Source: https://m.openjurist.org/451/us/630/texas-industries-inc-v-radcliff-materials-inc
Timestamp: 2019-05-25 23:02:15
Document Index: 503967123

Matched Legal Cases: ['§ 1', '§ 4', '§ 1', '§ 1', '§ 50', '§ 206', '§ 2000', '§ 301', '§ 185', '§ 1', '§ 11', '§ 77', '§ 9', '§ 78', 'art, 435', '§ 15', '§ 7', '§ 7', '§ 4', '§ 5', '§ 16']

451 US 630 Texas Industries Inc v. Radcliff Materials Inc | OpenJurist
451 U.S. 630 - Texas Industries Inc v. Radcliff Materials Inc
451 US 630 Texas Industries Inc v. Radcliff Materials Inc
68 L.Ed.2d 500
101 S.Ct. 2061
TEXAS INDUSTRIES, INC., Petitioner,
Petitioner and respondents manufacture and sell ready-mix concrete. A purchaser of concrete from petitioner filed a civil action against petitioner in Federal District Court, alleging that petitioner and certain unnamed firms had conspired to raise concrete prices in violation of § 1 of the Sherman Act, and seeking treble damages under § 4 of the Clayton Act. After learning through discovery that respondents were the alleged co-conspirators, petitioner filed a third-party complaint against them, seeking contribution should it be held liable in the original action. The District Court dismissed the third-party complaint for failure to state a claim upon which relief could be granted, holding that federal law does not allow an antitrust defendant to recover any contribution from alleged co-conspirators. The Court of Appeals affirmed.
This case presents the question whether the federal antitrust laws allow a defendant, against whom civil damages, costs, and attorney's fees have been assessed, a right to contribution from other participants in the unlawful conspiracy on which recovery was based. We granted certiorari to resolve a conflict in the Circuits. 449 U.S. 949, 101 S.Ct. 351, 66 L.Ed.2d 213 (1980).1 We affirm.
* Petitioner and the three respondents manufacture and sell ready-mix concrete in the New Orleans, La., area. In 1975, the Wilson P. Abraham Construction Corp., which had purchased concrete from petitioner, filed a civil action in the United States District Court for the Eastern District of Louisiana naming petitioner as defendant;2 the complaint alleged that petitioner and certain unnamed concrete firms had conspired to raise prices in violation of § 1 of the Sherman Act, 26 Stat. 209, as amended, 15 U.S.C. § 1, which provides in relevant part:
Through discovery, petitioner learned that Abraham believed respondents were the other concrete producers that had participated in the alleged price-fixing scheme.4 Petitioner then filed a third-party complaint against respondents seeking contribution from them should it be held liable in the action filed by Abraham. The District Court dismissed the third-party complaint for failure to state a claim upon which relief could be granted, holding that federal law does not allow an antitrust defendant to recover in contribution from co-conspirators. The District Court also determined there was no just reason for delay with respect to that aspect of the case and entered final judgment under Federal Rule of Civil Procedure 54(b).
The common law provided no right to contribution among joint tortfeasors. Union Stock Yards Co. v. Chicago, B. & Q. R. Co., 196 U.S. 217, 25 S.Ct. 226, 49 L.Ed. 453 (1905); W. Prosser, Law of Torts § 50, pp. 305-307 (4th ed. 1971). See Merryweather v. Nixan, 8 Term Rep. 186, 101 Eng.Rep. 1337 (K.B.1799). See also Northwest Airlines, Inc. v. Transport Workers, 451 U.S. 77, 86-87, n. 16, 101 S.Ct. 1571, 1578, n. 16, 67 L.Ed.2d 750. In part, at least, this common-law rule rested on the idea that when several tortfeasors have caused damage, the law should not lend its aid to have one tortfeasor compel others to share in the sanctions imposed by way of damages intended to compensate the victim. E. g., Atkins v. Johnson, 43 Vt. 78, 81-82 (1870). See Leflar, Contribution and Indemnity Between Tortfeasors, 81 U.Pa.L.Rev. 130, 130-134 (1932). Since the turn of the century, however, 39 states and the District of Columbia have fashioned rules of contribution in one form or another, 10 initially through judicial action and the remainder through legislation. See Northwest Airlines, Inc. v. Transport Workers, 451 U.S., at 86-87, and n. 16, 101 S.Ct., at 1578, and n. 16. Because courts generally have acknowledged that treble-damages actions under the antitrust laws are analogous to common-law actions sounding in tort,5 we are urged to follow this trend and adopt contribution for antitrust violators.
