1996 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

7-24-1996

Ideal Dairy Farms v. John Labatt Ltd

Precedential or Non-Precedential:

Docket 95-5435

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Recommended Citation

"Ideal Dairy Farms v. John Labatt Ltd" (1996). 1996 Decisions. Paper 114.

http://digitalcommons.law.villanova.edu/thirdcircuit_1996/114
 UNITED STATES COURT OF APPEALS 

 FOR THE THIRD CIRCUIT 

 

 No. 95-5435 

 

 IDEAL DAIRY FARMS, INC., 

 Appellant 

 v. 

 JOHN LABATT, LTD.; JOHN LABATT, INC.; TUSCAN DAIRY FARMS, 

 INC.; JOHANNA DAIRIES INCORPORATED; ROBERT FACCHINA; 

 ABC COMPANIES, 1 THROUGH X (FICTITIOUS NAMES OF LABATT 

 AFFILIATES THAT ACTIVELY PARTICIPATED IN THE 

 MONOPOLISTIC PRACTICES DESCRIBED BELOW, BUT WHOSE 

 IDENTITIES ARE PRESENTLY UNKNOWN); JOHN DOES, 1 THROUGH X 

 (FICTITIOUS NAMES OF OFFICERS AND/OR DIRECTORS OF THE 

 CORPORATE DEFENDANTS WHO ACTIVELY PARTICIPATED IN THE 

 DECISION-MAKING REGARDING THE MONOPOLISTIC PRACTICES 

 DESCRIBED BELOW, BUT WHOSE IDENTITIES ARE PRESENTLY 

 UNKNOWN); ELMHURST MILK & CREAM COMPANY, INC.; 

 LOCAL 584, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, 

 CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, 

 AFL-CIO; HONEYWELL FARMS, INC., t/a ELMHURST DAIRY 

 

 TUSCAN DAIRY FARMS, INC., 

 Defendant/Third-Party Plaintiff 

 

 v. 

 IDEAL DAIRY FARMS, INC.; 

 GILBERT LEVINE; 

 MARK GREENBERG, 

 Third-Party Defendants 

 

 

 On Appeal from the United States District Court 

 for the District of New Jersey 

 (D.C. Civil Action No. 92-cv-02469) 

 
 

 Argued May 3, 1996 

 Before: SCIRICA and ROTH, Circuit Judges 

and GODBOLD, Circuit Judge 

 (Opinion Filed July 24, l996) 

 

Sheldon A. Weiss, Esq. (Argued) 

225 Millburn Avenue 

Suite 203 

Millburn, NJ 07041 

Steven Pasternak, Esq. 

Pasternak, Feldman & Plutnick 

70 South Orange Avenue 

Eisenhower Plaza South, Suite 245 

Livingston, NJ 07039 

 Attorneys for Appellant 

Thomas H. Moreland, Esq. (Argued) 

Lawrence E. Jacobs, Esq. 

Kramer, Levin, Naftalis, Nessen, Kamin & Frankel 

919 Third Avenue 

New York, NY 10022 

 

 Attorney for Appellee Tuscan Dairy Farms

Frederick L. Whitmer, Esq. 

Pitney, Hardin, Kipp & Szuch 

P.O. Box 1945 

Morristown, NJ 07962-1945 

 Attorney for Appellees John Labatt Ltd.;

 John Labatt, Inc.; Johanna Dairies, Incorporated and 

 Robert Facchina 

 

 OPINION OF THE COURT 
 

ROTH, Circuit Judge: 

 The litigation giving rise to this appeal began when a 

locally owned dairy in Northern New Jersey sued a large Canadian 

corporation, its affiliates, and several New Jersey dairies 

purchased by the corporation in the 1980s. The plaintiff, Ideal 

Dairy Farms, Inc. ("Ideal"), filed a complaint that raised breach 

of contract, tort, fraud, RICO, and antitrust claims. One of the 

defendants, Tuscan Dairy Farms ("Tuscan"), filed a counterclaim 

against Ideal seeking payment of unpaid invoices totalling over 

$2 million. 

 After extensive discovery proceedings, defendants moved 

for summary judgment on their counterclaim and on all of Ideal's 

twenty-five claims. The district court granted summary judgment 

dismissing the claims against the defendants on the basis of its 

finding that Ideal failed to raise a genuine issue of material 

fact. It also granted summary judgment in favor of defendants on 

their counterclaim and awarded Tuscan $2,264,333.71. Ideal 

appealed the district court's summary judgment order. 

 With regard to Ideal's claims involving the 1985 supply 

contract between Tuscan and Ideal, we believe that Ideal has 

sufficiently demonstrated that genuine issues of material fact 

exist that preclude summary judgment. As a result, we will 

reverse and remand the following claims: 

 (1) Breach of Contract (Eleventh Count); 

 (2) Breach of Implied Covenant of Good Faith (Twelfth 

 Count); and 

 (3) Tortious Interference with Contract (Fourteenth 

 Count). 

With regard to all other remaining claims, we find that summary 

judgment was properly granted against Ideal. We will therefore 

affirm the district court's order dismissing all of the antitrust 

claims, the common law fraud and RICO claims, and the tort claims 

not involving the 1985 supply contract. 

 I. 

 The appellant, Ideal, is a New Jersey corporation owned 

by Mark Greenberg and Gil Levine. Ideal distributes processed 

dairy products to retail customers and to customers in the food 

service industry. In the mid-1980s, the Labatt corporation, a 

Canadian entity with major interests in the beer and dairy 

industries, began acquiring dairies in the United States. For 

example, in Northern New Jersey, Labatt acquired Tuscan and 

Johanna Dairy Farms ("Johanna"). Labatt also purchased smaller 

dairy plants in Northern New Jersey, which it either consolidated 

with other more efficient plants or shut down. 

