Opposition — Wilmorite, Inc. v. Eagan Real Estate, Inc.

Supreme Court of the United States

Fa Supreme Court, U. $~

IN THE FILED

October Term, 1978

NOV 2 1978

4

MIGH, AN) A

No. 78-525 __MIGHAEL RED K, JR., CLERK

WiILMoriteE, INc., FAYETTEVILLE PLAZA, INC. and

James P. Witsor, d/b/a Fayerrevitie MALL,

Petitioners,

vu.

IAGAN REAL Estate, INc., EAGAN REAL Estate MANAGEMENT

Corp., EAGAN Reat Estate, Leo T. EAGAN, WILLIAM EAGAN,

EDWARD EAGAN, Kimprook REALTY, Kimprook Corp., CFB De-

VELOPMENT CorpP,, CAMPERLINO AND Ifartrit BuILpers, INC., FRANK

atti, WILLIAM J, CAMPERLINO, WILLIAM A. BARGABOs, PYRAMID

DEVELOPMENT, INC., PYRAMID BROKERAGE COMPANY, INC., MICHAEL

FALCONE, ALLIED StTorRES CorvoraAtTion, Dey BroruerRs AND Co,

Inc., WINMAR CoMPANY, INC., BARNEY Deasy, PAUL D. LONERGAN,

KATHERINE M, Sues, JouN Murpity, EArt Oor, Kocer Smiru,

ARTHUR REED and Davip C, Murray,

Respondents.

BRIEF IN OPPOSITION TO PETITION FOR

CERTIORARI OF WILMORITE, INC. ET AL.

FILED ON BEHALF OF

EAGAN REAL ESTATE, INC., EAGAN REAL ESTATE

MANAGEMENT CORP., EAGAN REAL ESTATE, LEO

T. EAGAN, WILLIAM EAGAN, EDWARD EAGAN,

KIMBROOK CORP., PAUL D, LONERGAN, KATHERINE

M. SHEA and JOHN MURPHY

Simon H. RirKinp

Attorney for Respondents

Eagan Real Estate, Inc., Eagan Real

Estate Management Corp., Fagan

Real Estate, Leo T, Eagan, William

Eagan, Edward Lagan, Kimbrook

Corp., Paul D. Lonergan, Katherine

M. Shea and John Murphy

345 Park Avenue

New York, New York 10022

(212) 644-8602

Pau, Weiss, Rirkinp, Wiarton & Garrison

Marx H, Axcorr

NEAL JOHNSTON

Of Counsel

TABLE OF CONTENTS

Statement of the Case

Proceedings Below

I—The entry of summary judgment does not merit

further review because respondents’ alleged activ-

ities fall squarely within the scope of the Noerr-

Pennington doctrine

Petitioners’ contentions

It is of no relevance that not all respondents were

parties plaintiff in the state court litigations

they assisted

The motives of respondents in assisting the state

court litigants are irrelevant under Noerr-

PCHMNGEON .......600ccercsrseeees

II—Denial of petitioners’ post summary judgment

motion to alter and amend the complaint does not

merit further review since such denial was within

the sound discretion of the trial court

Conclusion

PAGE

10

12

17

19

21

I!

TABLE OF AUTHORITIES

PAGE

Cases:

Abood v. Detroit Bd. of Educ., 431 U.S. 209 (1977) -

‘Adickes v. SH. Kress & Co., 398 U.S. 144 (1970) mee

Adolph Coors Co. v. A&S Wholesalers, Inc., 561 F.2c *

807 (10th Cir. 1977)

Albright, et al. v. Town of Manlius, ef al., 34 A.D.2d

419, 312 N.Y.S.2d 13 (4th Dept. 1970), reversed

98 N.Y.2d 108, 268 N.E.2d 789, 920 N.Y.S.2d 50

(1971) 4

Bencke v. Bd. of Appeals, 51 Misc.2d 20, 273 N.Y.S.2d ;

121 (Sup. Ct., Onondaga Co. 1966)

Bethlehem Plaza v. Campbell, 403 F. Supp. 966 (E.D. ves

2a. 1975 \

Bob pipet aaa Inc. v. Bartel, 504 F.2d 1293 :

(7th Cir. 1974) =

Bracken’s Shopping Center, Ine. v. Ruwe, 273 F. ,

Supp. 606 (S.D. Til. 1967) essai 9,1

Brotherhood of R.R. Trainmen Vv. Virginia ex rel. ;

Virginia State Bar, 377 U.S. 1 (1964) 15

California Motor Transport v. Trucking Unlimited,

404 U.S. 508 (1972) 6, passim

City of Lafayette, La. v. Louisiana Power & Light Co.,

* 435 U.S, 389, 98 S. Ct. 1123 (1978) .

Eastern R.R. Presidents Conf. v. Noerr Motor |

Freight, Inc., 365 U.S. 127 (1961) 2, passim

Ernest W. Hahn, Ine. v. Codding, 428 F. Supp. 913

(N.D. Cal. 1976) 9, 16

First Delaware Valley Citizens Television, Ine. v.

