Gregory v. Fort Bridger Rendezvous Ass'n

• Decision Date: 23 May 2006
• Docket Number: No. 04-8100.,04-8100.
• Citation: 448 F.3d 1195
• Parties: Sandy GREGORY; Richard Gregory, Plaintiffs-Appellants, v. FORT BRIDGER RENDEZVOUS ASSOCIATION, a Wyoming Non-Profit Association, Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1195

448 F.3d 1195

Sandy GREGORY; Richard Gregory, Plaintiffs-Appellants, v. FORT BRIDGER RENDEZVOUS ASSOCIATION, a Wyoming Non-Profit Association, Defendant-Appellee.

No. 04-8100.

United States Court of Appeals, Tenth Circuit.

May 23, 2006.

COPYRIGHT MATERIAL OMITTED

Bernard Q. Phelan, Phelan-Watson Law Office, Cheyenne, Wyoming, appearing for the Appellants.

Timothy W. Miller, Casper, Wyoming, appearing for the Appellee.

Before TACHA, Chief Circuit Judge, ANDERSON, and KELLY, Circuit Judges.

TACHA, Chief Circuit Judge.

This appeal arises from an action brought by Plaintiffs-Appellants Richard and Sandy Gregory against Defendant-Appellee Fort Bridger Rendezvous Association ("FBRA"). The Gregorys allege that the FBRA engaged in a horizontal group boycott by refusing to permit them to sell their goods at the Fort Bridger Rendezvous ("Rendezvous") in violation of § 1 of the Sherman Act. See 15 U.S.C. § 1. Based on the same conduct, the Gregorys also allege that the FBRA conspired to monopolize sales in violation of § 2 of the Sherman Act. See 15 U.S.C. § 2. The District Court granted summary judgment for the FBRA on both claims. We take jurisdiction under 28 U.S.C. § 1291 and AFFIRM.

I. BACKGROUND

The Rendezvous is a historical reenactment held each Labor Day weekend at the Fort Bridger Historical Site in Wyoming in which participants reenact an annual rendezvous held by local fur traders from 1825 to 1840. The weekend boasts competitions in shooting, archery, and knife-throwing contests, and, relevant to this appeal, hosts "traders" who sell accurate replicas of pre-1840 goods. The event attracts between 40,000-50,000 visitors and is the largest of its kind in the region.

The State of Wyoming granted the FBRA, a nonprofit volunteer organization, the exclusive right to conduct the Rendezvous. The FBRA has approximately ninety members, a majority of whom trade at the Rendezvous. Some of the members of the FBRA's fourteen-person Board of Directors are also traders. One need not be a member of the FBRA to trade at the Rendezvous, however, as fewer than half of the traders are members of the FBRA.

Among other things, the FBRA monitors traders' wares for authenticity and assigns to traders the limited number of trading spaces allowed by its state permit. Under the FBRA's method of assigning spaces, priority is given to traders who participated in the previous year's Rendezvous. In this way, if a trader files a timely application for space, he generally will receive the same space he occupied the year before. Applications received by traders who did not trade at the previous Rendezvous, or by traders who were at the previous Rendezvous but filed their applications after the deadline, are accepted on a first-come, first-served basis.

Although not members of the FBRA, the Gregorys were long-time and large-volume Rendezvous traders who offered a wide selection of goods at low prices as compared to most other traders—including traders who were members and directors of the FBRA. Due to their seniority, the Gregorys had obtained two coveted trading spaces on the front row of the event, which they maintained by making a timely application every year to the following year's Rendezvous.

In addition to selling their replica pre-1840 goods at the Rendezvous, the Gregorys also sold them at a trading post located on the grounds of the Fort Bridger Historical Site. Their trading-post sales of goods were governed by a contract with the State of Wyoming rather than by the FBRA, however, and were therefore not subject to the FBRA's standards of authenticity.¹ Nonetheless, the Gregorys sold many of the same goods at the trading post that they offered for sale at the Rendezvous. Additionally, the Gregorys have attended and sold their goods at twenty-five similar events in other parts of the country.

