STEWART AVIATION COMPANY v. PIPER AIRCRAFT CORPORATION, Civ. A. No. 73-717.

• Decision Date: 22 March 1974
• Docket Number: Civ. A. No. 73-717.
• Citation: 372 F. Supp. 876
• Parties: STEWART AVIATION COMPANY, a corporation, Plaintiff, v. PIPER AIRCRAFT CORPORATION, a corporation, Defendant.
• Court: U.S. District Court — Middle District of Pennsylvania

372 F. Supp. 876

STEWART AVIATION COMPANY, a corporation, Plaintiff, v. PIPER AIRCRAFT CORPORATION, a corporation, Defendant.

Civ. A. No. 73-717.

United States District Court, M. D. Pennsylvania.

March 22, 1974.

Harold R. Schmidt, H. Yale Gutnick, J. D. Glasser, Rose, Schmidt & Dixon, Pittsburgh, Pa., John C. Youngman, Sr., Candor, Youngman, Gibson & Gault, Williamsport, Pa., for plaintiff.

Paul G. Pennoyer, Jr., Chadbourne, Park, Whiteside & Wolff, New York City, Lester L. Greevy, Jr., Greevy, Knittle & Mitchell, Williamsport, Pa., for defendant.

OPINION

MUIR, District Judge.

This civil treble-damage antitrust action was brought against Piper Aircraft Corporation by one of its former distributors, Stewart Aviation Company, on February 12, 1968, in the United States District Court for the Northern District of West Virginia. It was transferred to the Middle District of Pennsylvania on December 17, 1973.

Two weeks before the trial, Defendant moved for partial summary judgment based upon the statute of limitations. That motion is the subject of this opinion.

Stewart alleges that Piper violated the Sherman Antitrust Act¹ by conspiring with the distributors of its product, including Stewart, to grant each distributor an exclusive geographical territory outside of which the distributor was prohibited from selling Piper's products, but within which the distributor was free to sell Piper products without fear of competition from Piper's other distributors. Stewart also alleges that Stewart did not respect the territorial agreement and was terminated by reason of that fact as a Piper distributor on June 30, 1965. It is undisputed that prior to 1963 Piper's distributor contracts did have a territorial restriction on all distributors, but Piper contends that the agreement was not enforced.

The Antitrust laws provide for a four year statute of limitations.² Piper seeks to prevent Stewart from attempting to prove any damages for a period earlier than February 12, 1964. Stewart, citing Zenith Radio Corp. v. Hazeltine Research, 401 U.S. 321, 91 S.Ct. 795, 28 L. Ed.2d 77 (1971), maintains that since its pre-1964 damages were uncertain and speculative until 1964 at the earliest, it should be allowed to prove its pre-1964 damages.

The general rule in antitrust actions is that a cause of action accrues and the statute of limitations begins to run when a Defendant commits an act that injures a plaintiff's business. Zenith Radio Corp. at p. 338, 91 S.Ct. 795. It is also the rule that in a suit which includes recovery for future damages, a plaintiff will not be allowed to recover for future damages that are unascertainable. Zenith Radio Corp. at p. 339, 91 S.Ct. 795. Reading these two principles together it is entirely possible that a defendant could engage in actions violative of the antitrust laws where the resultant damages may not become ascertainable for ten years, but at the expiration of that 10-year period a plaintiff, were he then to file suit, could not recover because the anti-competitive conduct occurred more than four years before such hypothetical suit was filed. With this possible inequity in mind, the Zenith court held that illegal anti-competitive conduct which occurs more than four years prior to the initiation of a lawsuit may be the basis of recovery in damages which were caused during the four years immediately prior to the filing of that suit if, at the time of the original antitrust violation, future damages would have been unascertainable. See Poster Exchange, Inc. v. National Screen Service Corp., 456 F.2d 662, 667-668 (5th Cir. 1972) and Ansul Company v. Uniroyal, Inc., 448 F.2d 872, 885 (2d Cir. 1971).

Stewart may recover those damages which occurred after February 11, 1964 as a result of Piper's antitrust violations taking place before February 12, 1964, if at that earlier time future damages would have been unascertainable. Whether these alleged damages were susceptible of being ascertained is an issue upon which testimony must be...