Petition — Sitkin Smelting & Refining Co. v. FMC Corp.
Supreme Court brief1978
Ask Donna
What actually matters in this document.
Text
IN THE
Supreme Court of the United "States... cuce
ge Supreme Court U,@
rile S’
|
' AUG 4 1978
October Term, 1978.
No.
8-208
SITKIN SMELTING & REFINING CO., INC.,
MONONGAHELA IRON &
v.
METAL CO., INC.,
Petitioners,
FMC CORPORATION,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT,
THEODORE R. MANN,
MANN & UNGAR,
Of Counsel: Professional Association,
Louis B. ScHwaARtTz, 1711 Rittenhouse Square,
3400 Chestnut Street,
Philadelphia, Pa. 19104
Philadelphia, Pa, 19103
Attorneys for Petitioners.
International Printing Co., 711 So. 50th St., Phila., Pa, 19143 — Tel. (215) 727-8711
TABLE OF CONTENTS.
REASONS FOR GRANTING THE WRIT ...........0.ceececesees
I,
The Third Circuit’s Decision on the Antitrust Issue
Conflicts in Principle With the Recent Decision of
This Court in National Society of Professional Engi-
ee ee
A. The Conspiracy Is Illegal on Its Face Because of
Its Anticompetitive Character ...............
B. The Conspiracy Is Illegal on Its Face Because of
the Absence of Any Lawful Purpose ..........
Il. The Antitrust Question Presented Is of Great
III.
IED. on cen scccdesdancccds coanceteccenses.
The Third Circuit's Decision on the Contract Claim
Is in Direct Conflict With Decisions of This Court
and the Circuit Courts Regarding the Appropriate
Standards of Appellate Review ..................
GT on cccencesesecccuccctsccseccescecccevcedsss
Aprenpix A—Court of Appeals Opinion ..................
Appenpix B—District Court Opinion ...............0.005:
Aprenpix C—Interrogatories to the Jury in the District Court A35
TABLE OF CITATIONS.
Page
Addyston Pipe and Steel Co. v. United States, 175 U. S. 211
PR ee Ser ee i a 5
American Hot Rod Association, Inc. v. Carrier, 500 F. 2d 1269
SE Es dans i Cael ct wel) cgainawies a weokenen i2
Copper Liquor, Inc. v. Adolf Coors Co., 506 F. 2d 934 (5th
RL Gta bias pac ud cee a kae meee ees ceeenk 12
Fenstermacher v. Philadelphia National Bank, 493 F. 2d 333
ee cre eS 10
Kaufman v. Mellon National Bank & Trust Co., 366 F. 2d 326
TARTS Rae ci ant op 10
Lavender v. Kurn, 327 U. S. 645 (1946) .................. 11, 12
Melia v. Ford Motor Co., 534 F. 2d 795 (8th Cir. 1976) .... 12
National Society of Professional Engineers v. United States,
Se a as Se INE 6 We 8 here 4 Sseeins wetness o'0'e 5, 7, 8,9
Northern Pacific Railway Co. v. United States, 356 U. S. 1
CEE: Seaehe bay as ade phns oe res t@ce weed wewemedions.s 7
Premier Electric Construction Co. v. Miller-Davis Co., 422 F.
Ee Pe IE op leis e's shire’ te ning dives swe selh ees 10
Sitkin Smelting & Refining Co., Inc. v. FMC Corporation, 575
Py ee Ce BD ics designe enant veeinmedaas'es 1
Thomas v. Thomas Flexible Coupling Co., 353 Pa. 591, 46 A.
ND co a Vick Benk vies khwckeoteudaseken canes » ll
United States v. Addyston Pipe and Steel Co., 85 F. 271 (6th
SS a eh cn kede we see Ckels cenGiennionon aboudeie 8,9
United States v. Penn-Olin Cheinical Co., 378 U. S. 158
GREE Whisk crdaricevccseres PAN GA + ERRNO Rabeeea ye 7
U. S. Philips Corp. v. Ferro Corp., 522 F. 2d 1100 (6th Cir.
eke iss AeEKRE Ree e sie all bak aes woe dawn Hes 12
Venzie Corp. v. United States Mineral Products Co., 521 F.
SE WY IE beh. 0s ac epvesenhcbcacenchiseue’ 11, 12
ET oe
eichiica ans AND RULES.
United States Code, Title 15:
es cica le putea A ey Os \ aioe cia (Vee Es dk cac'ee neds
UE Mahe ine Maran RE Rae oe’ db dieWidday es aeciucieuw ci
United States Code, Title 28:
§ 1254(1)
§ 1331
ee ee ae a ne a a a? eo ho ee ee
Ad ee er eee oe Pt a a tf 2) © 2 © ee eee 2
et a ee ee een Cen.) fe oY ee ee
SES SCECSHCSSECSCSASCHSHFSHSTECCROECHOHOEESSCSC HO HBHEOC EEOC EC es
ae? SURE OS SEACH OS Oa 60.088 2.6 6 O 6
MISCELLANEOUS AUTHORITIES.
1 Corbin, Contracts § 24 (1950)
PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS FOR THE
THIRD CIRCUIT.
The Petitioners, Sitkin Smelting & Refining Co., Inc.
and Monongahela Iron & Metal Co., Inc. (hereinafter
“Sitkin” and “Monongahela” ), respectfully pray that a writ
of certiorari issue to review the judgment and opinion of
the United States Court of Appeals for the Third Circuit
entered in this proceeding on April 13, 1978.
OPINIONS BELOW.
The opinion of the Court of Appeals for the Third
Circuit and the dissenting opinion are officially reported
as Sitkin Smelting & Refining Co. v. FMC Corp., 575 F.
2d 440 (3d Cir. 1978), and are set forth in Appendix A to
this Petition.
The opinion of the United States District Court for
the Eastern District of Pennsylvania is not officially re-
ported. It is set forth in Appendix B to this Petition.
JURISDICTION.
The judgment of the Court of Appeals for the Third
Circuit was entered on April 13, 1978. A timely petition
for rehearing in banc was denied on May 11, 1978, and this
Petition is filed within 90 days of that date.
The Court’s jurisdiction is invoked under 28 U. S. C.
§ 1254(1).
2 Petition for Writ of Certiorari
QUESTIONS PRESENTED.
1. Whether section one of the Sherman Act is vio-
lated when a buyer and seller conspire to have seller
solicit bids from 50 of buyer’s competitors in order to
award the contract to buyer at the price quoted by the
highest and best bidder.
2. Whether an appellate court may set aside a jury’s
answer to a special interrogatory regarding the intent of
contracting parties by characterizing as “neutral” evidence
which the district court found to be “more than sufh-
cient[ly] credible” and by weighing against it other evi-
dence which the appellate court deems to be “of more
importance.”
STATUTES INVOLVED.
United States Code, Title 15:
§1. Trusts, etc., in restraint of trade illegal.
Every contract, combination in the form of trust
or otherwise, or conspiracy in restraint of trade or
commerce among the several states, or with foreign
nations, is declared to be illegal... .
Petition for Writ of Certiorari 3
STATEMENT OF THE CASE.
As a result of hurricane damage to its 30 acre rayon
manufacturing plant, FMC Corporation (hereinafter
“FMC” ) decided to dispose of the plant and its contents.
Because the plant contained vast quantities of machinery
and equipment, FMC solicited the bid of Sitkin, a scrap
metal dealer. Sitkin demurred because FMC in the past
had always given its scrap business to his local competi-
tor, Krentzman, and Sitkin did not want to be “used” to
set a price for his competitor. FMC assured Sitkin that if
he bid, it would not disclose the bid to any other bidder
or use it to negotiate higher bids, and it would accept the
highest and best bid if any were accepted. As a result of
those assurances, admitted by FMC, plaintiffs bid.
Plaintiffs’ bid was higher by several hundred thou-
sand dollars than that of Krentzman, the only other bidder.
Neither bid was accepted, however, because FMC do-
nated the real estate to the local community and solicited
a second round of bidding, this time for the machinery
and equipment alone.
FMC then conspired with Krentzman to award
Krentzman the contract at the price that would be bid by
the highest and best bidder. It invited 50 scrap dealers
from throughout the country to visit and inspect the plant
as a condition of their submitting bids. Twelve dealers,
including plaintiffs and Krentzman, came, evaluated the
metals and bid. Once again, as they had done in con-
nection with the first round of bids, plaintiffs devoted
hundreds of hours to the process of evaluating the metals.
Once again, plaintiffs’ bid was highest and best. Effectu-
ating the conspiracy, FMC then revealed it to Krentzman,
took a rebid from him, and awarded him the contract.
Sitkin invoked the jurisdiction of the federal district
court under 28 U. S. C. §§ 1331, 1337, and 15 U. S. C. § 15
4 Petition for Writ of Certiorari
on its claim against FMC for violation of the Sherman
Act, and under 28 U. S. C. § 1332 on its claim for breach
of contract.
The jury found all the essential facts by answering
special interrogatories.’ It found that the contractual as-
surances FMC made to Sitkin were intended to endure
through the second round of bidding. It found that FMC
breached those assurances and that it unlawfully con-
spired with Krentzman to exclude all other bidders from
the contract and award it to Krentzman at a price set by
the highest and best of all the bids.
The District Court found that the jury’s factual find-
ings were supportel by “more than sufficient credible
evidence.” It affirmed the contract award, but set aside
the antitrust award because, though FMC’s conduct was
“reprehensible”, “deceitful” and “fraudulent”, in its view
the conspiracy did not constitute a violation of the Sher-
man Act.
The Court of Appeals conceded that the case involved
a reprehensible conspiracy, entered into in advance of the
bidding, to manipulate the bids of businessmen in order
to award a contract to a co-conspirator at a price bid by
others. But the Court, Judge Gibbons dissenting, held
that there had not been sufficient judicial experience to
classify such practices as per se violations, and affirmed
the District Court.
