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

Heading: Apex's Other Evidence

Text: 71 Apex presents a mass of other material that Apex characterizes as evidence of a conspiracy. We have carefully reviewed this evidence and, while we reverse and remand as to the antitrust claims against Belcher for the reasons stated above, and remain aware that  'once a conspiracy is shown, only slight evidence is needed to link another defendant with it,'  Wilkinson, supra, since we do not find such a link, we conclude that affirmance of the grant of summary judgment is appropriate as to the remaining defendants. 72
73 Apex devotes much of its argument to discussing a number of activities engaged in by Sal DiMauro of Triad Petroleum, Inc. and TIC Commodities, Inc. We can find no permissible inference of conspiracy which can be drawn from any of this evidence. 74 Apex first points to an offer on February 1 by Sal DiMauro on behalf of Stinnes to sell Apex 300,000 barrels of oil for approximately 87cents per gallon. This offer was withdrawn ten minutes later after Joseph DiMauro, also of Triad and TIC, spoke to the president of Stinnes. On February 2, Sal DiMauro offered Apex 300,000 barrels from Stinnes at 97 cents. And on February 3, Joseph DiMauro offered Apex 1.5 million barrels at 93.5 cents. Apex wishes us to infer a conspiracy from this. However, Apex offers no evidence tending to show that this sequence was part of any agreement beyond one between Stinnes and its broker, DiMauro. Moreover, the fact that Stinnes used its broker to make the offers does not amount to an illegal conspiracy. A more likely inference from this evidence is that once the market became aware of Apex's delivery obligations, Stinnes and others, as rational sellers, raised the price of oil in order to take advantage of Apex's plight. 75 Apex also argues that Sal DiMauro invited one Jerry Schultz, a trader at Tipco Products, Inc. (Tipco), not a defendant, to participate in a short squeeze. Apex finds support for this proposition in the deposition of Schultz. However, a fair reading of the Schultz deposition leads to no such conclusion. Schultz had heard rumors of an impending short squeeze and discussed this with DiMauro. DiMauro asked Schultz if [Tipco was] going to take delivery early. Schultz replied that Tipco had not yet decided and expressed concern about a lack of storage space. DiMauro suggested that delivery could be worked out. Schultz also asked how to go about nominating early. In response, DiMauro had a representative of TIC explain the nomination process to Schultz. Still unsure of the process, Schultz requested a telex explaining the necessary steps. TIC instead sent a telex to ContiCommodity Inc., Tipco's clearing member at the Exchange, which stated that Tipco planned to take delivery of all of its contracts on February 6. It also stated that final delivery instructions [would] be communicated no later than February 5, 1982. Schultz testified that Tipco never authorized the sending of this telex. 76 One possible explanation for this activity is that DiMauro was soliciting Tipco to join a conspiracy. The problem with this approach is that it assumes that there was a conspiracy of which DiMauro was a member. Apex suggests that Schultz testified that he took the call to be an invitation to participate in a short squeeze along with certain other defendants. However, nothing in the transcript suggests that DiMauro was shown to be part of a conspiracy. Nor does it suggest with which long defendants DiMauro is supposed to have been conspiring. So, even if we assume that DiMauro had invited Tipco to take part in a squeeze, there is no indication that he did so pursuant to an agreement with any particular long defendants. We are therefore unable to conclude that the Schultz deposition tends to exclude the possibility that DiMauro was simply trying to solicit business for his brokerage firm. We conclude that this evidence does not give rise to any permissible inference of a conspiracy under the circumstances herein. 77 Next, Apex points to a conversation between Joseph DiMauro and Slifka of Global on February 4. True, the conversation was followed by the submission by TIC of a nomination on behalf of Stinnes of 300 contracts by inventory transfer at GATX on February 6. However, DiMauro was the broker for a number of the defendants, and it is a normal function for a broker to make transactions on behalf of a client. Further, given that there is no evidence of what was said during the conversation, we cannot conclude, in light of all of the circumstances, that a factfinder should be allowed to infer that the conversation between DiMauro and Slifka concerned an agreement to squeeze Apex. 78
79 Apex offers evidence of statements by certain persons that it claims suggest evidence of a conspiracy. This evidence adds little to what we already have discussed. The district court found that most of this evidence consists of inadmissible hearsay and that in any event none of the evidence tended to prove the existence of a conspiracy. We need not reach the hearsay question since the proffered evidence does not give rise to an inference of conspiracy. 80 For example, Apex argues that Tony Densieski, a trader for Texas Energy (not a defendant) informed the Vice-President of the Exchange that certain longs had invited Densieski to take advantage of Apex's position. However, Densieski never specified which longs had made this offer. We clearly cannot infer the participation on the part of any defendant based on such a generalized accusation. 81 The testimony of Jay Bernstein, an employee of Northville Caribbean is similarly unhelpful. Bernstein merely testified as to his understanding that there was a conspiracy among other longs. These longs were unspecified, and Bernstein testified that he had no personal knowledge of any actions taken by the longs. 82 Similarly, while Julian Raber allegedly told Patricia Lyons of Apex that he was aware of a conspiracy to 'squeeze the shorts,'  and referred to the actions of the longs as a sting, the testimony concerning these statements lacked any indication of what facts Raber based his opinion on or even whether his opinion was based on anything at all other than rumor or speculation. 83 Upon examination of these and other alleged statements by market participants proffered by Apex in support of its conspiracy theory, we must conclude that taken either as a whole or individually, none of them creates an inference of a conspiracy among any additional named defendants. 84
85 Apex has presented evidence that it believes tends to show that the defendants were motivated by greed and by a strong dislike of Apex. Apex argues that such motivation tends to exclude the possibility of independent action because the long defendants had nothing to gain unless they acted in concert. As discussed above, however, it is not at all clear that one long defendant could not have forced Apex into some concessions. See Part IV.A.2, supra. Moreover, as each defendant became aware of the early nominations by the others, the advantages of inflexibility as to delivery date and location became evident. Since the early nominations became public knowledge, it became evident to anyone in the business that a profit could be made by forcing Apex to deliver. Thus, any motivation to get Apex gives rise to an inference of individual action which is equally as plausible as an inference of conspiracy. We therefore conclude that the long defendants' alleged motivation cannot succeed in establishing a conspiracy on the evidence herein.