Opposition Brief — Historic Green Springs, Inc. v. Virginia Vermiculite, Ltd.

No. 98-1289 MAW ' > UO

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IN THE

Supreme Court of the United States

OCTOBER TERM. 1998

)PPOSITION TO PETITION FOR A WRIT O1

CERTIORARI

QUESTIONS PRESENTED

|. Should this Court review a factbound application of the well-

established antitrust doctrine excluding noncommercial

restraints, which the Fourth Circuit expressly found consistent

with all other circuit decisions interpreting this doctrine,

correctly ruling that this doctrine was not satisfied on the highly

unusual facts of this case where: (a) to evade an antitrust duty to

deal, amonopolist made a donation coupled with anticompetitive

restraints foreclosing a huge market share of an input vital to the

monopolist’s only rival, (b) the anticompetitive purpose was

patent on the face of the donative restraints because they targeted

anticompetitive concerns over preservationist ones, and (c) the

donee knew its agreement was necessary to this anticompetitive

objective and received a significant financial gain for agreeing to

join the anticompetitive scheme?

2. Should this Court review a meritless claim -- which was never

raised by petitioner below and never addressed by the Fourth

Circuit or any other court -- that the application of federal

antitrust law to the unusual commercial acti-/ity in this case 1s

implicitly repealed by a federal tax provision governing

“t. +")

completely different conduct

TABLE OF CONTENTS

QUESTIONS PRESENTED ... 3. e000 ee eee

STATEMENT OF THE CASE). .355 9035 3 eee |

REASONS FOR DENYING THE WRIT ............... 5

1. There Is No Conflict in Authority on the

Noncommercial Restraint Doctrine. .............. 7

—

il. The Noncommercial Restraint Doctrine Was Correctly

Applied to the Facts Here, Which Would Not Fit Even

Petitioner’s Proposed Standard and Are So Unusual They

Are Unitkely te Reel... . 6605 eee eee 16

Ill. The Argument That I.R.C. §170(h) Creates an

Implicit Exemption to the Antitrust Laws Was Not

Preserved on Appeal and Involves No Conflict in Lower

Court AMGRGIHY. . ws io es eee 20

IV. The Argument That I.R.C. §170(h) Creates an

Implicit Exemption to the Antitrust Laws Relies on a

Demonstrably False Premise About Tax Law, and Even

if Accurate About Tax Law Would Fail to Rebut the

Strong Presumption Against Implicit Antitrust

ESCMIINOONE. . oc esc cae de eeeee eee

CONCLUSION

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ill

TABLE OF AUTHORITIES

Cases: Page

Allen Bradley Co. v. Union, 325 U.S. 797 (1945) ..... ++. 13

Allied Tube v. Indian Head, 486 U.S. 492, 501 (1988) .. 9, 15

American Soc'y v. Hydrolevel,

DE SE UOEED . cus ccs viwcacrerers 8-10, 14, 20

American Tobacco v. United States, 328 U.S. 781 (1946) . 2

Apex Hosiery v. Leader, 310 U.S. 469 ( Aare 12-13

‘

Aspen Skiing v. Aspen Highlands, 472 U.S. 585 (1985) ...

Ass'n for Intercoll. Ath. v. NCAA,

735 F.2d $77 (D.C. Cir. 1984) .... 0. ccc cece reece 10

Bell v. Wolfish, 441 U.S. 520 (1979) ... 66. eee eee 21

Corrosion Proof Fittings v. EPA,

947 F.2d 1201 (Sth Cir.1991) ..... 2. eee eee eeees 21

Costello Pub'g v. Rotelle,

670 F.2d 1035 (D.C. Cir. 1981) .........0 00 eee: 10-11

Dedication & Everlasting Love to Animais v. Humane Society,

$0 F.3d 710 (9th Cir. 1995) .......-.- cece e eens 10, 12

Eastern R.R. Pres. Conf. v. Noerr Motor Freight,

0 eo) ee ce a oe

a

Eastman Kodak v. Image Tech., 504 U.S. 451 (1992) ....

