# Appendix — McLain v. Real Estate Bd. of New Orleans, Inc. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_0093%3A02 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 1980 - **Citation:** 444 U.S. 232 ## Text ‘Gupreme Court, U, & 7 FILED JUL 27 1979 APPENDIX MICHAEL RODAK, JR, CLERK IN THE Supreme Court of the United States OCTOBER TERM, 1978 No. 78-1501 JAMES JEFFERSON McLAIN, ET AL., Petitioners, versus REAL ESTATE BOARD OF NEW ORLEANS, INC., ET AL., Respondents. ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT PETITION FOR CERTIORARI FILED MARCH 31, 1979 CERTIORARI GRANTED MAY 14, 1979 —_<-.. IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1978 No. 78-1501 JAMES JEFFERSON McLAIN, ET AL., Petitioners, versus REAL ESTATE BOARD OF NEW ORLEANS, INC., ET AL., Respondents. ON 'VRIT OF CERTIORAR! TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT INDEX Page Chronological List of Relevant Docket Entries ....1 A. Inthe United States District Court for the Eastern District of Louisiana ......... 1 INDEX (Continued) . Page B. Inthe United States Court of Appeals for the Fiftly Circuit) .. i. . de. c ces cw woeces 5 C. In the Supreme Court of the United PTDL, Cah ele GAs Caner we eee. ck chee 6 ge ge. a rm McLain Pet. App. la Answer, Isabelle McLeod ............eeeeeeeeeees 7 Anbwrer, Stan Pre be ie ka a a eee dee ey abuse 11 PRO Ste CPOE as oo CUER Eek ne pokes Sacevewekebes 15 Defendants’ Motion to Dismiss ................- 18 Affidavit of Max Derbes, Jr. on 2-18-76 ....... 40 Affidavit of Dalton iL. Truax, Jr. on 2-23-76 ...42 Plaintiffs’ Motion for Extension of Time To Answer Defendants’ Motion to Dismiss ....... 44 Plaintiffs’ Memorandum in Opposition to Defendants’ Motion to Dismiss .............. 47 Minute Entry filed April 28, 1976 ............... 72 Defendants’ Motion and Order for Con- TIMUANCE 2. ce cccccvccvcccescvesscconees evens 73 Minute Entry filed May 12, 1976 ............... 75 Minute Entry filed June 2, 1976 ................ 76 Plaintiffs’ Motion for Extension of Time ....... 77 Minute Entry filed August 26, 1976 ............. 79 — — ili INDEX (Continued) Page Minute Entry entered September 3, 1976 ....... vi Notice of Deposition of M. P. Turner ........... 83 Notice of Deposition of Gertrude Gardner, MOU aS 6 ks maaan 4 Tk NO belie oe kv eon hades 84 Notice of Deposition of James Mills ............. 85 Notice of Deposition of Paul Griener ............ 87 Notice of Deposition of Mr. Angel V. Miranda ...88 Notice of Deposition of Julian Hecker ........... 89 Notice of Deposition of Edmond G. Miranne..... 92 Notice of Deposition of Stan Weber ............. 94 Plaintiffs’ Motion to Extend Discovery ......... 97 Plaintiffs’ First Set of Interrogatories to EEO GRIEG 35.65 k da tee RS BRIN ke dh ote emacs 990 Notice of Deposition of Max Derbes, Jr. ........ 108 Plaintiffs’ Amended Notice of Depositions ...... 109 Defendants’ Objections to Interrogatories ...... 117 Minute Entry filed January 18, 1977 ........... 120 Letter: January 28, 1977, Moise Steeg to Jerry Meunier, Courtroom Deputy ............... 121 Excerpts from Deposition of Edmond G. IE abn 5 tae on bina ose OE ees Wb ins Garey eo 122 Excerpts from Deposition of Angel Miranda ....165 iv INDEX (Continued) Page Excerpts from Deposition of Julian O. Hecker ..173 Excerpts from Deposition of James W. Mills, JP. wore vbdieme a ckcee eiiiwas Men aetOemena wees 207 Excerpts from Deposition of Meaher P. FUPROT ob. 6. ck ble aeons 220 Excerpts from Deposition of Max Derbes, Jr. ...236 Excerpts from Deposition of Stan Weber ...... 267 Judgment: United States District Court for the Eastern District of Louisiana ........ vie, 208 Memorandum Opinion and Order, United States District Court for the Eastern District of Louisiana ..... McLain Pet. App. 17a Opinion, United States Court of Appeals for the Fifth Circuit ........ McLain Pet. App. 24a Order Denying Rehearing, United States Court of Appeals for the Fifth Ciscwlt i556 a8 veahiae ta nean McLain Pet. App. 42a In the United States District Court for the Eastern District of Louisiana JAMES JEFFERSON McLAIN, ET AL. versus CA NO. 75-3402(D) REAL ESTATE BOARD OF NEW ORLEANS, ET AL Chronological List of Relevant Docket Entries: DATE NO. PROCEEDINGS 10-31-75 1 Plaintiffs’ Complaint 12-12-75 11 Answer, Defendant Isabelle McLeod 12-17-75 12 Answer, Defendant Stan Weber 1- 5-76 13 Pre-trial order — Defendants relieved from filing answers until date to be fix- ed (E.J.B.) 3- 5-76 14 Defendants’ Motion to Dismiss, Notice of Hearing on 3-31-76, with memo 3-25-76 15 On Plaintiffs’ Motion, ORDERED: That Defendants’ Motion to Dismiss be reset for 4-28-76 and that Plaintiffs reply to Defendants’ Motion to Dis- miss by 4-7-76 (E.J.B.) 4- 8-76 16 Plaintiffs’ Memorandum in Opposition to Motion to Dismiss 4-28-76 17 Minute entry: That Motion to Dismiss | set for hearing 4-28-76 to be continued upon written motion of Defendants 4-27-76 5-12-76 5-14-76 6- 2-76 6-10-76 6-21-76 7- 2-76 8-26-76 9- 8-76 9-14-76 10-15-76 12-17-76 18 19 20 21 22 23 24 25 26 27 28 29 2 Defendants’ Motion for Continuance of Hearing on Motion to Dismiss, ORDERED: That Defendants’ Motion to Dismiss is continued until 5-26-76 Minute entry: Hearing set for 5-26-76 is continued to 6-2-76 at 10:00 a.m. Defendants’ first supplemental memorandum in support of Motion to Dismiss Motion to Dismiss: Submitted ORDER: That Plaintiffs have until 6- 18-76 to file further memoranda Plaintiffs’ first supplemental memorandum in opposition to Motion to Dismiss Defendants’ second Supplemental Memorandum in support of Motion to Dismiss Minute Entry: Conference is set for 9- 3-76 at 3 P.M. (E.1.B.) Minute Entry: Conference held 9-3- 76; further conference to be held 10- 13-76 Third Supplemental Memorandum in support of Defendants’ Motion to Dis- miss Minute Entry: Conference held 10-13- 76 adjourned to 1-14-77 at 4:00 P.M. Plaintiffs’ notice to take the deposition of Mr. M. P. Turner on 12-28-76 at 9:00 A.M. 12-17-76 12-17-76 12-17-76 12-17-76 12-21-76 12-21-76 12-21-76 12-21-76 12-22-76 12-23-76 12-28-76 30 31 32 33 34 35 36 38 39 41 43 3 Plaintiffs’ notice of deposition of Ger- trude Gardner Inc. on 12-27-76 at 2 P.M. Plaintiffs’ notice of deposition of Mr. J. Mills on 12-28-76 at 2:00 P.M. Plaintiffs’ notice of deposition of P. Griener on 12-28-76 at 3:00 P.M. Plaintiffs’ notice of deposition of A. V. Miranda on 12-28-76 at 11:00 A.M. Plaintiffs’ notice of deposition of Mr. J. Hecker on 12-30-76 at 11:00 A.M. Plaintiffs’ notice of deposition of Mr. E. G. Miranne on 1-6-77 at 9:30 A.M. Plaintiffs’ notice of deposition of Mr. Stan Weber on 12-29-76 at 3:30 P.M. On Plaintiffs’ Motion, ORDERED: That cutoff date for discovery is ex- tended from 12-31-76 to 1-14-77. Plaintiffs’ first set of interrogatories. Plaintiffs’ notice of deposition of Mr. Max Derbes Jr. on 1-6-77 at 2:00 P.M. Plaintiffs’ amended notice of deposi- tion of: 1. P. Turner, 1-3-77 at 9:00 A.M. 2. A. Miranda, 1-3-77 at 11:00 A.M. 3. J. Mills, 1-6-77 at 2:00 P.M. 4. P. Griener, 1-4-77 at 10:00 A.M. 5. A. T. Post, 1-10-77 at 2:00 P.M. 6. S. Weber, 1-10-77 at 10:30 A.M. 7. J. Hecker, 1-7-77 at 10:00 A.M. 8. M. Derbes, 1-13-77 at 2:00 P.M. 1-18-77 1-20-77 1-20-77 2- 2-77 2-14-77 2-18-77 3-11-77 3-29-77 3-29-77 3-29-77 3-29-77 5-31-77 6-24-77 8- 3-77 50 52 53 54 55 56 57 4 Minute entry: Further conference held 1-14-77. Defendants are granted until 3-14-77 to reply to Plaintiffs’ Memorandum. Deposition of A. Miranda, taken 1-3- 77 Deposition of E. G. Miranne, taken 1- 6-77 Letter: Moise Steeg to Jerry Meunier, Courtroom Deputy, Section D, re: Return on subpoena duces tecum to Carruth Mortgage Corporation Deposition of J. O. Hecker taken 1-17- 77 Plaintiffs’ second Supplemental Memo in opposition to Defendants’ Motion to Dismiss Defendants’ third Supplemental Memorandum in support of Motion to Dismiss Deposition of J. W. Mills, Jr., taken 1-6- 77 Deposition of M. P. Turner, taken 1- 13-77 Deposition of M. Derbes, taken 1-12- 77 Deposition of Stan Weber, taken 1-11- ee . Memorandum Opinion and Order: Defendants’ Motion to Dismiss is granted, Plaintiffs’ action is dismissed Plaintiffs’ Notice of Appeal Case forwarded to Court of Appeals IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT JAMES JEFFERSON McLAIN, et al., : Plaintiffs-Appellants, versus No. 78-2324 REAL ESTATE BOARD OF NEW ORLEANS, INC., et al., Defendants-Appellants. Chronological List of Relevant Docket Entries: DATE PROCEEDINGS 11-15-78 Judgment and Opinion of the United States Court of Appeals for the Fifth Circuit af- firming dismissal of Plaintiffs’ Action 12-15-78 Denial of panel re-hearing by United States Court of Appeals for the Fifth Circuit IN THE SUPREME COURT OF THE UNITED STATES JAMES JEFFERSON McLAIN, et al., Piaintiffs-Petitioners, versus No. 78-1501 REAL ESTATE BOARD OF NEW ORLEANS, INC., et al., Defendants-Respondents. Chronological List of Relevant Docket Entries: DATE PROCEEDINGS 3-14-79 Plaintiffs’ application for extension of time to file Petition for Writ of Certiorari 3-15-79 ORDER: That Petitioner is granted until April 2, 1979 in which to file Petition for Writ of Certiorari 3-31-79 Plaintiffs’ Petition for Writ of Certiorari 5-14-79 ORDER: “The Petition for a Writ of Cer- tiorari is Granted.” ae ee ee eI ee ee ee eee are ne ne i cesar erecta cet a Na sat 8 ae ae Sin Cit aceasta lace + 7 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA JAMES JEFFERSON McLAIN, DOUGLAS ARTHUR NETTLETON, JR., RAYMOND JOSEPH MUNNA, IRVING HIRSCH KOCH, and all other parties similarly situated Plaintiffs, versus . CA No. 75-3402(D) REAL ESTATE BOARD OF NEW ORLEANS, INC., JEFFERSON BOARD OF REALTORS, INC., GER- TRUDE GARDNER, INC., LATTER AND BLUM, INC., WAGUESPACK AND PRATT, INC., STAN WEBER AND ASSOCIATES, INC., SANDRA, INC., ISABELLE C. McLEOD dba ISABELLE C. McLEOD, REALTORS, and ali other parties similarly situated, Defendants. Filed: Dec. 12, 1975 ANSWER For the answer to the Complaint of the petitioner in the above entitled cause, isabelle McLeod d/b/a Isabelle C. McLeod, Realtors, defendant above named, says: I. Defendant denies the allegations contained in Paragraph I for lack of sufficient information and belief. 8 I. Defendant denies the allegations of Paragraph II for lack of sufficient information and belief. Ul. Defendant admits the allegations of Paragraph Ill in- sofar as Isabelle McLeod d/b/a Isabelle C. McLeod, Realtors, transacts business and has an office in the Eastern District of Louisiana. IV. ’ Defendant denies the allegations of Paragraph IV for lack of sufficient’ information and belief except that defendant, Isabelle McLeod d/b/a Isabelle C. McLeod, did provide real estate brokerage service in connection with a sole transaction for Douglas Arthur Nettleton, Jr. V. Defendant denies the allegations of Paragraph V. VI. Defendant denies the allegations of Paragraph VI ex- cept that the Real Estate Board of New Orleans, Inc. is a Louisiana corporation and provides certain services to its members. VIL. Defendant denies the allegations of Paragraph VII for lack of sufficient information and belief. ee a leas 9 VIII. Defendant denies the allegations of Paragraph VIII for lack of sufficient information and belief. IX. Defendant denies the allegations of Paragraph IX. X. Defendant denies the allegations of Paragraph X. XI. Defendant denies the allegations of Paragraph XI. XII. Defendant denies the allegations of Paragraph XII. XIII. Defendant denies the allegations of Paragraph XIII. XIV. Defendant denies the allegations of Paragraph XIV for lack of sufficient information and belief. XV. Defendant denies the allegations of Paragraph XV. XVI. Be Defendant denies the allegations of Paragraph XVI. 10 XVII. Defendant denies the allegations of Paragraph XVII. XVIII. Defendant denies the allegations of Paragraph XVIII. XIX. Defendant denies the allegations of Paragraph XIX. XX. Defendant denies the allegations of Paragraph XX WHEREFORE, defendant prays for: I. Judgment that the Complaint of the Petitioner be dismissed with prejudice and at plaintiffs’ costs. CHAFFE, McCALL, PHILLIPS, TOLER & SARPY ‘ | ls) GERALD WASSERMAN Leon Sarpy Gerald Wasserman (Certificate of Service Omitted) tL ee ei 11 IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION (Number and Title Omitted) Filed: Dec. 17, 1975 ANSWER For answer to the complaint of the petitioners in the above cause, Stan Weber & Associates, Inc., a defen- dant above named, says that: - Defendant denies the allegations contained in paragraph I for lack of sufficient information and knowledge to justify a belief. Il. Defendant denies the allegations contained in paragraph IJ for lack of sufficient information and knowledge to justify a belief. III. Defendant denies the allegations contained in paragraph III except to admit that defendant does do business and has an office in the Eastern District of — Louisiana. 12 IV. Defendant denies the allegations contained in paragraph IV for lack of sufficient information and knowledge to justify a belief. V. Defendant denies the allegations contained in paragraph V. VI. Defendant denies the allegations contained in paragraph VI except that it does admit that the Keal Es- tate Board of New Orleans, Inc. is a Louisiana corpora- tion and provides certain services to its members. VIL. Defendant denies the allegations contained in paragraph VII except to admit that the Jefferson Board of Realtors is a Louisiana corporation maintaining an ° office and transacting business in the Eastern District of Louisiana. VIII. Defendant denies the allegations contained in paragraph VIII for.lack of sufficient information and knowledge to justify a belief except to admit its name and that it is a Louisiana corporation domiciled in the Eastern District of Louisiana where it does business. a eet ee va eee ee 13 IX. Defendant denies the allegations contained in paragraph IX. X. Defendant denies the allegations contained in paragraph X. XI. Defendant denies ‘the allegations contained in paragraph XI. XII. Defendant denies the allegations contained in paragraph XII for lack of sufficient information and knowledge to justify a belief. XIII. Defendant denies the allegations contained in paragraph XIII for lack of sufficient information and knowledge to justify a belief. XIV. Defendant denies the allegations contained in paragraph XIV for lack of sufficient information and knowledge to justify a belief. XV. Defendant denies the allegations contained in paragraph XV. 14 XVI. Defendant denies the allegations contained in paragraph XVI. XVII. Defendant denies the allegations contained in paragraph XVII. XVIII. Defendant denies the allegations contained’ in paragraph XVIII. XIX. Defendant denies the allegations contained in paragraph XIX. XX. Defendant denies the allegations contained in paragraph XX. ; WHEREFORE, defendant prays for judgment that the complaint of the petitioners be dismissed with pre- judice and at their cost. ls) CHARLES F. BARBERA CHARLES F. BARBERA (Certificate of Service Omitted) — tts Si abit oe re ee ee arene Te oo i A al cl Br a eS ae 15 IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION (Number and Title Omitted) Filed: Jan. 5, 1976 PRE-TRIAL ORDER Counsel for plaintiffs and counsel for defendants have presented to the Court the following agreed schedules and dates to orderly progress this cause; and, the Court finding same to be appropriate and reasonable; IT IS HEREBY ORDERED that: 1. Any motion by a defendant to quash service or to object to the jurisdiction or venue of this Court shall be filed on or before sixty (60) days from the date hereof. Plaintiffs’ reply, if any, to such motions, shall be filed within thirty (30) days of the service of said motions; and defendants shall file their response to plaintiffs’ reply, if any, within twenty (20) days. Any such motions shall be noticed for hearing by the plaintiffs on a date convenient to the Court. 