# Petition for Writ of Certiorari — Fontana Aviation, Inc. v. Beech Aircraft Corp.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1971
- **Citation:** 401 U.S. 923

## Text

FONTANA AVIATION, INC, A Corroratiex,

ws,

BERCH AIRCRAFT CORPORATION, A gre
ate HARTROG-SCHNECK AVIATION, INC, A Cor-

PORATION,
PETITION FOR WRIT OF ‘RI TO THE
‘POR THE SEVENTH CIRCUIT.

Frances J. McUoxxens,
Joux Borst, Ja.
Ricnarp P. Campuris.
Attorneys for Pctitroner,
_ Pentana Aviation, lnc.
Of Counsel :
MoCorxeu., Cvars, Manoy & Borst,
134 Seuth La Salle Street,
RAndolph 6-9131

Paar
(Ytations To Opinion Below on. 2
EE WUaGee hhh aehebniesstsacssaacbueteun 2
ee ec ci ech bubs csbeeteeckiness inn 2
Statutory Provisions and Rules Invelved............ 3
eee cs ab dcaneebakeantened -
The Antitrust Vielations... 0... 6
The Fact and Amount of Damage.............. 19
The New Votel Quieres 17
Reasons for Granting the Writ. 19
i annchnentnadnasnesedeccksncnccke sail a Setadnds bd)
Appendix A—Statutes Invelwed ... 2.2.2... 8... Al
Appendix BR Memorandam Opinion of District Court A3
Order Dated March 10, 1968........... Al6
Opinion of The Court of Appeals Dated ©
SG GA, wn cccccaccsusscccs Ais
— Judgment Dated September 23, 1970 A33
Appendix (—(irder Dated October 19, 1970. ......... A35
CTTATIONS.
Cases.

A. C. Becken Co. v. Gemex Corporation, 272 F. 2d 1
SEL nv cnctiu suchabh sak hebikmicadeehae 23

Bigelow v. RKO Radic Pictures, 327 U. S. 251 (1946)
‘nbd heaenbssdeceshineviesdaweneanenebanl 6, 17, 19, 21

Continental Ore Co. v: Cen Ca Gap, SSS. 8.
PED 6060050 Eehebasekbescscceubeceuensanel 19, 23

“
Wairment Gtaxe Werks v. Owh Merk Oat O88, O87 UN
474 (TAR) pnd

Wien vo Ameren Five & Unenalty Ov, 29 FF. oa Ves
(ath Or, TA) 22

Moret.” Nationwnde Te. ted Net ou) Mere Te ted,
An S71 BOERS CFTR Oe, E887) Bt)
Porkins Standard (8108. 00) 08.682 (ERD) TR ot
_ Semper v. Unter O81 Oempany, 98 USES CN) Ot 2d
Utah Mie Company v. Unntinental Rakin Company,
ea FM 16t Cfeth Ole, TRS) a“
Witham 1. Rankin Oe. v. Nemartated WUD Vexters, 02 ¥.

Mie cM Ow, fe). ‘7.
Zomth Radke Corperation Harettine Research Vee.

418 Fo) ath Cir, 888), hie ah 24
Zomath Radio Corperation v. Hageltine Reewarch toe.

SC) re ARR
OW. OO GUNG... ..... MR... .. 060. ceensi. 2
Clayton Act: See. 4 (YUL BOL EA. 2
Sherman Act: See. EQUUS SLC. BU, 2, 3, 4,12
Rule Wb) and (c) of The Federal Rates of Civil

SEE 6 sShca dake ebs eRe Asakennes etka AW.

Miacellancous.
A Moore's Fed. Prac., 959.1513] pp. 3903-4......... 22

FPONTANA AVIATION, ING. A Oonronaden,

OR,

BENCH AIRCRAFT CORPORATION, A Conronnms,
axn HARTROG.SCHNNCK AVIATION, EXC, A Con

TURATION,
Respondents.

ie. Alli

PETITION FOR WRIT OF GERTIORARI TO THE
POR THE SBVENTH CIRCUIT.

Petitioner, Fontana Aviation, Inc. prays that a Writ of
Certiorari issue te review the judgment of the United
States Court of Appeals for the Seventh (Circuit entered in
the above entitled cause on September 23, 1970 insofar as
the judgment failed to disturb the District Court's grant of
a new trial based solely on the same legal grounds held
efrgneous by the court below in reversing the District
Court's grant of jedgment N. 0. V__

I]

*

The Wistert Cert’: neenerandem eqinien ix anpah
eho and i printed mm Appendix BR) hereteesfie. pp A
AW. The epinion of the Cwnrt of Agqweats i as vet enpah
the aad is printed in Agqpemdin BL refine. gp. NTR AR.

JeRBICTYON
The jedgwent of the Coert of Appeals wax entered on

September JR, 1870 ( Aqpetetix BR, refine. pp. ABR ARE) A

Vetitien for Rehearing with reapect only te the matter of
taxmmg costs was cranted and the pedement was nredified im
thix regard on Usteber 19. 1970 (Appendix CO) fefre. pp.
ASS AQS). The jartediction of thix Oeert & tnveked ander
2 UL Sc. grad). :

had lost new airplane sales amd profitx it week! have made

o

8
the atmownt of the vendict. The Osert of Apprats never.
thetess dechwed te dicturh the wee trial ender,
The questions preented are:
1. Witter ima private aptitewd ertion Ue’ jary de
termination of the caer of injury anol ite amount, when
Sepperted hy enmpetent and legally cafficient evidenen, i
conceive aml preciedes the trial jige from aserhing ~
the jury's fanetion by setting aside the jury's verdict and
ranting a.wew trial on the premed that the evidewee
trentattich the Fart of damage.

2. Whether reversal of a judgment NO, V. which
jrement was hased entirely ona mistate of law ax te the
nan -
ported the jury finding that the factual situation was as
follows (App. B, infra, p. Al9):

Prior to 1966, Beech’s contracts with its distri-
buters, and the contract that Beech distributors had
with their dealers? contained limitations upon the sale
of airplanes outside the distributors’ or dealers’ terri-
tory. There were provisions for inter-territorial finan- -
cial adjustments if such sajex outside the territory took
place. Further these territorial limitations had been the
subject of discussion between Beech and its distribu-
tors. These discussions ordinarily occurred at meetings
of the Beech distributor advisory council which met
and discussed mutual problems. The council ineluded
the president of Hartzog and the meetings were at-
tended by officials of Beech. In February 1964, the

minutes of the council indicated that there had been

— coneern expressed at legal ramifications of the portion

of the contract dealing with the territorial restrie-
tions.’’

The court below further held with respect to this evi-
dence that ‘‘the jury reasonably could have found that
for the purpose of lessening competition a rigid territorial
division had been worked out on a horizontal basis be-
tween the various distributors with the tacit approval of
Beech, which also participated therein a its own
distributor companies’? (App. B, infra, p. A24).

In addition to the territorial restrictions, Beech, by
agreement with the distributors, imposed airplane stoeking
requirements on independent dealers which were intended
to and had the effect of foreclosing competition in the sale

j
9
[3

. E\
of the larger twin engine or corporate class airplanes by

removing them from the economic reach of independent
dealers (PX 21, A. 1313-14).

The Beech sales policy manual which was incorporates
by reference into the standard distributer agreements
required ax a mitmum that the dealer stock in inventory

or as a current model demonstrator the model or class of |

plane sold in order to be entitled to a Class A discount of
20% (PX Gs, 71, A. 1387, 1391). Hartzeg’s. dealer con-
tracts (as well as those of other distributors) which were
expressly approved and countersigned by Beech at all
times contained these minimum requirements (PX 54, 105,
A. 1368, 1577). Dealers who did not satisfy Class A re-
quirements were Class B and received a lessef diseount
percentage, usually only 10%.
As non-stockingsdealers with only a 10% margin, the
independent dealers could not compete in price with the
distributors’ own dealer eompanies which received the
full 20% discount without being required to comply with
the foregoing stocking requirements (A. 83-4, 343, 886-7).
Further, in the case of the new King Air model, Beech
and the distributors agreed that sale of this airplane
would be restricted to the distributor organizations or
the distributors’ own: dealer companies. The standard dis-
tributor agreements provided that ‘‘All King Air firm
‘ orders are to be the result of contractual retail (only) sales
commitments on the part of the King Air distributor order-
ing the airplanes’’ (PX 130, A. 1687). A Beech vice presi-
dent testified ‘‘we do not accept orders from distributors
for King Airs other than demonstrators unless it is the
result of a retail sales commitment on their part’’ (A. 571)
and that this provision precluded distributors from fran-
chising independent dealers to sell the King Air and that
this continued to be Beech’s policy until at least February,
1968 (A. 571), well after termination of Fontana’s dealer-

ee ee

o

siup. As a consequence independent dealers were foreclosed
freee purchasing King Air aireraft for resale or demonstra
tien and were confined to a sales agent's or ‘bird deg’’
rele with ne control ever price in the sale of this air
eraft (PX 21, A. 1303-14).

While the court below im it« opinion did not speritirally
dincuss the evideace with respect to the stocking and King
Air restraints, it observed, **we find adequate supportive
evidence in the overall pattern of operation on which to
base a verdict with regard to the other matters of com.
plaint by Fontana, being the stecking requirement and the
restraint on sale of King Airs. All of these matters could
well have been foul by the jury as having been conceived
as part ofan illegal market control’’ (App. B, fra,
p. AZ).

Fontana’s dealer contract was terminated in early 1966
when it sought a contract precluded by the conspiracy
terms. Fontana sought a contract and terms which would
permit it to compete in the sale of corporate class planes
with Hartzog’s own dealer company. Specifically, Fontana
demanded to be franchised to sell the profitable King Air
as well as other larger airplanes (A. 396-8). Fontana
wanted a 20% discount but objected to stocking the en-

tire line of Beech planes in order to be entitled to it (A. 182,

317). This request was refused by Hartzog and when
Fontana persisted in its demands Hartzog terminated
Fontana’s dealership (A. 183). These conversations oe-
curred while the 1965 distributor agreements were still in
effect (A. 181).

