Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Burial marker company accuses cemetery owner of using its monopoly power to restrain competition, (Jul 23, 2013)

By Peter Reap, J.D., LL.M.

Clark Memorials of Alabama, Inc., a company which sells and installs granite, marble, and bronze monuments and markers for cemeteries, has filed suit in the federal district court in Birmingham, accusing SCI Alabama Funeral Services, LLC, the owner of Elmwood Cemetery in the Birmingham area, of adopting exclusive installation policies at the cemetery as part of a scheme of willful acquisition or maintenance of monopoly power.

According to the complaint, SCI is North America’s largest provider of funeral and cemetery services. As of December 31, 2012, SCI operated 1,437 funeral service locations and 374 cemeteries in North America. Elmwood Cemetery, comprising approximately 500 acres, provides the final resting place for over 200,000 persons and was ranked in 2002 as the 12th largest cemetery in the United States. Through its subsidiary, SCI sells cemetery-related merchandise, including monuments and markers, and merchandise installations.

On June 20, 2013, Clark alleges that SCI, through its Market Director for Central Alabama, announced that Clark’s days of using Elmwood Cemetery as its showplace for selling many of its monuments and markers “were over.” Clark was presented a letter banning Clark Memorials from Elmwood Cemetery. The pretextual reason for the banning was that Clark Memorials had violated Elmwood Cemetery’s rules and regulations, but Clark avers that the true reason was to acquire Clark’s customers, to exclude competition in the installation of memorials market, and to drive Clark out of business.

In its claim against SCI for violation of Section 2 of the Sherman Act, Clark alleges that SCI’s exclusive installation policies constitute an illegal tying arrangement which restrains competition. It claims that SCI has wrongfully tied the sale of cemetery lots to the preparation of foundations and the installation of monuments and markers. By implementing exclusive installation policies, SCI and its subsidiaries have exploited their control over the tying product (the burial lot) to force the buyer into the purchase of a tied service (the installation of memorials). Further, SCI has used its monopoly power to foreclose competition and gain a competitive advantage over Clark.

The complaint includes a claim for violation of the Alabama Antitrust Act and three claims for tortious interference. Clark seeks injunctive relief enjoining all violations of the antitrust laws by SCI and damages.

The complaint in Clark Memorials of Alabama, Inc. v. SCI Alabama Funeral Services, LLC, Case No. CV-13-U-1356-S, was filed July 22, 2013.

Attorneys: Leah O. Taylor (Taylor & Taylor) for Clark Memorials of Alabama, Inc.

Companies: Clark Memorials of Alabama, Inc.; SCI Alabama Funeral Services, LLC.

News: Antitrust AlabamaNews