FTC v. Indiana Federation of Dentists,

a ee i )

FTC v. Superior Court Trial Lawyers Ass 1,

“OUR ST | ce 9,15

Goldfarb v. Virginia State Bar, 42) U.S. 773 (1975) ..... 23

Group Life & Health Ins. Co. v. Royal Drug Co.,

ee | ee a

Hennessey v. NCAA, 564 F.2d | 136 (Sth Civ. 1977)... «-: 1]

Hospital Corp. v. FTC, 807 F.2d 1381 (7th Cir. 1986) .... 8

Knetsch v. United States, 364 U.S. 361 (1960) .......--. 21

Lorain Journal v. United States, 342 U.S. 143 (1951) ray

Marjorie Webster Jr. College v. Middle States Ass'n,

nae oe B50 tC. Cir. 1970) ... 2. ee eens -. 10

iV

VICM Prtnr’s v. Andrews-Bartlett,

Ge Fae Oe CT aE 6500 5600 V6 0 ee E ERS 14

Midwest Radio v. Forum Publishing,

942 F.2d 1294 (8th Cir.1991).................. re

Missouri v. NOW, 620 F.2d 1301 (8th Cir. 1980) 2.0.0... 14

NAACP vy. Claiborne Hardware, 458 U.S. 996 (1982) .... 15

National Gerimedical Hosp. & Gerontology Center vy.

Blue Cross, 452 U.S. 378 (1981) ............... 23-24

Vational Soc 'y of Professional Engr’s v. United States,

GS Ue re Che! 6 cock peace eee aeaen 9, 23-24

VCAA v. Board of Regents, 468 U.S. 85 (1984) ....... 8-10

NOW v. Scheidler, 968 F.2d 612 (7th Cir. 1992) ...... .. 12

Ozee v. Amer. Council, 110 F.3d 1082 (Sth Cir. 1997) .... 11

Patrick v. Burget, 4860 U.S. 94 (1988) ................. 24

Preservation Coalition v. Pierce,

667 F.2a 85! (9th Cw.1962Z) .. 1... ence cnvcccuce 21

Rhode Island v. Narragansett Indian Tribe,

19 F.3d 685 (ist Cir.1994) .......... cc eee ce eee 21

Silver v. NYSE, 373 U.S. 341 (1963) ......... cece cee: 24

United States v. American Tobacco, 221 U.S. 106 (1911) .. 2

United States v. Borden Co., 308 U.S. 188 (1939) .... 13-14

United States v. Brown Univ., 5 F.3d 658 (3d Cir. 1993) 9-11

United States v. Northeastern Pharmaceutical,

SIG F.20 £20 (Br Caw.) ow. ccc wc wee rsccsacucs 21

United States v. Paramount, 334 U.S. 131 (1948) ........ 14

Universal Analytics v. MacNeal-Schwendler Corp.,

914 F.2d 1256 (9th Cir.1990) ........... Rp

Constitutional Provisions, Statutes, and Rules:

Sherman Act §1, 15 U.S.C. §1 ........00.00....00... 4,8

ee FACE OO, EU ONT occ so cae the one es 12-13

IL.R.C. §170(a), (c), 26 U.S.C §170(a), (c). 2.2.2.2... . 22

ILR.C. §170(f)(3), 26 U.S.C §170(f)(3) 2.2.00 0000. 22-23

[L.R.C. §170(h), 26 U.S.C §170(b) 2... ee. 5-6, 20-23

Bee UPD. 1. ACEI ee) caccoesivvncdccssavsas ae

Il] AREEDA & TURNER, ANTITR (19

DA, ELHAUGE & HOV!

ANTITRUST LAW (1995)

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AREEDA & HOVENKAM \ li kK { ipp o,

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(’.J.S. AMICUS CUR

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Respondent Virginia Vermiculite, Ltd., respectfully requests

that this Court deny the petition for a writ of certiorari, which

seeks review of the Fourth Circuit’s decision holding that

petitioner enjoys no immunity from antitrust suit on the

particular facts of this case.

STATEMENT OF THE CASE

In a decision that not a single judge on the Fourth Circuit

found merited en banc review, App. 16a, a unanimous Fourth

Circuit panel correctly found that the well-established

noncommercial exception to Sherman Act §1 was not satisfied

on the highly unusual facts of this case. App. 9a-12a. Those

facts merit restating because the petition misstates those facts,

misleadingly obscures the anticompetitive scheme, falsely

characterizes the holding below and claims it recognized a

conflict with other circuits, and misleadingly implies petitione!

raised an issue below that in fact it never raised till now.