Following notice of termination Fontana contacted two
other nearby Beech distributors in an effort to secure
a dealer contract. At that time the distributor agreements

had been amended to delete the express ‘restrictions on
out of territery airplane sales and the infringement penalty
provisions. However, there were no changes in the ter-
ritorial assignments in the 1966 contracts. What was pre-
* viously the distributor's ‘‘exclusive. territory”’ became his
“area of rexponsibility."’ Appointment of ‘‘authorized’’
dealers was restricted to those lorated within the distribu-
tor’s axnigned territery (1X 99, A. 1536-6; A. 115, 351-2).

Both distributors contacted by Fontana expressed initial
interest. After checking with Beech, however, and finding
that Beech opposed the appointment because of the fact
Fontana would be an out-of-territory dealer, the distribu-
tors declined to appoint Fontana a dealer (A. 406-8, 674-5).
(ime dixt ributor testified that appointment of Fontana would
represent a change in Beech's marketing policy as he under-
stood if and that if he were to appoint Fontana in disregard
of this policy Hartzog was likely to retaliate by appointing
a dealer in his distributor territory because it was a ‘‘two-
way street’? (A. 1116-17, 1124).

The court below held that the evidence was sufficient to
support a jury finding that both the termination and refusal
to appoint were in furtherance of the conspiracy terma,
stating (App. B, infra, p. A20):

... Karly in 1966, when the corporate class plane
market was just beginning to develop, representatives
of Fontana and Hartzog met, at which time Fontana
indicated it wanted a dealer contract which would per-
mit it to sell the relatively new King Air without being
required to purchase and stock the entire line of Beech
planes necessary to obtain a twenty pereent diseount.
Hartzog replied that Fontana should confine its sales
effcr's to single engine and light twin planes only and
that ** would not receive a contract permitting it to sell
King Air. Fontana indicated it would attempt to secure
a direct dealership from Beech. Hartzog replied that
if it did so Hartzog would cancel Fontana’s contract.

iz

Subsequently, Fontana unsuccessfully attempted to
secure a direct dealership frour Beech, which dechned
fo deviate from its established marketing setup through
distributors. Thereafter, Hartzog terminated the Fon
tana dealership contract as of April 15, 1966. Subse
quently, Fontana sought to secure an authorized dealer
ship from two other distributors, one lorated in Pontiac,
Michigan, and one jerated in Rochester, Minnesota.
These dist ributers, after checking with Beech, declingh
te enter into a dealership contract with Fontana.”

The damage claim was divided into two categories: (1)
these damages attributable to the conspiracy restraints
during the period Fontana was a dealer under Hartzog, and ~
(2) those damages attributable to claimed loxs of aircraft
sales during the period after termination to date of trial.

| As to the former, petitioner claimed total damages of
$09,423 consisting of (1) 612000 based on an infringement
penalty assessed against it for making an out-of territory
sale in violation of the territorial restrictions (PX 8 & 9,
A. 1291-1293); (2) 611,750 and $7,365 on two airplane sales
where under the conspiracy terme it was limited to a non-
stocking dealer discount of only wo instemd of the 20% |
discount reeeived by Hartzog’s own dealer company with-
out stecking (PX 1258 & 125, A. 1681); and (3) $49,308
ona King Air sale where under the conspiracy terms it
was limited to a sales agent's commission of $12,500 instead

2,0f the 20% discount received by Hartzog’s own dealer
company (PX 1A, A. 1680).

The court below expressly held that the territorial re-
straints and infringement penalty provisions violated See-
tion 1 and that there was eubstantial evidence to support a
jury finding and verdict based thereon. The court also held
that there was ‘‘adequate supportive evidence’’ from which
the jury could find that the stocking and King Air restraints
were part of the overall conspiracy to withdraw the corpo-

13

rate class plane market from the independent dealers ‘fen.
B, snfra, p. AZ).

Farther, the court below held with respect to the pre-
termination damages that the trial judge erred in examin-
ing each item separately and without regard to the overall
conspiracy or pattern of ‘illegal amet control’? (App.
K, tafra, p. A31).

There in ne suggeetion in the epinies of the court belsw
that the pre termination damage proofs were not competent
proeef of both the fact and amount of damage to the extent
of the $69,000 shown; however, since these damages would
not, standing alone, support the full amount of the jury
verdict of $150,000, the court devoted its diseussion of the
damage issues to the port termination damages.

As to post-termination damages, petitioner offered the
testimony of its offieer that ax a terminated dealer it was
unable to sell new Beech airplanes or pursue qualified pros-
pects who had manifested interest. in purchasing planes
(A. 677-8). After termination, Fontana had no established
xouree of supply, no aeeess to demonstrator aireraft, no
information on current prices, no sales and technical data,
and no vecess to Beech serviee and sales school support and
training for its staff (A. 542-51, 689-99, 720-5). Further,
Reech’s own vier president admitted that°a terminated
dealer trying to sell new-aireraft without a dealer contract
was under a crippling ‘‘competitive disadvantage’’ (A.
51). ;

The court below held that this evidence alone established —
that petitioner had suffered damage as a result of* the
illegal termination of its dealer contract ial B, infra,
p. A29).

Proof of the amount of post-termination damages was
substantially based on the testimony and estimate of Fon-

tana’s officer that with its normal 10% customer discount
\ :

14

(substantially more than that allowed by Hartzog's dealer
company) it would have sold various models of new Beech
planes to seventeen identified prospects who had asiied
Fontana for price quotations. As to these prospects the
court below observed, ‘‘there was supportive evidence that
all of the prospects already owned planes and that they had
business needs for executive aircraft as well as having
seme business connection in the Tron Mountain, Michigan
region. Fontana had previously sold planes to and done”
service work for some of the prospects and a number of —
the prospeyts subsequently did purchase sircraft"’ (App.
RB, infra, p. A27).

Fontana’s officer further testified that Fontana would
have realized a profit of 10% on these sales if completed ;
that other than minimal selling and demonstration expenses
no additional expenses. (over and above existing overhead
burden) would be ineurred in making these sales; and that
even these few expenses would he paid for out of charter
revenues earned on the demonstrator aircraft.

The total claimed lost profits or damages on these sales
wits $209,800.
Regarding the competency and weight to be given to this
testimony, counsel for Beech said (A. 716) : E
+ could certainty have uo objection to the witness
testifying, if. you*had sold prospect A, whom you had
. named, at such and such a price, what would your profit
have heen: .. . The evidence as to their status is in the
record. I suggest that how many of them he would

ae SS eee aa oe among other
things, the jury here to determine . .

The court below, while characterizing the damage esti-
_ mate as *‘weak’’, held that the estimate was competent
evi and secaguiand that the fact that petitioner had
heen ‘ating under the conspiracy restraints and was
terminated just as the corporate airplane market was de-

15

veloping ‘‘did not present the usual situatian’’ so as to
petan: a before and after earnings comparispn. Further
the court said the matter of the weight to be given to the
damage textimony was for che juty and observed ‘‘the jury
- may well not have accepted the Fontand witness’ assertion
ax to some of the alleged prospects and may have reduced
the damage award accordingly. Apparently this is what

happened, for the jury award is substantially less than the
amount plaintiff asserted as its dasmages’’ (App. B, infra,

p. A320):

c ‘ourt in n rejecting the post-termination damage proofs.

First, the District Court had held that & a matter of

Second, the District Court had held: that while there was
evidence that plaintiff would be at a competitive disadvan-
tage in attempting to sell new Beech aircraft as an ‘‘un-
authorized’’ dealer, it had not ‘‘specifically demonstrated’

- ee

16

that this was true in the case of the 17 prospects mentioned
(App. B, infra, p. All). Concerning this ruling the court
below said (App. B, infra, p. A29):

‘*As to the contention by Hartzog and Beech that
plaintiff could have obtained new Beech aircraft from
Beech distributors even without. an authorized dealer
status, problems existed. Beech’s Vice President tacitly
admitted that this theoretical possibility was not a
practical solution when he testified to the many teeb-
nical services that are available only to authorized
Beech dealers and conceded that unauthorized dealers
would be at a competitive disadvantage.

Further there was evidence that the plaintiff did
attempt to compete in this manner on at least two
separate occasions but unsuccessfully so, Fontana was
not bound to make repeatec requests for airplanes from
Beech distributors or to exhaust every possible avenue
to avoid the effects of defendant's alleged illegal ac-
tivity but could maintain an action for an injury
which flows naturally and expectedly from such ac-
tivity. Zenith supra at p. 114 n. 9; Continental Ore Co,
v. Union Carbide & Carbon _ 370 U. 8. 690, 696-
702 (1962).’’

Third, the District Court, while crediting: the damage
testimony, had held that petitioner had a duty to present
the ‘‘best available evidence’’ and thus was required to
depose or call at the trial each of the 17 prospects to estab-
lish through their testimony that they would have purchased
from Fontana had Fontana been a dealer (App. B, infra,
p. Al2). Concerning this ruling, the court below held that
petitioner was not required to depose or call each of the
prospects and its failure to do so went only to the weight
of the evidence and not its competency. The court pointed
out that petitioner’s failure to call the prospects ‘‘ undoubt-
edly weakened plaintiff’s case’’, but that the jury had
apparently taken this factor into account in fixing the
damage award (App. B, infra, p. A30).

a

17

The Court of Appeals coneluded by stating, ‘‘what we
have said is sufficient to indicate the error of the trial court
in finding that the evidence on the fact of damage issue was
overwhelming and conclusively against Fontana. Once
there was sufficient evidence of the fact of damage to go to
the jury, the assessment of the amount is largely a matter
of the jury’s consideration of all the evidence. Bigelow v:
RKO Radio Pictures, 327 U, 8. 251, 264 (1946)’’ (App. B,
infra, pp. A30-A31),

The conditional grant of the new trial was based on the
same ground as the grant of judgment N. O. V., to wit: that
petitioner had failed to prove the fact of damage. The trial
judge mentioned no additional grounds for the new trial
order, Indeed, there is no separate discussion of the new
trial motion at all, The District Court's opinion is devoted
entirely to a discussion of the N. O, V. motion and the legal
reasons assigned for rejecting the damage proofs. In a
formal one sentence compliance with Rule 50(c), the trial
judge, after granting defendants’ motion for judgment
N. O. V., added, ‘‘défendants’ motion for a new trial is
conditionally granted, should this judgment be vacated or
reversed, Rule 50(¢), Fed. RB. Civ, P.’’ (App. B, infra, p.
Al15). The accompanying judgment order merely recites:
‘‘If the aforesaid judgment be vacated or reversed, then
defendants’ motion for a new trial is granted on the
grounds set forth.in the Court’s memorandum opinion"
(A. 65).

