Appendix — C. M. Uberman Enterprises, Inc. v. Historic Figures, Inc.

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Supreme Court, U.S.

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MAY 287 1984

L. STEVasS

CLERK

IN THE

Supreme Court of the Wuited States

OCTOBER TERM, 1983

NATIONAL SOUVENIR CENTER, INC., et al.,

Petitioners,

HISTORIC FIGURES, INC., et al.,

Respondents.

APPENDICES TO

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

DISTRICT OF COLUMBIA CIRCUIT

Of Counsel:

NELSON DECKELBAUM

DECKELBAUM, WOLPERT &

OGENS, CHTD.

1140 Connecticut Ave., N.W.

Suite 703

Washington, D.C. 20036

May 21, 1984

A. DOUGLAS MELAMED

JUANITA A. CROWLEY

WILMER, CUTLER & PICKERING

1666 K Street, N.W.

Washington, D.C. 20006

(202) 872-6000

JEROME S. WAGSHAL

JEROME S. WAGSHAL, P.C.

3256 N Street, N.W.

Washington, D.C. 20007

(202) 338-2121

Counsel for Petitioners

INDEX OF APPENDICES

Appendix A—Opinion and Order amending Opinion of

the United States Court of Appeals for

the District of Columbia Circuit in Na-

tional Souvenir Center, Inc. v. Historic

Figures, Inc., No. 82-2329 and consoli-

dated cases (February 10, 1984) -...........

Appendix B—Memorandum Order (May 19, 1981), Or-

der and Final Judgment and Memoran-

dum (September 3, 1982), and Order and

Memorandum (December 23, 1982) of the

United States District Court for the Dis-

trict of Columbia in Williamsburg Wax

Museum, Inc. v. Historic Figures, Inc.,

C.A. No. 77-0093 and consolidated cases..

Appendix C—Orders of Court of Appeals Denying Peti-

tion for Rehearing and Suggestion for

Rehearing En Banc (April 12, 1984) ......

Appendix D—Statutes Involved —.........02..2222222.2..2eeeeeee eee

Page

32a

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 82-2329

NATIONAL SOUVENIR CENTER, INC., et al.,~

Appellants

Vv.

HISTORIC FIGURES, INC., et al.,

No. 82-2330

WILLIAMSBURG WAX MUSEUM, INC.,

Appellant

Vv.

HISTORIC FIGURES, INC., et al.,

No. 82-2337

NATIONAL CIVIL WAR WAX MUSEUM,

Appellant

Vv.

HISTORIC FIGURES, INC., et al.

No. 83-1268

NATIONAL CIVIL WAR WAX MUSEUM,

Appellant

HISTORIC FIGURES, INC., et al.

No. 83-1269

NATIONAL SOUVENIR CENTER, INC., et al.,

Appellants

Vv.

HIsToRIC FIGURES, INC., et al.

No. 83-1270

WILLIAMSBURG WAX MUSEUM, INC.,

Appellant

Vv.

HISTORIC FiGuRES, INC., et al.

Appeals from the United States District Court

for the District of Columbia

(Civil Action Nos. 77-01243, 77-00093 & 77-00131)

Argued December 14, 1983

Decided February 10, 1984

Jerome S. Wagshal with whom Nelson Deckelbaum

was on the brief, for appellants.

David J. Cynamon with whom James C. McKay was

on the brief, for appellees.

Before: TAMM and WALD, Circuit Judges, and HEN-

LEY,” Senior Circuit Judge, United States

Court of Appeals for the Eighth Circuit.

Opinion for the Court filed by Circuit Judge WALD.

* Sitting by designation pursuant to 28 U.S.C. § 294(d).

WALD, Circuit Judge: These appeals spring from a

series of pre-trial rulings by the district court in three

consolidated antitrust cases involving wax museums; the

effect of these rulings is to deny all relief on the claims

filed. Plaintiff-appellants are commonly owned corpora-

tions which operate wax museums in Williamsburg, Vir-

ginia, Gatlinburg, Tennessee, and Gettysburg, Pennsy]l-

vania. Between 1962 and 1967, all three appellants

entered into agreements to purchase or lease display fig-

ures for their museums from appellees and to become

appellees’ “franchisees”. In 1977, the appellants filed

antitrust claims alleging that the appellees illegally tied

the franchise arrangements to the initial sale or lease of

the wax figures. Appellants National Souvenir Center,

Inc. and Historic Reviews, Inc., which jointly run the

Gatlinburg museum, also claimed that appellees unlaw-

fully exercised their monopoly power in the wax figure

market to require leasing rather than selling the figures.

Upon filing suit, all appellants stopped paying the fran-

chise fees and rents required by the allegedly illegal

agreements. Appellees then counterclaimed for recovery

of overdue payments and interest.

The district court made several rulings relevant to the

issues involved in this appeal. It first denied appellants’

motion that appellees’ attorneys be disqualified because

they had previously represented one plaintiff in matters

allegedly related to negotiation of one of the agreements

at issue here. It then denied appeliees’ motion for sum-

mary judgment based on their claim that the antitrust

charges were patently insubstantial, but granted them

summary judgment on their contract counterclaims,

awarding them the overdue franchise and lease fees, pre-

judgment interest on those fees, and ordering the ap-

pellants to pay all future franchise fees as they become

due. Finally, the court granted summary judgment for

the appellees on the ground that the antitrust claims

were barred by the statute of limitations. The appel-

lants appeal all adverse rulings including the remedial

order requiring them to pay overdue franchise fees with

interest and all future fees as they become due.

We affirm the dismissal of the appellants’ tying claims

on statute of limitations grounds. We find, however, that

the statute of limitations is not a proper ground for dis-

missing the Gatlinburg appellants’ monopoly leasing

claim. Although we do not wholly agree with the district

court’s analysis of the applicability of the appellants’

antitrust defenses to appellees’ counterclaims for overdue

franchise fees and lease payments, we agree with the

court that those defenses may not be raised, given the

facts of these cases. Therefore, we affirm the award of

past due franchise and lease payments. We do not find,

however, that the district court sufficiently justified its

order requiring appellants to pay future franchise fees

as they become due. The result is a remand for further

proceedings on the Gatlinburg monopoly leasing claim

and of the order to make future payments.

I. BACKGROUND

A. The Franchise Relationship

This lawsuit was spawned in January, 1957, when

Frank Dennis incorporated appellee Historic Figures, Inc.

(Historic) to operate a wax museum in Washington, D.C.

The display figures in the museum were provided by

appellee Lynch Display Corporation (Lynch), a company

formed by appellee Earl Dorfman in March, 1957, to

manufacture such figures. The figures were made of a

vinyl plastic material rather than the traditional beeswax

and, according to the appellants, “were considered a sub-

stantial improvement over the true wax figures.” Brief

for Appellants at 15. Lynch agreed to provide the figures

for the Washington museum and to assist in installing

them in appropriate historical settings. In return, His-

toric agreed to purchase figures exclusively from Lynch

and, for a five year period, to act as Lynch’s sales agent

to other wax museums.

Historic soon expanded its business to “franchising”

museums in different parts of the United States. The

first franchise was granted by Historic’s subsidiary Na-

tional Historical Museums, Inc. (NHM), in 1960, to

appellant-National Civil War Wax Museum (Gettys-

burg), which was owned primarily by Chaim Uberman.

According to Dennis’s affidavit accompanying appellees’

first motion for summary judgment, the agreement be-

tween NHM and Gettysburg obligated NHM to provide

Lynch figures at cost, and to “furnish, at Gettysburg’s

request, services ‘in connection with the establishment of

a museum by franchisee’ including historical research for

the figures and display scenes, advice on the cast of char-

acters, and story line, assistance in planning floor layouts

and advice on promotional material and operating proce-

dures.” Brief for Appellees at 9. The appellants contend,

however, that NHM also was obligated to “provide con-

tinuing franchisor services to its franchisees in the form

of assistance in the efficient operations of the museum”

throughout the twenty year franchise relationship. Brief

for Appellant at 21. In return, Gettysburg agreed to pay

NHM 5% of its annual gross receipts for twenty years,

beginning in April, 1962, when the museum opened.

In May, 1962, NHM entered a similar agreement with

appellant Historic Reviews, Inc. (Gatlinburg). NHM

agreed to provide essentially the same service as it pro-

vided Gettysburg in return for 5% of Gatlinburg’s gross

receipts for the nineteen year four month term of the

agreement. Unlike Gettysburg, Gatlinburg did not pur-

chase the display figures from Historic, but rather leased

them directly from Lynch for the term of the agreement

for an annual minimum rent plus 15% of gross annual

1 Historic entered subsequent agreements, after expiration of the

initial five year term, which obligated Lynch to provide figures for

museums which Historic had franchised.

receipts over $100,000. NHM also agreed not to grant

another wax museum franchise within 200 miles of Gat-

linburg during the term of the agreement.*

Uberman established a third franchised wax museum

in Williamsburg, Virginia. NHM and appellant Williams-

burg Wax Museum, Inc. (Williamsburg) entered a fran-

chise agreement on September 22, 1967. NHM obligated

itself to provide the same services as for Gettysburg and

Gatlinburg, and not to franchise another wax museum

within 100 miles of Williamsburg. In return, Williams-

burg agreed to pay NHM 5% of its gross receipts for

twenty years, and 214% of gross receipts thereafter.

The agreements are not typical franchises. See Brief

for Appellants at 20; Brief for Appellees at 12-13. As

the district court recognized :

[T]he characteristics that generally typify a fran-

chise are not present here: there is no operation

under a common name or designation, no cooperative

advertising, no periodic inspections, and no establish-

ment of common standards or business practice.

Williamsburg Wax Museum, Inc. v. Historic Figures,

Inc., Civ. No. 77-0098, slip op. at 3 n.5 (May 19, 1981)

(Memorandum Order granting defendants’ motion for

summary judgment on their counterclaims, but denying

summary judgment for defendants on plaintiffs’ anti-

trust claims). Indeed, precisely what NHM provided in

return for the “franchise fee” is a critical issue in the

case. Appellees characterize the franchise agreements as

intended to get the museums off the ground by pro-

viding experienced assistance “in connection with the

establishment of a wax museum” and by offering

Dorfman’s consultant services to the franchisees for

this purpose only for the period prior to and during

2 At the time the franchise agreement was executed, Gatlinburg

was owned by a Tennessee entrepreneur, Shelby Boyd. However,

in 1964, he sold it to Uberman’s company

the opening of each museum. ... Therefore, .. .

of the agreements “to stand by” to provide additional

services as requested and paid for by the franchisees

(and with respect to Gatlinburg and Williamsburg,

also were under a continuing obligation not to estab-

lish competing wax museums in specified geographical

areas) but the franchisees were under no obligation

either to request or pay for such additional services.

Brief for Appellees at 13. The appellants’ interpreta-

tion of the agreements, on the other hand, is quite differ-

ent. They claim that “actual services, not merely a

standby commitment, were due from the defendants for

the franchise fee payments, but that the defendants gen-

erally failed to honor this obligation.” Brief for Appel-

lants at 20. The record, however, shows no particular

instance where NHM provided additional services, be-

yond start-up services, except for an additional charge.

B. The District Court Rulings

The district court first considered appellants’ motion

to disqualify defendants’ counsel, Covington & Burling

(C&B), on the ground that it has previously counselled

one appellee, Gettysburg, regarding the franchise agree-

ment involved in this suit. Williamsburg, slip op. at 4

(Nov. 26, 1980) (Memorandum). The district court’s in-

quiry focused on whether “there is a substantial relation-

ship between the present litigation [involving the fran-

chise agreements] and the matters on which C&B pre-

viously provided advice to Gettysburg.” Jd. at 4. After

examining the record before it, the court denied appel-

lants’ motion to disqualify C&B on the ground that “there

is not the slightest evidence or even suggestion in all

these materials that C&B advised Gettysburg with re-

spect to the franchise agreement.” Jd. at 7.

The district court next turned down appellees’ motion

for summary judgment on appellants’ antitrust claims.

It noted that the elements of a per se tying violation

under Section 1 of the Sherman Act, 15 U.S.C. $1, are

(1) that the challenged arrangement is in fact a

tying arrangement, (2) that the seller has sufficient

economic power with respect to the tying product,

and (3) that a “not insubstantial” amount of inter-

state commerce in the tied product is affected.

