Opinion ID: 475821
Heading Depth: 2
Heading Rank: 1

Heading: Proper Parties to Bring Antitrust Claims

Text: 14 The district court's judgment on the antitrust claims was based on the lack of standing of the plaintiffs, Lucas and Bigbey. 6 The court held that they could not prove they suffered a direct injury resulting from a lessening of competition in the target area, the market for the design and construction of nuclear power plants. Lucas and Bigbey claim that Ostrofe v. H.S. Crocker Co., 740 F.2d 739 (9th Cir.1984), cert. dismissed, 469 U.S. 1200, 105 S.Ct. 1155, 84 L.Ed.2d 309 (1985), controls and requires us to reverse the summary judgment. Bechtel contends that Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 103 S.Ct. 897, 74 L.Ed.2d 723 (1983), supports the propriety of the summary judgment. 15 We review summary judgments de novo. Golden v. Faust, 766 F.2d 1339, 1340 (9th Cir.1985). Summary procedures in antitrust litigation should be used sparingly, at least where motive and intent are important factors, Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962), and the moving party is subject to a 'particularly rigorous' burden in antitrust cases. Aydin Corp. v. Loral Corp., 718 F.2d 897, 902 (9th Cir.1983) (quoting Mutual Fund Investors, Inc. v. Putnam Management Co., 553 F.2d 620, 624 (9th Cir.1977)). Nevertheless, we will not squander judicial resources by requiring that anyone who files an antitrust complaint setting forth a valid cause of action be entitled to a full-dress trial notwithstanding the absence of any significant probative evidence tending to support the complaint. First National Bank of America v. Cities Service Co., 391 U.S. 253, 290, 88 S.Ct. 1575, 1593, 20 L.Ed.2d 569 (1968).
16 Lucas and Bigbey sought relief under sections 4 and 16 of the Clayton Act. Section 4 allows recovery of treble damages by any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws. 15 U.S.C. Sec. 15(a) (1982). Read literally, this provision could afford relief to all persons whose injuries are causally related to an antitrust violation. Recognizing the nearly limitless possibilities of such an interpretation, however, the judiciary quickly brushed aside this construction. In re Multidistrict Vehicle Air Pollution, 481 F.2d 122, 125 (9th Cir.), cert. denied, 414 U.S. 1045, 94 S.Ct. 551, 38 L.Ed.2d 336 (1973). As we recently explained, [a]lthough the language of section 4 is very broad, Congress did not intend to provide a private remedy for all injuries that might conceivably be traced to an antitrust violation. Bubar v. Ampco Foods, Inc., 752 F.2d 445, 448 (9th Cir.) (citing Blue Shield of Virginia, Inc. v. McCready, 457 U.S. 465, 472-80, 102 S.Ct. 2540, 2544-49, 73 L.Ed.2d 149 (1982)), cert. denied, --- U.S. ----, 105 S.Ct. 3481, 87 L.Ed.2d 616 (1985). 17 This unwillingness to recognize every actual or threatened economic loss attributed to an antitrust violation is consistent with the fundamental principle that the antitrust laws protect competition as a whole, not individual competitors. See Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 488, 97 S.Ct. 690, 697, 50 L.Ed.2d 701 (1977); see also Alaska Teamsters Local 959 v. Atlantic Richfield Co., 616 F.Supp. 593, 597 (D.Alaska 1985). 18 Accordingly, the courts have limited the ability of injured parties to recover under the Clayton Act through the creation of restrictions on standing. This doctrine of antitrust standing requires an inquiry beyond that performed to determine standing in a constitutional sense. Harm to the antitrust plaintiff is sufficient to satisfy the constitutional standing requirement of injury in fact, but the court must make a further determination whether the plaintiff is a proper party to bring a private antitrust action. Associated General Contractors of California v. California State Council of Carpenters, 459 U.S. 519, 535 n. 31, 103 S.Ct. 897, 907 n. 31, 74 L.Ed.2d 723 (1983). 19 Bubar, 752 F.2d at 448. In making this determination, the infinite variety of claims that may arise make it virtually impossible to announce a black-letter rule that will dictate the result in every case. Associated General Contractors, 459 U.S. at 536, 103 S.Ct. at 907. Instead, previously decided cases identify factors that circumscribe and guide the exercise of judgment in deciding whether the law affords a remedy in specific circumstances. Id. at 537, 103 S.Ct. at 908. The factors identified by the Supreme Court are: (1) whether the plaintiff's alleged injury is the type the antitrust laws were intended to forestall; (2) the directness of the injury; (3) the speculative measure of the harm; and (4) keeping the scope of complex antitrust trials within judicially manageable limits. Id. at 538-45, 103 S.Ct. at 908-12. 