 In 1985, Ideal found itself in need of a new processed 

milk supplier and entered into negotiations with Tuscan. Tuscan 

purchases raw dairy products from farmers and processes them for 

sale to retail and industrial customers, as well as to 
distributors like Ideal. At that time, Tuscan was owned by Lou 

Caiola. Mr. Caiola submitted a proposed supply contract to Ideal 

for its consideration. Joint App. 316-23 ("1985 contract"). 

Ideal had no part in the preparation of the contract and signed 

the contract without making any changes to the text. The 

contract covered pricing and payment requirements but contained 

no clause providing for a term after which the contract would 

expire, nor did it discuss how the contract could be terminated. 

Mark Greenberg admitted at his deposition that, when they signed 

the contract, he and Mr. Levine were aware that the contract had 

"no length" and that they were "satisfied with no period of 

time." Joint App. 527 & 529. 

 The 1985 contract provided that "[a]ll milk and milk 

product prices [would be] based upon [the February 1985] Federal 

Milk Marketing Order." See Joint App. 317 (1985 contract, 

paragraph 2). The Federal Milk Marketing Order sets the minimum 

"Class I" price that a processor must pay to a farmer. The 

contract further provided that future prices could be adjusted 

whenever the Department of Agriculture changed Class I prices and 

also when "documentable or industrywide cost[s]" increased or 

decreased. Id. Such price adjustments were to be "consistent 

with generally accepted industry practice." Id. In addition to 

those adjustments, the contract also allowed Tuscan to add "an 

additional amount equal to 10% of [any] increase or decrease" 

after April 1, 1986. Id. 

 Labatt purchased Tuscan Dairy in December 1986. Lou 

Caiola continued to manage Tuscan's business, however, until 

October 1987. At that time, Herbert England, a Labatt employee, 

was appointed to replace Mr. Caiola. England was in charge at 

Tuscan until 1988, when he was replaced by Robert Facchina who 

ran the business for the remainder of Tuscan's relationship with 

Ideal. 

 Every day, Ideal ordered products from Tuscan. Every 

night, Tuscan loaded the order onto Ideal's trucks so that Ideal 

could deliver its cargo to customers the following morning. 

Every week, Tuscan sent Ideal an invoice of its purchases. Ideal 

responded by paying the invoices, meticulously subtracting for 

any product not received, or received but substandard. Every 

month, for nearly seven years, Tuscan sent Ideal notice of any 

upcoming price changes. Often these notices included a statement 

explaining the price changes and a newly revised price list of 

Tuscan's offerings. 

 Soon after it began doing business with Tuscan, Ideal 

realized that Tuscan was charging prices well above expected 

contract prices. Beginning in 1987, Tuscan began steadily 

increasing prices, usually blaming the increases on various 

premiums charged by farmers, cooperatives, and state governments. 

For example, Tuscan increased Ideal's prices in 1987 claiming 

that RCMA, a dairy farmers' cooperative, had increased the 

premium that it charged in addition to the Class I price. Later, 

when RCMA reduced its premium, Ideal never received the benefit 

of the cost decrease. Ideal discovered this overcharging by 

reading certain industry bulletins that publish actual changes in 

premiums charged by various raw milk suppliers. 
 Ideal first complained to Lou Caiola in 1987 that these 

price increases violated the terms of the 1985 contract, and for 

the next five years, Ideal continued to complain about the 

overcharges to Mr. Caiola's successors. At times, management at 

Tuscan promised that, if Ideal was patient, it would get the 

decrease that was due. At other times, Tuscan's management 

refused to discuss the issue. 

 At a meeting held on March 2, 1990, Tuscan's management 

attempted to rationalize its prices by comparing them, on a 

blackboard, to price increases authorized under the 1985 

contract. In the end, Tuscan was unable to show on the 

blackboard that it had been increasing prices in compliance with 

the contract's pricing formula. Instead, the blackboard 

calculations highlighted the extent of Tuscan's overcharging. 

Mr. Facchina terminated the meeting and refused to discuss prices 

further. 

 Because Labatt owned all of the dairies capable of 

handling Ideal's supply needs, Mr. Greenberg and Mr. Levine 

believed that they were stuck with Tuscan. They doubted that 

they could obtain a better price elsewhere. Therefore, they 

concluded that they had no choice but to pay the overcharges. In 

addition, a New Jersey regulation hampered Ideal's ability to 

shop freely for a milk supplier who might offer a lower price. 

Section 2:52-3.1 of the New Jersey Administrative Code requires 

that milk dealers give milk suppliers two weeks notice before 

changing their source of supply. N.J. Admin. Code, tit. 2,  52- 

3.1 (1996). This regulation combined with Labatt's control of 

several local dairies deterred Ideal from taking its business 

elsewhere, and Ideal's management begrudgingly continued to pay 

the price increases. 

 In late 1990, Tuscan began pressuring Ideal to enter a 

new contract with a five or six year term. Tuscan informed Ideal 

that, under a new policy implemented at all Labatt-owned dairies, 

all customers would be required to enter new contracts. Ideal 

successfully delayed signing a new agreement and secretly began 

looking for a new supply arrangement. 

 In May 1992, Ideal began to negotiate with Cumberland 

Farms dairy ("Cumberland"). Initially, Ideal sought only to 

acquire a certain size container, which Tuscan had discontinued. 