1. The Highly Unusual Facts. There are only two domestic

producers of processed vermiculite, which can be mined and

processed in only two domestic locations: South Carolina and

Virginia. App. 3a-4a. Because of the weight of raw vermiculite,

it must be processed within a few miles of the mines. App. 22a;

JA 571-72.' Grace is a vermiculite monopolist that mines and

processes vermiculite only in South Carolina. App. 4a

Although it never mined or processed vermiculite in Virginia,

Grace bought up 80% of the vermiculite deposits in Virginia in

the 1970s and proceeded to suppress their use for the next 20

years. /d. By the 1990s, Grace’s only domestic rival -- Virginia

Vermiculite -- was about to run out of its Virginia deposits and

wanted to buy Grace’s unused vermiculite deposits. /d

lhe situation left Grace in something of a bind. If Grace sold

Virginia Vermiculite the deposits, Virginia Vermiculite would

stay in business and create real competition for Grace in the

vermiculite market. But if Grace retained the deposits unused,

'“JA” refers to the Joint Appendix before the Fourth Circuit. “App.” refers

to the appendix to the petition for certiorari

tr

Grace would presumptively have faced antitrust liability under

the doctrine that a monopolist who refuses a rival access to a

useful resource violates antitrust law if motivated by the refusal’s

exclusionary effect rather than legitimate business purposes.’

Indeed, Grace would almost certainly have faced antitrust

liability under the special doctrine prohibiting a monopolist from

buying up and suppressing necessary inputs to keep them from

its rivals.’ Given that this antitrust doctrine applies even for

duplicable inputs like plants, supplies, and personnel, then it

certainly would have applied where (as here) the suppressed

inputs are nonduplicable natural resources.

To evade its antitrust duty as a monopolist, Grace had to sell

or transfer its deposits to someone else. But it knew that anyone

else who had the deposits would have financial incentives to

resell them for their most valued use: vermiculite mining. Grace

then came up with the ingenious idea of making a strategic

donation to continue Grace’s suppression of these deposits.

Pursuant to this anticompetitive scheme, Grace and petitioner

agreed that Grace would donate all the deposits to petitioner.

‘Aspen Skung v. Aspen Highlands, 472 U.S. 585 (1985); Lorain Journal \

(/nited States, 342 U.S. 143, 155 (1951); Eastman Kodak v. Image Tech., 504

U.S. 451, 483 n.32 (1992); App. 8a

‘See United States v. American Tobacco, 221 U.S. 106, 183 (1911)

(monopolization proven by the “persistent expenditure of millions upon

millions of dollars in buying out plants, not for the purpose of utilizing them,

but in order to close them up and render them useless for the purposes of

trade”), American Tobacco v. United States, 328 U.S. 781, 803-04 (1946)

(defendants monopolized by buying unneeded tobacco to keep it from rivals);

Il] AREEDA & TURNER, ANTITRUST LAW 9604, at 8 (1978) (“buying rival

plants in order to close them constitutes monopolizing behavior’); id. 97314,

at 250 (“It would clearly be exclusionary for a monopolist . . . to acquire

supplies obviously in excess of his needs”); id. 9707c, at 110 (“Acquiring

talent not to use it but to deny it to possible rivals is exclusionary”); Universal

fnalytcs v. MacNeal-Schwendler Corp., 914 F.2d 1256, 1258 (9th Cir. 1990)

(same); Midwest Radio v. Forum Publishing, 942 F.2d 1294, 1297 (8th

(ir.1991) (same)

Ww

App. 4a-5a. But Grace did not trust petitioner not to resell or

mine the property itself. Instead, as a condition of the transfer,

Grace and petitioner agreed to restraints preventing vermiculite

mining on the donated land. App. Sa.

