West v. Whitney-Fidalgo Seafoods, Inc.

Decision Date08 May 1981
Docket NumberNo. 4747,WHITNEY-FIDALGO,4747
Parties1981-1 Trade Cases P 64,045 Julia E. WEST and Peter W. Wilska, Appellants, v.SEAFOODS, INC., Appellee.
CourtAlaska Supreme Court

Russell E. Arnett, Anchorage, for appellants.

Jan Samuel Ostrovsky, Ron Birch, Birch, Horton, Bittner, Monroe, Pestinger & Anderson, Anchorage, for appellee.

Before RABINOWITZ, C. J., CONNOR, BURKE and MATTHEWS, JJ., and DIMOND, Senior Justice.

OPINION

MATTHEWS, Justice.

The appellant, Julia West, was the owner of a fish scow which she used to store salmon caught in the vicinity of her set net site in Trading Bay on the western shore of Cook Inlet. West's husband had purchased the scow from appellee, Whitney-Fidalgo Seafoods, Inc., in 1972. Since then it had been stored in the off season at Whitney-Fidalgo's dock in Anchorage.

Prior to 1977, West had sold all the salmon that she caught to Whitney-Fidalgo. In 1977 she decided to sell her catch to Osmar's Ocean Specialties, Inc., and made an oral contract with Osmar's to use her scow as a delivery point for fish from other fishermen who were also selling to Osmar's. On June 29, 1977, a cannery tender from Osmar's went to Whitney-Fidalgo's dock to tow West's scow to Trading Bay. The manager of Whitney-Fidalgo's Anchorage plant refused to release the scow, and subsequently presented West with a bill for $9,200.00, telling her that in order for her to regain possession she would have to pay that sum. 1 This was the first knowledge West had of Whitney-Fidalgo's claim that she owned it money in connection with the scow.

On July 8, 1977, West filed suit seeking damages and return of the scow. On July 22, 1977, after much of the salmon fishing season was over Whitney-Fidalgo reduced its claim to $1,959.10. 2 In September, 1977, an amended complaint was filed in which West's fishing partners, Peter W. Wilska and Robert B. Wright, were added as plaintiffs.

The amended complaint contained counts brought under the Alaska Anti-Trust Act, AS 45.52.010 et seq., claims of wrongful interference with West's contract with Osmar's Ocean Specialties, Inc., and negligence and recklessness. The amended complaint sought compensatory damages, treble damages, punitive damages, and a return of the scow.

Whitney-Fidalgo's answer alleged as an affirmative defense that it was privileged to hold the scow under a personal property improvement lien pursuant to AS 34.35.175 and had the right to continue to hold the scow until its charges were paid. In addition it counterclaimed for the amount of its charges, $1,959.10.

After considerable discovery, Whitney-Fidalgo moved for judgment on the pleadings, and in the alternative, for partial summary judgment as to plaintiffs' anti-trust claims. These motions were granted by Judge Kalamarides.

Subsequently, the case was presented to a jury as one for wrongful deprivation of possession of personal property and on defendant's counterclaim. The jury found for Whitney-Fidalgo, defendant, awarding it the sum of $1,959.10.

On appeal, appellants claim numerous errors.

I

THE ANTI-TRUST CLAIM

The amended complaint charged that

defendant has in June and July 1977, and continues to wilfully conspire to restrain trade and commerce and to monopolize, or attempt to monopolize, or to combine or to conspire with another person to monopolize trade or commerce, by wrongfully depriving plaintiffs of possession and the right to use a certain fish scow owned by plaintiff, Julia E. West, for the reason that said barge would be used in competition with defendant.

This language charged violations of AS 45.52.010 and .020 which provide: 3

45.52.010. Combinations in restraint of trade unlawful. Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce is unlawful.

AS 45.52.020. Monopolies and attempted monopolies unlawful. It is unlawful for a person to monopolize, or attempt to monopolize, or combine or conspire with another person to monopolize any part of trade or commerce.

Plaintiffs' claim for treble damages was authorized by AS 45.52.110(a) which provides:

Suits by persons injured. (a) A person who is injured in his business or property by a violation of §§ 10, 20, 30, 40 or 50 of this chapter, or a person so injured because he refuses to accede to a proposal for an arrangement which, if consummated, would be a violation of §§ 10, 20, 30, 40 or 50 of this chapter, may bring a civil action (1) for damages sustained by him, and if the judgment is for the plaintiff and the trier of fact finds that the defendant's conduct was wilful, the plaintiff shall be awarded threefold the amount of damages sustained by him, plus the costs of the suit, including reasonable attorney fees; ...

