Opinion ID: 195601
Heading Depth: 4
Heading Rank: 2

Heading: Antitrust Defenses

Text: 21 Grumman also claimed that DG could not maintain its infringement action because DG had used its ADEX copyrights to violate Sections 1 and 2 of the Sherman Antitrust Act, 15 U.S.C. Secs. 1 and 2 (1988 & Supp. IV 1992). 12 Specifically, Grumman charged that DG misused its copyrights by (1) tying the availability of ADEX to a consumer's agreement either to purchase DG support services (a positive tie) or not to purchase support services from TPMs (a negative tie), and (2) willfully maintaining its monopoly in the support services aftermarket by imposing the alleged tie-in and refusing to deal with TPMs. 22 Concerning the tying claim, the district court again adopted the reasoning of the Fourth Circuit in STI, this time for the proposition that there was insufficient proof of a tying agreement to withstand summary judgment. Grumman V, 834 F.Supp. at 484-85. The Fourth Circuit held that there was no positive tie for two independent reasons. First, the court noted that DG did not actually license ADEX to its service customers. STI, 963 F.2d at 686-87. Second, the court held that there was not enough evidence to prove that any license to use ADEX was conditioned on the purchase of DG support services. Id. at 687. The court noted that there was no explicit tying condition in any written agreement. Id. The court also noted that there was insufficient evidence of unwilling purchases of DG support service so as to justify an inference of an implicit condition; customers may simply prefer service supported by ADEX diagnostics over service that is not. Id. at 687-88. The court further held that there was insufficient evidence of a negative tie because, on the record before the court, [t]he fact that CMOs do not purchase repair services ... is at least as consistent with the legitimate and independent business decision not to purchase unneeded services as it is with an agreement not to purchase such services. Id. at 686. 23 Judge Skinner conducted his own exhaustive analysis of the monopolization claim, concluding that Grumman failed to assert[ ] any facts that would indicate that DG has engaged in any unlawful exclusionary conduct. Grumman II, 761 F.Supp. at 192. The court essentially narrowed the question to whether DG's restrictive policies with respect to TPMs constitute unlawful unilateral refusals to deal, reasoning that DG's actions do not rise to the level of unlawful exclusionary conduct for several reasons. The court agreed with Grumman that this case, like Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 105 S.Ct. 2847, 86 L.Ed.2d 467 (1985), raises the issue of prior promotion of competition in a market that is later halted, Grumman II, 761 F.Supp. at 190. The district court nonetheless concluded that Grumman had failed to demonstrate that DG's restrictive policies have unreasonably harmed the competitive process. In particular, the court noted that DG's policies with respect to most service products do not prevent TPMs from competing in the service market because DG will sell its service products, except [ADEX and schematics], to any ultimate consumer regardless of whether [the consumer] now or later use[s] a TPM. Id. at 191. The court also observed that TPMs have demonstrated the ability to develop diagnostics [without schematics], even if they are not as efficient as MV/ADEX. Id. Lastly, the court suggested that the Sherman Act would not compel DG to disclose its schematics, in part because such compulsory disclosure would undermine the incentives of copyright and patent laws. Id. at 192. 13 24 In rejecting Grumman's motion for reconsideration of the grant of summary judgment on the monopolization claim, the district court also directly addressed Grumman's contention that DG's refusal to license ADEX to TPMs constitutes exclusionary conduct. The court stated that DG's refusal to license ADEX to TPMs was not exclusionary because DG offers to the public a license to use MV/ADEX on any computer owned by the customer, and therefore DG  'did not withhold from one member of the public a service offered to the rest[.]'  Grumman III, slip op. at 5 (citing Olympia Equip. Leasing Co. v. Western Union Tel. Co., 797 F.2d 370, 377 (7th Cir.1986), cert. denied, 480 U.S. 934, 107 S.Ct. 1574, 94 L.Ed.2d 765 (1987)). 25