Court Opinion

ID: 9670891
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:27:51.513593+00
Date Added: 2024-06-11T18:16:07.080015
License: Public Domain

HENDERSON, Justice
(dissenting).
We here address ourselves to the misbehavior of a municipal body. State law prohibits the type of conspiratorial, nepotistic, wrongful, evil, manipulative, and tortious conduct in which the corporate body of the City of Chamberlain became deeply involved. SDCL 37-1-3.1 provides: “A contract, combination, or conspiracy between two or more persons in restraint of trade or commerce any part of which is within this state is unlawful. ‘Person’ means any natural person, partnership, corporation, association, or other legal entity.” SDCL 37-1-3.2 further provides: “The monopolization by any person, or an attempt to monopolize, or combine, or conspire with any other person or persons, to monopolize any of the trade or commerce within this state shall be unlawful.” Under SDCL 37-1-14.3, a damage remedy is provided either in equitable relief or damages. This section further provides for treble damages. SDCL 37-1-14.3 provides, inter alia, as follows:
A person injured in his business or property by a violation of this chapter may bring an action for appropriate injunctive or other equitable relief, damages sustained and, as determined by the court, taxable costs and reasonable attorney’s fees. The trier of fact shall increase recovery under this section to three times the damages sustained. (Emphasis supplied mine.)
The City of Chamberlain was tried, in its own county seat, and was assessed $121,500 damages for violations of the above three statutes. Beyond any shadow of a doubt, the City of Chamberlain was determined by the jury to be a conspirator in unlawful activity. Coconspirators, although not named as defendants, were officials and officers of the City of Chamberlain, and those who stood to make a profit springing from the conspiracy. In the City of Chamberlain — its very own — found it wanting at the bar of justice and ultimately determined that it had exploited its municipal power inflicting a civil wrong. Lay people’s judgment, so vital to a healthy legal system, is being thwarted and substituted by a legalistic judgment far removed from the facts of this case and spirit of the Trial Courtroom.
*81I am shocked by the skeleton set of facts set forth in the majority opinion; moreover, the facts set forth by the author of the majority opinion seem to be in 100% conflict with the facts that the jury found. It is axiomatic that the jury resolves all fact questions. Bogh v. Beadles, 79 S.D. 23, 107 N.W.2d 342 (1961). A jury is entitled to accept one witness’ version of the facts and reject another’s. Lukens v. Zavadil, 281 N.W.2d 78 (S.D.1979). Here, the jury accepted the version of Byre’s witnesses that there was a conspiracy and rejected the City of Chamberlain’s witnesses that there was not a conspiracy. “It is the jury’s function, rather than ours, to resolve conflicting evidence. Urban v. Wait’s Supermarket, Inc., 294 N.W.2d 793 (S.D.1980).” Farmers State Bank of Winner v. Westrum, 341 N.W.2d 631, 635 (S.D.1983). “As a reviewing Court, we view the evidence and all reasonable inferences therefrom in a light most favorable to support the verdict. Alberts v. Mut. Serv. Cas. Ins. Co., 80 S.D. 303, 123 N.W.2d 96 (1963).” Id., 341 N.W.2d at 634-35. Without expressly so stating, it appears to me the author of the majority opinion is asserting that the evidence presented at trial does not support the jury verdict. An award of damages rests within the province of the jury and should not be freely disturbed.