The Court of Appeals, Judge Gibbons dissenting, also
set aside the contract verdict, holding the evidence insuffi-
cient to support the jury’s finding that the contract was
intended to endure through the second round of bidding.
1. The jury’s answers to the special interrogatories are set forth
in Appendix C hereto.
Petition for Writ of Certiorari 5
REASONS FOR GRANTING THE WRIT.
The majority’s decision conflicts in principle with this
Court's decision in National Society of Professional Engi-
neers v. United States, 98 S. Ct. 1355 (1978), decided less
than two weeks after the instant decision, and with this
Court’s decision in Addyston Pipe and Steel Co. v. United
States, 175 U. S. 211 (1899), decided 79 years ago. The
question presented is of great importance because it in-
volves a common practice which corrodes the competitive
system and for which there is no real remedy apart from
the anti-trust laws.
Every judge in this case—the trial judge (A28-30),
as well as the majority (Al10) and dissenting (A21-23)
judges on the Court of Appeals—conceded that there was
ample evidence of a conspiracy. That conspiracy was
to induce scrap dealers throughout the country to ap-
praise and bid on the metals in FMC’s plant, by fraudu-
lently advising them that they were engaged in legitimate
competitive bidding, so that the contract could be let to
FMC’s favored scrap metal dealer at a price set by the
highest and best bid. Although the entire purpose and
the whole effect of such a conspiracy is anticompetitive,
and no redeeming element has ever been suggested for it,
the majority concluded that there has not been sufficient
judicial experience with such practices to classify them as
per se violations.
I. The Third Circuit’s Decision on the Antitrust Issue
Conflicts in Principle With National Society of Pro-
fessional Engineers v. United States.
In National Society of Professional Engineers v.
United States, supra, Justice Stevens, for the Court, con-
cluded that while the anti-trust laws do not require com-
petitive bidding, a ban on competitive bidding is illegal on
6 Petition for Writ of Certiorari
its face. It is “not price fixing as such”, but “no elaborate
industry analysis is required to demonstrate the anti-com-
petitive character of such an agreement” for any agree-
ment which “interferes with the setting of price by free
market forces is illegal on its face.” 98 S. Ct. at 1365. For
the same reasons, a conspiracy to conduct spurious com-
petitive bidding is facially illegal.
A. The Conspiracy Is Illegal on Its Face Because of
Its Anticompetitive Character.
Free market forces are more effectively destroyed by
spurious competitive bidding than by a ban. A ban is
open and above board. All interested parties know that
other means must be employed to compete, and they may
be expected to use them. But where, as here, business-
men are deceived into believing that they are competing
for a contract being let on a one-bid auction,’ they are
induced to submit their best price, they are lulled into
sitting back and waiting for the results, and they are totally
precluded from using any competitive means whatever to
gain access to the market for the contract.
It is argued that while free market forces were used
deceitfully here, they did in fact achieve their principle
and beneficent purpose of setting the price. But that is
not so. If honest competitive bidding had occurred, either
the price or the identity of the buyer, or both, would have
been different. Either Krentzman would have bid higher
2. The invitation to bid stated, “No revision of bids will be ac-
cepted after the bid has been submitted; your best bid must be
submitted first.” (671la)
(Page numbers followed by a small letter “a” refer to the pages
of the two volume Appendix to the Briefs which was filed in the
Third Circuit. A copy of the Appendix has been transmitted to
the Court pursuant to Supreme Court Rule 21.
Page numbers preceded by the capital letter “A” refer to the
pages within the appendices to this Petition. )
Petition for Writ of Certiorari 7
in the first place * and been awarded the contract at a dif-
ferent price, or plaintiffs would have been awarded the
contract.
Even if there had been no competitive bidding—that
is, if FMC had exercised its lawful right to deal with
Krentzman alone—the price would likely have been very
different, and in the end some other buyer may very well!
have prevailed. What Krentzman might have paid in
such a one-on-one negotiation, knowing that there were
many other interested buyers FMC could turn to, will
never be known. For the conspiracy not only rendered
the competitive bidding a sham; it also destroyed the
potential competition of other buyers “in the wings” which
necessarily affects negotiations even between a single
buyer and a single seller. United States v. Penn-Olin
Chemical Co., 378 U. S. 158, 174 (1964). Here there was
no such potential competition, for from the very begin-
ning all potential competitors had been fraudulently in-
duced to reveal their prices—the principal means by which
businessmen compete.
The price which free market forces would have pro-
duced cannot be determined here because from the mo-
ment the conspiracy began those forces did not function.
Competition was not at work at any time. Instead, thou-
sands of hours of work by a dozen businessmen were di-
verted from normal productive business channels to serve
the anticompetitive purposes of the conspirators. Cf.
Northern Pacific Ry. Co. v. United States, 355 U. S. 1, 4
(1958).
The factual distinction between National Society and
the instant case is that the agreement in National Society
was an agreement among potential competitors, whereas
3. Instead, knowing that he would be allowed to see and
match the highest bi first bid Blt x
the ball park” (3680) was intended merely to be “in
8 Petition for Writ of Certiorari
here the conspiracy was between a seller, FMC, and one
of many potential buyers. Yet there is no difference in
principle because competition is destroyed as much in the
one case as in the other. If the bidders had conspired to
let Krentzman be the high bidder, FMC would have been
the victim—the case would have presented the classic per
se violation, on all fours with Addyston Pipe and Steel Co.
v. United States, supra. Here, by falsely inducing the
bidders to submit their best bids and to compete no fur-
ther, pursuant to a vertical conspiracy to let Krentzman
steal the best bid, the legitimate bidders became the vid
tims. The identity of the victim is immaterial, however,
where both practices completely thwart competitive forces
and result in the allocation of a job to a different con-
tractor and at a different price than would have prevailed
in a free market.
Spurious competitive bidding, even more than a ban
on competitive bidding, is definitionally anticompetitive.
The majority’s conclusion that before its anticompetitive
character is established, more judicial experience is re-
quired (A13) with what they conceded was a reprehensi-
ble conspiracy to manipulate bids (A16), simply defies
explanation.
B. The Conspiracy Is Illegal on Its Face Because of
the Absence of Any Lawful Purpose.
Where an agreement restrains trade but also has some
other purpose, a rule of reason inquiry focusing on the
challenged restraint’s impact on competition may be re-
quired. National Society of Professional Engineers v.
United States, 98 S. Ct. at 1364-1365. But where there is
no purpose even suggested other than the anticompetitive
purpose which appears on the face of the conspiracy, then
the law has been violated and the inquiry is ended. Judge
Petition for Writ of Certiorari 9
(later Chief Justice) Taft made this point in his famous
Court of Appeals decision in the Addyston case, United
States v. Addyston Pipe and Steel Co., 85 F. 271 (6th Cir.
1898 ), when he said: |
“In such a case [where there is nothing to justify or
excuse the restraint] there is no measure of what is
necessary to the protection of either party, except the
vague and varying opinion of judges as to how much,
on principles of political economy, men ought to be
allowed to restrain competition. There is in such con-
tracts no main lawful purpose, to subserve which its
reasonableness is measured, but the sole object is to
restrain trade in order to avoid the competition, which
it has always been the policy of the common law to
foster.” 85 F. at 283.
Judge Taft sharply criticized those courts which
“have set sail on a sea of doubt, and have assumed
the power to say, in respect to contracts which have
no other purpose and no other consideration on either
side than the mutual restraint of the parties, how
much restraint of competition is in the public inter-
est, and how much is not.” Id. at 238-284.
It was on this basis that Judge Gibbons dissented in the
instant case, calling his difference with the majority “fun-
damental,” as indeed it was. In the first place, no “ju-
dicial experience” is needed to assess the effect of corrupt
bidding practices. In the second place, where no lawful
purpose for the conspiracy is even suggested, an inquiry
into “how much restraint of competition is in the public
interest, and how much is not,” Addyston, 85 F. at 284,
is simply an impermissible judicial inquiry.
10 Petition for Writ of Certiorari
Il. The Antitrust Question Presented Is of Great Impor-
tance.
The question of the facial illegality of a conspiracy
to frau‘*ulently extract from businessmen their best price
is of great importance not only because such a conspiracy
eats at the heart of competition, but also because only
the antitrust laws can put a stop to such practices. Under
normal contract and tort principles, the contract letting
party and his favored bidder participating in such a scheme
cannot be denied the profits of their conspiracy. Absent
special assurances of a type that Sitkin received here, the
highest and best bidder has no contractual right to recover
at all, because a bid submitted in response to a bid solici-
tation does not create a contract. Fenstermacher v. Phila-
delphia National Bank, 493 F. 2d 333, 342 (3d Cir. 1974);
Premier Electric Construction Co. v. Miller-Davis Co., 422
F. 2d 1132, 1135 (7th Cir. 1970); 1 Corbin, Contracts § 24
(1950). In a tort action for fraud and deceit, a duped
bidder's damages are limited to his out-of-pocket costs in
preparing a bid. Kaufman v. Mellon National Bank &
Trust Co., 366 F. 2d 326, 331 (3d Cir. 1966). Thus ab-
sent an antitrust remedy, there simply is no real deterrent
to engaging in such fraudulent bidding practices.
We urge this Court to grant certiorari, and to hold
that the Sherman Act outlaws a conspiracy to issue a
spurious invitation to bid in order to set the price between
the conspirators.
Ill. The Third Circuit’s Decision on the Contract Claim Is
in Direct Conflict With Decisions of This Court and
the Circuit Courts Regarding the Appropriate Stand-
ards of Appellate Review.
It is not disputed that where no duration is specified
in a contract, the intention of the contracting parties as to
duration must be determined by the jury from the sur-
Petition for Writ of Certiorari 11
rounding circumstances and by the application of a rea-
sonable construction to the agreement as a whole. Thomas
v. Thomas Flexible Coupling Co., 353 Pa. 591, 46 A. 2d
212, 215 (1946).
