New Home Appliance Center v. Thompson

• Decision Date: 27 November 1957
• Docket Number: No. 5627.,5627.
• Parties: NEW HOME APPLIANCE CENTER, Inc., Appellant, v. W. G. THOMPSON, the Western Corp., doing business as Western Appliance Corp., W. Dan Bell, William Gibbons, Frances Hammond, William Lujan, Emil Berkowitz, T. E. Braunschweiger, Allied Appliances, Inc., the Denver Area Better Business Bureau, Inc., New York Furniture House, Inc., and the Daniels & Fisher Stores Company, Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

250 F.2d 881 (1957)

NEW HOME APPLIANCE CENTER, Inc., Appellant, v. W. G. THOMPSON, the Western Corp., doing business as Western Appliance Corp., W. Dan Bell, William Gibbons, Frances Hammond, William Lujan, Emil Berkowitz, T. E. Braunschweiger, Allied Appliances, Inc., the Denver Area Better Business Bureau, Inc., New York Furniture House, Inc., and the Daniels & Fisher Stores Company, Appellees.

No. 5627.

United States Court of Appeals Tenth Circuit.

November 27, 1957.

Dayton Denious, Denver, Colo., for appellant.

John F. Shafroth and George Louis Creamer, Denver, Colo. (W. Clayton Carpenter, Allan R. Phipps, Samuel S. Sherman, Jr., John W. Low and Philip S. Van Cise, Denver, Colo., on the brief), for appellees.

Before MURRAH, PICKETT and LEWIS, Circuit Judges.

MURRAH, Circuit Judge.

Holding that the complaint in this case, as amended, and as attempted to be amended, did not state a claim under the triple damage provisions of the antitrust acts, the trial court dismissed the complaint, and this appeal is from the judgment of dismissal.

The complaint, as amended, alleged that at all times complained of, the complainant was a discount retail dealer of brand name electrical appliances in Denver, Colorado, whose profit depended in a large measure upon volume through extensive newspaper advertising; that certain of the defendants were distributors or wholesale dealers through whom the complainant purchased its products for resale; that certain other named defendants were competitive retail dealers in all or some of the brand name products sold by the complainant; that the defendant, Better Business Bureau, was an organization to which all of the defendants belonged except New York Furniture, Inc.; that all the products purchased and sold by the retailer through the wholesalers are manufactured outside the State of Colorado and are shipped interstate to the retailers' stores, thence to the ultimate consumer; that in the course of its business operations, complainant purchases substantial amounts of these products, some of which are shipped direct to it interstate, and some have already come to rest prior to purchase. The complaint then states that the defendants formed a combination or conspiracy, the purpose, object and effect of which was to deny retail appliance dealers in Denver, Colorado free access to the channels of interstate commerce by preventing them from making interstate purchases; and requiring them to purchase their requirements of home appliances from local wholesalers in Colorado, and thus to fix the prices at which such products were to be sold retail by Denver retail dealers; to monopolize interstate commerce in wholesale appliances and to eliminate the complainant as a competitor in such trade.

Specific overt acts in furtherance of the conspiracy were set out in the complaint, namely: the refusal of the wholesalers to sell the complainant electrical appliances at the instance of the named retail competitors. It was further alleged that as a part of the same conspiracy, and in furtherance thereof, the defendants, acting in concert obtained agreements with the two daily newspapers in Denver to limit and restrict complainant's advertising by excluding it from the advertising columns for a period of seven weeks, and thereafter requiring complainant to advertise only those items "obtained through regular Denver wholesale channels" at prices and on terms approved by the supplying distributors, and forbidding the complainant to advertise certain brand name products on any terms.

It was further alleged that to accomplish the conspiracy, the Denver Better Business Bureau circulated disparaging matter of the complainant, calculated and intended to cause termination of its financing arrangements; and that it otherwise coordinated the efforts of the defendants in excluding and restricting the complainant's access to the advertising media in Denver. It was specifically alleged that by such concerted action, the defendants had restrained and monopolized a substantial part of interstate commerce by eliminating the plaintiff's competition and raising prices for home appliances to consumers in Denver and vicinity. Then followed specific allegations showing business losses to the complainant for the years involved.

After dismissal of the amended complaint, the complainant tendered further amendments tending to show in more specific detail the manner in which the acts complained of affected interstate commerce with resulting damages to the complainant. These tendered amendments were denied on the grounds that they added nothing to the validity of the complaint.

Basing its judgment squarely on Feddersen Motors v. Ward, 10 Cir., 180 F.2d 519, and Shotkin v. General Electric Co., 10 Cir., 171 F.2d 236, the trial court concluded that the complaint did not sufficiently allege facts from which it could be determined as a matter of law that the alleged conspiracy unduly restrained interstate commerce with requisite harmful effect to the public interest; that the complaint failed to allege with sufficient definiteness the volume of interstate trade, or that complainant's interstate purchases were adversely affected by the defendants' activities. Nor did the court think the defendants' refusal to deal with complainant on a purely local basis had any prohibited effect on interstate commerce as in Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S....