Opinion ID: 382054
Heading Depth: 3
Heading Rank: 3

Heading: Standards for Facial Evaluation

Text: 77 Proceeding from the premise, then, that RML has the requisite power in the market, we turn to the standards for the evaluation of its membership criteria. First, the rules must be shown to be justified by the legitimate competitive needs of the association. Our analysis must focus directly on the challenged restraint's impact on competitive conditions, National Society of Professional Engineers, supra, 98 S.Ct. at 1363, for (t)he true test of legality is whether the restraint imposed is such as merely regulates and thereby perhaps promotes competition or whether it is such as may suppress or even destroy competition. Chicago Board of Trade, supra, 38 S.Ct. at 243. As we have shown, while RML creates a number of significant competitive benefits, any exclusion from membership carries the potential for competitive harm; our inquiry here, therefore, is whether the RML criteria which give it power to exclude brokers have legitimate justifications in the competitive needs of the association itself. See e.g., National Society for Professional Engineers, supra; Chicago Board of Trade, supra; Hatley, supra, 552 F.2d at 652-653; McQuade, supra, 467 F.2d at 188; Deesen, supra, 358 F.2d at 170-171; Gamco, supra, 194 F.2d at 487-488; Marin County Board of Realtors, supra, 1976-1 Trade Cases at 68,901. Second, the requirements of the rules themselves must be reasonably necessary to the accomplishment of the legitimate goals and narrowly tailored to that end. 49 Marin County Board of Realtors, supra, 1976-1 Trade Cases at 68,901. See, e.g., Hatley, supra, 552 F.2d at 652-653; McQuade, supra, 467 F.2d at 188; Gamco, supra, 194 F.2d at 487-488. See generally L. Sullivan, Antitrust 255 (1977); 50 R. Bork, The Antitrust Paradox 335-337 (1978). See also id. at 278-279; L. Sullivan, Antitrust § 88 (1977). When the rules fail to measure up to these standards, the justification asserted for them fails. They have, in essence, an anticompetitive effect which has no countervailing procompetitive benefit. 78 If this analysis indicates that the rule gives the association power to produce such harm, the rule may be condemned on its face, without proof of past effect. Combinations are no less unlawful because they have not as yet resulted in restraint. An agreement or combination to follow a course of conduct which will necessarily restrain or monopolize a part of trade or commerce may violate the Sherman Act, whether it be 'wholly nascent or abortive on the one hand, or successful on the other.'  Associated Press, supra, 65 S.Ct. at 1421. Moreover, it is irrelevant that the restrictive practice may not be strictly enforced by its terms; it is the power to bring about the unjustified anticompetitive effect which the Sherman Act condemns. See, e.g., Northern Pacific Railway Co., supra, 78 S.Ct. at 521-522; St. Louis Terminal Railroad Association, supra, 32 S.Ct. at 512, 514. 51 79 a. The Government argues that RML's favorable credit report and business reputation standard should have been held unreasonable on its face and that the district court erred in approving it. It asserts first that, in light of the comprehensive statutory scheme for the licensing and regulation of real estate brokers in Georgia, RML cannot establish itself as an extra-governmental body to impose additional standards for those entering the profession. Second, the Government contends that even if the imposition of some additional standards may be justified, the inherent subjectivity of RML's standards renders them overly broad. 80 We examine first the possible justifications for the favorable credit report and business reputation standards. To begin, there are no finite limitations on the size of a multiple listing service like the size limitations necessary to the operation of some sports leagues, see, e.g., Deesen, supra, 358 F.2d at 170, or inherent in the allocation of space in a market building, see, e.g., Gamco, supra, 194 F.2d at 487; indeed, a multiple listing service succeeds in its goals of creating a public market and reducing market imperfections only insofar as it brings all brokers and listings into its operation. See Austin, Real Estate Boards and Multiple Listing Systems as Restraints of Trade, 70 Colum.L.Rev. 1325, 1357 (1970); note 42 supra. Thus, any claimed rationale for exclusion from a multiple listing service must be closely scrutinized in terms of the operational needs of the service. 81 Similarly, a multiple listing service may not validly assert a generalized concern with the competency and professionalism of real estate brokers as a rationale for exclusion. While the Supreme Court has indicated that in some circumstances an association may adopt ethical norms which regulate and promote ... competition, National Society of Professional Engineers, supra, 98 S.Ct. at 1367, it has voided restraints of this type when they produce anticompetitive effects and are not reasonable ancillary to procompetitive activity. Id.; see id., 98 S.Ct. at 1367 n.22. Here, exclusion from the multiple listing service has pronounced anticompetitive effects; unless those effects are counterbalanced by some direct benefit to competition, the regulation must fail. 52 Again, the adoption of any exclusionary membership criteria must be shown to be justified by the operational needs of the association. 