Atlanta Brick Co. v. O'NEAL, 49.

• Decision Date: 19 February 1942
• Docket Number: No. 49.,49.
• Citation: 44 F. Supp. 39
• Parties: ATLANTA BRICK CO. v. O'NEAL.
• Court: U.S. District Court — Eastern District of Texas

44 F. Supp. 39

ATLANTA BRICK CO. v. O'NEAL.

No. 49.

District Court, E. D. Texas, Texarkana Division.

February 19, 1942.

Carney & Carney, of Atlanta, Tex., for plaintiff.

E. F. McFaddin and Steve Carrigan, both of Hope, Ark., for defendant.

DAWKINS, District Judge.

Plaintiff, R. S. Allday, alleges that he owns and operates a brick manufacturing plant at Atlanta, Texas, under the name of Atlanta Brick Company, and that defendant operates a similar plant at Hope, Arkansas; that each sells his products in both intrastate and interstate commerce in a trade territory embracing northeast Texas, southwest Arkansas, and southeast Oklahoma. The suit is for damages, and charges the violation of several Federal statutes, construction of which is alleged as the basis of jurisdiction of this court. The statutes are the Sherman Anti-Trust Act of July 2nd, 1890, as amended by the Miller-Tydings Act, 15 U.S.C.A. §§ 1-7, 15 note; the Clayton Act of October 15, 1914, 38 Stat. 730; the Federal Trade Commission Act of September 26th, 1914, as amended by the Lea-Wheeler Act of 1938, 15 U.S.C.A. § 41 et seq.; and the Robinson-Patman Act of June 19, 1936, 15 U.S. C.A. §§ 13, 13a, 13b, 21a.

Specifically, it is alleged that in December, 1940, plaintiff was the successful bidder for furnishing brick on a housing project at Texarkana, Arkansas, but that defendant caused its brick to be rejected by falsely representing to the architect of the building that plaintiff's brick would absorb an excessive amount of water, thus damaging him in the sum of $5,000; (2) That similar false representations by the defendant caused plaintiff's brick to be rejected on a National Guard Armory project at Prescott, Arkansas, with damages of $1,000; (3) That his brick were rejected for the same reason on a W. P. A. job at Magnolia, Arkansas, resulting in damages of $2,000; and (4) Similar results on a N. Y. A. building at Rison, Arkansas, which damaged plaintiff in the sum of $500.

Plaintiff further alleged that defendant has published and circulated widely false and misleading statements that the brick manufactured by plaintiff were unfit for use by reason of their water absorption, specifically stating that the brick would absorb water "like a sponge" thereby causing great damage to plaintiff's business and that "competition has been materially injured in the trade territory" in which plaintiff operates; that defendant has discriminated between purchasers of the same grade and quality of brick "transported in interstate commerce" which has lessened competition and tended to create "a monopoly" in violation of the Robinson-Patman Act; that defendant has thus sought to force plaintiff out of business; that defendant has gone to many places where plaintiff has sold brick and "picked out unfair samples and had same tested to show that the brick did not meet with Federal specifications"; that defendant has "entered into a conspiracy in restraint of trade and has set up a monopoly in the trade area" in question; that the conspiracy was with two other large dealers in the same territory, likewise engaged in interstate commerce "to control the sale of brick" by "pro-rating orders received by the three among themselves regardless of price, and thereby to hold up the price at one place and at other places to get the price so ruinously low as to stifle all competition and thereby to give to the three concerns a monopoly" in the territory and to force complainant to sell his plant at a great sacrifice; and that defendant "has made and offered rebates to prevent plaintiff from procuring a contract".

Article 12 of the petition is as follows: "Plaintiff further alleges that by reason of the premises, he has been damaged in the sum of $50,000.00 actual damages, and has been compelled to employ attorneys to bring this suit, and has agreed to pay said attorneys a reasonable fee for their services herein; that a reasonable fee would be the sum of $10,000.00."

The prayer is "for his damages trebled in the sum of $150,000" and "for his attorneys' fees in the sum of $10,000."

Defendant has filed (1) a motion to dismiss; (2) a motion to strike Articles 4, 5, 6 and 7 of the complaint; and (3) a motion for a bill of particulars.

1. The motion to dismiss charges that the bill does not state facts upon which relief can be granted and that none of the statutes relied on have any application.

Taking these statutes up in the order enumerated above, the Sherman Anti-Trust Act of July 2, 1890, as amended by the Miller-Tydings Act, makes unlawful "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or interstate commerce". 15 U.S.C.A. § 1. Section 7 of the Act as thus amended gives to "any person who shall be injured in his business or property" by anything "forbidden in the antitrust laws" the right to sue therefor "in any district court of the United States" in the District in which defendant resides or is found, without respect to the amount in controversy, and provides that he shall recover "three-fold the damages by him sustained, and the costs of suit, including a reasonable attorney's fees". The petition in this case charges that the defendant with two other brick manufacturers (names not given) combined to control the brick market in those portions of the three states above named, by fixing one price where there is no competition and in those sections where competition exists, reducing the price so low that others can not compete, thereby creating a monopoly of the brick business in interstate commerce in the section referred to for the benefit of those dealers. No specific instances or amounts are alleged, but this is more properly to be considered under the motion for a bill of particulars. That fact alone would not justify dismissal of the bill. The facts alleged in these four specific instances do not purport to connect the other two alleged conspirators therewith, and such damages as are alleged are not shown to have been caused by any violation of the Anti-Trust statute. Such acts are the result of some "contract, combination in the form of a trust or otherwise, or conspiracy, in restraint of trade or commerce". Contracts, combinations and conspiracies require the participation of more than one person; whereas the acts alleged with respect to these four transactions are simply those of the defendant, and amount to no more than a common law tort. Therefore, the only allegations to which the Anti-Trust laws can apply are to be found in the general charges of conspiracy and combination between the three brick manufacturers, two of whom are not named, found in Article 10 of the petition. With...