It is thus apparent from the fece of the order that in
granting the new trial the court relied on the same grounds
assigned in rejecting the damage proofs and deciding the
N. O. V. motion—grourds which the opinion of the court
below expressly holds to be erroneous as a matter of law
and factually disproven by the record evidence,

Pye FO éShETC

SR pee,

1s

Further, in their brief in the court below, defendants
conceded that the grant of a new trial was solely on the
fact of damage issue and that the District Court did not
purport to hold that ‘defendants should receive a new
trial beeause ... the amount of the verdict was against the
clear weight of the evidence or was such that a miscarriage
of justice would result if it was permitted to stand” (Br.
p. 3)..

Nevertheless, the court below refused to disturb the new
trial order stating, ‘‘since the court in its discretion was
satisfied in the event the judgment notwithstanding the
verdict was not upheld that an adequate basis for a new
trial existed, at least on the question of damages, we will
not disturb that exercise of his diseretion’’ (App. B., infra,
p. A31). In this connection the court apparently misread
this Court's opinion in Zenith Radio Corporation v, Hazel-
tine Research Inc., 395 U.S. 100, 123 (1969) and concluded
that the same deference must be given the trial judge’s
ruling on a new trial motion in a jury case, even though
based on a mixtake of law ax to the legal sufficiency of the
evidence, a» that accorded findings of the trial judge in a
non-jury case (App. B, infra, p. A26).

The court reaches the conclusion that the new trial order
should not be disturbed notwithstanding its own earlier
determinations that the fact of damage was ‘‘implicit’’ in
the violation shown; that the undisputed evidence estab-
. lished that petitioner could not successfully compete as an
‘*unauthorized’’ dealer; that the damage proofs more than
supported the jury’s verdict; and that once the fact of
damage is shown ‘‘the assessment of the amount is largely
a matter of the jury's consideration of all the evidence.”’

19

REASONS FOR GRANTING THE WRIT.
L ra)

The deeision of the Court of Appeals in permitting a
second trial of the damage issues notwithstanding its hold-
ing that the jury’s determination of the cause of injury and
of its amount was supported by competent and legally
xufficient evidence direetly conflicts with the decisions of
this Court in Eastman Kodak Co, v, Southern Photo Ma-
terials Co,, 273 U, 8. 359, 379 (1927), Bigelow v. RKO Radio
Pictures, 327 ', 8, 251, 254-5 (1946), Continental Ore Co. v.
Union Carbide Corp., 370 U. 8. 690, 700-1 (1962) and
Perkins v, Standard Oil Co,, 395 U. 8.-642, 648 (1969).

Petitioner proved a per se violation of the antitrust laws |
and loss of its Beech dealership as a direct consequence —
thereof, As the court below observed, the claimed damage
and injury ‘‘flows naturally and expectedly’’ from defend-
unts’ illegal activity in depriving plaintiff of his authorized
dealer status, The court held that the damage estimate of
lost sales and profits was competent evidence and the weight
to be given it was for the jury.

The court below noted that even the trial judge reeog-
nized that the damage testimony was competent, -stating,
‘‘(T |here is no indication in the record that the court
struck the testimony as being speculative or conjectural or
that the entry of the. judgment N, O, V. was based upon
this premise, The trial judge’s memorandum opinion spe-
cifically stated that it was without regard to issues of
eredibility’’ (App. B, infra, p. A28).

The jury was instructed that it could not award specula-
tive damages, that there had to be some reasonable basis in

the evidence.for the damages awarded (A, 1255) and that it
could consider Joseph M. Fontana’s testimony only if satis-

20

fied it was based on facts which saneneey supported it
(A. 1256).

~ The jury's verdict of $150,000 was not excessive. The
damage proofs would have supported a verdict substan-
tially i in excess of this amount, And the reasonableness of
the verdict reached is indieated by the fact that the trial
judge predicted to counsel that the jury would return a
verdict in this exact amount. 7

There is no suggestion either in the opinion of the court
below or of the District Court that anything occurred dur-
ing the trial which may have resulted in the jury receiving
a distorted, incorrect or incomplete view of the operative
facts. The new trial order was not granted on the ground
that evidence was improperly admitted or rejected, error in
instructions, prejudicial statements or any other ground
allegedly constituting prejudicial error,

The sole ground for the new trial order was that peti-
tioner failed to prove the essential fact of damage. In
reversing, the court below held that not only was there
substantial evidence of the fact of damage but also that
the fact of damage was ‘‘implicit’’ in the violations proven.

Aw this Court has repeatedly held, and even the court
helow acknowledges, once the faci of damage is shown the
- question of amount is for the jury to determine upon con-

sideration of all the evidence, Where there is competent
‘evidence as to the amount of damages and the damage
proofs more than support the jury award and the jury has
heen properly instructed as to the standards to be applied
in determining damages, as here, the jury's determination
is conelusive,

In Eastman Kodak this Court, in affirming the damage
award, held ‘‘the jury was instructed, in effect, that the
amount of damages could not be determined by mere specu-
lation or guess, but must be based on evidence furnishing

21

data from which the amount of probable loss could be
ascertained as a matter of reasonable inference. And the
question of amount of the plaintiff's damages having been
properly submitted to the jury, its determination as to this
matter is conclusive’’ (273 U. 8. at 379).

Similarly in Bigelow this Court said, ‘(T]he jury may
make a just and reasonable estimate of the damage based
on relevant data and render its verdict accordingly .. .
[T |he wrongdoer may not object to the plaintiff’s reason-
uble estimate of the cause of imjury and of its amount

supported by the evidence because not based on more .

accurate data whieh the wrongdoer’s misconduct has ren-
dered unavailable ,. .’’ (327 U. 8, 251, 254-5).

In Perkins, this Court again reiterated, ‘‘[{I]f there is
nufficient evidence in the record to support an inference of
causation, the ultimate conclusion as to what the evidence
proves in for the jury’’ (395 U. 8S, 642 at 648).

See also concurring and dissenting opinion of Mr. Justice

Black in Simpson v, Union Oil Company, 396 U. 8. 13, 17
(1969), ,
In the face of these Pare and its own holding that
onee the fact of damage is shown ‘‘the assessment of the
amount is largely a matter of the jury’s consideration of
_all the evidenee’’ (App. B, infra, pp. A30-A31), the court
helow nevertheless sanctioned the District Court’s usurpa-
tion of the jury’s prime function as the trier of fact by
refusing to reverse the new trial award on the damage
insues,

II,

The anomalous decision of the court below in refusing to
reverse the new trial order based on the same mistake of
law as the grant of judgment N, O. V., which was reversed,
xo far departs from the accepted and usual course of judi-
cial proceedings as to call for an exercise of this Court's
power of supervision. |

Eyre

22

It is fundamental that when a new trial is granted on
mistaken legal groumls, as opposed to dincretionary
grounds, no question of abuse of discretion in involved and
it in only necessary to demonstrate that the legal grounds
assigned are erroneous. If the legal grounds relied upon
by the trial judge are erroneous, as the court below has
held, the new trial order must be reversed as a matter of
law. See Fairmount Glass Works v. Cub Fork Coal Co.,
287 U.S. 474 (1933); Finn v. American Fire d& Casually
Co. 207 F.2d 113 (Sth Cir, 1953); 6A Moore's Fed, Prae.
| LDS] pp. 3903-4.

It is apparent from evenoa cursory reading of the Dis
triet Court’s opinion that the legal grounds assigned are
erroneous and that the court misapprehended ‘the burden
of proof which may be demanded of a treble damage plain.
tiff who seeks recovery for injuries from a partial or total
eseclusion froma market’? Cl UL 8. 123). The court was
of the opinion that petitioner could only prove damages
in one of the following ways: (1) pre conspiracy earnings
experience (before and after comparison); (2) earnings
experience of a comparable but unrestrained enterprise
during the conspiracy period; and (3) expert opinion
based on either (1) or (2). See App. B, infra, p. A12.

The District Court held that Fontana's testimeny as to
lost sales and profits did not satisfy these eriterin because
not based on either ‘historical or comparative data’’ and
further that petitioner was required to produce ‘‘the best
available evidenee’’ in proof of its claimed damages, Thix
required either deposing or calling at the trial each of the:
prospects to establish through their testimony their status
as prospects and willingness to buy.

The court below in reversing held that ‘‘while proof of
loss by the particular method adopted by Fontana doex
not meet the ordinary standards .. . the circumstances
of plaintiff's business and developing corporate airplane

2:5

market did not present the usual situation.’’ The court
held that the damage testimony was competent (see e.g.
A.C. Bechen Co. vy. Gomes Corporation, 272 ¥. 2d 1, 5
(7th Cir, 1959); William HW. Rankin Co. v. Associated
Mill Posters, 42 0. 2d V2, 155 (2d Cir., 1930)) and further
that petitioner was not required to call the prospects as
Wilnennen, stating that the fact it did not went only to the
weight of the damage proof,

The court below also reversed on legal grounds the Din.
trict Court's holding that petitioner could not recover
damages with respect to those prospects who came to
petitioner after filing of the complaint, holding that pe-
litioner’s inability to compete for this business wax due to
the single vet of defendants, occurring before the filing
of the complaint, in depriving plaintiff of his authorized
dealer sfatus.’’ On the basis of this error of law alone
the Distriet Court had held petitioner’s damage claim
should be reduced by $80,300.00,

Finally, the court below rejects as contrary to the evi
dence and legally erroneous the Distriet Court's conten
lion that petitioner could have operated as well without a
dealer contract and could have successfully competed by

purchasing airplanes from other Beech distributors. The

court said that there were problems whieh rendered this
‘theoretical possibility’? not a “practical solution’’ and
that petitioner had attempted ‘to compete in this manner
on at least two separate occasions but unsuccessfully so,"’
The court added that%petitioner was under no legal duty
‘*to exhaust every possible avenue to avoid the effects of
defendants’ alleged illegal activity, but could maintain an
action for an injury which flows naturally and expectedly
from such activity’’, citing this Court's opinions in Ze-
nith (395 U.S. 100, 114) and Continental Ore (370 T.. S.
690, 696-702).