Williamsburg, slip op. at 5-6 (May 19, 1981) (Memo-

randum Order). It found there were genuine issues of

material fact on all three elements. First, it rejected

appellees’ “attempts to analogize these cases to traditional

franchise cases” involving a single product or products

that go “hand-in-hand with [each] other,” id. at 7 n.10,

observing that whether the “franchise” and figures were

so related that they constituted a single product was a

genuinely disputed issue of fact. Second, it was not able

to find that the Lynch display figures were “not suffi-

ciently unique” or that “satisfactory substitutes were

available,” and that therefore appellees did not have a

monopoly in the tying product market. Finally, it could

not conclude that the franchise fees NHM collects affected

only an “insubstantial” amount of interstate commerce.

On the basis of such factual disputes, the district. court

declined to rule that appellants’ per se tying claim was

invalid as a matter of law.

The district court, however, did grant summary judg-

ment for appellees on their counterclaims. It initially

interpreted Kelly v. Kosuga, 358 U.S. 516 (1959), and

Mullins v. Kaiser Steel Corp., 642 F.2d 1302 (D.C. Cir.

1980), rev’d, 455 U.S. 72 (1982), to preclude a defense

to a contract action in a case such as this based on the

illegality of the contract under the antitrust laws, because

the illegality defense was limited to situations where “en-

forcement . . . would make the court a party to the

illegality.” Williamsburg, slip op. at 10 (May 19, 1981)

(Memorandum Order). After the Supreme Court re-

versed this court’s ruling in Kaiser, 455 U.S. 72, it re-

considered, but concluded, once again, that as long as “‘the

promise being sued on is not itself illegal under the anti-

trust laws,” Kaiser did not require recognition of the

defense. Williamsburg, slip op. at 2 (Sept. 3, 1982)

(Memorandum). The promise to pay being sued on in

this case was not itself illegal, the district court said,

since any antitrust damages in this case “would not neces-

sarily include a recovery of the fees paid by plaintiff

under the contract.” Jd. at 3. It thus refused to vacate

the grant of summary judgment for appellees. Subse-

quently, the district court ordered that appellants pay all

overdue charges due under the agreement, plus pre-

judgment interest on them, Williamsburg (Nov. 4, 1982)

(Order adopting plans for stay of final judgment en-

tered September 3, 1982), as well as all future charges

as they become due.

The district court finally dismissed appellants’ antitrust

claims-in-chief as barred by the Clayton Act’s four year

statute of limitation, 15 U.S.C. §15b. See Williamsburg,

554 F. Supp. 182 (D.D.C. 1982) (dismissing tying

claims) ; National Souvenir Center, Inc. v. Historic Fig-

ures, Inc., Civ. No. 77-1243 (Jan. 31, 1983) (Memoran-

dum dismissing suit based on unlawful use of monopoly

power). It reasoned that since the agreements were exe-

cuted well over four years before appellants filed suit,

they were barred unless appellees committed new “overt

acts” within the limitations period which caused antitrust

injury. Finding none, the court dismissed the suits.

Appellants appeal from all the adverse rulings of the

district court. In addition, they also ask us, in remand-

ing, to reverse the district court’s consolidation of these

three cases, claiming that such consolidation may create

confusion for a jury. We turn now to consider the merits

of these appeals.

10a

Il. THE STATUTE OF LIMITATIONS

Appellants brought their antitrust claims under the

treble damage provision of the Clayton Act, 15 U.S.C.

$15. Section 4B of that Act provides:

Any action to enforce any cause of action under sec-

tions 15 vr 15a of this title shall be forever barred

unless commenced within four years after the cause

of action accrued.

15 U.S.C. §15b. The primary question in this appeal is

when the appellants’ cause of action “accrued.”

We assume for purposes of this issue, as the district

court did, that appellants’ complaints state a valid cause

of action. It follows, then, that appellants could have

raised their antitrust claim as soon as the allegedly un-

lawful agreements were executed and they suffered harm

therefrom. But this does not mean their cause of action

necessarily “accrued” only at that time. In Hanover

Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481,

502 n.15 (1968), the Supreme Court held that although

an unlawful lease-only policy first affected the plaintiff

in 1912, a suit instituted in 1955 was not barred by

Pennsylvania’s six year statute of limitations, since the

lease-only policy was “conduct which constituted a con-

tinuing violation of the Sherman Act .. . [and] inflicted

continuing and accumulating harm on Hanover.” Id. The

“continuing violation” exception to the rule that the ac-

tion accrues at the time the initial violation first injures

the plaintiff was further delineated by the Court in

Zenith Radio Corp. v. Hazeltine, Inc., 401 U.S. 321, which

stated:

[iJn the context of a conspiracy to violate the anti-

trust laws, . . . each time a plaintiff is injured by

an act of the defendants a cause of action accrues to

him to recover the damages caused by that act and

that, as to those damages, the statute of limitations

runs from the commission of the act.

lla

Id. at 338. Under Zenith and Hanover Shoe, then, any

act within the limitation period that effectuates an anti-

trust injury pursuant to the conspiracy [or in this case

the agreement] gives rise to an action for damages. For

their action to survive, plaintiff-appellants had to show

an “overt act” pursuant to the original tying arrange-

ment by the appellees within the limitation period which

caused them an antitrust injury. See Kaiser Aluminum

& Chemical Sales, Inc. v. Avondale Shipyards, Inc., 677

F.2d 1045, 1055-56 (5th Cir. 1982), cert. denied, 103

S.Ct. 729 (1983); Electroglas, Inc. v. Dynatex Corp.,

497 F. Supp. 97, 105 (N.D. Cal. 1980).

In the case of a genuine tying arrangement, the “overt

act” requirement may be satisfied merely by the parties

continuing to maintain contractual relationships that di-

rectly affect competition in the tied product market. See,

e.g., Twin City Sportservice, Inc. v. Charles O. Finley

& Co., 512 F.2d 1264, 1270 (9th Cir. 1975) ; Electroglas,

497 F. Supp. at 105; Aamco Automatic Transmissions,

Inc. Vv. Tayloe, 407 F. Supp. 480 (E.D. Pa. 1976); Ma-

terial Handling Industries, Inc. v. Eaton Corp., 391 F.

Supp. 977, 980 (E.D. Va. 1975). This is because the

evil of a tying arrangement is that it allows a seller who

has monopoly power in the tying product market to use

it as leverage to gain a share of the tied product mar-

ket. See Fortner Enterprises, Inc. v. United States Steel

Corp., 394 U.S. 495, 498 (1969); Northern Pacific Rail

Co. v. United States, 356 U.S. 1, 5-6 (1958). In so do-

ing, the monopolist forecloses the share of the secondary

market involved in the tying arrangement from competi-

tors, and in addition is able to charge more for the tied

product than the purchaser would have paid absent this

leverage. Tying arrangeinents, even if not strictly en-

forced, “are binding obligations held over the heads of

vendees which deny defendants’ competitors access to the

fenced-off market on the same terms as the defendant.”

Northern Pacific, 356 U.S. at 12. They effectively trans-

fer the seller’s monopoly leverage in the tying market

12a

to contractual obligations in the tied market. The criti-

cal issue thus becomes whether the agreements, or ap-

pellees’ actions pursuant thereto, obligated appellants to

deal only with appellees or otherwise discouraged appel-

lants from turning to other suppliers in the tied product

market within the statute of limitations period.

To make this determination, we have first to identify

the “tied product”. At oral argument appellees’ counsel

characterized it as “the franchise.” As best we can

fathom, he meant the long-term association with NHM

along with the start-up advice and stand-by availability

that was sold to appellants at the time the agreements

were executed. The appellants, on the other hand, specifi-

cally alleged that the tie-in was of promotion, advertising

and other services related to museum operations which

appellees were obligated to provide appellants in payment

for their franchise fees. If the appellees are correct, then

performance of the agreement, even if it involved an

initial tie-in, would have no anticompetitive effect on the

market thereafter and so would not survive the statute

of limitations bar.

The district court, in granting summary judgment for

appellees, found in favor of their contention that the

agreements did not call for the appellees to provide pro-

motional, advertising or other operation-related services

during the limitation period in return for the franchise

fees. The district court, however, apparently did not re-

view the record to ensure that this was not a disputed

issue. Instead it asserted that, “[i]t is the law of these

cases that the parties intended any post start-up services

to be paid for separately, over and above the ongoing

franchise fees” relying on its statement in an earlier

Memorandum Order of May 19, 1981, that

fulnder the “franchise” agreements, defendants

were obligated to provide various start-up services

or products, and they agreed to “make themselves

available” to provide further services at additional

13a

cost, in exchange for a fee of five percent of the

franchisee’s annual gross receipts.

Williamsburg (Memorandum Order granting summary

judgment in part and denying it in part) .*

In the proceedings leading to the order of May 19,

1981, however, the parties did not litigate whether the

tied product was start-up services and a standby com-

mitment, or provision of promotions and advertising

without further costs throughout the term of the agree-

ment. For the appellants to survive summary judgment

on the viability of their antitrust claims, they had to

show only that there were factual issues about whether

there was a separate product that was tied to the pur-

chase of the museum figures, and whether appellees had

a monopoly on those figures. Because the factual issue of

whether the tied product was to be provided throughout

the term of the agreement as opposed to at the beginning

only was immaterial to the court’s disposition in its

May 19th order, the law of the case doctrine does not

apply. See Russell v. Commissioner of Internal Revenue,

678 F.2d 782, 784-85 (9th Cir. 1982) (dictum in prior

decision “is not part of the law of the case”). However,

we affirm the district court on a different basis. We con-

clude that the record before the court on the summary

judgment motion does not support the appellants’ conten-

tion that there is a genuine issue of fact regarding the

appellees’ obligations to provide continuing services for

the basic franchise fee throughout the term of the agree-

3 Of course, this court is not precluded from considering an issue

that the lower court found to be the law of the case. See 18 Federal

Practice and Procedure, Wright, Miller & Cooper § 4478 (1981).

‘The rule of the law of the case is a rule of practice, based upon

sound policy that when an issue is once litigated and decided, that

should be the end of the matter.” United States v. United States

Smelting Refining and Mining Co., 339 U.S. 186, 198-99 (1950).

14a

ments.* Hence, the district court’s critical assumption

that the agreements did not so provide was valid.

Turning to the record on the scope of the agreements,

we look first and foremost at the terms of the franchise

agreements themselves. Appellants contend that each

agreement “on its face” obligates the appellees to pro-

vide continuing services for the basic franchise fee. See

Reply Brief for Appellants at 8. We do not agree. The

Gettysburg agreement, which is typical of all three agree-

ments, provides:

(NHM] will advise FRANCHISEE regarding the

scenes and figures to be displayed in FRAN-

CHISEE’s museum, the selection of a museum site,

the layout designs, and other similar problems which

may arise in connection with the establishment of

a museum by FRANCHISEE. [NHM] will also

advise FRANCHISEE regarding administrative pro-

cedures for the efficient operation of FRAN-

CHISEE’s museum, including accounting procedures,

turnstile and ticket operations, building maintenance,

and promotion and advertising techniques. In con-

nection with such advice, [NHM] will make avail-

able to FRANCHISEE the services of a qualified in-

dividual for two consultation periods, not to exceed

one week each in duration at FRANCHISEF’s re-

quest during the period ending 30th day of SEP-

TEMBER, 1962....

4 The appellants explicitly stated below, at the time they argued

against the appellees’ motion for summary judgment on the statute

of limitations, that this factual issue was in dispute. See Volume 3

of the Supplemental Record Excerpts [henceforth cited as SRE}.

But mere assertions of facts in pleadings and affidavits, when un-

supported by any evidence, are not necessarily sufficient to preclude

summary judgment. See Exxon Corp. v. Federal Trade Commission,

663 F.2d 120, 128 (D.C. Cir. 1980) (purely speculative issues of fact

need not be preserved for trial); Pignous S.A. de Mecanique de

Precision v. Polaroid Corp., 657 F.2d 482 (1st Cir. 1981) (“factual

dispute is . . . genuine if manifested by ‘substantial’ evidence going

beyond allegations of the complaint’).

15a

In consideration of the unique figures and the

services to be furnished by [NHM], FRANCHISEE

agrees to pay to [NHM] for a period of Twenty

(20) years following the date of the opening to the

public of FRANCHISEE’s museum an amount equal

to Five per cent (5%) of the gross admission income

received by FRANCHISEE from the operation of its

museum.

This key passage from the agreement indicates to us that

NHM did not obligate itself to provide continuing serv-

ices over the years as the franchise agent. It provides

for advice relating to the “establishment of a museum”

and “administrative procedures for the efficient opera-

tion” including advice on “promotion and advertising

techniques.” (Emphasis supplied). It also sets out the

extent of the services to be rendered “in connection with

such advice,” i.e., it was not to exceed two weeks of con-

sultation during the period ending September 30, 1962.