82 An association's enforcement of membership criteria founded upon professional and ethical norms has sometimes been justified as necessary to induce individuals in a given business to join the association, and thus necessary to make the association's procompetitive goals a realistic possibility. See, e. g., McQuade, supra, 467 F.2d at 188. This rationale, however, is only partially applicable to a multiple listing service. The service produces its own incentives to membership by presenting the possibility of significant market efficiencies through its pooling of listings and consequent reduction of market imperfections. Membership gives a broker the potential for more efficient operation and hence larger profits by increasing the number of potential sellers for his listings and by increasing the number of listings he has to sell. Similarly, buyers and sellers are attracted to use the service by its ability to offer broader exposure for the sellers' listings and a wider selection of listings from which the buyer may choose. 53 83 The inducement rationale does afford a justification for some membership criteria based on professional and ethical norms in this case, however, at least in a negative sense. Before they join a listing service, brokers may require some insurance that they will not be endangered legally or ethically by the brokers with whom they enter a listing-sharing agreement. As one court has explained: 84 An MLS (Multiple Listing Service) listing, in effect, offers a subagency to every other MLS participant who can sell the listed property as well as the listing broker.... The subagency relationship is the keystone of MLS. Through this subagency appointment, the listing broker authorizes the other broker to show the property, and attempt to procure a ready, willing and able buyer. If the subagent is successful, the listing broker compensates him by splitting the commission according to whatever formula the two brokers deem appropriate. The subagency appointment necessarily creates significant duties and liabilities, both between the brokers themselves, and between the brokers and the public. A listing broker, by virtue of his agency appointment, owes significant legal and moral duties and responsibilities to the property owner. He bears the legal responsibility to the owner for the acts of other MLS participants who show the home. In addition, the listing broker is responsible for any false or misleading statement made by an MLS participant to a potential buyer. Thus, an essential element of the MLS is broker and public confidence that all MLS participants adhere to high and uniform professional standards. 85 Cedar Rapids Board of Realtors, supra, 1980-1 Trade Cases at 77,042. See Brown v. Indianapolis Board of Realtors, 1977-1 Trade Cases P 61,435, at 71,614 (S.D.Ind.1977). Membership criteria reasonably necessary to ensure this protection, and narrowly tailored to this end, may thus be justified in competitive terms and able to survive at least facial review. 86 RML argues that its requirements that a prospective member have a favorable credit report and business reputation are justified under this theory and meet the requirements of facial reasonableness. The Government implicitly concedes that some insurance of a member's competence and responsibility may be required by its acceptance of RML's requirement that all prospective members must possess active brokers' licenses from the state of Georgia. The Government contends, however, that in light of Georgia's extensive regulation of the business of real estate brokering, RML's other requirements are not necessary to its operations and that these requirements are so inherently subjective that they cannot be considered narrowly tailored to accomplish any legitimate justification that might underlie them. 87 A number of courts considering this problem have held that, where a state extensively regulates the licensing and business conduct of real estate brokers, a multiple listing service may not impose additional standards of responsibility and competence on those who seek to join. See Marin County Board of Realtors, supra, 1976-1 Trade Cases at 68,901; Collins v. Main Line Board of Realtors, 452 Pa. 342, 304 A.2d 493, 497 (1973); Grillo, supra, 219 A.2d at 648. There exists a persuasive argument for this position. When a state extensively regulates a field such as this one, it provides a collective, community judgment as to the standards of professional conduct and responsibility necessary to protect the public from harm. 54 Moreover, it provides the remedial mechanisms necessary to insure that those standards are adhered to in practice. It thus ill-benefits the judiciary, the argument goes, to engage in its own inquiry as to what is necessary to protect individuals in their dealings with state-licensed brokers. 