In re Mushroom Direct Purchaser Antitrust Litig..Eastern Mushroom Mktg. Coop. Inc.

• Decision Date: 23 August 2011
• Docket Number: Nos. 09–2257,09–2258.,s. 09–2257
• Citation: 2011 Trade Cases P 77573,655 F.3d 158
• Parties: In re MUSHROOM DIRECT PURCHASER ANTITRUST LITIGATION.Eastern Mushroom Marketing Cooperative Inc.; Kaolin Mushroom Farms Inc.; To–Jo Fresh Mushrooms Inc.; Cardile Mushrooms Inc.; Cardile Bros. Mushrooms Packaging; Monterey Mushrooms Inc.; Phillips Mushrooms Farms, L.P.; Modern Mushroom Farms Inc.; Sher–Rockee Mushroom Farm; C & C Carriage Mushroom Co.; John Pia; Brownstone Mushroom Farms Inc.; Country Fresh Mushroom Co.; Robert A. Feranto, Jr., t/a/ Bella Mushroom Farms; Forest Mushroom Inc.; Gaspari Bros. Inc.; Gino Gaspari & Sons, Inc.; Giorgio Mushroom Company; Giorgio Foods Inc.; Harvest Fresh Farms Inc.; Leone Pizzini and Son, Inc.; Louis M. Marson, Jr., Inc.; LRP Mushrooms Inc.; LRP–M Mushrooms LLC; Oakshire Mushroom Farm, Inc.; Michael Pia; South Mill Mushroom Sales, Inc.; United Mushroom Farms Cooperative, Inc., Appellants.
• Court: U.S. Court of Appeals — Third Circuit

655 F.3d 158

2011-2 Trade Cases P 77,573

In re MUSHROOM DIRECT PURCHASER ANTITRUST LITIGATION.Eastern Mushroom Marketing Cooperative Inc.; Kaolin Mushroom Farms Inc.; To–Jo Fresh Mushrooms Inc.; Cardile Mushrooms Inc.; Cardile Bros. Mushrooms Packaging; Monterey Mushrooms Inc.; Phillips Mushrooms Farms, L.P.; Modern Mushroom Farms Inc.; Sher–Rockee Mushroom Farm; C & C Carriage Mushroom Co.; John Pia; Brownstone Mushroom Farms Inc.; Country Fresh Mushroom Co.; Robert A. Feranto, Jr., t/a/ Bella Mushroom Farms; Forest Mushroom Inc.; Gaspari Bros. Inc.; Gino Gaspari & Sons, Inc.; Giorgio Mushroom Company; Giorgio Foods Inc.; Harvest Fresh Farms Inc.; Leone Pizzini and Son, Inc.; Louis M. Marson, Jr., Inc.; LRP Mushrooms Inc.; LRP–M Mushrooms LLC; Oakshire Mushroom Farm, Inc.; Michael Pia; South Mill Mushroom Sales, Inc.; United Mushroom Farms Cooperative, Inc., Appellants.

Nos. 09–2257

09–2258.

United States Court of Appeals, Third Circuit.

Argued April 28, 2011.Filed: Aug. 23, 2011.