CBS, Inc., 398 F. Supp. 917 (B.D. Pa. 1975) 16

International Union UAW v. National Right to Work

Legal Defense and Edue. Foundation, Inc., 433 .

F. Supp. 474 (D. D.C. 1977) 15, 16

fe a de oe

III

PAGE

Kimbrook Realty v. Onondaga County Planning

Board, New York State Supreme Court decision

filed on Feb. 7, 1977 5

Komie v. Buehler Corp., 449 F.2d 644 (9th Cir. 1971) 20

NAACP vy. Alabama, 357 U.S. 449 (1958) 14, 15

NAACP vy. Button, 371 U.S. 415 (1963) 14

Ohralik v. Ohio State Bar Association, 436 U.S. 447,

98 S. Ct. 1912 (1978) 15

Otter Tail Power Co. v. U.S., 360 F. Supp. 451 (D.

Minn. 1973), aff’d 417 U.S. 901 (1974) 9

Rush-Hampton Indus. v. Home Ventilating Inst., 419

F. Supp. 19 (M.D. Fla. 1976) 16

Semke v. Enid Automobile Dealers Ass’n, 456 F.2d

1361 (10th Cir. 1972) 16

Stern v. United States Gypsum, Inc., 547 F.2d 1329

(7th Cir. 1977) 15

Swan v. Board of Higher Education, 319 F.2d 56 (2d

Cir. 1963) 20

Talley v. California, 362 U.S. 60 (1960) 14

United Mine Workers v. Illinois State Bar Ass’n, 389

U.S. 217 (1967) 15

United Mine Workers v. Pennington, 381 U.S. 657

(1965) 2, passim

United Transp. Union v. State Bar, 401 U.S. 576

(1971) 15

Statutory Sources:

United States:

Sherman Act, “41 & 2, 26 Stat 209 (1890), 15 U.S.C.

S41 & 2 6, passim

Rules:

Federal Rules of Civil Procedure:

Fed. R. Civ. P. 12(b) (6) gee

Fed. R. Civ. P. 59(e) ..

IN THE

Supreme Conrt of the United States

October Term, 1978

No. 78-525

$$

WIcMoriTE, INc., FAYETTEVILLE PLAzA, INC. and

James P. WivLmort, d/b/a FAYETTEVILLE MALL,

Petitioners,

v.

EAGAN REAL Estate, INc., EAGAN REAL EsTATE MANAGEMENT

Corp., EAGAN REAL Estate, Leo T. EAGAN, WILLIAM EAGAN,

Epwarp EAGAN, KIMBROOK REALTY, KimBrookK Corp., CFB Des-

VELOPMENT Corp., CAMPERLINO AND Fatti BuILpERS, INc., FRANK

Fatti, WILLIAM J. CAMPERLINO, WILLIAM A. BARGABOs, PYRAMID

DEVELOPMENT, INC., PYRAMID BROKERAGE COMPANY, INC., MICHAEL

FALCONE, ALLIED STORES CoRPORATION, DEY BROTHERS AND CoO.,

Inc., WiNMAR CoMPANY, INc., BARNEY Deasy, Paut D. LONERGAN,

KATHERINE M. Snea, JOHN Murpny, Eart Oot, RocGer SMITH,

ARTHUR REED and Davip C. Murray,

Respondents.

BRIEF IN OPPOSITION TO PETITION FOR

CERTIORARI OF WILMORITE, INC. ET AL.

FILED ON BEHALF OF

EAGAN REAL ESTATE, INC., EAGAN REAL ESTATE

MANAGEMENT CORP., EAGAN REAL ESTATE, LEO

T. EAGAN, WILLIAM EAGAN, EDWARD EAGAN,

KIMBROOK CORP., PAUL D. LONERGAN, KATHERINE

M. SHEA and JOHN MURPHY

This brief is submitted in opposition to the petition for

a writ of certiorari, filed by petitioners Wilmorite, Inc.

et al., to review the judgment of the United States Court of

Appeals for the Second Circuit entered on June 30, 1978.

2

This is an antitrust action in which interstate real estate

developers seek $72,000,000 in damages because residents

of upstate New York, assisted and encouraged by some

respondents, opposed efforts to construct two large shop-

ping centers in their residentially-zoned neighborhoods by

recourse to the zoning laws. Their opposition consisted

primarily of litigating in court the validity of amendments

to zoning ordinances obtained by petitioners. The petition

for certiorari focuses almost exclusively on this litigation

activity. The complaint also alleged that respondents gen-

erated adverse publicity and promoted opposition to the

ordinances in hearings before local zoning officials.