Grace’s purpose was thus anticompetitive, which was well

known by the petitioner. App. 4a-Sa, lla. Indeed, two other

features emphasized that -- on its very face -- the patent purpose

of this duty-evading donative restraint was anticompetitive, not

preservationist. Grace and petitioner agreed to modify the

original restraint -- which would have prohibited all mining -- to

prohibit only vermiculite mining. App. 25a; JA 578-79. Since

other mining poses an equal threat to preservation, the

modification clearly indicated that petitioner wanted the freedom

to deviate from the pure preservationist principles it here

espouses, and that Grace did not really care about preservation

as long as the mining that posed a competitive threat to it

(vermiculite mining) was prohibited. Furthermore, apparently

worried that post-mining reclamation might make vermiculite

mining consistent with preservation, Grace and petitioner agreed

that the prohibition on vermiculite mining applied even 1f

reclamation eliminated preservationist objections by completely

restoring the land to its prior state. App. 24a; JA 57,

In short, the restraints attached to the duty-evading donation

were modified to prohibit vermiculite mining even when it doe:

not cause preservation problems and to permit non-vermiculit

mining even when it does. The anticompetitive purpose of the

transaction was thus obvious on the face of the donative restraint

Further, petitioner had a clear financial interest in thi

transaction. In return for agreeing to help Grace achieve it

anticompetitive purpose, petitioner received nearly 1400 acres of

land, much of which it re-sold for monetary gain. App. 4a-5a

7a-8a, 1 la. The agreement also furthered the financial interests

of petitioner’s management and members, who owned property

whose value would have suffered if the agreement had not

prevented hundreds of acres from being added to the local supply

4

of marketable property. App. 7a-8a, 11a; JA 575. Indeed, as the

Fourth Circuit observed, the mere fact that the parties found it

necessary to prohibit petitioner from engaging in vermiculite

mining suggested petitioner had goals other than eliminating

such mining. App. 8a.*

2. The Proceedings Below. The Fourth Circuit below

correctly held that these facts alleged an agreement in restraint

of trade, and that petitioner enjoyed no antitrust immunity under

the doctrine excluding noncommercial restraints. App. 6a-1 2a.

But petitioner is wrong to repeatedly -- and falsely -- assert that

the Fourth Circuit acknowledged its decision conflicts with

decisions from cther circuits. Pet. 2, 7. The Fourth Circuit did

no such thing. To the contrary, it explicitly considered these

decisions from other circuits and concluded that its decision was

fully consistent with them. App. 10a. The Fourth Circuit

recognized that these other circuits were correct that the plain

language of Sherman Act §1 does not cover “noncommercial

behavior.” /d. The Fourth Circuit simply made a fact-specific

determination that the behavior in the case at hand was

commercial, and thus not within the doctrine excluding restraints

on noncommercial activity that the Fourth Circuit joined other

circuits in recognizing. App. 10a-12a.

*The Fourth Circuit decision reviewed a complaint dismissal and thus

properly decided the case based on the facts alleged in that complaint. In

contrast, the petition for certiorari improperly goes outside the appellate

record to assert facts that are not contained in the complaint and that Virginia

Vermiculite vigorously disputes. For example, the petition asserts that: (1)

petitioner's motive was not financial but rather solely to preserve and protect

the land; (2) petitioner's agreement prevented a form of strip-mining that

would cause irreparable harm to preservationist values; and (3) the actual

purpose for bringing this suit was to drive petitioner out of existence rather

than to correct the anticompetitive harm. Pet. 1, 2, 4, 18, 27. These

unilaterally asserted facts are neither true nor part of the appellate record, and

thus cannot form a basis for this Court’s certiorari review,

5

Petitioner is also wrong to mischaracterize the Fourth Circuit

as holding that a nonprofit’s “mere” acceptance of a donation for

noncommercial purposes is commercial conduct subject to

antitrust scrutiny. Pet. 7-9. Instead, the Fourth Circuit decision

emphasized that: (a) this was no “mere” donation but a donation

that evaded a monopolist’s antitrust duty to deal and was coupled

with anticompetitive restraints foreclosing a huge market share

to the monopolist’s only nval; and (b) the transaction did not

involve “mere” noncommercial purposes because the transaction

had an anticompetitive purpose that the donee knew about and

had a financial interest in furthering, given that the donee

received significant financial gains for agreeing to help the

monopolist further that anticompetitive purpose. App. 4a-Sa, 8a,

1 la-12a.

Petitioner also misleadingly implies that below it raised the

issue Of whether I.R.C. §170(h) precludes the application of

federal antitrust law to its conduct. Pet. 19-20. In fact, petitioner

never raised this issue below. Instead, the issue was raised

below only in an amicus brief, and was thus properly never

considered or discussed by the Fourth Circuit.

REASONS FOR DENYING THE WRIT

It is not surprising that no judge on the Fourth Circuit either

dissented from this opinion or found it worthy of en banc review.