Proponents of a right to contribution advance concepts of fairness and equity in urging that the often massive judgments in antitrust actions be shared by all the wrongdoers. In the abstract, this position has a certain appeal: collective fault, collective responsibility. But the efforts of petitioner and supporting amici to invoke principles of equity presuppose a legislative intent to allow parties violating the law to draw upon equitable principles to mitigate the consequences of their wrongdoing. Moreover, traditional equitable standards have something to say about the septic state of the hands of such a suitor in the courts, and, in the context of one wrongdoer suing a co-conspirator, these standards similarly suggest that parties generally in pari delicto should be left where they are found. See supra, at 2063.7
Respondents and amici opposing contribution point out that an even stronger deterrent may exist in the possibility, even if more remote, that a single participant could be held fully liable for the total amount of the judgment. In this view, each prospective co-conspirator would ponder long and hard before engaging in what may be called a game of "Russian roulette."8 Moreover, any discussion of this problem must consider the problem of "overdeterrence," i. e., the possibility that severe antitrust penalties will chill wholly legitimate business agreements. See United States v. United States Gypsum Co., 438 U.S. 422, 441-442, 98 S.Ct. 2864, 2875-2876, 57 L.Ed.2d 854 (1978).
The parties and amici also discuss at length how a right to contribution should be structured and, in particular, how to treat problems that may arise with the allocation of damages among the wrongdoers and the effect of settlements. Dividing or apportioning damages among a cluster of co-conspirators presents difficult issues, for the participation of each in the conspiracy may have varied. Some may have profited more than others; some may have caused more damage to the injured plaintiff. Some may have been "leaders" and others "followers"; one may be a "giant," others "pygmies."9 Various formulae are suggested: damages may be allocated according to market shares, relative profits, sales to the particular plaintiff, the role in the organization and operation of the conspiracy, or simply pro rata, assessing an equal amount against each participant on the theory that each one is equally liable for the injury caused by collective action. In addition to the question of allocation, a right to contribution may have a serious impact on the incentive of defendants to settle. Some amici and commentators have suggested that the total amount of the plaintiff's claim should be reduced by the amount of any settlement with any one co-conspirator; others strongly disagree. Similarly, vigorous arguments can be made for and against allowing a losing defendant to seek contribution from co-conspirators who settled with the plaintiff before trial. Regardless of the particular rule adopted for allocating damages or enforcing settlements, the complexity of the issues involved may result in additional trial and pretrial proceedings, thus adding new complications to what already is complex litigation. See, e. g., Illinois Brick Co. v. Illinois, 431 U.S. 720, 737-747, 97 S.Ct. 2061, 2070-2075, 52 L.Ed.2d 707 (1977).
Earlier this Term, in Northwest Airlines, Inc. v. Transport Workers, 451 U.S. 77, 101 S.Ct. 1571, 67 L.Ed.2d 750, we addressed the similar question of a right to contribution under the Equal Pay Act of 1963, 29 U.S.C. § 206(d), and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. We concluded that a right to contribution may arise in either of two ways: first, through the affirmative creation of a right of action by Congress, either expressly or by clear implication; or, second, through the power of federal courts to fashion a federal common law of contribution. 451 U.S., at 90-91, 101 S.Ct., at 1580.10
Petitioner readily concedes that "there is nothing in the legislative history of the Sherman Act or the Clayton Act to indicate that Congress considered whether contribution was available to defendants in antitrust actions." Brief for Petitioner 10. Moreover, it is equally clear that the Sherman Act and the provision for treble-damages actions under the Clayton Act were not adopted for the benefit of the participants in a conspiracy to restrain trade. On the contrary, petitioner "is a member of the class whose activities Congress intended to regulate for the protection and benefit of an entirely distinct class," Piper v. Chris-Craft Industries, Inc., 430 U.S. 1, 37, 97 S.Ct. 926, 947, 51 L.Ed.2d 124 (1977) (emphasis added). The very idea of treble damages reveals an intent to punish past, and to deter future, unlawful conduct, not to ameliorate the liability of wrongdoers. The absence of any reference to contribution in the legislative history or of any possibility that Congress was concerned with softening the blow on joint wrongdoers in this setting makes examination of other factors unnecessary. California v. Sierra Club, supra, at 298, 101 S.Ct., at 1781; Touche Ross & Co. v. Redington, supra, at 574-576, 99 S.Ct., at 2488. We therefore conclude that Congress neither expressly nor implicitly intended to create a right to contribution.11 If any right to contribution exists, its source must be federal common law.
