Misco, Inc. v. U.S. Steel Corp.

• Decision Date: 19 February 1986
• Docket Number: No. 84-5890,84-5890
• Citation: Misco, Inc. v. U.S. Steel Corp., 784 F.2d 198 (6th Cir. 1986)
• Parties: 1986-2 Trade Cases 67,191, 4 Fed.R.Serv.3d 221 MISCO, INC., Mid-South Aluminum Company, and Everett W. Fielder, Jr., Plaintiffs-Appellants, v. UNITED STATES STEEL CORPORATION and Alside, Incorporated, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 198

784 F.2d 198

1986-2 Trade Cases 67,191, 4 Fed.R.Serv.3d 221

MISCO, INC., Mid-South Aluminum Company, and Everett W Fielder, Jr., Plaintiffs-Appellants, v. UNITED STATES STEEL CORPORATION and Alside, Incorporated Defendants-Appellees.

No. 84-5890.

United States Court of Appeals, Sixth Circuit.

Argued Sept. 30, 1985.

Decided Feb. 19, 1986.

Robert Johnson, Wildman, Harrold, Allen, Dixon, Memphis, Tenn., William L. White, Jr., Gen. Atty., U.S. Steel Corp., Pittsburg, Pa., Leon R. Goodrich (argued), Oppenheimer, Wolff, Foster, Shepard & Donnelly, W. Joseph Bruckner, St. Paul, Minn., James R. Bussman, Akron, Ohio, for defendants-appellees.

Larry E. Parrish (argued), Parrish & Mulrooney, Memphis, Tenn., Fred M. McDonald, for plaintiffs-appellants.

Before MARTIN and JONES, Circuit Judges, and CELEBREZZE, Senior Circuit Judge.

CELEBREZZE, Senior Circuit Judge.

Plaintiffs-appellants Misco, Inc., Mid-South Aluminum Company, and Everett W. Fielder (collectively referred to as "Misco") appeal from the district court's rulings in favor of defendants-appellees United States Steel Corporation ("USS") and USS' wholly-owned subsidiary Alside, Inc. on their federal antitrust and Tennessee common law and statutory breach of contract claims. On appeal, Misco alleges that the district court committed numerous errors in reaching its decisions. After carefully considering each contention, we affirm in part, reverse in part, and remand for further proceedings.

The district court assumed, without ever explicitly deciding, that the following facts taken from Misco's complaint were true. Fielder was the sole shareholder in Mid-South Aluminum Company (Mid-South), located in Nashville, Tennessee. In 1966, Mid-South and Alside, Inc. ("Alside") entered into an exclusive dealership agreement. Under the agreement, Mid-South in exchange for agreeing to retail Alside products was given the exclusive rights to retail Alside products in middle Tennessee. ¹ In June, 1969, Alside became a wholly-owned subsidiary of USS and shortly thereafter Alside approached Fielder and requested a change in the existing contract. Alside represented to Fielder that due to a change in marketing strategy Alside needed a wholesale distributor of its products in the middle Tennessee area. The representatives promised Fielder that if he undertook this obligation Alside would make him its exclusive wholesaler in the middle Tennessee area. Fielder agreed and established Misco, Inc. to perform the new contract. On July 24, 1974, executives from Alside had a meeting with Fielder and informed him that Alside was opening a warehouse in the Nashville area. Alside opened a warehouse in Nashville in September, 1974 and Misco commenced this action in April, 1978.

Misco in its complaint alleged that Alside and USS violated Section 1 of the Sherman Act, 15 U.S.C. Sec. 1 (1982), and Sections 2(a), 2(d), and 2(e) of the Robinson-Patman Act, 15 U.S.C. Secs. 13(a), 13(d), 13(e) (1982). Misco further contended that Alside breached its exclusive dealership contract with Misco and that USS wrongfully induced the breach in contravention of Section 47-50-109 of the Tennessee Code, Tenn.Code Ann. Sec. 47-50-109 (1984). The district court dismissed Misco's claims under Section 1 of the Sherman Act, Sections 2(d) and 2(e) of the Robinson-Patman Act, and Section 47-50-109 of the Tennessee Code for failing to state claims upon which relief could be granted. See Fed.R.Civ.P. 12(b)(6). After some discovery, the district court granted Alside's and USS' motion for summary judgment on Misco's claim under Section 2(a) of the Robinson-Patman Act. Finally, following a trial on the record, the district court determined that Alside had not breached its contract with Misco. On appeal, Misco attacks all of the district court's holdings and argues that the district court improperly refused to consider its untimely demand for a jury trial and erroneously categorized its "requests for admissions" as interrogatories. We will consider the antitrust claims first, the state law actions second, and the procedural issues last.

A complaint may only be dismissed under Rule 12(b)(6) if the allegations in the complaint appear beyond doubt not to support a claim for which relief may be granted. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957). The district court, in this case, ruled that Misco's claims under Section 1 of the Sherman Act and Sections 2(d) and 2(e) of the Robinson-Patman Act failed to state actionable claims. We consider each claim in turn.

