Opinion ID: 436135
Heading Depth: 3
Heading Rank: 3

Heading: Dismissal of Trela's Antitrust Counterclaim

Text: 27 Trela's antitrust counterclaim is also premised on Winterland's use of the courts. Relying on the Noerr-Pennington doctrine, Winterland argues that the counterclaim was properly dismissed, because its use of the courts was, it claims, for the proper purpose of protecting its property rights. 28 The Supreme Court has held that bona-fide attempts to influence the actions of a legislative body are immune from antitrust scrutiny regardless of any anticompetitive motives behind those attempts. Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961); United Mine Workers v. Pennington, 381 U.S. 657, 85 S.Ct. 1585, 14 L.Ed.2d 626 (1961). The Court extended Noerr-Pennington immunity to good-faith attempts to secure legitimate goals through use of the courts in California Motor Transport v. Trucking Unlimited, 404 U.S. 508, 92 S.Ct. 609, 30 L.Ed.2d 642 (1972). 29 The immunity from antitrust liability conferred by Noerr-Pennington does not extend, however, to litigation which is merely a sham. Id. at 512-13, 92 S.Ct. at 612-13. But as we have noted before, [t]he Noerr and Pennington cases themselves provide little definition of what a 'sham' may be other than to indicate immunity for 'genuine efforts' and 'good faith' attempts to influence governmental bodies. MCI Communications v. American Tel. & Tel., 708 F.2d 1081, 1155 (7th Cir.), cert. denied, --- U.S. ----, 104 S.Ct. 234, 78 L.Ed.2d 226 (1982). 30 Trela claims that Winterland's conduct falls into the sham exception to Noerr-Pennington immunity. The gravamen of Trela's counterclaim is that Winterland, through a variety of tactics, deliberately denied Trela access to the courts in order to avoid a judicial determination of the nature and extent of its alleged property rights. The counterclaim alleges that Winterland repeatedly sought and obtained so-called John Doe ex parte restraining orders, intended to be used to restrain Trela's T-shirt operation, even though Winterland knew Trela's identity when it requested ex parte relief. Trela further alleges that Winterland purposely delayed filing actions until the day before a licensor's scheduled performance and then repeatedly dismissed such actions against Trela after the concert was over and the market value for his products had been severely reduced. Trela claims that Winterland's purpose in proceeding in this manner was to avoid an adjudication on the merits of its property rights while simultaneously eliminating Trela as a competitor during performances. 4 31 As this court has previously noted, [I]t has long been thought that litigation could be used for improper purposes even where there is probable cause for the litigation; and if the improper purpose is to use litigation as a tool for suppressing competition in the antitrust sense ... it becomes a matter for antitrust concern. Grip-Pak, Inc. v. Illinois Tool Works, Inc., 694 F.2d 466, 472 (7th Cir.1982). In analogizing sham litigation to the tort of abuse of process, the court in Grip-Pak stated, The line [between protected and unprotected litigation] is crossed when [the defendant's] purpose is not to win a favorable judgment against a competitor but to harass him, and deter others, by the process itself--regardless of outcome--of litigating. Id. See Note, Limiting the Antitrust Immunity for Concerted Attempts to Influence Courts and Adjudicatory Agencies: Analogies to Malicious Prosecution and Abuse of Process, 86 Harv.L.Rev. 645, 732-35 (1973). One court has explained the sham litigation exception in words directly applicable to Trela's counterclaim: 32 Without a doubt, the intention to harm a competitor is not sufficient to make litigation ... a sham. That anticompetitive motive is the very matter protected under Noerr-Pennington. Rather, the prerequisite motive for the sham exception is the intent to harm one's competitors not by the result of the litigation but by the simple fact of the institution of the litigation. 33 Gainesville v. Florida Power & Light Co., 488 F.Supp. 1258, 1265-66 (S.D.Fla.1980) (emphasis in original). 34 We express no opinion on the ultimate merit of Trela's claim that Winterland violated the antitrust laws. But his allegations that Winterland's interest was not in obtaining a judgment, but eliminating a competitor, are sufficiently supported to allow him to survive a motion to dismiss for failure to state a claim. Accordingly, we reverse the district court's dismissal of the antitrust counterclaim.