The majority below reversed the jury’s express find-
ing that the contract between Sitkin and FMC endured
through the second round of bidding. (Interrogatory 2,
A36). Eight items of evidence—which the trial judge
found to be “more than sufficient[ly] credible” (A27)—
were regarded as “neutral” or “argumentative” by the
majority, which weighed other facts against them and
found those other facts to be “of more importance” (A8).
This it simply may not do. Lavender v. Kurn, 327 U. S.
645 (1946). We urge this court to grant certiorari in order
to restate the appropriate standards of appellate review.‘
The evidence of the parties’ intention as to duration
is set out in very summary form at pages 6-10 of peti-
tioners’ Petition for Rehearing and Suggestion of Appro-
priateness of Rehearing In Banc which has been filed with
the Court pursuant to Supreme Court Rule 21. The ma-
jority did not dispute that evidence. It simply dismissed
it as “neutral” and “argumentative,” singularly and in the
aggregate, and weighed it against other evidence which
it regarded as more persuasive. Almost all of the evidence
came from the cross-examination of one or another of the
three-man FMC team responsible for the disposal of the
facility. The jury had a full opportunity to observe all
three as they were subjected to the truth-finding processes
which are at the heart of our system of jurisprudence, and
drew the all but inevitable inference that the assurances
were intended to endure throughout. the bidding process.
4, Chief Judge Seitz, who wrote the Court's opinion, pursued
the same impermissible process of weighing conflicting evidence in
Venzie Corp. v. United States Mineral Reina Co., 521 F. 2d 1309
(3d Cir. 1975).
12 Petition for Writ of Certiorari
The record firmly supports the conclusion of dissent-
ing Judge Gibbons that the majority “substituted its own
evaluation of the evidence for that of the jury.” (A21)
By doing so, the majority acted in direct conflict with the
principles announced by this Court in Lavender v. Kurn,
327 U. S. 645, 653 (1946):
“Whenever facts are in dispute or the evidence is such
that fair-minded men may draw different inferences,
a measure of speculation and conjecture is required
on the part of those whose duty it is to settle the dis-
pute by choosing what seems to them to be the most
reasonable inference. Only when there is a complete
absence of probative facts to support the conclusion
reached does a reversible error appear. But where,
as here, there is an evidentiary basis for the jury’s
verdict, the jury is free to discard or disbelieve what-
ever facts are inconsistent with its conclusion. And
the appellate court’s function is exhausted when that
evidentiary basis becomes apparent, it being imma-
terial that the court might draw a contrary inference
or feel that another conclusion is more reasonable.”
The Court also departed from the principle widely fol-
lowed in other circuit courts that evaluating the “credibil-
ity of the evidence and the weight of it” is beyond the
perimeters of appellate review. Melia v. Ford Motor Co.,
534 F. 2d 795, 799 (8th Cir. 1976); U. S. Philips Corp. v.
Ferro Corp., 522 F. 2d 1100, 1101 (6th Cir. 1975); Copper
Liquor, Inc. v. Adolph Coors Co., 506 F. 2d 934 (5th Cir.
1975); American Hot Rod Ass‘n., Inc. v. Carrier, 500 F. 2d
1269, 1276 (4th Cir. 1974). Cf. Venzie Corp. v. United
States Mineral Products Co., supra.
Petition for Writ of Certiorari 13
CONCLUSION.
For the reasons set forth above, a writ of certiorari
should issue to review the judgment and opinion of the
Third Circuit.
Respectfully submitted,
THEODORE R, MANN
MANN AND UNGAR,
Professional Association
1711 Rittenhouse Square
Philadelphia, Pa. 19103
APPENDIX A
UNITED STATES COURT OF APPEALS
For THE THIRD CIRCUIT
No. 77-1003/4
SITKIN SMELTING & REFINING CO., INC. AND
MONONGAHELA IRON & METAL CO., INC.,
Appellants in No. 77-1003
v.
FMC CORPORATION
SITKIN SMELTING & REFINING CO., INC. AND
MONONGAHELA IRON & METAL CO., INC.,
v.
FMC CORPORATION,
Appellant in No. 77-1004
(D. C. Civil No. 74-798)
On APPEAL FROM THE UNITED STATES District Court
FOR THE EASTERN DiIsTRICT OF PENNSYLVANIA
Argued September 8, 1977
Before Sertz, Chief Judge, and Grssons and WEIs,
Circuit Judges.
(Al)
A2 Appendix A
Theodore R. Mann, Esq.
Barry E. Ungar, Esq.
Larry H. Spector, Esq.
Mann and Ungar, P. A.
1711 Rittenhouse Square
Phila., Penna. 19103
Attorneys for Appellants in
No. 77-1003
Of Counsel:
Louis B. Schwartz
3400 Chestnut Street
Phila., Penna. 19104
Matthew J. Broderick, Esq.
Stephen A. Stack, Jr., Esquire
Mari M. Gursky, Esquire
Dechert, Price & Rhoads
si 3400 Centre Square West,
1500 Markei Street
Phila., Penna. 19102
Attorneys for FMC
Corporation, Appellant in
77-1004.
Opinion of the Court
(Filed April 13, 1978)
Seitz, Chief Judge.
Plaintiffs Sitkin Smelting & Refining Co., Inc. and
Monongahela Iron & Metal Co., Inc. (“plaintiffs”), sued
FMC Corporation ( “defendant” ) in the district court. In
Count 1, plaintiffs’ diversity claim alleged that by awarding
to Joseph Krentzman and Sons (“Krentzman”) a contract
Appendix A A3
to dismantle defendant’s Lewistown rayon facility after
allowing Krentzman to see planitiffs’ bid, FMC breached
contractual obligations it owed plaintiffs. In Count 2,
plaintiffs alleged a violation of Section 1 of the Sherman
Act in that defendant conspired with Krentzman, who was
not named as a defendant, to commit two per se violations
of the antitrust laws: an illegal boycott and price fixing.
The court submitted Counts 1 and 2 to the jury on
special interrogatories. The jury's answers favored plain-
tiffs. The court then entered judgment against defendant
on both counts. Defendant filed motions for judgment not-
withstanding the verdict with respect to both the contract
and antitrust claims and aiso filed a motion for a new trial.
The district court denied the motion for judgment n.o.v.
and denied the motion for a new trial on Count 1, the con-
tract claim. It granted defendant’s motion for judgment
n.o.v. and entered judgment in its favor on Count 2, the
Sherman Act claim.
Defendant appealed from the judgment of $700,000
entered for plaintiffs on the contract claim and from the
denial of the motion for a new trial. Plaintiffs appealed
from the entry of judgment in favor of defendant on the
antitrust claim.
We turn to the factual settia,.. :i of which the dispute
arose. In view of the ju answer to the interrogatories,
we set forth the facts in a ig) t most favorable to plaintiffs.
Defendant owned : « wifacturing facility in
Lewistown, Pennsylvat. summer of 1972, the
facility was damaged extcusiveiy by a hurricane. There-
after, defendant decided to close the plant and to sell or
otherwise dispose of it. In addition to the land and the
buildings, the assets included salvageable scrap metal,
machinery, equipment, and inventory. Defendant's agent
solicited Sitkin to submit a bid for the plant and its con-
tents. Plaintiffs submitted such a bid which, by its terms
A4 Appendix A
was to expire October 20, 1972. Krentzman was the only
other bidder.
After the two bids were received, defendant altered
its plans and did not accept either bid. It decided to
donate the land and buildings at the plant site to a public
authority. In the words of plaintiffs’ counsel, defendant
then “started all over again.” Thus, in July, 1973, defend-
ant prepared elaborate bidding documents with respect to
the sale of the scrap. Those documents contained various
options including possible participation by defendant in
the proceeds of the sale of the property. Invitations to
bid were sent to approximately 50 prospective bidders
throughout the United States. The invitations explicitly
reserved the right to reject any and all bids. They also
stated: “No revision of bids will be accepted after the bid
has been submitted; your best bid must be submitted first.”
Bids were to be submitted by October 22, 1973.
Sitkin submitted a bid jointly with its co-plaintiff.
Krentzman also submitted a bid, as did many other
invitees.
After the October 22 deadline, individual clarification
meetings were held with certain of the bidders, including
plaintiffs and Krentzman. Subsequent to one of these
clarification meetings between defendant's agents and
Krentzman, Krentzman submitted a bid higher than plain-
tiffs, and Krentzman’s bid was eventually accepted. This
lawsuit followed.
I. THe Contract CLAIM
Plaintiffs contend that among the original bids sub-
mitted in 1973, theirs was the highest. They argue that in
awarding the scrap contract to Krentzman after Krentz-
man had seen plaintiffs’ bid and then revised its own, the
defendant breached its commitment made in 1972 to plain-
Appendix A A5
tiffs and carried forward to 1973, that if plaintiffs bid,
defendant would not disclose their bid or use it to nego-
tiate a higher bid, and would award the bid to plaintiffs if
plaintiffs were the high bidder. We turn to the details
of the evidence.
In 1972, prior to the submission of plaintiffs’ first bid,
Charles Kline, an employee of defendant, held a conversa-
tion with Lewis Sitkin, president of one of the plaintiffs,
Sitkin, concerning a possible bid by Sitkin to purchase the
Lewistown assets. Because Sitkin had not succeeded in
doing business with defendant in the past, it sought as-
surances of good faith treatment by defendant should it
bid for such assets. Sitkin was assured that if it submitted
a bid to purchase defendant’s Lewistown facility, defend-
ant would not disclose that bid to any other bidder, would
not use the bid to negotiate higher bids from other bidders,
and would, if it accepted a bid, accept the “high” bid.
