Legal Document

506 U.S. 447 113 S.Ct. 884 122 L.Ed.2d 247 SPECTRUM SPORTS, INC., et al., Petitionersv.Shirley McQUILLAN, vir, dba Sorboturf Enterprises. No. 91-10. Argued Nov. 10, 1992. Decided Jan. 25, 1993. Syllabus * Shortly after the manufacturer of sorbothane—a patented elastic polymer with shock-absorbing characteristics—informed respondents, distributors medical, athletic, and equestrian products made sorbothane, that it would no longer sell them polymer, petitioner Spectrum Sports, Inc., became national distributor sorbothane athletic products. Respondents' business failed, they filed suit in District Court against petitioners others, seeking damages for alleged violations of, inter alia, § 2 Sherman Act, which makes an offense any person to "monopolize, or attempt monopolize, combine conspire . monopolize part trade commerce among several States." A jury found defendants violated by, words verdict sheet, "monopolizing, attempting and/or conspiring monopolize." The Appeals affirmed, noting that, although had not specified three possible occurred, stood because evidence established a case attempted monopolization. Relying on its earlier rulings Lessig v. Tidewater Oil Co., 327 F.2d 459, progeny, court held could have inferred two elements offense—a specific intent achieve monopoly power dangerous probability monopolization relevant market—from showing defendants' unfair predatory conduct, without proof market power, was properly instructed make such inferences. Held: Petitioners may be liable under absent monopolize. conduct single firm, governed by 2, is unlawful "only when threatens actual monopolization." Copperweld Corp. Independence Tube Corp., 467 752, 767, 104 2731, 2739, 81 628. Consistent this approach, Courts other than below generally required plaintiff prove (1) defendant has engaged anticompetitive (2) (3) achieving power. Unfair sufficient necessary However, alone insufficient establish success, Swift & Co. United States, 196 375, 402, 25 276, 282, 49 L.Ed. 518 requires inquiry into product geographic defendant's economic market. There little if support statute law Lessig's contrary interpretation 2. Moreover, progeny are inconsistent Act's purpose protecting public from failure directs itself only unfairly tends destroy competition, and, thus, courts been careful avoid constructions might chill competition rather foster it. concern applied so as further ends plainly met inquiring whether "unfair" "predatory" tactics. Since jury's instructions Appeals' affirmance both misconstrued since did negate possibility rested ground alone, remanded proceedings. Pp. ____. 907 154 (CA 9 1990), reversed remanded. WHITE, J., delivered opinion unanimous Court. James D. Vail, Cleveland, OH, petitioner. Robert A. Long, Jr., DC, amicus curiae supporting petitioners. Jeffrey M. Shohet, San Diego, CA, respondents. Justice WHITE 1 Section 26 Stat. 209, amended, 15 U.S.C. persons, returned finding monopolized, conspired entered judgment ruling affirmed issue we before us correctly defined offense. Sorbothane whose characteristics useful variety BTR, Inc. (BTR), owns patent rights wholly owned subsidiaries manufacture States Britain. Hamilton-Kent Manufacturing Company (Hamilton-Kent) Sorbothane, (S.I.) were at all times BTR. S.I. formed 1982 take over Hamilton-Kent's business.1 App. Pet. Cert. A3. Respondents Shirley Larry McQuillan, doing Enterprises, regional 1981 1983. Petitioner (Spectrum), also Kenneth B. Leighton, co-owner Spectrum. Ibid. son Sr., president times. 3 In 1980, respondents McQuillan signed letter Hamilton-Kent, then manufacturing distribution sorbothane. granted McQuillans exclusive purchase use designing horseshoe pad using 4 1981, decided five distributorships selected products, including medical shoe inserts, Southwest. another region. Id., A4-A5. 5 January 1982, shifted responsibility selling distributor. April told wanted relinquish their distributorship condition retaining right develop distribute As May BTR moved A6. May, marketing manager again clear keep rights. At meeting scheduled discuss sale respondents' informed she come agreement him " 'looking work.' refused continued inserts. 6 fall appointed distributor, "no involved products." A7. 1983, began through allegedly indistinguishable one designed August accept orders. thereupon 6. sought obtain BTR's British subsidiary, but subsidiary States. failed. A8. 7 sued §§ 22, Clayton 38 730, 731, 14, Racketeer Influenced Corrupt Organizations 18 1962, provisions California law. fraud, breach oral contract, interference prospective advantage, bad faith denial existence conversion. 8 tried jury, more each 11 return verdict. All 410. civil RICO practices law, Act. awarded $1,743,000 compensatory occurred.3 This amount trebled nearly $1 million attorneys' fees denied motions notwithstanding new trial. Ninth Circuit unpublished opinion. expressly ruled trial Act claims supported liability verdicts well awards these claims. Court, unnecessary rule challenges jury. A28. On present here, Appeals, specifying stand A15. went conclude established.4 rejected petitioners' argument failed order show likely succeed doing, relied 459 (CA9), cert. denied, 377 993, 84 1920, 12 1046 (1964), progeny. A18-A19. noted cases, dealing claims, "if presented, satisfy offense, marketpower [sic]." A19. If, however, there must "relevant find: 10 "There Group thus success therefore, power." A21. decision below, line decisions relies, conflicts holdings Circuits. Every indicated proving market.5 We certiorari 503 ----, 112 1557, 118 206 (1992), resolve conflict Circuits.6 reverse. II While forbids contracts conspiracies restraint commerce, addresses actions firms combinations does define Nor much guidance scant legislative history provision, added late process. See E. Kintner, Legislative History Federal Antitrust Laws Related Statutes 23-25 (1978); P. Areeda Turner, Law ¶ 617, pp. 39-41 (1978). indicate necessarily broad principles left particular cases. See, e.g., 21 Cong.Rec. 2460 (1890) (statement Sen. Sherman). supra, 19; p. 40. 