As previously indicated, Whitney-Fidalgo moved for judgment on the pleadings and, in the alternative, for partial summary judgment as to the claims based on AS 45.52.010 and AS 45.52.020. Plaintiffs consented to summary judgment as to the allegations made under AS 45.52.010, and their claim based on that section was eliminated from the case.

Whitney-Fidalgo, in its motion for judgment on the pleadings concerning the AS 45.52.020 allegations of monopolization and attempt to monopolize, contended that the claim was deficient because it contained no allegation of the relevant market which Whitney-Fidalgo had allegedly either monopolized or attempted to monopolize, and no allegation that the attempt charged had a "dangerous probability of success" in bringing about a monopoly.

In its alternative motion for summary judgment, Whitney-Fidalgo argued that the entire Cook Inlet should be considered the relevant market and that it did not have a monopoly in that market. Whitney-Fidalgo noted that it "is a dominant buyer because it has the only cannery in Anchorage, but it has not controlled prices or excluded competition." According to Whitney-Fidalgo, for the 1976 salmon season there were eighteen purchasers of salmon in Cook Inlet; it purchased approximately twenty-one percent of the catch that year. There were twenty purchasers in 1977, and it purchased approximately thirty percent of that year's catch. Thus, Whitney-Fidalgo argued that it was undisputed that it did not have a monopoly in Cook Inlet, and further asserted that its market share for those years was "not sufficient to show a dangerous probability of success in an alleged attempt to monopolize the Cook Inlet area salmon market."

Plaintiffs combined their response to Whitney-Fidalgo's motions. Germane to the motion for judgment on the pleadings, they argued that an allegation of the relevant economic market and an allegation that there existed a dangerous probability of monopolization of such a market were not essential to an attempt to monopolize claim under section .020. With respect to the summary judgment motion plaintiffs argued that the relevant market was the Upper Cook Inlet area and that defendant's market power there was sufficiently shown by the fact that it "has the only salmon cannery in the Upper Cook Inlet."

The plaintiffs in their statement of genuine issues suggested that the following acts of Whitney-Fidalgo, in addition to holding the scow, provided evidence of an attempt to monopolize the salmon market in the Upper Cook Inlet: 1) providing in a draft of a written contract with the Cook Inlet Fishermen's Association a provision that all salmon caught by Association members would be sold exclusively to Whitney-Fidalgo; 2) inserting in the initial contract of sale for the scow with Julia West's husband, Martin, a requirement that Martin fish for the company for four years; 3) threatening representatives of the Cook Inlet Fishermen's Association that if any fisherman did not sell all his catch to Whitney-Fidalgo, it would remove its fish scow from the area fished by the Cook Inlet Fishermen's Association members and purchase no fish from them. These allegations were supported by sworn testimony in the record.

The trial court largely accepted Whitney-Fidalgo's argument concerning the motion for judgment on the pleadings. The court concluded:

Based upon plaintiffs' failure to properly allege either that defendant had the specific market power to come dangerously close to succeeding in their attempts to monopolize or that defendant's attempted monopolization was with respect to a specified and relevant market area, I find that plaintiffs' first cause of action is insufficient to maintain a claim under AS 45.52.020.

In the alternative, the court concluded as a matter of fact that the relevant market was not Upper Cook Inlet since that market area was not "sufficiently distinct in commercial reality to permit defendant to exclude competition and control prices." The court noted that "the existence of alternative buyers further down the Inlet would have negated the defendant's ability to exclude competition or control prices within the defined area, thus relieving them from liability...." The court thus dismissed all of the plaintiffs' anti-trust claims.

On appeal West and her partners do not claim that error was committed in dismissing their monopolization claims. They do contend, however, that their attempt and conspiracy to monopolize claims should have been presented at trial. Before the superior court, however, they did not argue that they had a valid conspiracy to monopolize claim, and thus they have waived the right to make that assertion here. 4 The upshot of this is that the only anti-trust theory that is presented to us is that of attempt to monopolize.

The legislative history of the Alaska Anti-Trust Act indicates that section .020 is based on section 2 of the Sherman Anti-Trust Act. 5 The legislature intended that Alaska courts would look to Sherman Act cases in construing the Act. 6

There is a distinct disagreement among the federal circuits as to whether proof of an economic market and proof of a dangerous probability of monopolization of such a...

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