The courts below held, without dissent, that such ac-

tivity was outside the reach of the antitrust laws, under the

well-established Noerr-Pennington doctrine.’ Accordingly,

summary judgment was entered and the complaint was dis-

missed. The petition for a writ of certiorari offers no rea-

son why this judgment should be reviewed, much less re-

versed. The conduct alleged falls squarely within the

principles of Noerr and Pennington, the lower courts have

consistently applied those principles to such conduct, and

no conflict among the circuits or special circumstances are

suggested. The petition should be denied.

Statement of the Case

Petitioners are owners and developers of regional shop-

ping centers both in and outside of New York State. The

27 named respondents, defendants below, for the most part

are individuals and business entities active in the Syracuse

1. Eastern R. R. Presidents Conf. v. Noerr Motor Freight, Inc.,

365 U.S. 126 (1961) ; United Mine Workers v. Pennington, 381 U.S.

657 (1965).

3

area; they include local real estate developers in competi-

tion with petitioners, their shareholders and employees, a

department store chain, two planning consultants and a

local doctor who headed a citizens committee in opposition

to one of petitioners’ proposed new shopping centers.”

In 1965, petitioners acquired a tract of land in Onon-

daga County (on which they eventually built Fayetteville

Mall Shopping Center). In June of 1965, they obtained a

zoning change from the Town Board and soon thereafter

applied for a building permit which was approved by the

Board of Appeals the very next day. Litigation was

promptly commenced by local citizens challenging the zon-

ing change.

In this first example of what petitioners argued below

was a ‘‘pattern of baseless litigation,’’ the citizens won:

The zoning application had been granted by an improper

procedure and on insufficient data, and the local board of

appeals had exercised discretion beyond its power in affirm-

ing the decision, Beneke v. Bd. of Appeals, 51 Mise. 2d 20,

25, 273 N.Y.S.2d 121, 127 (Sup. Ct. Onondaga Co. 1966).

Petitioners never appealed this adverse decision. Nowhere

in their petition to this Court do petitioners mention this

opening round in the ‘‘multiple repetitive zoning lawsuits.’’

Later, a second proposed zoning ordinance was sub-

mitted, but the Town Board rejected it. Various respond-

ents were involved in marshalling local opposition to that

2. This brief is submitted on behalf of the Eagan group of re-

spondents. They owned and operated shopping centers located near

the two sites petitioners proposed to develop. The Allied respond-

ents were major tenants of the Eagans. The Kimbrook respondents

owned and operated a Planned Unit Development in Northern Onon-

daga County near one of petitioners’ sites and allegedly are controlled

by the Eagans.

4

rejected ordinance, just as they had been involved in the

successful Beneke action.’

Petitioners’ third attempt to obtain zoning relief suc-

ceeded at the legislative level. Promptly, thereafter, 148

area residential property owners commenced an action for

a judgment declaring this rezoning to be invalid. Albright,

et al. v. Town of Manlius, et al. A parallel action, Schaff v.

Town of Manlius, et al., was later commenced seeking sim-

ilar relief; the two actions were then consolidated.

Once again, the citizens prevailed; the trial court held

that the zoning amendments were not in conformity with

a comprehensive plan and that notice precedent to their

enactment. was insufficient. Petitioners appealed to the

State Appellate Division, but the five judges of that court

unanimously affirmed the trial court’s finding that the zon-

ing change was illegal by reason of inadequate notice.

Albright v. Town of Manlius, 34 A.D.2d 419, 312 N.Y.S.2d

13 (4th Dept. 1970).

Petitioners did not prevail until they reached the New

York Court of Appeals, which, by a 4 to 2 vote, held that

notice had been adequate. Albright v. Town of Manlius,

28 N.Y.2d 108, 268 N.E.2d 785, 320 N.Y.S.2d 50 (1971).

Subsequent to this final decision, petitioners proceeded to

construct their Fayetteville Mall.

None of the respondents appeared as parties in any of

these actions, although they did provide the citizen plain-

3. In the Second Circuit, petitioners argued that respondents’ suc-

cessful efforts to oppose the enactment of zoning ordinances were

unlawful under the Sherman Act. That contention has been aban-

doned. It is clear under both Noerr and Pennington that respond-

ents’ efforts to influence zoning legislation did not violate the anti-

trust laws.

5

tiffs with the organization, energy, experts, and financing

necessary to frame and pursue their efforts to obtain judi-

cial relief against the zoning changes petitioners had pro-

cured.

In 1975, ten years after the first Fayetteville Mall litiga-

tion commenced, petitioners obtained a zoning change for

their proposed Great Northern Mall, an entirely separate

project. Kimbrook Realty, one of the respondents, there-

after mounted, in its own right, a court challenge to this

new amendment. It brought a so-called Article 78 proceed-

ing, N.Y. Prac. Law §§7801-7806 (McKinney), which the

court dismissed on technical grounds without reaching the

merits. (Kimbrook Realty v. Onondaga County Planning

Board, New York State Supreme Court decision filed on

Feb. 7, 1977.) It also sought a declaratory judgment, but

that action was voluntarily discontinued by Kimbrook after

subsequent local zoning resolutions had rendered the suit

moot. Thus, the merits were reached in neither Kimbrook

action.

