Court Opinion

ID: 9471042
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:24:14.29616+00
Date Added: 2024-06-11T17:42:15.184140
License: Public Domain

LEWIS R. MORGAN, Senior Circuit Judge,
dissenting.
I respectfully dissent. The district court plainly held that the Capper-Volstead Act, 7 U.S.C. § 291, grants full immunity from section 2 of the Sherman Act, 15 U.S.C. § 2, to a dairy cooperative unless it engages in predatory conduct. Kinnett Dairies, Inc. v. Dairymen, Inc., 512 F.Supp. 608 (M.D.Ga. 1981). Although a precise definition of “predatory” was never articulated in his opinion, the district judge held Kinnett Dairies to a higher standard of proof than a non-agricultural business organization would have faced in a similar antitrust action. The majority now affirms the district court’s use of this standard and avoids any detailed examination of the issue by reasoning that the district court “used the term ‘predatory’ in its broadest sense.” 715 F.2d at 521. I believe the district court erred by requiring Kinnett Dairies to prove any predatory conduct in support of its claims of monopolization and attempt to monopolize under section 2 of the Sherman Act.
The immunization granted to agricultural cooperatives by the Capper-Volstead Act extends only to association and combination activities of agricultural producers. A cooperative is treated as a single entity, not as an association of competitors. In other words, “an agricultural cooperative can wilfully attain a monopoly through the voluntary enrollment of its members, or through a voluntary combination with other cooperatives.” United States v. Dairymen, Inc., 660 F.2d 192, 194 (6th Cir.1981); Alexander v. National Farmers Organization, 687 F.2d 1173 (8th Cir.1982). On the other hand, the competitive activities of the cooperative entity are not immunized. “[Fjarmers may act together in a cooperative association, and the legitimate objects of mutual help may be carried out by the association without contravening the antitrust laws, but ... otherwise, the association acts as an entity with the same responsibility under section 2 of the Sherman Act as if it were a private business corporation.” North Texas Producers Association v. Metzger Dairies, Inc., 348 F.2d 189 (5th Cir.1965), cert, denied, 382 U.S. 977, 86 S.Ct. 545, 15 L.Ed.2d 468 (1966). Thus, the district court erred in concluding that Dairymen, Inc., as an agricultural cooperative, is immunized from section 2 liability absent a showing of predatory conduct.
As an alternative basis for his decision, the district judge considered the various *522claims of Kinnett Dairies as if Capper-Volstead immunity was not applicable. He concluded that Dairymen, Inc., did not monopolize or attempt to monopolize as alleged in the complaint. While this conclusion would normally provide an independent basis for affirmance, I believe the case should be remanded for more detailed findings under this same analysis. The district judge relied heavily on the findings and decision in United States v. Dairymen, Inc., Trade Reg.Rep. ¶ 62,053 (W.D.Ky.1978), and that case has since been reversed by the Sixth Circuit. United States v. Dairymen, Inc., 660 F.2d 192 (6th Cir.1981). Moreover, the district judge summarily concluded that there was no evidence of specific intent which is necessary to establish a claim of attempt to monopolize. I would hold this conclusion to be plain error based on the evidence and factual conclusions cited in the district court’s opinion as it presently reads. The fact that a business practice is not predatory does not eliminate the possibility of an unlawful intent. Alexander v. National Farmers Organization, 687 F.2d at 1183. For these reasons, I would vacate and remand the lower court’s opinion.