Opinion ID: 764884
Heading Depth: 4
Heading Rank: 3

Heading: News & Observer

Text: 81 The News & Observer entered into its affiliation agreement with AD/SAT on August 15, 1986; in February 1993, the paper decided to temporarily unplug its AD/SAT recorder due to renovations at the paper that caused space constraints. After disconnecting the equipment, Richard Lee Henderson, the vice-president in charge of sales and marketing, noticed that the paper had received no complaints from advertisers regarding the unavailability of AD/SAT's delivery service. In the fall of 1993, Henderson learned that AD/SAT's corporate parent was filing for bankruptcy. Believing that this prospect was grounds for terminating the News & Observer's affiliation agreement with AD/SAT, Henderson, advertising director James McClure, and W.L. Mack McCormick, the local sales manager, decided to terminate the agreement. This decision was communicated to AD/SAT by letter dated November 24, 1993. 82 AD/SAT's then-president, Atkins, told the paper that AD/SAT did not consider bankruptcy a valid grounds for termination under the contract; nevertheless, the paper reiterated its intention to exercise its right to terminate the agreement in a letter dated January 20, 1994. This letter was written five days after Lawrence Blasko of the AP visited the paper and introduced AdSEND. AD/SAT continued to contest the News & Observer's right to terminate the affiliation agreement and, after consulting with its lawyers, the paper decided that paying the $7,500 annual affiliation fee would be less costly than a legal battle. Upon AD/SAT's insistence that the affiliation agreement so required, the paper re-installed the AD/SAT recorder at its offices. 83 AD/SAT points to the following facts in its attempt to implicate the News & Observer in the alleged conspiracies: (i) the paper's president, Frank Daniels, Jr., was chairman of the board of the AP during the development, approval, and implementation of AdSEND; (ii) five days after Blasko's visit, the paper reconfirmed its intention to terminate its relationship with AD/SAT; and (iii) during a conversation between AD/SAT president Hilton and Daniels on June 15, 1994, Daniels purportedly stated, I don't think that we will be doing business together, we're a beta [test] site for Ad/Send. 84 Contrary to AD/SAT's arguments, this evidence does not support the inference that the News & Observer joined in a concerted refusal to deal with AD/SAT. Rather, the evidence shows that the paper -- because it was dissatisfied with AD/SAT's service -- expressed its desire to terminate its affiliation agreement well before anyone at the paper had heard of AdSEND and before the conspiracies alleged by AD/SAT supposedly came into existence. Furthermore, the outcome would be no different even if the paper had decided to terminate its AD/SAT affiliation after the paper's employees learned of AdSEND; the decision to terminate a service that was both costing the paper money and not bringing in additional revenue, and to install an alternative, cost-free service, does not give rise to an inference of an unlawful conspiracy in restraint of trade. 85 The District Court properly granted summary judgment in favor of this defendant. 86