Opinion ID: 486483
Heading Depth: 3
Heading Rank: 2

Heading: Impact on Competition in the Tied Market

Text: 34 Appellants also argue that the district court's conclusion that the practice at issue here constituted an illegal tying arrangement is erroneous because the allegedly improper practice did not have a sufficient impact on competition in the tied market to violate the antitrust laws. The parties agree that a tying arrangement will only be illegal if it affects a not insubstantial volume of interstate commerce in the tied market, see Jefferson Parish, supra, 466 U.S. at 16, 104 S.Ct. at 1560; Fortner Enterprises, Inc. v. United States Steel Corp. (Fortner I), 394 U.S. 495, 501, 89 S.Ct. 1252, 1257, 22 L.Ed.2d 495 (1969); Northern Pacific Railway, supra, 356 U.S. at 6, 78 S.Ct. at 518; Amey, Inc., supra, 758 F.2d at 1503, but disagree on how that volume of commerce should be measured in this case and whether that volume is sufficient to bring the conduct challenged here within the scope of the Sherman Act. 35 The Supreme Court has held that for purposes of determining whether the amount of commerce foreclosed in the tied market is insubstantial, the volume of commerce must be substantial enough in terms of dollar-volume so as not to be merely de minimis. Fortner I, 394 U.S. at 501, 89 S.Ct. at 1257. The relevant figure is the total volume of sales tied by the sales policy under challenge, not merely the portion of this total accounted for by the particular plaintiff who brings suit. Id. at 502. As the Supreme Court explained in Fortner I: 36 The requirement that a not insubstantial amount of commerce be involved makes no reference to the scope of any particular market or to the share of that market foreclosed by the tie ... normally the controlling consideration is simply whether a total amount of business, substantial enough in terms of dollar-volume of business so as not to be merely de minimis, is foreclosed to competitors by the tie ... 37 394 U.S. at 501, 89 S.Ct. at 1257. The Court further explained this standard in Jefferson Parish, stating that [i]f only a single purchaser were 'forced' with respect to the purchase of a tied item, the resultant impact on competition would not be sufficient to warrant the concern of antitrust law. 466 U.S. at 16, 104 S.Ct. at 1560. 38 Appellants argue that the district court found that only one promoter would have chosen TXP in the absence of the tying arrangement and that the loss of that promoter cost TXP only $10,091.07 in single damages. They argue that the foreclosure of a single competitor to the tune of $10,091.07 is not a substantial enough impact on commerce to implicate the antitrust laws. Appellee, on the other hand, argues that the relevant figure is the total volume of sales in the tied product market--here, the total sales of tickets to musical concerts for the relevant period. Those figures, the appellee argues, which range between 9 and 13.5 million dollars for a four-year period, do have a substantial impact on commerce. 39 It is clear that the relevant figure is the total volume of sales in the tied market, but not so clear is whether the sales in the tied market in this case would be the amount of ticket sales actually proven to be tied, which would be the ticket agency's profit from Jim Veal's ticket sales, or the amount representing all ticket sales resulting from the challenged practice, which would be the ticket agency's profits from all ticketing services rendered for events at the Omni during the relevant period of the lawsuit. We need not resolve this question, however, because we conclude that the not insubstantial amount of interstate commerce test is met even by the smallest figure proffered, the $10,091.07 in actual damages to TXP flowing from Jim Veal's promotions. Compare Microbyte Corp. v. New Jersey State Golf Association, 51 Antitrust & Trade Reg.Rep. (CCH) at 8 (D.N.J.1986) ($27,264 in one year not de minimis ); AAMCO Automatic Transmissions, Inc. v. Tayloe, 407 F.Supp. 430, 436 (E.D.Pa.1976) ($50,000 over 4 years not de minimis ) with Amey, Inc., supra, 758 F.2d at 1503 ($325 fee insubstantial amount of commerce). The $10,091.07 figure represents an estimate of TXP's profits from providing ticket-selling services for seven different events promoted by Jim Veal--tickets sold by SEATS that would have been sold by TXP but for the tying arrangement. Although an actual tying violation was proved as to only one promoter, it involved seven different events and therefore seven different tying violations. While $10,091.07 is not an overwhelmingly large amount, particularly compared with the 9-13.5 million in total ticket sales over the relevant period, it is certainly more than de minimis.