Court Opinion

ID: 8938281
Source: CourtListenerOpinion
Date Created: 2022-11-27 07:41:40.920533+00
Date Added: 2024-06-11T17:09:40.195364
License: Public Domain

HOLSCHUH, District Judge,
concurring in the judgment.
Although all members of this panel agree that the judgment of the district court should be affirmed, there is disagreement as to the proper basis for affirmance. *616I agree with Judge Krupansky’s opinion, which affirms the judgment of the district court on the basis that, in this particular case, plaintiff has failed to meet the jurisdictional prerequisite of the Sherman Act, 15 U.S.C. §§ 1 and 2, by showing that defendants’ allegedly unlawful activity has, as a matter of practical economics, a not insubstantial effect on interstate commerce. I write separately to set forth the reasons for my concurrence and to emphasize the unique facts of this case, because “[i]n this area perhaps more than in most, each case must turn on its own facts.” Rasmussen v. American Dairy Association, 472 F.2d 517, 526 (9th Cir.1972), cert. denied, 412 U.S. 950, 93 S.Ct. 3014, 37 L.Ed.2d 1003 (1973).
I.
Initially, on the question of Dr. Stone’s standing to bring this action, I am unable to agree with Judge Martin that the judgment of the district court can be affirmed on this basis.
In order to establish standing in an antitrust action, it is required in this Circuit (1) that the plaintiff allege injury in fact; (2) that the interest which the plaintiff seeks to protect is arguably within the zone of interests protected by the statute in question; and (3) that the alleged injury is an antitrust injury. Riverview Investments, Inc. v. Ottawa Community Improvement Corp., 769 F.2d 324, 328 (6th Cir.1985); Chrysler Corp. v. Fedders Corp., 643 F.2d 1229, 1235 (6th Cir.1981). When assessing standing, a court must “focus on the type of injury pleaded and its relationship to the alleged anticompetitive conduct,” Chrysler Corp. v. Fedders Corp., 643 F.2d at 1235 (emphasis in original), and this Court has expressly cautioned “against making a determination on the merits under the guise of assessing the standing of the claimant.” Chrysler Corp. v. Fedders Corp., 643 F.2d at 1234. See Malamud v. Sinclair Oil Corp., 521 F.2d 1142 (6th Cir.1975). As the Supreme Court said in Flast v. Cohen, 392 U.S. 83, 99, 88 S.Ct. 1942, 1952, 20 L.Ed.2d 947 (1968), “[t]he fundamental aspect of standing is that it focuses on the party seeking to get his complaint before a federal court and not on the issues he wishes to have adjudicated.”
In the present case, Dr. Stone alleges in the complaint that he was excluded from the cardiology practice at William Beaumont Hospital as the result of the concerted action of the defendants. The alleged conduct of the defendants is described as a combination and conspiracy to boycott plaintiff and to give defendants Gordon, Timmis, and Gordon-Timmis and Associates, P.C. (GTA) monopolistic control over the practice of cardiology at the hospital. In my opinion, the alleged conduct of defendants in preventing plaintiff from entering a relevant market as a competitor is clearly the type of antitrust injury that would confer standing on Dr. Stone. As this Court recently found:
In the instant case, plaintiff was a potential competitor in a market allegedly dominated by several of the defendants. Plaintiff’s entrance into this market might benefit consumers by lowering prices and providing a greater diversity in products. Plaintiff has, therefore, alleged facts which, if true, constitute an antitrust injury, and hence has standing to bring this action.
Riverview Investments v. Ottawa Community Improvement Corp., 769 F.2d at 329.