This case involves the correct but factbound application of an

undisputed legal standard to particular facts that are so unusual

they are highly unlikely to recur.

There is even more reason why the petition for certiorari

should be denied. U.S. SUPREME COURT RULE 10 counsels that

normally certiorari is appropriate only when there is a legal

conflict either between the lower appellate courts or between one

such court and decisions of this Court. There is no such conflict

in this case. On the noncommercial restraint issue, the Fourth

Circuit decision instead correctly ruled that its decision was

completely consistent with all rulings in other federal circuits.

6

App. 10a-12a. On the purported tax exception issue, petitioner

does not even allege such a conflict, nor could it since no court

(including the one below) has ever ruled on this issue.

This is simply not the sort of case that merits an allocation of

the scarce resources this Court has to devote to reconciling

conflicting lower court decisions. Even less can we say that the

case presents issues that have percolated in the lower courts and

reached a stage where the existence of multiple decisions and

extensive legal analysis renders a conflict ripe for this Court’s

consideration. All the circuits recognize the doctrine excluding

noncommercial restraints, but the Fourth Circuit 1s the only one

to consider whether that doctrine applies to the unusual sorts of

facts alleged here. And no circuit -- including the Fourth -- has

ever rendered an opinion on the purported issue of whether

| R.C. §170¢h) ever impliedly repeals some applications of

federal antitrust law.

Even if this Court were in the business of deciding issues

before any lower-court conflict had arisen, the issues here would

not be appropriate for this Court’s review. On the doctrine

excluding noncommercial restraints, petitioner argues that a mere

donation with purely noncommercial purposes should not be

deemed commercial. Pet. 7-9. But this would be an extremely

poor test case to develop this proposition for petitioner does not

meet its own proposed standard. Rather, it is basically arguing

that the Fourth Circuit was wrong to conclude that the

transaction here involved neither a mere donation nor purely

noncommercial purposes. “A petition for certiorari is rarely

vranted when the asserted error consists of... the misapplication

ofa properly stated rule of law” See U.S. SUPREME COURT RULE

10. On the alleged antitrust exemption created by ILR.C.

$170(h), there was no discussion tn the lower court at all because

the issue was never raised by petitioner. The issue was thus not

properly preserved on appeal, and in any event has not received

the sort of briefing below that would make it appropriate for

review by this Court.

7

Finally, even if the issues were appropriate for decision by

this Court, petitioner is manifestly wrong on both issues. While

donations to charities are normally noncommercial, the Fourth

Circuit was clearly correct that this transaction differed from a

normal donation in way that made it essentially commercial.

Donations do not normally: evade a donor-monopolist’s antitrust

duty, come coupled with restraints that patently further not

charitable goals but the anticompetitive goal of foreclosing a

huge market share to rivals, and involve a financial payoff to the

receiving charity for agreeing to join the anticompetitive scheme

This case appears to be the only one of its kind The decision

below in no way threatens normal noncommercial donations that

do not have these peculiar features.

The argument that a tax subsidy creates an antitrust

exemption utterly fails to rebut this Court’s heavy presumption

against implicit antitrust exemptions. Indeed, it rests on the

palpably false premise that, to get its tax deduction, Grace had to

impose restrictions on the property it gave petitioner. In fact, the

mere giving away of property to a charity is clearly sufficient to

get a tax deduction, as anyone who has given property to a

charity knows. The tax code cited by petitioner applies instead

to the entirely different situation where the party seeking the tax

deduction keeps the property, and donates away only a partial

interest (like an easement) on that property. In such cases, the

tax code quite sensibly requires some proof that the easement

imposes a real restriction on the purported donor who retains the

property. This provision does not apply where, as here, the

donor gives away its entire interest in the property.

I. There Is No Conflict in Authority on the

Noncommercial Restraint Doctrine. The circuits all agree that

the Sherman Act excludes restraints on noncommercial activity.