5

PORE I! HAF MN RRM NE ly

he WOR a Sake dee wa

eB Bas

24

Thus, as appears from the opinion of the Court of Ap-
peals, each of the grounds relied on by the Distriet Court
in rejecting the damage proofs and entering judgment
N.O. V. was@rroneous as a matter of law. Since the new
trial order was based on these same grounds, the new trial
order manne aid should have been reversed as well.

The decision of the court below in refusing to dixturb the
new trial order requires petitioner to begin all over again
before a second jury, notwithstanding that there was sub-
stantial evidence to support the jury's finding and deter
mination with respect to the liability and damage issues,
and that nothing occurred during the course of the trial
which may have prevented the jury from reaching a fair -
verdict.

These circumstances, we submit, warrant the exercise of
this Court's supervisory power with respect to conduct
of jury trials in private antitrust actions,

There ix a growing temlency by the lower courts to pay
lip service’ to the antitrust decisions of this Court but
nevertheless deny effeetive relief to plaintiffs in treble
damage actions by sending the case back for a second

and unnecessary trial, See e.g,, Zenith Radio Corporation

v. Hazeltine Research, Inc,, 418 F. 2d 21 (7th Cir. 1969) ;
Utah Pie Company v. Continental Baking Company, 396
F. 2d 16] (10th Cir. 1968); Florist’s Nalionwide Tel, Del.
Net, v. Florist Tel. Del. Ass'n., 371 F. 2d 263. (7th Cir.
1967); Cf. Simpson v, Union Oil Company, 396 U. 8. 13
(1969), dissenting opinion Mr, Justice Black.

Requiring a second and unnecessary trial not only places
an intolerable burden on petitioner (who has been without
a dealership for almost five years) but is the kind of dis-

- position which threatens to’ seriously weaken effective

enforcement of the antitrust laws by private actions.

“=

25 |
“This Court j is well’ aware of the large expense involved
in antitrust litigation. The instant trial took five weeks.

Few litigants can afford the — of one five-week
trial, let alone two,

If an antitrust plaintiff must try and win his case twice
in circumstances like these, the protection of the antitrust
laws will be available only to the corporate giants and the
effectiveness, of private enforcement, the importance of
which this Court has repeatedly recognized, will depend

on the relative length of the litigant’s purse strings.
‘

CONCLUSION.
For the reasons given this Petition for a» Writ of Certi-
* orari should be granted.

> Respectfully submitted,

Francis J. McConweia,
Joun Borst, Ju.,
Ricnarp P, Camppen..
Attorneys for Petitioner,
Fontana Aviation, Inc,”

Of Counsel: ‘

McConxets, Cuirris, Manon & Borst,
134 South La Salle Street,
.Chieago, Ilinois 60603
RAndolph 6-9131

b

Al

APPENDIX A.

The statutory and rule provisions involved are:

Section Lof the Sherman Act, 15 U.S. C. 81, providing
in pertinent part: ‘

**Kivery 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, ix declared to be egal: ...”’

Section 4 of the Clayton Act, 15 U.S. ©. § 15, providing:

“Any person who shall be injured in his business
or property by reason of anything forbidden in the
antitrust laws may sue therefor in any district court
of the United States in the distriet in which the de-
fondant resides or is found or has an agent, without
respect tothe amount in controversy, and shall recover
threefold the damages by him sustained, and the cost of

— auit, ineluding a reasonable attorney’s fee.’’

Rule S20b) of the Federal Rules of Civil Poccedere pro-
Viding in pertinent part:

‘... Not later than 10 days after entry of judgment,
a party who has moved for a directed verdict may move
to have the verdict and any judgment entered thereon
set aside and to have judgment entered in accordance
with his motion. for a directed verdict. ... A motion
for a new trial may be joined with his ‘motion, or a
new trial may be prayed for in the alternative. If a
verdict was returned the court may allow the judg-
ment to stand or may reopen the judgment and either
order a new trial or direct the entry of judgment as
if the requested verdict had been directed. .

Bf ete e ra

Tne Ra «ae ee

A2

Rule 52(¢) of the Federal Rules of Civil Procedure pro-
viding in pertinent part: |

(1) If the motion for judgment notwithstanding
the verdict, provided for in subdivision (b) of this
rule, is granted, the court shall also rule on the motion
for a new trial, if any, by determining whether it
should be granted if the judgment is thereafter vacated
or reversed, and shall specify the grounds for granting
or denying the motion for the new trial, If the motion
for a new trial is thus conditionally granted, the order
thereon does not affect the finality of the judgment,
In case the motion for a new trial has been condi-
tionally granted and the judgment is reversed on ap-
peal, the new trial shall proceed unless the appellate
court has otherwise ordered, ...’’

A3

APPENDIX B. :

In roe Unive States Court or APPEALS
or the Seventh Cireuit,

— —=- ———)

Nos, 17,784 and 17,73,

Monvana Aviation, Ine. a Corporation,
Plaintif{-Appellant,
v8,

Benen Amenarr Convonation, a Corporation, and Hartzou-
Scuxeck Aviation, Ine,, a Corporation,
Defendants-Appellees,

MEMORANDUM OPINION OF DISTRICT COURT,

eee

(Filed Mareh 7, 1969,)

Croxs Motions for Judgment Notwithstanding the Ver-
diets,

Plaintiff, Montana Aviation, Ine, (Fontana), began this
civil antitrust action on May 16, 1966, seeking a treble
damage award and injunctive relief, The first count of
its two count complaint alleged a combination and con-
spiracy in violation of section 1 of the Sherman Act,
HU. S.C. 1, between defendant Beech Aireraft Cor-
poration (Beech), Hartzog-Schneck Aviation, Tne, (Hart-
zo), and certain unnamed co-conspirators, Count TT was
directed against Hartzog and the co-conspirators, charg-
ing them with a combination and conspiraey in violation
of section 1 of the Sherman Act, 15 U. 8, (. 1, Sections

Ad

4and 16 of the Clayton Aet, 1 U8. 01, seen, 1 and 26,
provide for money awards and injunctive relief respec
tively. After a lengthy trial, a jury returned a verdict
in faver of Fontana on count Tan nwardedd Montana
damages to the extent of B1OQ,0000 ‘The jury also re
tured a verdict in faver of Hartveg and against Montana

on defendant’s counterclaim and assessed damages at
$5,000),

Pursuant te Rule OO) (bh), defendant Boeeh Aireraft
Corporation has moved to set aside the verdiet of the
jury with respeet to Count boef the Complaint and: the
judgment entered thereon, and te enter judgment) for
defendants in accordance with the motion for a directed
verdiet as te Count PE tiled by defendants Beech and
Hartzoy at the close of all the evidence. The grounds
for this motion are (a) that exseept as to the matter of
infringements’ there is ne evidenee of record upon whieh
a jury could propertly have found a violation of the anti
trust laws by defendants, and Cb) that plaintil altogether
failed te establish the injury er “impaet’’ from oan anti
trust vielation, or to shew the damages inca measurable
amount, indispensable fo sustaining a private cause of
vetion under the antitrust hows. Bither of these erounds
would independently justify the granting of Beeeh's motion,

Defendant has also moved, pursnant to Rule oO of the
Federal Rules, for a new trink This motion is alternative
to Reech's motion for judgement notwithstanding the ver
diet. Beech prays that if the nooo. v. motion is denied,
the new trial motion be granted, and that if the na. v.
motion is granted the new trial motion be conditionally
eranted in aeeordanee with Rule 50 (e) of the Federal
Rules of Civil Procedure.

The leeal test as to the suMcienev of the evidence on
a motion for indement n. o. v. is the same as that ona
directed verdict motion. Wieloch v, Rogers Cartage Co,,

a
o-

A5

2OO W, Bb 28h, 237 (7th Cir, 1961). In treble damage suits
under the antitrust laws as with other types of actions,
the trial court is:

‘hound to view the evidence in the light most favor-
nble to (the party against whom the motion is made)
and to give it the benefit of all inferences: which the
evidence fairly supports, even though contrary in-
ferences might reasonably be drawn,’”
Continental Ore Co, vy, Union Carbide & Carbon
Corp, 8700S. 690, 696° (1962),

Having so viewed the evidence, however, there in still
nome confusion ax to the amount of evidence which is
required fo xupporta jury verdict, There has developed
‘on great variety of verbal formulations, couched in-gen-
eralities which are not readily applied to a particular set
of facets.’ 2B Barron & Holtzoff, Federal Practice and
Procedure, § 1075, af 300 (1961). The confusion has arisen
in part from linguistic difieulties and in part from con:
coptual uncertainties, Comment, Directed Verdiets and
the Right to Trial by Jury in Federal Courts, 42 Texas 1,
Rev, 10538, 1060 (1964),

In our opinion, the best judicial analysis of the stand-
ards whieh are and should be applied in) determining
whether fo enter judgment n. o. v. is found in Pedrick v,
Peoria & Rastern Railroad Co,, 37 MW, 2d 494 (1967), That
decision rejects the notion that the presence of any or a
seintilla of evidence ix sufficient to sustain a jury verdict,
Td, at 510, We agree, for literally that would prohibit
overturning a jury verdict where the overwhelming weight
of the evidence ix against the verdict, The Illinois Supreme
Court also rejected the notion that if reasonable men could
ever differ on the evidence presented, then the jury verdict
must stand, Cf. 7d, Again we agree, Under this rule, ‘there
in at least a surface incongruity’’ in a trial judge saying

