Taylor Drug Stores, Inc. v. Associated Dry Goods Corp.

• Decision Date: 12 August 1977
• Docket Number: No. 76-1486,76-1486
• Parties: 1977-2 Trade Cases 61,579 TAYLOR DRUG STORES, INC., Plaintiff-Appellant, v. ASSOCIATED DRY GOODS CORPORATION et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 211

560 F.2d 211

1977-2 Trade Cases 61,579

TAYLOR DRUG STORES, INC., Plaintiff-Appellant, v. ASSOCIATED DRY GOODS CORPORATION et al., Defendants-Appellees.

No. 76-1486.

United States Court of Appeals Sixth Circuit.

Argued June 23, 1977.

Decided and Filed Aug. 12, 1977.

Charles G. Middleton, III, Albert F. Reutlinger, Middleton, Reutlinger & Baird, Louisville, Ky., for plaintiff-appellant.

John E. Tarrant, Bert T. Combs, Edwin S. Hopson, Louisville, Ky., for Associated Dry Goods.

Stuart A. Handmaker, K. S. Handmaker, Louisville, Ky., for Ben Snyder's Inc.

Kenneth L. Anderson, Louisville, Ky., for Sears & Roebuck Co.

Before EDWARDS and PECK, Circuit Judges, and WEINMAN, ^* Senior District Judge.

PER CURIAM.

Appellant Taylor Drug Stores, Inc., appeals from summary judgment entered for all defendants in a civil action which alleged violation of the Sherman and Clayton Antitrust Acts, 15 U.S.C. § 1 (1970), as amended (Supp. V, 1975); id. § 15 (1970). In 1969 at the beginning of the events which led to this litigation, appellant was a general drug company which operated approximately 20 drug stores in Jefferson County, Kentucky, and followed the practice of staying open on Sundays. Defendants-appellees, Retail Merchants Association, Associated Dry Goods Corporation, Ben Snyder, Inc., and Sears, Roebuck Company, decided to file a suit in the Jefferson County Circuit Court to keep plaintiff and others from continuing to do business on Sunday as to those portions of its sales which were non-necessities of life to which the Kentucky Sunday Closing Law applied. Ky.Rev.Stat. § 436.160.

After trial on the complaint filed by our current defendants, the Jefferson County Circuit Court issued first a temporary injunction (which was affirmed on appeal to the Kentucky Court of Appeals) and then a permanent injunction. The appeal of the permanent injunction was voluntarily dismissed by appellants, including Taylor Drug Stores, and the injunction was dissolved by agreement, when the Kentucky General Assembly amended the Sunday closing law mooting the issue. Act of February 25, 1972, ch. 18, (1972) Ky. Acts 44, amending Ky.Rev.Stat. § 436.160 (codified at Ky.Rev.Stat. §§ 436.160, .165).

Claiming damages represented by loss of profits when its business was diminished for three years while it was enjoined from Sunday operations, plaintiff Taylor Drug Stores filed the instant antitrust suit alleging that defendants had conspired to bring the Jefferson County injunction suit with the real motive of restraining Taylor Drug Stores, Inc.'s competition. The suit alleged that at the time of the Jefferson County Circuit Court litigation brought by defendants seeking to enforce the Kentucky Sunday Closing Law against plaintiff, some of the present defendants were themselves operating across the river in Indiana, in violation of the Indiana Sunday Closing Law.

On the filing of this antitrust complaint, and after the conducting of extensive discovery, motions for summary judgment were filed by defendants-appellees. In a careful opinion, the District Court granted defendants-appellees' motion for summary judgment as to Count II of the complaint. ¹ While relying upon the general exception to the antitrust laws first defined in Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961), and United Mine Workers v. Pennington, 381 U.S. 657, 669-72, 85 S.Ct. 1585, 14 L.Ed.2d 626 (1965), he also recognized and discussed the holding of the Supreme Court in California Motor Transport Co. v. Trucking Unlimited, 404 U.S. 508, 92 S.Ct. 609, 30 L.Ed.2d 642 (1972). In the latter case the Supreme Court held that concerted action by petitioners to institute both state and federal litigation to resist and defeat applications by respondents to acquire trucking operating rights could represent antitrust violations regardless of the general right of all citizens to have access to the courts. In California Motor Transport the Court said:

A combination of entrepreneurs to harass and deter their competitors from having "free and unlimited access" to the agencies and courts, to defeat that right by massive, concerted, and purposeful activities of the group are ways of building up one empire and destroying another.

Id. at 515, 92 S.Ct. at 614.

The District Court noted, however, that in our instant case the actions of the present defendants-appellees in the 1969 litigation represented "one lawsuit in which they were successful at all levels (where they sought) the enforcement of a statute which had been previously declared Constitutional by the highest court of Kentucky."

We agree with plaintiff-appellant that summary judgment is rarely an appropriate response to antitrust litigation, since such litigation so frequently turns upon disputed issues of fact. In our instant case, however, we find the following colloquy between one of the counsel for defendants-appellees and Mr. William Hayward Harrison, the President of plaintiff Taylor Drug Stores, Inc., plaintiff-appellant in this cause:

481. Mr. Harrison, was there do you have any facts or knowledge of any steps taken by any of the defendants in this case to keep you from buying merchandise or keep you from getting, when you wanted it, any...