Frontier Enterprises, Inc. v. Amador Stage Lines

• Decision Date: 02 October 1985
• Docket Number: Civ. No. S-83-940 MLS.
• Citation: 624 F. Supp. 137
• Parties: FRONTIER ENTERPRISES, INC., etc., et al., Plaintiffs, v. AMADOR STAGE LINES, INC., etc., et al., Defendants.
• Court: U.S. District Court — Eastern District of California

624 F. Supp. 137

FRONTIER ENTERPRISES, INC., etc., et al., Plaintiffs, v. AMADOR STAGE LINES, INC., etc., et al., Defendants.

Civ. No. S-83-940 MLS.

United States District Court, E.D. California.

October 2, 1985.

COPYRIGHT MATERIAL OMITTED

William L. Jaeger, Broad, Schulz, Larson & Wineberg, San Francisco, Cal., for plaintiffs.

James Duryea, Jr., San Francisco, Cal., for defendants.

MEMORANDUM AND ORDER

MILTON L. SCHWARTZ, District Judge.

Defendants' motion to dismiss or, in the alternative, for summary judgment was heard on April 6, 1984, and thereafter submitted. The court has considered all of the briefs and other written materials presented by the parties, including recently filed supplemental briefs, as well as the oral arguments made at the April 6, 1984 hearing, and now renders it decision.

In their complaint, plaintiffs allege that defendants have contracted, combined, and conspired to unreasonably restrain interstate commerce in violation of section 1 of the Sherman Act, 15 U.S.C. § 1, and have monopolized, attempted to monopolize, and combined and conspired to monopolize interstate trade and commerce in violation of section 2 of the Sherman Act, 15 U.S.C. § 2. Two separate lines of commerce are allegedly involved in this case: motor carrier passenger service between the Sacramento area and Northern Nevada, and tour broker service for tours which include such transportation. Plaintiffs claim that defendants "filed repetitive, overlapping and baseless protests, administrative appeals and judicial appeals, and initiated court litigation, without regard to merit, against anyone seeking ICC Interstate Commerce Commission authority to compete with defendants in the Sacramento area," (Complaint ¶ 21) and that defendants also "abused their monopoly in motor carrier passenger service for group casino tours in order to fix the prices paid by consumers for such tours, to gain unfair competitive advantages, and to extend their monopoly power into the above unregulated tour broker businesses through price squeezes, refusals to deal, restrictive tariffs...." (Complaint ¶ 21)

Defendants seek dismissal or summary judgment as to those claims concerning the special tariff and the protests and subsequent litigation concerning the applications of plaintiffs Quality Coach Lines, Inc. ("Quality") and Vaca Valley Bus Lines, Inc. ("Vaca Valley") for certificates of public convenience and necessity. They argue (1) that the above described allegations fail to state a claim upon which relief can be granted, (2) that this court lacks subject matter jurisdiction, and (3) that there are no triable issues of material fact.

Specifically, defendants contend that the allegations concerning the special tariff are "defective" because (1) the Interstate Commerce Commission ("ICC") found the tariff to be reasonable, nondiscriminatory and not to unreasonably restrain competition and plaintiffs cannot relitigate the issue of reasonableness under a Sherman Act theory in this court; (2) the district court has no jurisdiction to entertain a collateral attack on an ICC decision; and (3) since the ICC approved the special tariff, defendants are immune from antitrust liability for using the tariff. With respect to the allegations regarding "sham protests," defendants urge that the ICC and the Ninth Circuit have found merit to their protests and that plaintiffs are precluded, under the doctrine of collateral estoppel, from relitigating that issue in this forum. The court will address the arguments concerning the special tariff first.

Plaintiffs allege that on January 1, 1981, defendants began using a "special tariff" under which the rates charged to plaintiff Frontier Enterprises, Inc. ("Frontier") and other tour agents were 25 percent lower than the regular published rates of defendant Amador Stage Lines, Inc. ("Amador"). Additionally, the tariff provided that "all fares sold under this tariff are net non-commissionable, and all travel arrangements must be provided by Amador Stage Lines, Inc." Plaintiffs allege that defendants used this "special tariff" for three reasons: (1) to drive tour agents and brokers, such as Frontier, out of the casino group tour business by depriving them of broker and casino commissions; (2) to subject tour agents and brokers to a price squeeze; and (3) to fix and standardize prices for casino group tours.

Before addressing the merits of the parties' arguments, the court must decide whether to treat defendants' motion as one for dismissal or summary judgment. As previously noted, defendants seek dismissal or summary judgment on the ground that the complaint fails to state a claim upon which relief can be granted (a Fed.R.Civ.P. 12(b)(6) motion) and that this court lacks subject matter jurisdiction (12(b)(1)). The court may, when considering a 12(b)(1) motion, look to matters outside the pleadings. If, however, on a 12(b)(6) motion the court is presented with and does not exclude matters outside the pleadings, "the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56." Fed.R.Civ.P. 12(b). In this case, the court has considered matters outside the pleadings, some of which are not subject to judicial notice. Therefore, except to the extent it addresses subject matter jurisdiction the motion will be treated as one for summary judgment.

