Antitrust Law Daily Wrap Up, ANTITRUST NEWS: High court asked to consider exclusion of evidence of past trade restraints, (Oct 17, 2013)

By Jeffrey May, J.D.

Distributors of heating and air conditioning equipment have asked the U.S. Supreme Court to review an unpublished decision of the U.S. Court of Appeals in San Francisco rejecting their antitrust claims against competitors. The complaining distributors filed a petition for certiorari with the Court on October 9 (Advanced Microtherm, Inc. v. Norman Wright Mechanical Equipment Corp., Dkt. 13-466).

At issue is a Ninth Circuit decision in an action brought by new market entrants Advanced Microtherm, Inc. and HVAC Sales, Inc. against Norman Wright Mechanical Equipment Corp., F.W. Spencer & Son, Inc., and other parties, alleging various violations of federal and state antitrust law in the supply of heating and ventilation products for construction projects. The plaintiffs described a market rife with bribery and anticompetitive conduct.

With little elaboration, the appellate court upheld a lower court’s decision granting summary judgment to Norman Wright on bid rigging, tying, conspiracy, and exclusive dealing claims, and granting summary judgment to Spencer on all claims against it. Also at issue in the appeal were jury instructions. A jury had decided for Norman Wright on attempted monopolization, commercial bribery, and intentional interference with a contract claims.

The petitioners have asked the Court: (1) whether a pre-existing price fixing agreement in a market is admissible evidence to show the motive, intent, and purpose of predatory acts against a new entrant; (2) whether bribes to secure tying arrangements that exclude the plaintiff from substantial markets is a per se violation of the antitrust laws; (3) whether it was error to instruct a jury that it may not consider the overall effect of bribes on all customers receiving them, but rather may only consider them on a project-by-project basis, in a market saturated by massive commercial bribes; (4) whether a federal court deprives an antitrust plaintiff of due process by applying a more stringent federal tying standard to a California state law tying claim; and (5) whether the credibility of an impeached material witness is a determination for the jury, or may a court substitute its view of the testimony and then grant directed verdict on that interpretation.

“In this case, the evidence of prior trade restraints in the market would have given the jury the motive, purpose, and intent of the subsequent act against the plaintiffs, and demonstrate that those anticompetitive acts were in furtherance of the defendants’ past control of the market,” the petitioners argued.

A response is due November 14, 2013.

Attorneys: Joseph M. Alioto (Alioto Law Firm) for Advanced Microtherm, Inc.

Companies: Advanced Microtherm, Inc.; HVAC Sales, Inc.; Norman Wright Mechanical Equipment Corp.; F.W. Spencer & Son, Inc.

News: Antitrust