Court Opinion

ID: 8963186
Source: CourtListenerOpinion
Date Created: 2022-11-27 09:50:48.089106+00
Date Added: 2024-06-11T17:10:14.710303
License: Public Domain

WELLFORD, Circuit Judge,
concurring.
I concur in the result reached and with much of what is said by Judge Boggs. At oral argument, appellant conceded its case was weakest against Bucyrus-Erie (“BE”), which appeared to be sued because its former employee, appellee Moss, was the alleged principal actor in the conspiracy or scheme to do away with appellant as a distributor. The allegations against B-E otherwise are very vague and general with *811respect to its part in the alleged conspiracy. The complaint itself concedes that B-E’s association with appellant and with the products which it distributed ended almost a year before appellant was advised that its distributorship was terminated. There is simply an insufficient allegation that B-E engaged in the alleged antitrust conspiracy and there was no error in granting B-E a judgment on the pleadings. Havoco of America Ltd. v. Shell Oil Co., 626 F.2d 549 (7th Cir.1980).
With respect to GPS Equipment (“GPS”), it is conceded that this defendant corporation did not come into existence until after the termination of Crane. GPS was simply a successor distributor in due course in the territory previously served by appellant, and it was alleged to be an exclusive distributor. In appellant’s brief at pages 16 and 17, it is stated with regard to GPS:
[Njowhere in the complaint is it alleged that GPS was formed by defendant BCP. The only allegations in the complaint are that defendant Moss, an employee of BCP and Charles Sanford, not an employee of BCP, are the two shareholders of defendant GPS Equipment.... the thrust of plaintiffs complaint is that GPS was not a division or wholly owned subsidiary of BCP, but rather a separate entity set up by defendant Moss and Sanford as part and parcel of the conspiracy to restrain trade.
As a separate and unformed entity at the time of appellant’s termination, with no ownership connection with BCP, Northwest, or B-E, there is an insufficient allegation to state a cause of action for antitrust violation against GPS. The case was therefore properly dismissed as to GPS which had no being or existence so that it could then conspire with anyone.
This is a case of an alleged reshuffling of a vertical type by substitution of one form of distribution of one particular brand for another form of distribution. The complaint does not allege, even conclusorily, any decrease in intrabrand competition. This issue is raised for the first time in Crane’s appellate brief. We need not consider or decide this contention, then, and I see no need to discuss it. Furthermore, appellant did not adequately allege any anticompetitive effect of the substitution of another distribution at the interbrand level. Its allegations state an effect only upon itself as a competitor. Therefore, with respect to the remainder of the defendants, the only element of this controversy that could separate it from the typical “jilted distributorship” kind of case is the injection of Moss into the picture. Unless somehow the existence of Moss converts the alleged restraint of trade into a horizontal type thus rendering it perhaps anticompetitive per se, there is nothing but cursory conclusions of anticompetitive conduct here asserted, and the case must fail. See Ace Beer Distributors v. Kohn, Inc., 318 F.2d 283, 287 (6th Cir.), cert. denied, 375 U.S. 922, 84 S.Ct. 267, 11 L.Ed.2d 166 (1963), and Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729 (9th Cir.1987).
Judge Boggs’ analysis of this case under the rule of reason approach seems to me correct and appropriate. See Continental T.V., Inc. v. GTE Sylvania, Inc., 433 U.S. 36, 97 S.Ct. 2549, 53 L.Ed.2d 568 (1977). Moss held positions with both B-E and GPS, and at the pertinent time before termination of appellant, had not yet formed GSP. There is no sufficient factual allegation made by appellant that he or any of the defendants acted for reasons apart from economic justification or for illicit horizontal objectives. There was no allegation about illegal price constraints. Appellant’s reliance upon Tunis v. Ford Motor Co., 823 F.2d 49 (3d Cir.1987), cert. denied, — U.S. -, 108 S.Ct. 1013, 98 L.Ed.2d 979 (1988), based upon Moss’ alleged “independent personal stake” seems insufficient particularly in light of Business Electronics Corp. v. Sharp Electronics Corp., — U.S. -, 108 S.Ct. 1515, 99 L.Ed.2d 808 (1988), and the general rule that a corporation and its own officers cannot legally conspire.
I, accordingly, join in the affirmance of the dismissal of this action.