Syracuse Broadcasting Corporation v. Newhouse

• Decision Date: 04 October 1961
• Docket Number: No. 370,Docket 26775.,370
• Citation: 295 F.2d 269
• Parties: SYRACUSE BROADCASTING CORPORATION, Plaintiff-Appellant, v. Samuel I. NEWHOUSE, The Herald Company, The Post-Standard Company, and Central New York Broadcasting Corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Second Circuit

295 F.2d 269 (1961)

SYRACUSE BROADCASTING CORPORATION, Plaintiff-Appellant, v. Samuel I. NEWHOUSE, The Herald Company, The Post-Standard Company, and Central New York Broadcasting Corporation, Defendants-Appellees.

No. 370, Docket 26775.

United States Court of Appeals Second Circuit.

Argued May 2, 1961.

Decided October 4, 1961.

Joseph W. Burns, New York City (Austin, Burns, Appell & Smith, New York City; John P. Cuddahy, New York City, of counsel, on the brief; Laurence Sovik, Martin F. Kendrick, Syracuse, N. Y., of counsel, Smith & Sovik, Syracuse, N. Y.), for plaintiff-appellant.

Tracy H. Ferguson, Syracuse, N. Y. Gerald H. Weinstein, Syracuse, N. Y., of counsel; Bond, Schoeneck & King, Syracuse, N. Y., on the brief), for defendants-appellees.

Before LUMBARD, Chief Judge, MOORE, Circuit Judge, and STEEL,^* District Judge.

LEONARD P. MOORE, Circuit Judge.

In November 1952 plaintiff brought this action for treble damages based on various provisions of the Sherman and Clayton Acts. After two appeals to this court (1956, 236 F.2d 522; 1959, 271 F.2d 910), the dismissal of another appeal for lack of jurisdiction (June 3, 1957), a denial of a motion to this court for clarification (September 21, 1960), the denial of a motion in the nature of a writ of mandamus (October 6, 1960), and the compilation of a more than 7,000 page pre-trial record, the case finally went to trial on November 28, 1960. Plaintiff called one witness and then rested. Defendants' motion for a dismissal was granted, and from the judgment entered thereon, plaintiff appeals.

Plaintiff Syracuse Broadcasting Corporation (WNDR) and defendant Central New York Broadcasting Corporation (WSYR) are radio broadcasting corporations located in Syracuse, New York. The other two corporate defendants publish the sole daily and Sunday newspapers in that city. "The defendant Post-Standard Company is wholly owned by the defendant Herald Company, the majority interest in which, in turn, is owned by the individual defendant Samuel I. Newhouse, who also controls the defendant broadcasting company (WSYR and WSYR-TV)" (236 F.2d at page 524).

Thus, after almost nine years of bickering over pre-trial procedures, no real trial has as yet been held. An appellate court cannot act and should not have to act as a pre-trial court. Nor is it its function to draft a blueprint for the trial showing in detail each relevant evidentiary item and the proper or most strategic order of proof. On the two previous appeals an attempt was made by this court (apparently unsuccessfully) to point out the issues which, if there were any supporting proof, might be litigated. Thus on the first appeal the court, on a record "far too confused and cumbersome to warrant an affirmance of the summary judgment dismissing plaintiff's Sherman Act claim" and with misgivings as to whether there was any substance to plaintiff's charges relative to the spreading of false rumors by defendants concerning plaintiff, nevertheless, thought that "the interests of justice require a trial of this particular narrow issue, that is to say the charge of conspiracy to restrain trade to plaintiff's damage by the use of the unit rate for advertising in the two newspapers, the circulation of false rumors about plaintiff, the refusal to publish in the newspapers items favorable to the plaintiff, and the giving of discriminatory advantages to WSYR" (236 F.2d 522, 526). Dismissal of the charge under the Clayton Act (15 U.S.C.A. § 13) for failure to state a cause of action was reversed because "a conspiracy is not a necessary element of a violation of § 13" (at page 527). The court hoped (again in vain) that "the record after trial will give us a better basis for resolving these important issues than the confusing and wholly unorganized mass of affidavits and depositions now before us" (at page 527). So wrote the court in August 1956.

In November 1956 defendants moved for a pre-trial order for further information which resulted in a pre-trial order dated February 12, 1957. Thereafter plaintiff submitted a most comprehensive (29 printed pages) compliance memorandum (April 3, 1957) setting forth names of persons involved, dates, places, subject matter of conversations and letters and other exhibits. Illustrative are a list of 32 itemized paragraphs stating acts committed in furtherance of defendants' wrongful concert of action and a list of 21 instances of business lost because of the circulation of allegedly false rumors.

