Court Opinion

ID: 9308762
Source: CourtListenerOpinion
Date Created: 2022-12-02 17:22:27.743909+00
Date Added: 2024-06-11T17:14:03.440786
License: Public Domain

THORNBERRY, Judge,
dissenting:
Plaintiffs appeal final judgments dismissing their antitrust claims. In re Coordinated Pretrial Proceedings, M.D.L. No. 150 (C.D.Cal. March 17, 1986) (Rule 54(b) final judgment dismissing antitrust counts in both CV 75-2232 and CV 76-2839); Long Beach v. Standard Oil Company, CV 82-3252 (C.D.Cal. April 1, 1986) (final judgment dismissing case). As explained in its September 19,1985, memorandum decision, the district court rendered judgment based on two alternative holdings. See In re Coordinated Pretrial Proceedings, M.D.L. No. 150 slip op. at 8-9 (C.D.Cal. Sept. 19, 1985) (memorandum of decision explaining summary judgment on all antitrust claims). In the first holding, the district court examined the impact of three federal programs: the Mandatory Oil Import Program (“MOIP”), federal price controls, and the entitlements program. It concluded that those three programs collectively precluded plaintiffs from recovering antitrust damages on the basis that defendants conspired to depress the price of their oil. See id. at 2-8; see also In re Coordinated Pretrial Proceedings, M.D.L. No. 150 (C.D.Cal. July 17, 1984) (price controls partial summary judgment); In re Coordinated Pretrial Proceedings, M.D.L. No. 150 (C.D.Cal. Dec. 13, 1984) (entitlements program partial summary judgment). In the second holding, the district court concluded that after eight years of discovery, plaintiffs had no proof of any antitrust conspiracy. See In re Coordinated Pretrial Proceedings, M.D.L. No. 150 slip op. at 8-9 (C.D.Cal. Sept. 19, 1985) (memorandum of decision explaining summary judgment on all antitrust claims).
Plaintiffs raise three issues on appeal: the Neeb issue, the exemption issue, and the Phase III issue. See supra p. 200 (issues B, A, and C respectively). Those three issues arise only in the context of the district court’s price controls ruling, which forms part of its MOIP-price controls-entitlements program holding. The majority dismisses plaintiffs’ appeal without prejudice because, in its words,
[a] final determination by the District Court concluding that appellants failed to make out a triable factual issue on their claims of existence of an illegal price-fixing conspiracy eliminated the hypothetical predicate of an illegal conspiracy by appellees which the District Court had assumed in reaching its rulings which were contained in the July 17,1984 Memorandum of Decision.
Supra p. 203. I agree with the majority that the Neeb issue, see supra p. 200 (issue B), is no longer a live issue in the case. I disagree, however, with the majority’s determination that we have no jurisdiction to decide the exemption and Phase III issues.
In its original price controls ruling, the district court assumed that defendants’ conspiracy caused the price controls to be lower than they would have been absent the conspiracy. In re Coordinated Pretrial Proceedings, M.D.L. No. 150 slip op. at 7-8 (C.D.Cal. July 17, 1984) (price controls partial summary judgment). The Neeb issue then was whether the district court correctly assessed the effect of federal price controls on defendants’ antitrust liability — that is, whether Mr. Neeb’s letter cut off defendants’ liability for their antecedent conspiracy. See supra p. 200 (issue B). The final judgments defendants now appeal no longer present the Neeb issue. The district court’s MOIP ruling in its September 19, 1985, memorandum of decision destroyed the factual predicate for *208the Neeb issue. See In re Coordinated Pretrial Proceedings, M.D.L. No. 150 slip op. at 2-8 (C.D.Cal. Sept. 19, 1985) (memorandum of decision explaining summary judgment on all antitrust claims). The Neeb issue assumed an antecedent antitrust conspiracy. By holding that the MOIP rather than defendants’ conspiracy caused the allegedly low price of California crude when price controls took effect, the district court erased its earlier assumption that defendants’ conspiracy caused lower price ceilings. The MOIP ruling therefore destroyed the underlying assumption of the Neeb issue. I agree with the majority that these appeals no longer present the Neeb issue, see supra p. 200 (issue B).
