368 U.S. 464 (1962), 45, Poller v. Columbia Broadcasting System, Inc.

Docket Nº:No. 45
Citation:368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458
Party Name:Poller v. Columbia Broadcasting System, Inc.
Case Date:February 19, 1962
Court:United States Supreme Court
 
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Page 464

368 U.S. 464 (1962)

82 S.Ct. 486, 7 L.Ed.2d 458

Poller

v.

Columbia Broadcasting System, Inc.

No. 45

United States Supreme Court

Feb. 19, 1962

Argued November 13-14, 1961

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Syllabus

This action under § 4 of the Clayton Act to recover treble damages for losses allegedly resulting from violations of §§1 and 2 of the Sherman Act was brought by petitioner, who is the assignee of a dissolved corporation which formerly owned and operated WCAN, an ultra high frequency (UHF) television broadcasting station in Milwaukee, which was affiliated with the Columbia Broadcasting System (CBS) network. He alleged that, pursuant to a conspiracy to restrain and monopolize trade in the television broadcasting business, CBS purchased WOKY, a competing UHF station in Milwaukee, cancelled WCAN's network affiliation, thereby forced petitioner to sell WCAN to CBS at much less than its true value, and eliminated him from the broadcasting business in Milwaukee. He also alleged that a purpose of the conspiracy was to eliminate UHF broadcasting in Milwaukee and possibly throughout the United States. On the basis of pleadings, affidavits, depositions and interrogatories filed in the case, the District Court granted respondents' motion for a summary judgment on the ground that the injury suffered by petitioner was damnum absque injuria, since CBS had a right to purchase WOKY, subject to approval by the Federal Communications Commission, and to cancel its affiliation contract with WCAN.

Held: on this record, it cannot be said that "there is no genuine issue as to any material fact," within the meaning of Federal Rule of Civil Procedure 56(c), and the motion for summary judgment should not have been granted. Pp. 465-474.

(a) If the cancellation of WCAN's network affiliation and the purchase of WOKY by CBS were part and parcel of unlawful conduct or agreement with others or were conceived in a purpose to unreasonably restrain trade, control a market, or monopolize, as alleged in the complaint, then such conduct might well violate the Sherman Act, and the record indicates that, on a trial, petitioner might be able to substantiate his claim of conspiracy. Pp. 467-473.

(b) Summary procedures should be used sparingly in complex antitrust litigation where motive and intent play leading roles, the proof is largely in the hands of the alleged conspirators, and hostile witnesses thicken the plot. P. 473.

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(c) It cannot be said that no restraint of trade resulted from termination by CBS of its affiliation with WCAN because the public would still receive the same service from another source. Klor's v. Broadway-Hale Stores, 359 U.S. 207. P. 473.

109 U.S. App.D.C. 170, 284 F.2d 599, reversed.

CLARK, J., lead opinion

MR. JUSTICE CLARK delivered the opinion of the Court.

The question involved here is whether this treble damage action based on alleged violations of the restraint of trade and monopoly sections of the Sherman Law1 was rightly terminated by a summary judgment of dismissal. The petitioner, Lou Poller, is the assignee of the Midwest Broadcasting Company, a dissolved corporation. In 1954, Midwest was the owner and operator of WCAN, an ultra high frequency (UHF)2 broadcasting station

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located in Milwaukee. The station was affiliated with the Columbia Broadcasting System network, and was of the alleged value of $2,000,000. Poller charged that the respondents in 1954 entered into an unlawful conspiracy to eliminate WCAN from the broadcast field in Milwaukee.3 It was a part of the conspiracy that respondent Holt was to secure in his name an option to purchase WOKY, a competing but inferior UHF broadcaster in Milwaukee. When and if the Federal Communications Commission amended its multiple ownership rules, then under consideration, so as to permit CBS to own UHF stations in addition to its VHF ones, Holt was to assign his option to CBS if it so elected. In that event, it was agreed CBS would cancel its affiliation agreement with WCAN pursuant to its option in that contract, and, in due course, consummate its purchase of WOKY. This would place WCAN in the precarious position of competing with the two major national networks with stations in Milwaukee. Being unable to survive such competition, its only course would be to liquidate at distressed prices its valuable equipment and facilities only recently acquired. CBS might then acquire them at its own price for use in its new operation, which was necessary because of the inferior quality of those of WOKY. CBS would then have Midwest's superior facilities and equipment, which, with the WOKY license, would enable it to start broadcasting at a minimum expense and the least possible delay. Poller further claimed that the overall purpose of CBS was to destroy UHF broadcasting, which had only been permitted to enter the field in 1952, in order to protect its vast interest in VHF stations throughout the United States. Finally, he alleged the conspiracy was so [82 S.Ct. 488] successful that CBS not only acquired WCAN at a loss of