Cumberland, however, refused to supply just the one item but 

offered to supply Ideal with all of its product needs. Once they 

entered negotiations, Ideal also began building its own depot in 

Newark, where it could refrigerate products after hauling them 

from Cumberland's South Jersey premises. 

 On June 12, 1992, Ideal opened its own depot and began 

receiving supplies from Cumberland. It abruptly severed its 

relationship with Tuscan, leaving 15 invoices unpaid. Also in 

June 1992, Ideal commenced this lawsuit against Labatt, its 

affiliates, and the Labatt-owned dairies, alleging violations of 

antitrust, contract, fraud, and tort law. The district court 

granted the defendants motion for summary judgment and ordered 

Ideal to pay the unpaid invoices, thereby awarding Tuscan a total 

of $2,264,333.71. Ideal appeals the district court's summary 

judgment orders. 
 II. 

 The standard of review applied to the appeal of an 

order granting summary judgment is firmly established. "An 

appellate court reviews the district court's grant of summary 

judgment de novo, applying the same standard as the district 

court. This requires that [the court] view the underlying facts 

and all reasonable inferences therefrom in the light most 

favorable to the party opposing the motion." Pennsylvania Coal 

Ass'n v. Babbitt, 63 F.3d 231, 236 (3d Cir. 1995) (citation 

omitted; emphasis added); see also Helen L. v. DiDario, 46 F.3d 

325, 329 (3d Cir.), cert. denied, 116 S.Ct. 64 (1995); Valhal 

Corp. v. Sullivan Assocs., Inc., 44 F.3d 195, 200 (3d Cir. 1995); 

Goodman v. Mead Johnson & Co., 534 F.2d 566, 573 (3d Cir. 1976), 

cert. denied, 429 U.S. 1038 (1977). 

 Summary judgment should be granted only if a court 

concludes that "there is no genuine issue as to any material fact 

and that the moving party is entitled to judgment as a matter of 

law." Fed. R. Civ. P. 56(c). The moving party bears the burden 

of proving that no genuine issue of material fact is in dispute. 

Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 

574, 586 n.10 (1986). Once the movant has carried its initial 

burden, the nonmoving party "must come forward with 'specific 

facts showing that there is a genuine issue for trial.'" Id. at 

587 (quoting Fed. R. Civ. Proc. 56(e)) (emphasis added in 

Matsushita). The non-movant must present concrete evidence 

supporting each essential element of its claim. Celotex Corp. v. 

Catrett, 477 U.S. 317, 322-23 (1986). 

 The question for this court, then, is whether Ideal 

presented sufficient evidence to create a dispute regarding a 

genuine issue of material fact, viewing the evidence in the light 

most favorable to Ideal. Gottshall v. Consolidated Rail Corp., 

56 F.3d 530 (3d Cir. 1995); Big Apple BMW, Inc. v. BMW of N. Am., 

Inc., 974 F.2d 1358, 1363 (3d Cir. 1992), cert. denied, 507 U.S. 

912 (1993); Nathanson v. Medical College of Pennsylvania, 926 

F.2d 1368, 1381 (3d Cir. 1991). "Facts that could alter the 

outcome are 'material', and disputes are 'genuine' if evidence 

exists from which a rational person could conclude that the 

position of the person with the burden of proof on the disputed 

issue is correct." Horowitz v. Federal Kemper Life Assurance 

Co., 57 F.3d 300, 302 n.1 (3d Cir. 1995) (citations omitted). 

 The district court had subject matter jurisdiction over 

the plaintiff's complaint in this case pursuant to 28 U.S.C. 

1301, 15 U.S.C.  1 et seq., 28 U.S.C.  1367, and 18 U.S.C. 

1965. It had pendent jurisdiction over the plaintiff's state law 

claims. This court has jurisdiction to review the district 

court's final order granting summary judgment under 28 U.S.C. 

1291. 

 III. 

 The district court properly granted summary judgment 

dismissing Ideal's fraud and RICO claims, as well as its 

antitrust claims. There is simply not enough concrete evidence 

in the record supporting these claims. However, the district 

court improperly granted summary judgment dismissing Ideal's 

contract claims because genuine issues of material fact do exist. 
 A. 

 In its second amended complaint, Ideal argued that 

Tuscan breached the 1985 supply contract by increasing prices in 

a manner not consistent with the pricing formula established by 

the contract. The district court found that the following facts 

were undisputed: 

 (1) A contract was formed between the parties in 1985, 

 and it contained a price formula; (2) Beginning in 

 1987, the invoices Tuscan sent to Ideal did not follow 

 the price formula in the contract; (3) Ideal complained 

 about this failure to comply with [the] contract price 

 formula numerous times; (4) Tuscan told Ideal that the 

 invoice prices were the prices it was charging, and 

 that Ideal could take its business elsewhere if it 

 wanted; and (5) Ideal continued to order products from 

 Tuscan at the invoice prices, not contract prices, for 

 a period of five years. 

Slip Op. at 19. The court found that there were three possible 

ways to construe these facts: 

 (1) the contract was intact from its formation until 

 June of 1992 and Tuscan continually breached the 

 contract from 1987 on; (2) the contract was intact from 

 its formation until June of 1992, but the price term 

 was modified by the invoices and Ideal's payment on 

 them; or (3) the original signed contract was 

 terminated in 1987, and from the point of termination 

 on the parties formed a new contract each time Ideal 

 ordered goods, Tuscan sent them an invoice, and Ideal 

 made a payment based on that invoice. 

