Court Opinion

ID: 8825299
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:45:32.72457+00
Date Added: 2024-06-11T17:04:45.540579
License: Public Domain

SANBORN, Circuit Judge
(dissenting). The question in this case is: Do the facts alleged in the complaint show that the business conducted by the plaintiff, the contracts made and transactions had by him with the defendants, or any of them, which he alleges they conspired to suppress, and did suppress, constitute interstate commerce ? The complaint contains averments of these facts:
Certain defendant corporations of the state of New York, named in the complaint, which either manufactured, owned, or distributed, from their places of business in New York City, moving picture films, which they' had there completed or approved, and who, for convenience, will be termed “producers,” after perfection and approval of these films, *308wot accustomed publicly to announce from time to time by advertisements that these films would be released, which meant that they would be sent out from New York by express or parcel post to branches or agents which they had in various cities, one of which was in Omaha, Neb., to be delivered by the agents to those who hired and paid for the use thereof by displaying them in the theaters in the vicinities of these respective branches or agents. The plaintiff was the owner of one theater, the operator of two or three others, and for the operators of several other theaters he selected, secured, and distributed to them the use of picture films which producers leased for this purpose. The defendant producers leased the use of their films for exhibition by the plaintiff, and by the operators in Nebraska and vicinity for whom he selected' such films, from their New York offices through their branch offices or agents in Omaha. The producers accomplished this by entering into written and oral contracts with the plaintiff substantially on the terms and conditions set forth in Exhibits A, B, and C, attached to the complaint. By the terms of these gontracts the producers retained the title, the control, and the right to recall these films at their home office's in New York.
The nature of these contracts and the character of the commerce transacted under them appears from Exhibit A, which was a contract between the defendant, the Goldwyn Corporation of New York, a producer, styled in the agreement the “exchange,” and the plaintiff, Bind-erup, lessee of the moving picture films described therein, who was called in the contract “exhibitor.” By this agreement the “exchange” agreed to furnish the “exhibitor,” at the former’s branch office in Omaha, one print of each of 26 photoplays, beginning with the motion picture released September 9, 1917, to let to the exhibitor the right and license publicly to exhibit and display each of said prints in the Opera House Theater, in the city of Franklin, Neb., and at no other place, and that the exhibitor should have the right to the first run of each of said prints in Franklin, Neb. The exhibitor agreed to accept and publicly exhibit for two consecutive days the first of the prints on September 27, 1918, and each successive print every second Friday thereafter for a like number of days; that he would pay the exchange for the use of and the right to exhibit each of said prints for the number of days specified $10; that he would deliver back to the exchange and pay the cost thereof at its branch office, if in the same city in which the exhibitor’s theater was located, or if the exchange maintains no office in. said city (and it probably did not in Franklin) to tire office of the express company or other carrier designated by the exchange, or if an express carrier or other carrier is not so designated, to the nearest proper express company, or to the most rapid carrier service, immediately after the close of the performance upon the last day of exhibition of the respective prints, each of the prints in the metal can and shipping case furnished therewith, correctly and legibly addressed for reshipment in accordance with direction and advices previously given or to be given by the exchange, and that he would pay all expenses or other carriage charges incurred in shipping the films to the exhibitor.
This contract contained also agreements that it should' not be binding *309upon the exchange, unless countersigned and approved on its behalf by one of its officers in the city of New York, and that it and every term and condition thereof should be deemed an agreement made, executed, and delivered in the state of New York, and that they should be construed according to the laws and statutes of that state. The sample contracts, Exhibits B and C, attached to the petition, differed from Exhibit A in the names of the producers, the moving picture films described, and other such details; but they contained substantially the same provisions that have been recited from Exhibit A. There are other averments in the complaint which point in the same direction as those which have been recited.
The averments recited, however, have convinced me that these contracts, the shipments of the films from New York to Nebraska for the plaintiff pursuant thereto, the delivery thereof to the plaintiff by the agents or branches of the producers in Omaha for his use in accordance with the terms of the contract, all constituted parts of interstate -commerce between the plaintiff and the New York producers, which, according to the averments of the plaintiff, their alleged unlawful acts first unreasonably restrained and then suppressed. If the producers had agreed with the plaintiff to sell these films to him and to ship them to their branches or agents in Omaha, and there to deliver them to him upon his call and if they had performed that contract, there could be no doubt that the transactions between the producers and the plaintiff constituted interstate commerce. It seems to me that contracts to lease the use of films, to ship the films from New York to Nebraska and deliver them upon the call of the lessee at the branches or offices of the agents of the producers in the same way, and the performance of such contracts, must also constitute such commerce.
The averments of this complaint are in effect that the entire business and all the transactions between the defendant producers and the plaintiff were founded upon these contracts between the producers, corporations of the state of New York, whose officers in New York executed and approved them, and the plaintiff, a citizen and resident of the state of Nebraska. These contracts provided that they should he construed by the laws and statutes of New York, that the producers would lease to the plaintiff, a Nebraska operator, for temporary display, and would ship'from New York to him, to be delivered to him at Omaha by their branches or agents on his call, these moving picture films, which he agreed to display in theaters in the vicinity of Omaha, and immediately thereafter to return them to the producers. In my opinion, these agreements were contracts to engage in interstate commerce. Their performance was interstate commerce. The alleged conspiracy of the defendants to suppress that commerce, and its suppression, constituted a violation of the Anti-Trust Act of Congress. The court below therefore had jurisdiction of the issues presented by the averments of the complaint and the denials of the answers in this case. United States v. Motion Picture Patents Co. (D. C.) 225 Fed. 800; United States v. United States Shoe Machinery Co. (D. C.) 234 Fed. 127, 143, 144 : Butler Bros. Shoe Co. v. United States Rubber Co., 156 Fed. 1, 17, 84 C. C. A. 167; Swift & Co. v. United States, 196 U. S. *310375, 396, 397, 25 Sup. Ct. 276, 49 L. Ed. 518; Loewe v. Lawler, 208 U. S. 274, 300, 302, 28 Sup. Ct. 301, 52 L. Ed. 488, 13 Ann. Cas. 815; Dahnke-Walker Milling Co. v. Bondurant (December 12, 1921) 257 U. S. —, 42 Sup. Ct. 106, 66 L. Ed. -; Lemke, Attorney General, v. Farmers’ Grain Co. (February 27, 1922) 257 U. S. -, 42 Sup. Ct. 244, 66 L. Ed. —.
And it seems to me that the judgment of the court below ought to be reversed, and this case ought to be remanded to that court for a • new trial.