This case just involves the factbound question of whether this

particular restraint fits within this doctrine. To avoid this

problem, petitioner tries to frame the decision below as in

8

conflict with a purported doctrine that nonprofits acting with

noncommercial purposes are immune from antitrust scrutiny for

any restraint of trade coupled with a donation. Pet. 7-8. But no

case has ever so held, and thus there is no conflict in authority on

the issue petitioner raises. To the contrary, the cases uniformly

hold that noncommercial restraint doctrine turns not on whether

a party has nonprofit status or noncommercial motives but rather

on whether the activity restrained is noncommercial. Nor does

antitrust law confer any immunity on conspirators clever enough

to attach the sheep’s clothing of a donation to their wolfish

anticompetitive restraints of trade.

fhe text of the sherman Act contains no exemption for

nonprofits, however noncommercial _ their motives or

disinterested their incentives. Rather, Sherman Act § | states:

“Every contract, combination . . . or conspiracy, in restraint of

trade or commerce ... is... illegal,” and applies this prohibition

to “fe]very person” entering such an agreement. Further,

Sherman Act §8 defines “person” to include all “corporations”

authorized by state law, which would include nonprofit

corporations. Nor does the text provide any language excluding

of restraints of trade that are attached to donations.

Accordingly, this Court has explicitly held that nonprofits are

fully subject to the Sherman Act. See NCAA v. Board of

Regents, 468 U.S. 85, 100 n.22 (1984); American Soc y v.

Hydrolevel, 456 U.S. 556, 576 (1982).5 This Court has also

‘ ‘This conclusion is not only dictated by the statutory text but supported by

sound policy. “Non-profit status affects the method of financing . . . and the

form in which profits... are distributed... But no one has shown that it

makes the enterprise unwilling to cooperate in reducing competition . . which

nonprofit enterprises may dislike on ideological as well as selfish grounds.”

Hospital Corp. v. FTC, 807 F.2d 1381, 1390 (7th Cir. 1986) (Posner, J.).

Accord ARFEDA & HOVENKAMP, ANTITRUST LAW 9232.2, at 354-60 (Supp.

1997) (same, adding that “{iJf the behavior is anticompetitive, the

consequences are equally detrimental whether or not the actor” ts a

nonprofit).

a ee eee

9

repeatedly held that noncommercial motives do not save an

otherwise illegal restraint -- even if the entity with the

noncommercial motive is a nonprofit or any other public-spirited

organization.® Indeed, this Court has held that nonprofits are

liable for participating in a restraint of trade or commerce even

when they receive no benefit (financial or otherwise) for

participating in the restraint.’

The doctrine excluding noncommercial restraints does not

deviate from the statutory text or these well-established

precedents. Rather, as the Fourth Circuit correctly observed, it

rests squarely on the statutory language that the “restraint” must

be “of trade or commerce,” and thus excludes cases only where

the activity restrained is noncommercial, not where the entity

that engages in the restraint (or its motive) is noncommercial.

App. 10a. Petitioner falsely claims the circuits are in conflict,

but in fact the Fourth Circuit is correct that all cases hew to this

distinction between a noncommercial restraint and a

® See NCAA, 468 U.S. at 101 n.23 (rejecting defense that nonprofit had

social objective of preserving amateur sports because “good motives will not

validate an otherwise anticompetitive practice”); National Soc'y of

Professional Engr’s v. United States, 435 U.S. 679, 681 (1978) (professional

association liable for ethical canon even though its “purpose” was to protect

“public safety”); FTC v. Indiana Federation of Dentists, 476 U.S. 447, 462-

63 (1986) (professional association liable even though its purpose was a

“legal, moral, and ethical policy of quality dental care”); FTC v. Superior

Court Trial Lawyers Ass'n, 493 U.S. 411, 421-24, 427 & n.11 (1990)

(professional association liable even though purpose was to vindicate Sixth

Amendment rights because the Sherman Act provides no “immunity from

prosecution on the basis of their good intent”). See also United States v

Brown Univ., 5 F.3d 658, 666 n.7 (3d Cir. 1993) (nonprofit is not exempt for

restraint on commerce even if nonprofit had a “beneficent objective’).

’Hydrolevel, 456 U.S. at 560-62, 74 (holding nonprofit liable for issuing

a letter that, without any benefit to the nonprofit, interpreted a safety standard

in a way that restrained trade); Allied Tube v. Indian Head, 486 U.S. 492, 501

(1988) (stating antitrust rule of reason would apply to safety standard setting

by financially disinterested nonprofit associations).