Misco alleges that Alside and USS violated Section 1 of the Sherman Act by conspiring to eliminate competition in the marketing of siding. In order to state a claim under Section 1, the plaintiff must allege the existence of concerted activity. See United States v. Colgate & Co., 250 U.S. 300, 39 S.Ct. 465, 63 L.Ed. 992 (1919). Misco concedes, as it must, that Alside being a wholly-owned subsidiary of USS is and has been since June 1969 incapable of conspiring with USS. Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 104 S.Ct. 2731, 2745, 81 L.Ed.2d 628 (1984); see Russ' Kwik Car Wash, Inc. v. Marathon Petroleum Co., 772 F.2d 214, 221 (6th Cir.1985) (per curiam). Misco, however, asserts that the conspiracy between Alside and USS began before USS acquired Alside and that USS' acquisition of Alside in 1969 was part of the conspiracy. Even accepting these assertions, Misco's complaint was still filed over nine years after the last overt act, USS' acquisition of Alside. Thus, since the "statute of limitations commences to run from the commission of the last overt act causing injury or damage," Akron Presform Mold Co. v. McNeil Corp., 496 F.2d 230, 233 (6th Cir.), cert. denied, 419 U.S. 997, 95 S.Ct. 310, 42 L.Ed.2d 270 (1974), Misco's action is barred by the four year statute of limitations applicable to antitrust actions. 15 U.S.C. Sec. 15b (1982). Accordingly, the district court correctly dismissed Misco's Section 1 conspiracy claim.

Misco also alleged in its complaint that Alside and USS violated Sections 2(d) and 2(e) of the Robinson-Patman Act. The gravamen of an action under either Section 2(d) or Section 2(e) is that the defendant is supplying services to one customer but not to another. See FTC v. Fred Meyer, Inc., 390 U.S. 341, 343, 350-51, 88 S.Ct. 904, 905, 909, 19 L.Ed.2d 1222 (1968); Bouldis v. U.S. Suzuki Motor Corp., 711 F.2d 1319, 1327-28 (6th Cir.1983). In this case, Misco's complaint never once alleged that Alside or USS discriminated in the supplying of services to their customers. Dismissal under Rule 12(b)(6) was, therefore, appropriate.

Similarly, Misco contends that Alside and USS violated Section 2(a) of the Robinson-Patman Act by discriminating in the prices which they charged their customers. The district court granted summary judgment in Alside's and USS' favor on this claim. Summary judgment may only be granted if, viewing the evidence in the light most favorable to the non-moving party, there is no issue of material fact. Fed.R.Civ.P. 56(c); SEC v. Blavin, 760 F.2d 706, 710 (6th Cir.1985) (per curiam). Further, in antitrust litigation summary procedures should be used sparingly. Poller v. Columbia Broadcasting System, 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962); Smith v. Northern Michigan Hospitals, Inc., 703 F.2d 942, 947-48 (6th Cir.1983).

Section 2(a) of the Robinson-Patman Act only applies to sales which are "in commerce." 15 U.S.C. Sec. 13(a) (1982). The in commerce jurisdictional prerequisite is met only if one of the alleged discriminatory sales crossed a state line. Gulf Oil Corp. v. Copp Paving Co., 419 U.S. 186, 198-201, 95 S.Ct. 392, 400-01, 42 L.Ed.2d 378 (1974); S & M Materials Co. v. Southern Stone Co., 612 F.2d 198, 200 (5th Cir.), cert. denied, 449 U.S. 832, 101 S.Ct. 101, 66 L.Ed.2d 37 (1980); Willard Dairy Corp. v. National Dairy Products Corp., 309 F.2d 943, 946 (6th Cir.1962), cert. denied, 373 U.S. 934, 83 S.Ct. 1534, 10 L.Ed.2d 691 (1963). Misco's complaint lacks any allegation and Misco has failed to adduce any evidence tending to show that any of the discriminatory sales crossed state lines. In these circumstances, the district court did not err in granting summary judgment. We next consider Misco's state law claims.

Misco asserts that the district court erred in ruling in favor of Alside and USS on its breach of contract claim. The district court relied upon two grounds in rejecting Misco's claim: first, that Misco initially breached the exclusive dealership contract and, second, that Misco received adequate notice of the termination. Although a district court's findings of fact must be upheld by a reviewing court unless clearly erroneous, Fed.R.Civ.P. 52(a); Anderson v. City of Bessemer City, North Carolina, --- U.S. ----, 105 S.Ct. 1504, 1511-12, 84 L.Ed.2d 518 (1985), an appellate court may reverse a district court's factual findings if, based on the entire record, it is left with a definite and firm conviction that a mistake has been committed, United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746 (1948).

The district court first determined that "no factual dispute" existed concerning the fact that Misco initially terminated the exclusive dealership agreement. This finding lacks any support in the record. The district court, in support of its holding, noted that Fielder admitted that he took action inconsistent with his position as Alside's exclusive dealer on June 24, 1974, ² exactly one month before the July 24, 1974 meeting. As the district court acknowledged in its opinion, however, Fielder took this action only after having been informed by Dan Smith, an Alside Sales Representative, that Alside planned to open a warehouse in Nashville. Dan Smith in his sworn statement averred that in a meeting in February 1974, he was told by O.J. French, Alside's Divisional Sales Manager, in the...