Plaintiffs do not contend that there was any breach
of these assurances insofar as the 1972 bidding was con-
cerned. What they do contend is that the 1972 assurances
carried over to the 1973 bidding, and that those assur-
ances were violated when defendants disclosed plaintiffs’
bid to Krentzman, thereafter permitted Krentzman to sub-
mit a higher bid, and then accepted Krentzman’s altered
bid. Accordingly, at the trial below plaintiffs sought dam-
‘ages for breach of contract arising from the defendant's
failure to award the contract to them on the theory that,
since the 1972 high bid assurance carried over to 1973,
and since plaintiffs submitted the original high bid in 1973,
defendant was contractually obligated to accept it.’
1. Plaintiffs do not seek recovery for the costs of preparing the
bids. Indeed, plaintiffs’ counsel conceded at the close of the evi-
dence that they had not introduced any evidence of any damages
based solely on the possible breach of the iS72 assurances other
than the 1972 high bid assurance.
A6 Appendix A
The defendant contends, inter alia, that there was
insufficient evidence as a matter of law to submit to the
jury the issue as to whether the 1972 high bid assurance
carried over to 1973.
We think the evidence warranted the jury in finding
that the assurances alleged by plaintiffs were given in con-
nection with the 1972 solicitation of bids. It is important
to analyze the legal consequences of the high bid assur-
ance, however, because it is basic to plaintiffs’ breach of
contract claim arising out of defendant’s failure to award
the contract to plaintiffs in 1973.
In plaintiffs’ view the 1972 agreement to award the
contract to only the high bidder endured as long as the
parties intended it to endure. Plaintiffs argue that was
until a contract for the disposal of the machinery and
equipment was awarded in a bidding procedure. They
say that there was sufficient evidence to require the sub-
mission of that issue to the jury.
It is not clear to us whether plaintiffs characterize the
1972 high bid agreement as a bilateral contract or a uni-
lateral contract, or whether they rely on an estoppel theory
of induced reliance. But no matter how classified, the
same issue is presented as to whether the 1972 agreement
embraced the 1973 bidding, at least as to the high bid as-
surance. We proceed to consider seriatim the evidence
which plaintiffs contend created a jury issue as to the
1973 bidding.
The plaintiffs emphasize that the only two bidders in
1972 were metal dealers, not real estate brokers. They
say this shows that defendant knew that the real value of
the assets was in the metals which alone were the subject
of the 1973 bidding. This appears to be the only 1972
evidence offered by plaintiffs in support of their contention
that the parties intended this high bid agreement to be
Appendix A A7
effective until the metal was sold. Such evidence is neutral
at best as to the parties’ intent with respect to the duration
of the oral assurance to award the contract to the original
high bidder.
Plaintiffs next point to several pieces of evidence con-
sisting of events occurring in 1973 which, they contend,
justified the submission of the intention issue to the jury:
1. In 1973, after defendant had decided to donate the
real estate to the community, Kline informed another em-
ployee of defendant, one Bisio, of the high bid assurance
Kline had given Sitkin in 1972.
2. When Kline met with Sitkin numerous times in
1973 concerning the sale of the scrap, Kline never informed
Sitkin that the 1972 high bid assurance was inoperative.
3. Communications to Sitkin concerning bidding in
1973 came from Kline or through his direction.
4, Both the July, 1973, communication and the Sep-
tember, 1973, invitation to bid confirmed the 1972 high bid
assurance. Plaintiffs so conclude because the communica-
tion stated “not subject to escalation,” and because the
invitation stated that “no revision of bids will be accepted
. ; your best price must be submitted first.”
5. The secretiveness of defendant in its dealings with
Krentzman in 1973 exhibited an awareness of a mutual
intent in 1972 that the 1972 high bid commitment extend
to any awarding of the contract, and thus to the 1973
bidding.
6. The manner in which defendant actually tried to
lower plaintiffs’ bid evidenced its recognition that if plain-
tiffs were the highest bidder an obligation existed in 1973
to award the contract to them under the terms of the 1972
oral assurances.
A8 Appendix A
7. Kline acknowledged plaintiffs’ duration claim when
he visited Sitkin in 1973 after the contract had been
awarded to Krentzman by advising Sitkin that he felt a
“responsibility” to see that Sitkin was given a “fair shake
all the way down the line.”
With the possible exception of number 1, all the 1973
“evidence” relied upon by plaintiffs, much of which is
argument, is neutral at best. It lacked the definiteness
that would permit a reasonable inference, as opposed to a
guess, that it reflected an intention with respect to the
extent of the 1972 high bid assurance. This is particularly
true when we recall that the burden rested on plaintiffs.
We note in this regard that though plaintiffs argue that
the 1972 high bid assurance had been given to Sitkin as the
president of one of the plaintiff companies, Sitkin himself
never testified that he believed that the 1972 high bid as-
surance carried over to the 1973 bidding.
As to number 1, the 1973 conversation when Kline in-
formed Bisio of the 1972 assurances, the fact of such a
conversation does not tend to prove that the parties had an
intent in 1972 that the high bid assurance would continue
beyond the particular bid which followed the 1972 assur-
ances. Of more importance, plaintiffs’ own bid terminated
by its terms on October 20, 1972. To this may be added the
evidence that the 1972 bids were limited as to participants
and differed substantially as to subject matter from the
1973 bid.
Finally, plaintiffs claim they were entitled to receive
the contract in 1973 because under the continued 1972 high
bid assurance they were the high bidder. Yet the evidence
shows that the elaborate document soliciting the 1973 bids
explicitly provided that the defendant reserved the right to
reject any or all bids. This provision is flatly inconsistent
with the 1972 assurance that if plaintiffs submitted the
Appendix A AQ
high bid it would be accepted. Thus, the very documenta-
tion which prompted plaintiffs’ 1973 bid is inconsistent
with an intent that the 1972 high bid assurance would
apply until the scrap was sold.
We therefore conclude that whether plaintiff's evi-
dence is viewed singly or cumulatively, it was insufficient
as a matter of law to create a jury issue as to whether the
1972 high bid assurance was intended to apply to the 1973
bidding. Plaintiffs therefore were not entitled to recover
on their contract claim.
II. THe SHERMAN Act CLAIM
Plaintiffs urge this court to reinstate the antitrust
award on the theory that the defendant conspired with
Krentzman to engage in “sham bidding,” which they claim
constitutes a per se violation of § 1 of the Sherman Act.
Although it is not clear from their briefs, we assume
plaintiffs are arguing, alternatively, that the agreement
violated § 1 of the Sherman Act under the “rule of reason”
standard. The district judge granted defendant’s motion
for judgment n.o.v. on the antitrust claim, believing that
the complained of practices, though “reprehensible and
deceitful,” did not violate § 1 of the Sherman Act. De-
fendant urges affirmance of the district court’s disposition
of this claim.
Section 1 of the Sherman Act declares illegal “[e]very
contract, combination . . . or conspiracy, in restraint of
trade or commerce among the several states.” 15 U. S. C.
§1 (1970). We must, in the first instance, determine
whether the jury was justified in finding that a contract
combination or conspiracy existed between defendant and
Krentzman, and, if so, whether it was “in restraint of
trade.” Defendant denies that any conspiracy existed be-
tween it and Krentzman. The jury found otherwise.
Al0 Appendix A
We believe the jury was entitled under the evidence
to conclude that defendant secretly agreed with Krentz-
man in advance of the 1973 bidding to give Krentzman the
opportunity to match the highest bid received in the bid-
ding process and, if Krentzman matched such bid, to award
Krentzman the contract. While such an agreement can be
said to have made a sham of the bidding, it is clear that
we are not talking about sham bidding in the common
parlance, where a bidder drives up the sale price without
any intention of buying. We understand plaintiffs to be
referring to sham bidding in the sense that one bidder was
preordained to obtain the contract if that bidder would
match the high bid submitted. Having established the
fact of an agreement, we proceed to consider whether said
agreement was “in restraint of trade.”
On its face §1 of the Sherman Act prohibits every
contract, combination, or conspiracy in restraint of trade.
Since every agreement concerning trade restrains trade
in some sense, the courts have construed § | as precluding
only those contracts or combinations which unreasonably
restrain competition. Northern Pacific Ry. v. United
States, 356 U. S. i, 5 (1958).
As the Supreme Court has recently pointed out in
Continental T. V., Inc. v. GTE Sylvania, Inc., 433 U. S. 36
(1977), the prevailing standard of analysis under the Sher-
man Act is the rule of reason. The rule of reason requires
the fact-finder to weigh all circumstances of the case in
deciding whether a practice should be condemned because
it unreasonably restrains trade. Certain relationships,
however, are considered to be in violation of the Sherman
Act without regard to any consideration of their reason-
ableness.
The per se category of antitrust violations is made up
of “agreements or practices which because of their perni-
=
Appendix A All
cious effect on competition and lack of any redeeming
virtue are conclusively presumed to be unreasonable and
therefore illegal without elaborate inquiry as to the precise
harm they have caused or the business excuse for their use.”
Northern Pacific Ry. v. United States, 356 U.S. 1,5 (1958).
Courts must appraise the market impact of practices chal-
lenged on the grounds they are violative of the Sherman
Act unless there is a per se violation. Since a per se viola-
tion is conclusively presumed to be unreasonable, no trial
is necessary to show the nature, extent, and degree of the
market effect of the practice. White Motor Co. v. United
States, 372 U. S. 253 (1963).
While plaintiffs contend that the agreement was per
se violative of § 1, it is difficult to isolate any specific fac-
tors relied upon by them which would allow us to support
their contention. They argue that the agreement amounted
to price-fixing, a practice widely acknowledged to be a per
se violation of the Sherman Act. The price fixing within
the scope of the per se prohibition of § 1, however, is an
agreement to fix the price to be charged in transactions
with third parties, not between the contracting parties
themselves. Thus, in United States v. General Motors
Corp., 384 U. S. 127 (1966), a case involving horizontal
price fixing upon which plaintiffs place some reliance, the
purpose of the concerted refusal to deal was to eliminate
discounters and thus raise the price of Chevrolets in trans-
actions with consumers, who were third parties, not in
transactions between the co-conspirators themselves. In
vertical price fixing cases, the prices fixed are resale prices
charged to third parties and not the price between the
conspiring parties themselves. See United States v. Parke,
Davis & Co., 362 U. S. 29 (1960); Pitchford v. Pepi, Inc.,
531 F. 2d 92 (3d Cir. 1975), cert. denied, 426 U. S. 935
(1976). Thus, the factual foundation for plaintiffs’ per
se price fixing violation is absent here.