Id. at 20. 

 "Summary judgment may not be granted . . . if there is 

a disagreement over what inferences can be reasonably drawn from 

the facts even if the facts are undisputed." Nathanson, 926 F.2d 

at 1380 (citing Gans v. Mundy, 762 F.2d 338, 340 (3d Cir.), cert. 

denied, 474 U.S. 1010 (1985)). In addition, "[a]ny 'unexplained 

gaps' in materials submitted by the moving party . . ., if 

pertinent to material issues of fact, justify denial of a motion 

for summary judgment." Ingersoll-Rand Financial Corp. v. 

Anderson, 921 F.2d 497, 502 (3d Cir. 1990) (quoting O'Donnell v. 

United States, 891 F.2d 1079, 1082 (3d Cir. 1989)). Finding 

three possible constructions of the facts suggests that there is 

a genuine issue of material fact about which a jury could 

reasonably disagree. The court's finding of factual ambiguity 

should have ensured that the contract claim proceed to trial. 

 It is well-established that "the inferences to be drawn 

from the underlying facts . . . must be viewed in the light most 

favorable to the party opposing the motion." Matsushita, 475 

U.S. at 587-88 (citing United States v. Diebold, Inc., 369 U.S. 

654, 655 (1962)). In this case, however, instead of allowing a 

jury to decide which interpretation of the facts was correct, the 

district court chose a favored interpretation. Moreover, it 

chose an interpretation that favors the movant over the nonmovant. 

 The district court immediately rejected the idea that 
the 1985 supply contract had been modified by the regular 

submission and payment of invoices. It based its rejection on a 

provision of the contract that explicitly prohibits modification 

by a course of conduct without a signed writing. Joint App. 321- 

322 (1985 Contract, para. 14). Between the two remaining 

constructions, the district court held that the third option was 

"the correct one." Id. 

 The court held that "as a matter of law, the 1985 

Contract was terminated by the departure in 1987 from the pricing 

terms set forth in that contract." Slip Op. at 23 (emphasis 

added). In support of its holding, the court pointed out that 

the agreement was an at-will contract because it provided for no 

term. The court concluded that, by overcharging, Tuscan "did 

seemingly indicate [its] termination of the agreement by [its] 

actions." Id. Thus, the district court held that the at-will 

contract was terminated in 1987, and from 1987 until 1992, the 

parties re-contracted each time Tuscan offered a new invoice and 

Ideal accepted by payment. Id. The court held therefore that, 

even if Ideal had a claim for breach of contract by termination 

without reasonable notice, that claim was barred under the fouryear statute of limitations for contract claims. 

 We find that the district court improperly resolved a 

genuine issue of material fact. The district court's finding 

that the contract was terminated by implication in 1987 is not 

the only inference that could reasonably be drawn from the facts. 

Viewing the facts in a light most favorable to Ideal, Tuscan's 

management did not indicate that the contract was "meaningless" 

or "not valid" until late 1990. At that time, Labatt implemented 

a policy that required Tuscan to enter new supply contracts with 

all buyers. According to the record, Tuscan began to press Ideal 

to sign a new agreement in late 1990 or early 1991. See Joint 

App. 576-88 & 1061. 

 Until late 1990, Tuscan's management did its best to 

justify the price increases in a manner that was consistent with 

the 1985 contract pricing provisions. For instance, at the March 

2, 1990, meeting, Mr. Facchina attempted to show on a blackboard 

that its prices complied with the terms of the 1985 contract. 

This conduct is not consistent with the district court's finding 

that the contract was terminated prior to 1990. Rather, by using 

the 1985 contract as a guide to proper pricing, Tuscan expressed 

its belief that the contract was operative at the time of the 

March 2, 1990, meeting. 

 By 1991, it is logical to conclude that Tuscan had 

indicated its unilateral termination of the 1985 contract. Ideal 

filed this suit in June 1992. Ideal may therefore have a valid 

contract claim that is not time-barred by the statute of 

limitations applied to contract claims. Because a reasonable 

jury could find that the termination occurred in 1990 or 1991, 

rather than in 1987, summary judgment should not have been 

granted. 

 In sum, we find that the district court did not view 

the facts in a light most favorable to Ideal, the non-movant, 

when it concluded that the contract was unilaterally terminated 

by conduct in 1987. The court's order granting summary judgment 
against Ideal on its breach of contract claim will therefore be 

reversed and remanded. 

 B. 

 In a single sentence, the district court explained its 

dismissal of Ideal's claim alleging breach of the contract's 

implied covenant of good faith. The court said, "It is obvious 

that defendants cannot have violated good faith by their 'denial 

of the existence of the Contract,' when the contract was 

terminated prior to their denial by the change in the prices 

charged by defendants." Slip Op. at 27-28. The court therefore 

granted the defendants' motion for summary judgment. 

 As discussed above, a reasonable jury could find that 

the supply contract was terminated, not by the prices charged in 

Tuscan's invoices, but by Tuscan's more explicit repudiation of 

the contract in late 1990. If the contract was not terminated by 

its conduct prior to Tuscan's express denial, but rather was 

terminated by the express denial itself, Ideal may indeed have a 

claim for breach of the good faith covenant. At any rate, there 

is a fundamental chronological dispute which presents a genuine 

issue of material fact relevant to Ideal's claim that Tuscan 

breached the contract's implied covenant of good faith. 