2. Any motion to be filed by a defendant under Rule 12(b) (other than those referred to in paragraph 1 above) or 12(e) shali be filed on or before thirty (30) 16 days following the date on which the Court shall have rendered its decision on all of the motions filed under paragraph 1 above. Any such motions shall be noticed for hearing by the plaintiffs on a date convenient to the Court. 3. Onor before the date fixed for filing motions un- der paragraph 2 hereof, defendants will file and serve, it same are to be filed, interrogatories directed to plain- tiffs as to the grounds for their pleadings under the provisions of Rule 11 of the Federal Rules of Civil Procedure; within sixty (60) days thereafter, plaintiffs will serve answers or objections to any such interroga- tories; within thirty (30) days following receipt of answers to all interrogatories which plaintiffs must answer, defendants shall file all motions, if any are to be filed, contemplated by Rule 11 of the Federal Rules of Civil Procedure. Plaintiffs shall serve any reply to any such motions within twenty (20) days of the serv- ice of such motions and within ten (10) days thereafter defendants shall file any response to plaintiffs’ reply. 4. On or before thirty (30) days following the last date on which this Court disposes of all motions filed pursuant to paragraphs 2 and 3 above, the parties to this action shall initiate discovery proceedings for the limited purpose of determining whether this action is to be maintained as a class action under Rule 23 of the Federal Rules of Civil Procedure, including depositions of plaintiffs and others, interrogatories and requests Aw en ol ee acti a. Amin iain at ee ee a tee 17 for the production of documents. Such discovery may be conducted by the parties in one or more stages and shall be completed within one hundred eighty (180) _ days or such greater period as may be fixed by the Court. 5. On or before thirty (30) days following the date established in paragraph 4 above for the conclusion of discovery limited to questions involving whether this action may be maintained as a class action, all motions involving the class action question will be filed and served; within forty-five (45) days after service of any such motion the opposing parties will file their response thereto and movers shall have ten (10) days thereafter to reply. 6. All discovery, other than discovery permitted by paragraphs 3 and 4 above, shall be held in abeyance un- til further order of this Court following the determina- tion of the class action questions as provided in paragraph 5 above; provided, however, the Court may authorize discovery upon a showing of good cause, such as the age or infirmity of a potential witness. 7. Designation of counsei to represent all counsel of the respective parties to receive and forward notices and notify the Court of responses and actions con- cerning pre-trial matters, etc., shall await the deter- mination of the motions contemplated by paragraphs 1 and 5 above. 18 IT IS FURTHER ORDERED that all defendants are hereby relieved from filing answers until a date to be fixed by further order of this Court following its deter- mination of all class action questions as provided in paragraph 5 above. IT 1S FURTHER ORDERED that deviations from or additions to this schedule will be permitted only by a further order of this Court. New Orleans, Louisiana, this 5th day of January, 1976. ls} EDW. J. BOYLE, SR. UNITED STATES DISTRICT JUDGE (Signature of Counsel Omitted) IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION (Number and Title Omitted) Filed: Mar. 5, 1976 MOTION TO DISMISS Defendants move the court to dismiss this action because the complaint fails to state a claim against defendants upon which relief can be granted on the ground that the court lacks jurisdiction for the follow- ing reasons: elite be = 19 First, that the alleged claim does not arise under any act of Congress regulating Commerce or protecting trade and Commerce against restraints and monopo- lies as provided under Title 28, Section 1337 of the United States Code, all as appears more fully from the affidavits of Max Derbes, Jr. and Dalton L. Truax, Jr., annexed hereto as part hereof and marked “Exhibits A & B’ respectively for identification; and Second, that the requisite diversity jurisdiction is lacking because it appears on the face of the complaint that the controversy is not between citizens of different states, but that all plaintiffs and defendants are citizens and residents of or domiciled and have their principal offices in the State of Louisiana. IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION - (Number and Title Omitted) MEMORANDUM IN SUPPORT OF MOTION TO DISMISS MAY IT PLEASE THE COURT: This Memorandum is filed in support of defendants’ Motion to Dismiss for want of subject matter jurisdic- tion. The complaint purports to state a claim “for in- junctive relief and trevle damages under the anti-trust 20 laws” against defendants who are realtors doing business within the jurisdiction of this Honorable Court. The jurisdictional allegations, set forth under the heading “The Nature of Trade and Commerce,” are contained in paragraphs XI, XIII and XIV. Paragraph XI alleges no facts, but merely asserts the conclusion that defendants’ activities “are within the flow of interstate commerce and have an effect upon that commerce.” Paragraph XIII alleges that many per- sons using defendants’ services in connection with the purchase and sale of real estate “are persons moving into and out of the Greater New Orleans Area.” Paragraph XIV alleges that defendants assist their clients in securing, financing and insurance involved with the purchase of real estate and that “.., such financing and insurance are ob- tained from sources outside the State of Louisiana and move in interstate commerce into the State of Louisiana through tke ac- tivities of the defendants.” In fact, defendants do not engage in any interstate ac- tivities and the allegation as to financing and insurance is directly contradicted by the averments of the affi- davits of Max J. Derbes, Jr. and Dalton L. Truax, Jr. an- nexed to defendants’ Motion to Dismiss. These affidavits recite that real estate brokers in the State of Louisiana are licensed by the State to perform a racine steele ila natn nen Le vac Ne eetiian 21 the function of real estate brckers in that State and no other. They further aver that there is no legal or other requirement that the sale or purchase of real estate in the State of Louisiana be made tiirough a real estate broker and that the affiants has personal knowledge of sales made other than through such brokers. These affidavits further aver that the function of real estate brokers is to bring buyers and sellers together, that their commissions are earned wher this has been done and that they have essentially completed their func- tion when they have done so. It is finally averred that real estate brokers do not obtain and are not instri- mental in obtaining financing of credit sales, save in a few special cases, nor are they connected with exami- nation of titles in connection with the sale of real estate or financing of such sales. It is submitted that defendants’ activities as real es- tate brokers are clearly intrastate in nature and have no effect on interstate commerce. As such, they do not meet the criteria for application of federal anti-trust laws: “ .. The test of jurisdiction is not that the acts complained of affect a business engaged in interstate commerce, but that the conduct complained of affects the interstate commerce of such business. “ ... despite the increased thrust of federal commerce power as_ business operations become more interrelated and complex, the 22 courts have consistently required that in order for federal anti-trust jurisdiction to be sustained the effect on interstate commerce of an alleged antitrust violation in a local area must be direct and substantial, and not mere- ly inconsequential, remote or fortuitous.” (citing authorities) Page v. Work, 290 F.2d 323, 330, 332 (9th Cir. 1961). Page v. Work, supra, was an action in behalf of a news- paper primarily engaged in publication of legal adver- tising for treble damages for violation of the anti-trust laws against a bureau representing newspaper owners in solicitation of legal advertising upon the ground that acts of the bureau caused alleged Icss of publication of delinquent tax lists. Affirming a district court judg- ment of dismissal, the Court of Appeal concluded in its opinion as follows: “{11] In our view, the language of Section 18 in no way indicates that Congress intended to apply the provisions of that Act to purely loca! activities wholly directed to a local intrastate market and relating to a product not in the flow of interstate commerce and where the effects on interstate activities in which the parties engage are insubstantial, inconse- quential and fortuitous, if not nonexistent.” at 333-4. This requirement that the effect of the activity in question on interstate commerce be substantial and 23 direct, and not merely remote and incidental, lead to dismissal of anti-trust actions against realtors in Marston v. Ann Arbor Property Managers Assn., 302 F. Supp. 1276 (D. C. Mich. 1969), aff’d 422 F.2d 836 (6th Cir. 1970), and Cotillion Club, Inc. v. Detroit Real Estate Board, 303 F. Supp. 850 (D. C. Mich. 1964). It is submitted that these decisions are precisely in point, are control- ling and are dispositive of the plaintiffs’ claims herein. In Marston, supra, the alleged conspiracy was to fix the price level of rental apartments in Ann Arbor, Michigan and to control the supply of new apart- ments; jurisdiction was sought to be invoked under the provisions of Section 4 of the Clayton Act, as is sought herein. The district court dismissed the complaint for lack of jurisdiction, holding: “{1,2] This court concludes that the pro- visions found within Section 1 of the Sher- man Act have not been met and is fatal to plaintiffs’ case. Section 1 of the Sherman Act provides that ‘every contract, combination in the form of trust or other wise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is de- clared to be illegal * * *.’ Unless interstate or foreign commerce has been directly and un- reasonable restrained, there can be no viola- tion of the Sherman Act and no private cause of action under the Clayton Act. The court is aware that a business of which the ultimate 24 object is the operation of intrastate activities, such as local apartment construction and rent- al, may make sucha utilization of the channels of interstate trade and commerce that the business itself assumes some minor inter- state character. However, the court does not find defendants conducting such a business. Defendants’ business is not of such an in- terstate character as intended by the Act. “It is clear from the complaint that the re- straints alleged relate only to the rental of real estate in the Ann Arbor area. This is local com- merce and the competition allegedly restrained and inter- fered with is local in nature. There is no evidence that defendants’ business has, or will have, a substantial ad- verse effect on interstate commerce. (citing authorities) (Emphasis added.) “[5] The actions of defendants are purely local in nature, restricted to the Ann Arbor area. Any effect their actions would have on interstate commerce is remote and inconse- quential. There is no evidence of an intent to restrain interstate commerce, or a substan- tial and actual restraint of interstate’ com- merce. Any conspiracy which only indirectly or incidentally affects and restrains inter- state commerce is not within the purview of Section 1 of the Sherman Act. (cite omitted) * * 7 25 “The ‘Restraint of Trade’, if any, is strictly a local problem. Plaintiffs should seek their remedy under state law. The court would not hesitate to entertain plaintiffs’ action if Sec- tion 1 of the Sherman Act had been violated, but it has not. Plaintiffs have failed to satisfy the interstate commerce requirement. They have been unable to satisfactorily demon- strate that defendants’ activities have oc- curred within the ‘flow’ of interstate com- merce, or that such activities have had a direct and adverse effect on interstate commerce.” at 1279-80. The district court dismissal of the plaintiffs’ action was appealed to the Court of Appeals for the Sixth Cir- cuit, which affirmed in a per curiam opinion quoting from the district court opinion that the defendants’ ac- tivities were local commerce and that the competition allegedly restrained and interfered with was local in nature, saying: “We agree with the district judge that plain- tiffs have not pleaded a Sherman Act case.” at 837. In Cotillion Club, supra, the alleged conspiracy was “ _. to create and carry out restrictions and restraints of interstate trade and commerce in the purchase, sale, transfer, financing, and oc- cupancy of real estate, including federally financed 26 and insured real estate and house accommodations in the Detroit Metropolitan Area.” (Emphasis added) The allegations to support federal jurisdiction were that some members of the defendant organizations re- ceived and transmitted information and listings to and from other states, that some such members made and filed applications, reports