It is not necessary for Dr. Stone to show a present loss of income or other legally cognizable damages in order to have standing as a plaintiff in this action.1 As Judge Martin acknowledges, a plaintiff may obtain injunctive relief simply by demonstrat*617ing a “significant threat of injury from an impending violation of the antitrust laws or from a contemporary violation likely to continue or recur.” Bender v. Southland Corp., 749 F.2d 1205, 1214 (6th Cir.1984) (quoting Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 130, 89 S.Ct. 1562, 1580, 23 L.Ed.2d 129 (1969)). The primary purposes of injunctive relief in such actions are: “(1) putting an end to illegal conduct, (2) depriving violators of the benefits of their illegal conduct, and (3) restoring competition in the marketplace.” Arthur S. Langenderfer, Inc. v. S.E. Johnson Co., 729 F.2d 1050, 1059 (6th Cir.1984) (quoting In re Multidistrict Vehicle Air Pollution, 538 F.2d 231, 234 (9th Cir.1976)). In view of these purposes, I do not believe the quantum of threatened injury need rise to some judicially perceived level in order to confer standing on a plaintiff in an action under the antitrust laws.2 Dr. Stone’s alleged exclusion by the defendants from Beaumont Hospital is sufficient, in my view, to demonstrate an “antitrust injury” and to confer standing on him in this action.
The mere fact that a plaintiff may have standing to bring an antitrust action does not, of course, answer the other basic jurisdictional question of whether the action itself involves conduct having a not insubstantial effect on interstate commerce.
II.
Judge Martin observes: “As Dr. Stone himself admits, he only intends to use Beaumont catheterization facilities two or three times a month. The possible injury from not being allowed such a limited use of the facilities is de minimis ” (Martin, J., Opinion, p. 625). While Dr. Stone’s possible injury may be sufficient for standing purposes, the question remains, to paraphrase Judge Martin, whether “[t]he possible effect on interstate commerce from not being allowed such a limited use of the facilities is de minimis, ” and therefore insufficient for jurisdictional purposes. The answer to that question depends upon whether McClain v. Real Estate Board of New Orleans, Inc., 444 U.S. 232, 100 S.Ct. 502, 62 L;Ed.2d 441 (1980), eliminated the requirement that a defendant’s alleged antitrust activity have a not insubstantial effect on interstate commerce. I believe, as does Judge Krupansky, that it did not.
I do not believe that McLain gave “clear direction” that the interstate commerce requirement is satisfied by merely showing that the defendant’s general business activities have a not insubstantial effect on relevant channels of interstate commerce (Martin, J., Opinion, p. 622). The language relied upon by Judge Martin for this interpretation must be placed in the context of the entire paragraph in which it appeared:
To establish the jurisdictional element of a Sherman Act violation it would be sufficient for petitioners to demonstrate a substantial effect on interstate commerce generated by respondents’ brokerage activity. Petitioners need not make the more particularized showing of an effect on interstate commerce caused by the alleged conspiracy to fix commission rates, or by those other aspects of respondents’ activity that are alleged to be unlawful. The validity of this approach is confirmed by an examination of the case law. If establishing jurisdiction required a showing that the unlawful conduct itself had an effect on interstate commerce, jurisdiction would be defeated *618by a demonstration that the alleged restraint failed to have its intended anti-competitive effect. This is not the rule of our cases. See American Tobacco Co. v. United States, 328 U.S. 781, 811 [66 S.Ct. 1125, 1139, 90 L.Ed. 1575], (1946); United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 225, n. 59 [60 S.Ct. 811, 846 n. 59, 84 L.Ed. 1129] (1940). A violation may still be found in such circumstances because in a civil action under the Sherman Act, liability may be established by proof of either an unlawful purpose or an anticompetitive effect. United States v. United States Gypsum Co., 438 U.S. 422, 436, n. 13 [98 S.Ct. 2864, 2873 n. 13, 57 L.Ed.2d 854] (1978); see United States v. Container Corp., 393 U.S. 333, 337 [89 S.Ct. 510, 512, 21 L.Ed.2d 526] (1969); United States v. National Assn, of Real Estate Boards, 339 U.S. 485, 489 [70 S.Ct. 711, 714, 94 L.Ed. 1007] (1950); United States v. Socony-Vacuum Oil Co., supra, [310 U.S.] at 224-225, n. 59 [60 S.Ct. at 844-846 n. 59].
McLain, 444 U.S. at 242-43, 100 S.Ct. at 509 (emphasis in original).
