Opinion ID: 490525
Heading Depth: 3
Heading Rank: 1

Heading: Parallel Conduct

Text: 38 Much of the evidence in this case concerns the alleged parallel conduct of the defendants. Parallel conduct can be probative evidence bearing on the issue of whether there is an antitrust conspiracy. However, parallel conduct alone will not suffice as evidence of such a conspiracy, even if the defendants knew the other defendant companies were doing likewise. Modern Home Institute, Inc. v. Hartford Accident & Indemnity Co., 513 F.2d 102, 110 (2d Cir.1975). More must be shown. 39 Since mere parallel behavior can be consistent with independent conduct, courts have held that a plaintiff must show the existence of additional circumstances, often referred to as plus factors, which, when viewed in conjunction with the parallel acts, can serve to allow a fact-finder to infer a conspiracy. See id.; In re Plywood Antitrust Litigation, 655 F.2d 627, 633-37 (5th Cir.1981), cert. dismissed, 462 U.S. 1125, 103 S.Ct. 3100, 77 L.Ed.2d 1358 (1983). Such circumstances might include a common motive to conspire or a high level of interfirm communications. See, e.g., In re Plywood Antitrust Litigation, 655 F.2d at 633 (interfirm communications); Ambook Enterprises v. Time Inc., 612 F.2d 604, 616 (2d Cir.1979) (common motive to conspire), cert. dismissed, 448 U.S. 914, 101 S.Ct. 35, 65 L.Ed.2d 1179 (1980). See generally P. Areeda, Antitrust Analysis 371-82 (3d ed. 1981). However, such plus factors may not necessarily lead to an inference of conspiracy. For example, such factors in a particular case could lead to an equally plausible inference of mere interdependent behavior, i.e., actions taken by market actors who are aware of and anticipate similar actions taken by competitors, but which fall short of a tacit agreement. See id. at 374-75. In such a case, a court might find it difficult to hold that the parallel acts tend to exclude the possibility of independent action. 40 As discussed below, see Parts IV.A.2 to IV.A.5 infra, while Apex points to evidence indicating that the long defendants may have been motivated by a desire to make inordinate profits, to to get Apex, this evidence of motivation creates an equally valid inference of independent action. Apex also points to evidence of a number of communications among the defendants. However, aside from the particular communications discussed below, see Part IV.A.2 infra, for the reasons stated by the district court, we believe that inferring a conspiracy from the existence of these communications would amount to speculation under the circumstances herein. See 641 F.Supp. at 1266-69. Accordingly, we believe that in this case Apex must show more. 41 Apex presents evidence which it believes shows that the parallel acts were against the apparent individual economic self-interest of the alleged conspirators. Modern Home Institute, 513 F.2d at 111. Such a showing, if successful, might tend to exclude the possibility of independent parallel behavior. See Bogosian v. Gulf Oil Corp., 561 F.2d 434, 446 (3d Cir.1977), cert. denied, 434 U.S. 1086, 98 S.Ct. 1280, 55 L.Ed.2d 791 (1978); see also Matsushita, supra. See generally 6 P. Areeda,Antitrust Law paragraphs 1415, 1434, at 84-93, 213-21 (1986). 42 Apex argues that it made no economic sense for defendants individually to nominate early. However, the most we can say in support of this position is that the evidence concerning the rationality of nominating early is ambiguous. For example, it is not really controverted that the price of oil was falling in early February 1982. The defendants suggest that this provided them with a good reason to take delivery early; the oil would be more valuable earlier in the month than later. Apex counters that this makes sense only if there was an immediate market for the oil since it costs money to store oil, since the money used to buy the oil early instead could be invested, and since the defendants allegedly already had inventories of oil on hand. However, these costs which might be incurred as a consequence of early delivery were very likely small in comparison with the potential decrease in value of the oil by the end of the month. Apex provides no probative evidence tending to show that defendants would have experienced difficulty in selling the oil after delivery or even that any defendant believed that late delivery would be harmful. Indeed, it was an officer of Apex who testified that in a falling market early delivery was indicated. While Apex presented the testimony of an expert who asserted that the defendants did not need the oil, the expert did not state that taking the oil early would be to the defendants' disadvantage. Since the evidence as to the rationality of nominating early is ambiguous, it appears that we do not have a case where a fact-finder could be allowed to infer from the parallel conduct the existence of a conspiracy in the absence of additional evidence. See id. p 1415b, at 86-87 (question is whether no rational person would engage in the alleged parallel behavior individually) (discussing Modern Home Institute, supra ). 43 This does not mean that evidence of the long defendants' parallel conduct becomes irrelevant, however. A court deciding whether to grant summary judgment should not view each piece of evidence in a vacuum. Seemingly innocent or ambiguous behavior can give rise to a reasonable inference of conspiracy in light of the background against which the behavior takes place. Evidence can take on added meaning when viewed in context with all the circumstances surrounding a dispute. Thus, while we must carefully determine what inferences reasonably may be drawn from each piece of evidence, we must make this determination in light of all of the evidence proffered by Apex.