Opinion ID: 402332
Heading Depth: 2
Heading Rank: 1

Heading: The Section 1 Conspiracy Claim

Text: 30 In order to establish an unlawful conspiracy under Section 1 of the Sherman Act, 15 U.S.C. § 1 (1976), a plaintiff must prove that two or more persons acted in concert to restrain trade. Perma Life Mufflers, Inc. v. International Parts Corp., 392 U.S. 134, 141-42, 88 S.Ct. 1981, 1985-1986, 20 L.Ed.2d 982 (1968); see Fuchs Sugars & Syrups, Inc. v. Amstar Corp., 602 F.2d 1025, 1029 (2d Cir.), cert. denied, 444 U.S. 917, 100 S.Ct. 232, 62 L.Ed.2d 172 (1979). Concerted action need not be proved directly, but can be based upon circumstantial evidence; for example, from inferences drawn from the words and conduct of the parties to the agreement and from their course of dealing, Norfolk Monument Co. v. Woodlawn Memorial Gardens, Inc., 394 U.S. 700, 704, 89 S.Ct. 1391, 1393, 22 L.Ed.2d 658 (1969) (per curiam ); American Tobacco Co. v. United States, 328 U.S. 781, 809-10, 66 S.Ct. 1125, 1138-1139, 90 L.Ed. 1575 (1946). However, at a minimum the circumstances (must be) such as to warrant a jury in finding that the conspirators had a unity of purpose or a common design and understanding, or a meeting of minds in an unlawful arrangement. Michelman v. Clark-Schwebel Fiber Glass Corp., 534 F.2d 1036, 1043 (2d Cir.), cert. denied, 429 U.S. 885, 97 S.Ct. 236, 50 L.Ed.2d 166 (1976) (quoting American Tobacco Co. v. United States, 328 U.S. at 810, 66 S.Ct. at 1139). 31 In the instant case, Brenner asserts that his evidence established, inter alia, that: (1) he had valid contracts to promote an Arguello-Escalera bout; (2) King falsely asserted rights to the fight; (3) Sulaiman and the WBC were aware of the falsity of King's claims; (4) despite this knowledge, the WBC and Sulaiman compelled Brenner to pay King $25,000 in order to obtain WBC certification for the Arguello-Escalera fight; (5) Brenner agreed to pay King, and then King reneged on the agreement by asserting additional terms; (6) when Brenner refused to yield to these new demands made by King, Sulaiman suspended Brenner; and (7) as a result of the suspension, King reaped all of the financial benefits of Brenner's exclusive service contract with Arguello. Reply Br. for Brenner at 3-5. Brenner contends that these facts support a reasonable inference that appellees engaged in a conspiracy to promote the interests of King and to place Brenner at a competitive disadvantage in the promotion of boxing matches. We conclude, however, that Brenner's evidence did not establish each of these facts, and that those facts which were established do not support a reasonable inference of a conspiracy. 32 The evidence taken in the light most favorable to Brenner established that Brenner and Don King competed for the promotion of an Arguello-Escalera rematch, and that both promoters acquired signed contracts for the bout. Then, King predated his contract with Escalera before submitting it to the WBC for approval. Even assuming that King's contracts for the fight were invalid, there is no evidence in the record that the WBC or Sulaiman knew prior to the WBC convention that they were invalid. In addition, despite having contracts signed by both fighters, Brenner neither informed the WBC nor submitted his contracts to it prior to the convention. 33 When the convention assembled in December 1978, it had received only King's contracts for the Arguello-Escalera and Arguello-Chacon fights. The convention nevertheless set these contracts aside, and decreed that in accordance with its mandatory title defense rule, Arguello would have to fight Rafael Bazooka Limon before he could fight Escalera. Soon thereafter, Brenner telephoned Sulaiman, informing him that he had signed contracts for an Arguello-Escalera bout to take place in February 1979. Although the convention had set aside King's contracts for the same fight, Sulaiman promised to reintroduce the matter and thereby aid Brenner in his attempt to establish himself as an independent promoter. After reconsideration, the convention agreed to allow Brenner's Arguello-Escalera bout to take precedence over a Limon bout provided that, inter alia, Brenner settled the dispute over the promotion of the fight with Don King in court or by agreement. 34 Thereafter, Brenner and his attorneys sought to resolve the matter by attempting to prove that King's claims to the fight were invalid. First Brenner and then Roman, Arguello's manager, wrote to Sulaiman challenging the validity of King's contracts. By mid-December 1978, Sulaiman had in his possession both Brenner's and King's contracts for the fight as well as Brenner's exclusive service contract with Arguello. Sulaiman did not, however, side with either of the promoters, but adhered to the terms laid down by the convention. He reiterated this position to Escalera's manager. Ruiz, who, like Brenner and Roman, had attempted to persuade Sulaiman to declare King's contracts invalid. Certainly, Sulaiman owed no duty to Brenner to referee this contest. 35 Once it was evident that Sulaiman would not become involved in determining the validity of the contracts, Brenner attempted to settle with King. He did not negotiate directly, but elicited the assistance of Bob Arum and Sulaiman. Acting as intermediary, Sulaiman was able to persuade King to cut his demand in half. When Brenner was informed of King's counter-offer of a $25,000 settlement he indicated that he would handle the remaining negotiations. Brenner, however, waited one month, until almost the eve of the fight to contact King and to formalize the agreement. During that time, he had instituted a suit seeking to enjoin King from interfering with his promotion of the fight. After the injunction was denied, Brenner sent King a letter confirming the agreement and enclosing a postdated check. 