According to the Gregorys, in the late 1990s the FBRA launched an anticompetitive campaign against them. The Gregorys complain of the following conduct: (1) the Board, acting through a "trade committee," forced the Gregorys to stop selling "unauthentic goods," while other traders, including Board members, continued selling identical goods;² (2) the Board removed the camping spaces next to the Gregorys' trading space (which the Gregorys used for storage instead of camping) and created another trading space; (3) the Board voted to allow a trader only one space on the front row;³ (4) the Board proposed to auction off the Gregorys' commercially advantageous trading area that they earned by seniority, while no other spaces became the subject of a proposed auction; and (5) the Board proposed severely limiting the range of merchandise permitted under the replica pre-1840 standard, which would have adversely affected large-volume traders like the Gregorys.⁴

In response to these actions taken by the Board, Sandy Gregory initiated her own course of conduct against the FBRA. She wrote several letters to the Board, complaining of its proposals and of "personal grudges" that some directors had against them. She also wrote to the State of Wyoming and accused the FBRA directors of gross mismanagement, embezzlement, permit violations, and ethics violations. She asked for more state involvement and control over the FBRA and requested that the State keep her communications confidential. Ms. Gregory also secretly recorded a traders' meeting at the 2000 Rendezvous and several telephone conversations between her husband and Kash Johnson, Chairman of the Rendezvous and a director of the FBRA. She then wrote a letter to Mr. Johnson accusing him of being unethical, unprofessional, and "twisted with irrational anger."

Subsequently, the State of Wyoming instructed Mr. Johnson not to respond to future complaints from Ms. Gregory. As a result of this instruction, when the Gregorys sent their application to the FBRA in 2002 by registered mail, it was returned to them unopened. When Mr. Gregory asked Mr. Johnson why their application was returned, Mr. Johnson acknowledged that he had not realized that the returned letter was their application. Mr. Johnson told Mr. Gregory that if he resent it, it would be accepted. After the Gregorys reapplied and their application was accepted, however, the Board voted unanimously to reject the Gregorys' application for trading space at the 2002 Rendezvous and returned their application fee because of their "animosity and pattern of personal and professional attacks made upon the Board in their correspondence to both the Board members and the State of Wyoming."⁵ As a result, the Gregorys were not permitted to trade at the Rendezvous in 2002.⁶ The Gregorys contend that their ouster was orchestrated to eliminate competition and that the reason proffered by the FBRA—Ms. Gregory's unruly behavior —is pretextual.

The Gregorys filed suit against the FBRA, alleging violations of §§ 1 and 2 of the Sherman Act. The District Court granted summary judgment in favor of the FBRA after finding that the Gregorys failed to show a plurality of actors necessary to establish concerted action or a conspiracy as required by those provisions. This appeal followed.

II. DISCUSSION

A. Standard of Review

Under Federal Rule of Civil Procedure 56(c), we review a district court's grant of summary judgment de novo and apply the same legal standard used by the district court. Coffey v. Healthtrust, Inc., 955 F.2d 1388, 1391 (10th Cir.1992). "Summary judgment is appropriate when `there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law.'" Id. (quoting Fed.R.Civ.P. 56(c)) (alteration in original).

B. Section One of the Sherman Act

1. Concerted Action

Section 1 of the Sherman Act provides that "[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States ... is declared to be illegal." 15 U.S.C. § 1. Section 4 of the Clayton Act creates a private cause of action for any person who has been "injured in his business or property by reason of anything forbidden in the antitrust laws," and provides for treble damages. See 15 U.S.C. § 15(a); Full Draw Productions v. Easton Sports, Inc., 182 F.3d 745, 750 (10th Cir.1999).

Section 1 has been interpreted as prohibiting only concerted, multilateral action. See Bell v. Fur Breeders Agric. Coop., 348 F.3d 1224, 1232 (10th Cir.2003). Such action occurs when "two or more entities that previously pursued their own interests separately ... combin[e] to act as one for their common benefit" in the restraint of trade. See Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 769, 104 S.Ct. 2731, 81 L.Ed.2d 628 (1984). Underlying § 1's emphasis on concerted action is the rationale that when two formerly separate entities combine for their common benefit, their activity is "fraught with anti-competitive risk" because it "deprives the marketplace of the independent centers of decisionmaking that competition assumes and demands." Id. at 768-69, 104 S.Ct. 2731. For this reason, "unilateral conduct, regardless of its anti-competitive effects, is not prohibited" by § 1 of the Sherman Act. Motive Parts Warehouse v. Facet Enters., 774 F.2d 380, 386 (10th Cir.1985) (quoting Contractor Util. Sales v. Certain-teed Prods., 638 F.2d 1061, 1074 (7th Cir.1981)). Therefore, it is critical to distinguish between unilateral and concerted action in establishing a violation of § 1.

The general rule, sometimes termed the "single-entity rule," see Freeman v. San Diego Ass'n of Realtors, 322 F.3d 1133, 1147 (9th Cir.2003), is that coordinated activity within a corporation does not represent a plurality of actors necessary to establish concerted action, Copperweld Corp., 467 U.S. at 769, 104 S.Ct. 2731. The Supreme Court has explained that "[t]he officers of a single firm are not separate economic actors pursuing separate economic interests, so agreements among them do not suddenly...