Opinion ID: 545572
Heading Depth: 3
Heading Rank: 3

Heading: Evaluation of the Unreasonable Restraint of Trade

Text: 43 Allegations Under the Per Se Rule or the Rule 44 of Reason 45 To the extent that the district court held that a split agreement should be evaluated under the rule of reason because it constituted a non-price restraint of trade, the court erred. It should have applied the illegal per se rule. 5 46 This circuit has recently ruled on this issue. In Harkins, 850 F.2d at 486, we noted that per se treatment is appropriate where joint efforts by firms disadvantage competitors by inducing suppliers or customers to deny relationships the competitors need in order to compete. We concluded that an alleged split agreement, if proven, would be illegal per se. Appellees dispute the appellant's reliance on Harkins on several grounds. First, they claim that the per se rule in that case was only dicta. Second, they claim that all cases finding per se treatment appropriate for a split agreement have demonstrated that the agreement was to depress film rentals to the distributors, eliminate guarantees to those distributors, or otherwise affect the terms of licensing for films, i.e., antitrust injury. Appellees contend that appellants have failed to even allege these factors. One of the cases relied on in Harkins, appellees point out, Northwest Wholesale Stationers, Inc. v. Pacific Stationery & Printing Co., 472 U.S. 284, 105 S.Ct. 2613, 86 L.Ed.2d 202 (1985), supports the proposition that a per se analysis is not appropriate where no antitrust injury has been alleged. The United States Supreme Court in that case found that plaintiff failed to prove an antitrust violation when it demonstrated injury to itself but not to competition. Northwest Wholesale Stationers, 472 U.S. at 297 n. 9, 105 S.Ct. at 2621 n. 9. 47 In the instant case, however, the split agreement is allegedly employed to restrict entry of other exhibitors into the Santa Cruz market for any film. If so, such conduct would cause antitrust injury in the form of a boycott, a conspiracy in restraint of trade in violation of 15 U.S.C. Sec. 1. In fact, in Northwest Wholesale Stationers, 472 U.S. at 294, 105 S.Ct. at 2619, the court opined that in cases of group boycotts that directly or indirectly cut off necessary access to customers or suppliers, the per se rule applies because the likelihood of antitrust injury is clear. 48 On remand, the trial court should instruct the jury accordingly.