A fair portrayal of the facts is indispensable to a just result. The City of Chamberlain partook of efforts to create and perpetuate a private garbage service, namely, S & S service. This is not a legitimate municipal function. S & S service is a partnership owned by Lyle Stienfeld and Bruce Steckelberg. The City of Chamberlain employs Stienfeld. As I will develop, the City of Chamberlain took this municipal employee and structured him into the private garbage service business. One Delora Steckel-berg is Chamberlain’s finance officer; her son is Bruce Steckelberg. Bruce Steckel-berg is also the son-in-law of Lyle Stien-feld. Chamberlain’s Commissioner of Garbage was Gary Busack. Busack’s principal livelihood was a personal loan officer for the Tri-County State Bank of Chamberlain. Garbage Commissioner Busack, in his own words, described Chamberlain’s employee, Stienfeld, this way: “I am his banker, a friend, I would say.” Byre had private contracts to service customers as a private hauler of garbage under Chamberlain City Ordinance 375. Chamberlain, by skullduggery, effectively disregarded Byre’s private contracts and placed him in the position of bidding on his own customers via a bid notice of November 23 and 30, 1978. In November 1978, bid notices called for a three-year contract. Byre submitted a bid for only that portion of the customer market for which he was not privately contracted exactly as specified in the bid notices; Byre’s bid was for the three-year term. Stienfeld and Steckelberg submitted a bid for a five-year contract. Upon motion and advice of Garbage Commissioner Busack, the City rejected both bids. Just five days after the rejection of both bids, Commissioner Busack motivated the City to initiate another bid. Thereupon, Chamberlain altered bid specifications to conform with the first bid submitted by S & S. Thereby, the three-year contract provision was changed to a five-year contract provision to aid and assist S & S get the bid. On January 17, 1979, Chamberlain accepted this rigged bid and once again it was Garbage Commissioner Busack who motioned for acceptance of S & S’s bid. While this bidding process was under way, behind-the-scenes manipulation and maneuvering transpired. S & S owned no garbage hauling equipment, but Garbage Commissioner Busack took care of this. Busack made a bank loan to S & S for the purchase of a new garbage truck (acting as a friend and banker). During the trial, it was revealed by admissions of Busack that he had met with City employee Stienfeld in late November and early December 1978 concerning a bank loan for the purchase of a garbage truck. Conveniently, the payback on the promissory note was for five years (coinciding with the five-year garbage contract). During trial, through cross-examination, it was brought out that had the contract and the loan been for a three-year period, S & S would have gone *82into the red each month. Chamberlain’s Commissioner of Garbage, Busack, closed the five-year loan for the Tri-County State Bank and signed for the bank. Neither Steckelberg nor Stienfeld had ever been in the garbage business before. Steckelberg admitted that he had no assets for collateral on the garbage truck and admitted receiving a 100% bank loan. Evidence discloses that after Chamberlain’s ad in the newspaper, commented on below, Byre received very few contracts as a private hauler of garbage and that he had numerous letters and telephone calls canceling his services. In an effort to stomp on Byre and his son, who worked with him, the City of Chamberlain literally attempted to exterminate him from the business. The City of Chamberlain tried to beat Byre’s truck to the garbage cans by using an open truck. For a period of two months, this open truck was used by the City of Chamberlain on the City streets of Chamberlain. The fact that some people were contracted with Byre seemed to be immaterial to the City of Chamberlain. Having bridged a time gap, the City of Chamberlain permitted S & S to use the City’s truck to fulfill S & S’s contract because S & S did not have a garbage truck on February 1, 1979, the effective date of S & S’s new contract. Delora Steckelberg, as earlier alluded to, was the finance officer for the City of Chamberlain. The City of Chamberlain paid for one-half of S & S’s compensation plates, which was a highly unusual practice. There is even evidence that the City of Chamberlain did double billing (notwithstanding Byre’s contracts), and then collected for services performed by Byre. Apparently, the City never accounted for one penny paid to the City for Byre’s services. To further destroy Byre and force him out of business, the City of Chamberlain, acting through its officials, changed the lock to the gate of the dump ground denying Byre access. To further compound Byre’s woe, it appears that the same Mr. Busack reported a complaint to South Dakota officials concerning Byre’s alternative dump site. Byre had contacted a.farmer across the river about an old gravel site that needed to be filled. Every effort, it seems, was made by Busack to make sure Byre was totally squeezed out of the garbage service business. Byre submitted testimony from an expert, a Professor of Economics at South Dakota State University. This professor wrote a doctorial thesis on market structure. Testimony was adduced that provided an entire framework for economic analysis of the damages to Byre and the causative actions of the City of Chamberlain. Another expert was called on behalf of Byre, namely, a college graduate with twelve years’ experience as an economic planner in the government and private sector. An analysis of income and operating expenses for Byre’s garbage operation was developed in great detail and from numerous resources, to wit: City Finance Office, Byre’s records, income tax records, time and motion studies of Byre’s operation, certified audit from the Auditor General of the State of South Dakota, fuel costs from a local station, data from the Brule County Courthouse, and information from the South Dakota Department of Transportation. This data was then contrasted to that of another private garbage collection business at Mitchell, South Dakota. Ultimately, Byre presented this testimony plus exhibits # 67 and # 68 (received without objection) establishing a loss of $83,782. Plaintiff’s exhibit # 67 was an item-by-item comparison of income and expenses for the years 1979-1982, comparing the entire market against 50% of the market. Plaintiff’s exhibit # 68 was a summary of income and expenses based on the total market for the years 1979-1982.
