Opposition Brief — Clamp-All Corp. v. Cast Iron Soil Pipe Institute

No. 88-725

In the

Supreme Court of the United States

OCTOBER TERM, 1988

CLAMP-ALL CORPORATION,

PETITIONER,

We

CAST IRON SOIL PIPE INSTITUTE, et at..

RESPONDENTS.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

Respondents’ Brief in Opposition to

Petition for a Writ of Certiorari

JOHN J. CurTIN, JR.*

WILLIAM G. SOUTHARD

Jopy E. FoRCHHEIMER

BINGHAM, DANA & GOULD

150 Federal Street

Boston, Massachusetts 02110

(617) 951-8000

Counsel for Cast Iron Soil

Pipe Institute

*Counsel of Record

(List of Counsel Continued on Inside Cover)

BATEMAN & SLADE. INC

BOSTON. MASSACHUSETTS

JOHN M. HARRINGTON, Jr.

THOMAS H. HANNIGAN, Jr.

Ropes & GRAY

225 Franklin Street

Boston, Massachusetts 02110

(617) 423-6100

Counsel for The Eastern

Foundry Company

ALAN R. HOFFMAN

LYNCH, BREWER, HOFFMAN

& SANDS

101 Federal Street

Boston, Massachusetts 02110

(617) 951-0800

Counsel for Anaheim

Foundry Company

Mark W. PEARLSTEIN

GOODWIN, PROCTER & HOAR

Exchange Place

Boston, Massachusetts 02109

(617) 570-1000

Counsel for Jones Manufacturing

Company, Inc

HENRY P. SAILER

ELIZABETH FOOTE

COVINGTON & BURLING

1201 Pennsylvania Avenue

Washington, D.C. 20004

(202) 662-6000

Counsel for Charlotte Pipe

& Foundry Company

JOHN F. TENER

THEODORE TUCCI

ROBINSON & COLE

One Commercial Plaza

Hartford, Connecticut 06103

(203) 275-8200

Counsel for United States Pipe

and Foundry Company, Inc.

Table of Contents

Argument

PETITIONER’S ARGUMENTS RELATE

ONLY TO THE SUFFICIENCY OF ITS TRIAL

EVIDENCE, A MATTER ALREADY EX-

AMINED AT LENGTH AND NOT WORTHY

OF CERTIORARI IN THIS “HIGHLY FACT-

BASED” CASE

A. THE First Circutr ADOPTED No “PRE-

SUMPTION” REGARDING PRIVATE PRODUCT

STANDARDS

B. PETITIONER’s CONTENTIONS WERE FULLY

AND PROPERLY CONSIDERED BELOW; FurR-

THER REVIEW IS UNWARRANTED

C. THE Courts BELOW WERE CORRECT IN

RULING THAT PETITIONER’S EVIDENCE

Was INSUFFICIENT ;

1. The ASSE Proceedings

2. Respendents’ Advertising

3. Market Power

Conclusion

Appendix A

STATEMENT REQUIRED BY RULE 28.1

ii

Table of Authorities

CASES

Allied Tube & Conduit Corp. v. Indian Head, Inc., 486

U.S. , 108 S. Ct. 1931 (1988)

- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986)

Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 336

U.S. 271 (1949)

Houston Oil Co. of Texas v. Goodrich, 245 U.S. 440

(1918)

Layne & Bowler Corp. v. Western Well Works, Inc.,

261 U.S. 387 (1923)

Rice v. Sioux City Memorial Park Cemetery, Inc., 349

U.S. 70 (1955)

5n

No. 88-725

In the

Supreme Court of the United States

OCTOBER TERM, 1988

CLAMP-ALL CORPORATION,

PETITIONER,

V.

CAST IRON SOIL PIPE INSTITUTE, ET AL.,

RESPONDENTS.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

Respondents’ Brief in Opposition to

Petition for a Writ of Certiorari

Respondents the Cast Iron Soil Pipe Institute (“CISPI’),

Anaheim Foundry Company, Charlotte Pipe & Foundry Com-

pany, The Eastern Foundry Company, Jones Manufacturing

Company, Inc., and United States Pipe and Foundry Company,

Inc. oppose the petition of Clamp-All Corporation (“Clamp-

All”) for a writ of certiorari to review the judgment of the

United States Court of Appeals for the First Circuit in this

case. In opposition to Clamp-All’s petition, respondents jointly

file this brief.