20 The first factor is of tremendous significance. Bhan v. NME Hospitals, Inc., 772 F.2d 1467, 1470 n. 3 (9th Cir.1985). The requirement that the alleged injury be related to anticompetitive behavior requires, as a corollary, that the injured party be a participant in the same market as the alleged malefactors. Id. at 1470 (citing Associated General Contractors, 459 U.S. at 538, 539, 103 S.Ct. at 909). It is conceded by Lucas and Bigbey that they were neither Bechtel's competitors nor consumers in the market for the design and construction of nuclear power plants. Thus, this factor weighs heavily against them, although they contend that the defendants engaged in an intentional secondary conspiracy to depress wages in the electrician labor market in order to effect the primary conspiracy, and that they are participants in this market. But the Supreme Court in Associated General Contractors found that injury arising from an analogous labor situation was tenuous because it was not clear whether the plaintiffs' interests would be served or disserved by enhanced competition in the market. 459 U.S. at 539, 103 S.Ct. at 909. In Associated General Contractors, the Court denied standing to a union that alleged the defendant association of building and construction contractors conspired to restrain the union's business activities by coercing general contractors, landowners, and others to deal with nonunion contractors. The Court stated that although the anticompetitive conduct was directed at certain third-parties, the union had not been injured in its business or property since it was neither a consumer nor a competitor in the restrained market, and because there was no nexus between the quality of competition in the target area and the welfare of the union. Id. at 527-29, 538-39, 103 S.Ct. at 902-04, 908-09. 21 The second factor, the directness of the injury, also weighs heavily against finding that Lucas and Bigbey are the proper parties to bring suit. Here, as in Associated General Contractors, the chain of causation (between their injury and the alleged restraint in the market for nuclear plant construction) contains several somewhat vaguely defined links. Id. at 540, 103 S.Ct. at 909. Lucas and Bigbey allege that the Stabilization Agreement was intended to restrain trade by imposing low wages for electricians, in furtherance of the larger conspiracy to monopolize the market for nuclear plant construction. Their claimed injury derives from the depressed wages. 7 Moreover, Bechtel's competitors are much more immediate victims of the alleged conspiracy, and an action by them would encounter none of the conceptual difficulties that encumber the [plaintiffs'] claim. Id. at 541-42, 103 S.Ct. at 910-11. The existence of an identifiable class of persons whose self-interest would normally motivate them to vindicate the public interest in antitrust enforcement diminishes the justification for allowing a more remote party such as the [plaintiffs] to perform the office of a private attorney general. Id. at 542, 103 S.Ct. at 910. Bechtel's competitors are such an identifiable class with the requisite motivation. Finally, the Court noted that the indirectness of the alleged injury also implicates the strong interest ... in keeping the scope of complex antitrust trials within judicially manageable limits. Id. at 543, 103 S.Ct. at 911. 22 The third Associated General Contractors factor, the speculative nature of the harm, also strongly supports the district court's decision. The Court in Associated General Contractors focused on the nature of the union's injury, id. at 538, 103 S.Ct. at 908, and noted that increased competition among employers for projects tends to depress wages. Id. at 539 & n. 41, 103 S.Ct. at 909 & n. 41. That applies here as well. As the Supreme Court explained, uninhibited competition among employers striving to reduce costs in order to obtain a competitive advantage over their rivals, id. at 539, 103 S.Ct. at 909, may actually work against the goals of organized labor, particularly if one method of reducing costs is the use of a non-union labor force. Thus, the Stabilization Agreement may have preserved union jobs, because it is contended that, without that agreement, the Arizona Public Services Company would have awarded the contract to a non-union employer. 