 This factual discrepancy was improperly resolved by the 

district court on summary judgment and should have been preserved 

for resolution by a jury. Therefore, the court's dismissal of 

Ideal's claim that Tuscan breached the 1985 contract's covenant 

of good faith will also be reversed and remanded. 

 C. 

 The same temporal dispute requires reversal of the 

district court's order granting summary judgment on Ideal's 

tortious interference with contract claim. The district court 

held that "[b]ecause Ideal brought its tortious interference with 

contract claim more than two years after the contract was 

terminated without reasonable notice," its claim was barred by a 

two-year statute of limitations. Slip Op. at 31. 

 The court's conclusion was based on its finding that 

the contract was terminated in 1987. As we previously concluded, 

the facts may be reasonably interpreted to support a finding that 

the contract was not terminated until late 1990 or early 1991. 

If a jury found that the contract was not terminated until late 

1990, the statute of limitations may not bar Ideal's tortious 

interference claim. Therefore, summary judgment was improperly 

granted, and the court's order will be reversed and remanded. 

 IV. 

 The district court properly granted summary judgment 

dismissing the balance of Ideal's claims. 

 A. 

 The district court did not err in dismissing Ideal's 

claim that Tuscan committed fraud by departing upward from the 

1985 contract's pricing scheme. Under New Jersey law, a 

plaintiff claiming fraud must prove that it detrimentally relied 

on an intentionally misleading statement made by the defendant. 

See, e.g., John Hancock Mutual Life Ins. Co. v. Cronin, 51 A.2d 2 

(N.J. Err. & App. 1947). Ideal admitted however that, early in 

its relationship with Tuscan, it became aware that the invoice 
prices were higher than the prices envisioned in the contract. 

Ideal cannot now claim that it detrimentally relied on Tuscan's 

intentional misrepresentation because Ideal knew it was being 

overcharged for purchases almost from the start. Therefore, the 

district court properly found that Ideal had no cause of action 

in fraud. 

 B. 

 For very similar reasons, Ideal cannot make out a claim 

for violation of the federal RICO statute, 18 U.S.C.  1961 etseq., nor 

for violation of New Jersey's RICO Act. N.J. Stat.

Ann. 2C:41-1 et seq. As the fraudulent predicate acts required 

by both state and federal RICO statutes, Ideal argued that Tuscan 

committed mail and wire fraud. However, the district court found 

that there could be no finding of fraud in light of Ideal's 

admission that, early in the relationship, it knew that Tuscan 

was not complying with the contract. Therefore, the district 

court held that Ideal could "not rely on fraud as a predicate act 

for purposes of Federal RICO," nor for purposes of New Jersey 

RICO. Slip Op. at 18-19. 

 We agree that Ideal cannot make out a claim for mail or 

wire fraud. Indeed, no fraudulent act occurred in this case. 

Without a predicate act, Ideal cannot possibly succeed on its 

federal and state RICO claims. These claims were therefore 

properly dismissed. 

 C. 

 The district court also dismissed Ideal's claim that 

Tuscan tortiously interfered with its prospective economic 

advantage. In support of its claim, Ideal alleged that Tuscan 

undermined its relationships with customers by offering them 

extremely low prices and that Tuscan told Ideal to stay away from 

certain new retailers. 

 The district court found that Ideal failed to present 

evidence of each essential element of its interference claim. 

With regard to Ideal's allegation that Tuscan undermined its 

relationship with a customer, the court found that 

 Tuscan entered into an agreement with Ideal to return 

 the customer and to make supplemental payments to 

 Ideal. This in effect eliminated any claim for 

 tortious interference, substituting a contractual 

 obligation. 

Joint App. 462 (Dist. Ct. Op. 29). With regard to the 

allegations that Tuscan employees interfered by warning Ideal to 

stay away from certain prospective customers, the court found no 

evidence of injury because "Ideal . . . failed to put forward 

evidence that it was even interested in any of [those] accounts . 

. .." Id. 

 To establish a claim of tortious interference with 

prospective economic advantage, Ideal must present concrete 

evidence that Tuscan intentionally and maliciously interfered 

with a "protectable right," and that Tuscan's interference caused 

injury. Printing Mart -- Morristown v. Sharp Electronics Corp., 

563 A.2d 31, 37 (N.J. 1987). "A complaint must demonstrate that 

a plaintiff was in 'pursuit' of business." Id. First, Ideal has 

not shown that it was in serious pursuit of the new accounts 
targeted by Tuscan. Second, the allegations made by Ideal fail 

to reach the necessary level of maliciousness. Id. ("[M]alice is 

defined to mean that the harm was inflicted intentionally and 

without justification or excuse."). Tuscan admitted that it was 

wrong to solicit Ideal's customer and voluntarily gave the 

account back to Ideal. Third, Ideal has not shown that "'if 

there had been no interference[,] there was a reasonable 

probability that [it] would have received the anticipated 

economic benefits.'" Id. (quoting Leslie Blau Co. v. Alfieri, 

384 A.2d 859 (App. Div.), certif. denied, 391 A.2d 523 (1978)). 

 Thus, we agree with the district court's conclusion 

that Ideal failed to establish a claim for tortious interference 

with prospective economic advantage. Summary judgment dismissing 

this claim was properly granted. 

 D. 

 We also agree with the district court's finding that 

Ideal failed to present sufficient evidence to support its 

antitrust claims. At one time, the Supreme Court endorsed a 

slightly stricter standard of review when a summary judgment 

order was challenged in an antitrust case. Poller v. Columbia 

Broadcasting System, Inc., 368 U.S. 464, 473 (1962); Harold 

Friedman, Inc. v. Kroger Co., 581 F.2d 1068, 1080 (3d Cir. 1978). 