Barry L. Refsin [Argued], Hangley, Aronchick, Segal & Pudlin, Philadelphia, PA, David M. Buckner, Adam M. Moskowitz, Thomas A. Tucker Ronzetti, Kozyak Tropin & Throckmorton, Miami, FL, John G. Odom, Stuart E. Des Roches, Andrew W. Kelly, John A. Meade, Odom & Des Roches, New Orleans, LA, Manuel J. Dominguez, Berman DeValerio, Palm Beach Gardens, FL, W. Ross Foote, David P. Smith, Percy Smith & Foote, Alexandria, LA, Bruce E. Gerstein, Kevin S. Landau, Noah Silverman, Garwin Gerstein & Fisher, New York, NY, for Direct Purchaser Class Plaintiffs, Plaintiff–Appellee.David P. Germaine, Vanek, Vickers & Masini, Chicago, IL, Ira N. Richards, Trujillo, Rodriguez & Richards, Philadelphia, PA, for Publix Super Markets, Inc., Plaintiff–Appellee.Moira E. Cain–Mannix, Scott D. Livingston, Bernard D. Marcus, Marcus & Shapira, Pittsburgh, PA, for Giant Eagle, Inc., Plaintiff–Appellee.William A. DeStefano [Argued], Terri A. Pawelski, Buchanan Ingersoll & Rooney, Martin I. Twersky [Argued], H. Laddie Montague, Jr., Berger & Montague, Philadelphia, PA, for Mushroom Cooperative Defendants, Defendant–Appellant.Jacqueline P. Rubin, Moses Silverman, Paul, Weiss, Rifkind, Wharton & Garrison, New York, NY, for Giorgio Mushroom Co., and Giorgio Foods, Inc., Defendant–Appellant.Mark A. Wachlin, Dilworth Paxson, Terri A. Pawelski, Buchanan Ingersoll & Rooney, Philadelphia, PA, for Franklin Farms, Inc., Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, for Creekside Mushrooms, Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, D. Richard Funk, Conner & Winters, Tulsa, OK, for JM Farms, Inc., Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, Neill C. Kling, Francis P. Newell, Harkins Cunningham, Martin I. Twersky [Argued], Berger & Montague, Philadelphia, PA, for Kitchen Pride Mushrooms, Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, Joel I. Fishbein, Rosen, Moss, Snyder & Bleefeld, Elkins Park, PA, Jeffrey A. Krawitz, Silverman, Bernheim & Vogel, Martin I. Twersky [Argued], Berger & Montague, Philadelphia, PA, for Mario Cutone Mushroom Co., Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, for Masha & Toto, Inc., TA M & T Mushrooms, Defendants.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, Amy R. Richter, Portland, OR, Martin I. Twersky [Argued], Berger & Montague, Philadelphia, PA, for Mushroom Alliance, Inc., Defendant.William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, for W & P Mushrooms, Inc., Defendant.Donna M. Albani, Glen Mills, PA, William A. DeStefano [Argued], Buchanan Ingersoll & Rooney, Philadelphia, PA, Thomas K. Schindler, Reger Rizzo & Darnall, West Chester, PA, Martin I. Twersky [Argued], Berger & Montague, Philadelphia, PA, for M.D. Basciani & Sons, Inc., Defendant–Appellant.Donald M. Barnes, Salvatore A. Romano, Porter, Wright, Morris & Arthur, Washington, DC, for Eastern Mushroom Marketing Coop., Defendant–Appellant.James A. Backstrom, Jr., Philadelphia, PA, Christopher E. Ondeck, Crowell & Moring, Washington, DC, for Amicus Curiae National Council of Farmer Cooperatives.Before: BARRY, HARDIMAN and TASHIMA,^* Circuit Judges.

OPINION OF THE COURT

HARDIMAN, Circuit Judge.

The Capper–Volstead Act of 1922 allows certain agricultural producers to form cooperatives without incurring antitrust liability. This appeal presents the novel question of whether a prejudgment order denying an agricultural cooperative the protections of the Capper–Volstead Act is immediately appealable under the collateral order doctrine. We hold it is not.

I

In late 2000, a group of mushroom farmers and related entities, most of whom are located in southeastern Pennsylvania, formed the Eastern Mushroom Marketing Cooperative (EMMC). The members of EMMC established minimum pricing policies and programs to improve their position in the market for raw, fresh mushrooms. Pursuant to one such program, EMMC purchased properties (typically from bankrupt mushroom farmers) and resold them with deed restrictions that prohibited mushroom farming. In 2003, the Antitrust Division of the United States Department of Justice (DOJ) initiated an investigation of EMMC. United States v. E. Mushroom Mktg. Coop., Inc., Civil Action No. 2:04–CV–5829, 2005 WL 3412413 (E.D.Pa. Sept. 9, 2005) ( Mushroom I ). Following its investigation, DOJ filed a Competitive Impact Statement that concluded, inter alia, that EMMC was an agricultural cooperative organized pursuant to the Capper–Volstead Act (the Act), 7 U.S.C. §§ 291–92. In 2005, EMMC and DOJ entered into a consent judgment that required EMMC to nullify the deed restrictions on six parcels it had sold and prohibited it from placing restrictions on parcels sold within ten years.¹Mushroom I, 2005 WL 3412413.