I agree with the Court’s decision concerning the existence of Chamberlain’s state action exemption from antitrust liability and the propriety of the initiated ordinance and jury instructions. However, I cannot agree that the City did not exceed its state action exemption or that the admission of certain damage evidence constituted reversible error. Thus, my conclusion is radically different than the majority opinion. Therefore, I vote to sustain the verdict below of $121,500. This is another *83example of where government used its power to usurp the open market in the free enterprise system. It is another example of government crunching down on a little operator to grind him into oblivion. Byre operated this garbage business since 1960 when he first bought equipment from the City of Chamberlain in that year. He operates this business with his four sons working beside him and the mother acting as the bookkeeper. Not only these facts came before the jury, but the fact that Byre did an excellent job with his garbage service notwithstanding that he suffered from diabetes and was almost blind. Before the jury, he testified: “Well, it kind of looks bad. It looks like Chamberlain is trying to run me out.” Therefore, it comes as no surprise to this writer that the City of Chamberlain suffered a judgment of this magnitude to be entered against it. If law is about anything, it is about being fair and the City of Chamberlain did not play fair.
A city’s anticompetitive activities, “even [though] a lawful monopol[y,] may be subject to antitrust restraints when it seeks to extend or exploit its monopoly in a manner not contemplated by its authorization.” Lafayette v. Louisiana Power & Light Co., 435 U.S. 389, 417, 98 S.Ct. 1123, 1138-39, 55 L.Ed.2d 364, 385 (1978) (bracketed material inserted). When the City of Chamberlain’s actions are examined in toto, a shameful course of conduct aimed at running Byre out of business is exposed. First, Chamberlain advertised for bids on a three-year contract and published an ad informing residents that their garbage would be collected by City “regardless if you go with Byre & Sons ” and that they would be billed for this service. The ad also commanded citizens to “Go along with us.” The City Garbage Commissioner, in his role as a loan officer for a local bank, then began negotiating a five-year loan for a garbage truck with the partners of S & S, as related above. Obviously, the Garbage Commissioner took on a questionable and tainted dual role. Both of the bids submitted were subsequently rejected and City re-let the bids for a five-year contract. This new bid requirement corresponded with S & S’s rejected bid and their five-year equipment loan. City next changed its garbage ordinance to require a dumping fee for private garbage collectors and awarded the contract to S & S. On the start-up date of the new contract, City changed the lock to the dump gates and loaned S & S equipment so that S & S could begin fulfilling the contract. Finally, after the separate garbage services were operating, City complained to state officials about Byre’s new dump facility; and the City Auditor, who is also a mother of a partner in S & S, informed some city employees that city policy required them to use the S & S garbage service. It was municipal muscle, maneuvering and manipulation to such extent that it was exploitation of their power — the very kind which the United States Supreme Court has condemned.
It cannot reasonably be contended that such maneuvering by city employees to implement a new garbage contractor and make that business a success was within the contemplation of the legislature when it enacted statutes, which in effect granted municipalities state action immunity when establishing or granting garbage removal monopolies. Whether “City could have lawfully monopolized the Chamberlain waste removal market up until March 6, 1979,” is irrelevant because the action taken before that time was not within the contemplation of the authorizing legislation and thus constituted an unlawful restraint of trade not immune from antitrust liability. The fact that the acts complained of may be lawful in and of themselves is also irrelevant. “[Pjlaintiffs need not establish that each act was illegal. It is only necessary that the acts whether legal or illegal be in furtherance of a common plan or conspiracy in restraint of trade.” Juneau Square v. First Wis. Nat’l Bank of Milwaukee, 435 F.Supp. 1307, 1317 (E.D.Wis. 1977) (citations omitted). “It is well settled that acts which are in themselves legal lose that character when they become constituent elements of an unlawful scheme.” Jerrold Electronics Corp. v. Wescoast Broadcasting Co., 341 F.2d 653, 663 (9th Cir. 1965) (citations omitted). The jury deter*84mined that a plan or scheme to run Byre out of business existed and this Court should not disturb that determination. The facts which are set forth above cry out that there existed a conspiracy in restraint of trade.
Neither can I agree with the majority’s ruling in regard to the evidentiary questions presented. Testimony concerning the double billing of residents was elicited as evidence of yet another link in the conspiratorial chain and as evidence of damages resulting therefrom. The fact that the double billing was legal because mandated by ordinance does not make evidence of its occurrence and the injury caused thereby, immaterial. As stated above, each act in a restraint of trade conspiracy need not be illegal if done in furtherance of the scheme. Thus, the double billing testimony was highly admissible because it was both relevant and probative to the question of the existence of an illegal conspiracy and the resulting damages.