and other documents for transmittal to Washington, D.C. or other out of state offices of their various federal housing agencies and that some members of such organizations made in- vestigations, appraisals and surveys of federally financ- ed or insured Michigan real estate to be transmitted to other states. The court noted that nowhere in the complaint was there any allegation as to the extent or substantiality of these alleged interstate activities nor any allegation of interstate activities of the defendant association, as dis- tinguished from their members. The court further noted that*the allegations of the complaint failed to relate the alleged interstate activities of these members of the defendant associations to the alleged restraints complained of in the complaint. The court then said: “{1] Such incidental activities across state lines, by members of the defendants, do not establish the jurisdiction of this Court. The critical question is whether the alleged re- straints are operative in interstate commerce, 27 ard not whether the defendants’ members en- gage, in the overall conduct of their business, in incidental activities across state lines. * * * “(2] It is well settled that the Sherman Act was not designed to reach alleged restraints which are local in nature and do not substan- tially affect interstate commerce. .... a * * “It is clear from the complaint in this case that the restraints alleged relate only to the purchase and sale of real estate in the Detroit Metropolitan Area. It is competition for the purchase and sale of this real estate which is assertedly injured by the alleged restraints. This is local commerce and the competition al- legedly restrained and interfered with is local in nature. If one assumes the allegations to be true, they fail to allege facts showing that the restraints substantially burden interstate commerce.” at 853-4. The court observed that the relevant market in- volved was the sale of real estate in the Detroit Metropolitan Area and that the members of the defen- dants were licensed to sell real estate only in the State of Michigan (just as the defendants herein are licensed to sell real estate only in the State of Louisiana) and that the sales related to real property which was en- tirely local (just as the sales herein complained of are 28 alleged to be in the Greater New Orleans Area, Com- plaint Pars. XII, XIV). As to the alleged filing of applications, reports and other documents in connec- tion with federally insured real estate within the State of Michigan, the court said: ° The nature of these applications, reports, and other documents does not appear. The effect which the alleged re- straints have upon these ‘applications, reports, and other documents’ does not appear, nor does the extent of any such effect appear. There is no relationship established between the alleged restraint and the inci- dental activities involving mailings across state lines. “The complexity of modern business leaves little room for contracts, or business transac- tions, which cannot be said in some degree to affect interstate commerce. “[3] The effect on interstate commerce must be direct and not remote and must be the result of intent to restrain interstate com- merce, or there must be substantial and actual restraint of interstate commerce; and any con- spiracy which only indirectly or incidentally affects and restrains interstate commerce is not within the purview of this section.” at 854. In Manion v. Jefferson Board of Realtors, Civil Action No. ° 73-2604 of this Honorable Court, speaking through _ 29 Judge Gordon, dismissed a complaint virtually iden- tical with that herein and this dismissal was affirmed by the Court of Appeal for the Fifth Circuit in a mem- orandum opinion in its docket, No. 74-1901. No hold- ing to the contrary has been cited and it is accordingly quite clear that plaintiffs’ complaint must be dismissed for lack of jurisdiction. A copy of the transcript of the hearing on the Motion to Dismiss in Manion, supra, is at- tached as Exhibit “C.” Judge Gordon’s reasons for granting the motion are stated on pages 23-6. Goldfarb v. Virginia State Bar, U.S. ,44L.Ed.2d 572, 95 S.Ct. 2004 (1975), does not derogate from the holding in Marston, Cotillion Club or Manion, supra, be- ing entirely distinguishable on its facts and issues. The charge in Goldfarb, supra, was that operation of the Virginia State Bar minimum fee schedule, as applied to fees for legal services relating to residential real estate transactions, constituted price-fixing in violation of Section 1 of the Sherman Act. The Supreme Court's determination that the schedule and its enforcement violated the Sherman Act rested upon a careful con- sideration and analysis of “the nature of the transac- tions at issue and the place legal services play in those transactions. ....” at 582-3. The “transactions at issue” were various aspects of financing the purchase of real estate: “ ... petitioners .... contracted to buy a home in Fairfax County, Virginia. The fi- nancing agency required them to secure title 30 insurance; this required a title examination, .” at 578. No question was raised as to the sale or purchase by the petitioners of the home in question; the opinions of the district court, the Court of Appeal and the Supreme Court are all silent on the question whether the plain- tiffs’ purchase was made through a real estate broker but. if so, this phase of the transaction was complete and had passed out of the picture. In its careful definition of the “nature of the transac- tions at issue and the place legal services play in those transactions,” the Supreme Court adverted to the dis- _ trict court finding that a significant portion of funds furnished for the purchase of homes in Fairfax County came from without the State of Virginia and that significant amounts of loans on Fairfax County real es- tate were guaranteed by the VA and HUD, both of which were headquartered in the District of Columbia, in consequence of which: “... Thus in this class action the transac- tions which create the need for the particular legal services in question frequently are inter- state transactions. The necessary connection between the interstate transactions and the restraint of trade provided by the minimum fee schedule is present because, in a practical sense, title examinations are necessary in real estate transactions to assure a lien on a valid 31 title of the borrower. In financing realty pur- chases lenders require, ‘as a condition of mak- ing the loan, that the title to the property in- volved be examined ....’ Thus a title ex- amination is an integral part of an interstate transaction. ...” at 583. By contrast, in the instant case “The essential function of a Louisiana real es- tate broker consists of counselling pur- chasers or sellers of real estate situated in the State of Louisiana. Assisting them in es- tablishing the price of properties and bring- ing about agreements to purchase and sell. Brokers earn their commissions upon pro- curing a purchaser or seller, as the case may be, and have essentially completed their func- tion at that time.” (affidavit of Max Derbes, Jr. and Dalton L. Truax, Jr., Par. VII.) In contrast to the Supreme Court'’s finding of the “in- separability of this particular legal service from the interstate aspects of real transactions .. .” (at 583), which interstate aspects were the financing of the purchase of real estate, the role of the defendant real estate brokers in financing such purchases is neither integral nor inseparable. In Goldfarb, supra, the evidence reflected mortgage loans by out-of-state lenders in the State of Virginia of some Seventy-five Million Dollars for the years 1970 and 1971, VA loan guarantees in Fairfax County alone of One Hundred Five Million 32 Dollars in 1972 and HUD insurance of home mort- * gages in Fairfax County of Twenty-three Million ices at issue in Goldfarb, supra, appears clearly from foot- Dollars in 1972. The role played by real estate brokers | note 13 to the Supreme Court’s opinion reading as in Louisiana in financing credit sales is minimal: follows: “8. Real estate brokers do not obtain and are Bi poate gine 8 pe crates ' not instrumental in obtaining the financing of horns a Riots +g fe Pass credit sales except in situations in which the ; h aioe hie ot Oty hi 6: aa P EGS accepts a note secured by a Vendar’s ‘. . any 8 y d tk ae. SL Pe cura = as part of the purchase price. Essentially, rer it i . sitet Pee Fhe gr % . and in the overwhelming majority of cases, eld, inter alia, that intrastate taxi trips that occurred at the start and finish of interstate rail travel were ‘too unrelated to interstate commerce to constitute a part thereof within the meaning of the Sherman Act.’ 332 US, at 230, 91 L Ed 2010, 67 S Ct 1560. The ride to the railway station, we said, ‘[f]rom the stand- points of time and continuity . . . may be quite distinct and separate from the interstate jour- ney.’ Id., at 232, 91 L. Ed. 2010, 67 S Ct 1560. Here, on the contrary, the legal services are coincidental with interstate real estate trans- actions in terms of time, and more important, in terms of continuity they are essential. In- deed, it would be more apt to compare the legal services here with a taxi trip between stations to change trains ijn the midst of an interstate journey. In Yellow Cab we held that such a trip was a part of the stream of com- merce. Id., at 228, 229, 91 L Ed 2010, 67 S Ct 1560.” at 583. the obtaining of financing is handled by the purchaser directly with the lending institu- tion. “9. Real estate brokers are in no way con- nected with or participate in examination of titles in connection with the sale of real estate or financing of such sales.” (affidavits of Max Derbes, Jr. and Dalton L. Truax, Jr.) Paraphrasing the district court's opinion in Marston, supra: “The actions of defendants are purely local in, nature, restricted to the Greater New Orleans Area. Any effect their actions would have on interstate commerce is remote and inconse- quential.. . ” : The prior and separate nature of the services ren- dered by the defendants herein, in contrast to the serv- 1) 4 34 The critical importance of this distinction becomes even clearer upon a reading of the entire paragraph from which the court quotes in its footnote: “Here we believe that the common under- standing is that a traveler intending to make .interstate rail journey begins his interstate movement when he boards the train at the station and that his journey ends when he dis- embarks at the station in the city of destina- tion. What happens prior or subsequent to that rail journey, at least in the absence of special arrangement, is not a constituent part of the interstate movement. The traveler has complete freedom to arrive at or leave the station by taxi cab, trolly, bus, sub- way, elevated train, private automobile, his own two legs, or various other means of con- veyance. Taxicab service is thus but one of the many that may be used. It is contracted for in- dependently of the railroad journey and may be utilized whenever the traveler so desires. From the standpoint of time and continuity, the taxi cab trip may be quite distinct and sep- arate from the interstate journey. To the taxi cab driver, it is just another local fare.” at 2020-21 (Emphasis added.) Paraphrasing the Supreme Court’s language in Yellow Cab, supra: “A title examination is an integral part of an interstate transaction and is inseparable from ——'s — ss 35 the interstate aspects of real estate transac- tions. What happens prior or subsequent to the title examination, at least in the absence of some special arrangement, is not a constitu- ent part of the interstate transaction. The purchaser has complete freedom to make his agreement to purchase through a real estate broker, through a friend or relative cf the owner, through an attorney at law repre- senting the owner or directly with the owner himself, whether a builder or an occupant. Purchasing through a real estate broker is thus but one of many means of contracting to buy real estate. It is contracted for indepen- dently of financing the purchase where such financing is necessary and is entirely unre- lated to such financing. From the standpoints of time and continuity, the agreement to purchase is quite distinct and separate from subsequent financing arrangements.” That Goldfarb, supra, effected no change in the law as to the intrastat~ nature of real estate brokerage, but was decided on its special facts, is clear from the deci- sion of the Court of Appeals for the Eighth Circuit in Diversified Brokerage Services, Inc. v. Greater Des Moines Board of Realtors, 521 F.2d 1343 (8th Cir. 1975). Rejecting the plaintiff’s contention that Goldfarb was controlling, the court affirmed dismissal on jurisdictional grounds of an action for alleged violation of the Sherman Act in refusing to admit the plaintiffs to membership, The court pointed out that the plaintiffs 36 “ a ; ate pe effort to present evidence that endants intrastate activities subs tontially af- fect interstate commerce and therefore come within the purview of the Sherman Act even though they are not interstate in character.” (authorities cited) (Emphasis applied.) at 1345, . ee that the only basis for the plaintiffs’ conten- ion that the defendants were engaged in interstat commerce within the meaning of the Sherman Act w ; a few transactions to which out-of-state persons w 7 sire the court cited Yellow Cab’s, supra, holding eine rtf oe beginning or ending of a railroad journey Beary 0 ms an integral part of the stream of com- rit SO as to come within the Sherman Act and observed that the cases uniformly held that “ os tie mere movement of individuals from state to another in order to utilize f artic- ular services does not transform those serv- ices into interstate services within the mean- ing of the Sh ” (citi pg erman Act.” (citing authorities) at Th i sae ca ot that in Goldfarb, supra, the urt ruled that title examinati : tions were in i = ta tet acc of the interstate transactions and noted nls oe volume of commerce .involved” (at and observed that the plairtiffs had made no such showing. Consequently, 37 “ _ onthis record, the most that is shown by plaintiffs is some interstate movement of in- dividuals. That is not enough to establish jurisdiction in this case.” at 1347. The “nexus with interstate commerce” which the court found in the financing of real estate purchases in Goldfarb, supra, is clearly lacking in defendants’ purely local activity of bringing sellers and purchasers