On July 27, 1957 the trial court entered a preclusion order which came to this court for review by virtue of an appeal from an order in January 1958 dismissing the complaint. In the opinion on that appeal the court commented upon its previous decision and its conception of the scope of the remaining issues saying that "plaintiff was not entitled to go to trial on its monopoly charge under Section 2 of the Sherman Act, 15 U.S.C.A. § 2, its complaint of mergers, and interlocking directorates in violation of the Clayton Act, 15 U.S.C.A. §§ 18 and 19, in its allegation that defendant newspapers refused to accept advertising unless WSYR was also patronized" (271 F.2d 910 913). The dismissal of the action was reversed and the preclusion order considered at some length in the opinion (pp. 915-917).

Under "Volume of Interstate Commerce" Items I(e) and (g) the court suggested irrelevance of (e) and preclusion of (g) "the extent of plaintiff's participation in this commerce." However, the privilege was given to plaintiff of "at any time introducing whatever evidence might become available to it on this point (e)."

Item III(a) related to "Circulation of false statements among plaintiff's advertisers." This court's direction was clear enough — evidence as to statements in newspaper articles was not precluded; oral rumors (statements) were precluded.

Item IV(b) dealt with "Refusal to publish news items favorable to plaintiff." The news items listed in Exhibits N, I and K were not precluded; those in Exhibit R were precluded.

Items V(b) (c) (d) and (e) related to "Discriminatory advantages given WSYR." All evidence was precluded except "the issues of free advertising," "preferred page position" and "secret rebates."

Item VI(a) "Price discrimination." This court held that plaintiff could not object to the preclusion of evidence of price discrimination except as it "relates to the free advertising alleged to have been given WSYR by the two defendant newspapers" (271 F.2d 910, 917).

The dismissal was reversed and "the case remanded for further proceedings not inconsistent with this opinion." Upon his own initiative, the trial judge prepared a "status memorandum" (December 7, 1959) in which was incorporated the judge's conception of the effect on the trial of this court's decision. A further pre-trial hearing was held on March 14, 1960 and a second conference scheduled for June 29, 1960. On June 27, 1960 plaintiff filed an affidavit of bias and prejudice against the trial judge. The affidavit was held to be insufficient. Further pre-trial hearings were conducted on June 30, August 3, September 13, September 20, and October 25, 1960. Pretrial orders were made on July 19, August 5, August 19, September 26, October 28, and November 18. Plaintiff made adequate compliance thus disclosing that it believed that it had a mass of evidence in its possession, under its control or available by subpoena in substantiation of its case.

Finally on November 28, 1960, almost on the anniversary of the filing of the complaint eight years previously, a jury was impanelled. Plaintiff's proposed proof in great detail (ten printed pages of the record) was set before the jury during plaintiff's opening statement. However, after calling one witness who testified briefly, plaintiff claimed that because of the preclusion of certain evidentiary items that it could not proceed. The trial judge had no other alternative than to grant defendant's motion to dismiss the complaint. Thus for the third time under the guise of an appeal from a dismissal, this court has to review the propriety of pre-trial preclusionary orders which are non-appealable before final judgment.

On this appeal plaintiff contends that its inability to proceed further when on trial resulted from two pre-trial orders issued by the trial judge on August 19 and September 26, 1960. The August 19 order provides that:

"Newspaper articles, advertisement, statements or publicity which plaintiff will offer as part of its affirmative case will be prepared as separate exhibits identified by the date, page and column of the newspaper in which it is published. The same shall be listed in the order in which they will be offered and copies of said list and of the exhibits shall be delivered to defendants\' counsel on or before September 8, 1960."

When plaintiff failed to comply with this order, the judge below, on September 26, 1960, ordered "that plaintiff is precluded from offering or introducing into evidence any newspaper articles, advertisements, statement or publicity, * * *"

According to plaintiff, the crux of its case is contained in issues of defendants' newspapers published between November 1947 and May 1953, a total of over 3,500 publications. These newspapers — presently available either in their original form or on microfilm — plaintiff claims will form part of its proof that defendant newspapers authorized WSYR to furnish its advertisers free newspaper advertising and publicity as an inducement to advertise over WSYR, that defendant newspapers gave free advertising to WSYR, and that they gave disproportionately favorable publicity to WSYR and unfavorable publicity to WNDR. Plaintiff also claims that the August 19 order, in effect, prevented it from going to trial since it imposed the impossible burden of making copies of all articles to be introduced as exhibits.

Insofar as they forced plaintiff to make and submit copies of each article (already in defendants'...