Opinion ID: 1368925
Heading Depth: 4
Heading Rank: 2

Heading: Prejudice to CHS and Hardship to the Betzes.

Text: CHS claims it would be prejudiced by allowance of the amendment, listing several factors: (1) added expense; (2) the need for additional discovery; (3) a lengthier or more burdensome trial; (4) the raising of new issues; (5) the loss of evidence and the dimming of memories; and (6) further delay in resolving the dispute. CHS has failed to show any significant prejudice. One misperception relied upon by CHS goes to several of the above factors. CHS incorrectly asserts that the AS 45.50.564 [4] (Sherman 2) claim brings the complicated issues of product/service and geographic market definition and harm to competition into the case for the first time. CHS apparently assumes that such issues are not raised in AS 45.50.562 (Sherman 1) cases. In order to prevail under a Sherman 1 type claim, however, the plaintiff must show both 1) the existence of a `contract, combination ... or conspiracy,' and 2) an unreasonable restraint of trade under either the per se rule or the rule of reason, as appropriate. Rothery Storage & Van Co. v. Atlas Van Lines, 597 F. Supp. 217, 225 (D.D.C. 1984) aff'd, 792 F.2d 210 (D.C. Cir.1986), cert. denied, ___ U.S. ___, 107 S.Ct. 880, 93 L.Ed.2d 834 (1987). Under the per se doctrine power is not an issue; the conduct involved in per se cases so blatantly restrains competition and is so lacking in any redeeming virtue that it is conclusively presumed to be unreasonable. L. Sullivan, Antitrust § 70, at 192-94 (1977) (hereinafter Sullivan). This, however, is not a case, such as price fixing, division of markets or group boycotts, in which courts customarily have applied the per se rule. Sullivan, §§ 70, 79-92. By contrast: [V]irtually all courts applying the rule of reason require the plaintiff to define the product and geographic market in which competition is allegedly restrained and to show, at a minimum, that the defendants play a significant role in that market. VII P. Areeda, Antitrust Law ¶ 1503, at 376 (1986). Thus, since this case could foreseeably have received rule of reason rather than per se treatment, the issues of market definition and harm to competition were raised from the beginning. Moreover, when the court dismissed the Betzes' claim under AS 45.50.562, the Betzes had already made known their intent to rely on AS 45.50.564. CHS's claim that evidence on this issue may have disappeared or witnesses' memories may have faded is not particularly compelling. CHS had notice of the probable relevance of such evidence from the start and could well have taken steps to preserve it. CHS also claims prejudice from the addition of the issues of intent to violate the antitrust laws and predatory conduct. Intent can be inferred from predatory or anticompetitive conduct. White & White, Inc. v. American Hospital Supply Corp., 723 F.2d 495, 507 (6th Cir.1983); Richter Concrete Corp. v. Hilltop Concrete Corp., 691 F.2d 818, 826 (6th Cir.1982); William Inglis & Sons Baking Co. v. ITT Continental Baking Co., Inc., 668 F.2d 1014, 1027-28 (9th Cir.), cert. denied, 459 U.S. 825, 103 S.Ct. 57, 74 L.Ed.2d 61 (1982); Hunt-Wesson Foods, Inc. v. Ragu Foods, Inc., 627 F.2d 919, 926 (9th Cir.1980), cert. denied, 450 U.S. 921, 101 S.Ct. 1369, 67 L.Ed.2d 348 (1981); Murphy Tugboat Co. v. Shipowners & Merchants Towboat Co., Ltd., 467 F. Supp. 841, 851 (N.D.Cal. 1979), aff'd, 658 F.2d 1256 (9th Cir.1981), cert. denied, 455 U.S. 1018, 102 S.Ct. 1713, 72 L.Ed.2d 135 (1982). Whether CHS's conduct should be considered sufficiently predatory does not require any additional fact finding. Once it is established exactly what CHS did, requiring CHS to apply a new legal theory to those facts is not the kind of prejudice that should defeat an amendment. See Wright v. Vickaryous, 598 P.2d at 495. Thus, of the factors CHS cites in its attempt to show prejudice, the need for additional discovery, the raising of new issues, the loss of evidence, and the dimming of memories are not compelling. Equally unpersuasive is CHS's argument that allowing the amendment might further delay the trial since the trial was put over a year anyway. There is no evidence that a year would be insufficient time to prepare to try this new claim. On the other hand, as compared to a straight contract case, the addition of the antitrust claim probably would increase expenses and make for a lengthier or more burdensome trial. But these factors are not as compelling as they otherwise might be since CHS has been on notice of the Betzes' intent to assert a monopolization claim from the beginning. Balanced against the prejudice to CHS is the hardship to the Betzes. If they are not allowed to amend and take advantage of the relation back doctrine they will be unable to bring their antitrust claim separately since it is time barred. AS 45.50.588. Moreover, the treble damages available under the antitrust statutes afford significantly different relief than that available under traditional contract theory. If the Betzes have a meritorious claim they lose the opportunity to win treble damages if the amendment is denied. We hold that the hardship to the Betzes occasioned by denial of their amendment is great while the prejudice to CHS from allowing it is not substantial. Given the strong policy that a plaintiff ought to be afforded the opportunity to test his claim on the merits, Foman v. Davis, 371 U.S. at 182, 83 S.Ct. at 230, 9 L.Ed.2d at 226, the balance weighs in favor of allowing the amendment.