2

Argument

PETITIONER’S ARGUMENTS RELATE ONLY

TO THE SUFFICIENCY OF ITS TRIAL EVI-

DENCE, A MATTER ALREADY EXAMINED AT

LENGTH AND NOT WORTHY OF CERTIORARI

IN THIS “HIGHLY FACT-BASED” CASE

Petitioner seeks a grant of certiorari to obtain further review

of what petitioner asserts are two aspects of the rulings below:

(1) a “presumption” the Court of Appeals allegedly adopted

with respect to the antitrust implications of a private product

standard, and (2) the determination that petitioner’s trial evi-

dence in this “highly fact-based” case was insufficient to sur-

vive a motion for a directed verdict at the close of petitioner’s

case, Petitioner’s Appendix (“Pet. App.”) 2a. As respondents

detail below, the “presumption” that petitioner finds in the

First Circuit’s opinion is a creature of petitioner’s own misread-

ing of that opinion. The only ruling on this point, by both the

trial court and the First Circuit, was that petitioner's evidence,

examined in accordance with hornbook antitrust standards,

was simply insufficient.

Once petitioner’s first argument is properly framed, it is

apparent that both issues raised by petitioner relate to nothing

more than the sufficiency of the evidence. The writ of certiorari

exists to resolve substantial federal and constitutional ques-

tions, not to afford a petitioner yet a third opportunity to

convince a court that somewhere in the trial record can be

found sufficient evidence on some contention to warrant con-

sideration of the issue by a jury. The petition should be denied

and this protracted, burdensome proceeding brought to an end.

3

A. THE First CircUIT ADOPTED No “PRESUMPTION” RE-

GARDING PRIVATE PRODUCT STANDARDS

In an effort to raise an issue other than the sufficiency of

the evidence, petitioner asserts that the First Circuit adopted

a “new rule of per se legality for private standards that exclude

competing products.” Petition at 8. A review of the First Cir-

cuit’s opinion reveals that it adopted no such rule. To the

contrary, the court simply applied orthodox rule of reason

analysis to the evidence submitted at trial concerning a private

standard established by CISPI, CISPI Designation: 310. The

court stated: (i) that “ ‘legitimate’ standard-setting activity”

has competitive benefits; (ii) that a plaintiff is entitled to adduce

evidence that “the standard setting at issue serves no legitimate

purpose, or . . . is unnecessarily harmful” and (iii) that

petitioner submitted insufficient evidence to raise a triable issue

concerning its assertions. Pet. App. 15a-16a. Stated simply,

petitioner’s claim failed at trial, not because some novel liabil-

ity or evidentiary standard was applied, but because petitioner

failed to back up its allegations with cognizable evidence.

Moreover, far from applying a per se rule or “presumption,”

aS petitioner contends, Petition at 7, 8, the court carefully

analyzed the evidence in the record, including the following:

(a) The private standard at issue was created, not by a

“general certifying organization,” Pet. App. 16a, but by a

private trade association, CISPI, in order to establish a generic

denomination which would allow purchasers “to determine

whether a particular coupling is, in fact, (generically consid-

ered) a CISPI coupling.” Pet. App. 14a.

(b) The standard, on its face, advises users of the existence

of competing products and disavows any commentary on such

competing products. Pet. App. 14a, !6a.

(c) There was “no testimony” (emphasis added) that buyers

of the product, “builders, plumbers or contractors —. reason-

4

ably sophisticated users,” Pet. App. 16a, were in any respect

misled into thinking that the respondents’ trade association

was a “general certifying organization” whose failure to certify

petitioner's “quite different product” reflected adversely or

otherwise on that product. Pet. App. 16a.

In sum, it is petitioner that, having no evidence to support

its claim, is seeking the adoption of a per se rule. The ruling

of the First Circuit creates no new issue of law for this Court

to review. Petitioner’s first argument, like its second conten-

tion, does no more than invite this Court to review and rede-

termine the sufficiency of the evidence.

B. PETITIONER'S CONTENTIONS WERE FULLY AND PROP-

ERLY CONSIDERED BELOW; FURTHER REVIEW Is UN-

WARRANTED

Petitioner’s “fourteen volumes of record,” Pet. App. 22a,

have now been reviewed, in detail, by two courts. The opinions

below are noteworthy for their patient and painstaking efforts

to review the facts in support of each of petitioner’s scattershot

allegations and for their thorcugh explanations as to how, for

each allegation, petitioner’s proof fell short.

