Opinion ID: 399873
Heading Depth: 2
Heading Rank: 1

Heading: Effect on United States Commerce

Text: 8 A restraint that directly or substantially affects the flow of commerce into or out of the United States is within the scope of the Sherman Act. See Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 704, 82 S.Ct. 1404, 1413, 8 L.Ed.2d 777 (1962); United States v. Aluminum Co. of America, 148 F.2d 416, 443-44 (2d Cir. 1945) (Alcoa ); 1 J. von Kalinowski, Antitrust Laws and Trade Regulation § 5.02(2)(c) (1980); L. Sullivan, Antitrust 714-16 (1977). A review of the summary judgment submissions and evidence convinces us that defendants have not demonstrated that there is no genuine issue concerning the existence of a direct or substantial effect on United States foreign commerce. See Fed.R.Civ.P. 56(c); Adickes v. S. H. Kress & Co., 398 U.S. 144, 157-61, 90 S.Ct. 1598, 1608-10, 26 L.Ed.2d 142 (1970) (burden on movant). 9 In their briefs prior to the first appeal, defendants' attack on the existence of an effect on United States commerce was only an attack on plaintiffs' pleadings. Defendants placed their own characterization on the complaint and declared that the case involved only the tree-cutting business in Indonesia; thus, they concluded, their conduct had no effect on United States commerce. Plaintiffs had alleged, however, that Mitsui-U.S.A., an American corporation which imports a sizeable amount of lumber or lumber products into the United States, had conspired to keep them out of the business of harvesting trees and exporting logs and lumber from Indonesia to the United States. There was ample evidence in the record to show that Mitsui-U.S.A. had appropriated much of the business that plaintiffs claim they would have derived from the forestry concession: Mitsui-U.S.A. was purchasing the bulk of the logs from the concession and selling them for export to Mitsui-Japan at a substantial profit. 10 The competition between two American importers to obtain a source of supply on foreign territory affects the foreign commerce of the United States. Timberlane Lumber Co. v. Bank of America, 549 F.2d 597, 604-05, 615 (9th Cir. 1976); see Pacific Seafarers, Inc. v. Pacific Far East Line, Inc., 404 F.2d 804, 811-17 (D.C.Cir.1968), cert. denied, 393 U.S. 1093, 89 S.Ct. 872, 21 L.Ed.2d 784 (1969); cf. Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 113 n.8, 89 S.Ct. 1562, 1571 n.8, 23 L.Ed.2d 129 (1969) (American corporation's participation in foreign patent pools); Timken Roller Bearing Co. v. United States, 341 U.S. 593, 71 S.Ct. 971, 95 L.Ed. 1199 (1951) (division of foreign markets by American corporation and its foreign affiliates). Mitsui-Japan was allegedly a co-conspirator in this attempt to restrain competition between two American competitors. Thus, defendants' attack on the pleadings did not make it appear( ) beyond doubt that the plaintiff (could) prove no set of facts in support of his claim which would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957) (motion to dismiss for failure to state a claim), quoted in McLain v. Real Estate Board, 444 U.S. 232, 245, 100 S.Ct. 502, 511, 62 L.Ed.2d 441 (1980) (challenge to jurisdictional element of a Sherman Act claim). 11 After we reversed the district court's first grant of summary judgment, the defendants shifted to a factual attack by arguing that the single, undisputed fact that Mitsui-Japan exported all of the lumber, purchased from Mitsui-U.S.A. in Indonesia, to Japan demonstrated that there was no genuine issue concerning an effect on United States commerce. Mitsui-Japan argued-and this is the argument it advances most strenuously in this court-that when a Japanese business competes with an American business in Indonesia and exports the fruits of that competition solely to Japan, any effect on United States commerce is purely incidental, indirect, and unintentional. Even if defendants' argument is correct-an issue we do not reach-it ignores the allegations in this case. Here, an American corporation with an interest in protection of its import business has allegedly conspired to eliminate a potential American competitor in both the business of purchasing logs in Indonesia and the business of importing lumber and lumber products into the United States. 12 Defendants' showing did not demonstrate that there was no genuine fact issue for the simple reason that defendants' showing was not responsive to plaintiffs' allegations. That one co-conspirator-Mitsui-Japan-followed a course of business action that, in isolation, might not be considered a violation of the United States antitrust laws does not demonstrate either that the effect of the conspiracy as between the American competitors is not an effect on United States commerce or that the intent of the conspiracy was not to restrain competition between the American competitors. (S)ummary procedures should be used sparingly in complex antitrust litigation where motive and intent play leading roles (and) the proof is largely in the hands of the alleged conspirators .... Poller v. CBS, Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962). Summary judgment is even less appropriate here, where there is ample evidence of a conspiracy to keep plaintiffs from becoming a competitor, and plaintiffs have not had an opportunity to depose one of the conspirators on the effect and intent of their efforts.