Petitioners allege, and for purposes of the decisions

below it was taken as true, that the two Kimbrook litiga-

tions were brought at the direction of the Eagans, and were

encouraged and financed by them and other respondents.

It is not alleged that Kimbrook was not itself interested in

the outcome of the litigation it commenced.

Petitioners also complain that respondents conspired to

oppose, by political means, development by unidentified

third parties of the Pyramid Mall East, a totally unrelated

shopping center. No such allegations were contained in

the dismissed complaint, but were mentioned the first time

only in the rejected proposed amended complaint (see infra

p. 7). In any case, petitioners had no interest whatsoever

in the Pyramid Mall matter.

Proceedings Below

Petitioners brought this action in the United States

District Court for the Northern District of New York.

They alleged that respondents’ involvement in the two sets

of state court litigations challenging the zoning amend-

ments, and their opposition to legislative enactment of the

amendments, constituted an illegal conspiracy in violation

of the Sherman Act, 15 U.S.C. §41, 2.

The District Court (Hon. Edmund Port, Senior Judge)

granted summary judgment‘ to respondents on the ground

that their alleged activities were not prohibited by the

Sherman Act, as this Court interpreted that Act in Noerr-

Pennington and California Motor Transport Co. v. Truck-

mg Unlimited, 404 U.S. 508 (1972).

Specifically, the District Court held that the Noerr-

Pennington doctrine protected respondents’ attempts to

influence the action of any branch of the government.

‘‘This protection is afforded, even if such action is anti-

competitive or monopolistic, ...’’ (p. A-18).°

Accepting the truth of petitioners’ allegation that respond-

ents were motivated by an anticompetitive intent, the court

concluded :

4+. Respondents had moved to dismiss the complaint pursuant to

Fed. R. Civ. P. 12 (b) (6) ; the District Court and the parties treated

the motion as one for summary judgment because certain respondents

submitted affidavits. For purposes of the motion, the allegations of

the complaint were accepted as true by the courts below.

5. Throughout this brief, pages in the Appendix to the instant

petition are referred to by the prefix “A’’; pages in the petition itself

are referred to by the prefix ‘‘ Pet.”’

7

‘*The First Amendment right of petition guarantees

all citizens the right to appeal to the legislature or the

judiciary. This right is not conditioned upon motive.’’

(A-19).

Petitioners thereafter sought leave, pursuant to Fed.

R. Civ. P. 59(e), to amend the judgment to permit them to

replead. They attached to their motion a 129-page proposed

amended complaint in an effort to cure the deficiencies of

the original 57-page complaint.® Included in the proposed

pleading were alleged transcripts of attorney/client tele-

phone conversations concerning the underlying state court

litigations. The trial court reviewed this elephantine pro-

posed new pleading and concluded that the proposed

amended complaint added nothing but length to the original

complaint. Petitioners’ motion was denied.

Petitioners’ appeal to the Second Cireuit was unavail-

ing. That court unanimously affirmed summary judgment

on the strength of Judge Port’s opinion. On the subordi-

nate issue of amendment, the Court of Appeals concluded

that there was no abuse of discretion by the District Court

in denying leave to file an amended complaint because the

respondents’ conduct, even under the facts and theory al-

leged in the new pleading, did not give rise to liability

under the antitrust laws.

6. During oral argument on the motion to dismiss, petitioners’

counsel conceded that there were no non-evidentiary facts which

could be added to the pleadings, even were he given a chance to

replead.

The entry of summary judgment does not merit

further review because respondents’ alleged activi-

ties fall squarely within the scope of the Noerr-

Pennington doctrine.

The petition presents no issues worthy of review by

this Court. It points to no conflict among the circuits con-

cerning the Noerr-Pennington doctrine. It identifies no

confusion among the lower courts as to the proper inter-

pretation of that doctrine. It presents no facts, peculiar

to this case, warranting a re-examination of that doctrine.

Lacking such grounds for review, petitioners attempt

to characterize this as a case involving the scope of anti-

trust exemptions. They cite City of Lafayette, La. v. Lou-

wsiana Power & Light Co., 485 U.S. 389, 98 S. Ct. 1123

(1978) for the proposition that a heavy burden is placed

upon those who would escape the strictures of antitrust by

resorting to ‘‘immunity’’ (Pet, p. 15). But respondents

do not claim, and the courts below did not impose, any

‘‘immunity.’’? As this Court held in Noerr, Congress never

intended, in adopting the antitrust laws, to abridge the

right of petition. The Sherman Act simply does not

prohibit competitors from combining to seek governmental

relief, notwithstanding that such efforts may have adverse

affects upon competition. This is true whether the relief

so sought be legislative, administrative, or judicial. Cali-

fornia Motor Transport v. Trucking Unlimited, 404 U.S.