23 As a fourth factor, the Supreme Court has identified the strong interest ... in keeping the scope of complex antitrust trials within judicially manageable limits. Id. at 543, 103 S.Ct. at 911. This factor may be analyzed in one of several ways--the importance of avoiding either the risk of duplicative recoveries ... or the danger of complex apportionment of damages. Id. at 534-44, 103 S.Ct. at 906-12. We do not find the same kinds of risk of duplicative recoveries or complex apportionment of damages in the present case as those discussed in Associated General Contractors. See id. at 544, 103 S.Ct. at 911 (e.g., Hanover Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481, 88 S.Ct. 2224, 20 L.Ed.2d 1231 (1968) (refusing to allow defendants to discount plaintiffs' damages claim to the extent that overcharges were passed on to plaintiffs' customers); Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977) (potential plaintiffs at each level of distribution chain asserting conflicting claims to common fund)). 24 Of course, the Supreme Court did not explicitly state that a plaintiff must satisfy all of the Associated General Contractors factors, or, indeed, any particular factor. Bhan, 772 F.2d at 1470 n. 3. Even so, this case also implicates the goal of keeping complex antitrust suits within judicially manageable limits. As previously discussed, Lucas and Bigbey claim they were injured by illegally depressed wages as a consequence of the conspiracy to restrain trade by imposing artificially low wages for electricians. But this alleged conspiracy is secondary to the alleged conspiracy to monopolize interstate commerce in the design and construction of nuclear power plants. Therefore, Lucas and Bigbey assert claims for higher wages as employees of the union with whom Bechtel contracted. On the other hand, it is Bechtel's competitors who would have the direct claim to antitrust damages. The direct and indirect claims are not duplicative in the sense of asserting conflicting claims to a common fund; nevertheless, the determination and proof of these damages would be very complex. 8 We hold in any event that [a]lthough the policy against duplicative recoveries may not apply to the ... type of harm asserted in [the plaintiff's] brief ... the remote and obviously speculative character of that harm is plainly sufficient to place it beyond the reach of Sec. 4. Associated General Contractors, 459 U.S. at 545 n. 52, 103 S.Ct. at 912 n. 52. 25 Thus, all of the four factors of Associated General Contractors support the holding that Lucas and Bigbey are not proper parties to bring this suit. Lucas and Bigbey claim that Associated General Contractors is inapposite. Instead, they rely on Ostrofe v. H.S. Crocker Co., 740 F.2d 739 (9th Cir.1984), cert. dismissed, 469 U.S. 1200, 105 S.Ct. 1155, 84 L.Ed.2d 309 (1985). 9 In Ostrofe, a former employee of an alleged co-conspirator alleged that he was discharged and boycotted from further employment in the target industry because he had refused to participate in a necessary step in a conspiracy to reduce price competition. We granted standing because (1) the injury was directly caused by an intentional boycott which stemmed from a violation of antitrust policy; (2) the injury was of a type antitrust laws were intended to prevent; and (3) as an immediate victim of the antitrust violation, Ostrofe was its natural vindicator. Id. at 742-43. We cannot find that Lucas' and Bigbey's alleged injuries were directly caused by an intentional boycott; their injuries were not an integral and inextricable part of the anticompetitive scheme. Id. at 746. As noted above, Lucas and Bigbey are not the natural vindicators of the claimed antitrust violation; denying them standing is not likely to leave a significant antitrust violation undetected or unremedied. Associated General Contractors, 459 U.S. at 542, 103 S.Ct. at 910. Thus, Lucas and Bigbey are not the proper parties to assert the antitrust claims under section 4.