13 first addressed meaning (1905). Court's opinion, written Holmes, contained following passage: 14 "Where acts themselves produce result seeks prevent—for instance, monopoly—but require addition mere forces nature bring pass, pass will happen. Commonwealth Peaslee, 177 Massachusetts 267, 272 [59 N.E. 55, 56 (1901) ]. But consequent exist, statute, like many others common some completed result. 396, S.Ct., 279. explain, every act done constitutes attempt. "It question proximity degree." 281. necessary, sufficient, object 2's prohibition attempts.7 16 reflected view charging monopolization, definition examination Walker Process Equipment, Food Machinery Chemical 382 172, 177, 86 347, 350, (1965), enforcement fraudulently obtained claim violate stated appraise exclusionary illegal terms involved. reason "[w]ithout way measure [the defendant's] ability lessen competition." 17 Similarly, reaffirmed 628 (1984), "Congress authorized scrutiny pose danger Judging unilateral manner reduces risk antitrust laws dampen competitive zeal aggressive entrepreneur." 768, 2740. Thus, "is 2739. Lorain Journal 342 143, 154, 72 181, 187, 96 162 (1951); Griffith, 334 100, 105-106, 68 941, 945, 92 1236 (1948); American Tobacco 328 781, 785, 66 1125, 1127, 90 1575 (1946). followed approach. our demonstrate 820, 312. determine consider market.8 19 Notwithstanding array authority Lessig, prior holdings; indeed, mention either discussed above reaching results. urge affirm below. inclined, embrace 's notion out policy 20 claimed language prohibits attempts "any part" therefore appreciable segment interstate sales product. Yellow Cab 332 218, 226, 67 1560, 1564-1565, 91 2010 (1947). clause, applies charges beyond doubt former Grinnell 384 563, 570-571, 1698, 1704, 778 (1966); E.I. du Pont de Nemours 351 377, 404, 76 994, 1012, 100 1264 (1956).9 determination inference permissible intent, cited, emphasis to, reference "intent probability." F.2d, 474, n. 46, quoting U.S., should removed subsequent passage "not It 22 footnote 395, 23, 1008, proposition charge issue." That footnote, appeared analysis Pont, Government's reliance "the scope issue" Story Parchment Paterson Paper 282 555, 51 248, 75 544 (1931). merely fact Parchment, case, parties challenge adopted lower courts. concerned case. 23 later refining applying protect businesses working market; competitive, even severely so, itself. solicitude private concerns interest. Brunswick Pueblo Bowl-O-Mat, 429 477, 488, 97 690, 697, 50 701 (1977); Cargill, Monfort Colorado, 479 104, 116-117, 107 484, 492-493, 93 427 (1986); Brown Shoe 370 294, 320, 82 1502, 1521, 510 (1962). sometimes difficult distinguish robust long-term effects; moreover, single-firm activity unlike concerted covered 1, "inherently fraught risk." Copperweld, 767-769, 2739-2740. For reasons, firm actually monopolizes dangerously do so. inquir ing Such something compete vigorously, demonstrating III 24 hold allowed infer realistic respect, affirming solely legally erroneous conclusion violation reversed, Sunkist Growers, Winckler Smith Citrus Products 19, 29-30, 1130, 1136, 305 (1962), proceedings consistent opinion.10 So ordered. syllabus prepared Reporter Decisions convenience reader. Detroit Lumber 200 321, 337, 287, 499. formerly called Sorbo, 67. Two alleged, resale price maintenance division territories. Attempted conspiracy charged all, four federal seven state sent special form advised follows: "The pages identify name plaintiffs contend liable. If you find award those defendants. Should decide damages, please assess separately regard already same defendant. insure double recovery. totaled." 416. transcribed "In win monopoly, Plaintiff preponderance evidence: first, Defendants second, restrictive furtherance intent; third, sooner [their] goal fourth, Defendants' occurred affected commerce; fifth, injured property conduct. "If shown Defendant element [sic] 251-252. A16, A20. CVD, Raytheon 769 842, 851 (CA1 1985), 475 1016, 106 1198, 89 312 Twin Laboratories, Weider Health Fitness, 900 566, 570 (CA2 1990); Harold Friedman, Kroger 581 1068, 1079 (CA3 1978); Abcor AM Int'l, 916 924, 926, 931 (CA4 C.A.T. Industrial Disposal, Browning-Ferris Industries, 210 (CA5 1989); Arthur S. Langenderfer, S.E. Johnson 917 1413, 1431-1432 (CA6 502 51, 274, 116 29, 226 (1991); Indiana Grocery, Super Valu Stores, 864 1409, 1413-1416 (CA7 General Industries Hartz Mountain 810 795, 804 (CA8 1987); Colorado Interstate Gas Natural Pipeline America, 885 683, 693 (CA10 1989), 498 972, 111 441, 424 (1990); Key Enterprises Delaware, Venice Hospital, 919 1550, 1565 (CA11 Neumann Reinforced Earth 252 U.S.App.D.C. 11, 15-16, 786 424, 428-429, 851, Abbott Laboratories Brennan, 952 1346, 1354 Fed.1991), 505 2993, 120 870 (1992). Our grant limited presented petition: "Whether manufacturer's absolved violating can, virtue unique rule?" Pet i. Holmes confirmed his Hyde 225 387-388, 32 793, 801, 1114 (1912). dissenting grounds, Justice, citing Swift, where harm very great; "combination, intention overt amounting criminal success." 810. 1431-1432; 570; 693; 1413-1416; 804. cited interpretation, immaterial how large affected, important relation entire type Nation. conceded brief error instruction Brief 45-46.

Classification Label: 7