Court Opinion

ID: 9465847
Source: CourtListenerOpinion
Date Created: 2023-08-05 00:57:27.7204+00
Date Added: 2024-06-11T17:39:24.240069
License: Public Domain

WIDENER, Circuit Judge,
concurring and dissenting:
I concur in parts I, II, and V of the opinion of the majority. It is with respect to parts III and IV that I have some disagreement.
While I agree that this case should be remanded, I do so only because I do not think the only conclusion which could have been drawn from the record is that Lee-Moore could not reasonably have been expected to show a greater profit had Union not failed to renew its dealership agreement. I doubt very much the plaintiff can present such proof, but the record is not conclusive on this point and all inferences should be drawn in favor of the party against whom summary judgment is entered. I would remand to ascertain first the narrow point of whether or not there were lost profits due to dealing in a different brand, so as to the extent of the remand I respectfully dissent. Only if that hurdle were overcome, should additional evidence on the cause of action be permitted.
In order to show an antitrust injury, as required by Section 4 of the Clayton Act, 15 U.S.C. § 15 (1976), a plaintiff must show injury to his competitive position in the market. “The injury should reflect the anticompetitive effect either of the violation or of anticompetitive acts made possible by the violation.” Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 697, 50 L.Ed.2d 701 (1977).1 The record shows that plaintiff had a more than adequate supply of gasoline since termination of its contract. In fact, in 1973 plaintiff received 2,067,087 gallons more gasoline than in 1972, and 740,237 more gallons of major oil company gasoline.2 The 1974 and 1975 figures show an even more dramatic increase with purchases of 18,535,775 gallons in 1974 and 26,929,920 in 1975. In addition, gross receipts have increased substantially in every year since contract termination; and 1975 net income was more than 250 percent greater than *1308that for 1972.3 Unfortunately, the record does not show the plaintiff’s net income for 1973 and 1974. Without these figures, I cannot be sure the plaintiff was not injured, and even with them, assuming they are in line with those given, I doubt that summary judgment should have been granted, although the figures surely would support a conclusion of no antitrust injury if that were all the evidence of damages at trial.
As to certain other aspects of the majority opinion, I also respectfully disagree. The majority finds injury for the increased price paid to Amoco apart from any relationship between profits and sales. I submit that such a result, without further proof, would amount to the granting of a windfall to the plaintiff. If plaintiff’s profits were up in 1973, the increase may actually have been caused by the termination, i. e., perhaps Amoco was a more popular brand than Union. In any event, to find injury for increased product cost without a determination of profits for the applicable years, and the relation of the profits to the changeover, I think is inconsistent with Brunswick which requires proof of competitive injury before any recovery is permitted.
With respect to changeover costs, the majority argues that plaintiff should be allowed to recover its “substantial administrative expenses in seeking new suppliers and in assisting the retail outlets in switching from Union-brand insignia to Amoco or independent brands.” While it may be true that evidence of such is admissible as proof of an item of damages if antitrust injury is otherwise shown, I think it is not the competitive injury required as a prerequisite to a private action for treble damages. The Sixth Circuit, in a dealer termination setting with damages claimed under § 4 of the Clayton Act, has held that a plaintiff whose supply contract is terminated suffers no injury if an adequate supply of a comparable product is available. Elder-Beerman Stores Corp. v. Federated Department Stores, Inc., 459 F.2d 138 (6th Cir. 1972); cf. United States v. Arnold Schwinn & Co., 388 U.S. 365, 381, 87 S.Ct. 1856, 18 L.Ed.2d 1249 (1966) (vertically imposed territory restrictions do not, in themselves, violate the Sherman Act if comparable alternative supplies are available). As the court stated in Elder-Beerman : “An essential element in attempting to establish the fact of damage because of exclusion from a specified source of supply is a lack of an alternative comparable substitute for the desired merchandise.” 459 F.2d at 148.
As discussed above, the record shows without dispute that Lee-Moore had a more than adequate supply since termination, and, indeed, on occasion Lee-Moore sold excess gas to other jobbers. The majority attempts to avoid this line of authority by asserting that Union gas is a unique product. The main reason given for this conclusion, that different brands of gasoline are not comparable products, is that Lee-Moore’s switch in brands resulted in lost customers. In Mullis v. Arco, 502 F.2d 290 (7th Cir. 1974), the court held that one gasoline is the same as another for purposes of defining the relevant market in a § 2 case even if a dealer would have to pay more to get it from a different supplier following a termination. While the setting of Mullís is somewhat different, the reasoning should yet apply in determining what is the same product. And, a concurring opinion in Elder-Beerman noted that the plaintiff, a store engaged in selling mattresses, would not be injured if it were shown that he could obtain another line of mattresses, even if it were a less desirable brand. 459 F.2d at 160. I suggest that gas is gas for purposes of determining whether an alternate supply is available, and it is clear that the plaintiff had an abundant supply. Even reading the majority opinion as limiting the range of comparable sources to major brand gasoline, the record shows that Lee-Moore has purchased more major oil company gasoline in every year since it was terminated than it did prior to termination.
I also do not believe plaintiff was injured due to lost sales or customers. As stated *1309above, Lee-Moore’s sales and profits have increased since its contract was terminated. Thus, even if some customers were lost, many others were gained. Since one set of customers is as good as another, I feel the plaintiff suffered no injury on that account. As the court said in GAF Corp. v. Circle Floor Co., 463 F.2d 752 (2d Cir. 1972), cert. dismissed, 413 U.S. 901, 93 S.Ct. 3058, 37 L.Ed.2d 1045 (1973): “We fail to see how [plaintiff-seller] could have lost any profits if customers purchased the same quantity in one year as in a previous year, although the identity of the purchasers changed.” The facts in the case at bar are even stronger for the defendant than in GAF. After the supply contract was terminated, Lee-Moore had more overall sales and more sales of a major brand. It therefore did not suffer any injury from lost sales.
Under the majority’s theory, the plaintiff has suffered an> antitrust injury from a lost sale of one brand of a product although the sale of another brand was made, and such an injury from a lost customer although another customer took his place. I do not agree that either correctly states the law. I believe, for antitrust damages, the sale of one brand is as good as another, and the sale to one customer is as good as to another.

. The majority goes to some length to limit Brunswick to its admittedly unusual facts. However, § 4 has been in effect since 1914, and I do not think its requirements are properly so drastically narrowed as the majority indicates. The passage I have quoted from Brunswick I think is the generally accepted construction of § 4 and is the key around which this case should be decided when taken in conjunction with the lost profits theory as set forth in the majority opinion.

. As the table below indicates, in 1973 Lee-Moore (after merger with Johnson) received 740,137 more gallons of major oil company gasoline than Lee-Moore and Johnson combined purchased in 1972. Additionally, its overall supply from all sources increased by 2,067,087 gallons.
Combined Lee-Moore and Johnson Purchases 1972-1973
Year Supplier Purchases
1973 American (LM/J) 10,150,528
Union (LM/J) 639,333
Others (LM/J) 2,807,689
1972 American (LM) 5,871,353
Union (J) 4,198,371
Others 1,480,739

. Lee-Moore’s net income for the fiscal year ending May 31, 1972 was $24,359. Johnson’s for the fiscal year ending April 30, 1972 was $95,408. Lee-Moore’s 1975 net income (now merged with Johnson) for fiscal year ending May 31, 1975 was $317,427. Thus, the 1975 net income was 2.66 times larger than the combined 1972 net income.