Although there is no set term for the franchise itself, the

agreement requires Gettysburg to pay a fee for twenty

years. It seems clear that most of this fee is an extended

payment for the Lynch figures. Only a tortuously strained

interpretation of this language supports appellants’ con-

tentions that NHM was obligated to provide, as well, an

undefined and openended amount of promotion, advertis-

ing and other musgum services throughout the twenty

year period without further pay.

Appellants petnt, additionally, to the affidavit of Saul

Eric Uberman, to demonstrate appellees’ continuing obli-

gation to provide services. But Saul Uberman, the son of

Chaim Uberman and vice president of C.M. Elberman

Enterprises, Inc., the corporate successor of the appel-

lants, was not involved in negotiating any of these agree-

ments. Beyond the assertion that “it was never the

understanding of either Frank Dennis nor of Earl Dorf-

man that the franchisor’s obligations under the three

franchise agreements were limited to merely a stand-by

l6a

commitment,” * 3 SRE at 690, his affidavit suggests that

certain meetings and telephone contacts between appel-

lants and appellees that cannot be tied to additional fee

payments might be evidence of provision of additional

services under the agreements.* Id. at 610. This ob-

viously is pure speculation. The affidavit concludes by

noting that Saul Uberman had requested services from

Frank Dennis and Earl Dorfman on several occasions,

but that they did not comply with these requests. Appel-

lants place great significance on the fact that neither

Dennis nor Dorfman ever stated in reply to these re

quests that the services would not be provided because

they had to be paid for separately. See id. at 611. This

second negative inference, however, is as speculative as

the first.

Reviewing the record as a whole, we find most striking

the appellants’ inability to point to a single concrete

instance before suit was filed when appellees either pro-

vided services within the limitations period for no addi-

tional fee, or appellants complained that the lack of such

free services breached the agreements. In the end, we

simply find these bits and pieces and the reasonable in-

ferences drawn from them, even when viewed in the light

most favorable to appellants, insufficient to raise a gen-

uine issue of material fact as to whether the agreements

obligated the appellees to provide advertising and promo-

5 This is the type of assertion without supporting justification

that we must consign to the category of conclusory statements that

will not defeat a grant of summary judgment. See, e.g., Aladdin

Oil Co. v. Texaco, Inc., 603 F.2d 1107, 1117 (5th Cir. 1979) ; see also

Habib v. Raytheon Cc., 616 F.2d 1204, 1211 (D.C. Cir. 1980) (hold-

ing such statements created genuine issue of fact only because mat-

ters involved were by nature “shrouded in secrecy’).

6 Appellants point to no evidence that these contacts in fact in-

volved services provided without fee. In contrast, appellees cite

several specific instances where services were provided for addi-

tional charges. See Brief for Appellees at 12 & n.1.

17a

tional services on a continual basis over the life of the

franchise without additional compensation.

After concluding that the tied product was only initial

Start-up services, the district court inquired into the

agreement’s ongoing anticompetitive effects and deter-

mined that the appellants suffered “only pecuniary and

not antitrust harm within the limitations period.” Wil-

liamsburg, 554 F. Supp. at 184. We agree with the dis-

trict court that mere receipt of payments under an

agreement that at some time had anticompetitive effects

on the tied product market but no longer has such effects,

does not cause “antitrust harm,” and does not constitute

a continuing antitrust violation. As the district court

pointed out,

[i]f the law were otherwise, the statute of limita-

tions would have little force whenever a contract

allegedly executed in violation of the antitrust laws

provided for long term payments: there would be no

repose until four years after the last installment

payment.

Williamsburg, 554 F. Supp. at 184. We also agree with

the district court that appellees’ commitment to stand by

and provide services at fair market value would not seem

in any way to discourage the appellants from purchasing

the allegedly tied services from other sellers of compara-

ble services, and so would not inhibit competition in the

tied market. Because no “overt act” in the four years

preceding appellants’ suit had any effect on the market,

we affirm the district court’s grant of summary judgment

as to the tying claims on statute of limitation grounds.

We do not agree, however, with the district court’s

subsequent dismissal on statute of limitations grounds of

Gatlinburg’s claim that it was forced to lease the Lynch

figures as part of appellees’ conspiracy to monopolize the

wax museum display figure market. See National Souve-

nir Center, Inc. (Jan. 31, 1983) (Memorandum granting

18a

appellees summary judgment on monopolization claims

based on Gatlinburg lease on statute of limitations

grounds). Appellants alleged that the Gatlinburg lease,

like the leases found illegal in Hanover Shoe, 392 U.S. at

486 n.3, perpetuated appellees’ monopoly power in the

wax figure market. See Brief for Appellants at 54.

They say that the required lease discouraged them from

exercising “independent judgment” about whether to dis-

pose of the Lynch figures and replace them with competi-

tors’ products at any time in the future and so reinforced

appellants long-term monopoly position. See Brief for

Appellants at 53-54; cf. Hanover Shoe 392 U.S. at 507

(appendix to opinion of the court). We admit to extreme

skepticism about the substantive validity of this monopoly

lease claim based on maintenance of a single lease by an

alleged monopolist.’ We are aware of no case recogniz-

ing such a claim. Appellees’ sale of the Lynch figures to

other wax museum franchisees seriously undercuts appel-

lants’ arguments that appellees relied on the lease as a

mechanism to discourage replacement of the figures with

those of competitors during the lease term, or that leasing

rather than selling significantly affected the market for

figures.* Nonetheless, we are not asked here to review the

7 As we and the district court read Gatlinburg’s monopolization

claim, it does not hinge on restrictions attached to the lease but on

the mere fact that the figures were leased rather than sold. See

National Souvenir Center, slip op. at 4 (Jan. 31, 1983) (Memo-

randum). Even if appellants do contend that the lease contains un-

lawful restrictive conditions, we suspect that they will have difficulty

demonstrating that the conditions in the single lease had either

sufficient anticompetitive effects or sufficiently evidenced appellees’

alleged anticompetitive motivation to violate the “rule of reason”

applicable to such a claim. See Genovese Drug Stores, Inc. v.

Becrose Associates, 563 F. Supp. 1299, 1805 (D. Conn. 1983); Net

Realty Holding Trust v. Franconia Properties, Inc., 544 F. Supp. 759

(E.D. Va. 1982).

8 Gatlinburg points out that the sale of figures by appellees to

other museums was accompanied by resale restrictions. This bol-

sters its argument that the lease was imposed as a device to preclude

19a

substantive validity of Gatlinburg’s claim, only the pro-

priety of its dismissal on statute of limitations grounds.

Our test for determining when an antitrust cause of

action stops “accruing” requires us to look at when the

challenged contract—in this case the lease—ceases to ob-

ligate conduct that has anticompetitive effects. Requir-

ing appellants to continue paying rent for the Lynch fig-

ures meant they could not resell the figures or replace

them throughout the duration of the lease without severe

economic losses; it had as much effect in the market for

the figures in 1977 as it did in 1962. Because of this

continuing allegedly “anticompetitive” effect of the lease,

the statute of limitations is not a proper ground for

dismissing the monopolization claims stemming there-

from. See Hanover Shoe, Inc. v. United Shoe Machinery

Corp., 245 F. Supp. 258, 296 (M.D. Pa. 1965) (“recovery

for payments made [within the limitations period] pur-

suant to leases executed prior to that [period] is not

barred by the . . . statute of limitations”), vacated and

remanded on other grounds, 377 F.2d 776 (3d Cir. 1967),

a secondhand market in Lynch figures. This argument, relying on

resale restrictions, however, was first raised on appeal. See, e.g.,

National Souvenir Center, Complaint § 22 (filed July 15, 1977)

(alleging only that compelled lease led to appellants paying “ex-

horbitant and unconscionable” rate); id., Plaintiffs’ Opposition to

Defendants’ Motion for Summary Judgment at 31-32 (filed Jan. 19,

1981) (no mention of resale of figures in argument on leases) ; id.,

Plaintiffs’ Memorandum in Opposition to Defendants’ Motion for

Summary Judgment With Respect to the Gatlinburg Lease Agree-

ment (particularly discussing anticompetitive effect of lease as al-

lowing appellees to monopolize market for repair of figures; never

mentioning secondhand market or resale restrictions in other agree-

ments). We leave it to the district court, which is more familiar

with the history of the proceedings in this case and the evolution of

Gatlinburg’s exact contentions, to decide if this claim is sufficiently

related to Gatlinburg’s original complaint—that the lease precluded

“independent judgment” whether to replace the Lynch figures with

others—so that Gatlinburg may raise the claim on remand at this

late date.

20a

aff'd in relevant part, rev’d in part and remanded, 392

U.S. 481 (1968).

III. ANTITRUST DEFENSES TO CONTRACT COUNTERCLAIMS

Appellants also assail the district court’s grant of sum-

mary judgment on the appellees’ claims for overdue fran-

chise and lease payments. They claim that the judg-

ment requires a federal court to enforce an illegal con-

tract and that result is contrary to the rule governing

antitrust defenses recently laid down in Kaiser Steel

Corp. v. Mullins, 455 U.S. 72 (1982). The district court

read Mullins as allowing antitrust defenses to contract

suits only where “the promise being sued on is itself

illegal” under the antitrust laws. It characterized the

promise appellees sued on as one “for monies for goods

or services furnished to the plaintiff over a period of

years.” Williamsburg, slip op. at 2 (Sept. 3, 1982)

(Memorandum). It apparently concluded that this prom-

ise was legal because the “damages [Gatlinburg asked

for in its antitrust claim] would not necessarily include

a recovery of the fees paid and to be paid by [Gatin-

burg] under the contract.” Jd. Although our reasoning

differs from that of the district court, we agree that

under Mullins appellants can not raise their antitrust

defenses.

To understand Mullins, we look first at limitations

that courts had imposed previously on the applicability

of antitrust defenses to contract suits. The leading pre-

Mullins case is Kelly v. Kosuga, 358 U.S. 516 (1959),

which involved a suit by a seller of onions against a

buyer for failure to pay. As a defense, the buyer, who,

like the seller, was an onion supplier, alleged that he

had been coerced to buy the onions by the seller’s threats

to dump a large quantity on the market, thereby de

pressing prices. The contract-suit defendant agreed to

buy 50 cars of onions, and both plaintiff and defendant

agreed not to deliver any onions on the market for the

2la

remainder of that trading season, thereby artificially

decreasing demand and inflating futures prices. The

Court rejected the defendant’s argument that, because

he was coerced into buying the onions by a threat of

unlawful conduct, the contract was unenforceable. In

doing so, it noted that “the plea of illegality based on

violation of the Sherman Act has not met with much

favor in this Court.” Jd. at 518. It then stated the

following rule for deciding when to enforce illegal

contracts:

Past the point where the judgment of the Court

would itself be enforcing the precise conduct made

unlawful by the [Sherman] Act, the courts are to be

guided by the overriding general policy .. . “of

preventing people from getting other people’s prop-

erty for nothing when they purport to be buying it.”

Id. at 520-21 (quoting Continental Wall Paper Co. V.

Louis Voight & Sons, Co., 212 U.S. 227, 271 (1909)

(Holmes, J., dissenting) ).

Kosuga was generally viewed as permitting antitrust

defenses in only a very narrow class of contract suits,

courts being understandably hesitant to interpose com-

plex antitrust issues in a simple suit for breach of con-

tract. See Mullins, 642 F.2d at 1311 (D.C. Cir. 1981),

Viacom International, Inc. v. Tandem Productions, Inc.,

526 F.2d 593 (2d Cir. 1975). This court, in particular,

read Kosuga to limit antitrust defenses to situations

where the requested enforcement was of agreements not

to compete or other direct market restrictions, that made

“the court ... a party to an anticompetitive scheme.”

Mullins, 642 F.2d at 1310 (quoting Kosuga, 358 U.S.

at 520); see also id. at 1311 n.9.

This court’s decision in Mullins, however, was re-

versed by the Supreme Court. See 455 U.S. at 78-79. In

Mullins, the defendant, a coal producer, agreed to make

contributions to United Mine Worker health and retire-

22a

ment funds based in part on the quantity of coal it pur-

chased from non-union producers. The defendant failed

to report such purchases and to make contributions based

on them. After the contract expired, the union sued to

collect the owed contributions. Clearly, enforcement of

the promise to contribute to the welfare fund would not

have directly impeded competition at that point in time.