together and Goldfarb, supra, furnishes no precedents. The doctrine that there must be a showing of direct and substantial effect on interstate commerce was re- cently affirmed by the Court of Appeals for the Fifth Circuit in Rosemound Sand and Gravel Co. v. Lambert Sand and Gravel Co., 469 F.2d 416 (Sth Cir. 1972). Suit had been brought therein by a gravel producer against three competitors alleging that they had combined to inter- fere with an output-requirements agreement which the plaintiff company had arranged with a large con- struction company. The District Court had dismissed the complaint for lack of jurisdiction and the Fifth Cir- cuit affirmed. The court’s opinion is instructive: “ |. The complaint contains only the barest conclusory statements of jurisdiction and Rosemound has added little to shore up its ini- tially weak position. The answers to its inter- rogatories clearly show that the defendants. S- mine and sell sand and gravel only for ) Louisiana purchasers and that none of the 38 defendants products are shipped out of state or enter the flow of commerce. The deposi- tions of Rosemound’s partners establish that its business never got off the ground to any commercially recognizable extent. As found by the trial court, this failure of any party to have any interstate business disposes of the Clayton Act and Robinson-Patman Act claims. (citing authorities) While these intra- state activities could be found to violate the Sherman Act if they had a direct and substan- tial effect on interstate commerce, (citing authorities) evidence introduced below es- tablish no such connection. “If a combination could be shown to have existed here, its only purpose and effect would have been to interfere with the intrastate Louisiana Sand and Gravel business.” at 418- 19. . CONCLUSION As appears more fully fror: the foregoing dis- cussion, there is clear authority for the proposition that the activities of real estate brokers such as defendants herein are purely local in nature and not subject to the Sherman and Clayton Acts. The allegation in paragraph XIV that defendants assist in securing fi- nancing and insurance involved with the purchase of real estate is controverted by the recitals of the affi- davits of Messrs. Derbes and Triax and, as is more ful- SARPY ls} HARRY McCALL, JR. Harry McCall, Jr. 39 ly set forth hereinabove, financing znd title insurance are entirely separate from the activities of real esiate brokers. The conclusory allegations of paragraph XI that defendants’ activities “are within the flow of inter- state commerce and have an effect upon that com- merce” are clearly insufficient to vest jurisdiction. The complaint should be dismissed for lack of subject matter jurisdiction. Respectfully submitted, CHAFFE, McCALL, PHILLIPS, TOLER & (Names of Co-Counsel Omitted) (Certificate of Service Omitted) 40 DEFENDANTS’ EXHIBIT “A” IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION (Number and Title Omitted) AFFIDAVIT STATE OF LOUISIANA: PARISH OF ORLEANS: BEFORE ME, the undersigned authority, personally came and appeared MAX DERBES, JR., who, upon first being duly sworn, did depose and say: 1. I ama resident of the Parish of St. Tammany, State of Louisiana. 2. I am engaged in the business of a real estate broker with offices in the Parish of Orleans. I am duly licensed as a broker by the State of Louisiana since 1954. 3. Iam the first vice president of the Real Estate Board of New Orleans, Inc. and I have served on the Board of Directors of said organization for 7 years. 4. Insuch capacities, I have been and am familiar in considerable depth with the workings of the real estate market in the State of Louisiana. _— 41 5. The Broker’s License issued to me by the State of Louisiana authorizes me to perform the functions of a real estate broker in that State and no other; all real es- tate brokers in the State of Louisiana are similarly licensed. 6. There is no legal or other sort of requirement that the sale or purchase of real estate within the State of Louisiana be made through a real estate broker and I know of my own knowledge that in fact sales have been and are made without the interposition of real estate brokers; examples of such sales are direct sales by in- dividual owners, by builders, by friends or relatives or through attorneys at law. 7. The essential function of a Louisiana real estate broker consists of counseling purchasers or sellers of real estate situated in the State of Louisiana, assisting them in establishing the price of properties and bring- ing about agreements to purchase and sell. Brokers earn their commissions upon procuring a purchaser or seller, as the case may be, and have essentially com- pleted their function at that time. 8. Real estate brokers do not obtain and are not in- strumental in obtaining the financing of credit sales ex- cept in situations in which the Vendor accepts a note secured by a Vendor’s Lien as part of the purchase price. Essentially, and in the overwhelming majority of cases, the obtaining of financing is handled by the pur- chaser directly with the lending institution. 42 9. Real estate brokers are in no way connected with or participate in examination of titles in connection with the sale of real estate or financing of such sales. /s| MAX J. DERBES, JR. MAX DERBES, JR. (Jurat Omitted) DEFENDANTS’ EXHIBIT “B” IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA NEW ORLEANS DIVISION (Number and Title Omitted) AFFIDAVIT STATE OF LOUISIANA: PARISH OF ORLEANS: BEFORE ME, the undersigned authority personally came arid appeared, DALTON L. TRUAX, JR. who upon first being duly sworn, did depose and say: 1. lama resident of the Parish of Jefferson, State of Louisiana. 2. Iam engaged in the business of real estate broker with offices in the Parishes of Orleans, St. Tammany 43 and Jefferson. I am duly licensed as a broker by the State of Louisiana since 1960. 3. I am the Secretary of the Real Estate Board of New Orleans, Inc. and have served on the Board of Directors of said organization for five (5) years. 4. Insuch capacities I have been and am familiar in considerable depth with the workings of the real estate market in the State of Louisiana. 5. The Broker’s License issued to me by the State of Louisiana authorizes me to perform the functions of a real estate broker in that State and no other; all real es- tate brokers in the State of Louisiana are similarly licensed. 6. There is no legal or other sort of requirement that the sale or purchase of real estate within the State of Louisiana be made through a real estate broker and I know of my own knowledge that in fact sales have been and are made without the interposition of real estate brokers; examples of such sales are direct sales by in- dividual owners, by builders, by friends or relatives or through attorneys at law. 7. The essential function of a Louisiana real estate broker consists of counseling purchasers or sellers of real estate situated in the State of Louisiana, assisting them in establishing the price of properties and bring- ing about agreements to purchase and sell. Brokers 44 earn their commissions upon procuring a purchaser or seller, as the case may be, and have essentially com- pleted their function at that time. 8. Real estate brokers do not obtain and are not instrumental in obtaining the financing of credit sales except in situations in which the Vendor accepts a note secured by a Vendor’s Lien as part of the purchase price. Essentially, and in the overwhelming majority of cases, the obtaining of financing is handled by the pur- chaser directly with the lending institution. 9. Real estate brokers are in no way connected with or participate in examination of titles in connection with the sale of real estate or financing of such sales. ls} DALTON L. TRUAX, JR. DALTON L. TRUAX, JR. (Jurat Omitted) IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Mar. 25, 1976 MOTION FOR EXTENSION OF TIME TO ANSWER DEFENDANTS’ MOTION TO DISMISS Plaintiffs herein request this Court to grant an ex- tension of time to answer defendants’ motion to dis- miss, up through and including April 7, 1976, and to 45 continue the date for hearing this motion from March 31 to April 28, 1976, for the following reasons: 1. Pursuant to instructions from this Court, counsel for all parties agreed to a pretrial order con- taining a schedule for the orderly progress of this cause. This order was filed on January 5, 1976, and was signed as an order by this Court the same day. 2. Paragraph 1 of the pretrial order required that any motion by a defendant to quash service or object to the jurisdiction or venue of this Court be filed on or before sixty (60) days from January 5, 1976. Plaintiffs’ reply to such motion shall be filed within thirty (30) days of the service of said motion. Defendants’ reply, if any, is to be filed twenty (20) days thereafter. 3. Defendants filed a motion to dismiss for lack of subject matter jurisdiction with this Court on March 5, 1976, and plaintiffs received copies of this motion through letter dated March 8, 1976. Defendants notic- ed the motion for March 31, 1976. 4. Pursuant to the agreed timetable, plaintiffs are entitled to a thirty day time frame within which to rep- ly after service of the motion or up through and in- cluding April 7, 1976. 5. Furthermore, pursuant to the pretrial order, plaintiffs bear the responsibility of noticing said motions for hearing. 46 6. Defendants, through letter to plaintiffs’ counsel dated March 23, 1976, have suggested that in order to comply with the applicable time frames, that their mo- tion originally noticed for hearing on March 31, 1976, be rescheduled for either April 28, 1976 or May 26, 1976. ‘ Respectfully submitted, NELSON, NELSON & LOMBARD, LTD. Is/ PATRICIA SAIK Patricia Saik John P. Nelson, Jr. ORDER IT IS HEREBY ORDERED that defendants’ motion to dismiss, which is set for hearing on March 31, 1976, be reset for April 28, 1976, and that plaintiffs’ reply to defendants’ motion to dismiss be filed by April 7, 1976. New Orleans, Louisiana, this 25th day of March, 1976. ls) EDWARD J. BOYLE, SR. UNITED STATES DISTRICT JUDGE (Certificate of Service Omitted) 47 IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Apr. 8, 1976 PLAINTIFFS’ MEMORANDUM IN OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS I. Background and Procedural Posture Plaintiffs, buyers and sellers of residential property in the greater New Orleans area, have alleged that two trade associations and their broker members (realtors) have conspired to fix the price of brokering services of- fered to prospective buyers and sellers of residential real property in the greater New Orleans area. On January 5, 1976, counsel for all parties filed a pro- posed pretrial order to accommodate the complexity of this lawsuit and to establish an orderly procedural timetable. The proposed timetable became an order of this Honorable Court the same date. (See record, pretrial order signed by Honorable Edward J. Boyle on the Sth day of January, 1976.) This order precludes plaintiffs initiating discovery until all pretrial motions contemplated in paragraphs 1, 2 and 3 have been argued and disposed of by ruling. At that point, dis- covery is permitted only to determine whether this ac- tion is maintainable as a class action (see order, paragraph 4, page 3). 48 Plaintiffs have abided by this order and have ini- tiated no discovery; thus plaintiffs: must rely in large part on the jurisdictional allegations in their complaint to support their opposition to defendants’ present mo- tion to dismiss. Plaintiffs have, however, submitted several affidavits to support a showing that defen- dants’ brokering activities, an integral part of the entire real estate transaction, takes place in interstate com- merce and substantially affects that commerce (see complete discussion, infra). Defendants have jointly moved to dismiss this Sher- man Act! complaint on the basis that the brokering services which they dispense, or, in the case of the defendant boards who supervise, foster, aid, abet and educate, are neither within the flow of commerce nor affect interstate commerce.? Defendants substantiate this posture through two affidavits purporting that brokering services are wholly discrete from the pa nop- ly of actions involved in the purchase and sale of residential real property from beginning to-end. Plaintiffs offer the following memorandum to refute this nosition. To briefly summarize at the outset, it is plaintiffs’ position that a price fix presumes satisfaction ~1 15U.S.C. 1 (1964). 