sitio n c laim s th a t itsa tisf ies th is re q u ire m e n t b e c a u se A tlan tic E x p o sitio n lo st p ro f its “fr om havi ng t o payt he hi gherr at es of the C arpent er s compar ed t o t he l ow err at es of [A t l ant i c Exposi t i on’ s pr efe r r ed uni on] . ” ( A t l ant i c Exposi t i on R epl yB r . at8. ) T he purpos e of a nt i t rus tl aw s i s t o pr ot ectcompet i t i on, notcompet i t or s . L eegi n C r eat i ve L e a th e r P ro d s., In c . v . P S K S , In c ., 1 2 7 S .C t. 27 0 5 , 2 7 2 4 (2 0 0 7 ). T h u s, A tlan tic E xp osi t i on ’s refer ence to i t s l ostprofi t s al on e do es not s ho w anti t rusti njury . W e m ust con si der com peti t i on from “t he v i ew po i nt of the co nsum er, ” l oo king at“t he p ri ces, quant i t yorqual i t yof goods ors ervi ces ” i n t he r el evantgeogr aphi c mar ketfora pr oduct t o det erm i ne i f ther e has been a n i nj uryt o compet i t i on. M athew s v. L anca s t erG en. H o sp . , 8 7 F . 3 d 6 2 4 , 6 4 1 (3d C ir . 1 9 9 6 ) (i n terna l qu o tat ion s an d cit ati o n o m itted). If A tlan tic E x p o sitio n c o u ld sh o w th a t th e C o n v e n tio n C e n ter w a s in its o w n g e o g ra p h ic m arketand abl e t o r ai s e pr i ces ordecr eas e the qual i t yof the s ervi ces i tpr ovi ded af t er ent er i ng i nt o t he 1996 A gr eement , t hi s w oul d s how thatthe i nj uryw as “of the type the a n titr u s t la w s w e re in te n d e d to p re v e n t.” A tla n tic R ic h f ie ld C o ., 4 9 5 U .S . a t 3 4 9 .6

Ac c o r d i n g l y , we f

i r s tc o n s i d e rwh e t h e rth e Co n v e n t i o n Ce n t e rwa s i t s o wn geogr aphi c mar ket . “The r el evantgeogr aphi c mar keti s the ar ea i n w hi ch a pot ent i al buy erm ayr at i onal l yl ook fort he goods ors ervi ces he ors he s eeks ; boundar i es of a pr oductm arketar e det erm i ned byt he r eas onabl e i nt er change abi l i t yof us e orthe cr os s - el as t i ci t yof demand. ” Pa. D ent al A s s ' n v. M ed. Svc. A s s ' n of Pa. , 745 F. 2d 248, 260 ( 3d C i r . 1984) ( i nt ernal ci t at i ons om i t t ed) . “I nt er change abi l i t yi m pl i es thatone pr oducti s r oughl yequi val entt o anotherforthe us e t o w hi ch i ti s put . ” Q ueen Ci t yPi zza , I nc. v. D om i no' s Pi zza , I nc. , 124 F. 3d 430, 437 ( 3d C i r . 1997) ( i nt ernal quot at i ons and c ita tio n o m itte d ). T he D i s t r i ctC our tcons i der ed the geogr aphi c mar ketfr om the per s pect i ve of the sh o w p rod u ce rs. A tl an ti c E x p o sit ion arg u es th at th is w as e rror, that the D istri ct C o u rt s houl d have c ons i der ed the geogr aphi c mar ketfr om the per s pect i ve of l ocal s how contr act or s , once the s how pr oducer s had s el ect ed the C onvent i on C ent er . I f the D i s tr i ct C our tw as corr ectt o cons i dert he geogr aphi c mar ketfr om the per s pect i ve of the s how p ro d u c e rs, th e f

in d in g th a t th e C o n v e n tio n C e n ter c a n n o t b e its o w n m a rk e t is c e rta in ly c o rre c t. A tlan tic E x p o sitio n d o e s n o t d isp u te th a t sh o w p ro d u c e rs h a v e ro u g h ly equi val ental t ernat i ves t o t he C onvent i on C ent eri n Phi l adel phi a, A t l ant i c C i t yand e ls e w h e re o n th e E a s t C o a s t. T h e D e p a rtm e n t o f

Ju stic e ’s m e rg e r g u id e lin e s p ro v id e g u id a n c e o n w h e th e r it is appr opr i at e t o defi ne a mar ketfr om the per s pect i ve of the s how contr act or s . I n t he m er gergui del i nes , t he D epart m entof J us t i ce de fi nes a geogr aphi c mar ketas “a r egi on7

s uch thata hypot het i cal m onopol i s tthatw as the onl ypr es entorfutur e pr oducerof the r el evantpr oductatl ocat i ons i n t hatr egi on w oul d pr ofi t abl yi m pos e atl eas ta ‘ s m al l but sig n if ica n t an d n o n tra n sito ry ’ in c re a se in p ric e , h o ld in g c o n sta n t th e ter m s o f sa le f o r a ll pr oduct s pr oduced e l s ew her e. ” U . S. D epart m entof J us t i ce a nd the Feder al T r ade C om m i s s i on, H or i zont al M er gerG ui del i nes , § 1. 21 ( 1997) . A ppl y i ng thi s defi ni t i on, as l ong as t he s how pr oducer s have opt i ons ot herthan the C onvent i on C ent er , SM G w i l l be u n a b le to p ro f

itab lyim p o se a p ric e in c re a se a n d , the re f o re , ca n n o t b e its o w n g e o g ra p h ic m arket . I n addi t i on, t he Second Ci r cui thas hel d t hata “ge ogr aphi c mar ketencompas s es t he geogr aphi c ar ea . . . i n w hi ch the ant i t rus tdefe ndant s fac e compet i t i on. ” H eerw agen v. C l earC hannel C om m c’ ns , 435 F. 3d 219, 228 ( 2d C i r . 2006) ( i nt ernal quot at i ons and ci t at i on om i t t ed) . I ti s undi s put ed thatthe C onvent i on C ent ercompet es t o att r acttr ade sh o w s w ith o ther c o n v en ti o n ce n ters. T h is view also su p p o rt s the D istri ct C o u rt ’s d e te rm in a tio n th a t th e C o n v e n tio n C e n te r w a s n o t its o w n g e o g ra p h ic m a rk e t. A ccor di ngl y , w e af

fi r m t he D i s t r i ctC our t ’ s det erm i nat i on thatthe C onvent i on C e n ter is n o t it s o w n g e o g ra p h ic m a rk e t. T h e re f o re , A tlan tic E x p o sitio n w ill b e u n a b le to s h o w a n a n titr u s t in

ju ry a n d , a c c o rd in g ly, d o e s n o t h a v e s ta n d in g to p u rs u e th is c la im . III . C oncl usi on F o r th e re a so n s s tate d a b o v e a n d in th e D istric t C o u rt’s w ritten o p in io n , w e w ill a f f ir m th e d e c is io n o f

th e D is tr ic t C o u rt .