At

reasonable men could never differ when a jury just decided
the innue ofherwine, ‘Mhun, a judge could never property
enter a juelyment oo. v. unten he could say Chat the jury
wis Comprised of unreasonable men,

To our minds, the better rule in one whieh permite the
entry of a judgment na. ov. dn those emsen where all the
eViddenee, taken as a whole and viewed mont favernbly to
thier copeprerment af the mietion, ds se eonelusively ar over
Whelminely on faverof the movant that ne contrary verde
vould or should stand. Gutiege vo Unton Pactic Railroad
Co RP Pre bbe Cc both Cie, MOO): Carroll. Seaboard
Aer Dane Batlroad Can, SFP ab OO, Oe Cath Cie, Paz);
Pedr h vo Poona Raster Rathoad Co. SF A web aM,
EO CPT et. Greene vo Waren, U7 1 tab Ea, U7 Osth
Cur GO) OP course this rule is alse a eeneralization and
lacks certainty, but we believe That it focuses: attention on
the veabissue the suffictoney of the evidenee more een
rately Chan ako the other appranehes,

ir tush, then, is fo determine wliether the overwhelm
ma ce tideonce tn this case is against the pura’s cendict (hart
Montana was iijured the extent of 810,000 by certain ae
tions of the defendants whieh were in violation of the
antitrust laws. As we lave stated previously, defendants
would be entitled to judwment moa. vw. Uf they were net
wuilty of any antitrust violations or, even if guilty of sueh
Violations, no real damages were attributable to their legal
vetions, Defendants acknowledge that their pre l66 ter
ritorial infringement system constituted an antitrust: ¢ie-
lation, but they vieorously deny that they are guilty of any
other antitrust violation charged by the plaintiff. After
the trial had ended, the Supreme Court decided United
Ntoftesv Container Corporation of America, U.S, -
(Jannary 14, 1969), Regarding the exchange of price in-
formation, that decision adopts a very expansive notion of
what constitutes an antitrust violation, Tn this opinion, -

A7

we will ansume, but not decide, that defendants are muilty
of antitrust violations, We do so beeause we believe that
An analyxiK Of the proof offered with rexpeet to the damage
ineusred in wufliciont to dispose of the motion for judgment
no V,

Plaintitt claimed the following damages :

(n) $1,000 on aceount of an infringement payment made
boy it in TEMG,

(bh) $11,970.50 with redpeet to the sale of a Baron to
Inland Steel in 164 on whieh it elaimed that but for the
conspirney if would have received a $25,14F dixeount but
netually: received an $11,570.50 dixeount (Tr, V1).

(¢) $40,024 with respect toa Kingnir sale to Inland Steel
in 100 an to whieh it elaimed that it would have reeeived a
20% discount but for the conspiracy, but in fact reeeived
$12,500 (Mr, 1256),

(dl) $7,865 with respeet toa Travelair sale to Cable Con.
Mfruetors in 166 ax to whieh it elaimed that but for the
conspiracy it would have received a $14,740 diseount but in
Faet received a $7,465 discount (Tr, 1197),

(+) $200,800 with respect to seventeen airplanes that it
would have allegedly sold to seventeen prosxpeets during
the period sinee its termination, breken down to (MeCon-
nell Closing Tr, 58);

$45,000 on two Kingairs
$44,000 on two Queenairs
$34,000 on four Barons
$32,500 on five Travelairs
$12,600 on three Bonanzas
$ 1,700 on one Musketeer

It is obvious that the jury did not feel that the plaintiffs
proved all of their damage claims, because the\ jury
awarded only a little more than half of what was requested.

oo a

A#

Moreover, we have not a little difieully in trying to deter
mine which proofs of damages the jury did believe boeaune
we cannot arrive at a combination of damage elements
which totals the jury award, Consequently, we must look
mt emeh item,

Defendants deo not chatlenge the jury's conclusion that
the territorial infringement system as it existed prior to
14} violuted section foof the Sherman Aet, Nor ce they
content that plamtil made a payment of $1,000 on account
of the provisions of the ayastem, What defendants contend
in that the jury, on ite verdiet for Tartzog on the latter's
counterclaim, found that plainti? actually benefited to the
extent of $5,000 from the system. Fontana reasonably
suggests that defendants cannot have it both ways, that in,
connet recover a counterclaim judgment and also use the
$5,000 payinent asia set off. Hartzog, however, has indi
ented it will waive the counterclaim verdiet, Moreover, this
Income aspect of the damage claim as to whieh the jury ean
be stich to have made a specific determination, 1 has held
that plaintif® did benefit to the extent of $5,000 from the
fofringement system. We tind no overwhelming evidence to
refute that verdict, Consequently, viewing the evidence as
a whole, it cannot be said that Fontana was injured by the
infringement system to the extent of $1,000 or even at all,

The second claim of damages was for $11,570.50 of whieh
plaintitY was allegedly deprived when it) received only a
lor discount, not the regular 200% slixeount on the sale of
a Baron airplane to Inland Steel in 1964, Yet, on cross-
examination, plaintiff's president testified that he received

23,000 or cash equivalent to a 20% diseount for the Baron
amy (Tr. 781). In an answer to one of Hartzog’s interroga-
tories in another case, plaintiff clearly stated that Hartzog
paid €23,141 or 20% of the $115,705 Hat sales price to
Fontana due to the latter's sale of a Baron model plane to

Inland Steel (DX 37). There is no reason to discuss other

AY

fawn in plaintill’s claim of damages arining from the Baron
wale in view of thene conclusive adminnionn by plaintiff that
i netually received full payment for dhe sale,

Minintills also claimed damages of approximately $49,524
on the sale of a Kingair plane to Inland Steel, The amount
Of damages in the difference between the $12,500 commin
non allowed by Hartvoy and a 20% dincount off the lint
price to whieh plaintiff believes it wax entitled, Plaintiff's
theory in that (ijn an open market and absent the eon-
npiracy plaintiff’ woul have been entitled to parity of
treatment with Hartyvog'’s dealer company’ (Plaintiff's
Iriel, wt 41). Yet, there in no evidence to support thin
contention that Hartzog would have allowed phiintiff more
Favorable treatment Vian it was already wetting. Not only
did plaintiff's president testify that Hartsoyg never indi.

ented that it would like to give plaintiff a 20% dixeount on

the Kingair (Tr, 1247), he admitted that Hartzoy ‘ob.
viewnly didn’t want to’? give plaintiff such a discount (Tr.
Pd, ef. Woo). Further, inasmuchas Hartzoyg wax the only
Beoeh lint Fibutor to allow $12,500 on a Kingair commission
(DX 47a-Gin), it iq virtually impossible to infer that plain-
HiT would have been allowed any greater discount in the
absence of Beeeh’s interference,

Minally, plaintiff Aitroduced no evidence that in 1965 it
had the financial capacity to purchase and maintain a
demonstrator so that would qualify for a 20% discount if
one were offered, Plaintiff's president admitted that the
Kirst National Bank of Iron Mountain in Michigan said
that plaintiff's credit wax worthless (Tr. 644). Nor was
plaintiff's financial position moré strong in 1965 (DX 34),
Yet, a down payment on a demonstrator would require
$44,750 (R. 1731), a sum too great for Fontana to meet.

Similarly, we do not believe that plaintiff proved that it
suffered any damages with respect.to Cable Constructors’

Te RSS RIOTS

RAAT DME, marae

rs RY AE eee “2

Ato.

Travelair, Plaintiff's president indicated that in the ab-
sence of deféndants’ interference plaintiff? would not have
received better terms because Hartzog did not want to give
plaintif® the desired 20% diseount (Tr, 1455). - Moreover,

the reason that Hartzog refused to grant the 209% discount

was that plaintifl did not mamtain a-suitable demonstrator,
PlaintitY testified at one point that it could have maintained
such a demonstrator at no net cost (Tr, 1433-35). Uf this is
so, then as defendants suggest, plaintiff had a duty to miti-
gateites supposed damages by maintaining a demonstrator,

merican Can Go, v, Russellville Canning Co;, 191K. 2d 38,
O49 (Sth Cir, 1951), Plaintiffs have not explained why this
was not done with regard to the Inland Baron sale or the
Cable Constructors Travelair sale,

The tinal category of damages to be considered are those
which allegedly acerued because Montana's dealer contract
was cancelled. Plaintiff claims that but for this termination,
it would have sold airplanes to seventeen identified pros-
pects and profited to the extent of $209,800, The prospects
broken down by category of plane were as follows: Kingair
(Cleveland Clitfs; Gus K. Neuberg); Queenair (Kimberly
Clark; W. B. Thompson) ; Baron (Anderson, Patz, M. 'T. U.,
MeGibben); Travelair (Hovie, Rosseau, Ahoanen, Saun-
ders, Hocking); Bonanza (Lynn, Nelson, Kdwards); Mus-
keteer (Kichoff), According to plaintiff, all of the prospects
already owned a plane and had a business need for an |
executive aircraft as well as some business connection in the
Iron Mountain, Michigan, region where plaintiff was lo-
cated. Further, Fontana had previously sold planes to and
done service work for sonie of the prospects, Finally, we
understand aon of these prospects subsequently
purchased ireraft. Thus, plaintiff contends, the fact of

damage ix self-evident.

Pe ans first place, we instructed the jury that plaintiff is
t

permitted to recover damages in this suit on account of

All
any injury caused by any continuation of the alleged con-
xpiracy or the performance of any acts after May, 1966,
When this suit was commenced (Instructions, p. 4%). Lawlor
Vv. Loewe, 285 US. 522, 5386 (1915); A. CL. Becken Co, v.
Cemex Corp, 314 F.2d 839, $43 (7th Cir. 1963); Flintkote

Co. v. Lysfjord, 246 F.2d 368, 394-96 (9th Cir, 1957). We

note that the time between ‘contract termination and the
institution of this action ix very short. Plaintiff has pot
offered any specific evidence that post-termination impact
was felt prior to May, 1966. The best evidence which we
can glean from the record indicates that about half of
plaintiff's alleged prospects (Nelson, MeGibben, Saunders,
Anderson, Lynn, Kichoff, Cleveland, and Block) became
prospects only a relatively short time before trial in 1968 or
in 1967 (Tr. DIS 23, 1927, 1129-381, 1133, 1136-38, 1181,
1265). At least as to these parties, no damages acerued
prior to the institution of this aetion. This alone would
diminish plaintiff's danige claim by approximately $80,300.