36 Throughout this period, King was attempting to undermine Brenner's ability to promote the fight. First he submitted his fight contracts to CBS, causing the network to cancel its television contract with Brenner. In addition, upon receipt of Brenner's postdated check, King attempted to convince Sulaiman to cancel the fight. Sulaiman refused, adhering to the convention's decision to award Brenner the rights to the fight. When this approach failed, King sent Sulaiman a letter with a copy to Brenner, adding new terms to the agreement. 37 Upon receipt of King's letter, Brenner stopped payment on the check. However, he waited until two days before the fight to inform Sulaiman that payment had been stopped. The bout was held as scheduled. Yet, despite his understanding with the WBC, Brenner never paid King. Furthermore, despite repeated opportunities, he never attempted to explain to the WBC why he had not done so. Three months after the fight, Brenner was suspended by the WBC from promoting championship title fights until he explained his position to the WBC or settled with King. At no time prior to trial did Brenner avail himself of either opportunity. 38 This record does not support a reasonable inference of a conspiracy among appellees and King to advance the interests of King over those of Brenner. Rather, the only conclusion that can be drawn is that the WBC and Sulaiman aided Brenner: they permitted his Arguello-Escalera fight to take precedence despite having denied a similar request by King; Sulaiman acted as intermediary, upon Brenner's request, in settling the dispute with King; and Sulaiman refused to halt the fight when King so requested. Furthermore, the record is devoid of evidence that the WBC and Sulaiman actually knew at any time that King's contracts were defective, if in fact they were. Brenner claims that evidence exposing the falsity of King's claims was furnished to Sulaiman after the convention and consisted of Brenner's exclusive service contract with Arguello and the affirmations made by the managers of both fighters that Brenner was the promoter of the fight. Brenner asserts that once apprised of this evidence, Sulaiman should have disregarded the convention's instructions. We can find no conspiracy in Sulaiman's adherence to the terms laid down by the WBC convention. The WBC convention had decided to take a position of neutrality. In light of the refusal of the court and of CBS to find King's contracts invalid, we can hardly say that Sulaiman's adherence to the convention's mandate was suspect. Neither can we conclude that a determination to allow the parties to settle this matter in court or by agreement should be interpreted as conspiratorial or as the favoring of one promoter over another. 39 Moreover, the record belies Brenner's assertion that he was compelled to settle with King. The convention gave Brenner a choice, to resolve the dispute either in court or by settlement. Brenner pursued both paths, soliciting Sulaiman's aid in negotiating with King while he was seeking a court injunction against King. Only when his litigation failed did he agree to a settlement. 40 Brenner next points to the repeated attempts of Don King to undermine the fight as evidence of the conspiracy. The district court provided the answer when it said that this evidence shows that King isn't a nice guy, the people he deals with don't think he's a nice guy but that doesn't prove that he entered into a conspiracy with Sulaiman to have Brenner suspended. Tr. at 787-7. 41 Brenner attempts to save his deficient conspiracy claim by arguing that the district court erred in allowing Don King to invoke his Fifth Amendment privilege against self-incrimination and in refusing to review the invocation of privilege on a question-by-question basis. Brenner asserts that had King been compelled to testify, sufficient evidence of a conspiracy would have been adduced below. We find no merit in this argument. The district court was aware that King was the subject of a grand jury investigation involving some of the identical claims raised by Brenner, and in its discretion determined that King would be compelled to produce potentially incriminating evidence were he forced to testify. The district court's ruling comports with the standard set forth in Hoffman v. United States, 341 U.S. 479, 486-87, 71 S.Ct. 814, 818, 95 L.Ed. 1118 (1951), that (t)o sustain the privilege, it need only be evident from the implications of the question, in the setting in which it is asked, that a responsive answer to the question or an explanation of why it cannot be answered might be dangerous because injurious disclosure could result. Furthermore, contrary to Brenner's assertion, the district court did solicit challenges to King's invocation of privilege on a question-by-question basis. Brenner presented a list of questions which he planned to ask King were he forced to testify. The district court reviewed the questions and only then concluded that King had properly invoked his Fifth Amendment privilege. 7 There is no error here.