88 Georgia's licensing and regulatory scheme is indeed extensive. It provides that 89 Licenses shall be granted only to persons who bear a good reputation for honesty, trustworthiness, integrity and competence to transact the business of broker or salesman in such manner as to safeguard the interest of the public, and only after satisfactory proof of such qualifications has been presented to the commission. 90 Ga.Code Ann. § 84-1410(a). 55 Moreover, it provides that applicants who have been convicted of certain crimes involving financial misdealings, such as forgery or embezzlement, or of crimes involving moral turpitude, may for that reason alone be denied a license, Ga.Code Ann. § 84-1410(b), 56 and that upon conviction of any of these crimes a broker's license may be suspended or revoked. Ga.Code Ann. § 84-1410(c). Applicants for a broker's license must also be at least 18 years of age, have a high school diploma or its equivalent, and have completed additional study in courses related to real estate. Ga.Code Ann. § 84-1411(a), (b). 57 Moreover, applicants must pass a written examination covering generally the matters confronting real estate brokers. Id. 91 Licensing is not the only form of regulation of broker conduct in Georgia. The Georgia Real Estate Commission has power to regulate the conduct of licensees by passing rules and enforcing the provisions of all state regulations. Ga.Code Ann. § 84-1405(d). 58 Georgia law also requires that brokers maintain a separate checking account, open to inspection by the Georgia Real Estate Commission, for the deposit of all funds received on behalf of a client in a real estate transaction and mandates that a broker shall not be entitled to any part of such fund as his commission or fee until the transaction has been consummated or terminated. Ga.Code Ann. § 84-1419. The Commission may cause the Attorney General of the state to bring an action against any broker who fails to comply with these requirements, to enjoin such failure, or, if necessary, to appoint a receiver. Ga.Code Ann. § 84-1420. Finally, Ga.Code Ann. § 84-1421 provides that the commission may, upon its own motion, and shall upon the sworn complaint in writing of any person, investigate the actions of any real estate broker, associate broker, or sales person. After investigation, the Commission conducts a hearing to determine if the individual has violated any of the state's statutes governing the activities of real estate brokers or any rule of the real estate commission, or has committed any unfair trade practice, defined to include, inter alia, various species of fraud, incompetence, or financial misdealing. Id. 59 If a broker is found guilty, the Commission has power to censure him, revoke or suspend his license, require further education, or require an independent accounting for his separate trust account. Id. 92 In the light of this barrage of state regulation, the Government's argument that RML may reasonably require no more of its prospective members than a valid state license has no little force. Nevertheless, we decline to hold that the presence of an extensive state regulatory scheme automatically bars RML from adopting its own standards of professional competence and responsibility. Giving due weight to the Georgia legislature's judgment as to what is reasonably necessary for the protection of the public in this field, our analysis leads us to the following conclusions: When a multiple listing service seeks to establish the reasonable necessity of membership criteria regulating areas already generally covered by state regulation, it must make a showing either that the legitimate needs of the service require protection in excess of that provided by the state or that the state does not adequately enforce its own regulations. 60 If the state has no regulation comparable to that established by the multiple listing service, then the service must make the showing of its rule's justification and necessity which we have already outlined. Under this approach, due respect is given to the state's attempt to determine which individuals should be allowed to act as brokers, while the multiple listing service is allowed to vindicate those operational necessities which enable it to achieve its procompetitive goals. 