508 (1972). If Congress did attempt to bar such petition-

ing, serious First Amendment problems would arise, but

it has never been the intention of Congress so to cut off

9

access to itself, the courts or any other government agency.

In short, this Court has already resolved petitioners’ ‘‘im-

munity’’ contention.

Moreover, the doctrines advanced in Noerr and its

progeny are clear and easy to apply. Petitioners assert

without discussion that ‘‘the Noerr exemption remains in

a state of confusion ard disarray ...,’’ and make footnote

reference to some 14 recent lower court cases in which

Noerr is cited, apparently to prove the confusion they

proclaim (Pet. pp. 24-25 n. 6). But petitioners nowhere

identify the ‘‘confusion’’ which concerns them, and ex-

amination of the 14 cases cited demonstrates that, contrary

to petitioners’ characterization, the lower courts have

well understood Noerr and have applied it consistently.’

Indeed, every court ever to consider the question has

held that Noerr-Pennington and California Motor Trans-

port protect litigation challenging shopping center rezon-

ing. Bob Layne Contractor, Inc. v. Bartel, 504 F.2d 1293

(7th Cir. 1974); Ernest W. Hahn, Inc. v. Codding, 423 F.

Supp. 913 (N.D. Cal. 1976); Bethlehem Plaza v. Campbell,

403 F. Supp. 966 (E.D. Pa. 1975); Bracken’s Shopping

Center, Inc. v. Ruwe, 273 F. Supp. 606 (S.D. Ill. 1967).

That is all that is involved here. This petition does not

7. Petitioners also cite Otter Tail Power Co. v. U.S., 300 F.

Supp. 451 (D. Minn. 1973), aff'd 417 U.S. 901 (1974) as if it

worked some radical revision of Noerr. It does not. As the District

Court held, the facts of Otter Tail are readily distinguishable from the

facts at hand; Otter Tail involved a scheme of repetitive litigation

practiced as “part of a larger unlawful scheme characterized by

monopolistic practices” (emphasis supplied) (p. A-29). Petitioners

make no effort to challenge the District Court’s careful analysis ; they

just ignore it.

10

present a novel issue, or a complex issue, or an issue with

which the courts have had difficulty.

The courts below found that the complaint, for all its

bulk, alleges no more than efforts to petition the govern-

ment; they held that, according to Noerr-Pennington, such

efforts were not illegal. Their readings of Noerr-Penning-

ton are not only correct but also fundamentally consistent

with the holdings of every other court which has so far

faced analogous facts.

In claiming that respondents’ litigation activity violates

the antitrust laws, petitioners seek, in effect, to overrule

Noerr-Pennington. But they offer no reason why that

doctrine, based as it is upon sound statutory construction,

if not constitutional compulsion, should abruptly be aban-

doned for their benefit.

Petitioners’ contentions

Here, as below, petitioners cloak their effort to escape

the consequences of Noerr-Pennington by invoking the nar-

row sham exception identified in Noerr and delineated in

California Motor Transport. But the facts alleged cannot

be reconciled with a ‘*sham.’’

It was noted in Noerr that circumstances could arise

where an illegal conspiracy amounted in reality to a simple

and naked restraint upon competition, even though the

fornial indicia of petition were preserved. In such a case,

the form of petition would be but a sham, and a sham does

not immunize anticompetitive conduct.

This abstract possibility was concretely encountered in

California Motor Transport v. Trucking Unlimited 404 U.S.

11

508 (1972), where it was held that a scheme by certain

California truckers to oppose without basis virtually all of

their competitors’ routine applications for operating rights

could constitute an illegal conspiracy. The conspirators

pursued their reflexive opposition before the California

Public Utilities Commission, the Interstate Commerce Com-

mission and the courts with total indifference to probable

cause and total disregard of the merits of their cases—to

the point wiere those authorities were overwhelmed and

could not effectively adjudicate the applications. This

Court said:

es

.

. . the allegations are not that the conspirators

sought ‘to influence public officials,’ but that they

sought to bar their competitors from meaningful access

to adjudicatory tribunals and so to usurp that decision-

making process.’’ (Id. at 512).

As the District Court here observed, ‘‘aecess barring is

the cornerstone to the sham exception.’’ (p. A-26). But no

respondent in this case ever barred petitioners’ access to

any tribunal; to the contrary, petitioners had full aecess to

government as they required it. The District Court found

that there was no access-barring here. Absent access-

barring, efforts to influence the government do not give rise

to antitrust liability even when those efforts are motivated

by a desire to reduce or eliminate competition—and so the

courts have always held.

It has also been suggested that when conspirators en-

deavor to corrupt the governmental process by means of

perjury, bribery, misrepresentation or the like, their con-

duct may amount to access-barring. But the opinion below

found:

12

‘‘Tn the instant case [petitioners ; have not alleged any

unethical or corrupt actions on the part of [respond-

ents] in suing to declare the zoning amendments void.