Al2 Appendix A
Plaintiffs also assert that the sham bidding conspiracy
constituted a concerted refusal to deal, and constituted a
per se violation as a group boycott. Accordingly, we have
reviewed the significant cases in which the Supreme Court
has examined the group boycott and concerted refusal to
deal concepts. The controlling cases involve broad com-
binations and rather pervasive refusals to deal by a group
of suppliers covering many transactions over an extended
period of time. Klor’s Inc. v. Broadway-Hale Stores, Inc.,
359 U. S. 207 (1959); Fashion Originators’ Guild of Amer-
ica, Inc. v. F. T. C., 312 U. S. 457 (1941); Eastern States
Retail Lumber Dealers’ Ass'n v. United States, 234 U. S.
600 (1914). We are not confronted with such a factual
situation here.
Plaintiffs have not brought to our attention any case
where a court has found a per se violation of the Sherman
Act on the basis of a concerted refusal to deal between a
single seller and a single buyer. We are reminded of this
Court's admonition in DeFillipo v. Ford Motor Co., 516
F. 2d 1313 (3d Cir.), cert. denied, 423 U. S. 912 (1975),
that “‘[t]he term “group boycott” . . . is in reality a very
broad label for divergent types of concerted activity. To
outlaw certain types of business conduct merely by attach-
ing the “group boycott” and “pe se” labels obviously
invites the chance that certain types of reasonable con-
certed activity will be proscribed.’” Id. at 1317-18, quot-
ing Worthen Bank & Trust Co. v. National Bank Ameri-
card, Inc., 485 F. 2d 119, 125 (8th Cir. 1973), cert. denied,
415 U. S. 918 (1974).
The mere existence of sham. bidding, as that term is
used by plaintiffs, in our view does not create a presump-
tive violation of the Sherman Act. We do not find it so
anticompetitive that the court routinely should allow a
party to invoke the per se rule and thereby avoid the need
ded et
Appendix A Al3
to show its affect on commerce in each case. As the Su-
preme Court has said: “It is only after considerable ex-
perience with certain business relationships that courts
classify them as per se violations of the Sherman Act.”
United States v. Topco Associates, 405 U. S. 596, 607-08
(1971). The so-called sham bidding arrangement here
does not fulfill the gloss placed on the statute by the
Supreme Court.
Turning to the rule of reason standard, we similarly
are unable to conclude that plaintiffs have shown a viola-
tion. The standard of reasonableness is “the measure
used for the purpose of determining whether, in a given
case, a particular act had or had not brought about the
wrong against which the statute provided.” Standard Oil
Co. of New Jersey v. United States, 221 U. S. 1, 60 (1911).
The basic principle of the rule of reason, well articulated
in Chicago Board of Trade v. United States, 246 U. S. 231
(1918), is that contractual restraints fall within the prohi-
bition of § 1 only when their purpose and effect is found
to have imposed an undue restraint on commerce.
Regarding the purpose for the agreement, it was sug-
gested in the argument on this appeal that the purpose of
the “scheme” was to arrive at a purchase price not able
to be agreed upon otherwise. This seems to us to be the
most logical of the purposes which might be suggested.
The parties seemingly desired to find the market price,
rather than influence the market price. Likewise, there
was no evidence of an intent to affect quantity or quality
of any goods or services. With regard to the effect of the
combination, no evidence is presented by plaintiffs which
suggests that prices, quantity or quality in the scrap metal
market were influenced by the combination. Nothing in
the record indicates any material diminution in the exist-
ing competition for scrap.
Al4 Appendix A
All but one of the bidders were destined to come up
“empty-handed” with or without the sham bidding. The
agreement gave a preference to Krentzman. A, manufac-
turer or trader, however, is free to choose the customers
to whom it wishes to sell so long as its conduct has no
market control or monopolistic purpose or effect. Times-
Picayune Publishing Co. v. United States, 345 U. S. 594
(1953); Reed Brothers, Inc. v. Monsanto Company, 525
F. 2d 486 (8th Cir. 1975), cert. denied, 423 U. S. 1055
(1976).
Defendant's right to exercise this free choice is not
limited because of the “sham” and the “sham” does not
render the exercise of the choice a violation of the Sher-
man Act. Conduct not within the scope of the Act is not
made into an antitrust violation by accompanying conduct
which is reprehensible under some moral or ethical stand-
ard ox even illegal under some other law.
[T]he use of conventional antitrust language . . . will
not extend the reach of the Sherman Act to wrongs
not germane to that act.... The antitrust laws were
never meant to be a panacea for ail wrongs.
Parmelee Transp. Co. v. Keeshin, 292 F. 2d 794, 804 (7th
Cir.), cert. denied, 368 U. S. 944 (1961).
In applying the rule of reason standard, courts are
called upon to judge shades and gradations of competitive
impact. The standard for determining what combinations
involve the prohibited degree of harm is nowhere spelled
out in specific terms. It is clear, however, that plaintiffs
have a burden to show more than a de minimus restraint.
As Justice Frankfurter pointed out in his concurring opin-
ion in Associated Press v. United States, 326 U. S. 1 (1945):
[E]ver since the Sherman Law was saved from stifling
literalness by ‘the rule of reason’ it is not sufficient to
Appendix A Al5
find a restraint. The decisive question is whether it
is an unreasonable restraint.
Id. at 27 (Frankfurter, J., concurring) (citations omitted ).
The Sherman Act “was deigned to prevent restraints of
trade which [have] a significant effect on . . . competi-
tion.” Apex Hosiery Co. v. Leader, 310 U. S. 469, 493
n. 15, (1940). Plaintiffs have not met their burden to show
how competition was restrained significantly. They have
made conclusive statements regarding the harmful effects
of the questioned combination, but have provided us with
no analysis with which to conclude that defendant has
been a party to an unreasonable restraint. In reviewing
their claim, we consider the facts rather than “incendiary,
yet vague charges” characterizing those facts. Automatic
Radio Mfg. Co. v. Hazeltine Research, Inc., 339 U. S. 827,
834 (1950).
Plaintiffs have not maintained their burden to show
that the combination in any substantial way either did or
could affect interstate commerce by controlling market
prices, imposing undue limitations on competitive condi-
tions, or unreasonably restricting competitive opportunity.
These are the kinds of practices the Sherman Act was en-
acted to prohibit. Apex Hosiery Co., supra, at 493. Ap-
plying the rule of reason, we cannot conclude that the
practices objected to in the instant case tend to, or actually
do, restrain trade so at to violate the Sherman Act.
Plaintiffs’ briefs devote much attention to various evils
resulting from the scheme promulgated by defendant. We
think that application of the Sherman Act to the present
facts would be contrary to the rule of reason standard.
As one court declared, “the Sherman Act is neither a
lowest—responsible—bidder statute nor a panacea for all
business affronts which seem to fit nowhere else.” Scran-
Al6 Appendix A
ton Construction Co. v. Litton Industries Leasing Corp.,
494 F. 2d 778, 783 (5th Cir. 1974), cert. denied, 419 U. S.
1105 (1975). The Sherman Act plays a vital, central role
in our economic system. It has been described as the
“Magna Carta of free enterprise . . . as important to the
preservation of economic freedom and our free-enterprise
system as the Bill of Rights is to the protection of our
fundamental personal freedoms.” United States v. Topco
Associates, Inc., supra, at 610. But just as the Bill of
Rights cannot be invoked to protect individual citizens
from all forms of personal affront, the Sherman Act can-
not proscribe all unseemly business practices. The manip-
ulation of the bids of businessmen, as evidenced in the
case at bar, was clearly reprehensible. Nonetheless, the
Sherman Act may not be extended beyond its intended
scope and used to police the morals of the marketplace.
In view of our determinations, we need not address
defendant's request for a new trial.
The judgment of the district court on the contract
claim will be reversed.
The judgment of the district court on the Sherman
Act claim will be affirmed.
Gusons, Circuit Judge, dissenting
Because my brothers in the majority have, with re-
spect to the contract claim, usurped the proper function
of the jury and, with respect to the antitrust claim, mis-
stated the governing law, I respectfully dissent.
I. THe Contract CLAIM
The theory of plaintiff, Sitkin Smelting and Refining
Co., Inc., carefully set out in Judge Van Artsdalen’s charge
Appendix A Al7
to the jury, was that Charles Kline acting for FMC Corp.
promised in 1972 that, if Sitkin would bid on the FMC
plant, FMC (1) would not use Sitkin’s bid to negotiate
higher bids from other bidders and (2) would, if it ac-
cepted any bid, accept the highest bid. The court ex-
pressly charged:
It is only in the event that you find that FMC made
the definite promise to Sitkin in respect to the 1972
bidding for the purchase of the entire plant, which
promises remained in effect by agreement and assent
of the parties in respect to the bidding that took place
in 1973. And it could only be on that basis that the
plaintiffs could establish any contract between FMC
and plaintiffs in regard to the facts of this case.