Secondly, plaintiff never claimed that any conspiracy
between defendants was aimed at depriving it from obtain-
ing aircraft to sell, but only that there was a conspiracy to
deny authorized status to Fontana (Tr, 857-58). Yet aside
from the general position taken by plaintiff that its status
ax an unauthorized Beecheraft dealer was competitively
‘disadvantageous, plaintiff has not specifically demonstrated
the relevance between such status and the loss of seventeen
potential sales, What plaintiff did claim was that if it eould
have made a bid, then it had an excellent chance of making
a sale (Tr, 322). However, plaintiff admitted that it never
took advantage of a specific offer from at least one Beech
distributor, Aviation Distributors, Inc., based in Pontiac,
Michigan, to sell aircraft to it so that it could make its bids
(Tr. 1322-23). ‘

Thus, we do not agree with plaintiff that the fact of
damage in the relevant post-cancellation period is self-

adie dae
ft

Ee Se ee ee,

Alz

evident, ‘The existence of the injary must be demonstrated
with reasonable certainty, not supported just by xpecula
therne canned = goon Bigelow Vv. RKO Radio Pictures, lne.,
B27 US. Bol, 264 (PMG); Flinthote Co. vy. Lysfjord, 246

yk Sos, 02 (Oth Cir. 1957), cert, denied, 8h US. BD
(17), OF course, once the “causal connection between
defendant's wrongful act and some los of anticipated
revenue!’ in extablinhed, then the jury tay make a reason
able estimate of the damages based-cn all relevant date and
“inferences, Id, However, ofr discussion in.coneernead not
with the reasonableness of the jury's caleulations, but with
the fact, that they thought an injury had been proved,

Reasonable certainty requires that the plaintitt meet its
burden of “furnishing the best available evidence that
the subject matter permits, as to what the impact of Ahe
elainied egal conduet was on its business.’ iiss a Co.
v. Assectation of American Railroads, WO. Supp. 10,
CD. CL 1960), Tn eases claiming loss of profits, three
main types of evidence may be introduced: plaintiff's pre-
conspiracy own records of business, records of comparative
but unrestrained enterprises during the relevant period,
and expert opinion as to these records, — F'lintkole vy.
Lusfierd, 246 BF. 2d 868, 892 (9th © ir, 1997), cert. denied,
855 U.S. 885 (1957) ef. Roseland v. Pluster Mfg. Co., V25
FE. 2d 417, 420 (7th Cir, 1942).

WaintitY did not present evidence based on its or a com
petitors business records, Rather, it contends that Joseph
M. Fontana's estimate of lost sales and profits with regard
to the seventeen named prospects was competent proof,
similar to that approved in A. C. Becken Co, ¥. Gemer |
Corp., 272 F. 24.1, 5 (7th Cir, 1959) and William IH, Rankin

Cy. v, Associated Bill Posters, 42 F. 2d 152, 155 (2d Cir.
19230). In the latter case, however, plaintiff presented
testimony as to pre-conspiracy profits. Its estimate of its
lost profits ‘‘was proof of a kind as definite and certain

Al3

as the subject matter admitted.’’ 42 F.2d at 155. In the
former case, plaintiff's estimate, which was supported by
actual salen and profit data, wax also considered to be the
bent available, 272 i. 2d. | , |

That plaintiff did not present such historical Or com
parative date in not surprising when one considers that
during 163-1965, Fontana sold only two airplanes to
only one customer (DX 37) and, at the end of 1965, had
w retained earnings defieit of $52,471.62 (19X 34). Further,

defendant’ Hartzoy, whieh operated ino an nnfettered and.

open market, actually lost money since it began doing

business if 1961 and specifically during the period from

Januery, 1966, to June 1968 (Tr, 441-2). Plaintiff iv
undoubtedly correet inowaying that the corporate aircraft

. . . y
market did not fully develop until after ite-dealer con.

tract was cancelled, Yet, this just means that appropriate
evidence of business trends should have been introduced
ux well, In any case, a change in the business climate
does notvexcuse plaintiffs from presenting evidence of the
business experience of another plane dealer nor does it
explain how Fontana would have profited in this area

when Hartzog, which averaged five sales a month, was-

operating at a loss,

Finally, in contrast to those cases where estimates and
projections of business trends in- the areas of sales or
production are the best evidence available, plaintiff could

have presented quite specific information concerning each —

of the seventeen potential sales for which it claims dam-
ages. Plaintiff could have deposed or called each prospect.
Now plaintiff suggests that defendant could and should
have interviewed. or called these persons as well, but it
was plaintiff and not the defendant which had the duty
to prove its case. Further, and contrary to plaintiff’s sug-
gestion, it Was in no way precluded by any of the defend-
ants actions from showing with particularity that it stood

et ee

Al4

a chance of successfully dealing with some or all of the
seventeen prospects, ‘The failure of plaintill to introduce
the testimony of those parties who could best say whether
or not Fontana had a real opportunity to sell them an
airplane
‘ix itself pursuasive that their testimony, if given,
would have been unfavorable to (plaintiff), Phe pro-
duction of weak evidence when strong ix available can
lead only to the conclusion that the strong would have
boon adverse, (Citation omitted.) Silence then becomes
evidence of the most convincing character, (Citations
omitted.) Tnferstate Circuit’ vy. United) States, 306
US. 208, 226 (1989), ¢
We turn now go a consideration of Fontana’s motion,
as counterdetendant, for judgment notwithstanding the
verdiet as to Hartzog's counterclaim alternatively for a
new trial Hartzog, ax counterplaintiff, complained that
it was damaged beenuse it made $5,000 infringement pay
ment to Fontana. The jury awarded Hartzog $5,000 in
damages. Fontana, as counterdefendant, argues that such
a verdiet is not sustained by the evidence or by law and
that any loss suffered by Tartzog was the direet and
proximate result of its own conduct,

The thrust of Fontana’s position in this motion is not
that it failed to receive a payment from Hartzog, but that
such payment did not really injure Hartyog. Given that
Fontana did receive this payment, it is clear that Fontana
benefited from the infringement system. The converse in
not Necessarily true, That is, simply because Hartzog made
a payment to Fontana does not mean that Hartzog was in-
jured, for as counterdefendant suggests, Hartzog may have
hoon a mere conduit. Indeed, it appears that this was the
ease, that both Fontana and THartzog benefited from the
infringement system, and that Gopher Aviation was the
party who. suffered an injury because it was required to

Alb

pay the infringement fee, In addition, ax we have noted
earlier, we find it somewhat inconsistent to offset Fon-
tana’s $1,000 loss with and its $5,000 gain under the in-
fringement system, and then enforce a counterclaim based
on that $5,000 gain,

In conclusion, with respect to count one, we have re-
viewed the evidence relative to each element of claimed
damages, We have found that the overwhelming weight of
the evidence, without regard to issues of credibility, indi-
cates that plaintiff! was not damages in the twenty-one in
tances discussed and, therefore, that the jury's verdict
was in-error, Defendants’ motion for judgment notwith-
standing the verdict is granted, Defendants’ motion for na
new trial is conditionally granted, should this, judgment be
vacated or reversed, Rule 50 (¢), Fed, R, Civ, PL For the
reasons stated in the opinion, the motion of plaintiff for
Judgment noo. v. as to the counterclaim is also granted,
and its alternative motion for a new trial is also condi.
tionally granted,

Enter:

/*/ Awnanam TL. Manovers,
Date; March 7, 1969,

Al6

ORDER.

(Filed Mareh 10, 1{4im, )

This matter coming on to be heared on (1) motion of
defendants, Beech Aireraft) Corporation wed Phat veg
Sehneck Aviation, Ine. pursiant fo Rule ad cb) of the
Moderal Rules of Civil Procedure to set aside the verdict
of the jury with respeet to Count Poof the complaint and
the judgment entered thereon, and to enter judgment for
defendants, Beech Aireraft) Corporation woe Thartvog
Sehneck Aviation, Ine, and) the alternative motion of
defendants pursuant to Rule of of the Mederal Rules of
Civil Procedure for a new trial if their motion under
Rule d0 ¢b) be denied or, if their motion under Rule 0
cb) be granted, that a new trint be conditionally granted
pursiant te Rule a0 (e) of the Federal Rules of Civil Pre
cedures amd (2) motion ef plaintitY, Montana Aviation,
Ine, pursuant te Rule 50 (bh) of the Federal Rules of Civil
Procedure to set aside the verdict of the jury with respect
to the counterclaim of defendant, Hartzog Sehneck Avia
tion, Tre, ated the juckement entered thereon, and to enter
judgment for plaintiff, Montany Avintion, Ine. and, al
ternatively, for a new trial, the Court having filed amen
orandum opinion en Mareh 7, 1960 with respeet to the
disposition of said motions, It Is Ordered;

1 That the motion of defendants, Beech Aireraft: Cor
poration and Thartzog Schneck Aviation, Ine, fo set aside
the verdiet of the jury with respeet to Count 1 of the com
plaint and the judgment entered thereon is granted, and
said defendants’ motion for judgment notwithstanding
caid verdiet is granted, and it is, therefore, Ordered that
the Clerk enter Judgment that the plaintif? take nothing,
that the action be dismissed on the merits,

A\7

SOP the aforesaid: judgment be vacated or reversed,
then defendantn’ motion fora new trials granted on the
grounds set forth ino the Court's memorandum opinion
filed herein on Mareh 7, 100,

(Phe motion of plantil, Montana Aviation, Tne, to
nef oaside the verdiet of the jury with respeet to the eoun
fevelwim of clefemdant, Tlartzog Sehneck Aviation, tne.,
wield the judpaent entered thereon is granted, and ite me
tion to enter judgment fom plamtill with respect to the
eauaterelaim ois allowed and itis, therefore, Ordered
that the Clerk enter Judgment that defendant, Martzoy
Schnecek Aviation, Tne, take nothing with respeet to maid
counterclaim, Chat said counterclaim be dismissed on the
merits,

4.1 the aforesaid judgient be vacated or reversed,
Hhen polamtitls’ motion for a new triad is granted on the
grounds set forth on the Court’s memorandum opinion
filed herein on Mareh 7, 1969,

Mater: Ald. Manoverz,
Judge.
Dated: Mareh 10, 1969, !