It is not alleged that perjury, bribery, misrepresenta-

tions, or any improprieties occurred during the litiga-

tion. Mere use of the state courts to challenge zoning

amendments ... cannot be characterized as an abuse

of the judicial process. On the contrary, it is one of the

facets of the First Amendment right of petition pro-

tected by Noerr.’’ (pp. A-26-A-27)

Petitioners argue that respondents should nevertheless

be denied the constitutional freedoms recognized by Noerr-

Pennington because (1) none of the respondents was a

party to any of the Fayetteville Mall litigations and not all

of the respondents were parties to the Great Northern

Mall proceedings, and (2) respondents involved themselves

in these state court matters with the intention of restrain-

ing competition with petitioners. These alleged facts, even

when taken as true, do not create a ‘‘sham’’ as that con-

cept has been articulated by any court, including this.

It is of no relevance that not all respondents were

parties plaintiff in the state court litigations they assisted.

Petitioners do not even attempt to argue that the under-

lying state litigations were sham in any intrinsic sense.

Clearly the 32 local property owners who brought the first,

successful, Fayetteville Mall proceeding and the 149 area

residents who brought the later litigations believed them-

selves to have real and legitimate grievances for which they

sought judicial redress.”

8. Petitioners suggest that the state court proceedings involve

a pattern of repetitive, baseless litigations. In fact, the state court

litigations were quantitatively modest and qualitattvely strong. The

(footnote continued on next page)

13

Instead petitioners argue that it was an illegal ‘‘misrep-

resentation of standing’’ for respondents to organize and

assist the Fayetteville state court litigants without them-

selves stepping forward as plaintiffs (Pet. p. 19).

As to the Great Northern Mall matter, petitioners ap-

pear to argue that the failure of the other respondents to

join as co-plaintiffs somehow rendered illegal Kimbrook’s

effort to redress its own grievances.

Petitioners do not cite a single case in support of the

proposition that it was illegal for respondents to assist

the third parties in litigation, nor do petitioners suggest

any misrepresentation of the standing of those persons who

actually were plaintiffs in these proceedings.

A similar ‘‘third party’’ argument was raised and re-

jected in Noerr itself as ‘‘legally irrelevant’? under the

Sherman Act, 365 U.S. at 142. This Court found the Noerr

defendants to have attempted to deceive public officials

by making it appear that certain public statements were

the spontaneously expressed views of independent persons

and civie groups when, in fact, they were largely prepared,

produced and paid for by the defendant railroads and their

agents. The Court found that conduct to constitute a rep-

rehensible deception, but nevertheless held it to be ‘‘of no

state court plaintiffs won the first litigation without appeal. They also

won the first two rounds of the second proceeding; petitioners finally

prevailed only upon a split Court of Appeals decision. The first

Great Northern Mall proceeding was dismissed on procedural grounds

and the second was withdrawn by plaintiffs as moot; neither ever

reser the merits. As the District Court dryiy observed, the facts

at han

“are hardly the threads from which a ‘pattern of baseless, repeti-

tive claims’. . . can be woven” (p. A-28).

14

consequence so far as the Sherman Act is concerned.’’

(Id. at 145.) Here, there is no claim of a comparable de-

ception, since the state court plaintiffs concededly were real

parties in interest, advancing actual objectives of their

own. Still, even if there had been a deception, it, too,

would ‘‘be of no consequence so far as the Sherman Act

is concerned,’’

This Court has also held, repeatedly, that individuals

have a constitutional right ‘‘to engage in association for

the advancement of beliefs and ideas’’ through litigation.

NAACP vy. Alabama, 357 U.S. 449, 460 (1958). In NAACP

v. Alabama, the court held members of the NAACP had a

constitutional right to associate for purposes which in-

eluded supporting litigation by third parties, 357 U.S. at

452. Moreover, they had a constitutional right to do so

anonymously: ‘*This Court has recognized the vital re-

lationship between freedom to associate and privacy in

one’s associations.’’ 357 U.S. at 462. The First Amend-

ment protects anonymous speech. Talley v. California, 362

U.S. 60, 64 (1960).

The Court reiterated the constitutional right to finance

and assist litigation by third parties in NAACP vy. Button,

371 U.S. 415 (1963) when it struck down a statute which had

the effect of forbidding solicitation of lawsuits by the

NAACP,

Although the NAACP cases involved litigation to ad-

vance political beliefs, the Court was careful to emphasize

that ‘‘it is immaterial whether the beliefs sought to be

advanced by association pertain to political, economic, re-

ligious or cultural matters,....’’ NAACP v. Alabama,

15

supra, 357 U.S, at 460. Accord, Abood v. Detroit Bd. of

duc., 431 U.S, 209, 231 & n. 28 (1977); Stern v. United

States Gypsum, Inc., 547 F.2d 1329, 1343 (7th Cir. 1977).

Petitioners refer in passing to Ohralik v. Ohio State

Bar Association, 436 U.S. 447, 98 S. Ct. 1912 (1978).