However, that "special standard" was abandoned in Eastman Kodak 

Co. v. Image Technical Servs., Inc., 112 S.Ct. 2072, 2083 (1992); 

see also Town Sound, 959 F.2d at 481 ("It may be that because 

antitrust cases are so factually intensive that summary judgment 

occurs proportionately less frequently there than in other types 

of litigation, but the standard of F.R.C.P. 56 remains the 

same."). Therefore, the ordinary standard applies. Eastman 

Kodak, 112 S.Ct. at 2083. In order to survive a summary judgment 

challenge, a plaintiff must prove that a genuine issue of 

material fact could be presented at trial, such that a reasonable 

jury could return a verdict for the plaintiff on that issue. 

 1. 

 The district court did not err in dismissing Ideal's 

essential facilities claim. To establish the necessary elements 

of this claim, Ideal was required to show: 

 (1) control of the essential facility by a monopolist; 

 (2) the competitor's inability practically or 

 reasonably to duplicate the essential facility; (3) 

 denial of the use of the facility to a competitor; and 

 (4) the feasibility of providing the facility. 

Delaware Health Care, Inc. v. MCD Holding Co., 893 F. Supp. 1279 

(D.Del. 1995) (citing among others Monarch Entertainment Bureau, 

Inc. v. New Jersey Highway Auth., 715 F. Supp. 1290, 1300 

(D.N.J.) (citations omitted), aff'd 893 F.2d 1331 (3d Cir. 

1989)). 

 The district court properly applied this test and 

concluded: 

 Even if Ideal could demonstrate that defendants 

 monopolized the market, that it was unable to duplicate 

 an essential facility, and that it was feasible for 

 defendants to make the essential facility available to 

 Ideal, Ideal cannot contradict one important fact: 
 defendants did not deny Ideal use of its facility, the 

 third factor. 

Slip Op. at 32. The district court is correct. Almost five 

years after realizing that Tuscan was overcharging it, Ideal's 

business was still located on the premises of Tuscan Dairy Farms. 

The facts in the record show that Ideal was not denied use of 

Tuscan's facilities. 

 Thus, the district court's ruling in favor of 

defendants' motion for summary judgment was proper. Because the 

New Jersey Antitrust Act provides that it should be construed in 

a manner consistent with federal antitrust law, Ideal's parallel 

New Jersey claim was also properly dismissed. See N.J. Stat. 

Ann. 56:9-18. 

 2. 

 Ideal claims that the defendants conspired with 

Elmhurst Dairy to monopolize milk production in New Jersey, in 

violation of  1 of the Sherman Act. 15 U.S.C.  1. The court 

dismissed this claim, finding that Ideal failed to submit anyevidence 

supporting its assertion that defendants conspired with 

Elmhurst. Slip Op. at 36. It also found that Ideal failed to 

present any evidence proving the four essential elements of a  1 

claim set forth in J.F. Feeser, Inc. v. Serv-A-Portion Inc., 909 

F.2d 1524, 1541 (3d Cir. 1990), cert. denied, 499 U.S. 921 

(1991). 

 A plaintiff alleging a  1 violation has a heavy burden 

when opposing a summary judgment motion on that claim. In Tunis 

Bros. Co., Inc. v. Ford Motor Co., 952 F.2d 715 (3d Cir. 1991), 

cert. denied, 505 U.S. 1221 (1992), this court explained: 

"[W]hen an antitrust defendant's conduct is consistent with both 

permissible competition and illegal conspiracy, a plaintiff 'must 

present evidence "that tends to exclude the possibility" that the 

alleged conspirators acted independently' in order to survive a 

motion for summary judgment." Id. at 720 (quoting Matsushita, 475 U.S. at 

588 (quoting Monsanto Co. v. Spray-Rite Serv. Corp., 

465 U.S. 752, 764 (1984))) (emphasis added). 

 Ideal has not excluded the possibility that the 

agreement between Elmhurst and Tuscan was completely legal. 

Although Ideal claimed that the conspiracy was finalized by a 

written agreement between Tuscan and Elmhurst, no such document 

was presented to the court. In fact, the record was so vague 

that the district court could not determine how the alleged 

agreement might restrain trade in violation of the Sherman Act. 

Slip Op. at 36. 

 The district court was correct to conclude that if the 

evidentiary record were reduced to admissible evidence, the 

plaintiff could not carry its burden of proof at trial. Clark v. 

Modern Group Ltd., 9 F.3d 321, 326 (3d Cir. 1993) (holding that 

when opposing summary judgment motion, "plaintiff . . . must 

point to admissible evidence that would be sufficient to show all 

elements of a prima facie case under applicable substantive 

law"). Summary judgment was therefore properly granted on 

Ideal's 1 Sherman Act claim and on its parallel state law claim. 

 3. 

 To survive a summary judgment motion on its Sherman Act 
 2 monopolization claim, Ideal had to show that (1) Labatt 

possessed monopoly power in the relevant market, and that (2) 

Labatt willfully acquired and maintained monopoly power and did 

not acquire its monopoly share due to "growth or development as a 

consequence of a superior product, business acumen, or historical 

accident." Bonjorno v. Kaiser Aluminum & Chemical Corp., 752 

F.2d 802, 808 (3d Cir. 1984), cert. denied, 477 U.S. 908 (1986). 