While it is clear that it is not necessary to show that allegedly unlawful activity has in fact accomplished its goal by showing a resultant effect on interstate commerce, it does not follow that no connection between that activity and interstate commerce need not be shown. To the contrary, the unlawful activity in question must still be shown to be such that, if allowed to continue, as a practical matter it would have a not insubstantial effect on interstate commerce. McLain tends to support this by the language appearing later in the opinion:
To establish federal jurisdiction in this case, there remains only the requirement that respondent’s activities which allegedly have been infected by a price-fixing conspiracy be shown “as a matter of practical economics”' to have a not insubstantial effect on the interstate commerce involved.
McLain, 444 U.S. at 246, 100 S.Ct. at 511 (emphasis added).
I believe that McLain reaffirms the proposition that it is enough if, assuming the allegedly illegal restraint were successful, it would in pragmatic terms have a not insubstantial effect on interstate commerce, Crane v. Intermountain Health Care, Inc., 637 F.2d 715 (10th Cir.1980), and that it is not necessary to make a particularized showing in dollars and cents of the exact effect of the unlawful activity on interstate commerce. I do not believe, however, that McLain established a generalized rule that antitrust jurisdiction can be established simply by showing that some aspects of a defendant’s general business activities have a not insubstantial effect on interstate commerce.3
Judge Martin is of the opinion that the Supreme Court’s recent decision in Jefferson Parish Hospital District No. 2 v. Hyde, 466 U.S. 2, 104 S.Ct. 1551, 80 L.Ed.2d 2 (1984), supports the broad interpretation of McLain he advocates. As he correctly points out, that case was a “hospital staff privilege case,” and the four members of the Court who concurred in the judgment noted: “It is not disputed that such an impact [on interstate commerce] is present here.” Id. 104 S.Ct. at 1569, 1571 n. 5. In my view, however, the Hyde case is distinguishable from the present case and does not support the position that the interstate commerce requirement can be satisfied by simply showing that the defendant’s business activities in general have a not insubstantial effect on interstate commerce.
Hyde involved an exclusive contract between a hospital and a firm of anesthesiologists, whereby all anesthesiological services required by the hospital’s patients *619would be performed by that one firm. As a result of this contract, Dr. Hyde, a board certified anesthesiologist, and all other competitors of the chosen firm were denied admission to the medical staff by the hospital’s board. The Court of Appeals held that the case involved a tying arrangement, because the users of the hospital’s operating room (the tying product) were also compelled to purchase the hospital’s chosen anesthesia service (the tied product). The Court of Appeals recognized that, one element of an illegal tying arrangement is that a not insubstantial amount of interstate commerce is in the tied market, i.e., that “a total amount of business, substantial enough in terms of dollar-volume so as not to be merely de minimis, is foreclosed to competitors by the tie... ” Hyde v. Jefferson Parish Hospital District No. 2, 686 F.2d 286, 292 n. 10 (5th Cir.1982) (quoting Fortner Enterprises v. United States Steel Corp., 394 U.S. 495, 501, 89 S.Ct. 1252, 1257, 22 L.Ed.2d 495 (1969)). The Court of Appeals found the required volume from the fact that 875 operations per month were performed at the hospital with an estimated total value of anesthesia services per year of over a million dollars — a significant portion of which came through the channels of interstate commerce. Thus, the Court of Appeals noted that “the sum of commerce foreclosed in a year’s time amounts to over a million dollars.” Hyde, 686 F.2d at 292 n. 10. The exclusion of all competitors from this substantial market for services would easily satisfy the required effect of the alleged illegal tie on interstate commerce.
In contrast, the present case does not involve a challenged tying arrangement or even an exclusive contract between the hospital and GTA to exclude all competitors. This case involves, instead, an alleged conspiracy between the hospital and GTA to exclude a single doctor who was already a staff member of at least six hospitals in the Detroit area. Furthermore, Dr. Stone was under a contract with Harper Hospital where he is director of that hospital s catheterization lab, a contract that provides that his “primary medical staff ‘loyalty’ will be to Harper Hospital and that all of [his] elective cardiac catheterizations will be done at [Harper] [Hospital exclusively” (Joint Appendix at p. 250). Dr. Stone spends seventy-five percent of his workday at Harper, and his workday is already filled by his responsibilities at Harper and his office practice. Finally, Dr. Stone would use Beaumont Hospital’s facilities, according to his own testimony, for only 2 or 3 catheterizations per month. Even those few patients can be treated by Dr. Stone at the numerous other hospitals where he has privileges.