61 93 While neither party in this case has addressed the issue of Georgia's enforcement of its rules, and that issue is thus left open on remand, RML has conceded that its favorable credit report and business reputation criteria are covered by Georgia law. Brief for Appellee at 32. It does contend, however, that it has a right to make a current investigation into the professional competence and responsibility of a prospective member and points out that broker's licenses are automatically renewable at two year intervals. See Georgia Real Estate Commission v. Howard, 133 Ga.App. 199, 210 S.E.2d 357, 358 (1974). This argument is, in essence, that the state's regulations do not vindicate RML's need for a current assessment of the competence and responsibility of prospective members. Even though we concede the potential necessity of such a current assessment, RML's argument fails to take account of the fact that under Ga. Code Ann. § 84-1421, as mentioned above, any member of RML can bring a complaint to Georgia Real Estate Commission if RML's investigation shows that the prospective member is guilty of any professional derelictions. If RML is required to use this means of vindicating its needs, not only is the public interest better served, but the danger of wrongful exclusions from the service, and thus injury to competition, is lessened. 62 See Collins, supra, 304 A.2d at 497. In sum, only if RML could show that the state's enforcement of its rules does not vindicate RML's needs could we conclude that it is reasonably necessary for RML to exclude licensed brokers from membership under the rules at issue here. 63 94 Even if RML can make this showing, however, its present rules must be deemed not narrowly tailored to accomplish their legitimate goals. The problem with the requirement of a favorable credit report and business reputation as a condition of membership is that RML does not define these terms or the type of proof required. The inherent subjectivity of these standards is thus in no way limited. Under these standards, RML could conceivably exclude a broker whose business reputation was unfavorable because he was not sufficiently aggressive or because he was thought of as inefficient, even though he had never violated any relevant law or committed a serious breach of any duty. Similarly, a broker with a reputation as a slow pay but who had never actually defaulted on any financial obligation, might be excluded because he did not have a favorable credit report. Moreover, under RML's rules, these determinations might be based upon hearsay allegations or subjective impressions of an applicant's reputation or creditworthiness. In sum, RML's criteria allow it to exclude a licensed broker whom, according to RML's subjective evaluation, it determines to be generally unfit to be a member of the service. 95 In assessing a rule's potential for anticompetitive effects, a court is entitled to consider the purpose of the restraint because knowledge of intent may help the court to interpret facts and predict consequences. Chicago Board of Trade, supra, 38 S.Ct. at 244. See BMI, supra, 99 S.Ct. at 1562. Here, statements of RML's members regarding the intent of the criteria at issue reinforce our conclusion that they call for an inherently subjective evaluation of the applicant. One member testified, for example that an applicant meets RML's criteria if he has got a license and has a clean record and hasn't been in trouble and hadn't been in Bankruptcy or in lawsuits or charged with any immoral acts. Deposition of Charles Lowe at 31-32. In assessing the significance of the applicant's having been in trouble, this member specified that he would consider not only convictions, but also my personal knowledge of the facts. Id. Addressing the favorable business reputation requirement, this member stated: 96 It has been discussed many times and you get a definition from everybody, it is a different definition. I think that is something a man has to define for himself because my definition of anything and yours is (sic) probably different ... , but I think every man has to let his conscious (sic) define it. 97 Id. This broker was a member of RML's Board of Directors at the time the credit and reputation standards were adopted. R.186-187. Testimony by other brokers who were the members of the Board are of similar import. 64 It is thus undisputed that these criteria call for a subjective evaluation of an applicant's fitness for membership. 65 98 Subjective membership criteria are generally not narrowly tailored to accomplish any legitimate goal of an association. See, e. g., Radiant Burners, Inc. v. People's Gas Light & Coke Co., 364 U.S. 656, 81 S.Ct. 365, 5 L.Ed.2d 358 (1961); Blalock, supra, 359 F.Supp. at 1265-1266. 66 As one commentator has observed in an analogous context: 99 Once it is concluded that the program is not an objective one, no further evaluation of benefits to competition which are supposed to flow from the program is appropriate. The potential for harm is so great and the potential for offsetting benefits so small when the program is not objectively run, that the courts will decline to weigh and measure the harms and benefits and will treat the program precisely as they do an explicit boycott. 