The vesting of jurisdiction in the federal courts does not in and of itself give rise to authority to formulate federal common law, United States v. Little Lake Misere Land Co., 412 U.S. 580, 591, 93 S.Ct. 2389, 2396, 37 L.Ed.2d 187 (1973), nor does the existence of congressional authority under Art. I mean that federal courts are free to develop a common law to govern those areas until Congress acts. Rather, absent some congressional authorization to formulate substantive rules of decision, federal common law exists only in such narrow areas as those concerned with the rights and obligations of the United States,12 interstate and international disputes implicating the conflicting rights of States or our relations with foreign nations,13 and admiralty cases.14 In these instances, our federal system does not permit the controversy to be resolved under state law, either because the authority and duties of the United States as sovereign are intimately involved or because the interstate or international nature of the controversy makes it inappropriate for state law to control.
Federal common law also may come into play when Congress has vested jurisdiction in the federal courts and empowered them to create governing rules of law. See Wheeldin v. Wheeler, supra, at 652, 83 S.Ct., at 1445. In this vein, this Court has read § 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a), not only as granting jurisdiction over defined areas of labor law but also as vesting in the courts the power to develop a common law of labor-management relations within that jurisdiction. Textile Workers v. Lincoln Mills, 353 U.S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972 (1957). A similar situation arises with regard to the first two sections of the Sherman Act, which in sweeping language forbid "[e]very contract, combination . . ., or conspiracy, in restraint of trade" and "monopoliz[ing], or attempt[ing] to monopolize, . . . any part of the trade or commerce . . . ." 15 U.S.C. §§ 1, 2. We noted in National Society of Professional Engineers v. United States, 435 U.S. 679, 688, 98 S.Ct. 1355, 1363, 55 L.Ed.2d 637 (1978):
Accord, United States v. United States Gypsum Co., 438 U.S., at 438, and n. 14, 98 S.Ct., at 2874, and n. 14; 2 P. Areeda & D. Turner, Antitrust Law ¶ 302 (1978). See 21 Cong.Rec. 2456, 2460, 3149, 3152 (1890).15
That Congress knows how to define a right to contribution is shown by the express actions for contribution under § 11(f) of the Securities Act of 1933, 15 U.S.C. §§ 77k(f), and §§ 9(e) and 18(b) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78i(e) and 78r(b). Some courts have extrapolated from these provisions that when an implied right of action exists under the securities laws, there also is an implied right to contribution. See, e. g., Heizer Corp. v. Ross, 601 F.2d 330 (CA7 1979); Globus, Inc. v. Law Research Service, Inc., 318 F.Supp. 955 (SDNY), aff'd, 442 F.2d 1346 (CA2), cert. denied, 404 U.S. 941, 92 S.Ct. 286, 30 L.Ed.2d 254 (1971); De Haas v. Empire Petroleum Co., 286 F.Supp. 809 (Colo.1968), aff'd in part, rev'd in part, 435 F.2d 1223 (CA10 1970). We intimate no view as to the correctness of these decisions; in any event, they do not support implication of a right to contribution when a statute expressly creates a damages action but does not provide for contribution. See Northwest Airlines, Inc. v. Transport Workers, 451 U.S. 77, 91-92, n. 24, 101 S.Ct. 1571, 1580, n. 24, 67 L.Ed.2d 1451.
Section 4 of the Clayton Act, 15 U.S.C. § 15, which provides the private treble-damages action, derives from § 7 of the Sherman Act as originally enacted. See H.R.Rep.No.627, 63d Cong., 2d Sess., pt. 1, p. 14 (1914). Congress repealed the original § 7 in 1955, Act of July 7, 1955, ch. 283, 69 Stat. 282, as being redundant of Clayton Act § 4, H.R.Rep.No.422, 84th Cong., 1st Sess., 2 (1955); S.Rep.No.619, 84th Cong., 1st Sess., 2 (1955).
Clayton Act § 5(a), 15 U.S.C. § 16(a).