Olympia Equipment v. Western Union Telegraph

• Decision Date: 06 October 1986
• Docket Number: No. 85-3150.,85-3150.
• Citation: 802 F.2d 217
• Parties: OLYMPIA EQUIPMENT LEASING COMPANY, ALFCO Telecommunications Company, and Paula Jeanne Feldman, personal representative of the estate of Abraham Feldman, Plaintiffs-Appellees, v. WESTERN UNION TELEGRAPH COMPANY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

802 F.2d 217

OLYMPIA EQUIPMENT LEASING COMPANY, ALFCO Telecommunications Company, and Paula Jeanne Feldman, personal representative of the estate of Abraham Feldman, Plaintiffs-Appellees, v. WESTERN UNION TELEGRAPH COMPANY, Defendant-Appellant.

No. 85-3150.

United States Court of Appeals, Seventh Circuit.

On Rehearing October 6, 1986.

Andrew Hartzell, Jr., Debevoise & Plimpton, New York City, for defendant-appellant.

Bruce S. Sperling, Paul E. Slater, Stephen J. Spitz, Sperling, Slater & Spitz, Chicago, Ill., for plaintiffs-appellees.

Before BAUER, Chief Judge, and POSNER and FLAUM, Circuit Judges.

PER CURIAM.

Olympia has petitioned for rehearing (with the suggestion that it be en banc) of our decision of July 18, 1986, ordering that the complaint be dismissed. 797 F.2d 370. Since all the members of the original panel have voted against rehearing, and no judge in regular active service on this court has voted for rehearing en banc, the petition is DENIED.

We have thought it appropriate to make a brief statement, however, in response to the principal ground urged for rehearing this matter, which is that the panel "avoided and counter-attacked," rather than following, the Supreme Court's decision in Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 105 S.Ct. 2847, 86 L.Ed.2d 467 (1985). The other points raised in the petition for rehearing are either ancillary to this one or rest on errors of fact and misstatements concerning the panel's opinion, and, as pointed out in Western Union's answer to the petition, on assertions inconsistent with representations made by Olympia at the argument of the appeal.

The petition characterizes as willful the panel's refusal to accept Olympia's argument that the outcome of this case is dictated by Aspen. The petition suggests that the panel considered Aspen "trumped" by a 10-year-old book written by a member of the panel — a book not cited or mentioned by the parties, or in the panel's unanimous opinion. The petition both characterizes the opinion as a "frontal assault" on Aspen and suggests that it is a sneaky end run effected by making findings of fact at the appellate level.

Barely visible behind the clouds of invective is a serious and debatable argument concerning the scope of Aspen, to which the panel devoted extended consideration. See 797 F.2d at 377-79. Although recognizing the possibility that reasonable persons might differ on the proper interpretation of Aspen in the circumstances of the present case, we adhere to our conclusion that Aspen is distinguishable and that in this case no rational finder of fact could find exclusionary conduct.

The uncontested facts show that Western Union, as a means of making its exit from the market for telex terminal equipment, provided its salesmen with a list of independent vendors of such equipment, including Olympia, but that later, deciding that liquidation of its own equipment inventory was proceeding too slowly, withdrew the list, thereby compelling Olympia to recruit its own sales force, which it was unable to do. We held that on these facts no violation of section 2 of the Sherman Act could be found.

Aspen, as we pointed out, is generically similar to this case in that it too is a case about the severing of a cooperative relationship between a firm with monopoly power and a competing firm. But there the resemblance ends. Aspen Skiing owned three of the four mountains in the Aspen ski complex, and Aspen Highlands the other one. Each company offered their customers a joint ticket — i.e., one usable on all four mountains — because the customers wanted the variety. The litigation was precipitated by Aspen Skiing's decision to stop offering the joint ticket. Skiers would now have a choice between buying one ticket from Aspen Skiing, giving them access to three mountains, or, if they also wanted the fourth, buying two tickets.

The differences between Aspen and the present case are numerous. First, the joint ticket (a) was used in other multi-mountain ski complexes and (b) had originated in Aspen at a time when the various mountains had been under separate ownership and competed with each other. The vendor list in this case, which in effect made Western Union's sales force the sales force for competing suppliers of telex terminal equipment as well, was not shown to be common in the industry or the kind of convenience that customers will demand and be supplied in a competitive market. Indeed, it was a device by which Western Union was trying to ease its way out of this market. Second, and related, competition had forced Aspen Skiing to enter into a cooperative relationship with Aspen Highlands. The Court held that the acquisition of monopoly power did not authorize Aspen Skiing to terminate the...