100 L. Sullivan, Antitrust 249 (1977). Because RML's favorable credit report and business reputation criteria give it the power to exclude brokers from membership on grounds not justified by its competitive needs, the district court erred in upholding them. Assuming, as we must, that RML possesses the requisite market power, we conclude that the district court should have held them facially unreasonable. 67 101 b. The Government also argues that the district court erred in holding facially valid RML's requirement that an applicant must have an office open during customary hours of business. This requirement, the Government points out, gives RML the power to exclude from membership (1) part-time brokers who are engaged in additional lines of endeavor or who otherwise do not choose to maintain full-time real estate offices and (2) brokers who do not choose or cannot afford to hire a full-time staff to keep an office open during customary business hours. 68 The Government contends that there is no legitimate justification for a rule which has these effects and that the rule is overly broad to further any other legitimate objectives of the association. 102 RML's defense takes three lines. First, it argues that its customary hours rule serves to insure that the applicant will be in a likely position to contribute listings to RML and, since the sharing of listings is the essence of RML's operation, the requirement is justified by its operational needs. Second, RML argues that its customary hours rule insures that members will be available to conduct negotiations and to service the listings they do furnish and hence is justified. Finally, RML contends that the customary hours rule has never been applied to exclude brokers of the two classes the Government has identified and that therefore it should not be voided. 69 We consider each of the contentions in turn. 103 It may well be justified for RML to require that a prospective member be actively engaged in the business of being a real estate broker in order that he may contribute to RML's functioning. But a rule requiring that a broker be actively engaged in the business of brokering is a far cry from one requiring that he maintain an office open during customary hours of business. If, for example, a broker holds another job during regular working hours and works in his brokering business on nights and weekends, he may still be very actively engaged as a broker. Indeed, he may find that his hours as a broker mesh well with those of many clients who also hold down jobs during normal working hours and transact their real estate business in their off-hours. In this manner, the off-hours broker may fulfill a genuine market demand. To exclude all brokers who function primarily in this off-hours market on the ground that some may not be actively engaged as brokers is clearly a response in excess of need. In such a case as this one, it is incumbent on RML to regulate those practices of its members which are necessary to its functioning, instead of needlessly excluding an entire class of brokers from membership. See Marin County Board of Realtors, supra, 1976-1 Trade Cases at 68,902. 104 Similarly, the customary hours rule is drawn too broadly to be justified by RML's need to insure that its members be available to service listings and conduct negotiations. As RML asserts, the concept of shared listings, which forms the basis of a multiple listing service, requires that the listing broker be available for negotiations and to close the deal since the listing broker retains the primary responsibility to the seller of the property. 70 This need, however, will not support the total exclusion from membership of all brokers who do not maintain customary office hours. Considering again the example of the broker who conducts his real estate business during his off hours, one cannot conclude that such a broker will not be reasonably available to carry out the duties relevant to his listings. He may for example, be able to conduct many of his servicing and negotiating duties during his off hours 71 and may be able to absent himself from his other job for those duties which cannot be postponed. In fact, it is in the self-interest of a listing broker to make sure that he is available to supply essential services for his listings. One cannot lightly presume that a broker who supplies a listing will forfeit the commission to which he is entitled by failing to service it. Again, to the extent that there exists a danger that brokers will not be reasonably available to service their listings, it is incumbent upon RML to establish rules governing the troublesome practices of its members 72 and not to exclude from membership an entire class of brokers on the basis of an overly broad generalization. 73 105 We thus find RML's customary hours rule to be overly broad to accomplish any legitimate goals of the association. RML's final contention is that, since it has never applied this rule to exclude any part-time brokers (even though it concedes none have applied) and does not intend to so apply it, the rule should not be found unreasonable. We cannot accept this contention. In the first place, the requirement by its own terms allows the results about which the Government complains. 