See id. at 81 n.6. Nonetheless, the Supreme Court allowed

the asserted antitrust defense, stating:

If [defendant] Kaiser’s undertaking is illegal under

the antitrust . . . laws, it is because of the financial

burden which the agreement attached to purchases of

coal from non-UMW producers, even though they

may have contributed to other employee welfare

funds. It is plain enough that to order Kaiser to pay

would command conduct that assertedly renders the

promise an illegal undertaking under the federal

statutes.

Id. at 79.

In so holding, however, the Court cited with favor

language in Kosuga that lower courts had relied on to

strictly limit applicability of antitrust defenses. See 455

U.S. at 80 (“plea of illegality based on violation of the

Sherman Act has not met with much favor”) (quoting

Kosuga, 358 U.S. at 518). In addition, Mullins accepted

the Kosuga rationale that an antitrust defense to a con-

tract suit may be raised only where enforcement “would

make the courts a party to the carrying out of one of the

very restraints forbidden by the Sherman Act.” Jd. at 81

(quoting Kosuga, 358 U.S. at 520). In Mullins, the

promise to contribute to the health and retirement funds

in proportion to defendant’s purchases of non-union coal

was a means by which the plaintiff “enforced” restraints

on purchases of non-union coal by linking contributions to

the purchase of non-union coal. This promise on its face

embraced the very restraint of trade that the defendant

23a

alleged violated the Sherman Act. Had the Court assisted

the union in collecting such contributions, it would have

effectively become a party to the allegedly illegal scheme

to discourage non-union coal purchases. Thus, in permit-

ting the defendant to raise its antitrust defense in Mul-

lins, the Court opened the window only a notch to anti-

trust defenses, i.e., it refused to enforce a promise to pay

that was itself a mechanism to police anticompetitive

conduct.

Unlike the “illegal promise” in Mullins, the promises to

pay franchise fees in this case do not appear on their

face to be primarily means to enforce the allegedly illegal

tie-ins between the wax figures and start-up services.

They appear rather to be a consideration for goods and

services, to be paid for on an installment basis, 7.¢e., a

routine exchange which Mullins was careful to distinguish

from the penalty-like agreement it refused to enforce.

See Mullins, 455 U.S. at 80 (antitrust defense disfavored

in action to recover agreed price for goods sold). This is

not a case where the appellants turned to an alternative

supplier of start-up services and now object to paying a

“penalty” for doing so.*° To transform the contracts here

into illegal tie-ins would require complex proof of monop-

oly power in the tying market and leverage of that power

in the tied market. Even then, their vice would extend

only to the amount that the agreed prices exceeded the

fair value of the goods and services received and con-

sumed—the portion of the prices that could be traced to

the illegal practice. The complexity of proof and specula-

tive nature of appellants’ defenses seem to us to place

® Enforcement of the bulk of the payments as they became due

would not have affected the tied market, since the obligations to

make most payments arose well after the allegedly tied start-up

services had been supplied and consumed; this is in contrast to

Mullins where the obligation to pay arose at the time of purchase

of non-union coal, and enforcement at that time would have imposed

an immediate penalty for breaching the union’s illegal restraint of

trade.

24a

them outside of the Mullins exception and clearly within

the ambit of disfavor for such defenses articulated in

Kosuga. And even if there might be grounds for such a

defense in other cases, we reject it here, where it was

first raised ten years after the figures and the “tied”

start-up services had been received and consumed without

objection by the buyer.*° We therefore hold in the circum-

stances of this case that the obligation to make franchise

payments persists and the defense that the original agree-

ment included a tainted tie-in sale may not be raised.

The remote danger, in a case such as this, that the court

will be a party to enforcing an illegal restraint, seems

far outweighed by the probability that allowing the de-

fense would let the buyer escape from its side of a bar-

gain long after it had secured exactly what it had

bargained for, as well as involve the courts in a prolonged

controversy over whether an illegal tie-in existed due to

the seller’s market power and how that tie-in affected the

agreed price for goods and services.

We also hold that appellants cannot raise any illegality

that may attach to the Gatlinburg lease as a defense to

appellees’ counterclaim for lease payments. Appellants

nowhere attack their obligation to pay rent, standing

alone, as illegal under the Sherman Act. Such a rationale

would lead to the absurd result that all leases violate the

antitrust laws. Instead, appellants allege that they were

coerced to lease the figures as part of a scheme by ap-

10 Our construction of Mullins does not necessarily preclude anti-

trust defenses to all tie-in contracts. Where the tying arrangement

calls for payments for ongoing receipt of the tied product, or pay-

ments in proportion to the quantity of tied product purchased from

competitors, a court might find the payments to be a “mechanism”

by which the contract-suit plaintiff “enforces” the tie-in, and allow

an antitrust defense to be raised under Mullins. Cf. Avondale, 677

F.2d at 1058 (under Mullins, antitrust defense precluded because

plaintiff “did not seek enforcement of the actual tie-in”). This case,

however, involves neither an ongoing provision of the tied product

nor payments for purchases from competitors.

a ee Penal a ll lar ate Reagan Nn li i MS.

25a

pellees to perpetuate their monopoly over Lynch figures.

But this allegation raises factual controversies, perhaps

relevant to appellants’ contentions that the lease was part

of a bigger scheme to monopolize the wax museum figure

market, that are entirely unrelated to the contract claim

before us. It is precisely this type of antitrust defense

that Kosuga clearly held, and Mullins affirmed, to be

inappropriate in a simple suit for the purchase price of

delivered goods. See Mullins, 455 U.S. at 80, Kosuga, 358

U.S. at 431. In accord with these cases and the district

court’s decision, we hold that Gatlinburg may not raise

the alleged antitrust illegality of its lease of Lynch

figures as a defense to appellees’ suit for rent.

IV. RELIEF AWARDED FOR APPELLEES’ COUNTERCLAIMS

We next consider appellants’ attack on the award of

prejudgment interest and the order requiring them to

make future franchise and lease payments as they come

due. Although appellants’ obligations to pay franchise

fees and rent under the Gettysburg and Gatlinburg agree-

ments ended in 1982, Williamsburg’s obligation to pay

242% of gross receipts runs in perpetuity.

We find no merit to appellants’ position on the issue

of prejudgment interest. The district court properly fol-

lowed the District of Columbia’s statutory prescription,

which states:

In an action . . . to recover a liquidated debt on

which interest is payable by contract or by law or

usage, the judgment for the plaintiff shall include

interest on the principal debt from the time when it

was due and payable, at the rate fixed by the con-

tract, if any, until paid.”

D.C. Code § 15-108 (1981).

11 Appellants’ suggestion that Giant Food, Inc. v. Jack I. Bender

& Sons, 399 A.2d 1293 (D.C. App. 1974), precludes prejudgment

interest whenever the claim is subject to a counterclaim borders on

26a

We find more convincing appellants’ contentions that

the district court did not properly justify granting in-

junctive relief requiring future payment of fees as they

become due. The district court apparently did not con-

sider the contract to have been terminated or repudiated.”

By requiring future payments, it essentially ordered ap-

pellants to continue performing their contractual obliga-

tions. The court thus denied the appellants any oppor-

tunity to repudiate the contract and thereby obligate

appellees to mitigate damages flowing from any future

breach. See Restatement (Second) of Contracts § 350.

The district court, however, entered its order before it

determined that the appellees did not owe continuing op-

erating services under the franchise agreements. Thus,

after it entered its order, it may have concluded that ap-

pellees did not in fact owe anything more to appellants

under the franchise agreements. In that case, appellants’

failure to pay the fees may have been a total breach.

See id. § 243 (“Effect of a Breach by Non-Performance as

Giving Rise To a Claim for Damages for Total Breach’’).

But, if that is the case, the damages flowing from the

total breach should have been reduced to a sum certain,

if possible. The only justification for ordering future

payments as they become due would be a finding of total

the absurd. Giant merely held that if a plaintiff obtains a liquidated

judgment, and the defendant prevails on a counterclaim that is “an

offset in the nature of payment [of the liquidated debt],” then the

plaintiff will be awarded interest only on the difference between his

claim and the defendant’s counterclaim. Jd. at 13803. Giant thus has

no bearing here where (1) appellants did not prevail on their claim,

and (2) the claim was not one for “an offset in the nature of pay-

ment.”

12 The district court explicitly noted it retained jurisdiction to

modify its order should the appellees fail in the future to perform

any of their obligations under the agreements. Williamsburg, slip

op. at 4 n.1 (Sept. 3, 1982) (Memorandum). It thus treated the con-

tract as an ongoing one imposing obligations on both appellees and

appellants.

27a

breach (after appellees performed their part of the con-

tracts) and so great an uncertainty about the amount of

damages (based on future gross receipts) that ordering

future payments was necessary to ensure their accurate

assessment. See id. §§ 359, 360 (specific performance

justified where damages not provable with reasonable

certainty). The court’s rationale is not sufficiently de-

veloped for us to determine if injunctive relief ordering

payment of franchise fees as they become due is war-

ranted under this theory. We remand to the district

court for a determination of whether the breach was

total or partial, and if total, whether the nature of the

promised payments justifies its order of future payments.

V. REMAINING ISSUES

We need not dwell long on the two remaining points

on appeal—the disqualification of C&B and the district

court’s order consolidating these three cases.

The appellants contend that the district court erred

by not finding that C&B had represented Gettysburg in

a matter “substantially related” to the franchise agree-

ments at issue here. Brief for Appellants, at 28. The

“substantial relation” test, which the district court prop-

erly invoked, was meant to protect an attorney’s former

client from subsequent use of confidential disclosures by

the attorney. See T.C. Theatre Corp. v. Warner Brothers

Pictures, Inc., 113 F. Supp. 265, 168 (S.D. N.Y. 1953).

The court should not “inquire into the nature and ex-

tent” of any confidential disclosures. Jd. Still, the party

seeking disqualification has the burden of demonstrating

a relationship between the matters in which counsel had

represented him and those at issue which makes it rea-

sonable to assume that some relevant confidential dis-

closures were made. See id. at 268; cf. Government of

India v. Cook Industries, Inc., 569 F.2d 737, 739 (2d

Cir. 1978) (movant must show matters are almost iden-

tical before court will disqualify counsel).

28a

In this case, the district court allowed the appellants

to develop a voluminous record on the extent of C&B’s

representation of Gettysburg. It found that C&B did not

represent Gettysburg on matters related to the franchise

agreement. It further noted that C&B’s representation

of Gettysburg was handled primarily through Dennis,

who in addition to being owner of appellee Historic was

then a conventurer in appellant, Gettysburg. Thus, it

concluded that C&B was not in a position to receive in-

formation that Gettysburg intended to keep confidential

vis-a-vis Historic. We do not think these factual find-

ings are erroneous, much less clearly so. Cf. Allegaert

v. Perot, 565 F.2d 246, 250 (2d Cir. 1977) (holding

“substantial relation” test not even implicated in such a

situation).

Finally, the issue of whether these cases should not

be consolidated because the antitrust issues are so com-

plex that, at trial, a jury might be confused is mooted

by our prior rulings.

CONCLUSION

For the reasons stated above, we affirm the district

court’s grant of summary judgment for appellees on ap-

pellants’ tying claims, but vacate that grant on Gatlin-

burg’s monopolization claim stemming from its lease of

Lynch figures and remand for further proceedings on

that claim. We also affirm the grant of summary judg-

ment for appellees on their contract claims for monies

due under the franchise and lease agreements, but va-

cate the order that appellants pay future fees as they

become due, remanding to the district court for recon-

sideration of that order. We affirm the district court

on all other rulings.

It is so ordered.

29a

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1983

Civil Action No. 77-01243

No. 82-2329

NATIONAL SOUVENIR CENTER, INC., et al.,

Appellants

HISTORIC FIGURES, INC., et al.

And Consolidated Case Nos. 82-2330,

82-2337, 83-1268, 83-1269 and 83-1270

[Filed Feb. 10, 1984]

Before: TAMM and WALD, Circuit Judges, and

HENLEY, “Senior Circuit Judge, United

States Court of Appeals for the Eighth

Circuit.

ORDER

It is ORDERED, by the Court, sua sponte, that the

Opinion for the Court filed by Circuit Judge Wald on

February 10, 1984 be, and hereby is amended as follows:

Page 23 of the slip opinion, lines 1 & 2, delete the

first two lines of the text in their entirety, and in

lieu thereof substitute the following:

* Sitting by designation pursuant to 28 U.S.C. § 294(d).

30a

“on purchase of non-union coal. By linking contrib-

utions to the purchase of non-union coal, this promise

on its face’’.

