Leonard v. Socony-Vacuum Oil Co.

• Decision Date: 08 January 1942
• Docket Number: No. 132.,132.
• Court: U.S. District Court — Western District of Wisconsin
• Parties: LEONARD v. SOCONY-VACUUM OIL CO., Inc., et al.

42 F. Supp. 369

LEONARD v. SOCONY-VACUUM OIL CO., Inc., et al.

No. 132.

District Court, W. D. Wisconsin.

January 8, 1942.

Louis Karasik, of New York City, Gerald J. Boileau, of Wausau, Wis., and Hiram Z. Mendow, of Minneapolis, Minn., and Maurice J. Dix, both of New York City (Boileau & Loeffler, of Wausau, Wis., of counsel), for plaintiff.

D. T. Searls, of Chicago, Ill., H. H. Thomas, of Madison, Wis., W. H. Dougherty, and Stanley M. Ryan, of Janesville, Wis. (Vinson, Elkins, Weems & Francis, of Houston, Tex., Thomas, Orr & Isaksen, of Madison, Wis., and Nolan, Dougherty, Grubb & Ryan, of Janesville, Wis., of counsel), for defendants.

STONE, District Judge.

Defendants have moved the Court for a summary judgment under Rule 56 of the Federal Rules of Civil Procedure, 28 U.S. C.A. following section 723c, dismissing certain particular claims of damages as set out in plaintiff's complaint.

The complaint alleges that plaintiff is a jobber of gasoline at Lidgerwood, North Dakota, and buys gasoline at wholesale prices for resale; that defendants were convicted of a conspiracy in which they were charged with violating the anti-trust laws in the "Madison oil case", United States v. Standard Oil Co., D.C., 23 F.Supp. 937, which judgment was sustained by the United States Supreme Court, United States v. Socony-Vacuum Oil Co., Inc., et al., 310 U.S. 150, 60 S.Ct. 811, 84 L.Ed. 1129; that plaintiff as such jobber of gasoline in the area referred to in the complaint, operated during the period referred to in the complaint bulk storage plants conveniently located to serve gasoline by truck and to gas stations.

The wording used in the allegation of the conspiracy in plaintiff's complaint is substantially the same as was used in the indictment in the criminal case above referred to. Plaintiff alleges that by reason of the two buying programs carried on by the defendants, a floor was sustained under the spot market, prices thereby arose, and jobbers in the Midwest area as a result paid a higher price for their gasoline.

This motion is concerned only with the gasoline that plaintiff resold, and is directed to plaintiff's claims for damages as follows:

Paragraph 45:

"(b) That by reason of the unlawful acts and conduct of the defendants, plaintiff was compelled to and did pay high prices for gasoline above the fair market price which would have existed had there been no conspiracy;

"(e) Plaintiff has been compelled to purchase gasoline in said Mid-Western area at a higher price than plaintiff would have under competition with normal market conditions."

These are the two claims of injury to plaintiff's business and property which are challenged by defendants' motion. Defendants contend that an allegation in a complaint by a gasoline jobber, who buys and resells gasoline, that he paid a higher purchase price by reason of a conspiracy without alleging that his selling price was not correspondingly increased, does not state a claim which entitles him to relief. Plaintiff contends that he is entitled to damage herein solely because of the conspiracy and the resultant increase to him of the buying price of gasoline purchased, regardless of whether or not such increase was passed on to plaintiff's customers by a corresponding increase in plaintiff's selling price.

This question was decided in the case of Twin Ports Oil Company v. Pure Oil Co., 8 Cir., 1941, 119 F.2d 747, 750, certiorari denied Oct. 13, 1941, 62 S.Ct. 84, 86 L.Ed. ___; motion for rehearing denied November 10, 1941, 62 S.Ct. 176, 86 L.Ed. ___. In that case, the plaintiff was a gasoline jobber and his claim for damages was based upon the conspiracy in the "Madison Oil case", the same as in the case at bar. The Court of Appeals for the Eighth Circuit said: "There was Cox's testimony, however, that, as a result of this buying program, the tank car prices of gasoline had been raised by a little over two cents per gallon. Of course this could in any event result in no damage to appellant, absent proof that its selling price was not correspondingly increased, * * *".

Other cases in point are H. E. Miller Oil Co. v. Socony-Vacuum Oil Co., Inc., et al., D.C.Mo.1941, 37 F.Supp. 831; Keogh v. Chicago & Northwestern Railway Co. et al., 260 U.S. 156, 43 S.Ct. 47, 67 L.Ed. 183.

The decision in the Twin Ports case is binding on this Court. If the question were before me as an original proposition, I would reach the same conclusions as did the Circuit Court of Appeals for the Eighth Circuit. A person is not entitled to recover treble damages under the Anti-trust Law unless he alleges and proves an injury to his business or property. 15 U.S.C.A. § 15.

The mere allegation of a conspiracy is insufficient. Glenn Coal Co. v. Dickinson Fuel Co. et al., 4 Cir., 72 F.2d 885. Plaintiff is a middleman and jobber and has not necessarily suffered any damage by the payment of an increased price for gasoline. The increase may have been passed on to his customers. The jobber's situation and right to recover from defendants herein is dependent upon both his buying and selling prices, and allegations in the complaint concerning only one of such prices is of no significance in determining the question of injury to the jobber's business or property. The burden is on the jobber to allege and prove the facts with respect to his selling price as well as his buying price.

The cases relied upon by pl...