Court Opinion

ID: 1014924
Source: CourtListenerOpinion
Date Created: 2013-07-04 21:24:54.194116+00
Date Added: 2024-06-11T15:38:07.658156
License: Public Domain

UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT

                            No. 03-2388

SARAH FUTCH HALL, d/b/a Travel Specialist, on
behalf of themselves and all others similarly
situated; JEANINE FLAUGHER, d/b/a Flowers
Travel; ASSOCIATION OF RETAIL TRAVEL AGENTS,

                                          Plaintiffs - Appellants,

          and

PEOPLES TRAVEL LIMITED; JOHN FLAUGHER, d/b/a
Flowers Travel; LANEY INTERNATIONAL TRAVEL;
TRAVEL MANAGEMENT PROFESSIONALS, INCORPORATED,
d/b/a Travel Is Fun,

                                                       Plaintiffs,

          versus

AMERICAN   AIRLINES,    INCORPORATED;   DELTA
AIRLINES, INCORPORATED; NORTHWEST AIRLINES,
INCORPORATED; CONTINENTAL AIRLINES, INC.;
MIDWEST   EXPRESS   AIRLINES,   INCORPORATED;
AIRTRAN HOLDINGS, INCORPORATED; AMERICAN WEST
AIRLINES, INCORPORATED; FRONTIER AIRLINES,
INCORPORATED; ALASKA AIR GROUP, INCORPORATED;
ALASKA AIRLINES, INCORPORATED; HORIZON AIR
INDUSTRIES, INCORPORATED; SOCIETE AIR FRANCE;
KLM ROYAL DUTCH AIRLINES,

                                           Defendants - Appellees,

          and

UNITED AIRLINES, INCORPORATED; DELTA AIRLINES
GLOBAL SERVICES, INCORPORATED; U.S. AIRWAYS,
INCORPORATED; TRANS WORLD AIRLINES; MIDWAY
AIRLINES   CORPORATION;    AIRTRAN   AIRLINES,
INCORPORATED; DEUTSCHE LUFTHANSA AG; ALITALIA,
SPA; AIR CANADA,

                                                        Defendants.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Wilmington. W. Earl Britt, Senior
District Judge. (CA-00-123-BR)

Argued:   October 27, 2004              Decided:   December 9, 2004

Before MOTZ and TRAXLER, Circuit Judges, and HAMILTON, Senior
Circuit Judge.

Affirmed by unpublished per curiam opinion.

ARGUED: Daniel Rees Shulman, GRAY, PLANT, MOOTY, MOOTY & BENNETT,
P.A., Minneapolis, Minnesota, for Appellants.     Lee H. Simowitz,
BAKER & HOSTETLER, L.L.P., Washington, D.C., for Appellees. ON
BRIEF: Dean C. Eyler, GRAY, PLANT, MOOTY, MOOTY & BENNETT, P.A.,
Minneapolis, Minnesota; Henry L. Anderson, Jr., A. L. Butler
Daniel, Bradley A. Coxe, ANDERSON, DANIEL & COXE, Wrightsville
Beach, North Carolina, for Appellants. Gary J. Rickner, WARD AND
SMITH, P.A., New Bern, North Carolina; Ronald F. Wick, Eric Berman,
BAKER & HOSTETLER, L.L.P., Washington, D.C., for Northwest
Airlines, Inc., KLM Royal Dutch Airlines, Continental Airlines,
Inc., Delta Air Lines, Inc., American Airlines, Inc., and Societe
Air France. James V. Dick, Marshall S. Sinick, SQUIRE, SANDERS &
DEMPSEY, L.L.P., Washington, D.C., for Alaska Air Group, Inc.,
Alaska Airlines, Inc., and Horizon Air Industries, Inc. Thomas W.
Rhodes, Edward H. Wasmuth, Jr., SMITH, GAMBRELL & RUSSELL, L.L.P.,
Atlanta, Georgia, for AirTran Holdings, Inc.      Peter Huston, J.
Thomas Rosch, LATHAM & WATKINS, L.L.P., San Francisco, California,
for America West Airlines, Inc.      John D. Shively, Heather T.
Perkins, FAEGRE & BENSON, L.L.P., Denver, Colorado, for Frontier
Airlines, Inc. Robert P. Silverberg, SILVERBERG, GOLDMAN & BIKOFF,
L.L.P., Washington, D.C.; Pressly M. Millen, WOMBLE, CARLYLE,
SANDRIDGE & RICE, P.L.L.C., Raleigh, North Carolina, for Midwest
Express Airlines, Inc.

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Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).

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PER CURIAM:

       This is a nationwide class action lawsuit by travel agents

(the       Travel   Agents)   against   numerous    foreign   and   domestic

airlines.1          The   Travel   Agents   claim   the   defendant-airlines

illegally conspired and executed a scheme to reduce and ultimately

eliminate travel-agent-base-commissions on the sale of domestic and

international airline tickets in a concerted effort to boost

profits of the defendant-airlines and to force them (the Travel

Agents) out of business, all in violation of § 1 of the Sherman

Antitrust Act (the Sherman Act), 15 U.S.C. § 1.            The Travel Agents

allege the conspiracy began in 1995 and ended by late summer 2002.