Soon after the consent judgment was filed, various private parties brought their own antitrust suits against EMMC and its members. In June 2006, the District Court consolidated seven class actions and one non-class action previously filed against EMMC and its members. Consequently, a group of mushroom purchasers, including mushroom wholesalers and large supermarkets (Purchasers), filed an amended antitrust class action against EMMC, thirty-seven members, officers and affiliates of members, and unidentified members and/or co-conspirators (Growers), alleging a conspiracy in violation of sections 1 and 2 of the Sherman Act and section 7 of the Clayton Act. See 15 U.S.C. §§ 1, 2, 18. Unlike the DOJ action, this consolidated class action alleged antitrust violations involving both EMMC's property purchase program and its minimum pricing policies. Although the specifics of the Purchasers' complaint are not germane to our decision regarding the jurisdictional question, the District Court's summary provides useful background information. The Purchasers alleged that the Growers

launched a “supply control” campaign by using membership funds [from EMMC] collected during 2001 and 2002 to acquire and subsequently dismantle non-EMMC mushroom growing operations in order to support and maintain artificial price increases. [The Purchasers] allege that the EMMC repeatedly would purchase a mushroom farm or a parcel of farmland and then sell or exchange that farm or parcel at a loss, attaching a permanent or long-term deed restriction to the land prohibiting the conduct of any business related to the growing of mushrooms....

[The Purchasers] further allege that [the Growers] collectively interfered with non-EMMC growers that sought to sell at prices below those set by the EMMC and pressured independent growers to join the EMMC. The pressure and coercion tactics alleged include threatening and/or implementing a group boycott in which EMMC members would not sell mushrooms to assist independent growers in satisfying their short-term supply needs and/or selling mushrooms to independent growers at inflated prices.

In re Mushroom Direct Purchaser Antitrust Litig., 621 F.Supp.2d 274, 279 (E.D.Pa.2009) ( Mushroom II ).

The District Court, after ruling on the Growers' motions to dismiss, bifurcated discovery and entertained cross-motions for partial summary judgment on the preliminary question of whether the Growers were exempt from the antitrust claims under the Capper–Volstead Act. The Court denied the Growers' motion and granted the Purchasers' motion, holding that EMMC was not a proper agricultural cooperative under the Capper–Volstead Act because one member, M. Cutone Mushroom Co., Inc., was not technically a grower of agricultural produce. Id. at 286. The District Court further opined that “[e]ven if all EMMC members satisfied the requirements to qualify the cooperative for the Capper–Volstead exemption, the exemption does not extend to protect cooperatives that conspire with non-cooperatives,” and it found that the uncontested facts of the case revealed an impermissible price-fixing conspiracy with a non-member mushroom distribution company. Id. at 286–91.² In response to the District Court's holding, the Growers filed this appeal. The Purchasers moved to dismiss, claiming that we lack jurisdiction to hear this case as an interlocutory appeal.³

II

“We necessarily exercise de novo review over an argument alleging a lack of appellate jurisdiction.” Montanez v. Thompson, 603 F.3d 243, 248 (3d Cir.2010). We have “jurisdiction of appeals from all final decisions of the district courts of the United States.” 28 U.S.C. § 1291 (emphasis added). Despite this final order requirement, the collateral order doctrine permits courts of appeals to hear interlocutory appeals from “a small set of prejudgment orders that are ‘collateral to’ the merits of an action and ‘too important’ to be denied immediate review.” Mohawk Indus., Inc. v. Carpenter, ––– U.S. ––––, 130 S.Ct. 599, 603, 175 L.Ed.2d 458 (2009) (quoting Cohen...