Per Curiam

For the Court

/s/ George A. Fisher

GEORGE A. FISHER

Clerk

Note: The language amended by this Order appears on

p. 22a of Appendix A.

3la

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Washington, D.C. 20001

GEORGE A. FISHER

Clerk

February 10, 1984

RE: Appeal No. 82-2329 et al_—National Souvenir Cen-

tex, Inc., et al. v. Historic Figures, Inc., et al.

Dear Sir:

Enclosed herewith are three (3) copies of the opinion

in the above entitled case.

Please note that the judgment has been entered on the

same date as the opinion and is for mandate purposes

only.

Sincerely,

/s/ Denise C. Thomas

DENISE C. THOMAS

Opinions Clerk

Enclosure

DISTRIBUTION:

Nelson Deckelbaum

Jerome S. Wagshal

James C. McKay

82a

APPENDIX B

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Civil Action No. 77-0093

WILLIAMSBURG WAX MUSEUM, INC.,

. Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-0131

NATIONAL CivIL WAR WAX MUSEUM, INC.,

Plaintiff,

Vv.

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-1243

NATIONAL SOUVENIR CENTER, INC., et al.,

. Plaintiffs,

HISTORIC FIGURES, INC., et al.,

Defendants.

[Filed May 19, 1981]

MEMORANDUM ORDER

The above-entitled actions are before the Court on

defendants’ motions for summary judgment.’ Plaintiffs

1 These actions are related, although not consolidated, and involve

essentially the same parties and the same claims. Virtually iden-

tical papers have been filed by the parties in all three cases, the

instant motions for summary judgment were argued together, and

33a

complain that various agreements between themselves and

defendants, and agreements among the defendants, vio-

late the antitrust laws; defendants counterclaim for the

fees due and owing under their agreements with plain-

tiffs.* Because the Court finds that there are genuine is-

sues of material fact with regard to plaintiffs’ claims,

defendants’ motions concerning those claims must be

denied. Defendants’ motions in connection with their

counterclaims present different considerations, however,

and will be granted.®

In 1958, Frank Dennis, who was until 1977 the presi-

dent and chief operating officer of defendants Historic

Figures, Inc. (HF), and National Historical Museum,

Inc. (NHM), a subsidiary of HF, established a wax

museum in Washington, D.C., with the assistance of de

fendant Dorfman, the founder, president, and principal

stockholder of defendant Lynch Display Corporation

(Lynch), the manufacturer of the figures displayed in

the museum. Unlike the wax figures displayed in the

European wax museums that had inspired Dennis to

create a similar museum in Washington, the figures de-

signed and manufactured by Dorfman are composed of a

plastic material.

The defendants entered into a series of agreements

over the years since the founding of the Washington

museum, all of which are exclusive sales agreements per-

there is no factua! difference that would warrant a different resuit

in the resolution of the pending motions. This order is dispositive

of defendants’ summary judgment motions in all of the above-

entitled actions.

* Defendants have moved for summary judgment on all claims,

including their counterclaims.

5 Also before the Court are plaintiffs’ request that certain lan-

guage be deleted from the Court’s order of February 11, 1981, and

two motions by plaintiffs to strike. These have been considered

by the Court and are denied.

84a

taining to the display figures. The more recent agree-

ments take into account the “franchise” enterprise de-

veloped by defendants subsequent to the establishment of

the Washington museum. Basically, the defendants bound

themselves contractually to package together the sale* of

the Lynch figures and the “franchises”*® for new wax

museums. Pursuant to these agreements, defendants

have franchised a number of museums, including those

of the plaintiffs, in conjunction with the sale or lease

of the Lynch figures. Under the “franchise” agreements,

defendants were obligated to provide various start-up

services or products,® and they agreed to “make them-

selves available” to provide further services at additional

cost, in exchange for a fee of five percent of the fran-

chisee’s annual gross receipts.’ With regard to the three

museums involved in these lawsuits, the total franchise

fees (including those paid and those that are the subject

of the defendants’ counterclaims) amount to more than

4In the case of the Gatlingburg museum, No. 77-1243, the figures

were leased on a long-term basis rather than sold. This lease agree-

ment is also challenged, both as part of an illegal tie-in and as

an unlawful exercise of monopoly power.

5 Although the word “franchise” is used in the challenged agree-

ments and in this Memorandum, the characteristics that generally

typify a franchise arrangement are not present here: there is no

operation under a common name or designation, no coeperative

advertising, no periodic inspections, and no establishment of com-

mon standards or business practices.

6 The possible application of Section 3 of the Clayton Act to the

facts of these cases turns on whether that which was supplied under

the franchise agreements is in the category of “services,” as that

section applies only to “goods, wares, merchandise, machinery, sup-

plies or other commodities.” This is one issue of fact which the

Court finds unresolved, and the Court will therefore not dismiss the

counts alleging Clayton Act violations.

7The payments are to continue indefinitely under the contract

applicable to the Gatlinburg museum; the payments are limited to a

period of 20 years in the agreements regarding the other two

museums.

35a

$750,000; the lease fees incurred by the Gatlinburg

plaintiff amount to more than $500,000. The figures, of

course, do not reflect the amounts involved in connection

with the other seven museums franchised by defendants

in the United States.

In deciding a motion for summary judgment, factual

matters must be viewed in the light most favorable to the

party opposing the motion. Founding Church of Scien-

tology v. NSA, 610 F.2d 824, 886 (D.C. Cir. 1979). The

inferences to be drawn from the facts must be viewed in

the same manner, United States v. Diebold, Inc., 369

U.S. 654, 655 (1962).

The basic claim*® in these actions is that defendants

unlawfully conditioned the sale or lease of the Lynch

display figures to plaintiffs upon the purchase of a “fran-

chise” by plaintiffs. There are two theories on which

plaintiffs may be able to prevail with respect to their tie-

in claims: (1) they may he able to establish a per se

tying violation; or (2) they may prevail on a Rule of

Reason analysis, that is, if they “can prove, on the basis

of a more thorough examination of the purposes and

effects of the practices involved, that the general stand-

ards of the Sherman Act have been violated,” Fortner

Enterprises, Inc. v. United States Steel Corp., 394 U.S.

495, 500 (1969) (Fortner 1). Accord, United States

Steel Corp. v. Fortner Enterprises, Inc., 429 U.S. 610,

8 Defendants assert that plaintiffs’ restraint of trade and monopo-

lization claims with regard to the exclusive dealing arrangements

between Lynch and NHM “add nothing to plaintiffs’ tie-in claims.”

Brief for Defendants at 27. No authority is cited in support of that

proposition and it apears to be contradicted by the Supreme Court’s

decision in United States Steel Corp. v. Fortner Enterprises, Inc.,

429 U.S. 610, 612 n. 1 (1977). Also rejected is defendants’ conten-

tion that the language of an amendment to the exclusive sales

agreement between Lynch and NHM compels dismissal, on the

theory of uncontested facts, of the claim regarding the Gatlinburg

lease agreement in No. 77-1248.

86a

612 n. 1 1977) (Fortner II); Bogus v. American Speech

& Hearing Association, 582 F.2d 277, 287 (3d Cir.

1978); Kentucky Fried Chicken Corp. v. Diversified

Packaging Corp., 549 F.2d 368, 380 (5th Cir. 1977).

The elements of a per se tying violation under Section

1 of the Sherman Act, as established in Northern Pacific

Railway v. United States, 356 U.S. 1 (1958), and reiter-

ated in Fortner I, supra, are (1) that the challenged

arrangement is in fact a tying arrangement, (2) that

the seller has sufficient economic power with respect to

the tying product, and (3) that a “not insubstantial”

amount of interstate commerce in the tied product is

affected.

As discussed below, the Court finds that there are

genuine issues of material fact with regard to each

of the three elements, and that defendants’ motions with

regard to plaintiffs’ tie-in claims must, therefore, be

denied.

III

To establish the first element, plaintiffs must prove

that separate products are involved, that is, that the

display figures and the “franchises” do not constitute a

single product.’

There are several issues of material fact in connection

with the question of whether a tying arrangement exists.

® Defendants argue that plaintiffs must, in addition, show coer-

cion. However, if there was, factually, a tying arrangement there

also was coercion. “Where the buyer is free to take either product

by itself there is no tying problem even though the seller may also

offer the two items as a unit at a single price.” Northern Pacific,

supra, 356 U.S. at 6, n.4. In order for plaintiffs to establish that

the arrangement is in fact a tying arrangement, they must show

that their purchase or lease of display figures was conditioned upon

their purchase of a “franchise,” that they could not have obtained

the display figures separately, and if they make that showing, they

have demonstrated coercion.

37a

Defendants assert that this is a “left shoe, right shoe”

matter, where one product goes hand-in-hand with the

other and severance would not be reasonable; that their

business is establishing wax museums, not selling display

figures and selling franchises; and that, even if the prod-

ucts are separable in today’s market, they were not

separable during the infancy of the wax museum in-

dustry in this country when the challenged agreements

were made. Plaintiffs, on the other hand, point out that

the products come from two different sources and are

priced separately. Plaintiffs also have submitted evidence

through affidavits, including that of a long-time officer of

the International Association of Wax Museums, that the

products are separable.

Thus, it is quite clear that the issue of whether the

display figures and the “franchise” * constitute one prod-

uct or more than one product is, on this record, an issue

of fact. Similarly, plaintiffs’ evidence in the form of writ-

ings by defendant Dorfman containing statements that the

Lynch display figures could not be obtained separately

from the NHM franchises, and the affidavit of the origi-

nal organizer of the Gatlinburg museum, Shelby Boyd, to

the same effect, are sufficient to raise an issue of ma-

terial fact with regard to the existence of a tying

arrangement in general and with regard to the coercion

matter in particular.”

The second element under Northern Pacific Railway—

sufficient economic power with respect to the tying prod-

uct, here the display figures—may be established through

a sufficient showing of uniqueness of those figures. De-

fendants contend in this respect that the Lynch figures

are not sufficiently unique and that plaintiffs could have,

10 Defendants’ attempt to analogize these cases to traditional fran-

chise cases falls short of the mark since, as noted supra at n. 5, the

arrangements in question are not typical franchises.

11 See note 9 supra.

38a

like Dennis, engaged the services of someone like Dorf-

man to manufacture the figures. Plaintiffs, on the other

hand, have submitted various statements by Dorfman and

Dennis to the effect that trade secrets are involved in

the manufacture of the figures and that satisfactory

substitutes were unavailable. Again, this question is a

genuine one of material fact that cannot be resolved on

this record.

The relevant figure for the purpose of assessing the

third element under Northern Pacific Railway—whether

a “not insubstantial” amount of interstate commerce in

the tied product is affected—is “the total volume of sales

tied by the sales policy under challenge,” Fortner I,

supra, 394 U.S. at 502. On this issue, defendants assert

that there is no genuine issue as to whether a “not

insubstantial” amount of interstate commerce in the tied

product is affected, arguing that plaintiffs disparage the

“franchise” as worthless and that a substantial portion of

the franchise fees actually represents deferred payments

for other items. But that, too, clearly, is an issue of

fact; it must be decided on that basis;?* and summary

judgment on a per se theory is not proper.”

IV.

The final issue before the Court concerns defendants’

counterclaims for the fees due and owing under the

12 Moreover, the dollar amounts involved here total a great deal

more than the $180,000 held “not insubstantial” by the Supreme

Court in Fortner I, supra, 394 U.S. at 502, and the three museums

operated by plaintiffs represent only a portion of defendants’ busi-

ness in display figures and franchises.

13 Moreover, defendants seem to assume that if they were to estab-

lish as a matter of law that plaintiffs cannot prove a per se viola-

tion they would be entitled to summary judgment on plaintiffs’

claims. That is not the law. Even if—contrary to the Court’s con-

clusion—defendants could prevail on summary judgment as to the

per se theory, plaintiffs would still be entitled to proceed under a

“rule of reason” analysis.

89a

franchise agreements and the Gatlinburg lease agree-

ment. The general rule is that a plea of illegality based

on violation of the Sherman Act is not an adequate de-

fense to an action based on contract. Kelly v. Kosuga,

358 U.S. 516, 518 (1959); Mullins v. Kaiser Steel Corp.,

—— F.2d ——, 1980-2 Trade Cas. § 63,537 (D.C. Cir.