App. 618. This charge—that in order for Sitkin to recover,
the jury must find that the 1972 promises remained in ef-
fect in 1973—was repeated several times. Judge Van Arts-
dalen reviewed the evidence for the jury and pointed out
that the testimony on the intention of the parties was con-
flicting. Given the conflict, he denied FMC’s motion for
a directed verdict, pursuant to Fed. R. Civ. P. 50(a), and
left the issue to the jury on special interrogatories. Before
it could return a verdict for Sitkin on the contract claim,
it had to—and did—answer the following questions in the
affirmative:
1. Did FMC Corporation and Sitkin Smelting &
Refining Co., Inc., through authorized agents, enter
into a contract in 1972 wherein they mutually agreed
that if Sitkin Smelting & Refining Co., Inc. made a
bid to purchase FMC Corporation’s Lewistown plant
in its entirety, including real estate, FMC Corporation
(a) would not disclose such bid to any other
bidder? Yes
Al8 Appendix A
(b) would not use such bid to negotiate higher
bids from other bidders? Yes
(c) would, if it accepted any bid, accept the
highest and best bid? Yes
2. If any part of No. l(a), (b) or (c), is an-
swered Yes, did the same terms and conditions as
found to exist in the Answer to Interrogatory No. 1
above apply to the bid submitted by Sitkin Smelting
& Refining Co., Inc., on behalf of itself and jointly
with Monongahela Iron and Metal Co., Inc., in 1973
for the dismantling of FMC Corporation’s Lewis-
town plant, in response to the invitations to bid in
accordance with specifications prepared by FMC Cor-
poration? Yes
When, after the verdict, FMC moved for judgment not-
withstanding the verdict, pursuant to Fed. R. Civ. P.
50(b), Judge Van Artsdalen denied the motion, saying
“[a] careful review of the xecord . . . convinces me that
... there was more than sufficient credible evidence upon
which the jury could properly base its findings contained
in the answers to written interrogatories ....” App. 735.
The majority’s concedes that there is ample evidence
to support the jury’s answer to Interrogatory No. 1. Thus
we, as a reviewing court, are bound to accept the fact that
FMC made the three promises listed in that question. A
contract came into being in 1972. Interrogatory No. 2 is
concerned, not with its existence, but with its duration and
terms. Both depended on the intention of the parties. The
majority says that the evidence on duration “lacked the
definiteness that would permit a reasonable inference, as
opposed to a guess, that it reflected an intention with
respect to the extent of the 1972 high bid assurance.”
Appendix A A19
Supra, p. 7. The difficulty with this position is that a con-
tract of some duration is acknowledged to have come into
existence. It is no less speculative to accept FMC’s ver-
sion than Sitkin’s. !
The testimony of the two men who negotiated the
contract, Lewis Sitkin (for Sitkin) and Charles Kline (for
FMC), reveals no express reference to duration. Inten-
tion concerning duration must have been determined from
the surrounding circumstances. The majority holds as a
matter of law that no fact finder could find that the prom-
ises listed in Interrogatory No. 1 survived FMC’s rejec-
tion of the 1972 bids. Plainly that is not so. If, for
example, immediately following the rejection of the 1972
bids FMC had taken Sitkin’s bid to a third party and
used it to fix the price for a negotiated sale of the plant,
such disclosure would have been a breach of contract.
This result is unaffected by the fact, relied on by the ma-
jority, that Sitkin’s 1972 bid expired on October 20, 1972.
The parties to the contract certainly did not contemplate
that on October 21, 1972, FMC could disclose Sitkin’s bid
to a third party and negotiate a private sale. Having found
the 1972 contract, a fact finder could—indeed, must—
conclude that some of its covenants extended beyond
October, 1972.
Which covenants extended beyond that date? Clearly
not the undertaking to accept the highest bid, says the
majority, because the 1973 solicitation explicitly reserved
the right to reject all bids. The short answer to that argu-
ment is: so did the 1972 solicitation. The covenant on
which Sitkin relies bound FMC to accept the highest bid
if it accepted any bid. The majority's observation that
“the very documentation which prompted plaintiffs’ 1973
bid is inconsistent with an intent that the 1972 high bid
assurance would apply until the scrap was sold,” supra,
A20 Appendix A
p. 8, is tortured reasoning in light of the actual covenant.
Had no sale taken place, Sitken would have had no claim.
But a bid was accepted, and if, as the jury held, the cove-
nant to accept the highest bid was still binding, then Sitkin
did have a claim.
There is evidence that Kline informed Attilio Bisio,
who was hired by FMC in March, 1973, and assigned the
job of disposing of the plant, about the 1972 agreement
with Sitkin. Specifically, Kline told Bisio that he had
promised Sitkin, that the latter’s bid would not be dis-
closed and that, if any bid was accepted, it would be the
highest bid. Kline told Bisio, in other words, the contract
terms which the jury found in Interrogatory No. 1. A
reasonable man could conclude that Kline was not engag-
ing in idle conversation but was briefing the man now in
charge of disposing of the plant on the contractual limita-
tions within which he had to operate. Had Kline under-
stood in 1973 that the 1972 undertakings were no longer
binding, he would have had little or no reason to brief Bisio
on them—at least a reasonable man could so conclude.
There is also evidence that after the 1973 bidding
Kline acknowledged a special responsibility to Sitkin— “a
responsibility to be sure that he had been given an abso-
lutely, completely fair shake all the way down the line,”
App. 434. This special responsibility toward Sitkin (un-
like other bidders) is evidenced by the special treatment
accorded Sitkin’s 1973 bid and by the personal visit paid
to Lewis Sitkin to inform him that his bid had been
rejected.
In addition to the evidence of FMC dealings with Sit-
kin is the evidence of its secret 1973 contracts with Krentz-
man, the favored bidder. What need for secrecy if FMC
had no contractual obligation to Sitkin? A reasonable man
could conclude that it evidenced the continuing effect of
Appendix A A21
the 1972 undertakings. A reasonable jury did so conclude.
The majority rejects all this 1973 evidence as not tending
to prove the intent of the parties in 1972. By so doing, it
substitutes its own evaluation of the evidence for that of
the jury. Like the trial judge who heard the testimony
and observed the demeanor of Kline, Bisio, and Sitkin, I
conclude that the jury was properly asked Interrogatory
No. 2 and that its verdict should not be disturbed.
Il. Tue ANTITRUST CLAIM
A complaint alleging a conspiracy to deprive a com-
petitor of the benefits of a lawful contract in or affecting
interstate commerce by unlawful means states a valid anti-
trust claim. As summarized by the majority in this case,
Sitkin’s complaint charged a conspiracy “to commit two
per se violations of the antitrust laws: an illegal boycott
and price fixing.” Supra, p. 2. In the first place, this is
not a fair characterization of Count II of plaintiffs’ com-
plaint. In fact, that count charges:
Count II
17. The foregoing constitutes a contract, combi-
nation and conspiracy in restraint of trade, in viola-
tion of Section 1 of the Sherman Act, 15 U. S. C. § 1.
App. 9. The “foregoing” to which it refers is the factual
recitation that FMC and Krentzman secretly and frandu-
lently conspired with each other to obtain and use Sitkin’s
bid and to deprive Sitkin of the benefits of the contract
which resulted when it submitted the high bid. From the
jury’s findings, it is clear that there was just such a con-
ae is true that at trial Sitkin analogized what had
transpired to group boycott and price fixing, but its plead-
A22 Appendix A
ings did not commit it to any precise category of per se
violation. The point it made was that the conspiracy,
which everyone agreed affected commerce, had no lawful
purpose whatsoever and resulted in the destruction of
genuine competition. This was not a case in which reli-
ance on a per se rule was required because no reasonable
justification could have been tendered for the immoral
conduct found by the jury. None was, in fact, tendered;
instead, FMC denied the existence of the conspiracy. The
jury, however, found otherwise.
My difference with the majority on the antitrust claim
is fundamental. The majority starts with a search for a
per se category into which the conspiracy might fit; find-
ing none, it proceeds to examine the substantiality of the
effect upon competition. I start, as Judge Taft did in
United States v. Addyston Pipe & Steel Co., 85 F. 271 (6th
Cir. 1898), modified and aff'd, 175 U. S. 211 (1899), by
searching for a lawful main purpose. If a lawful main
purpose for a combination or agreement producing a re-
straint can be identified, I proceed to inquire whether its
effect upon competition is such that it can be called rea-
sonable. But if, as here, no one can identify any lawful
purpose for the combination or agreement and if, as here,
the resulting restraint affects interstate commerce, then a
search for per se categories and an inquiry into the sub-
stantiality of effect are not required. A conspiracy that
would be unlawful at common law—and I have little
doubt about the unlawfulness of this one—must, if it af-
fects interstate commerce sufficiently for federal jurisdic-
tional purposes, violate the Sherman Act.
Moreover, even if there were no such contract as the
jury found, there certainly was a solicitation of bids and a
conspiracy to deprive bidders not only of the cost of pre-
paring those bids but also of the valuable trade informa-
Appendix A A23
tion contained therein. That conspiracy injured every
bidder (except Krentzman) in its business or property to
the extent of such cost and the value of such information.
Being unable to conjure up a lawful purpose for a fake
auction and recognizing that this fake auction was con-
ducted in interstate commerce. I would find a Sherman
Act violation even without the contract. Without the con-
tract, of course, the amount of damages would be different.
The majority responds that, although manipulation of
the bids of businessmen is “clearly reprehensible,” the
Sherman Act may not be used “to police the morals of the
marketplace.” Supra, p. 14. I had thought, until today,
that policing the morals of the interstate marketplace was
exactly what Senator Sherman had in mind. A conspiracy
to conduct a fake auction in the auction market for se-
curities conducted by our national securities exchanges,
for example, was surely within his contemplation.
III. CoNcLUSION
The jury found that there was a breach of contract
which was the result of a conspiracy. It found damages in
the amount of $700,000. Under Section 4 of the Clayton
Act the recovery is three times actual damages. I would
affirm the judgment on the contract claim and reverse the
judgment on the antitrust claim.
A24 Appendix B
APPENDIX RB
IN THE
UNITED STATES DISTRICT COURT
For THE EASTERN Districr OF PENNSYLVANIA
Civil Action No. 74-798
SITKIN SMELTING & REFINING CO., INC., et al.
v.
FMC CORPORATION
Memorandum Opinion and Order
VANARTSDALEN, J. October 28, 1976
Plaintiffs sued for breach of contract and sought treble
damages for a claimed Sherman § 1 antitrust conspiracy.