Als

OPINION OF CTH COURT OF APPEALS,
September 23, 1970,

Before Winey, Mamentio and Prony Corneal Judges,

Peo, Corewt Judge. Montana, appellant hereim, is a
Michigan corporation operating at an airport in tren
Mountain, Michigan, and engaged in the business of selling
and oservieige Hirphines, as well as’ providing various
Hight connected serviees, Appellee, Beeeh, is a Deleware
Corporation with its principal place of business ta Navas,
It is engaged in the iiaanufaeture, distribution and sate
of aireraft under the trade name ' Beeeheralt.’ Beek
sell its planes through a nationwide network of twenty
four distributors who in turn sell largely to retail dealers
although Beeeh at all material times invelved owned ane
operated somecdistributor companios, whieh not only sold
to Independent dealers but also to the ultimate consumers,

The appellee, Tlartveg, isan Elineis corporation located
in Roektord, Tineis, Tt has been a Beecheralt distributor
singe IGT and cits territory ineluded not only portions
of Hiinois but of several adjoining states ineluding the
upper peninsulaof Michigan, in whieh Montana was located,
While Hartzog sold to independent dealers, it alse sold
directly to consumers through its wholly owned dealer
COULPINY,

Fontana had been a Beecheratt dealer sinee 146, Kol-
lowing Tlartzog’s becoming. a Beecheraft: distributor in
il, Fontana purchased airplanes sold by it from Tlart-
gog until the termination of the dealership by Hartzog
in April 1966,

: _A19

Subsequent to the termination, Montana filed an anti
Trust aetion against Beech and THartzog alleging a con-
xpiracy whereby the United States was divided into ex
clisive ferritorion with each distributor having a separate
lerritory and with distributors being restricted from com
peting in-each other's territory; prices were fixed on the
resale of new Beech aireraft; legal demonstrator and
stocking requirements were imposed on independent dealers
and restriction was made on the sale of a new? model
vireralt known as the King Air Model to distributor
organizations or their wholly owned dealer companies,
Montana claimed that its dealer contract was cancelled
by Tlartzog pursuant to the alleged conspiracy when
Montana refused to aequiesee in territorial, stocking: and
virpline model restrictions and that Montana, subsequently,
Was Unable to secure a dealership from other distributors.

While there was some dispute between the parties on
this appeal as to various evidentiary matters, there was
lextimony adduced in the distriet court fo support a jury
finnlinge that the factual situation is the following.

Prior to 1966, Beech’s contracts with its distributors,
and the contract that) Beech distributors had with their
dealers, contained limitations upotl the sale of airplanes
outside the distributors’ or dealers’ “territory? There
were provigions for interterritorial financial adjustments
if such sales outside the territory took place. Further,
these ferritorial limitations had been the subject of dis-
cussion between Beech and its distributors. “These dis-
cussions ordinarily occurred at meetings of the Beech
distributor advisory council which met and discussed mutual
problems, The council ineluded the president of Hartzog
and the meetings were attended by officials of Beech.
In February 1964, the minutes of the council indicated
that there had been concern expressed at legal ramifications

Av

of the portion of the contract dealing with the territorial
restrietions,

During the period of IGE (o> 1966, Fontana had onde
one payment of $1000 to a distributor for an out of ter
ritory sale and had received through TRartzog one hall,
or $0000, of the amount paad by another distributor fora
silo within the Tlartzog Montana territory,

In TSM, Beoeh's standard distributer contract was
amended. ‘The provision pertaining fo finaneial adjust
ments Following outof territory sales was eliminated,
There was a provision that the distributor agreed) to
appotmt and establish ‘an its aren of responsibility’? the
mini mumber oof authorized Beecheraft) dealers re
quired fo secure adequate penetration. Tt appears that
under the TOG ayreements a distributor could neotoap
port aoaeater in anether distributor's area of respons
bility. Marly in 1966, when the corporate elass plane
market Was just beginning to develop, representatives
of Fontana and tlartzeg met, at whieh time Montana
Indicated i wanted a dealer contract whieh would permit
it to sell The relatively new King Air without, being re
quired to purchase and stock the entire dine of Beech
planes necessary to obtain al twenty pereent discount,
Hartvoy replied that) Fontana should) contine its sales
efforts to single engine and light twin’ planes only and
that it would not reeeive a contract permitting it to sell
King Air. Fontana indicated it would attempt to secure
a direct dealership trom Beech. Hlartzog replied that if
it did so Hartzog would cancel Fontana'’s contract, Sub-
sequently, Fontana unsuecessfully attempted to secure a
direct dealership from Beech, whieh declined to deviate
from its established marketing setup through distributors,
Thereafter, Hartzog terminated the Fontana dealership
contract as of April 15, 1966. Subsequently, Fontana

6
t

acetone

A2l

hough fo secure an authorized dealership from two other
distributors, one located in’ Pontine, Michigan, and one
located in Rochester, Minnesota, hese dist ributors, after
checking with Beech, declined to enter inte a dealership
contract with Montana,

Montana claimed that after cancellation it had seventeen
excellent prospects for purchase of Beech aireraft. During
the trial of the cause below, Fontana, after objections
by the defendants, was limited in’ its damage estimate,
Insofar as post-cancellation damages were concerned, to
the seventeen nanied prospects,

In addition to the post cancellation damages, Fontana
Claimed damages resulting. from three precancellation
siftiations, One was that it reeeived only a fen percent
dealer discount on sales of Baron and Travel Air Plane
sitles Instead of the twenty pereent discount beeause of its
not stocking certain Beoeh aireraft required by the dealer
contract, Secondly, Montana contended it) was improperly
confined fo oa sales agent commission of $12,500 on a
King Air sale originated by it) instead of the twenty
percent discount it would have received in the absence
of the restrietions contained ino the Hartzog contract.
Thirdly, Fontana contended it was entitled to reimburse-
ment of a $1,000 penalty paid by it toa Ke ‘ntucky distribu-
for for an out-of-territory sale,

Ax may be needed in the development of this opinion,
further speeifie reference to the factual situation appear-
ing in the evidence will be brought out in connection with
the examination of the applicable law.

Following a five week jury trial, a verdict was returned
in favor of Fontana in the amount of $150,000, on whieh
the court: entered judgment in the trebled amount. of
$450,000, together with costs and attorneys’ fees, There-
after, pursuant to defendants’ motion, the district court

Age

vacated the treble damage judgment ane entered juckgment
for the defendants notwithstanding the verdiet. The eourt
in addition conditionally granted anew trial should: this
Judgment be vacated or reversed.’ Hontana tistituted: the
present appeal from the eourt's aetion,

Diving the course of the proceedings, Hartzog had filed
a ocounterechlai for $5,000 beeause of the $5,000 territorial
nf rowement patent mide ta lontana during the course
ofits dealership. "Phe jury awarded Thartzog $5,000 on the
counterclaim. "Phe distriet court alse entered) judgment,
notwithstanding the verdiet, on the counterelaim: and dis
Missed the counterelaim on the merits. Thartzog likewise
filed an appeal,

The distriet court fudge cin an apparent partial relianee
on the then recently deeded) ease wal United States v,
Confarmer Corporation of Amertea, JW VS. Bahk Ome),
stated an tis memorandum opinion, > Wee will assume,
lat not deede, that defendants are guilty of antitrust
Violations "Phe distriet court in’ part alse apparently
rested us decision on its ultimate determination that there
Washo taetof damage shown by Fontana, thereby enabling
the court te dispase of the motion for judgment notwith
standing the verdiet without regard to a determination
of the antitrust issue. The granting of the new trial con
diponally was predieated on the same grounds supporting
the granting ef the motion for judgment mow. presumably
that there was no facet of damage. ‘Phere is no indication
iy the eourt’s memorandum opinion er order that the new
trial was conditionally granted because of a failure to prove
an antitrust case.

The result which we will reach in this opinion is: that
the Qudgment notwithstanding the verdict was erroneous.
However, We will also, as we may do, review the condi-
tonal order of the trial court, made pursuant to Rule

A238

O0(b), FREP, granting a new trial 3 Barron & Holfvoff.
Wright, Federal Practice and Procedure § 1302.1, p. 346
(195%),

Inasmuch as the distriet court did not reach a final
decision on whether a judgment notwithstanding the ver-
diet should have been granted insofar as antitrust issues
were concerned, and inasmuch as further proceedings in
the court below following the remand may involve econ-
sideration of whether to grant a motion for a judgment
notwithstanding the verdiet, on the antitrust Issue, We
deem it necessary fo turn to that issue as a threshold
question,

In so doing, we are not deciding whether the weight of
the evidence does or does not support an antitrust violation.
We are not weighing the evidence but only inquiring as to
whether there is any substantial evidence which would KUp-
porta verdict, for if there was then a motion for judgment
notwithstanding the verdict insofar as the antitrust issue
was concerned should have been overruled. 2B Barron &
Holtzoff- Wright, Federal Practice & Procedure © 1075, pp.
S84-85 (1961).