I fail to see how, under the unique facts of this case, the denial by Beaumont Hospital of staff privileges to Dr. Stone has a not insubstantial effect on interstate commerce — if the words “not insubstantial” are to have any meaning at all. This is not a case involving a closed staff where the defendants have excluded all physicians who are not members of a particular professional group.4 It is, instead, a case of a single physician who desires to add yet another hospital to his extensive list, of hospital affiliations for the avowed purpose of using it on a very infrequent basis. While I do not doubt that a group boycotting scheme can be shown “as a matter of practical economics” to have an effect on a plaintiff’s or a defendant’s interstate activities, the mere allegation of such a scheme is not sufficient to establish federal jurisdiction. When challenged, as it was in this case, the plaintiff must bear the burden of producing evidence that the perpetrators’ allegedly illegal activity, if local in nature, has a not insubstantial effect on interstate commerce. McLain, 444 U.S. at 242, 100 S.Ct. at 509. In my opinion, under the unique facts of this case, plaintiff has failed to bear that burden. Clearly, the exclusion of Dr. Stone from using the catheterization lab at Beaumont Hospital two or three times a month would not have any appreciable effect on the defendants’ activi*620ties in interstate commerce or on plaintiffs receipt of funds from out of state insurers. Contrary to the assumption of Judge Martin “that the majority is only willing to look at the alleged violation’s effect on Dr. Stone’s practice and not at how the purported conspiracy affected defendants’ practice” (Martin, J., Opinion, p. 621), I believe that the activities of all parties are relevant to a determination of this jurisdictional issue. It is simply that in this particular case none of those activities has been shown to be substantially affected, “as a matter of practical economics,” by the alleged conspiracy to exclude Dr. Stone from his professed desire to use Beaumont Hospital on such a limited basis. Neither the interstate aspects of Dr. Stone’s practice nor the interstate aspects of GTA’s practice and the hospital’s business has been shown to be substantially affected by defendants’ alleged conduct. Any effect would be theoretical at best and, in practical economic terms, would clearly be de minimis.
Finally, I do not regard the less expansive interpretation of McLain adopted by Judge Krupansky as being inconsistent with a generally expansive view of Congress’ commerce power. (Martin, J., Opinion, p. 623). I think the Supreme Court has made it clear that even though the reach of the federal antitrust laws is indeed broad, the necessity of showing a not insubstantial effect on interstate commerce is still a critical requirement for entrance to the federal courts:
Although the cases demonstrate the breadth of Sherman Act prohibitions, jurisdiction may not be invoked under that statute unless the relevant aspect of interstate commerce is identified; it is not sufficient merely to rely on identification of a relevant local activity and to presume an interrelationship with some unspecified aspect of interstate commerce. To establish jurisdiction a plaintiff must allege the critical relationship in the pleadings and if these allegations are controverted must proceed to demonstrate by submission of evidence beyond the pleadings either that the defendants’ activity is itself in interstate commerce or, if it is local in nature, that it has an effect on some other appreciable activity demonstrably in interstate commerce. Gulf Oil Corp. v. Copp Paving Co., supra [419 U.S. 186], at 202 [95 S.Ct. 392 at 402, 42 L.Ed.2d 378 (1974)].
McLain, 444 U.S. at 242, 100 S.Ct. at 509.
III.