The jury found liability on both the breach of contract ac-
tion and the antitrust action and determined plaintiff's
damages to be $700,000.00. Damages were tripled for the
antitrust claim and judgment was entered for $2,100,000.00.
Defendant has moved for judgment n.o.v. on both the con-
tract and antitrust claims, and alternatively for a new trial.
The motion for judgment n.o.v. will be granted as to the
antitrust claim, and the judgment will be entered in favor of
plaintiffs and against defendant in the amount of $700,000
on the breach of contract claim. The motion for a new
trial will be denied.
Appendix B A25
Defendant, FMC Corporation (FMC), owned a large
manufacturing facility in Lewistown, Pennsylvania. In the
summer of 1972, the facility was extensively damaged by
the devastating hurricane “Agnes.” Thereafter, FMC de-
cided to close the plant and to sell or otherwise dispose of
the tangible physical assets it no longer wished to retain.
In addition to the land and buildings, there was a large
quantity of salvageable scrap metal, machinery, equipment
and inventory having a substantial valve. Initially, FMC
sought bids for the purchase of the entire plant, including
the real estate.
Joseph Krentzman and Sons (Krentzman) was a local —
scrap and salvage metal dealer who previously had busi-
ness dealings with FMC in purchasing and/or disposing of
scrap and excess or obsolete equipment of the Lewistown
plant. Sitkin Smelting and Refining Co., Inc. (Sitkin), was
a local competitor of Krentzman, but had never, previous
to the hurricane, been able to negotiate any business trans-
actions with FMC.
Charles Kline, an authorized employee of FMC, had a
conversation with Lewis Sitkin, President of Sitkin, after
the hurricane in 1972, concerning a possible bid by Sitkin
to purchase the entire Lewistown plant. The exact con-
versation was in dispute and therefore it was for the jury’s
determination. According to the plaintiff, Mr. Sitkin ex-
pressed apprehension that he might just be “spinning his
wheels” and wasting a lot of time and effort in proposing
a bid, because Sitkin had never previously been given any
consideration in its attempts to do business with FMC.
Mr. Kline then made definite oral assurances to the effect
that the sale of the plant was to be on a strictly competitive
bidding basis and if his bid was the highest and the plant
was sold, he would get the bid. He was assured that the
integrity of the bidding process would be upheld and that
his bid would not be utilized as a bargaining weapon
A26 Appendix B
to obtain a higher bid from Krentzman or anyone else.
Sitkin, in reliance upon Mr. Kline’s assurances, said he
would submit a bid, which, after an extensive examination
of the premises, he subsequently did. Mr. Kline’s testi-
mony did not dispute the general substance of the con-
versation. However, the defendant does dispute the legal
significance of that conversation. Defendant denies that
the conversation plus the fact that Sitkin later submitted
a bid, constituted, at any time, a binding contract. Subse-
quently, several bids to purchase the entire plant were re-
ceived by FMC including one from Sitkin and another from
Krentzman. After these bids were received, FMC altered
its plans whereby it would donate the real estate, includ-
ing land and buildings to the Miflin County Industrial De-
velopment Authority, and sell only the scrap, machinery,
and other equipment that FMC did not want. The pur-
chaser would be required to dismantle and remove the per-
sonalty purchased according to intricate and detailed spe-
cifications and timing. Because of this change in plans,
FMC decided to invite dealers to bid for the dismantling
and disposal of the property.
In July, 1973, FMC prepared detailed bid documents
that contained various options including possible partici-
pation by FMC in the proceeds of the sale of the property.
Invitations to bid were sent to approximately 50 prospec-
tive bidders throughout the United States. The invitations
contained the usual right to reject any and all bids. They
also stated: “No revision of bids will be accepted after the
bid has been submitted; your best bid must be submitted
first.” Sitkin submitted a bid jointly with the co-plaintiff,
Monongahela Iron and Metal Co., Inc., a demolition expert.
Krentzman also submitted a bid, as did many of the other
invitees. Because of the complicated nature of the bids
with various options and alternate bids, FMC hired an in-
Appendix B A27
dependent expert, Irving Altman, to analyze the bids and
make recommendations to FMC. Thereafter a series of
clarification meetings were separately held with certain of
the apparently more favorable bidders, including Sitkin
and Krentzman. Subsequent to one of these clarification
meetings between FMC and Krentzman, Krentzman sub-
mitted a higher bid which FMC eventually accepted.
Sitkin contended at trial not only that its bid was the high-
est and best before the clarification meetings, but that it
remained so even after Krentzman submitted its revised
second bid.
Sitkin contends that when it agreed to submit a bid
for the entire plant in 1972, on the strength of Mr. Kline’s
assurances, a binding contract was thereupon formed and
remained applicable through and including the 1973 bid-
ding for the dismantling and salvaging of the plant equip-
ment. Sitkin further contends that FMC breached this
contract in several respects when it awarded the salvage
contract to Krentzman who was not the highest and best
bidder. As to damages, Sitkin contends that “but for” the
breach in awarding the contract to Krentzman, the bid
would have gone to Sitkin who would have made a sub-
stantial profit. In answer to special interrogatories, the
jury found that there was such a contract and that it was
breached by FMC.
A careful review of the record and the extensive post-
trial briefs submitted by both parties convinces me that
(1) there was more than sufficient credible evidence upon
which the jury could properly base its findings contained
in the answers to written interrogatories, (2) the evidence
submitted was admissible and (3) the issues were sub-
mitted to the jury on adequate instructions as to the law
applicable to the breach of contract claim. Therefore, the
judgment for the plaintiff in the sum of $700,000 on the
breach of contract claim will remain in force.
A28 Appendix B
The antitrust claim charges that FMC and Krentz-
man conspired with each other whereby they agreed that
Krentzman would be awarded the contract at a price es-
tablished at or very close to the highest and best bid sub-
mitted, and that no competitor of Krentzman would be
awarded the contract. Plaintiff contended that such con-
spiracy effectively foreclosed and “boycotted” all competi-
tion from the market for this valuable contact. In addition,
plaintiff argued that such an agreement constituted a form
of “price-fixing.” There was sufficient credible evidence,
primarily circumstantial, from which a jury could find that
Krentzman and FMC did in fact agree that Krentzman
would receive the contract if it approximately equaled any
submitted bid. There was also sufficient evidence that the
Sitkin bid was the highest and best bid, both as originally
submitted by all parties, and even in comparison with the
contract actually awarded to Krentzman. In addition, the
evidence was sufficient for a finding that the contract was
not awarded on the basis of competitive bidding, that Sit-
kin’s bid was disclosed to Krentzman prior to Krentzman
submitting its final revised bid, and that Sitkin’s bid was
used as a leverage device to obtain a better price from
Krentzman. Whether, assuming these facts, FMC was
guilty of any antitrust violation is the issue to be decided.
A private corporation invites selected contractors to
submit written bids based on detailed specifications for
dismantling and disposing of salvageable material from a
shut-down plant. Secretly, it agrees with one of the in-
vited bidders, that such bidder will be awarded the con-
tract, if any contract is to be awarded, at a price established
by the highest and best bid. That secret agreement is sub-
sequently carried out and the salvage contract awarded
accordingly, despite the fact that another bidder was as-
sured that the bids would be kept secret, that the bids
Appendix B A29
would not be utilized to negotiate higher bids from others,
and that if any contract was awarded, it would be to the
highest and best bidder. Does the bidder who was, in
fact, the highest and best bidder have an action for dam-
ages against the corporation that awarded the bid, for
violation of § 1 of the Sherman Act?
Plaintiff contends that FMC was guilty of two different
per se antitrust violations; namely, a boycott or concerted
refusal to deal, and price fixing. Although the conduct
described in the preceding paragraph, as found by the
jury’s answers to interrogatories, can best be described as
reprehensible, deceitful and fraudulent as to other bidders,
I find no cause that would make such action a violation of
§ 1 of the Sherman Act.
Plaintiff relies strongly on Premier Electrical Con-
struction Company v. Miller-Davis Co., 422 F. 2d 1132
(7th Cir. ), cert. denied, 400 U. S. 828 (1970). In that case
an electrical subcontractor alleged that prior to defendant,
a general contractor, submitting a bid on a substantial gov-
ernment construction project, the plaintiff and defendant
agreed that plaintiff would quote a subcontract price to
defendant substantially less than quotations it would make
to any other prospective general contract bidders, pro-
vided defendant would award plaintiff the subcontract if
defendant obtained the general contract. Defendant was
awarded the contract but gave the electrical subcontract
to another subcontractor who underbid plaintiff. The dis-
trict court dismissed the action on the pleadings holding
that a prior breach of contract action between the parties
decided adversely to plaintiff was res judicata and that
plaintiff was barred under the doctrine of in pari delicto.
The circuit court reversed. In so doing, the court stated:
On the basis of these pleadings the agreement be-
tween Miller-Davis and Premier constitutes a per se
A30 Appendix B
violation of the Sherman Act. By preventing Premier
from submitting bids to other general contractors at
the same prices made available to Miller-Davis, the
agreement constitutes a concerted refusal to deal. [ci-
tations omitted] The general contractors were thereby
denied meaningful access to the market for the Ar-
gonne project contract... [citations omitted] We
also believe the agreement violates the prohibition
against price restraints... [citations omitted] The
intended effect and probable result of the agreement
here was to cause a higher overall price on the Ar-
gonne project contract than would otherwise have
prevailed.
422 F. 2d 1132 at 1137.
The contention in the present case is that FMC and
Krentzman agreed to preclude all other bidders from com-
peting with Krentzman for the contract, thereby fixing the
contract price on a non-free market. The difficulty that I
find with this argument is that there is nothing to prevent
a corporation from agreeing to award a contract to a par-
ticular contractor irrespective of whether others may bid
more or less. Although it may be normally reprehensible
and deceitful to conduct sham competitive bidding in order
to establish the contract price with a contract previously
agreed upon, I do not understand this to be a restraint of
trade within the meaning of § 1 of the Sherman Act. I fail
to see how FMC’s refusal to deal with other contractors,
including Sitkin, is a “concerted” refusal to deal, simply
because FMC agrees that Krentzman will, in effect, have
the option of obtaining the contract if it will do the work
at the price established by the best bid among the com-
petitors.