2 Generally speaking, under the antitrust laws, the interstate commerce element of the offense may be based on the fact that the acts complained of are within the flow of interstate commerce or that the activity substantially affects interstate commerce. Las Vegas Merchant Plumbers Ass'n v. United States, 210 F. 2d 732 (9 Cir. 1954). « 49 of Sherman Act jurisdictional requirements. Should the Court find this position insufficient, plaintiffs will show that defendants’ activities are an integral part of interstate commerce, that is, that defendants’ broker- ing services cannot be divorced from the economic con- tinuum of interstate activities necessary toculminate a real estate transaction. Not only do defendants service out-of-state buyers and sellers, but their work re- quires the use of telephone and mail communication across state lines. Further, their services include offer- ing assistance to both procure loans from interstate lending sources and to obtain title insurance from out- of-state insurance carriers. Although the purchase:and sale of realty is localized to the extent that real property is by nature an im- movable, the brokerimg activities can and do move in interstate commerce anc have a substantial effect on that commerce. But agaist «even if the services include no more than bringing a buyer ard seller together, this activity, because it is inextricably bound up with the en- tire buy/sell transaction, is sufficient to confer juris- diction. I]. Factual Summary Before turning to a full discussion of applicable legal principles which firmly support’ a showing of subject matter jurisdiction heve, plaintiffs must reemphasize and briefly explain each jrisdictional allegation con- tained in their complaint. Cf course, for purposes of a \ \ rte es 50 motion to dismiss, well-pleaded material allegations must be taken as true. See generally, 2A Moore’s Federal Practice, paragraph 12.08. At this juncture, it cannot be fairly said that in a factually complex suit such as this the standard for dismissal has been met — i.e., that it appears to a certainty that plaintiffs are en- titled to no relief under any state of facts which could be proved in support of the claim. Generally, courts like the Fifth Circuit, see, e.g., McBeath v. Interamerican Citizens for Decency Committee, 374 F.2d 359 (5 Cir. 1967), will not permit dismissal for lack of jurisdiction where the jurisdictional issue is closely entwined with the substantive one of whether an anti- trust violation has actually occurred. Given these pro- cedural precautions, plaintiffs submit that defendants’ motion to dismiss should be viewed with particular caution. Paragraph XI of plaintiffs’ complaint alleges gen- erally thai defendants’ activities are within the flow of interstate commerce and affect that commerce. This al- legation is substantiated by more particularized alle- gations pertaining to the volume of business carried on, the interstate movement of customers, and finally, the interstate movement of financing and title insurance services. A. Defendants Account For A Substantial Proportion Of Real Estate Brokering Services Performed In Connection With 51 The Purchase And Sale Of Real Estate In Greater New Orleans (Complaint, r paragraph XII). Absent discovery, plaintiffs are unable to provide the Court with the percentage of real estate transactions which take place through the services of the defendant realtors. Yet, even at this early juncture, defendants cannot deny that it is substantia!. For example, for the fiscal year ending August 31, 1975, defendant Stan Weber & Associates, Inc. reported residential sales of $56,340,345.00. The Times-Picayune, Sunday, October 19, 1975, front page classified section. Plaintiffs intend to prove that the other defendant realty companies likewise occupy a market position which in no way can be characterized as “inconsequential”. Although defen- dants argue that no one is required by state law to use their services, the fact is that thousands of persons do turn to the realtor — a professional — to assist in the now sophisticated and oftentimes complicated buy/sell transaction. B. Many Persons Using The Services Of The Defendants In Connection With The Purchase And Sale Of Real Estate Are Persons Moving Into And Out Of The Greater New Orleans Area. One of the plaintiffs, Irving Koch, lived out-of-state at the time that he enlisted a realtor to assist in his purchase of residential property in the New Orleans 52 area (see attached affidavit of Koch). The brokering | services rendered not only included actually locating suitable property, but the realtor utilized assisted Mrs. Koch with prices, marketing, information and financ- ing. Again, at this stage of the litigation, plaintiffs have not yet determined the actual percentage of transac- tions within the limitation period of this suit that in- volve out-of-state buyers and sellers. On information and belief, plaintiffs submit that this figure is sizeable. Taking a national statistic, in any one year, nearly 36 million people — about 18% of all those in the United States — change residences. About 6.6 million move across state lines. Cited in Austin, Real Estate Boards and Multiple Listing Systems As Restraints of Trade, 70 Columbia L. Rev. 1325, 1334, footnote 63. And sup- port exists to show that defendants recognize and attempt to capitalize on this substantial interstate movement of persons. For instance, the Times-Picayune reported on March 28, 1976, section 5, page 19, that defendant Gertrude Gardner has opened a special Relocation Center designed to assist companies in re- locating transferred personnel and to handle paper work involved in sales. Efforts like this just begin to demonstrate the importance that realtors play in secur- ing and/or disposing of residential property for persons moving into and out of metropolitan New Orleans. C. Defendants Assist Their Clients In Se- curing Financing And Insurance In- volved With The Purchase Of Real Estate eh ag 53 In The Greater New Orleans Area. Such Financing And Insurance Are Obtained From Sources Outside The State Of Louisiana And Move In Interstate Com- merce Into The State Of Louisiana Through The Activities Of The Defen- dants. Both the United States Department of Housing and Urban Development and the Veterans Administration make substantia! loan guarantees for the purchase of homes in metropolitan New Orleans (see attached af- fidavits of Paul Griener, Loan Guaranty Officer for the VA, and Angel Miranda, Area Economist for HUD). In 1975 alone, VA insured loans for the parishes of Jeffer- son and Orleans totaled over 55 million dollars. FHA loan operations for 1973 in Orleans Parish exceeded 6 million dollars. In short, there is no question that sub- stantial amounts of financing necessary for the purchase of residential property flow into Louisiana from out-of-state sources. Plaintiffs have alleged that realtors assist in pro- curing funds through interstate lending sources andin obtaining title insurance from out-of-state insurance carriers. Defendants have stated that brokers basically do not engage in either obtaining financing or title in- surance (see defendants’ affidavits of Max Derbes, Jr. and Dalton L. Truax, Jr.). But, at this point in the litiga- 54 tion, important facts as yet are undeveloped.3 Once dis- covery is initiated, amore complete picture of the realm of brokering services offered through defendants will be obtained and offered to support both jurisdictional and substantive Sherman Act requirements. Finally, it is plaintiffs’ position that given the allega- tion of a price fix, it is not a prerequisite to Sherman Act jurisdiction that defendants actually procure financing or title insurance. It is sufficient to show that defen- dants’ brokering activities are an integral part of the entire economic transaction of a real estate purchase and sale and that their concerted activity disturbs the interstate flow of persons, financing, and insurance services necessary to complete the real estate transac- tion. 3 Despite the fact that opposing affidavits have been submitted and the Court will be considering some material outside the-plead- ings, plaintiffs strongly urge that dismissal on the basis of a mo- tion for summary judgment would be improper. Not only are material facts in dispute, but other material facts are as yet undis- covered. “Rule 12(b)(6) requires that before a motion to dismiss may be treated as one for summary judgment the parties be given ‘reasonable opportunity to present all materials made pertinent to such by Rule 56’”. 6 Moore’s Federal Practice, paragraph 56.02 [3], pages 56-32. Incidentally, at least one basis for dis- tinguishing Page v. Work, 290 F. 2d 323 (9 Cir. 1961), a case on which defendants rely, is on procedural grounds. In Page, the par- ties in effect consented to a separate trial on the issue of jurisdic- tion and the court had before it a range of affidavits, oral testimony and the like. Since discovery here has not yet been ini- tiated, plaintiffs are unable to offer the Court all pertinent evi- dence and in no way have consented to “a separate trial on the issue of jurisdiction”. 55 IIL. Plaintiffs Have Satisfied The Sherman Act Jurisdictional Requirements. Sherman Act jurisdiction requires first that the alleged restraint emanate from a “trade” and second, that the restrained commerce be “among the several states”. See, 15 U.S.C. 1 (1964). Defendants have challenged the second requirement,‘ urging that the activity in which they engage begins and ends with bringing together a buyer and seller. In essence, they argue that their brokering services are-purely local in nature and have only a remote or inconsequential effect on interstate commerce. It follows, therefore, that their activities, even if illegal, cannot be reached by federal prohibitions. 3 It must be remembered that when Congress exer- cised its commerce power under the Sherman Acct, it utilized this power to its fullest extent. See, e.g., United States v. Frankfort Distilleries, Inc., 324 U.S. 293, 298 (1945). (“Congress, in passing the Sherman Act, left no area of its constitutional power unoccupied; it ‘exercised all the power it possessed’ ”). As such, intrastate activity is within the scope of federal reguiatory power if that ac- tivity “exerts a substantial economic effect on inter- 4 Indeed, questioning the first jurisdictional prerequisite would be near useless. In 1950, the U.S. Supreme Court clearly settled the issue of whether real estate brokering is a “trade” within the meaning of Section 1 of the Sherman Act. in United States v. National Association of Real Estate Boards, 339 U.S. 485 (1950), the court refused to exempt the real estate industry from Sherman Act coverage on the basis that it was not a “trade”. 56 ; state commerce.” Wickard v. Filburn, 317 U.S. 111, 125 (1942). Alternately, if the violative acts occur within the flow of commerce, Sherman Act jurisdiction is found as well. See, Las Vegas Merchant Plumbers Ass'n v. United States, 210 F. 2d 732 (9 Cir. 1954), for an enuncia- tion of these alternate bases for jurisdiction. These concepts will be discussed in detail, infra. But before- hand, plaintiffs address an important issue concerning jurisdictional requirements where a price fix is alleged. A. Where A Price Fix Is Alleged, Since Proof Of Interstate Effects Need Not Be Proved To Establish The Substantive Offense, Courts Can Presume Satisfaction Of Sherman Act Jurisdictional Require- ments. The heart of plaintiffs’ complaint alleges that defen- dants have combined and conspired together to fix, control, raise and stabilize the price of brokering serv- ices. (Complaint, paragraph XVI). Stated another way, the customers who utilize defendants’ services do not enter a competitive market. Instead, purchasers and sellers entering the market are confronted with a fixed brokerage fee, notwithstanding the actual value of the services performed or the realtor who performs the service. On information and belief, plaintiffs submit that in the vast majority of residential transactions, the brokering fee remains constant. Because plaintiffs have alleged a price fix con- spiracy, it is unnecessary for plaintiffs to prove the ieee 57 degree that the agreement affects interstate com merce. Under the Sherman Act, a combination formed for the purpose and with the effect of raising, depress- ing, or stabilizing the price of a commodity in inter- state commerce is illegal per se. United States v. Socony- Vacuum Oil Co., 310 U.S. 150 (1940). Indeed, proof of the degree or effect that concerted activity has on inter- state commerce is not a constitutional or jurisdictional prerequisite to the assertion of federal power. Socony- Vacuum, supra, at 485, note 59. In other words, the con- duct itself, that is, the agreement to fix prices, is con- sidered so harmful that additional proof of effects on interstate commerce is unnecessary. The adverse com- petitive effects are conclusively presumed from the mere existence of the conduct. See also, Burke v. Ford, 389 U.S. 320, 321-322 (1967). (Court presumed per se violation inevitably affected interstate commerce); Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 240-41 (1948) (inevitable effect of price fix agreement is to reduce competition).5 5 Although defendants rely on Manion v. Jefferson Board of Realtors, Civil Action No. 73-2604, for support that real estate brokering is a purely local activity that has only a remote effect on srnanence. this case is inapposite here. Before ruling, Judge Gordon was twice informed that Manion had not alleged price-fixing (see oe transcript, pp. 10, 12). Therefore, the court was not con ronte with the legal effect of alleging a per se violation. The Manion _ can also be distinguished on factual grounds. To support a on ic- tional showing, Manion apparently relied almost exclusive y ona showing of incidental activities, such as purchasing supp y in interstate commerce (Manion transcript, p. 25). Plaintiffs = allege a far more substantial basis for interstate peer §arh isa “ important to note that realtors themselves, the real links in a4 real estate transaction, were not named as defendants. As such, the court took no consideration of the actual brokering activities and the part these activities play in interstate commerce. 58 B. Defendants’ Brokering Activities Take Place In Commerce And Affect Inter- state Commerce. Although plaintiffs contend it is not necessary to prove the interstate effects which defendants’ alleged price-fixing conspiracy generates, plaintiffs can dem- onstrate that defendants’ brokering activities take place in commerce, and are an integral part of that com- merce. Plaintiffs wish to stress that brokering services are an intangible® and as such, it becomes more difficult to conceptualize the movement of this product across state lines. It is partly because of this elusiveness of definition that plaintiffs demonstrate the interstate nature of the service by describing the specific acts of contact and communication in which the realtors engage. The conclusory description of “merely bring- ing a buyer and seller together” downplays the numerous contacts, many of which are interstate, which a realtor initiates and receives in his or her effort to successfully conclude a buy/sell agreement and thus earn a commission. 6 There is no problem with the fact that it is “services” that con- stitute the economic continuum and affects interstate commerce. See, e.g., Associated Press v. United States, 326 U.S. 1 (1945); United States v. Southeastern Underwriters Association, 322 U.S. 533, 546 (1944), Southeastern Underwriters, supra at 539, is also important for the proposition that activities are in commerce where substantial quantities of documents, communication and money travel across state lines. Such activity is generated here by the fact that realtors service out-of-state buyers and sellers. Lee ee oe 59 Practically speaking, a buyer cannot#purchase a house without financing. As described above, millions of dollars flow from out-of-state to enable willing buyers to also become able ones. Similarly, a buyer wants a piece of land free of title defects. So does that buyer’s bank or other lending institution. Taking the other side, a seller simply cannot sell without some guarantee that the purchaser will not later face.a law- suit by an heir or prior owner. The realtor is in effect caught in the middle of these demands and/or pre- requisites to culminating a contract between a buyer and a seller. Even if the realtor does not participate in obtaining financing or insurance, which plaintiffs do not here concede, that realtor is no less an integral and oftentimes indispensable part of that entire economic process. It is on this basis that plaintiffs urge that defendants’ brokering services clearly are intertwined with interstate commerce — the movement of persons, the flow of money, the establishment of com- munications, the struggle for business. A realtor earns a commission only upon the successful culmination of a number of transactions, many of which flow in com- merce. Because the brokering service is thus such an in- tegral part of the successful culmination of the buy/sell contract, a price-fixing conspiracy for the costs of brokering services substantially affects commerce for Sherman Act purposes.’ 