The District Court, Zobel, J., presided over thirteen days

of jury trial of petitioner's case. Through the course of the

trial, the District Court became intimately familiar with the

evidence submitted by petitioner and the inferences that

petitioner argued could reasonably be drawn therefrom. The

District Court’s opinion establishes that it employed the proper

standards for ruling on the motion for directed verdict, Pet.

App. 3la-33a, and that its ruling was well-reasoned, fully

grounded in the record, and correct.

The Court of Appeals then afforded petitioner a second

comprehensive review of its facts and contentions. Contrary

to the conclusory assertions in the Petition, the appellate court

5

employed the proper legal standard, “‘assum{ing] a set of facts

as favorable to Clamp-All, in respect to each charge, as the

evidence will reasonably permit.” Pet. App. 4a. Its analysis

of the facts, which reflects an extensive review of the record,

reaches the only possible conclusion — that sufficient evidence

of an antitrust violation was not submitted.

Absent exceptional circumstances, this Court will not review

lower court rulings on the sufficiency of the evidence. Houston

Oil Co. of Texas v. Goodrich, 245 U.S. 440, 441 (1918). The

sufficiency of the evidence adduced by petitioner is a subject

of interest only to the litigants herein, and thus does not present

a question worthy of consideration by this Court. See Rice v.

Sioux City Memorial Park Cemetery, Inc., 349 U.S. 70, 79

& n.2 (1955); Layne & Bowler Corp. v. Western Well Works,

Inc., 261 U.S. 387, 393 (1923). Moreover, this Court has

consistently declined to undertake what is essentially a fact-

finding or fact evaluation mission where two courts below, in

accordance with the proper legal standards, have reached con-

current conclusions. Graver Tank & Mfg. Co. v. Linde Air

Prods. Co., 336 U.S. 271, 275 (1949).' Because petitioner's

claims have been fully aired in prior proceedings, and in light

of the well-established and prudent practice of this Court not

to grant further review to insular controversies over the suffi-

ciency of the evidence, no writ of certiorari sheuld issue.’

‘At various points, petitioner asserts that the jury was not permitted to hear

certain evidence. Petition at 4, 11. Petitioner has confused the issue of admis-

sibility of evidence with the issue of sufficiency of evidence. The lower courts

ruled that the admitted evidence, taken together, simply did not afford a basis

upon which a reasonable jury could find an antitrust violation, and that entry

of a directed verdict was therefore appropriate. See Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 250-52 (1986).

* Because respondents do not view this Court as being an appropriate forum

for a point-by-point reargument on the significance of the facts heard below,

respondents do not attempt herein to reply to each factual assertion contained

in the Petition. Respondents’ failure to quarrel herein with any particular

6

C. THe Courts BELOW WERE CORRECT IN RULING THAT

PETITIONER'S EVIDENCE WAS INSUFFICIENT

Outside of the ruling as to the competitive significance of

CISPI Designation: 310, which is addressed above, petitioner

challenges the lower court rulings as to the sufficiency of the

evidence on three issues: (1) the American Society of Sanitary

Engineers (“ASSE”) proceedings; (2) respondents’ advertising;

and (3) market power. As to each issue, it is plain that petitioner

has either misunderstood, misconstrued or simply ignored the

opinions and evidence below.

1. The ASSE Proceedings

As set forth in the opinions below, the ASSE, a standard-set-

ting organization in the plumbing field, formed a subcommittee

to write a standard for a product, the hubless coupling, which

was marketed by both petitioner and respondents. Pet. App.

18a. Both petitioner and CISPI submitted proposed standards

to the subcommittee. /d. CISPI’s proposed standard was never

alleged to have excluded petitioner's product. Pet. App. 18a,

31a. CISPI’s proposed standard was accepted by the subcom-

mittee and forwarded to the ASSE. The ASSE rejected CISPI's

proposal and decided not to adopt any standard. Pet. App. 18a.

The Court of Appeals ruled that there was “no concrete

evidence in the record that CISPI acted improperly” with re-

spect to the ASSE. Pet. App. 18a. Petitioner asserts that it did

have such evidence in two respects. First, it characterizes

CISPI's proposal as being so meaningless as to constitute a

bad faith proposal. Second, it asserts that CISPI “packed” the

meeting at which the parties’ proposals were voted on.

statement made in petitioner's Statement of the Case should not be misconstrved

as agreement therewith; in fact, respondents view much of petitioner's State-

ment of the Case as being incorrect and unsupported by the record.