       Since the initial filing of this action on June 21, 2000, it

has been dismissed, on varying grounds, against Alitalia, Delta Air

Lines Global Services, Inc., Midway, and Lufthansa. The action has

also been stayed against Air Canada, TWA, United, and US Airways,

based upon notices of bankruptcy filed by those airlines.

       1
      The defendant-airlines in this action are:       Air Canada;
Airtran Holdings, Inc. (Airtran); Alaska Air Group, Inc., Alaska
Airlines, Inc., and Horizon Air Industries, Inc. (collectively
Alaska); Alitalia, SPA (Alitalia); America West Airlines, Inc.
(America West); American Airlines (American); Continental Airlines,
Inc. (Continental); Delta Air Lines (Delta); Delta Air Lines Global
Services, Inc.; Deutsche Lufthansa AG (Lufthansa); Frontier
Airlines, Inc. (Frontier); KLM Royal Dutch Airlines (KLM); Midway
Airlines, Corp. (Midway); Midwest Express Airlines, Inc. (Midwest
Express); Northwest Airlines, Inc. (Northwest); Societe Air France
(Air France); Trans World Airlines, Inc. (TWA); United Airlines,
Inc. (United); and US Airways, Inc. (US Airways).

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     The case proceeded against the remaining defendant-airlines

(hereinafter collectively the Airlines):             Airtran, Air France,

Alaska, America West, American, Continental, Delta, Frontier, KLM,

Midwest Express, and Northwest. After full discovery, the Airlines

moved for summary judgment pursuant to Federal Rule of Civil

Procedure 56.   See Fed. R. Civ. P. 56.

     On October 30, 2003, in a lengthy published opinion, the

district court examined the Travel Agents’ proffered evidence

against the Airlines and found no triable issue of fact.               Hall v.

United   Airlines,   Inc.,   296   F.   Supp.   2d   652   (E.D.N.C.    2003).

Accordingly, the district court granted summary judgment in favor

of the Airlines. Notably, the district court directed the clerk of

court to enter final judgment in favor of the Airlines pursuant to

Federal Rule of Civil Procedure 54(b), which allows a district

court to order the entry of final judgment as to less than all

parties and all claims in an action when there is no just reason

for delay.2   See Fed. R. Civ. P. 54(b).        The Travel Agents noted a

timely appeal of this final judgment.

     We review the grant of summary judgment de novo.            Higgins v.

E.I. DuPont de Nemours & Co., 863 F.2d 1162, 1167 (4th Cir. 1988).

Summary judgment is appropriate “if the pleadings, depositions,

     2
      Here, the district court specifically found there was no just
reason to delay the entry of final judgment with respect to the
Airlines to await the conclusion of bankruptcy proceedings against
Air Canada, TWA, United, and US Airways.

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answers to interrogatories, and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as to

any material fact and that the moving party is entitled to a

judgment as a matter of law.”   Fed. R. Civ. P. 56(c).   Moreover, in

assessing the merits of a motion for summary judgment, we view the

evidence in the light most favorable to the non-moving party, here

the Travel Agents, and draw all reasonable inferences in the

non-moving party’s favor.   Anderson v. Liberty Lobby, Inc., 477

U.S. 242, 255 (1986).

     Section 1 of the Sherman Act provides, in pertinent part, that

“[e]very contract, combination in the form of trust or otherwise,

or conspiracy, in restraint of trade or commerce among the several

States, or with foreign nations, is declared to be illegal.”      15

U.S.C. § 1.   Therefore, to establish a conspiracy in restraint of

trade in violation of § 1 of the Sherman Act, as the Travel Agents

have alleged, “a plaintiff must show: (1) a contract, combination

or conspiracy; (2) that imposed an unreasonable restraint of

trade.”   American Chiropractic Assn., Inc. v. Trigon Healthcare,

Inc., 367 F.3d 212, 223 (4th Cir. 2004) (internal quotation marks

omitted). Significantly, purely unilateral action does not violate

§ 1 of the Sherman Act.     Copperweld Corp. v. Independence Tube

Corp., 467 U.S. 752, 767-68 (1984).     Rather, concerted activity

between at least two legally distinct persons or entities is at the

heart of a § 1 Sherman Act violation. American Chiropractic Assn.,

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Inc.,   367   F.3d   at   223.     To   elaborate,    “concerted   activity

susceptible to sanction by section 1 is activity in which multiple

parties join their resources, rights, or economic power together in

order to achieve an outcome that, but for the concert, would

naturally be frustrated by their competing interests (by way of

profit-maximizing     choices).”        Virginia    Vermiculite,   Ltd.   v.

Historic Green Springs, Inc., 307 F.3d 277, 282 (4th Cir. 2002).

     We have carefully reviewed and considered the district court’s

opinion, the voluminous appellate record, and the parties’ oral and

written appellate arguments. We agree with the district court that

the Travel Agents have not proffered sufficient evidence, when

viewed in the light most favorable to them and when drawing all

reasonable inferences in their favor, to support a finding of

concerted activity by the Airlines, which finding is necessary to

establish a § 1 Sherman Act violation.             Accordingly, we find no

error in the district court’s decision to grant summary judgment in

favor of the Airlines, and we affirm entry of final judgment in

favor of the Airlines on the reasoning of the district court.             See

Hall, 296 F. Supp. 2d at 661-78, 680-81.

                                                                   AFFIRMED

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