1980). The exception into which plaintiffs attempt to

squeeze these cases arises where enforcement of the con-

tract “would itself be enforcing the precise conduct made

unlawful by the Act.” Kelly v. Kosuga, supra, 358 U.S.

at 520-21. But as the court made clear in Mullins, supra,

that exception is “tiny”; it “does not lie against a con-

tract that is ‘an intelligible econorric transaction in

itself’ ”’; and only if enforcement of an otherwise valid

contract would make the court a party to the illegality

will it opt in favor of a windfall for the innocent party

to the contract. Mullins v. Kaiser Steel Corp., supra,

1980-2 Trade Cas. at pp. 76,887-89.

Plaintiffs argue that granting defendants’ summary

judgment motions with respect to the counterclaims

would amount to “deciding the case without determining

the antitrust claim.” Plaintiffs’ Reply Memorandum at

16. On the contrary, under the standards enunciated by

the Supreme Court in Kelly and by the Court of Appeals

for this Circuit in Mullins, denying summary judgment

on the counterclaims would be tantamount to deciding the

antitrust claims in favor of plaintiffs.‘* In order to pre-

vail on the counterclaims, defendants need not show that

the franchise and lease agreements at issue do not violate

the antitrust laws; a showing solely to the effect that

those agreements do not fall within the Kelly exception

permits the Court to “simply refuse to entertain the il-

legality defense,” Mullins, supra, 1980-2 Trade Cas. at

14 Plaintiffs have not moved for summary judgment in these

actions. Further, even if all of plaintiffs’ factual allegations are

true, the purported illegality of the disputed agreements is by no

means clear.

40a

76,887, n.6. The Supreme Court’s reluctance to supple-

ment the remedies provided by the antitrust laws is par-

ticularly appropriate where, as here, plaintiffs’ claims for

relief under those statutes are before the Court. Ac-

cordingly, defendants are entitled to prevail on their

counterclaims.

In accordance with the foregoing, it is this 18th day of

May, 1981,

ORDERED That defendants’ motions for summary

judgment with regard to the complaints in the above-

entitled actions be and they are hereby denied, and it is

further

ORDERED That defendanis’ motions for summary

judgment with regard to all of their counterclaims in the

above-entitied actions be and they are hereby granted as

to liability, and it is further

ORDERED That defendants shall file within 15 days of

the entry of this order a motion for summary judgment

as to damages with respect to all of their counterclaims,

and plaintiffs shall have 15 days thereafter in which to

respond to such motion.

/s/ Harold H. Greene

HAROLD H. GREENE

United States District Judge

4la

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Civil Action No. 77-0093

WILLIAMSBURG WAX MUSEUM, INC.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-0131

NATIONAL CIVIL WAR WAX MUSEUM, INC.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-1243

NATIONAL SOUVENIR CENTER, INC., et al.,

Piaintiffs,

HISTORIC FIGURES, INC., et al.,

Defendants.

[Filed Sept. 3, 1982]

42a

ORDER AND FINAL JUDGMENT

On May 18, 1981, the Court granted summary judg-

ment in favor of defendants as to plaintiffs’ liabiility on

defendants’ counterclaims. On June 3, 1981, in <accord-

ance with the Court’s May 18 order, defendantts filed

motions for summary judgment as to damages. There-

after, plaintiffs filed an opposition to defendants’ motions

as well as their own motion to stay further proceedings

or in the alternative for reconsideration of the Court’s

grant of defendants’ summary judgment motions with

respect to the issue of liability. Plaintiffs also requested

oral argument with respect to these matters. By order of

September 17 the Court denied plaintiffs’ motions for

stay or reconsideration. Thereafter, on February 8, 1982,

plaintiffs moved to vacate this Court’s order gianting

summary judgment as to the issue of plaintiffs’ liability

on defendants’ state law counterclaims.

Upon consideration of plaintiffs’ February 8 motion to

vacate and defendants’ earlier motion for summary judg-

ment as to damages, and upon consideration of the papers

submitted by the parties in connection therewith and the

entire record in this case, and the Court having con-

cluded that, subject to the provisions of paragraph 10

below, plaintiffs’ motion should be denied and defendants’

motion should be granted, and having determined that

there is no just reason for delay of entry of final judg-

ment on the counterclaims, it is this 3d day of September,

1982, ordered as follows:

I. Williamsburg Franchise Agreement Obligations

1. The motion of defendant National Historical Mu-

seum, Inc. (“NHM”’), for summary judgment as tto dam-

ages on its counterclaim is granted, jointly and severally,

against plaintiff Williamsburg Wax Museum, Inc., and

all successor corporations thereto (including C. M. Uber-

man Enterprises, Inc.), hereinafter collectively desig-

43a

nated as “Williamsburg plaintiffs,” in the amount of

$56,382.99 plus such additional interest with respect to

overdue franchise fees at the rate of six (6) percent per

year as accrued between February 1, 1982, and the date

of this Order and Final Judgment, with interest on the

combined amount thereof at the rate of six (6) percent

per year from the date of this Order and Final Judgment

until the date of payment thereof.

2. Wiiliamsburg plaintiffs are ordered and directed to

pay to NHM all future franchise fees as they become due

in accordance with the terms of the Williamsburg fran-

chise agreement and shall furnish to NHM all such

financial reports and make available all such books and

records as NHM may request in accordance with the pro-

visions of said agreement.

II. Gettysburg Franchise Agreement Obligations

3. The motion of NHM for summary judgment as to

damages on its counterclaim is granted, jointly and sev-

erally, against plaintiff National Civil War Wax Museum,

Ine., and all successor corporations thereto (including

C. M. Uberman Enterprises, Inc.), hereinafter collectively

designated as “Gettysburg plaintiffs,” in the amount of

$94,243.60 plus such additional interest with respect to

overdue franchise fees at the rate of six (6) percent per

year as accrued between February 1, 1982, and the date

of this Order and Final Judgment, with interest on

the combined amount thereof at the rate of six (6) per-

cent per year from the date of this Order and Final

Judgment until the date of payment thereof.

4. Gettysburg plaintiffs are ordered and directed to

pay to NHM all future franchise fees as they become due

in accordance with the terms of the Gettysburg franchise

agreement and shall furnish to NHM all such financial

reports and make available all such books and records as

NHM may request in accordance with the provisions of

said agreement.

44a

III. Gatlinburg Franchise Agreement Obligations

5. The motion of NHM for summary judgment as to

damages on its counterclaim is granted, jointly and sev-

erally, against plaintiff National Souvenir Center, Inc.,

plaintiff Historical Reviews, Inc., and all successor corpo-

rations thereto (including C. M. Uberman Enterprises,

Inc.), hereinafter collectively designated as “Gatlinburg

plaintiffs,” in the amount of $112,161.35, plus such addi-

tional interest with respect to overdue franchise fees at

the rate of six (6) percent per year as accrued between

February 1, 1982, and the date of this Order and Final

Judgment, with interest on the combined amount thereof

at the rate of six (6) percent per year from the date of

this Order and Final Judgment until the date of payment

thereof.

6. Gatlinburg plaintiffs are ordered and directed to

pay to NHM all future franchise fees as they become

due in accordance with the terms of the Gatlinburg

franchise agreement and shall in connection therewith

furnish to NHM all such financial reports and make

available all such books and records as NHM may request

in accordance with the provisions of said agreement.

IV. Gatlinburg Lease Agreement Obligations

7. The motion of defendant Lynch Display Corporation

(“Lynch”) for summary judgment as to damages on its

counterclaim is granted, jointly and severally, against

Gatlinburg plaintiffs in the amourt of $328,859.94 plus

such additional interest with respect to overdue display

figure rental payments at the rate of ten (10) percent

per year as accrued between February 1, 1982, and the

date of this Order and Final Judgment, with interest on

the combined amount thereof at the rate of six (6) per-

cent per year from the date of this Order and Final

Judgment until the date of payment thereof.

45a

8. Gatlinburg plaintiffs are ordered and directed to

pay to Lynch all future monthly rental fees and percent-

age rent as they become due in accordance with the terms

of the Gatlinburg lease agreement and shall furnish to

Lynch all such financial reports and make available all

such books and records as Lynch may request in accord-

ance with the provisions of said agreement.

V. Finality

9. The Court having determined that there is no just

reason for delay, this Order and Final Judgment shall be

entered forthwith.

VI. Stay of Judgment

10. In accordance with Fed. R. Civ. P. 62(h), enforce-

ment of this Order and Final Judgment shall be stayed

until the entry of final judgments on plaintiffs’ com-

plaints, or until further order of this Court, subject to

the condition that within ten (10) days the parties, or

any of them, submit to the Court for its approval a plan

and proposed order pursuant to which plaintiffs will be

required to deposit with the Clerk of the Court all past

due franchise and rental fees, plus interest, as provided

in paragraphs 1, 3, 5 and 7 of this Order and Final

Judgment, and all future franchise and rental fees as

they become due, and pursuant to which the Clerk will

be directed to purchase United States treasury bills or

other high-yield, appropriately secured obligations and

hold them or re-invest them in similar securities pending

the entry of final judgments on plaintiffs’ complaints or

until further order of this Court.

VII. Retention of Jurisdiction

11. The Court shall retain jurisdiction to effectuate

and enforce the terms of this Order and Final Judgment.

/s/ Harold H. Greene

HAROLD H. GREENE

United States District Judge

46a

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Civil Action No. 77-0093

WILLIAMSBURG WAX MUSEUM, INC.,

Plaintiff,

Historic FicurEs, INC., et al.,

Defendants.

Civil Action No. 77-0131

NATIONAL CiviL WAR WAX MUSEUM, ING.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-1243

NATIONAL SOUVENIR CENTER, INC., et al.,

Plaintiffs,

Vv.

Historic FIGURES, INC., et al.,

Defendants.

[Filed Sept. 3, 1982]

47a

MEMORANDUM

On May 19, 1981, the Court granted defendants’ mo-

tions for summary judgment as to liability on the

counterclaims. Plaintiff has moved to vacate that judg-

ment on the basis of Kaiser Steel Corp. v. Mullins, 102

S.Ct. 851 (1982). Kaiser Steel reversed Mullins v. Kaiser

Steel Corp., 642 F.2d 1802 (D.C. Cir. 1980), and it

distinguished Kelly v. Kosuga, 358 U.S. 516 (1959) on

both of which this Court had relied in its grant of sum-

mary judgment. The motion to vacate essentially pre-

sents the question whether the instant action is controlled

by the factual situation and the law underlying the Su-

preme Court’s decision in Kaiser Steel or by the facts

and the law in the earlier Kosuga.

In Kaiser Steel it was held that a coal producer, when

sued on its promise to contribute to union welfare funds

based on its purchases of coal from producers not under

contract with the union, is entitled to defend based on the

illegality of that promise under the antitrust laws. In so

holding, the Court departed from the broad pronounce-

ment of the Court of Appeals in the same case which had

suggested, as this Court said in its May 19, 1981 memo-

randum, that a plea of illegality based on a violation of

the Sherman Act could not be a defense to an action

based on contract. Kaiser Steel laid down a narrower

and more specific rule. If, as in Kosuga, there are two

promises in a business relationship, one legal and the

other illegal, the legal promise will be enforced notwith-

standing the unenforceability of the second promise under

the antitrust laws. On the other hand, if, as under the

Kaiser Steel facts, the promise being sued on is itself

illegal under the antitrust laws, it will not be enforced.

Here, defendants are 3uing in their counterclaim for

monies for goods or services furnished to plaintiff over

a period of years. Plaintiff’s promises to pay for those

48a

goods and services are quite separate and distinct from

the. possible obligation of defendants to pay damages

should it ultimately be found, after a trial, that the pro-

visions of the contracts which conditioned the sale or

lease of the display figures at issue here, violated the

antitrust laws. These damages would then be measured

in accordance with the evidence adduced with respect to

the alleged tie-in feature; they would not necessarily in-

clude a recovery of the fees paid and to be paid by

plaintiff under the contract. Yet it is that which plain-

tiff is, in effect, demanding in its defense to the counter-

claim. To extend Kaiser Steel as plaintiff would have it

would be potentially to embroil the antitrust laws in every

suit to collect payment for goods and services. The

motion to vacate will be denied.

The parties have each submitted a proposed order and

final judgment regarding damages as well as various

memoranda on those issues in relation thereto that re-

main contested.