There was evidence at the trial below supportive of a con-
spiracy in violation of the Sherman Act. Tests for determi-
nation of such a violation were laid down in American
Tobacco Cov. United States, 828 U.S. 781 (1946), in which
the court stated the following (at 809-10) :

“It is not the form of the combination of the partien-
lar means used but the result to be achieved that the
statute condemns. It is not of importance whether the
means used to accomplish the unlawful objective are in
themselves lawful or unlawful... . No formal agree-
ment is necessary to constitute an unlawful conspiracy
..++ The essential combination-or conspiracy in viola-
tion of the Sherman Act may be found in a course of
dealing or other circumstances as well as in an ex-

A24

change of words... . Where the circumstances are
such as to warrant a jury in finding that the con-
spirators had a unity of purpose or a common design
and understanding, or a meeting of minds in an unlaw-
ful arrangement, the conclusion that a conspiracy is
established is justified.”’

There was evidence in the ease before us on which the
jury reasonably could have found that for the purpose of
lessening competition a rigid territorial division had been
worked out on a horizontal basis between the various dis-
tributers with the taeit approval of Beech, whieh also par-
tivipated therein through its own distributor companies,

There was evidence from which the jury could have found
that this arrangement continued up to the 1966. standard
“agreement coming into effect. If Beech, in good faith, had
eliminated unlawful antitrust aspects of its marketing
arrangements by the 1966 contract then, of course, the
conspiracy violative of the Sherman Act would have also
coased and the company should not be penalized for its
efforts to set its house in order. On the other hand, window
dressings and changes of words in contracts are not con-
trolling. The matter is one of substance and not form.

Agreements or arrangements providing for an aggrega-
tion of trade restraints are violative of the act; nor can the

restraints of trade be justified as reasonable steps taken to _

implement a valid trademark licensing system. Timken
Roller Bearing Co, v. United States, 341 U.S. 598, 998
(1951). |

The defendants contend that a manufacturer is free to
agree with his vendee in a particular geographic area that
he will sell to no others in that area.’ The Supreme Court,
although not deciding the difference in impact, did in White
Mator Co. v. United States, 372 U.S. 253 (1963), reeognize
a possible distinction between territorial restrictions aris-

Pa

A25

ing out of a vertical arrangement as opposed to one of a
horizontal nature, Nevertheless, Mr. Justice Brennan in
concurring stated at p. 267:

‘If it were clear that the territorial restrictions in-
volved in this case had been induced solely or even
primarily by appellant’s dealers and distributors, it
would make no difference to their legality that the
restrictions were formally imposed by the manufac-
turer rather than through inter-dealer agreement.”’

While the case before us would scarcely seem to be that
of the tail wagging the dog, such as apparently was involved
in United States v. Sealy, Inc., 388 U.S. 350 (1967), there
was sufficient evidence for the jury’s consideration of con-
certed horizontal action, participated in by Beech.

United States v. Arnold, Schwinn & Co., 388 U. S. 365
(1967), held that territorial limitations on resales by dis-
tributors, where the distributors own the goods were viola-
tive of the antitrust laws. In the case before us, the com-
parable situation existed in which the practical effect was
that only one distributor could enter into an authorized
dealership arrangement with Fontana.

While the law recognizes that a manufacturer, in the
batile for business, has a right to sell to whom he pleases,
this right is neither absolute nor exempt from. regulation.
If it is accompanied by unlawful conduct or agreement, or
conceived in monopolistic purpose or market control, the
right is deemed to have transgressed the act. A. C. Becken
Co. v. Gemex Corp., 272 F. 2d 1 (7th Cir. 1959).

While we have here primarily concerned ourselves with
the restraint on out-of-territory dealer appointments, we
find adequate supportive evidence in the overall pattern of
operation on which to base a verdict with regard to the
other matters of complaint by Fontana, being the stocking
requirement and the restraint on sale of King Airs. All of

ead

&

these matters could well have been found by the jury as hav.
ing been conceived axa part of an illegal market control,

Upon the basin of the foregoing, we bok! therefore that
the district court sheald ret have granted a judgment rot
withstanding the verdict on the antitrust issue, However,
unlike the motion fer jadgment n.o.v.. the matter of grant-
ing a new trial is to be determined in the sound discretion
of the trial court. GA Moore, Federal Practice J 53.08 (5),
p. 3816 (1986). Deference mast be given to decisions of the
trier of the fact who is usually in a superior position to
appraise and weigh the evidence, Zenith Redio Corp. v.
Haseltine Research, lac., 395 U. 8. 100, 123 (1969), which is
a deference which should also be accorded to the trial jadge—
in a jury case, he having heard and lived with the evidence
during a lengthy trial, On remand, the district court should
determine prior to a new trial whether the antitrust issue
should again be presented ‘te the jury or whether a new
irial should be confined te the issue of damages.

As préviously indicated herein, the district judge in
gronting judgayat was. did co on the basin of tact of
proof of the fact of damage. The damage question in pri-
vate antitrust suits is composed of two components: the
fact of damage—injury to plaintiff’s business resulting
from the alleged illegal conapiracy—and the amount of
damages. Once the fact is established, uncertainty concern-
ing the exact amount of less will not preclude recovery.

‘The rule which precludes the recovery of uncertain
damages applies to such as are not the certain result
of the wrong, not to those damages which are definitely
attributable to the wrong and only uncertain in respect
of their amount.”’ Story Parchment Co. v. Paterees
Co., 282 U. 8. 555, 562 (1981).

Ag

In Zewith Radin Corp. v. Hacettin: Research, lee. supra
at p. 114 #8, the Supreme Ooert charecteriaed plaintiff’.
harden on the critical fact of damage ixeur an follows

tron of its status ax a Beech authorized dealer. ey
+ , Fontana contended that there was supportive evidence

that all of the prospects already owned planes and that
they had business needs for executive aircraft as well

_ as having some business connection in the Iron Mountain,

Michigan region.

Fontana had previously seld planes to and done service
work for some of the prospects and a number of the pros-_ >
pects subsequently did purchase aircraft. _

Fontana’s evidence upon damages was based almost
solely upon opinion testimony of its 26 year old Board

ASS

Uhatrman, The testimony was cach that if we were weigh
veg the evidence we wowkl fed thix rather weak, bat ax we
have already stated we are wet here weighing the evidence.
The fact ix that, ever objection, the officer of Montana was
permitted te testify and te give his epinion regarding the
toss of sales to the seventeen prospects, There ix ne indies
tien in the record that the court struck the testimeny as
being speculative er conjectural or that the entry of the
jedement nov. was based apen this premise. The trial
Jeter Ss memoranda epinion specifically stated that it was
without regard te issues ef credibility.

While proof of lexx by the particular method achopterl by
‘ontana dees net meet the endinary standards, sec Pliel
hote Compang v. Lastrord, 246 F.2d QHS, 382 (9th Cir.),
vert, den, 335 US. S88) (1907), the circumstances of plain
tif'’s busitiesks and the developing cerperate aieplane mar
ket did net present the usual situation. Actually, the
testimetiy showed that plaintiff's business prier te the ter-
mination of the Recokeraft contract had been operating at
a deficit. Apparently in thix rexpect Fontana would have
been limided to showing that the deficit was even greater
after the loss of the Beechcraft dealership. Nevertheless,
the evidence was in, and remained in, and while its weight
may. be extremely questionable, we cannot say new that, for
the purpese of considering the correctness of the ruling on
ee it should have

been disregarded.

Om the retrial of this cause the court may well desire to
determine the admissibility of this type of evidence.

(wer and above this aspect of the matter, we are in a day
and age in which the value of the nationally advertised
franchise is a matter of general recognition. If Fontana
were deprived of the dealership (or franchise right) as a
result of an illegal conspiracy, some damage would appear

>

Aw

te be implicit, Beeeh’s View President conceded that Fon-
tana wouk!d be at a competitive dinadvantage im attempting
to ell cow Bauch qgiaies etter Ge tues af Se eae
theater statan

tewefar as the reline on the sateen 2O.V. Wax con
corwed, the fact that the alleged legality pat plaintiff
al a competitive disadvantage in competing fer the busi
wess of a number of tdentified prospects was adequate
te make errencons the ruling on the motion for jpedement

fren. UF there were other posible causes of plaintiffs

inatality te sell wew Reech airplanes te the apparently
sented prepects, i woukd appear that the defendant. were
veer obligation te @e ferward with evidence te that
effect and Pentana ‘was wet required in the first instance
te -preve the -absence of all other conceivable causex ws.
_Fortana Aviatios, Ixc., a

Scu neck Aviation, Inc, a Cor-.] Appeals from the
poration, ' United States Dis-~
Defendants. Appetices. trict Court for the
- Nerthern District
: of Minois, Eastern
Hanta0c-Scuxeck Aviarven, Ina, Division.
a Corporation, ~~ ' ;
Counter-Clarmant-A ppeliant, |

Counter Defendent-Appeliee.) _

“

meee? mamas

Defendants, Beech Aircraft Corporation and Hartzog
Sehneck, loc.. have moved this court fer a rehearing and
reconsideration of eur judgment in) Appeals Nos. 17734
and 17725 insefar as it taxed alf costs of the appeals t
them. :

Plaintiff, Fontana Aviation, Inc., prevailed in Nos, 17734
and 17725 as to the trial court's grant of Judgments
N.O.V. Beech prevailed in No. 17754 as to the trial court '»
conditional grant of a new trial.

Having considered the petition for rehearing, the re
sponse and the reply, we now dispose of the issue so rained
by amending the judgment in appeals Nos. 17734 and 17735
on the matter of costs only as follows:

It is hereby ordered and adjudged that the costs of the
appendix be taxed 80° to Beech Aircraft Corp. and Hart
zog-Sehneck, lnc. and 20°. to Fontana Aviation, Ine. with
credit to be allowed on the payment of said costs for the
payment heretofore made by Beech Aircraft Corp. on said
appendix. Each of the parties shall otherwise bear its -
own costs of appeal including the costs of briefs.

Such an assessment reflects, in our opinion, the relative
importance in these appeals of the issues on which each
party prevailed. Further, we are not unmindful of the
difficulties of successfully appealing the granting of a mo-
tion for a new trial and do not know, if this had been ali
that was involved, that Fontana would have appealed.

Ir Is So Ornperen.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385605_0826%3A1. Public record. Not legal advice.