7

These assertions were properly viewed by the courts below

as not being supported by evidence sufficient to take this claim

to the jury. With respect to the nature of CISPI’s proposed

standard, the trial court ruled, inter alia, that there was “no

evidence before us by which we could judge what that standard

really means.” Pet. App. 31a (emphasis added).*’ More funda-

mentally, the First Circuit ruled that, whether CISPI’s standard

was good, bad or indifferent, there was no evidence that the

standard had any effect on petitioner because there was “no| ]

. . concrete evidence that the submission of CISPI’s proposal

caused (or even influenced) ASSE’s decision not to adopt any

standard.” Pet. App. 18a. With respect to the purported “pack-

ing” of the meeting, the First Circuit concluded that the jury

could not find unfair overrepresentation by CISPI where the

record evidence showed, inter alia, that only six of the sixteen

ASSE subcommittee members were CISPI members. Pet. App.

18a. In these circumstances, petitioner’s analogy to Allied

Tube & Conduit Corp. v. Indian Head, Inc., 486 U.S. ;

108 S. Ct. 1931 (1988), is inapt. The First Circuit properly

applied /ndian Head to the facts herein and found no antitrust

violation.*

‘Footnote 19 to the Petition addresses the arcane issue of whether CISPI’s

proposal constituted a “performance standard.” The footaote provides a plain

illustration of the technical issues with which the trial court was confronted

without any expert testimony to aid it. Even now, petitioner relies in footnote

19 on evidence which it admits was excluded at trial, despite the fact that

petitioner took no issue with that evidentiary ruling, either on appeal or in its

instant petition.

*Moreover, /ndian Head addressed the applicability of Noerr-Pennington

protection for private lobbying efforts; it expressly did not reach issues as to

the illegality of the substantive petitioning conduct involved in the case. 108

S. Ct. at 1936 & n.3. Indian Head is not pertinent to this case because neither

the district nor the appellate court relied upon any constitutional privilege in

their rulings as to the ASSE proceedings. Pet. App. 16a-19a; 30a-32a. Both

courts found against peti’:oner with respect to this issue because petitioner did

not come forward with sufficient evidence to raise a triable issue under the

antitrust laws.

8

2. Respondents’ Advertising

Petitioner alleged that CISPI advertised the CISPI coupling

as being superior to competing products and that these adver-

tised claims of superiority were false. The Court of Appeals

ruled that, “without more evidence,” mere claims of product

superiority, especially when made to a “technical audience,”

were “mere ‘sellers’ talk.”” Pet. App. 19a.° The First Circuit

further held that there was insufficient evidence to allow a jury

to find that this advertisement was false. With respect to

petitioner’s claim that various product failures proved the fal-

sity of respondents’ assertions of superiority, the Court of

Appeals stated that the record contained no evidence of failures

of hubless couplings, but only evidence of failures of other of

respondents’ products. Pet. App. 20a. Petitioner’s evidence

that its product out-performed respondents’ product in a par-

ticular laboratory test was also deemed insufficient because

findings as to the relative performance of the two couplings

“did not show that CISPI’s coupling was defective.” Pet. App.

20a.

3. Market Power

Petitioner alleges that the testimony of its expert that CISPI

and its members had market power was sufficient to warrant

submission of the market power issue to the jury. Petitioner

fails to note that this testimony was left totally lacking in

foundation when the trial court excluded the expert’s entire

analysis of market share because the expert “based his opinion

significantly upon a few unmemorialized telephone calls, and

‘The First Circuit also stated that it viewed the false advertising claims as

constituting “charges of state-law business torts, not violations of the federal

antitrust laws.” Pet. App. 19a. However, the court “assume[d] that point aside”

and treated the false advertising allegations on their merits. /d.

9

[admitted to] estimat[ing] the reliability of his model as be-

tween ‘1 percent and 99 percent.’” Pet. App. 22a. The trial

court’s exclusion of this evidence was, as the Court of Appeals

held, entirely proper.°

° Petitioner’s argument that respondents’ market power may be proven merely

by regarding the difference between the parties’ respective market shares in

Massachusetts and their market shares in the rest of the country is plainly

flawed. As the Court of Appeals pointed out, petitioner controlled about 65

percent of the coupling market inside Massachusetts, “where Clamp-All had

a monopoly for several years because only its coupling met the state's perform-

ance standard.” Pet. App. 4a.