 The district court held that Ideal had not presented 

sufficient evidence of these essential elements, and it therefore 

granted the defendants' summary judgment motion. The court gave 

two reasons in support of its ruling. First, it held that Ideal 

failed to establish that the relevant geographic market was 

Northern New Jersey. Slip Op. at 41; see also id. at 46. And 

second, it concluded that a showing that Labatt held a market 

share of 47% in New Jersey did not prove the existence of a 

monopoly in Northern New Jersey. Id. at 42. 

 Until the late 1980s, milk dealers faced significant 

regulatory barriers inhibiting free competition between New York 

City and New Jersey. New York enforced regulations which, for 

practical purposes, excluded New Jersey dealers from the City. 

N.Y. Agric. & Mkts. Law  258-c. And New Jersey enforced similar 

regulations protecting its dealers from New York competitors. 

N.J. Admin. Code, tit. 2,  52-6.1 & -6.2. By the 1990s, 

however, both of these regulatory schemes had been challenged in 

federal courts and repealed. Thus, when Ideal filed its 

monopolization claim, these barriers no longer limited its 

potential market to New Jersey. 

 We agree that Ideal's relevant market and market share 

calculations are dubious. Ideal bore the burden of establishing 

the relevant market for purposes of proving its actual monopoly 

claim. Tunis Bros., 952 F.2d at 726. Ideal argued that the 

relevant market was Northern New Jersey or, in the alternative, 

the state of New Jersey. Like the district court, we are not 

convinced that either is the relevant market for milk. Ideal has 

failed to clearly establish the relevant product and geographic 

market necessary to make this claim. 

 Nor has Ideal persuaded this court that Labatt controls 

a monopoly share of either proposed relevant market. Ideal 

estimated that Labatt held 47% of the New Jersey market and then 

extrapolated from that figure an estimate that Labatt controlled 

a larger share of the market in Northern New Jersey. It is 

equally possible that Labatt might hold a smaller share of the 

market in Northern New Jersey. Ideal offered nothing further to 

support its speculations. Even if Ideal had shown that Labatt 

controlled 47% of the New Jersey market, without concrete 

evidence of anticompetitive behavior, this percentage does not 

prove Labatt to be a monopolist in New Jersey, nor in Northern 

New Jersey. Fineman v. Armstrong World Indus., Inc., 980 F.2d 

171, 201 (3d Cir. 1992), cert. denied, 113 S.Ct. 1285 (1993) ("As 

a matter of law, absent other relevant factors, a 55 percent 

market share will not prove the existence of monopoly power."). 

We therefore agree with the district court's conclusion that 

"Ideal fail[ed] to prove that defendants possessed monopoly power 

in any market." Slip Op. at 42. The district court properly 
granted summary judgment. 

 4. 

 To prove the essential elements of its attempted 

monopolization claim, Ideal was required to present concrete 

evidence that (1) Labatt had engaged in predatory or 

anticompetitive conduct with (2) specific intent to monopolize 

and with (3) a dangerous probability of achieving monopoly power. 

See Spectrum Sports, Inc. v. McQuillin, 113 S.Ct. 884, 890-91 

(1993). It is clear that, when considering the "dangerous 

probability" prong of an attempted monopolization claim, a court 

must "inquir[e] into the relevant product and geographic market 

and the defendant's economic power in that market." Id. at 892. 

 Whether a party violates  2 of the Sherman Act by 

"attempt[ing] to monopolize" is "a question of proximity and 

degree." Swift and Co. v. United States, 196 U.S. 375, 402 

(1905). Further, "the conduct of a single firm, governed by  2, 

'is unlawful only when it threatens actual monopolization.'" 

Spectrum Sports, 506 U.S. at 456 (quoting Copperweld Corp. v. 

Independence Tube Corp., 467 U.S. 752 (1984)). As the Supreme 

Court explained: 

 The purpose of the Act is not to protect businesses 

 from the working of the market; it is to protect the 

 public from the failure of the market. The law directs 

 itself not against conduct which is competitive, even 

 severely so, but against conduct which unfairly tends 

 to destroy competition itself. 

Spectrum Sports, 506 U.S. at 458. 

 Even assuming that the relevant market was Northern New 

Jersey, we do not believe that Ideal presented sufficient 

evidence that Labatt posed a dangerous threat of destroying 

competition in the milk industry. We conclude that a higher 

degree and proximity to actual monopolization must be 

demonstrated before an award of treble damages can be seriously 

pursued. Without proving a dangerous probability threatening 

destruction of competition in a clearly defined relevant market, 

the plaintiff may not proceed beyond summary judgment. 

Therefore, we find that the district court properly granted 

summary judgment dismissing Ideal's attempted monopolization 

claim. 

 5. 

 To prove the essential elements of a claim brought 

under  7 of the Clayton Act, Ideal must prove that it has

suffered "injury of the type the antitrust laws were intended to 

prevent." Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 

477, 489 (1977). Ideal claims only that competition in the 

industry has been reduced by Labatt's acquisitions. However, it 

has not proved that it has been injured by the reduction in 

competition. Moreover, there is no evidence in the record 

demonstrating any harm incurred by Ideal. As the district court 

held, such conclusory assertions alone will not support a Clayton 

Act claim. The district court properly granted summary judgment 

on that claim and on Ideal's parallel state law claim. 

 V. 

 Finally, Ideal's civil conspiracy claim was also 
properly dismissed. As discussed above, Ideal failed to present 

sufficient evidence of any conspiracy that allegedly occurred 

between the Labatt-owned dairies and Elmhurst Dairy. Ideal 

additionally claims, however, that the Labatt-owned dairies 

conspired among themselves to obtain a monopoly in the industry. 

