Race Tires America v. Hoosier Racing Tire

• Decision Date: 15 September 2009
• Docket Number: No. 02:07-cv-01294.,02:07-cv-01294.
• Parties: RACE TIRES AMERICA, INC., a Division of Specialty Tires of America, Inc.; Specialty Tires of America, Inc.; Specialty Tires of America (Pennsylvania), Inc.: and Specialty Tires of America (Tennessee), LLC, Plaintiffs, v. HOOSIER RACING TIRE CORP., and Dirt Motor Sports, Inc. d/b/a World Racing Group, Defendants.
• Court: U.S. District Court — Western District of Pennsylvania

660 F.Supp.2d 590

RACE TIRES AMERICA, INC., a Division of Specialty Tires of America, Inc.; Specialty Tires of America, Inc.; Specialty Tires of America (Pennsylvania), Inc.: and Specialty Tires of America (Tennessee), LLC, Plaintiffs, v. HOOSIER RACING TIRE CORP., and Dirt Motor Sports, Inc. d/b/a World Racing Group, Defendants.

No. 02:07-cv-01294.

United States District Court, W.D. Pennsylvania.

September 15, 2009.

COPYRIGHT MATERIAL OMITTED

Alan B. Rosenthal, Joseph Decker, Mark D. Shepard, Babst, Calland, Clements & Zomnir, Mark K. Dausch, Pittsburgh, PA, Thomas M. Schultz, Polymer Enterprises, Inc., Greensburg, PA, for Plaintiffs.

Aaron M. Staser, Deborah E. Pollack-Milgate, Donald E. Knebel, Lynn C. Tyler, Barnes & Thornburg, Indianapolis, IN, Donna M. Doblick, Jason E. Hazlewood, Reed Smith, John R. Gotaskie, Jr., Fox Rothschild LLP, Pittsburgh, PA, Kendall H. Millard, Barnes & Thornburg, South Bend, IN, Theodore H. Jobes, Fox Rothschild LLP, Philadelphia, PA, for Defendants.

MEMORANDUM OPINION AND ORDER OF COURT

TERRENCE F. McVERRY, District Judge.

Presently before the Court for disposition are the following:

• MOTION FOR SUMMARY JUDGMENT THAT HOOSIER HAS COMMITTED NO ANTITRUST VIOLATIONS, with brief in support, filed by Hoosier Racing Tire Corp. ("Hoosier") (Document No. 196 and Sealed Document No. 206), joined by co-Defendant Dirt Motor Sports, Inc. (Sealed Document No. 197-2); MEMORANDUM IN OPPOSITION filed by Plaintiffs (Sealed Document No. 228); and the REPLY BRIEF filed by Hoosier (Sealed Document No. 248);

• MOTION FOR SUMMARY JUDGMENT, with brief in support, filed by Dirt Motor Sports, Inc. d/b/a World Racing Group ("DMS") (Sealed Document No. 197 and Sealed Document No. 199); MEMORANDUM IN OPPOSITION filed by Plaintiffs (Sealed Document No. 227); and REPLY MEMORANDUM filed by DMS (Sealed Document No. 251); and • MOTION FOR PARTIAL SUMMARY JUDGMENT, with brief in support, filed by Plaintiffs (Sealed Document Nos. 202 and 204); BRIEF IN OPPOSITION filed by Hoosier (Sealed Document No. 223); and MEMORANDUM OF LAW IN OPPOSITION filed by DMS (Sealed Document No. 224).

The factual record has also been thoroughly developed via the CONCISE STATEMENT OF MATERIAL FACTS NOT IN DISPUTE filed by Hoosier (Sealed Document No. 207), PLAINTIFFS' RESPONSIVE CONCISE STATEMENT IN OPPOSITION TO MOTION FOR SUMMARY JUDGMENT FILED BY HOOSIER (Sealed Document No. 230), the CONCISE STATEMENT OF MATERIAL FACTS filed by DMS (Sealed Document No. 200), PLAINTIFFS' RESPONSIVE CONCISE STATEMENT OF MATERIAL FACTS IN OPPOSITION TO MOTION FOR SUMMARY JUDGMENT FILED BY DMS (Sealed Document No. 229); the RESPONSE TO PLAINTIFFS' "ADDITIONAL MATERIAL FACTS" filed by DMS (Sealed Document No. 250); the PLAINTIFFS' CONCISE STATEMENT OF MATERIAL FACTS IN SUPPORT OF THEIR MOTION FOR PARTIAL MOTION FOR SUMMARY JUDGMENT (Sealed Document No. 205); the RESPONSIVE CONCISE STATEMENT TO "PLAINTIFFS' CONCISE STATEMENT OF MATERIAL FACTS" filed by Hoosier (Sealed Document No. 221); PLAINTIFFS' REPLY TO HOOSIER'S RESPONSIVE CONCISE STATEMENT (Sealed Document No. 245); RESPONSE TO PLAINTIFFS' CONCISE STATEMENT OF MATERIAL FACTS filed by DMS (Sealed Document No. 225); and PLAINTIFFS' REPLY TO DMS' CONCISE STATEMENT OF MATERIAL FACTS (Sealed Document No. 244), as well as the voluminous exhibits submitted by all parties.

On July 14, 2009, the Court heard oral argument on the motions. For purposes of the oral argument and this Opinion only, the motions for summary judgment filed by Hoosier and DMS were consolidated. All parties were represented by counsel who presented and argued the issues skillfully and effectively. The matter is now ripe for disposition.