Certainly there would have been nothing illegal if
FMC had announced, prior to soliciting competing bids,
Appendix B A31
that Krentzman would be the preferred bidder and would
be awarded the contract, if, after the bids were opened,
Krentzman then offered to “meet or beat” the highest bid.
The fact that such option was secretly negotiated might
be sufficient evidence of a conspiracy but sech would not,
in any meaningful way that I can discern, constitute any
restraint on trade or the operation of a free market place.
I see nothing about this transaction, insofar as having any
restraining effect on trade, that would be different from a
secret or undisclosed exclusive dealing contract or a re-
quirements contract whereby a manufacturer sells to but
a single customer.
The antitrust claim was submitted to the jury and in
answering interrogatories the jury made special findings
that there was a conspiracy to refuse to deal with other
bidders and to fix the contract price. A reviewing court
will have the advantage of such findings so that if my in-
terpretation of the scope of the coverage of §1 of the
Sherman Act is too restrictive, the treble damage award
may be reinstated.
Defendant has raised numerous questions concerning
the admission of evidence. A review of the record and
post-trial briefs leads me to conclude that such evidence as
was received over defense objections was proper, had prob-
ative value, and if admissible for a limited purpose was so
received with proper cautionary instructions to the jury
at the time or in the general charge. The newly adopted
rule of evidence were certainly not intended to preclude a
jury from hearing that which to a reasonable, logical mind
would have some probative value in determining a fact
in issue. )
Defendant objected to the introduction into evidence
of the memorandum prepared by Mr. Altman, the expert
employed by FMC to analyze the bids. Although Mr.
Altman was an independent expert, for the purposes of
A32 Appendix B
analyzing the bids, he was an agent of FMC. The memo-
randum expressed certain conclusions as to the various
bids and was highly relevant as to which bid was the high-
est and best bid. In any event, the memorandum could be
received in evidence to establish information which FMC
had available at the time it awarded the contract to Krentz-
man and to rebut FMC’s testimony tending to establish
that Sitkin’s bid was ambiguous and could not be inter-
preted.
On the issue of damages, defendant wanted to show
that for the years 1971 through 1974 inclusive, Sitkin made
relatively low profits on its gross business. This would have
had no probative value in determining what profit Sitkin
would have realized on the FMC contract if it had been
awarded, what all parties concede, should have been a
favorable and profitable contract. Based on participating
proceeds paid to FMC by Krentzman and the terms of the
bid of Sitkin, there was substantial evidence to establish
the amount of the loss of anticipated profits, Whether
Sitkin made a profit or suffered a loss on its general busi-
ness during the years in question was not relevant.
Defendant moved for a mistrial when plaintiff's coun-
sel referred, during cross examination, to a prior civil action
against Krentzman, in violation of a trial ruling. The rul-
ing was made out of an abundance of caution, and it is
doubtful that defendant could validly have objected in the
absence of the ruling. In any event, an immediate and
clear cautionary instruction was given to the jury. Jurors
who are all called upon to determine many complicated
factual issues, should be able to follow a direct instruction.
In any event, I fail to see how a juror would, in this litigious
day and age, be prejudiced against a businessman or a cor-
poration because another business entity had previously
filed a lawsuit against such person or entity.
Appendix B A33
Krentzman, in making the original bid, was one of a
group of partners who subsequently had a disagreement
with the partners. The deposition of one of the partners,
Bert Green, was taken and portions were received in evi-
dence which tended to show that prior to the time Krentz-
man submitted the bid, one or more of the partners was
aware of the Sitkin bid. Defendant argues that this is no
proof that such a bid was disclosed by FMC. However,
this would appear to be a bit circumstantial evidence that
could properly be considered. Further, it tended to con-
tradict evidence by FMC that FMC had revealed the bid
to no one, especially if the jury accepted Sitkin’s testimony
to the effect that he never disclosed the bid to any third
party.
The defendant argues that the jury was not clearly
instructed that even if it should find a breach of contract,
the antitrust claim was independent and separate. I be-
lieve the instructions made this abundantly clear to the
jury, as did the interrogatories. In any event, if my pres-
ent ruling to dismiss the antitrust claim by entering a judg-
ment n.o.v. is correct, then defendant's argument becomes
irrelevant even if otherwise correct. Finally, defendant
now contends that the answers to the interrogatories are
inconsistent with each other. However, defendant does
not contend that it objected, at the time, to these interroga-
tories being submitted. Although the jury found Sitkin’s
bid to be the highest and best bid, defendant consistently
contended it was not. If so, then it is entirely consistent
for the jury to find that the Sitkin bid was utilized by FMC
to obtain an increased bid from Krentzman to whom it
then awarded the bid even though not, in fact, the highest
and best bid then outstanding Plaintiff's entire theory of
the conspiracy is based on the premise that Krentzman was
assured of being awarded the contract provided his bid was
approximately equal to the best bid, regardless of whether
A34 Appendix B
in final analysis it was a little higher or a little lower, but
that the standard whereby the ultimate price would be
established would be the high bid.
This case presented unusual facts. It was, however,
well presented to the jury by very competent and skillful
attorneys who were able to focus the jury’s attention on the
essential facts and issues without undue extraneous mate-
rial. I am convinced that the jury made an impartial and
careful determination and that a new trial is not warranted.
Appendix C A35
APPENDIX C
IN THE
UNITED STATES DISTRICT COURT
For THE EASTERN DIsTRiCT OF PENNSYLVANIA
Civil Action No. 74-798
SITKIN SMELTING & REFINING CO.,, INC., et al.
v,
FMC CORPORATION
Interrogatories to the Jury
We, the jury, find in FAVOR of the plaintiffs (plaintiffs
or defendant) on the issue of liability as to the plaintiffs’
claim for damages for breach of contract by defendant, and
answer the following interrogatories:
1. Did FMC Corporation and Sitkin
Smelting & Refining Co., Inc., through
authorized agents, enter into a contract
in 1972 wherein they mutually agreed
that if Sitkin Smelting & Refining Co.,
Inc., made a bid to purchase FMC Cor-
poration’s Lewistown plant in its en-
tirety, including real estate, FMC Cor-
poration
(a) would not disclose such bid to
any other bidder? YES X NO |
(b) would not use such bid to
negotiate higher bids from
other bidders? YES X NO
A36 Appendix C Appendix C A37
(c) would, if it accepted any bid, from another bidder or other
accept the highest and best bidders? YES X NO
bid? YES X NO as jail
— — (c) award the bid to a bidder
2. If any part of No. 1 [(a) (b) or other than the highest and best
(c)], is answered YES, did the same bid submitted in compliance
terms and conditions as found to exist with the specifications? YES X NO
in the Answer to Interrogatory No. 1
above apply to the bid submitted by
Sitkin Smelting & Refining Co., Inc., on
behalf of itself and jointly with Monon-
gahela Iron and Metal Co., Inc., in 1973
for the dismantling of FMC Corpora-
tion’s Lewistown plant, in response to
the invitations to bid in accordance with
5. If any part of No. 4 is answered
YES [(a), (b) or (c)], did the joint
bid submitted by Sitkin Smelting &
Refining Co., Inc., in 1973 for the dis-
mantling of FMC Corporation’s Lewis-
town plant comply with the specifica-
tions prepared by FMC Corporation? YES X NO
specifications prepared by FMC Cor- (a) Was it the highest and best
poration? YES X NO bid submitted by any bidder
3. If No. 2 is answered YES, did a 108 ay _ pee
FMC Corporation breach such contract Oe
with Sitkin Smelting & Refining Co., Inc. meeting with any bidder? eA RO
in respect to the 1973 bid for the dis- (b) Was it the highest and best
mantling of FMC Corporation’s Lewis- bid submitted by any bidder
town plant? YES X NO at any time? YES X NO |
4. If No. 3 is answered YES, did We, the jury, further find in FAVOR
FMC Corporation, in breach of such
contract with Sitkin Smelting & Refining
Co., Inc.,
(a) disclose the joint bid of Sitkin
Smelting & Refining Co., Inc.,
and Monongahela Iron and
Metal Co., Inc. to another bid-
der or bidders?
(b) utilize such joint bid to nego-
tiate a higher bid or bids
YES X NO |
of the plaintiffs (plaintiffs or defend-
ant) on the Anti-Trust claim for violat-
ing Section 1 of the Sherman Anti-Trust
Act, and answer the following inter-
rogatories:
6. Did FMC Corporation enter into
any unlawful contract, combination or
conspiracy with Joseph Krentzman and
Sons whereby Sitkin Smelting & Refining
Co., Inc., and any and all other bidders
except Joseph Krentzman and Sons
=a
{
A38 Appendix C
would be excluded from being awarded
the contract to dismantle FMC Cor-
poration’s Lewistown plant irrespective
of any bids that might be submitted? YES X NO _
7. Did FMC Corporation enter into
any unlawful contract, combination or
conspiracy with Joseph Krentzman and
Sons whereby Joseph Krentzman and
Sons would be awarded the contract to
dismantle FMC Corporation's Lewis-
town plant at a price that would be set
and fixed by the highest and best bid
of all the bidders, if any contract was
awarded? YES X NO |
ANSWER THE FOLLOWING
INTERROGATORY NO. 8 only if you
have found in FAVOR of plaintiffs on
the issue of liability as to either or both
the breach of contract claim and/or the
anti-trust claim.
- a i a
ON Ae ee ce Oe atte «A ebes”.
8. In what amount do you find |
plaintiffs to have been damaged? $700,000.00
~~ —
alae re
et le a
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.