The majority also holds that Byre’s expert’s testimony about damages including the loss of the other one-half of the market not under contract was groundless and without foundation and thus inadmissible.* This author has, in great detail, exposed the foundational facts for this testimony. Moreover, the majority fails to recognize the extreme difficulty of proving the precise amount of damages in any antitrust action. This is a great academic failing of the majority writing for it ignores the substantial weight of authority in the United States. Difficulty in proving up damages in antitrust actions is illustrated by some of the following authorities. “The latitude granted the victim of antitrust violations in establishing his monetary damages has long been recognized.” SCM Corp. v. Xerox Corp., 507 F.2d 358, 363 (2nd Cir.1974) (citations omitted). “[T]he amount of damages need not depend on precise proof....” Hobart Bros. Co. v. Malcolm T. Gilliland, Inc., 471 F.2d 894, 902 (5th Cir.1973) (citations omitted), cert. denied, 412 U.S. 923, 93 S.Ct. 2736, 37 L.Ed.2d 150 (1973). The United States Supreme Court has also recognized the practical difficulty of proving damages. In Eastman Kodak Co. v. S. Photo Materials Co., 273 U.S. 359, 379, 47 S.Ct. 400, 405, 71 L.Ed. 684, 691 (1927), the Court said: “It is sufficient if a reasonable basis of computation is afforded, although the result be only approximate.” In the case at hand, Byre sought to prove his damages by presenting an income and expense analysis of his garbage operation and private landfill. This necessarily involved a comparison of the income and expense of the portion of the market Byre had under contract and the income and expense of the total Chamberlain garbage market. Such an analysis does not grant Byre a monopoly of the garbage market but instead establishes the maximum amount of possible damages. The limitation on damages, when combined with other damage testimony, i.e., lost contracts, afforded the jury a reasonable basis for computing damages and avoided an award based on mere speculation, pure guesswork or conjecture. The foundation of this analysis was the facts and data involved in this case, and facts gathered by the expert which other experts would reasonably rely upon. SDCL 19-15-3. The computation of damages (received in evidence as exhibit # 67 reflecting an $83,782 loss), as testified to by Byre’s expert, was properly admitted by the trial judge, for there was a proper foundation laid and no objection to its receipt in evidence. Therefore, not having objected to this damage evidence below, it cannot now be raised at the appellate level for the first time. Chamberlain did not preserve its appellate record thereon. Weaver v. Boortz, 301 N.W.2d 673 (S.D.1981). See also, Jones v. Sully Buttes Schools, 340 N.W.2d 697 (S.D.1983); Mortweet v. Eliason, 335 N.W.2d 812 (S.D.1983); Weber v. South Dakota Dep’t of Labor, 323 N.W.2d 117 (S.D.1982); Ward v. Viborg School Dist. No. 60-5, 319 N.W.2d 502 (S.D.1982); First Federal Sav. *85& Loan v. Lovett, 318 N.W.2d 133 (S.D.1982). We are not trying lawsuits at the appellate level. Reference is made to the last six sentences of the majority opinion. The majority opinion indicates, in essence, that Byre’s damages of $83,782 as reflected by plaintiffs exhibit # 67, was “groundless,” “without foundation,” and “obviously prejudicial.” Counsel for the City of Chamberlain should have objected to this line of evidence and especially to these very important exhibits which were bound to have a great impact on the jury. If, indeed, it was improper for this evidence to go before the jury and to be received by this jury and to be considered by this jury in arriving at its verdict, it was for Chamberlain’s counsel to object and to give the trial court an opportunity to rule immediately thereupon. The trial court is entitled to rule on an objection before we, at this level, say that it has committed an error. In conclusion, it is wrong for this Court to now fault the trial court on this matter of damages when the City of Chamberlain permitted these critical exhibits to be admitted without objection.
For these reasons, I vote to affirm the verdict and judgment below.
I am authorized to state that Retired Justice Dunn joins in this dissent.

The City’s expert was Dr. Ralph Brown; this expert crumbled under cross-examination before the jury for he testified not as an expert in the garbage business but rather as a consumer of garbage. Chamberlain produced no expert or City employee providing cost figures for running its own municipal garbage service.