After a careful consideration of the motions, the filings in support and opposition thereto, the memoranda of the parties, the oral arguments of counsel, the relevant case law, and the record as a whole, the Motion for Summary Judgment filed by Hoosier will be granted, the Motion for Summary Judgment filed by DMS will be granted, and the Motion for Partial Summary Judgment filed by Plaintiffs will be denied as moot.

Standard of Review

Summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). Thus, the Court's task is not to resolve disputed issues of fact, but to determine whether there exist any factual issues to be tried. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-49, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The non-moving party must raise "more than a mere scintilla of evidence in its favor" in order to overcome a summary judgment motion. Williams v. Borough of West Chester, 891 F.2d 458, 460 (3d Cir.1989) (citing Liberty Lobby, 477 U.S. at 249, 106 S.Ct. 2505). Further, the non-moving party cannot rely on unsupported assertions, conclusory allegations, or mere suspicions in attempting to survive a summary judgment motion. Id. (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). Distilled to its essence, the summary judgment standard requires the non-moving party to create a "sufficient disagreement to require submission [of the evidence] to a jury." Liberty Lobby, 477 U.S. at 251-52, 106 S.Ct. 2505.

Several courts have noted that summary disposition of antitrust cases is difficult because of their inherent factual complexity and because motive and intent are paramount considerations. See e.g., Poller v. Columbia Broadcasting Sys., Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962). However, complexity does not mean that summary disposition is thereby precluded or even disfavored in antitrust law. Capital Imaging Assoc., P.C. v. Mohawk Valley Medical Assoc., Inc., 996 F.2d 537, 541 (2d Cir.1993). Rather, summary judgment may be particularly important in antitrust cases to prevent lengthy and drawn-out litigation that has a chilling effect on competitive market forces. Id. The present motions will be considered in light of these standards.

Procedural Background

Plaintiffs, Race Tires, Inc., a Division of Specialty Tires of America, Inc., and Specialty Tires of America Inc., initiated this lawsuit on September 25, 2007, by the filing of a five-count Complaint against only one defendant, Hoosier Racing Tire Corp. ("Hoosier"). Plaintiffs alleged Monopolization in violation of Section 2 of the Sherman Act (Count I), Conspiracy to Restrain Trade in violation of Section 1 of the Sherman Act (Count II), Attempted Monopolization in violation of Section 2 of the Sherman Act (Count III), Conspiracy to Monopolize (Count IV), and Request for A Declaratory Judgment pursuant to 28 U.S.C. § 2201 (Count V).

Less than a month later, on October 12, 2007, Plaintiffs filed an Amended Complaint in which they named Dirt Motor Sports, Inc. d/b/a World Racing Group ("DMS") as an additional defendant and included allegations specific to DMS.

On January 10, 2008, the Court entered a Case Management / Scheduling Order which established a deadline of May 30, 2008, 2008 WL 2264252, for amending of the pleadings. The parties engaged in discovery, which resulted in a steady stream of disputed discovery motions being filed with the Court. At last count, the Court had ruled on at least ten (10) discovery motions.

On March 13, 2008, Plaintiffs filed a Second Amended Complaint in which two "sister companies" of Specialty Tires of America, Inc., were added as co-plaintiffs: Specialty Tires of America (Pennsylvania), Inc., and Specialty Tires of America (Tennessee), LLC.

On May 30, 2008, the actual deadline for seeking leave to amend the pleadings, Plaintiffs moved to amend their complaint a third time to add a new count which alleged a tying arrangement illegal under Section 1 of the Sherman Act. The Court granted Plaintiffs' request for leave and a Third Amended Complaint was filed on June 23, 2008.

On November 19, 2008, well after the expiration of the deadline for amending pleadings, Plaintiffs once again sought leave to amend their Complaint to add a count alleging a concerted refusal to deal (group boycott). Not surprisingly, Defendants strongly opposed Plaintiffs' request to amend their Complaint a fourth time. On December 16, 2008, the Court denied the request to amend finding that Plaintiffs had failed to demonstrate good cause to amend and that it would be prejudicial to Defendants, fifteen months (15) months after the lawsuit was initiated and seven (7) months after the expiration of the deadline for seeking leave to amend, to add a new claim based on an additional legal theory, which would require additional written discovery and depositions. See Sealed Document No. 155.

Background

The history between the parties to this antitrust lawsuit is lengthy and contentious. The Court has noted on numerous occasions the considerable tension among the respective parties and their attorneys.

Plaintiffs, Race Tires America, Inc., a Division of Speciality Tires of America, Inc.; Speciality Tires of America, Inc.; Specialty Tires of America (Pennsylvania), Inc., and Speciality Tires of America (Tennessee), LLC (collectively referred to as Plaintiffs or "STA") and Hoosier compete in selling racing tires used in auto racing events sponsored or promoted by DMS, and other sanctioning bodies, race track owners, promoters, and tour series. Competition between STA and Hoosier includes vying for single tire rule contracts with sanctioning bodies.

STA alleges that Hoosier has greater than a 70% market share in the dirt oval race track market, and an even greater market share in the market for the sale of race tires in sanctioned dirt oval track races. Third Amended Complaint, at ¶ 18. STA contends that Hoosier acquired and maintained its monopoly power by entering into anticompetitive exclusive dealing agreements...