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$1,450,000 to Midwest, but that the latter was obliged to buy the facilities and equipment of WOKY at exorbitant prices, and to agree to continue broadcasting from the latter's premises -- which was done "in order to pretend that there was no restraint of trade or elimination of competition. . . ." However, WCAN continued in business only 10 days after CBS started its broadcasts on February 17, 1955. CBS discontinued UHF broadcasting in 1959, when it became affiliated with a Milwaukee VHF station.

At the hearing on the motion for summary judgment, the trial judge held that the injury suffered was damnum absque injuria, stating that CBS had a right to purchase WOKY, subject to Federal Communications Commission approval, and to cancel its affiliation contract with WCAN. 174 F.Supp 802. The Court of Appeals affirmed, with Judge Washington dissenting, 109 U.S.App.D.C. 170, 284 F.2d 599, and we granted certiorari, 365 U.S. 840. We now conclude that there was a genuine issue as to material facts, and that summary judgment was not therefore in order.

I

Summary judgment should be entered only when the pleadings, depositions, affidavits, and admissions filed in the case

show that [except as to the amount of damages] there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Rule 56(c), Fed.Rules Civ.Proc.. This rule authorizes summary judgment

only where the moving party is entitled to judgment as a matter of law, where it is quite clear what the truth is, . . . [and where] no genuine issue remains for trial . . . , [for] the purpose of the rule is not to cut litigants off from their right of trial by jury if they really have issues to try.

Sartor v. Arkansas Natural Gas Corp., 321 U.S. 620, 627 (1944). We now examine the contentions of the parties to determine whether under the rule summary judgment was proper.

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II

The respondents, in their motion for summary judgment, depended upon the affidavits of four persons. The first is Richard Salant, Vice President of CBS ; another, Jay Eliasberg, Director of its Research Division; a third, Lee Bartell, who made the sale of WOKY to CBS at a $50,000 profit; finally, Thad Holt, a codefendant who received $10,000 from the transaction. These were supplemented by material taken from petitioner's depositions of Salant and CBS President Stanton. It is readily apparent that each of these persons was an interested party.

Respondents appear to place most reliance on the Salant testimony, and we shall, therefore, take it up in some detail. It projects three defenses, the first being that there was no conspiracy for the following reasons: CBS-TV was not a separate entity, but only a division of CBS, and therefore there could be no conspiracy between the two; Holt, the cover man in securing the option and purchase of WOKY, "had been given the particular job" by CBS, and therefore was not a conspirator; and Bartell never shared in any illegal purpose that would bring him into the conspiracy. Secondly, in any event, the only issue in the case is the legality of the cancellation of the affiliation agreement by CBS which was merely the legal exercise by CBS of "the normal right of a producer to select the outlet for its product." And, finally, the monopoly charges are entirely "frivolous." The trial judge accepted the second defense.

III

It may be that CBS, by independent action, could have exercised its granted right to cancel WCAN's affiliation upon six months' notice and independently purchased its own outlet in Milwaukee. However, if such a cancellation [82 S.Ct. 489] and purchase were part and parcel of unlawful

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conduct or agreement with others or were conceived in a purpose to unreasonably restrain trade, control a market, or monopolize, then such conduct might well run afoul of the Sherman Law. See Times-Picayune Pub. Co. v. United States, 345 U.S. 594, 624-625 (1953); Eastman Kodak Co. v. Southern Photo Materials Co., 273 U.S. 359, 375 (1927). Poller alleges and the affidavits, depositions, and exhibits indicate much more than the free exercise by CBS of the granted right of cancellation. A conspiracy is alleged to restrain trade in the Milwaukee television market; to eliminate WCAN from that market; to secure its facilities at depressed prices; and to occupy the UHF band in that market exclusively. The right of cancellation was merely one of the means used to effectuate this conspiracy. Moreover, "in its wider sense," Poller claims that a part of their conspiracy was

to wipe out the most outstanding UHF operator in the...

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