There is, of course, no ready and easy test for determining whether alleged restraints in individual cases have the requisite effect on interstate commerce. Feminist Women’s Health Center, Inc. v. Mohammad, 586 F.2d 530, 540 (5th Cir. 1978), cert. denied, 444 U.S. 924, 100 S.Ct. 262, 62 L.Ed.2d 180 (1979). In the absence of more definitive guidance from the Supreme Court, it is likely that' courts will continue to be divided, in cases of this nature, on the level of quantitative contact with interstate commerce necessary to satisfy the “not insubstantial effect” requirement.5
Because Judge Krupansky’s opinion is limited to the unusual facts of this particular case, I am convinced a dismissal on the ground that plaintiff failed to establish the required effect on interstate commerce will not result in any major precedent in this area. The significance of this case as precedent is found in the interpretation of McLain adopted by Judge Krupansky, in which I concur and which Judge Martin rejects, and not in the application of McLain to the unique facts presented to us. The majority’s interpretation of McLain will not, in my view, foreclose federal courts from assuming jurisdiction in cases where truly, “as a matter of practical *621economics,” a defendant’s allegedly wrongful activities have a not insubstantial effect on the interstate commerce involved. It will, however, give recognition to the fact that “interstate commerce is not implicated, for Sherman Act purposes, every time someone is excluded from a staff, organization, association, or other membership.” Crane v. Intermountain Health Care, Inc., 637 F.2d 715, 726 (10th Cir.1980). If, as in this case, such an exclusion has at best a de minimis effect on interstate commerce, then the dispute should be resolved by the appropriate state court.

. As the Court said in McLain v. Real Estate Board of New Orleans, Inc., 444 U.S. 232, 243, 100 S.Ct. 502, 509, 62 L.Ed.2d 441 (1980):
Even where there is an inability to prove that concerted activity has resulted in legally cognizable damages, jurisdiction need not be impaired, though such a failure may confine the available remedies to injunctive relief. See Georgia v. Pennsylvania R. Co., 324 U.S. 439, 452-63, 65 S.Ct. 716, 723-28, 89 L.Ed. 1051 (1945); Keogh v. Chicago & N.W. R. Co., 260 U.S. 156, 43 S.Ct. 47, 67 L.Ed. 183 (1922).

. The Supreme Court has noted in United States v. SCRAP, 412 U.S. 669, 689 n. 14, 93 S.Ct. 2405, 2417 n. 14, 37 L.Ed.2d 254 (1973):
We have allowed important interests to be vindicated by plaintiffs with no more at stake in the outcome of an action than a fraction of a vote, see Baker v. Carr, 369 U.S. 186 [82 S.Ct. 691, 7 L.Ed.2d 663 (1962) ]; a $5 fine and costs, see McGowan v. Maryland, 366 U.S. 420 [81 S.Ct. 1101, 6 L.Ed.2d 393 (1961)]; and a $1.50 poll tax. Harper v. Virginia Bd. of Elections, 383 U.S. 663 [86 S.Ct. 1079, 16 L.Ed.2d 169 (1966)]____ As Professor Davis has put it: "The basic idea that comes out in numerous cases is that an identifiable trifle is enough for standing to fight out a question of principle; the trifle is the basis for standing and the principle supplies the motivation." Davis, Standing: Taxpayers and Others, 35 U.Chi.L.Rev. 601, 613. See also K. Davis, Administrative Law Treatise §§ 22.09-5, 22.09-6 (Supp.1970).

. Judge Martin’s proposed reading of McLain "would in essence eliminate the interstate commerce test from antitrust law, since the total activities of virtually any defendant, no matter how local its business, are likely to have some effects upon interstate commerce." Kissan, Webber, Bigus & Holzgraefe, Antitrust and Hospital Privileges: Testing the Conventional Wisdom, 70 Calif.L.Rev. 595, 632 (May, 1982).

. Twelve other cardiologists, none of whom is affiliated with GTA, have privileges at Beaumont and of these twelve, nine have catheterization lab privileges.

. Privilege decisions that affect only individual practitioners or local communities of practitioners raise the most difficult cases for the interstate commerce test, and these cases invite different results under different approaches. The current case law appears to be more or less split on this matter, apparently depending upon the presence or absence of some special quantitative contact with interstate commerce. Kissan, Webber, Bigus & Holzgraefe, Antitrust & Hospital Privileges: Testing the Conventional Wisdom, 70 Calif.L.Rev. 595, 637 (May, 1982).