First. On the question of pre-judgment interest, plain-

tiff relies upon Giant Food, Inc. v. Jack I. Bender &

Sons, 399 A.2d 1293 (D.C. App. 1979) in support of the

proposition that the Court is precluded from awarding

such interest. In Giant Food, the D.C. Court of Appeals

held that on passing upon the prejudgment interest ques-

tion where there is both a liquidated claim and an un-

liquidated counterclaim, the District of Columbia courts

must apply an “interest on balance” rule, that is, pre-

judgment interest is to be awarded only on the amount

by which the liquidated claim exceeds the unliquidated

claim. However, the key fact in that case was that the

unliquidated claim, like the liquidated claim, had been

reduced to judgment; here not only has there been no

judgment but there may never be a judgment in plain-

49a

tiff’s favor. There is no basis for plaintiff’s opposition

to pre-judgment interest.

Second. Plaintiff contends that defendants are not en-

titled to injunctive relief requiring payment of future

franchise and rental fees and granting them access to

plaintiff’s books and records for the purpose of verifying

such payments. The Court has held that plaintiffs are

liable for the fees due and owing, and it is established,

therefore, that plaintiffs will be liable for future fran-

chise and rental fees as they become due. The Court will

not, and it need not, require defendants to file a new law-

suit or a new motion for summary judgment every time

another payment under the agreement becomes actually

due and owing.'

Third. Defendants have requested that the Court direct

the entry of judgment on the counterclaim pursuant to

Rule 54(b), Federal Rules of Civil Procedure, presum-

ably in order that they may execute thereon. Plaintiff

claims that (1) the counterclaim and the principal claim

are so intimately linked that the Court should not permit

execution on the judgment with respect to the former

pending the outcome of the litigation with regard to the

latter, and (2) defendants may not be solvent. But, as

indicated in Part I supra, the claims and the counter-

claims are not truly dependent upon one another. As con-

cerns the possible solvency of defendants, they have

recommended that the Court adopt the procedure sug-

gested in Curtiss-Wright Corp. v. General Electric Co.,

446 U.S. i, 13 n. 3 (1980) of requiring the losing party

to deposit the amount of the judgment with the Court,

directing the Clerk to purchase high yield government ob-

ligations and to hold them pending the outcome of the

1 Plaintiff argues that defendants may fail in the future to per-

form the agreements or to meet the obligations they impose. Since

the Court will retain jurisdiction, it will be able to modify or vacate

the injunction should the remcte contingency envisioned by plaintiff

actually occur.

50a

ease. The Court will follow that recommendation and

thus eliminate any concern regarding defendants’ sol-

vency.

/s/ Harold H. Greene

HAROLD H. GREENE

United States District Judge

Dated: September 3, 1982

5la

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Civil Action No. 77-0093

WILLIAMSBURG WAX MUSEUM, INC.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-0131

NATIONAL CivIL WAR WAX MUSEUM, INC.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-1243

NATIONAL SOUVENIR CENTER, INC., et al.,

Plaintiffs,

HISTORIC FIGURES, INC., et al.,

Defendants.

ORDER

For the reasons stated in the accompanying memor-

andum filed on this date, it is this 23d day of December,

1982,

52a

ORDERED That defendants’ motion for summary

judgment in civil actions 77-0131 and 77-0093 and for

partial summary judgment in civil action ‘77-1243 be

and it is hereby granted, and it is further

ORDERED That the complaints in civil actions 77-

0131 and 77-0093 be and they are hereby dismissed with

prejudice, and it is further

ORDERED That those counts of the complaint in civil

actions 77-1243 alleging antitrust violations due to an

illegal tying arrangement be and they hereby are dis-

missed with prejudice.

/s/ Harold H. Greene

HAROLD H. GREENE

United States District Judge

53a

The following ruling is reported at: 554 F. Supp. 182

(D.D.C. 1982); 1982-83 Trade Cas. § 65,202 (Dec. 23,

1982)

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Civil Action No. 77-0093

WILLIAMSBURG WAX MUSEUM, INC.,

Plaintiff,

Vv.

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-0131

NATIONAL CIVIL WAR WAX MUSEUM, INC.,

Plaintiff,

HISTORIC FIGURES, INC., et al.,

Defendants.

Civil Action No. 77-1243

NATIONAL SOUVENIR CENTER, INC., et al.,

Plaintiffs,

HISTORIC FIGURES, INC., et al.,

Defendants.

MEMORANDUM

Plaintiffs in thess consolidated antitrifst cases are three

wax museums owned in common by C. M. Uberman En-

terprises, Inc. since 1973. Each museum came into being

54a

in the 1960’s by means of a “franchise agreement”

with defendant National Historic Museum, Inc., the

wholly owned subsidiary of Historic Figures, Inc. Plain-

tiffs challenge these contracts as illegal tying arrange-

ments. They contend that the defendants acted in con-

cert illegally to condition the sale or lease’ of Lynch’s

display figures on the purchase by plaintiffs of National

franchise agreements.? The agreements obligated the

museums to pay National five percent of their gross

admissions receipts for twenty years* in exchange for

National’s promise to provide certain services and to

refrain from establishing competing museums in nearby

locations.* Plaintiffs survived a previous motion for sum-

mary judgment in which defendants maintained that no

tying violation could have occurred because each contract

involved only one product, the establishment of a wax

museum. The Court held that whether the contracts

1 The figures were sold to Gettysburg (77-0131) and Williamsburg

(77-0093). They were leased to Gatlinburg (77-1243). Although

the franchise/lease arrangement in Gatlinburg is challenged on a

tying theory, the lease is the target of a separate challenge along

the lines of a “refusal to sell’ such as existed in Hanover Shoe, Inc.

v. United Shoe Machinery Corp., 392 U.S. 481 (1968).

2 Historic Figures, Inc. and National Historical Museum, Inc. had

established a wax museum in Washington, D.C. with the help of

defendant Dorfman, the founder, president and principal stock-

holder of defendant Lynch Display Corporation (Lynch). The

defendants later bound themselves contractually to package together

the sale of the Lynch figures and the “franchises” for new wax

museums.

%In addition, the Williamsburg museum agreed to pay National

at a rate of 2!» percent for every year of operation past twenty

years.

* The first franchise agreement states that the percentage pay-

ments are “in consideration of the unique figures and services to be

performed by National.” The second and third agreements refer

only to services, presumably because the Gatlinburg museum con-

tracted separately to lease the figures directly from Lynch and the

Williamsburg museum contracted to buy them from Lynch.

55a

covered one or two products was a material question of

fact inappropriate for summary disposition. Now de-

fendants have moved for summary judgment in two cases

and partial summary judgment in the third® on the

ground that insofar as a tying violation is alleged, it is

barred by the Clayton Act’s four-year statute of limita-

tions, 15 U.S.C. § 15b.° As the contracts that underlie

plaintiffs’ claims were admittedly executed well over four

years before plaintiffs filed their complaints in 1977,’ the

question for decision is whether plaintiffs may invoke

one of the judicially-crafted exceptions to Section 15b.

After careful consideration of the parties’ pleadings and

their presentations at oral argument, the Court finds that

no exception is applicable. Defendants’ motion will there-

fore be granted.

The two exceptions to which plaintiffs point *® are not

really exceptions at all, but they are actually construc-

tions of what it means for a private antitrusi action

to “accrue.” Under the first of these two constructions,

a new cause of action accrues “whenever the defendant

commits an overt act in furtherance of an antitrust con-

spiracy, or in the absence of an antitrust conspiracy,

5 Plaintiffs’ claim that the Gatlinburg lease was a refusal to sell

and an unlawful exercise of monopoly power is unaffected by the

instant motion. See note 1, supra.

6 Section 4B of the Clayton Act, 15 U.S.C. § 15b, provides:

Any action to enforce any cause of action under sections 15

or 15a of this title shall be forever barred unless commenced

within four years after the cause of action accrued.

Plaintiffs brought these actions under the treble damages provision

of Section 15.

7 The Gettysburg contract was executed September 22, 1960. The

Gatlinburg contract was executed May 31, 1962. The Williamsburg

contract was executed September 22, 1967.

8 Plaintiffs do not invoke the exceptions triggered by a defend-

ant’s fraudulent concealment or by the prior initiation of a govern-

ment antitrust action.

56a

commits an act that by its very nature is a continuing

antitrust violation.” Kaiser Aluminum & Chemical Sales,

Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1951

(5th Cir. 1982) (citing Zenith Radio Corp. v. Hazeltine

Research, Inc., 401 U.S. 321, 338-40 (1971) and Hanover

Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481,

501 r.15 (1968)).® Thus, no matter how long ago the

initial antitrust violation occurred, the action will not be

time-barred by § 15b “if defendant committed further

overt acts or continuing violations which injure plaintiff's

business during the limitations period.” Electroglas, Inc.

v. Dynatex Corp., 497 F. Supp. 97, 104 (N.D. Cal. 1980).

The second construction is more concerned with the effects

of a defendant’s allegedly illegal act. It allows that act

to be “ ‘revived’ outside the limitations period as a basis

for damages, tecause when the act originally occurred,

plaintiff’s damages were speculative or unprovable.”

Kaiser Aluminum, supra, 677 F.2d at 1051. This theory

also derives from Zenith, supra.

In an effort to bring themselves within the first theory,

plaintiffs have pointed to the continuing payments they

made to National, to National’s occasional demands for

payment, to National’s continuing obligation to be avail-

able should plaintiffs request its services, and to de-

fendants’ general “involvement” with plaintiffs’ busi-

nesses as evidence that “overt acts or continuing viola-

tions” occurred between 1973 and 1977. When asked to

explain the antitrust injury occasioned by these alleged

overt acts or continuing violations, however, plaintiffs’

counsel answered,

[T] hese plaintiffs were diminished in their business

and property. . . . [They] had to shell out money

they would not have wanted to shell out if that fran-

chise had not been tied to the sale of the figures.

9In Zenith, a conspiracy was alleged and proved. Hanover in-

volved no conspiracy but rather the unlawful exercise of monopoly

power.

57a

. . . [T]he money is being paid . . . and there is

the antitrust violation.

However, as two federal courts have observed, “the harm

that creates the new cause of action must be ‘antitrust

harm, i.e., a continuing injury to competition, not merely

a continuing pecuniary injury to a plaintiff.’” Kaiser

Aluminum, supra, 677 F.2d at 1055 (quoting Electro-

glas, Inc., supra, 497 F. Supp. at 105) (emphasis in

original). If the law were otherwise, the statute of limi-

tations would have little force whenever a contract al-

legedly executed in violation of the antitrust laws provided

for long-term payments: there would be no repose until

four years after the last installment payment. This

could be years after the original tainted bargain was

struck. In all likelihood, some witnesses would be un-

available." In any event, the case would be characterized

by exactly that sort of staleness which it is the object

of a statute of limitations to prevent."

A brief description of the parties’ relationship during

the years 1973 to 1977 suffices to show the accuracy of

counsel’s concession that his clients suffered only pecuni-

ary injury, not anticompetitive injury, within the limita-

tions period. By 1973 the museums had been operating

for some time, displaying the Lynch figures obtained in

the 1960’s and paying franchise fees to National on a

quarterly basis. National was still obligated to remain

10This is the case in the instant actions. For instance, three

of the five principals involved in the Gettysburg franchise are

deceased.

1! Cases cited by plaintiffs such as Fitzgerald v. Seamans, 553

F.2d 220 (D.C. Cir. 1977), are not to the contrary. There are no

cases that instruct courts to disregard the Clayton Act’s statute of

limitations simply because of the “strong congressional policy in

favor of antitrust enforcement by private damages suits.” Fitz-

gerald, supra, 553 F.2d at 227. The dicta to which plaintiffs refer in

Fitzgerald was limited to the speculative damages exception which,

for reasons elaborated upon below, is inapplicable to these cases.

58a

available to perform additional services upon plaintiffs’

request, and te refrain from establishing competing mu-

seums, but plaintiffs were under no obligation to buy

services from National or from any defendant. Plain-

tiff’s pleadings blame defendants for not providing

enough service to warrant the franchise fees’? at the

same time that they criticize them for exercising too

much involvement in plaintiffs’ businesses. In any

event, National was paid extra sums for the later serv-

ices it provided."* It is the law of these cases that the

parties intended any post start-up services to be paid

for separately, over and above the ongoing franchise fees.

Memorandum Order of May 19, 1981, at 3. Thus, plain-

tiffs were free to turn to other sellers of comparable

services; they were not locked into purchasing them from

National. There is no evidence that plaintiffs ever at-

tempted to buy services elsewhere nor that they were

foreclosed from doing so by some act of defendants.

Plaintiffs can point to no act within the limitations

period by which any of the defendants affected plaintiffs’

competitive standing either as sellers or buyers. All they

can complain of is their ongoing commitment to National

12 The first Uberman affidavit states that from 1973 to 1975

Uberman requested assistance from National, particularly in con-

nection with the museums’ advertising campaigns, but that assist-

ance was not forthcoming.