10

noncommercial entity/motive. App. 9a-10a. The cases deny

immunity to nonprofits with noncommercial objectives

whenever their restraint is on commercial activities. See NCAA,

468 U.S. at 92-93 (no immunity for nonprofit with

noncommercial motive that restrained the sale of broadcast

rights); /fvdrolevel, 456 U.S. at 574, 576 (no immunity for

nonprofit with noncommercial motive that restrained the sale of

boilers); Brown, 5 F.3d at 666-68 (no immunity for nonprofit

with noncommercial motive that restrained the sale of

education). The cases grant noncommercial immunity to

nonprofits only when their restraints are on noncommercial

activities. In Marjorie Webster Jr. College v. Middle States

Ass'n, 432 F.2d 650 (D.C. Cir. 1970), the restraint was on

granting free accreditation to educational institutions. The

absence of any charge for the accreditation meant jt was a

noncommercial activity, and thus that restraints on that activity

were noncommercial. In Dedication & Everlasting Love to

fnimals v. Humane Society, 50 F.3d 710, 712 (9th Cir. 1995),

the restraint was on soliciting donations. Because soliciting

donations did not involve any sale of products or services, it too

was not a commercial activity being restrained. Likewise, if two

philanthropists agree to divide the “market” for giving charity to

the homeless by each taking care of a different side of a city,

App. 36a, the restraint would be on giving charity, which is a

noncommercial activity. Indeed, far from supporting the

proposition that noncommercial nonprofits enjoy any immunity

to engage in activities that restrain commercial activities, these

cases explicitly reject this proposition. Dedication, 50 F.3d at

713; Marjorie Webster, 432 F.2d at 654-55 & n.21.8 In this

“Though Marjorie Webster in dicta refers to whether the nonprofit had a

“commercial motive,” subsequent cases in that circuit repudiate any notion

that anoncommercial motive affords any exemption to a nonprofit’s restraint

on a commercial activity. See Ass'n for Intercoll. Ath. v. NCAA, 735 F.2d

$77, 583 & n.6(D.C. Cir. 1984): Costello Pub'g v. Rotelle, 670 F.2d 1035,

1]

case, although the transaction includes a donation, the alleged

restraint of trade is not on the solicitation or giving of donations

Rather, the restraint is on aclearly commercial activity -- mining

vermiculite -- and the anticompetitive effect on that commercial

activity was patent on the face of the transfer documents.

If one follows the above precedent and thus properly puts

aside petitioner’s nonprofit status and allegedly noncommercial!

purposes, the only remaining factor that petitioner argues

affirmatively justifies its assertion of immunity is thai the

transaction here was coupled to a donation. Pet. 7-i0. But there

is no authority supporting the proposition that any transaction

involving a donation is noncommercial. Such an immunity

would, contrary to law, preclude all antitrust review of

Microsoft’s coupling of Windows 95 and its Internet Explorer on

the ground that the latter was “donated.” See X AREEDA,

ELHAUGE & HOVENKAMP, ANTITRUST LAW 41758, at 341 & n.2

(1995) (antitrust tying doctrine applies even if the tying or tied

products are given free of charge). Indeed, the only circuit other

than the Fourth Circuit to consider whether there should be an

antitrust immunity for donations to nonprofits explicitly rejected

that proposition. See Ozee v. Amer. Council, 110 F.3d 1082,

1093 (Sth Cir. 1997). That case held that a donation to charity

is acommercial transaction when the donor receives an “annuity,

substantial tax advantage, and the satisfaction of having given to

charity.” /d. The Fourth Circuit decision below is clearly

consistent with this ruling since here the donor (Grace) received

the tax advantage and satisfaction as well as a suppression of

competition far more valuable than any annuity. Moreover,

creating a new judicial safe harbor for donations would be

unwise since it would merely encourage parties to do what Grace

did here, restructure its restraints of trade in the guise of a

donation

1056 (1) ¢ Cu 198] ). See li B) MN | $d at 66 ) 6» He NnNeSsse

NCAA, 564 F.2d 1136, 1148-49 (Sth Cir.19

12

Contrary to petitioner, Dedication & Everlasting Love does

not support a doctrine providing antitrust immunity to all

restraints of trade involving donations to a nonprofit. Pet. 9-10.

It merely held that a restraint on the solicitation of donations was

not covered because the restrained activity -- soliciting

donations -- was not a commercial activity. 50 F.3d at 712.