74 Moreover, there is record evidence to indicate that RML members believe part-time brokers should be excluded and that this rule allows such exclusion. 75 Finally, as we have already pointed out, 76 the antitrust laws do not require that we wait until the restraint is accomplished before we hold invalid a rule which gives an association power to produce unjustified anticompetitive effects; the Sherman Act is offended by the power as well as the deed. See, e.g., Associated Press, supra, 65 S.Ct. at 1421; St. Louis Terminal Railroad, supra, 38 S.Ct. at 512. The district court erred in approving the rule. 77 106 c. The Government's next contention is that the district court erred in upholding RML's stock purchase requirement. As noted, RML requires new members to purchase one share of stock at a price to be determined by the Board of Directors. 78 Noting that RML has established no objective criteria for determining a reasonable purchase price, the Government argues that this rule is invalid on the theory that, in cases such as this one, the unrestricted power to set an entrance fee which is unrelated to either the cost of the service provided or the cost of maintaining the service as a going concern is the power to exclude, and hence to destroy competition. 79 We agree. 107 Doubtlessly, RML must be allowed to establish fee schedules which allow it to recoup its costs of operation and to maintain its viability as a going concern. 80 Among those costs which it must be allowed to recover are the start-up costs involved in serving a new member. In addition, it is reasonable to assess a new member a pro rata contribution toward the maintenance and development of RML, including the accumulation of reasonable reserves. To require more than this, however, is to create problems. A sizeable membership fee which bears no relation to the cost factors outlined above may not only create a significant barrier to new entry into the association, but may create a strong inference that the amount has been set up as a barrier against new applications. Grillo, supra, 219 A.2d at 640; see Austin, Real Estate Board and Multiple Listing Systems as Restraints of Trade, 70 Colum.L.Rev. 1325, 1352 (1970). Since the antitrust laws reach the power to create anticompetitive effects, as well as the effects themselves, a rule which allows an association such anticompetitive potential should be held unreasonable. 108 In reaching our conclusion, we rely on the Supreme Court's decision in United States v. St. Louis Terminal Railroad Association, 224 U.S. 383, 32 S.Ct. 507, 56 L.Ed. 810 (1912). There a group of competing railroads formed a terminal association which acquired all available means of access across the Mississippi River at St. Louis. Other railroads were allowed to use these facilities only after they obtained the unanimous consent of all the owners and after payment of a use fee. 81 The Court found this combination of competing railroads to be acting in unreasonable restraint of trade. Id. at 515. 82 Noting, however, that the association served a number of useful, procompetitive purposes through its unification of the terminal systems in St. Louis, id. at 512-514, the Court refused to order dissolution, as the Government requested. Rather, the Court required the association to reform its organizational rules in such a manner as to allow all competing railroads to use its facilities on equal terms. 83 Particularly pertinent here, the Court required the association to provide first 109 for the admission of any existing or future railroad to joint ownership and control of the combined terminal properties, upon such just and reasonable terms as shall place such applying company upon a plane of equality in respect of benefits and burdens with the present proprietary companies. 110 Second. Such plan of reorganization must also provide definitely for the use of the terminal facilities by any other railroad not electing to become a joint owner, upon such just and reasonable terms and regulations as will, in respect of use, character, and cost of service, place every such company upon as nearly an equal plane as may be with respect to expenses and charges as that occupied by the proprietary companies. 111 Id. at 516. 112 These requirements are directly relevant here. In order to avoid running afoul of the antitrust laws, RML may not assume the power to set fees at a level greater than its legitimate needs. While it may continue to allow applicants to become joint owners of the service upon just and reasonable terms, id., and may condition certain rights (such as the right to become a member of the Board of Directors) on such ownership, it must also permit applicants to become members upon the payment of a fee based on its operational needs-one representing, for example, the actual cost of starting up his service and a pro rata contribution toward the costs of the maintenance and development of RML, including the accumulation of reasonable reserves. 