As the Ninth Circuit stated in National Industries v. Republic National Life Insurance Co., 677 F.2d 1258, 1265-66 (9th Cir.1982), summary judgment should be granted

if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that 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. Fed.R.Civ.P. 56(c). For this purpose, all permissible inferences from the evidence must be drawn in favor of the non-moving party. Castaneda v. Dura-Vent Corp., 648 F.2d 612, 617 (9th Cir. 1981).

The moving party has the burden of demonstrating the absence of a genuine issue of material fact, regardless of where the ultimate burden of proof would lie at trial. Long v. Bureau of Economic Analysis, 646 F.2d 1310, 1320-21 (9th Cir.), vacated on other grounds, 454 U.S. 934, 102 S.Ct. 468, 70 L.Ed.2d 242 (1981); Bieghler v. Kleppe, 633 F.2d 531, 533 (9th Cir.1980); Weisberg v. United States Dept. of Justice, 627 F.2d 365, 368 (D.C.Cir.1980). It is not enough for the moving party to present evidence that is legally sufficient to support a judgment in its favor or, put another way, evidence upon which a reasonable trier of fact could rationally base a verdict in its favor. That formulation of the standard would ignore that a reasonable trier of fact might also construe the same evidence to support a different result. Contradictory inferences may be drawn from undisputed evidentiary facts. Neely v. St. Paul Fire & Marine Ins. Co., 584 F.2d 341, 345 (9th Cir.1978). However, summary judgment should be granted when the evidence in support of the motion would, if uncontradicted, entitle the moving party to a directed verdict were the case to proceed to trial. Bieghler, supra, 633 F.2d at 533; British Airways Board v. Boeing Co., 585 F.2d 946, 951 (9th Cir.1978), cert. denied, 440 U.S. 981, 99 S.Ct. 1790, 60 L.Ed.2d 241 (1979); Neely, supra, 584 F.2d at 344-45. Accordingly, the movant's evidence should demonstrate as a matter of law the absence of genuine issues of fact to present to the fact-finder. Garter-Bare Co. v. Munsingwear, Inc., supra, 650 F.2d 975 at 979 (9 Cir.1980) ; Neely, supra, 584 F.2d at 344-45.

If that burden is satisfied, then the party opposing the motion must present sufficient evidence supporting a claimed factual dispute so as "to require a jury or judge to resolve the parties' differing versions of the truth at trial." First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 289, 88 S.Ct. 1575, 1592, 20 L.Ed.2d 569 (1968); British Airways Bd., supra, 585 F.2d at 952; Neely, supra, 584 F.2d at 344. The non-moving party may not rest upon the mere allegations of its pleadings to resist an adequately-supported motion for summary judgment. Castanada, supra, 648 F.2d at 617.

The court is aware that summary judgment is not favored in antitrust cases particularly where motive and intent are at issue. Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962); Coca-Cola Co. v. Overland, Inc., 692 F.2d 1250, 1257 (9th Cir.1982). Such relief, however, is not precluded in antitrust cases and, when properly used, is a valuable means of preserving scarce judicial resources. Coca-Cola, 692 F.2d at 1257.

The court turns first to the question of whether it has subject matter jurisdiction over this case. According to 28 U.S.C. § 2321:

Except as otherwise provided by an Act of Congress, a proceeding to enjoin or suspend, in whole or in part, a rule, regulation, or order of the Interstate Commerce Commission shall be brought in the court of appeals as provided by and in the manner prescribed in chapter 158 of this title.

The Hobbs Act provides, in pertinent part, that the court of appeals' jurisdiction under section 2321 is exclusive. 28 U.S.C. § 2342. See also Pullman-Standard, a Div. of Pullman, Inc. v. I.C.C., 705 F.2d 875 (7th Cir.1983). The only exception to this general grant of jurisdiction is found at 28 U.S.C. § 1336(a), which provides that district courts have exclusive jurisdiction to review ICC orders "for the payment of money or the collection of fines, penalties and forfeitures." City of New Orleans v. Southern Scrap Material, 704 F.2d 755, 759-60 n. 18 (5th Cir.1983); Island Creek Coal Sales Co. v. I.C.C., 561 F.2d 1219 (6th Cir.1977); Southern Pac. Transp. Co. v. California Coastal Comm'n, 520 F.Supp. 800 (N.D.Cal.1981). Defendants argue that the allegations contained in paragraphs 24 and 26 of plaintiffs' complaint constitute a collateral attack on an order...