The majority, however, misses the distinction between the Neeb issue and the two other ESA issues. In not recognizing jurisdiction to decide the exemption and Phase III issues, see supra p. 200 (issues A and C respectively), the majority opinion ignores the district court’s language in its September 19,1985, memorandum decision. The district court based its decision on two alternative holdings, one of which necessarily decided two ESA issues and one of which involved no ESA issues. The district court stated:
The foregoing [(the MOIP-price controls-entitlements program ruling) ] is believed to provide a mandate for summary judgment for the defendants on the antitrust issues. However, in consideration of the possibility that higher authority might disagree, I shall devote the remainder of this memorandum to a discussion of my alternative reason for granting summary judgment: After more than eight years of discovery, the plaintiffs simply do not have the evidence to prove the antitrust conspiracy they allege.
See In re Coordinated Pretrial Proceedings, M.D.L. No. 150 slip op. at 8-9 (C.D. Cal. Sept. 19, 1985) memorandum of decision explaining summary judgment on all antitrust claims) (emphasis added). Even though the district court’s first holding no longer decided the Neeb issue, it still necessarily decided both the exemption and the Phase III issues. The district court did not suddenly retract that first holding, which was based on the three federal programs, when it articulated its alternative holding, which was based on lack of evidence. In fact, the district court set forth its alternative holding in case an appellate court reversed its MOIP-price controls-entitlements program holding.
Assume that the TECA did not exist and that plaintiffs had appealed on all issues to the Ninth Circuit. In that case, the Ninth Circuit could have decided the case by affirming the district court on the basis of the MOIP-price controls-entitlements program holding, without ever deciding whether there was sufficient evidence of an antitrust conspiracy. In other words, the Ninth Circuit could have affirmed the district court on the basis that plaintiffs are not entitled to antitrust damages as a matter of law without regard to whether there was any antitrust conspiracy. Under the majority’s holding, the Ninth Circuit cannot decide the case on that basis because the TECA will not decide the ESA issues in the district court’s first holding until at least the Ninth Circuit has decided that the district court erred in its second (lack of evidence) holding.
The majority refuses to decide the ESA issues because the Ninth Circuit may affirm the district court’s second (lack of evidence) holding and thus moot the ESA issues in the district court’s first holding. The same concern arises, however, in any case sustained by two alternative holdings, only one of which involves ESA issues. The Second Circuit foresaw this problem in Coastal States Marketing v. New England Petroleum Corp.:
We note, but do not resolve, the problem that might be posed by a district court adjudication in favor of a defendant that is alternatively rested on both ESA and non-ESA grounds. If appeals are noticed to both a court of appeals and the TECA, the choice of an appropriate initial appellate route might be influenced by a determination of whether appellate resolution of ESA issues is to be encouraged in the interests of promoting certainty concerning a complex regulatory scheme, or discouraged in the manner that resolu*209tion of constitutional issues is disfavored if non-constitutional grounds are available. The former approach suggests initial consideration by the TECA, with the court of appeals staying its appeal to await the TECA determination of the ESA issue. The latter approach suggests a stay of the TECA appeal, pending court of appeals resolution of the non-ESA issue.
604 F.2d 179, 187 n. 10 (2d Cir.1979). The Second Circuit never considered the possibility that an alternative, yet sufficient, basis for the district court’s decision might altogether deprive the TECA of jurisdiction over ESA issues in the other holding.
Dismissal by the TECA is not appropriate unless another court of appeals has already mooted the ESA issues. The district court decided the exemption and Phase III issues, and that brings those issues within the jurisdiction of the TECA. Texaco, Inc. v. Department of Energy, 616 F.2d 1193, 1198 (Temp.Emer.Ct.App.1979). That the Ninth Circuit may later moot those ESA issues does not preclude us from reviewing and deciding them now. Were that the case, the Ninth Circuit could say with equal logic that it could not review the second (lack of evidence) holding because a subsequent TECA decision might render that second holding moot. In other words, the Ninth Circuit could say that the sufficiency of the evidence issue in the second holding is hypothetical because the first holding may preclude recovery as a matter of law. Either the first (MOIPprice controls-entitlements program) holding or the second (lack of evidence) holding is sufficient alone, yet neither is necessary to sustain the judgment. The Ninth Circuit has already stayed its consideration of plaintiffs’ appeal pending a decision from this court. Speedy resolution of the ESA issues would allow the Ninth Circuit to resolve the entire case as quickly as possible on the basis of either the first (MOIPprice controls-entitlements program) or the second (insufficient evidence) holding, whichever it deems more appropriate. Therefore, I dissent from the majority opinion because I would review and decide the exemption and Phase III issues.