It is well-established that subsidiaries cannot illegally 

conspire with a corporate parent under 1 of the Sherman Act. 

Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 777 

(1984) (holding that a corporate parent and its wholly owned 

subsidiary "are incapable of conspiring with each other"). 

Therefore, the district court properly held that the civil 

conspiracy claim should also be summarily dismissed. 

 VI. 

 We will reverse and remand the district court's order 

granting summary judgment on the following three claims brought 

against the defendants by Ideal: (1) the breach of contract 

claim; (2) the breach of the contract's covenant of good faith 

claim; and (3) the tortious interference with contract claim. We 

will affirm the district court's order granting summary judgment 

in favor of defendants on all of the remaining claims. 

 

Ideal Dairy Farms, Inc. v. John Labatt, Ltd., et al., No. 95-5435 

SCIRICA, Circuit Judge, concurring in part and dissenting in part. 

 I respectfully dissent from part III of the majority 

opinion because I believe the district court correctly entered 

summary judgment on Ideal's contract, implied covenant of good 

faith, and tortious interference with contract claims. 

 I. 

 The Ideal-Tuscan relationship spanned seven years from 

1985 to 1992. Its terms were memorialized in a written contract 

(the "1985 Contract") that did not specify a term of duration and 
did not provide for notice of termination or any other 

termination procedure. From almost the beginning of the 

relationship, Tuscan did not comply with the pricing provisions 

of the 1985 Contract. From 1987 onwards, Ideal repeatedly 

complained to Tuscan about price increases and asserted that 

Tuscan's prices were not in accordance with the 1985 Contract. 

But Tuscan's management consistently refused to adjust invoice 

prices in response to Ideal's complaints, and Tuscan told Ideal 

it could take its business elsewhere if it wanted. Nevertheless, 

Ideal continued to order products from Tuscan at invoice prices 

for five more years. 

 On the basis of these undisputed facts, the district 

court granted summary judgment to the defendants. Opinion, Ideal 

Dairy Farms, Inc. v. John Labatt Ltd. et al., No. 92-2469 (D. 

N.J. May 11, 1995). It held that the 1985 Contract was an atwill contract governed by the New Jersey Uniform Commercial Code, 

and, because the contract was at-will, "[it] was terminated [as a 

matter of law] by the departure in 1987 from the pricing terms 

set forth [therein]" Id. at 23. The majority disagrees with the 

district court's legal analysis. It concludes that factual 

issues remain as to when Tuscan terminated the 1985 Contract, and 

believes that Tuscan may have breached the 1985 Contract 

continuously over a three to five year period. 

 II. 

 The 1985 Contract specified no term. Under the New 

Jersey Uniform Commercial Code, a contract of indefinite duration 

"is valid for a reasonable time," but "may be terminated at any 

time by either party." N.J. Stat. Ann.  12A:2-309(2). 

"Termination of a contract by one party . . . requires that 

reasonable notification be received by the other party." N.J. 

Stat. Ann.  12A:2-309(3). 

 The majority concludes that Tuscan may not have 

terminated the 1985 Contract until late 1990, when members of 

Tuscan management informed Ideal that the contract was 

"meaningless" and "not valid." See Majority Opinion at 14. 

Under this interpretation, it would appear that an at-will 

contract cannot be terminated under  12A:2-309(3) unless 

notification is express. I disagree. A party's conduct may also 

terminate an at-will contract. See Lumber Enterprises, Inc. v. 

Hansen, 846 P.2d 1046, 1049-50 (Mont. 1993) ("when [the seller] 

unilaterally raised its prices, it . . . put an end to the 

previous contract between the parties"); Michael Halebian N.J., 

Inc. v. Roppe Rubber Corp., 718 F. Supp. 348, 365 (D.N.J. 1989) 

(under U.C.C.  2-309, refusal to continue to supply goods in 

accordance with the terms of an at-will contract terminates the 

contract, not breaches it). Termination through conduct may not 

provide the reasonable notice required by  12A:2-309(3), but 

failure to give reasonable notice does not mean the contract 

continues ad infinitum. Rather the aggrieved party is entitled 

to damages arising from the failure to give reasonable notice. 

See Ronald A. Anderson, Uniform Commercial Code  2-309:27 at 555 

(1982) ("When a contract is terminable at any time on notice and 

it is terminated without notice, the damages which the aggrieved 

party may recover are limited to those sustained during the 
notice period."). 

 In this case, Tuscan's pricing diverged from the 

contractual provision in 1987 at the latest. Ideal knew it was 

being charged a greater amount than that called for by the 

contract and repeatedly complained. In response, Tuscan clearly 

demonstrated--both by refusing to change its pricing and through 

specific statements--that it would not comply with the 1985 

Contract. Therefore the contract was terminated at that time. 

While Tuscan failed to provide Ideal with reasonable notification 

of termination, its consistent refusal to abide by the terms of 

the contract terminated the contract. Cf. Agway v. Ernst, 394 

A.2d 774 (Maine 1978) (where buyer was unaware of changes in 

price made by seller, at-will contract was breached and not 

terminated). Ideal could have recovered damages for Tuscan's 

failure to provide reasonable notification, but it filed suit 

after the statute of limitations had run. I would affirm the 

district court's entry of summary judgment on Ideal's claim for 

breach of contract. 

 III. 

 Because Ideal's implied covenant of good faith and 

tortious interference with contract claims derive from its 

contract claim, I would grant summary judgment on those claims as 

well. 

 IV. 

 For the foregoing reasons, I respectfully dissent.