18 The second Uberman affidavit, filed in conjunction with plain-

tiffs’ supplemental reply memorandum, refers to numerous phone

bills that allegedly show Dorfman’s continued involvement with the

museums after 1973. The memorandum and affidavit failed to men-

tion how telephone calls and visits by Dorfman, the owner of Lynch

and a minority stockholder in the Gettysburg museum could amount

to acts causing antitrust injury to plaintiffs.

14 Most of the services anticipated by the agreements were start-

up services. The parties dispute what percentage of the franchise

payments is allocable to National’s future “availability.” They also

dispute the value of the services provided by National at the time

each museum opened. This haggling resembles a breach of contract

controversy more than an antitrust violation.

59a

to pay five percent of the annual gross receipts and the

occasional demands of defendants regarding that obliga-

tion. These are simply “the abatable, but unabated in-

ertial consequences of some pre-limitations action.” Poster

Exchange Inc. v. National Screen Service Corp., 517 F.2d

117, 128 (5th Cir. 1975).

A defendant’s continuing receipt of benefits under an

illegal pre-limitations contract may, in certain cir-

cumstances, prevent plaintiff’s case from being time-

barred. This doctrine was discussed in Kaiser Aluminum,

supra, the Fifth Circuit’s most recent pronouncement on

the application of § 15b to cases involving long-term pay-

ments. In Kaiser, the court held that the “continued re-

ceipt of contract payments” could work a tolling of § 15b

only where damages would have been speculative or un-

provable within four years of the initial antitrust viola-

tion. The Kaiser panel thus incorporated the Zenith spec-

ulative damages exception, and made it clear that its

earlier holding in Jmperial Point Colonnades Condo-

minimum, Inc. Vv. Mangurian, 549 F.2d 1029 (5th Cir.

1977), hinged on the fact that “damages ... were

not ascertainable at the time of the execution of the

contracts . . . because the defendants could arbitrarily

and unilaterally continue to engage in acts that amounted

to overt acts in furtherance of their antitrust conspir-

acy.” 575 F.2d at 523-24.

In its first reply memorandum, filed before Kaiser,

plaintiffs relied heavily on Mangurian. At oral argu-

ment, plaintiffs’ counsel attempted to fit the cases within

the limits imposed by Kaiser, arguing that because the

franchise fees were not quantified, but were based on

gross receipts and therefore would fluctuate depending

upon the museums’ performance, damages would not have

been provable within four years after the contracts were

executed. This is incorrect. The percentage had been

fixed in the contracts and defendants could not unilater-

ally change it.

60a

Moreover, a comparison with Zenith shows how inap-

propriate the speculative damages exception would be in

these cases. In Zenith, a pre-limitations act of defendant

had reduced plaintiff's share of the market. The conse-

quences of this reduced share would continue no matter

what Zenith or a court did. The Supreme Court there-

fore held that Zenith’s cause of action did not accrue

until Zenith’s loss could be more accurately measured. In

the instant case, any injury plaintiffs suffered was con-

fined to its dealings with National. Presumably damages

would be measured by the difference, if any, between the

amount plaintiffs paid for the tied account—the fran-

chise services—and the amount they would have paid for

comparable services on the open market. A court could

have reduced plaintiffs’ franchise obligations by this

amount, or eliminated them altogether on the theory that

the antitrust laws had been violated, at any time sub-

sequent to the execution of the contracts. All plaintiffs

had to do was to sue within the limitations period. It

was within the power of a court to make plaintiffs whole

(unlike the situation in Zenith, where external forces

would perpetuate and increase the consequences flowing

from plaintiff’s reduced market share) .

Thus, plaintiffs may not take advantage of the “con-

tinuing benefits” theory, because they fail to satisfy the

speculative damages element, nor can they take advan-

tage of the speculative damages theory standing alone.

Plaintiffs’ causes of action “accrued” at the time the con-

tracts with National were executed (1960, 1962 and

1967 respectively). No additional cause of action respect-

ing the tying allegations accrued in the four years before

plaintiffs filed their complaints." The allegations based

15 This holding is consistent with, if not compelled by, the Court’s

previous ruling awarding judgment on defendants’ counterclaims.

The Court held that defendants could collect unpaid and owing

franchise fees from plaintiffs because even if the contracts had been

executed pursuant to an illegal tie-in scheme, the contracts and pay-

6la

on defendants’ alleged tying must therefore be dis-

missed.**

/s/ Harold H. Greene

HAROLD H. GREENE

United States District Judge

Dated: December 23, 1982

ments thereunder were not in themselves illegal. Memorandum

Order of May 19, 1981; Memorandum of September 38, 1982; Order

and Final Judgment of September 3, 1982.

16 Plaintiffs have presented no reason why the leasing of the fig-

ures in Gatlinburg dictates a different result with respect to the

claims of illegal tying. The lease ran for twenty years, the same

length as the franchise agreements. There is no evidence that the

lease was renewed during 1973-1977 or that any other overt act

or continuing violation occurred, by virtue of the lease, to distin-

guish the Gatlinburg case from the two cases where the figures had

been purchased. Defendants have not interposed a statute of limita-

tions defense to the allegation that the lease was an unlawful exer-

cise of monopoly power, so this aspect of C.A. 77-1243 is left intact

by today’s ruling.

62a

APPENDIX C

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1983

Civil Action No. 77-01243

And Consolidated Case Nos. 82-2330,

82-2337, 83-1268, 83-1269, 83-1270

No. 82-2329

NATIONAL SOUVENIR CENTER, INC., et al.,

Appellants

HISTORIC FIGURES, INC., et al.

BEFORE: Tamm and Wald, Circuit Judges, and Hen-

ley *, Senior Circuit Judge, United States

Court of Appeals for the Eighth Circuit

[Filed Apr. 12, 1984]

ORDER

On consideration of the petition for rehearing of Appel-

lants, filed March 26, 1984, and of Appellants’ motion for

leave to file a supplemental memorandum, it is

ORDERED by the Court that the Clerk is directed to

file Appellants’ lodged suppiemental memorandum and it

* Sitting by designation pursuant to Title 28 U.S.C. § 294(d).

63a

FURTHER ORDERED by the Court that the petition

for rehearing is denied.

Per Curiam

For the Court:

GEORGE A. FISHER

Clerk

By: /s/ Robert A. Bonner

ROBERT A. BONNER

Chief Deputy Clerk

64a

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

September Term, 1983

Civil Action No. 77-01243

And Consolidated Case Nos. 82-2330,

82-2337, 83-1268, 83-1269, 83-1270

No. 82-2329

NATIONAL SOUVENIR CENTER, INC., et al.,

Appellants

Vv.

HISTORIC FIGURES, INC., et al.

BEFORE: Robinson, Chief Judge; Wright, Tamm,

Wilkey, Wald, Mikva, Edwards, Ginsburg,

Bork, Sealia and Starr, Circuit Judges, and |

Henley *, Senior Circuit Judge, United |

States Court of Appeals for the Eighth Cir-

cuit

[Filed Apr. 12, 1984]

ORDER

The Clerk is directed to file Appellants’ lodged supple-

mental memorandum in support of the suggestion for re-

hearing en bance.

Appellants’ suggestion for rehearing en banc and the

supplemental memorandum in support thereof have been

circulated to the full Court and no member has requested

* Sitting by designation pursuant to Title 28 U.S.C. § 294(d).

65a

the taking of a vote thereon. On consideration of the

foregoing, it is

ORDERED by the Court en banc that the aforesaid

suggestion is denied.

Per Curiam

For the Court:

GEORGE A. FISHER

Clerk

By: /s/ Robert A. Bonner

ROBERT A. BONNER

Chief Deputy Clerk

66a

APPENDIX D

STATUTES INVGLVED

Section 1 of the Sherman Act, 15 U.S.C. § 1 provides:

$1. Trusts, etc., in restraint of trade illegal; penaity

Every contract, combination in the form of trust

or otherwise, or conspiracy, in restraint of trade or

commerce among the several States, or with foreign

nations, is declared to be illegal. Every person who

shall make any contract or engage in any combina-

tion or conspiracy hereby declared to be illegal shall

be deemed guilty of a felony, and, on conviction

thereof, shall be punished by fine not exceding one

million dollars if a corporation, or, if any other per-

son, one hundred thousand dollars, or by imprison-

ment not exceeding three years, or by both said pun-

ishments, in the discretion of the court.

Section 4 of the Clayton Act, 15 U.S.C. § 15, provides:

§ 15. Suits by persons injured

(a) Amount of recovery; prejudgment interest

Except as provided in subsection (b) of this sec-

tion, any person who shall be injured in his business

or property by reason of anything forbidden in the

antitrust laws may sue therefore in any district court

of the United States in the district in which the de-

fendant resides or is found or has an agent, without

respect to the amount in controversy, and shall re-

cover three-fold the damages by him sustained, and

the cost of suit, including a reasonable attorney’s fee.

The court may award under this section, pursuant to

a motion by such person promptly made, simple in-

terest on actual damages for the period beginning on

the date of service of such person’s pleading setting

forth a claim under the antitrust laws and ending

67a

on the date of judgment, or for any shorter period

therein, if the court finds that the award of such in-

terest for such period is just in the circumstances.

In determining whether an award of interest under

this section for any period is just in the circum-

stances, the court shall consider only—

(1) whether such person or the opposing party, or

either party’s representative, made motions or as-

serted claims or defenses so lacking in merit as to

show that such party or representative acted inten-

tionally for delay, or otherwise acted in bad faith;

(2) whether, in the course of the action involved,

such person or the opposing party, or either party’s

representative, violated any applicable rule, statute,

er court order providing for sanctions for dilatory

behavior or otherwise providing for expeditious pro-

ceedings; and

(3) whether such person or the opposing party,

or either party’s representative, engaged in conduct

primarily for the purpose of delaying the litigation

or increasing the cost thereof.

(b) Amount of damages payable to foreign states

and instrumentalities of foreign states

(1) Except as provided in paragraph (2), any

person who is a foreign state may not recover under

subsection (a) of this section an amount in excess of

the actual damages sustained by it and the cost of

suit, including a reasonable attorney’s fee.

(2) Paragraph (1) shall not apply to a foreign

state if—

(A) such foreign state would be denied,

under section 1605(a) (2) of title 28, immunity

in a case in which the action is based upon a

commercial activity, or an act, that is the sub-

ject matter of its claim under this section;

68a

(B) such foreign state waives all defenses

based upon or arising out of its status as a

foreign state, to any claims brought against it

in the same action;

commercial activities; and

(D) such foreign state does not function,

with respect to the commercial activity, or the

act, that is the subject matter of its claim under

this section as a procurement entity for itself

or for another foreign state.

(b) Definitions

For purposes of this section—

(1) the term “commercial activity” shall have

the meaning given it in section 1603(d) of title

28, and

(2) the term “foreign state” shall have the

meaning given it in section 1603(a) of title 28.

Section 4B of the Clayton Act, 15 U.S.C. § 15(b), pro-

vides :

§15b. Limitation of actions

Any action to enforce any cause of action under

sections 15, 15a, or 15c of this title shall be forever

barred unless commenced within four years after

the cause of action accrued. No cause of action

barred under existing law on the effective date of

this Act be revived by this Act.

Section 16 of the Clayton Act, 15 U.S.C. § 26, provides:

§ 26. Injunctive relief for private parties; excep-

tion; costs

Any person, firm, corporation, or association shall

be entitled to sue for and have injunctive relief, in

69a

any court of the United States having jurisdiction

over the parties, against threatened loss or damage

by a violation of the antitrust laws, including sec-

tions 13, 14, 18, and 19 of this title, when and under

the same conditions and principles as injunctive re-

lief against threatened conduct that will cause loss

or damage is granted by courts of equity, under the

rules governing such proceedings, and upon the ex-

ecution of proper bond against damages for an in-

junction improvidently granted and a showing that

the danger of irreparable loss or damage is immedi-

ate, a preliminary injunction may issue: Provided,

That nothing herein contained shall be construed to

entitle any person, firm, corporation, or association,

except the United States, to bring suit in equity

for injunctive relief against any common carrier

subject to the provisions of subtitle IV of title 49, in

respect of any matter subject to the regulation, su-

pervision, or other jurisdiction of the Interstate

Commerce Commission. In any action under this sec-

tion in which the plaintiff substantially prevails, the

court shall award the cost of suit, including a reason-

able attorney’s fee, to such plaintiff.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.