That decision rejects the proposition that the First Amend-

ment immunizes champerty, but in no way undercuts the

basic doctrine of Button that one party may assist the liti-

gation of another. Indeed, as stated in Ohralik,

‘*the rule does not prohibit a lawyer from giving un-

solicited legal advice; it proscribes the acceptance of

employment resulting from such advice.’’ 98 S. Ct.

at 1920.

Here respondents gave the local citizens assistance; they

did not aecept employment.

This Court has held in three separate decisions that

third parties have a constitutional right to finance and

assist in litigation to vindicate purely economic rights—the

recovery of money damages for work-related injuries—be-

cause ‘‘the First Amendment does not protect speech and

assembly only to the extent it can be characterized as

politieal.’’ United Mine Workers vy. Illinois State Bar

Ass’n, 389 U.S, 217, 223 (1967). Accord, United Transp.

Union v, State Bar, 401 U.S. 576 (1971); Brotherhood of

R.R. Trainmen v. Virginia ex rel. Virginia State Bar, 377

U.S. 1 (1964). Similarly, a statutory provision forbidding

an employer organization from financing lawsuits by em-

ployees against their unions has been held unconstitutional

because it violates the First Amendment rights of associ-

ation and petition. International Union UAW vy. National

16

Right to Work Legal Defense and Educ. Foundation, Inc.,

433 F. Supp. 474, 481-482 (D. D.C. 1977).

In Ernest W. Hahn, Inc. v. Codding, 423 F. Supp. 913,

918 (N.D. Cal. 1976), one of the many cases holding that

zoning litigation is within the scope of Noerr-Pennington,

it was expressly held that:

‘¢ the allegation that defendants solicited others to

bring lawsuits, standing alone or in conjunction with

the charge that Codding brought sham lawsuits, [does

not] create a claim cognizable under the antitrust

laws.’’

Moreover, not one of the many other court decisions hold-

ing attempted or actual instigation of third-party litigation

to be protected by Noerr-Pennington even mentions that

such conduct might fall within the sham exception. Semke

v. Enid Automobile Dealers Ass'n, 456 F.2d 1361, 1363 (10th

Cir. 1972); Rush-Ilampton Indus. v. Home Ventilating

Inst., 419 F. Supp. 19, 23 (M.D. Fla. 1976); Bethlehem

Plaza v. Campbell, 403 F. Supp. 966, 968 (E.D. Pa. 1975) ;

First Delaware Valley Citizens Television, Inc. v. CBS, Inc.,

398 F. Supp. 917, 923 (.D. Pa. 1975); Brackens Shopping

Center, Inc. v Ruwe, 273 F. Supp. 606, 607 (S.D. Ill. 1967).

Petitioners suggest no reason for reviewing, much less

departing from, these well-established, well-understood and

evenly-applied principles.

The third party issue is not only irrelevant under Noerr

and under the Constitution, it is also irrelevant as a matter

of ordinary logic. What possible practical difference could

it have made if respondents had also appeared as plaintiffs

in the state court actions? Petitioners imply that they

17

could then have ‘‘expeditiously expose[ed] the frivolous-

ness of the litigation to which [they had] been subjected’’

(Pet. p. 19). But exposure of respondents’ ‘‘frivolousness”’

would not have affected the interests of the other, actual

plaintiffs, whose standing to pursue their state court ac-

tions has never been quesioned. Whether or not the re-

spondents were named as plaintiffs, the litigations would

have proceeded just as they did."

’

The motives of respondents in assisting the state court

litigants are irrelevant under Noerr-Pennington.

The second strand of petitioners’ position, that respond-

ents fall outside of Noerr-Pennington because they intended

the anticompetitive consequences of the litigations they

sponsored, likewise raises no cert-worthy issue. The con-

tention is disposed of by Noerr itself.

In Noerr, this Court acknowledged that attempts to

influence government conduct may be motivated by the

desire to gain a competitive advantage. But the Court

held that such motive is of no moment. The whole point

of Noerr was that the ‘‘legality [of attempts to influence

government conduct] was not at all affected by any anti-

competitive purpose [defendants] may have had.’’ 365

U.S. at 140.

9. Petitioners ergue that respondents had no standing to sue in

the state court actions. This contention raises an issue of state law

not addressed by the courts below and not worthy of Supreme Court

review. Clearly, on the basis of the present record, no informed judg-

ment could be made that respondents, or any of them, could not have

framed complaints sufficient to proceed in their own rights. And,

again, had respondents joined as plaintiffs and then been dismissed

for lack of standing, the state actions nevertheless would have pro-

ceeded just as they did.

18

In undertaking to assist the local property owners chal-

lenge to petitioners’ zoning amendments, respondents ob-

viously knew that one effect of such litigation could be a

delay in construction of petitioners’ shopping center, to

respondents’ competitive advantage. Neither this knewl-

edge, nor the anticompetitive motive it suggests, raises

unique Noerr-Pennington issues. The law is clear that

anticompetitive motive is irrelevant."