Conclusion

The petition for a writ of certiorari should be denied.

JOHN M. HARRINGTON, JR.

THOMAS H. HANNIGAN, JR.

ROPES & GRAY

225 Franklin Street

Boston, Massachusetts 02210

(617) 423-6100

Counsel for The Eastern

Foundry Company

ALAN R. HOFFMAN

LYNCH, BREWER, HOFFMAN

& SANDS

101 Federal Street

Boston, Massachusetts 02110

(617) 951-0800

Counsel for Anaheim

Foundry Company

MARK W. PEARLSTEIN

GOODWIN, PROCTER & HOAR

Exchange Place

Boston, Massachusetts 02109

(617) 570-1000

Respectfully submitted,

JOHN J. CURTIN, JR.*

WILLIAM G. SOUTHARD

JODY E. FORCHHEIMER

BINGHAM, DANA & GOULD

150 Federal Street

Boston, Massachusetts 02110

(617) 951-8000

Counsel for Cast lron

Soil Pipe Institute

HENRY P. SAILER

ELIZABETH FOOTE

COVINGTON & BURLING

1201 Pennsylvania Avenue

Washington, D.C. 20004

(202) 662-6000

Counsel for Charlotte Pipe

& Foundry Company

JOHN F. TENER

THEODORE TUCCI

ROBINSON & COLE

One Commercial Plaza

Hartford, Connecticut 06103

(203) 275-8200

Counsel for United States

Pipe and Foundry Company, Inc.

Counsel for Jones Manufacturing Company, Inc.

November, 1988

*Counsel of Record

1}

Appendix A

STATEMENT REQUIRED BY RULE 28.1

1. Anaheim Foundry Company

Anaheim Foundry Company has no parent companies, af-

filiates or subsidiaries.

2. Cast Iron Soil Pipe Institute

The Cast Iron Soil Pipe Institute has no parent companies,

affiliates or subsidiaries.

3. Charlotte Pipe & Foundry Company

Charlotte Pipe and Foundry Company, N.E.

Charlotte Pipe and Foundry Company, S.W.

4. The Eastern Foundry Company

Peerless Heater Company

Peerless Industries, Inc.

5. Jones Manufacturing Company, Inc.

Clearbrook, Inc.

J.P. Manufacturing, Ltd.

Jones Acquisition, Ltd.

The Jordan Company

6. United States Pipe and Foundry Company, Inc.

Hillsborough Holdings Corporation

Apache Holdings Corporation

Basins, Inc.

Basins of Toledo, Inc.

Best Insurors, Inc.

Best Insurors of Mississippi, Inc.

Black Warrior Methane Corporation

Black Warrior Transmission Corporation

12

Broadnax Jewelry Company

Casting Holdings Corporation

Celotex Inoue (Japan) Corporation

Cherokee Holdings Corporation

Coast to Coast Advertising, Inc.

Computer Holdings Corporation

D.J. Dinsmore Co.

Dixie Building Supplies, Inc.

The Georgia Marble Company

The Georgia Marble Land Company

Hamer Holdings Corporation

Homes Holdings Corporation

JW Aluminum, Inc.

JW Resources Holdings Corporation

JW Window Components, Inc. (DE.)

JWI Holdings Corporation

J.W. Walter, Inc. (DE.)

J.W. Walter, Inc. (FL.)

Jefferson Warrior Railroad Company, Inc.

Jim Walter Computer Services, Inc.

Jim Walter Homes, Inc.

Jim Walter Insurance Services, Inc.

Jim Walter Resources, Inc.

Jim Walter Window Components, Inc. (WI.)

Jimco Stone Centers, Inc.

Land Holdings Corporation

Mid-State Holdings Corporation

Mid-State Homes, Inc.

NS Holdings Corporation

Oil Holdings Corporation

Railroad Holdings Corporation

Sanford Holdings Corporation

Shore Oil Company

Sloss Industries Corporation

13

Southern Precision Corporation

United Land Corporation

U.S. Pipe Realty, Inc.

Vestal Manufacturing Company

Walter Home Improvement, Inc.

Walter Industries, Inc. (2 volumes)

Walter Land Company

Warren Industries, Inc.

Wedlo, Inc.