7 Cf, Mandeville Island Farms, Inc. v. American Crystal Sugar Company, 344 U.S. 219 (1948). The court in Mandeville Farms set up a single formula for determining whether commerce was affected within the meaning of the Sherman Act: the relationship between the conduct complained of and the economic totality adversely affect- ed by that conduct. Plaintiffs here request this Court to do the same. 60 Plaintiffs submit that the activities described above are sufficient to confer Sherman Act jurisdiction. The United States Supreme Court’s recent pronounce- ment in Goldfarb v. Va. State Bar, U.S. , 44 L. Ed. 2d 572 (1975), provides sound precedent for up- holding subject matter jurisdiction here. Chief Justice Burger (for a unanimous court) thoroughly answered the issue of whether the services performed by at- torneys in examining titles in connection with financ- ing the purchase of real estate are in interstate com- — merce or affect commerce. The court relied on district court findings of fact (see Goldfarb v. Va. State Bar, 355 F. Supp. 491, 494 (E.D. Va. 1973) and noted that a sig- nificant portion of funds furnished for the purchasing of homes in Fairfax County comes from without the State of Virginia and significant amounts of loans on Fairfax County real estate are guaranteed by the Unit- ed States Veterans Administration and Department of Housing & Urban Development, both headquartered outside Virginia. Goldfarb, 44L. Ed. 2d at 583.8 Further, the court soundly rejected defendant’s view that the legal services performed were wholly intrastate and could not therefore substantially affect commerce. 8 Plaintiffs wish to point out that procedurally speaking the jurisdictional issue in Goldfarb was apparently reserved until the parties had ample time for pretrial discovery and a full presenta- tion of evidence could be made at trial. At this point, plaintiffs are unable to offer the entire range of evidence, which they can and will produce after discovery has commenced. However, the alle- gations in the compiaint, especially paragraph XIV, speak directly to the large volume of interstate loans and for purposes of this mo- tion, should be taken as true. 61 “_. the transactions which create the need for the -particular legal services in question frerwently are interstate transactions. The necessary connection between the interstate transactions and the restraint of trade pro- vided by the minimum fee schedule is present because, in a practical sense,? title ex- aminations are necessary in real estate trans- actions to assure a lien on a valid title of the borrower. In financing realty purchases lend- ers require ‘as a condition of making the loan, that the title to the property involved be ex- amined .. .’ Thus a title examination is an in- tegral part of an interstate transaction. x*w “Given the substantial volume of commerce involved, and the inseparability of this par- ticular legal service from the interstate aspects of real estate transactions we con- clude that interstate commerce has been suf- ficiently affected. See Montague Co. v. Lowry, 193 U.S. 38, 45-46 (1904); U.S. vs. Women’s Sportswear Ass‘n, 336 U.S. 460, 464-465 (1949).” Goldfarb, 44 L. Ed. 2d. at 583. The basis on which defen- dants herein seek to distinguish Goldfarb concerns whether brokering services are sufficiently entwined 9 Thecourt notes here that it is in a practical sense that we must view an affect on interstate commerce, citing Swift and Co. v. United States, 196 U.S. 375, 398 (1905) and Mandeville Farms v. American Crystal Sugar Co., 334 U.S. 219, 233 (1948). 62 with, inter alia, the interstate movement of funds which are necessary to finance the underlying purchase and sale transaction. Plaintiffs strongly believe that pragmatism and the sophistication of today make impossible the severance of brokering services which defendants offer from the interstate aspects of a real estate transaction. For ex- ample, although-it is true that the use of brokering services are not required by state law, one cannot ig- nore the fact that defendants actively solicit participa- tion in the real estate trans. tion and that a substan- tial volume of real estate transactions occur through defendant realty companies. Furthermore, it must be stressed again that realtors are acutely concerned with whether a potential buyer is able to obtain financing. Such financing is esseritial to the culmination of the sale. Absent financing, the realtor will earn no brokering commission. In addition, no commissions are earned without an unencumbered title, guaranteed by a title search and/or title insurance. Finally, the substantial movement of persons into and out of the greater New Orleans area whoare seeking to either buy or sell residential property creates a healthy demand for brokering services. Plaintiffs submit that defendants’ activities in matching buyers who are ready, willing and able to purchase, with sellers who have chosen to use professional services to facilitate the sale of their property, is in the words of the Goldfarb court, “an integral part of an interstate transaction”. 63 Diversified Brokerage Services, Inc. v. Greater Des Moines Board of Realtors, 521 F. 2d 1343 (8 Cir. 1975), does not assist defendants here. The plaintiff in Diversified Broker- age, seeking admittance to the realty board, charged the board with a bottleneck boycott or a concerted refusal to trade. To support a jurisdictional showing, plaintiff showed that five real estate transactions (from a sam- ple of 16% of the listings) involved persons residing out of state. Absolutely no other evidence of interstate ac- tivity was provided and, on this basis alone, the court upheld the district court’s dismissal of the complaint. Three points which adequately distinguish the case from the instant one must be made. First, and most importantly, the plaintiffs here do not rely solely on the interstate movement of persons to support a jurisdictional showing. Interstate move- ment of funds for loans and insurance are also present. This is particularly significant since the Diversified Brokerage court, though holding that the interstate movement of persons was not enough to confer subject matter jurisdiction, added a caveat: “We emphasize the limited nature of our holding. Services affecting real estate, such as broker- age services, may, depending on the evidence, either constitute interstate activities or have no nex- us with interstate commerce. (Citing Goldfarb, 95S. Ct. at 2012). In the instant case, plaintiff presented extremely limited evidence and failed to show any interstate character to 64 these real estate transactions.” Diversified Brokerage, supra, at 1347. Secondly, the court noted that plaintiffs had been afforded full opportunity for discovery.1° This, of course, is not the situation here. Finally, unlike the plaintiff in Diversified Brokerage, who conceded in district court that the substantive and jurisdictional issues were not so intertwined as to preclude a jurisdictional ruling prior to trial on the merits, plaintiffs here strongly disagree and make no such concession at this early juncture. To briefly summarize through a descriptive analogy, plaintiffs submit that the defendants are the chemists who mix the substantial interstate and intrastate elements of a real estate transaction to form the “sale” compound. The defendants .annot deny that their catalytic complicity affects the flow of interstate com- merce. IV. Summary and Conclusion Plaintiffs submit that defendants’ motion to dismiss should be denied based on the following: 10 Suit was filed March 24, 1971, and was dismissed ilec ; three years later, after plaintiffs had been accorded a full opportunity . pre- sent more facts. For a complete procedural explanation, see Diver- sified Brokerage, supra, at 1347, footnote 3. 65 1. Procedurally speaking, motions to dismiss are strongly disfavored, particularly in antitrust suits where the jurisdictional and substantive elements of proof comingle. Because pretrial discovery has thus far been precluded pursuant to the pretrial order, plaintiffs have not yet had a full opportunity to substantiate the jurisdictional allegations in their complaint. But taken as true, as they must for purposes of this motion, the allegations support the requisite jurisdictional re- quirements.!! 11 Since the Court has before it materials outside the pleadings (i.e., various affidavits submitted by both plaintiffs and defen- dants), the motion to dismiss may be converted to one for sum- mary judgment. In support of plaintiffs’ position that a summary judgment mo- tion in this case should be denied, besides the comments in foot- note 3, supra, plaintiffs offer the following: “In a summary judgment situation, the court may con- sider admissions and facts conclusively established but all reasonable doubts touching the existence of a genuine issue as to material fact must be resolved against the mo- vant.” United States v. Farmers Mutual Insurance Ass'n of Kiron, lowa, 288 F. 2d 560, 562 (8 Cir. 1961). “The motion for summary judgment may be made by any party in any type of action. But by its nature summary judgment is apt to be ill-adapted to cases of a complex nature or to those that involve constitutional or other large public issues, which often need the full exploration of trial. A difficult question of law does not, however, warrant the denial of a motion for summary judgment, subject to the following important qualification: that the material factual issues are not in dispute and furnish an adequate basis for the application of the proper legal prin- ciples.” 6 Moore’s Federal Practice, paragraph 56.15 [1.- O}, p. 56-398. Plaintiffs submit that where, as here, the case itself is complex, the depth and range of the brokering services rendered are in dispute, and the parties have not yet commenced discovery, defendants’ motion should be denied. ; 66 2. Because plaintiffs have alleged a price-fixing conspiracy, once it is demonstrated that defendants’ ac- tivities occur in commerce, the adverse effect on inter- state commerce follows as a matter of law. At least part of defendants’ brokering activities cross state lines, and it can be presumed that interstate commerce is affect- ed thereby. 3. Even viewing defendants’ brokering activities as wholly intrastate ones, these activities cannot prac- tically be divorced from the interstate movement of conventional and government financing, title in- surance services and the movement of buyers and sell- ers into the greater New Orleans area. The realtor can- not earn a commission unless the buyer has financing and the seller produces marketable title. As such, the realtor’s services depend on and affect the interstate flow of both services and people. Based on the foregoing memorandum, plaintiffs re- quest this Court to deny defendants’ motion to dismiss. Respectfully submitted, NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion Is) PATRICIA SAIK _ Patricia Saik, Trial Attorney John P. Nelson, Jr., Trial Attorney (Certificate of Service Omitted) 67 STATE OF LOUISIANA PARISH OF ORLEANS BE IT KNOWN, that on the 7th day of April, 1976, before me, Notary, duly commissioned in the Parish of Orleans and therein residing, personally came and appeared: IRVING HIRSCH KOCH who first being sworn did depose and say: That he is a resident of the Parish of Orleans, of age, and married and resides at 4141 State Street Drive, New Orleans, Louisiana; That he is a named plaintiff in Civil Action No. 75- 3402 entitled James Jefferson McLain vs. New Orleans Real Estate Board, et. al.; 4 That prior to moving to New Orleans he and his wife were residents of Dayton, Ohio; That he purchased residential real estate in the City of New Orleans through the assistance and services of a Realtor member of the New Orleans Real Estate Board; That in procuring his residential real estate, his wife, Susan Goldstein Koch, made several trips to New Orleans to search for suitable homes prior to moving to New Orleans in 1979; 68 That on these trips and pursuant thereto a real estate broker personally or through an authorized agent assisted her with prices, marketing, information, and financing. THUS DONE AND SAID BEFORE ME, Notary, on the 7th day of April, 1976, in my office in Orleans Parish before the undersigned competent witnesses after due reading of the whole. | Is) IRVING H. KOCH IRVING HIRSCH KOCH (Jurat and Witnesses Omitted) AFFIDAVIT STATE OF LOUISIANA PARISH OF ORLEANS I, PAUL GRIENER, Loan Guaranty Officer for the Loan Guaranty Division of the Veterans Administra- tion, which administers all V.A. programs in the State of Louisiana, do hereby declare that the loan guaranties for the Parish of Jefferson and the Parish of Orleans, from 1973 through 1975, as well as a summation of total loan guaranties from 1945 through December, 1975, are accurately presented in Schedule A which is attached. These figures are based on our records and | 69 feel that they accurately represent V.A. loan guaran- ties during the applicable period. New Orleans, Louisiana, this 2nd day of April, 1976. ls) PAUL GRIENER PAUL GRIENER I have signed Schedule 1 toindicate its authenticity. ls) PAUL GRIENER PAUL GRIENER WITNESSES ls) IRVING H. KOCH ls) MARGARET SAUCHON STATE OF LOUISIANA PARISH OF ORLEANS BEFORE ME, the undersigned authority, duly com- missioned and qualified within and for the State and Parish aforesaid, personally came and appeared IRV- ING H. KOCH, who being by me first duly sworn, did depose and say: That he was a witness, along with Margaret Souchon to the above and foregoing instrument; that he saw 70 Paul Griener sign the same in his presence and that of the other witness, and knows of his own knowledge that the said parties executed said instrument of their own free will and accord,for the uses, purposes and benefits therein expressed. IN WITNESS WHEREOPF, the said appearer has ex- ecuted this acknowledgment in my presence and in the presence of the undersigned competent witnesses on this 2d day of April, 1976. Is} IRVING H. KOCH IRVING H. KOCH WITNESSES: Is) SHIRLEY LOVE Is) MATILE B. GOLDBERG Is) MICHAEL A. DENNER ernie Me NOTARY PUBLIC SCHEDULE A V.A. INSURED LOANS (LOAN GUARANTIES) APPROX. 