As this Court reiterated in Pennington, ‘* Nothing could

be clearer ... than that anticompetitive purpose did not

illegalize the conduct [in Noerr].’’ 381 U.S. at 669. As

stated in Noerr, ‘‘To hold that the knowing infliction of

[anticompetitive] injury renders the campaign itself illegal

would thus be tantamount to outlawing all such campaigns’’

(365 U.S. at 143-44). As stated in Adolph Coors, Co. v.

A&S Wholesalers, Inc., 561 F.2d 807, 812 (10th Cir. 1977),

anyone making ‘ a genuine attempt to secure a decision

from the court on the merits’

nington.

10. Petitioners quote extensively from the alleged transcripts of

attorney /client communications they have somehow obtained to estab-

lish the proposition that some respondents desired to delay construc-

tion of the new shopping centers. These documents are irrelevant to

the summary judgment issue. The transcripts appear only as exhibits

to the disallowed proposed amended complaint, filed after summary

judgment was granted. A Distnet Court may decide a summary judg-

ment motion only on the facts and arguments on the record before it.

Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 n. 16 (1970).

However, the quotations contradict the very purpose for which they

are selectively cited. Thus petitioners quote respondent Eagan as

having told his attorney that “first of all, we hope we can stop them

dead ; if not, we can delay...” (p. 22). Whatever [Eagan’s motives

as to delay, his objective “first of all” was to win a lawsuit and there-

by “stop them dead.’ But there is no need to debate primary or

secondary motive, for motive does not affect the application of Noerr-

Pennington. Accordingly, as found by both courts below, these tran-

scripts add nothing to petitioners’ case.

is protected by Noerr-Pen-

19

If the easy allegation of impure motive were sufficient

to remove litigations with anticompetitive implications

from the ambit of Noerr-Pennington, there would be no

practical protection for any such adjudicatory effort to

redress a grievance, since some impure motive can always

be alleged, and, realistically, can usually be demonstrated.

But no court has ever held that purity of heart is a pre-

condition for the Noerr-Pennington doctrine. Petitioners

do not cite a single case holding that a serious attempt to

obtain judicial resolution of a real dispute is rendered

illegal by the presence of some anticompetitive motive.

Any such holding would have issued in flat disregard of

this Court’s clear and simple doctrine: the Sherman Act

does not apply to honest efforts to petition the government,

whatever the motive for, and whatever the consequences of,

such petitioning.

Denial of petitioners’ post summary judgment

motion to alter and amend the complaint does not

merit further review since such denial was within

the sound discretion of the trial court.

Petitioners ‘‘raise their objection’? to the District

Court’s denial of leave to replead as one of their ‘‘ques-

tions presented’’ herein (p. 3). It is not clear whether they

in fact assert this as an appropriate question for certiorari.

Having ‘‘raised their objection,’’ petitioners make no

effort anywhere in their brief (1) to argue that the trial

court abused its discretion or (2) to demonstrate that this

matter is worthy of review on certiorari.

20

Petitioners sought no leave to amend their complaint

until after summary judgment had been granted against

them. They then sought relief under the stringent discre-

tionary standards of a motion to alter judgment under Rule

59(e), Swan v. Board of Higher Education, 319 F.2d 56,

61 (2d Cir. 1963). Denial of a Rule 59(e) motion is re-

versible only where there has been an abuse of discretion,

Komie v. Buehler Corp., 449 F.2d 644, 647-48 (9th Cir.

1971).

Petitioners are apparently well aware that this Court

does not regularly sit to review discretionary decisions of

trial courts. The Second Cireuit has already reviewed

this issue’and determined that the District Court did not

abuse its discretion (p. A-2).

The District Judge noted that, on oral argument of the

motion for summary judgment, petitioners conceded that

the original complaint contained all material facts relating

to their claim (p. A-31). The court found that, consistent

with that concession, the proposed amended complaint

added no relevant facts ‘‘not assumed to be in the original

complaint.’’ It concluded that granting the motion to alter

judgment would ‘‘result in a futile, useless gesture.’’ The

Second Circuit expressly concurred in this judgment (p.

A-2). Petitioners make no effort to demonstrate any abuse

of discretion, and do not even brief the issue in their

petition. There is no reason why certiorari should be

granted on this point.

21

Conclusion

For the foregoing reasons, the petition for writ

of certiorari should be denied.

Dated: New York, New York

November 2, 1978

Respectfully submitted,

Simon H. Rirgrnp

Attorney for Respondents

Eagan Real Estate, Inc., Eagan Real

Estate Management Corp., Eagan

Real Estate, Leo T. Eagan, William

Eagan, Edward Eagan, Kimbrook

Corp., Paul D. Lonergan, Katherine

M. Shea and John Murphy

345 Park Avenue

New York, New York 10022

(212) 644-8602

Pau, Weiss, Rirkixnp, WHarton & Garrison

Mark H. Atcort

Neat JOHNSTON

Of Counsel