84 See, e. g., Marin Board of Realtors, 1976-1 Trade Cases at 68,902; Grillo, supra, 219 A.2d at 640. 85 Moreover, RML must be allowed to recover the actual costs of its continuing services to members, just as it does now. RML's present stock purchase rule, however, is without justification in its competitive needs, and the district court erred in approving it. 86 D. Mootness 113 We have thus concluded that the district court erred in granting RML's motion for summary judgment as to the legality of its present practices. We turn now to the district court's conclusion that the question of the legality of RML's past practices is moot. 114 RML has, in the past, maintained various restrictive practices other than its present membership requirements. Among those practices were (1) a membership voting requirement for admission to the service; 87 (2) a prohibition against belonging to a competing multiple listing service; (3) a prohibition against the advertising of open listings; (4) a prohibition against reapplication to RML for six months after having been rejected; and (5) a complete moratorium on new membership. The Government has contested the legality of all these practices and asserts here that the district court erred in determining that, because RML had abandoned these practices and affirmed that it did not intend to reinstate them, all the issues they presented are moot. We agree. 88 115 It is well-settled that, in a suit for injunctive relief, the voluntary cessation of allegedly illegal practices in an attempt to avoid suit does not moot the controversy they present. See, e. g., Allee v. Medrano, 416 U.S. 802, 94 S.Ct. 2191, 2198, 40 L.Ed.2d 566 (1974); NLRB v. Raytheon Co., 398 U.S. 25, 90 S.Ct. 1547, 1549, 26 L.Ed.2d 21 (1970); United States v. Concentrated Phosphate Export Association, 393 U.S. 199, 89 S.Ct. 361, 364, 21 L.Ed.2d 344 (1968); United States v. W. T. Grant Co., 345 U.S. 629, 73 S.Ct. 894, 897, 97 L.Ed. 1303 (1953); Ciudadanos de San Juan v. Hidalgo County Grand Jury Commissioners, 622 F.2d 807, 824-825 (5th Cir. 1980). The Court's discussion in W. T. Grant, supra, is particularly pertinent here: 116 Both sides agree to the abstract proposition that voluntary cessation of allegedly illegal conduct does not deprive the tribunal of power to hear and determine the case, i. e., does not make the case moot.... A controversy may remain to be settled in such circumstances .... The defendant is free to return to his old ways. This, together with a public interest in having the legality of the practices settled, militates against a mootness conclusion .... For to say that the case has become moot means that the defendant is entitled to a dismissal as a matter of right .... The courts have rightfully refused to grant defendants such a powerful weapon against public law enforcement. 117 The case may nevertheless be moot if the defendant can demonstrate that there is no reasonable expectation that the wrong will be repeated. The burden is a heavy one. Here the defendants told the court that the (alleged violations) no longer existed and disclaimed any intention to revive them. Such a profession does not serve to make the case moot although it is one of the factors to be considered in determining the appropriateness of granting an injunction against the now-discontinued acts. 118 73 S.Ct. at 897 (footnotes and citations omitted). 119 Similarly, in this case, RML's abandonment of the practices described above and its disclaimer of any intention to revive them cannot serve to moot the issues they present. Neither the district court nor RML has cited to any other evidence indicating that it is unlikely that RML will reinstitute these practices, nor has our research discovered any. For these reasons, the district court erred in concluding that the controversy relating to these issues is moot. 120 We leave to the district court on remand the question of the legality of these discontinued practices, in light of our discussion of the applicable rules. See note 18 supra. Even if that court finds these practices illegal and issues the declaratory relief that the Government seeks, however, it may still decline to enter injunctive relief unless the Government can show that there exists some cognizable danger of recurrent violation, something more than the mere possibility which serves to keep the case alive. Id. at 898. Cf. SEC v. Caterinicchia, 613 F.2d 102 (5th Cir. 1980) (refusing injunctive relief to SEC under analogous statutory standard where SEC failed to show likelihood of future violations). While the district court's discretion in this area is broad, it must always be utilized to insure that the public interest is adequately protected from any realistic threat of future injury. See United States v. Glaxo Group, Ltd., 410 U.S. 52, 93 S.Ct. 861, 868, 35 L.Ed.2d 104 (1973); United States v. Parke, Davis and Company, 362 U.S. 29, 80 S.Ct. 503, 514, 4 L.Ed.2d 505 (1960).