1945 - DEC. 1975: JEFFERSON: 24,706 Homes $423,813,120.00 ORLEANS: 21,209 Homes $296,379,717.00 71 1972 — NOT AVAILABLE 1973: JEFFERSON: ORLEANS: 1974: JEFFERSON: ORLEANS: 1975: JEFFERSON: ORLEANS: COMPUTER STATS FROM: 1066 Homes $27,157,118.00 807 Homes $19,132,060.00 978 Homes $26,804,480.00 710 Homes $19,128,685.00 1096 Homes $33,333,820.00 674 Homes $20,126,700.00 New Orleans Regional Office of V.A. Loan Guaranty Division Paul A. Griener Loan Guaranty Officer Veterans Administration April 2, 1976 72 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) MINUTE ENTRY Filed: Apr. 28, 1976 CAUSE SHERMAN ACT & CLAYTON ACT UNLAWFUL CONSPIRACY TO KESTRAIN INTER- STATE TRADE & COMMERCE IN THE OFFERING FOR SALE AND SALE OF REAL ESTATE BROKER- ING SERVICES. WEDNESDAY, APRIL 28, 1976 10:00 A.M. (M & O Cont’d 3/25/76) MOTION OF DEFENDANTS, REAL ESTATE BOARD OF NEW ORLEANS, INC., ET AL, TO DiS- MISS. Motion to be continued on written motion. DATE OF ENTRY: APR. 28, 1976 73 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Apr. 27, 1976 MOTION AND ORDER Now into Court through their undersigned counsel come Defendants herein, and on suggesting to the Court that the pre-trial order entered by the Court and approved by counsel for the Plaintiffs and Defendants on 5 January 1976 provides in Paragraph 1 that any mo- tion by Defendants to quash service or to object to the - jurisdiction or venue of this Court shall be filed on or before sixty days from the date hereof; Plaintifts’ reply shall be filed within thirty days of service of said mo- tion; and Defendants; response shall be filed within twenty days; and on further suggesting to the Court that Defendants filed a motion to dismiss for lack of jurisdiction on 5 March 1976; and on further suggest- ing that on Plaintiffs’ motion, this Court granted an ex- tension of time to allow Plaintiffs through 7 April 1976 to answer Defendants’ motion to dismiss, which answer was filed on or about 7 April 1976; and on further suggesting to the Court that by the seme mo- tion, Plaintiffs requested and obtained a continuance of the hearing on said motion to dismiss to 28 April 1976; and on further suggesting to the Court that under the schedule set out in the pre-trial order and referred to hereinabove, Defendants’ reply to Plaintiffs’ answer would be due on the day of or the day before said hear- 74 ing; and on further suggesting to the Court that the parties hereto have agreed to a continuance of the hearing on Defendants’ motior to dismiss to 26 May 1976, and to an amendment of Paragraph 1 of the pvre- trial order to extend the time within which Defendants may reply to Plaintiffs’ answer to the motion to dismiss through 14 May 1976, Defendants move this Honor- able Court to enter an order amending Paragraph 1 of the pre-trial order in conformity with the foregoing and continuing the hearing on Defendants’ motion to dismiss to 26 May 1976 at 10:00 a.m. or as soon there- after as counsel may be heard. CHAFFE, McCALL, PHILLIPS, TOLER & SARPY ls} HARRY McCALL, JR. Harry McCall, Jr. 1500 First Nat'l Bank of Commerce Pldg. New Orleans, La. 70112 (529-3121) ORDER IT IS HEREBY ORDERED that Defendants’ motion to dismiss, which is set for hearing on 28 April 1976, be reset for 26 May 1976, and that Defendants’ reply to Plaintiffs’ answer to the motion to dismiss be filed by 14 May 1976. 75 New Orleans, Louisiana, this 28th day of April, 1976. ls} EDW. J. BOYLE, SR. UNITED S fATES DISTRICT JUDGE ‘(Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA MINUTE ENTRY BOYLE, J: (Filed: May 12, 1976) IT IS ORDERED BY THE COURT that the follow- ing motions presently fixed for hearing on Wednesday, May 26, 1976 at 10:00 A.M. be, agd the same are hereby continued to Wednesday, June 2, 1976 at 10:00 A.M. * * -_ * C.A. 75-3402 — JAMES JEFFERSON McLAIN, ET AL v. REAL ESTATE BOARD OF NEW ORLEANS, INC., ET AL ATTORNEYS: John P. Nelson, Jr., Esq., and Ms. Patricia Saik, and Raymond J. Munna, Esq. Ms. Cynthia Samuel 76 Arthur L. Ballin, Esq., and Frank C. Dudenhefer, Esq. Edward F. Wegmann, Esq., and F. P. Westenberger, Esq. Harry S. Redmen, Jr., Esq., and Rutledge Clement, Jr., Esq. Leon Sarpy, Esq., and Gerald Wasserman, Esq. Charles F. Barbera, Esq. * * * * Is} EDW. J. BOYLE, SR. UNITED STATES DISTRICT | JUDGE IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: June 2, 1976 MINUTE ENTRY CAUSE SHERMAN ACT & CLAYTON ACT UNLAWFUL CONSPIRACY TO RESTRAIN INTER- STATE TRADE & COMMERCE IN THE OFFERING FOR SALE AND SALE OF REAL ESTATE BROKER- ING SERVICES. 77 WEDNESDAY, JUNE 2, 1976 MOTION OF DEFENDANTS, REAL ESTATE BOARD OF NEW ORLEANS, INC., ET AL, TO DIS- MISS. Argument Plaintiff has 10 days to submit supplemental memoranda, with unreported cases, etc. Defendant has 10 days thereafter to respond. SUBMITTED. IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: June 10, 1976 MOTION FOR EXTENSION OF TIME Plaintiffs herein respectfully request an extension of time in which to file a supplemental memorandum in opposition to defendants’ motion to dismiss based on the following: 1. OnJune 2, 1976, this Courtheard oral argument on defendants’ motion to dismiss for lack of subject matter jurisdiction. 78 2. At the conclusion of the argument, plaintiff was given ten days in which to file supplemental memoran- dum. 3. Plaintiffs’ counsel has obtained copies of three orders in private antitrust cases brought pursuant to Section 1 of the Sherman Act against real estate boards and/or realtors wherein the courts denied defendants’ motion to dismiss for lack of jurisdiction. Copies of these orders are attached hereto. 4. These orders do not contain written reasons for the decision and plaintiffs’ counsel has requested through the respective offices of the clerk of court that copies of the complaint, any amended complaints, and plaintiffs’ memorandum in opposition to defendants’ motion to dismiss in all three cases be sent to plaintiffs’ counsel. 5. Since the requested pleadings should arrive on or about the same time plaintiffs’ memorandum is due, i.e., June 14, 1976, plaintiffs request that the time for filing the memorandum be extended toJune 18, 1976. 6. Plaintiffs’ counsel has contacted Mr. Harry Mc- Cali, Jr., lead counsel for defendants, and has been authorized to state that he has no objection to an exten- sion of time. Respectfully submitied, NELSON, NELSON & LOMBARD, LTD. 79 A Professional Law Corpora- tion is) PATRICIA SAIK Patricia Saik ORDER IT IS ORDERED that the time in which plaintiffs are to file their supplemental memorandum is hereby ex- tended from June 14 to June 18, 1976. Dated: June 10, 1976 ls} EDW. J. BOYLE, SR. UNITED STATES DISTRICT JUDGE (Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Aug. 26, 1976 Minute Entry August 25, 1976 BOYLE, J. A conference will be held in this case on Friday, September 3, 1976, at 3:00 P.M. 80 81 Id this day. John P. Nelson, Jr., Esq. A conference was held this day Ms. Patricia Saik Present: Ms. Patricia Saik Arthur L. Ballin, Esq. ! For Plaintiffs Charles F. Barbera, Esq. Arthur L. Ballin, Esq. ror Real Estate Board of Moise W. Dennery, Esq. New Orleans, Inc Harry McCall, Jr., Esq. f ’ Rutledge Clement, Jr., Esq. Roy L. Price, Esq. For Gertrude Gardner, Inc. Harry S. Redmon, Jr., Esq. Edward F. Wegmann, Esq. Ms. Cynthia Samuel For Waguespack, Pratt, Inc. Leon Sarpy, Esq. Charles F. Barbera, Esq. Edward F. Wegmann, Esq. For Stan Weber and Aésociates, Inc. Ms. Cynthia Samuel DATE OF ENTRY: AUG. 26, 1976. » For Sandra, Inc. Harry McCall, Jr., Esq. For Isabelle C. McLeod IN THE UNITED STATES DISTRICT COURT Not Present: FOR THE EASTERN DISTRICT OF LOUISIANA Roy L. Price, Esq. For Jefferson Board of (Number and Title Omitted) Realtors, Inc. Moise Dennery, Esq. Filed: Sept. 8, 1976 For Latter & Blum, Inc. Minute Entry September 3, 1976 BOYLE, J. Mr. Ballin declared he would represent Roy L. Price, Esq., and Mr. McCall that he would represent Moise Dennery, Esq. 82 Under submission is defendants’ motion to dismiss for lack of jurisdiction, premised upon the failure of plaintiffs to satisfy the interstate commerce require- ment of the antitrust law under which their action proceeds. The Court advised counsel that it appears plaintiffs may satisfy said jurisdictional requirement only by bringing the facts of this case within the parameters of the Supreme Court's holding in Goldfarb v. Virginia State Bar, 421 U.S. 773, 95 S. Ct. 2004, 44 L. Ed. 2d 572 (1975). It is recognized, however, that further dis- covery is needed on the issue of Goldfarb's applicability sub judice. More specifically, such discovery should determine whether, in the first place, there is the re- quisite interdependence between the brokerage activi- ty of defendants and the financing and/or insuring of real estate transactions in the New Orleans area and, secondly, whether there is a substantial involvement of interstate commerce in such real estate transactions via the financing and/or insurance aspects thereof. The parties shall confer with regard to the procedure of discovery along these lines. Following such dis- cussions, another conference will be held in thismatter at 4:00 P.M. on Wednesday, October 13, 1976. EJB Roy L. Price, Esq. Moise Dennery, Esq. 83 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 17, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) PLEASE TAKE NOTICE that at 9:00 a.m. on the 28th day of December, 1976, at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, the plaintiffs in the above entitled action will take the deposition of MR. MEAHER PATRICK TURNER whose address is Dept. of Housing & Urban Development, Deputy Director for Hous. & Mortgage Prod., 1001 Howard Ave., New Orleans, La. upon oral examination pur- suant to the Federal Rules of Civil Procedure, before a Notary Public or some other officer authorized by law to administer oaths. The oral examination will con- tinue from day to day until completed. You are invited to attend and take such part in the examination as shall be fit and proper. DATED: December 17, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion 84 Is} PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) - IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 17, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) Nees PLEASE TAKE NOTICE that at 2:00 p.m. on the 27th day of December, 1976, at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, the plaintiffs in the above entitled action will take the deposition of a corporate officer of GERTRUDE GARDNER, INC. whose address is 7934 Maple Street, New Orleans, Louisiana, upon oral examination pursuant to the Federal Rules of Civil Procedure, before a Notary Public or some other officer authorized by law to ad- minister oaths. The oral examination will continue from day to day until completed. You are invited to at- 85 tend and take such part in the examination as shall be , fit and proper. DATED: December 17, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion /s/ PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 17, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) PLEASE TAKE NOTICE that at 2:00 p.m. on the 28th day of December, 1976, at the law offices of 86 Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, the plaintiffs in the above entitled action will take the deposition of MR. JAMES MILLS whose address is Lawyers’ Title In- surance Corporation, 822 Gravier Street, New Orleans, Louisiana upon oral examination pursuant to the Federal Rules of Civil Procedure, before a Notary Public or some other officer authorized by law to ad- minister oaths. The oral examination will continue from day to day until completed. You are invited to at- tend and take such part in the examination as shall be fit and proper. DATED: December 17, 1976. NELSON, NELSON & , LOMBARD, LTD. A Professional Law Corpora- tion /s/ PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) 87 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 17, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) PLEASE TAKE NOTICE that at 3:00 p.m. on the 28th day of December, 1976, at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, the plaintiffs in the above entitled action will take the deposition of MR. PAUL GRIENER whose address is Vets. Ad- ministration, Loan Guaranty Div., 701 Loyola Ave., New Orleans, Louisiana upon oral examination pur- suant to the Federal Rules of Civil Procedure, before a Notary Public or some other officer authorized by law to administer oaths. The oral examination will con- ~ tinue from day to day until completed. You are invited to attend and take such part in the examination as shall be fit and proper. DATED: December 17, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion 88 ls} PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 17, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) PLEASE TAKE NOTICE that at 11:00 a.m. on the 28th day of December, 1976, at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, the plaintiffs in the above entitled action will-take the deposition of MR. ANGEL V. MIRANDA whose address is Dept. of HUD, Area Economist, 1001 Howard Avenue, New Orleans, Louisiana upon oral examination pursuant to the Federal Rules of Civil Procedure, before a Notary Public or some other officer authorized by law to ad- minister oaths. The oral examination will continue from day to day until completed. You are invited to at- 89 tend and take such part in the examination as shall be fit and proper. DATED: December 17, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion ls|/ PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 21, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) Notice is given herewith that pursuant to Rule 30(b) of.the Federal Rules of Civil Procedure, the deposition of JULIAN HECKER (of CARRUTH MORTGAGE _ 90 CO.) will be taken on oral examination at the law of- fices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, on December 30, 1976, at 11:00 a.m., and at any and all ad- journments thereof. The above named individual whose deposition is be- ing taken is hereby notified to appear for this deposi- tion and to bring with her: 1, Copies of all forms presently used for loan applications. Any documents showing the names and ad- dresses of all homesteads, real estate companies, brokers and realtors with whom your company is doing business or since October 31, 1971, have done business with in the past. Any documents containing the names and ad- dresses and amounts of residential real estate loans placed or applied for or sold to the follow- ing for each year from 1971 through 1975: Finance companies; Homesteads; Mutual savings banks; Insurance companies; Other mortgage companies or brokers; Government or quasi-governmental agen- cies (including for example, FHA (Federal Housing Authority), VA (Veterans Ad- ministration), FNMA _ (Federal National moana oe 91 Mortgage Association) and GNMA (Government National Mortgage Associa- tion)). Financial statements or other documents show- ing the volume of: a. Residential real estate loans carried by Carruth. b. Residential real estate loans placed with others. c. Residential real estate loans sold to other (in- cluding governmental agencies). d. Residential real estate loans carried with title insurance. Documents supporting the number, volume and percentage of total loans placed or carried with out-of-state lenders or borrowers and out-of- state sellers or purchasers of residential real property. DATED: December 21, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion Is} PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) 92 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT Or LOUISIANA (Number and Title Omitted) Filed: Dec. 21, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) Notice is given herewith that pursuant to Rule 30(b) of the Federal Rules of Civil Procedure, the deposition of EDMOND G. MIRANNE of Security Homestead Association will be taken on oral examination at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, on Thurs- day, January 6, 1977 at 9:30 a.m., and at any and all ad- journments thereof. The above named individual whose deposition is be- ing taken is hereby notified to appear for this deposi- tion and to bring with him: 1. Copies of all forms used for loan applications. 