26 Lucas and Bigbey also seek injunctive relief under section 16 of the Clayton Act. That section provides in part: 27 Any person, firm, corporation, or association shall be entitled to sue for and have injunctive relief, in any court of the United States having jurisdiction over the parties, against threatened loss or damage by a violation of the antitrust laws, ... when and under the same conditions and principles as injunctive relief against threatened conduct that will cause loss or damage is granted by courts of equity, under the rules governing such proceedings, and upon ... a showing that the danger of irreparable loss or damage is immediate, a preliminary injunction may issue.... 28 15 U.S.C. Sec. 26 (1982). We have recognized that the standing requirements under this section are less stringent than those under section 4. Bubar, 752 F.2d at 449 n. 2; Lucas v. Bechtel Corp., 633 F.2d 757, 760 (9th Cir.1980) (Lucas I ); see also Parks v. Watson, 716 F.2d 646, 662 (9th Cir.1983). Because plaintiffs under section 16 are not seeking treble damages but only equitable relief, and because no complex issues of damages or speculative or duplicative recovery problems arise, all that is required is a showing of a threatened loss or injury cognizable in equity proximately resulting from the alleged antitrust violation. Parks, 716 F.2d at 662 (citing City of Rohnert Park v. Harris, 601 F.2d 1040, 1044 (9th Cir.1979), cert. denied, 445 U.S. 961, 100 S.Ct. 1647, 64 L.Ed.2d 236 (1980)). Injury need not be to business or property nor within the target area of the alleged anticompetitive conduct. Id. See also 2 P. Areeda & D. Turner, Antitrust Law Sec. 335e (1978). Lucas and Bigbey have alleged that they have suffered the continuing loss of benefits of the Inside Agreement as a proximate result of the anticompetitive conduct of defendants. 29 The district court did not specifically address this section 16 contention, but there is enough evidence in the record for us to review its ultimate holding of lack of standing. Even assuming that Lucas' and Bigbey's injury was proximately caused by the alleged antitrust violation, we must still be able to find that their injury is cognizable in equity. This we are unable to do. 30 Section 16 provides injunctive relief under the same principles as generally applied by courts of equity. American Passage Media Corp. v. Cass Communications, Inc., 750 F.2d 1470, 1472 (9th Cir.1985). Traditional equitable criteria require the plaintiff to show either (1) a likelihood of success on the merits and the possibility of irreparable injury, or (2) the existence of serious questions going to the merits and the balance of hardships tipping in its favor. Apple Computer, Inc. v. Formula International Inc., 725 F.2d 521, 523 (9th Cir.1984). These two formulations represent two points on a sliding scale in which the required degree of irreparable harm increases as the probability of success decreases.... Under any formulation of the test, plaintiff must demonstrate that there exists a significant threat of irreparable injury. Oakland Tribune, Inc. v. Chronicle Publishing Co., 762 F.2d 1374, 1376 (9th Cir.1985) (citing American Passage, 750 F.2d at 1473). 31 The injury alleged is the loss of monetary benefits claimed under the Inside Agreement. Nowhere do Lucas and Bigbey claim irreparable harm. Their complaint and depositions indicate that diminution of wages is their sole injury. Even if we accept Lucas' and Bigbey's contention that the loss includes hourly wages in addition to travel and subsistence pay, the injury involves only monetary harm. Monetary damages are not usually sufficient to establish irreparable harm. American Passage, 750 F.2d at 1473-74. Lucas and Bigbey make no other supportable claim of injury cognizable in equity and therefore lack standing under section 16. 10 It is thus unnecessary to decide whether they are likely to succeed on the merits. Oakland Tribune, 762 F.2d at 1376. Although the district court did not base its decision on this specific point, we may affirm on any ground finding support in the record. Islamic Republic of Iran v. Boeing Co., 771 F.2d 1279, 1288 (9th Cir.1985).