2. All documents supporting loans guaranteed or placed with FHA and/or VA assistance, assurance, or guarantee. 3. Documents showing total volume of VA/FHA premiums paid for or on behalf of loans carried 10. 93 on books of Security Homestead from October 31, 1971 to 10/31/75, by year. Settlement sheets for loan closings. Volume, total number and percentage of loans with title insurance. Volume, total number and percentage of loans with mortgage insurance; name and addresses of insurance companies. Any FNMA forms used or adapted or modified by Security Homestead. Documents showing name, address of all real estate brokers, realtors, mortgage brokers, to whom a commission was paid. Documents supporting volume, number of transactions, percentage of loans sold to a third party — FNMA, GNMA, insurance com- panies, etc. Any documents such as composite computer printouts which relate to number of loans, dollar volume, and breakdown by loan type. DATED: December 21, 1976. NELSON, NELSON & LOMBARD, LTD. A Professional Law Corpora- tion 94 ls| PATRICIA SAIK Patricia Saik John P. Nelson, Jr. (Certificate of Service Omitted) IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Omitted) Filed: Dec. 21, 1976 NOTICE OF DEPOSITION TO: (Names of Counsel Omitted) Notice is hereby given that pursuant to Rule 30(b) of the Federal Rules of Civil Procedure, the deposition of STAN WEBER of Stan Weber and Associates, Inc., Realtors, will be taken on oral examination at the law offices of Nelson, Nelson & Lombard, Ltd., 344 Camp Street, Suite 1100, New Orleans, Louisiana, on the 29th day of December, 1976, at 3:30 p.m., and at any and all adjournments thereof. The above. named individual whose deposition is be- ing taken is hereby notified to appear for this deposi- tion and to bring with him: 95 Copies of agreements with affiliates, for reloca- tion services, listing services for residential properties, fee splitting with out of state real estate brokers, agents, realtors, or other en- tities, including as “affiliates”, 21st Century, Inc., Gallery of Homes, etc. Documents supporting volume of transactions generated through relocation and/or affiliate services. Documents describing the services provided by Stan Weber to the public. Samples of documents listing the location, price, time period and other details of affiliated listings, and/or relocations, whether listed by your company or by another realestate entity. Listing agreements or types of listing agreements pertaining to-affiliate services. Documents, and source, including computer printouts for total number of transactions, the gross dollar volume of transactions, the type and size of transactions relating to all activities of your company. Any and all forms used by Stan Weber pertain- ing to buying, selling, financing and insuring residential real estate transactions. Copies of ad formats, advertising contracts, whether in newspapers, trade journals, magazines, or like pub':cations; and documents 96 97 supporting the cost of advertising, both in- IN THE UNITED STATES DISTRICT COURT terstate and intrastate, including financial FOR THE EASTERN DISTRICT OF LOUISIANA statements for the years 1971, 1972, 1973, 1974 and 1975. (Number and Title Omitted) 9. Copies of monthly telephone statements for 1975. Filed: Dec. 21, 1976 10. Documents showing name, address, gross dollar volume and number of transactions con- ducted with, by, or through any homestead, mutual savings bank, commercial bank, mortgage company, insurance company, and/or quasi or quasi-governmental agency. J MOTION FOR TIME TO EXTEND DISCOVERY NOW INTO COURT come plaintiffs, through undersigned counsel, and respectfully show the court as follows: 1. The cut-off date for discovery of information pertaining to subject matter jurisdiction is December 31, 1976. DATED: December 21, 1976. NELSON, NELSON & LOMBARD, LTD. 2. Several depositions have been scheduled before A Professional Law Corpora- December 31, 1976. However, pla’ tiffs have en- tion | countered difficulty in scheduling depositions for three or four additional persons before Is/ PATRICIA SAIK December 31, 1976. These depositions can be Patricia Saik scheduled in early January, 1977. John P. Nelson, Jr. 3 3. Plaintiffs request an additional two weeks, that is, through January 13, 1977, in order to com- (Certificate of Service Omitted) plete discovery. 4. Plaintiffs have been authorized to state that defendants do not oppose an extension of time through January 13, 1977. 98 Respectfully submitted, NELSON, NELSON & LOMBARD, LTD. A Professional Law Corporation ls) PATRICIA SAIK Patricia Saik John P. Nelson, Jr. DATE CF ENTRY: Dec. 23, 1976. ORDER Considering the foregoing, IT IS ORDERED that the cutoff date for discovery of matters pertaining to subject matter jurisdiction is hereby extended from December 31, 1976, to January 14, 1977. Signed at New Orleans, Louisiana, this 22d day of December, 1976. ls| EDW. J. BOYLE, SR. UNITED STATES DISTRICT JUDGE (Certificate of Service Omitted) 99 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA (Number and Title Ornitted) ~ Filed: Dec. 22, 1976 PLAINTIFFS’ FIRST SET OF INTERROGATORIES TO DEFENDANTS TO: (Names of Counsel Omitted) The plaintiffs request that each defendant, by an of- ficer or agent thereof, answer under oath, in accord- ance with Rule 33 of the Federal Rules of Civil Pro- cedure, the following interrogatories. Please take notice that a copy of such answers must be served upon the undersigned within thirty (30) days after the serv- ice of these interrogatories. Definitions 1. “Damage period” refers to the period from Oc- tober 31, 1971 through October 31, 1975. 2. “Residential real property” or “homes” refers to single residence, duplex, triplex and fourplex. 3. “Identify” means that wherever in these inter- rogatories you are asked to “identify” a docu- ment, please designate: 100 (a) Type of document, such as _ letter, memorandum, report, diary, expense ac- count, etc. (b) Information sufficient to enable plaintiffs to recognize the document such as its date, names and addresses of originators, title of the document, number of pages, etc. Form documents may be identified by the title of a form. (c) The present or last known location of the document with the name and address of the possessor. Interrogatories State the total number of completed sales for residential real property by defendant for each of the following years: (a) 1971 (b) 1972 (c) 1973 ° (d) 1974 (e) 1975 State the gross dollar amount of completed sales transactions by defendant for residential real property for each of the following years: (a) 1971 (b) 1972 (c) 1973 101 (d) 1974 (e) 1975 State for each of the following years, the number of completed real estate transactions in which you have participated as a real estate broker wherein the buyer financed the purchase with the Federal Housing Ad- ministration (FHA), Veterans Administration (VA) or other United States Government guaranteed financing: (a) 1971. (b) 1972 (c) 1973 (d) 1974 (e) 1975 What documents or other information did you refer to in answering the immediately pre- ceding interrogatory. State, for each of the following years, the number of completed real estate transactions in which you have participated as a broker wherein the buyer or seller was a resident of a state other than Louisiana: (a) 1971; (b) 1972; (c) 1973; (d) 1974; (e) 1975. At any time during the damage period, state whether defendant has ever advertised in any magazine, newspaper, trade journal, television 102 station, radio station or other media where. such advertisement is circulated to or received by people located outside the state of Louisiana. If the answer to the immediately preceding interrogatory is in the affirmative, for each advertisement state: (a) The name and address of the media utiliz- ed (b) The date the advertisement was placed (c) The exact text of the advertisement. If at any time since January 1, 1971, defen- dant operated, participated in or subscribed to a multiple listing service, national or inter- national relocation service, inter-city relo- cation service, or property location or sale serv- ice of any nature, identify: (a) The multiple listing service, national or international relocation service, inter-city relocation service, photo listing service or other such service. (b) The service you provide and the service which is provided to you. (c) The geographical area the service or serv- ices encompass. (d) Any and all conditions which must be satisfied in order to be able to use the serv- ice or services. (e) Any arrangement as to the brokerage fees 10. 103 or commissions charged for the sale of residential real property listed through the service. (f) Any arrangement as to division of the brokerage fees or commissions charged for the sale of real property iisted through the service. (g) The exact time period you operated the service, participated in it, or subscribed to it. (h) . The states or countries where your list- _ings are offered for sale through the serv- ice; and (i) The states or countries wherein you can offer listings to potential buyers through the service. Identify all documents you distributed, re- ceived or have access to in connection with any multiple listing service, national or inter- national relocation service, inter-city relocation service, photo listing service, or other such service, including but not limited to advertising materials for the service and listing catalogs. State the office address (including the city and state) of each and every office of defendant wherever located. 11. 12. 13. 14. 104 Describe the entire organizational structure of each defendant, indicating by way of example, whether defendant is an affiliate or subsidiary of any other corporation, partnership or sole proprietorship and a description of the business and type of activities of each parent, affiliate or subsidiary. State whether defendant will make available to plaintiffs without a motion to produce copies of all telephone bills showing all long distance calls (both intra and interstate) for every month from October 1971 to October 1975. If the answer is in the affirmative, please attach this information to your answers. State whether defendant will make available to plaintiffs without a motion to produce, any and all identification books, directory, or other system containing the names and addresses of persons or companies with which a defendant realty company does business or from which it might solicit whether directly or through speculation. If the answer to this interrogatory is in the affirmative, please attach these documents to your answers. State whether defendant will provide without a motion to produce copies of any brochures or other solicitations containing information about services which defendant provides and a list of the individuals and businesses to whom 15. 16. 17. 105 such brochures were mailed during the damage period. If the answer to this interrogatory is in the affirmative, please attach these documents to your answers. Give a complete description of the scope and operation of any placement or location or relocation services which defendant may pro- vide. State the names and addresses of all title in- surance companies which defendant has con- tacted during the damage period in conjunc- tion with any real estate-related transaction or with whom closings have been effected or who may have provided title insurance in conjunc- tion with such closings. State the names and addresses of all lending in- stitutions, public or private: (a) To which defendant has referred customers during the damage period. (b) Which defendant may have contacted to attempt to secure financing for its clients during the damage period. (c) Which have participated directly or in- directly during the damage period with any sale or purchase of residential real property in which defendant receivec a commission or brokerage fee. 7 106 The term “lending institutions” includes but are not limited to homesteads, mutual savings banks, commer- cial banks, insurance companies, credit unions, private individuals, Federal Housing Authority, mortgage bankers, Veterans Administration, Federal National Mortgage Association, General National Mortgage Association and the U.S. Department of Housing & Ur- ban Development. 18. State whether defendant will provide without a motion to produce copies of any cor- respondence between the defendant and (a) The Veterans Administration (b) [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_0093%3A02. Public record. Not legal advice.