There was no claim in that case that the solicitations were

restraining commercial activity, and the opinion nowhere held

that a nonprofit would be immune if it obtained a donation under

conditions that restrained some other commercial activity. There

is thus no inter-Circuit conflict on this issue.

Petitioner also wrongly asserts that the Fourth Circuit's

decision below conflicts with the Seventh Circuit’s decision in

NOW v. Scheidler, 968 F.2d 612 (7th Cir. 1992). Pet. 11-12, 15.

But what that case held, relying on Apex Hosiery v. Leader, 310

U.S. 469, 482-501 (1940), was that conspiracies to trespass,

seize, or vandalize property, or to harass, block, or injure

persons, are not restraints of trade even though directed at a

business and resulting in a reduction of its output. See Scheidler,

968 F.2d 612, 615-17, 622. This is clearly correct. A successful

conspiracy to kill Bill Gates would no doubt reduce Microsoft’s

output, but would be a conspiracy to murder, not a conspiracy to

restrain trade. But again the reason is that this sort of activity

does not fit within the statutory language of Sherman Act §1, not

that the actors are nonprofits with noncommercial purposes.

Indeed, neither Apex nor Scheidler involved nonprofit

defendants, and the Apex labor union was financially interested

in making the employer accede to its demands. The activities

were held not to be agreements in “restraint of trade” because

they involved no agreement to restrict competition or production,

or to withhold the marketing of goods or services. Apex, 310

U.S. at 494-95, 497 (“restraint of trade” must involve “some

form of restraint upon commercial competition in the marketing

of goods or services” or restrict “production”); Scheidler, 968

F.2d at 622 (defendants were engaging in “violent

13

‘reprehensible’ conduct,” not “exercising market power’’).”

Those cases have nothing to do with this case, which challenges

not violent conduct but an agreement to transfer property on the

condition that the recipient not deal with the transferor’s rivals,

which has the effect of directly restricting vermiculite

production, evading a monopolist’s antitrust duty to deal, and

closely resembles tying and exclusive dealing agreements

traditionally covered by antitrust law.

Consistent with the logic of the statutory language, none of

the above decisions applying the noncommercial restraint

doctrine has ever held that it renders only one of the co-

conspirators immune from antitrust suit. Either the restraint 1s

“of trade or commerce,” and neither conspirator is immune, or

the restraint is not “of trade or commerce,” and neither

conspirator is covered. Yet a mixed holding is precisely what

petitioner seeks, for it does not deny that the statute covers

Grace. Nor could it since Grace is a for-profit that was acting for

totally commercial and anticompetitive purposes in restraining

competition by its only rival. Petitioner instead seeks a holding

that it is immune from suit even though its co-conspirator, Grace,

is not. Pet. 6, App. 9a. Petitioner’s position thus conflicts with

the logic of the doctrine, which turns on the commercial nature

of the restraint, not of the conspirators. Petitioner’s position also

conflicts, as the Fourth Circuit noted, with the well-established

doctrine that an otherwise exempt actor loses its antitrust

exemption if it conspires with a nonexempt party. See Allen

Bradley Co. v. Union, 325 U.S. 797, 809-10 (1945); United

*4pex also stated that, though its facts did not involve an agreement to

withhold labor, id. at 504, such an agreement would not be a restraint of trade

or commerce, but here it relied on Clayton Act §6, which explicitly defines

“labor” as not being “commerce.” /d. at 502-04. In contrast, an agreement

not to buy a firm’s products -- even though also involving a union pursuing

the very same objectives -- was a restraint of trade or commerce. Id. at 505-

07 (“the objective of the restraint... was . . . immaterial because . . . the

restraint itself’ was “offensive’’).

14

States v. Borden Co., 308 U.S. 188, 204-05 (1939); App. 1 la.

Finally, petitioner's notion that its different motive should save

it from antitrust liability also conflicts with the well-established

doctrine that knowing participation in an anticompetitive scheme

suffices for liability even if one does not share the

anticompetitive motive of the co-conspirator.” Petitioner offers

no answer to these fatal defects in its legal theory.

In“ short, the decision below by the Fourth Circuit ts

completely consistent with all decisions involving nonprofits and

the noncommercial restraint doctrine that have been rendered by

this Court or other circuits, including the above decisions by the

Third, Fifth, Seventh, Ninth and District of Columbia Circuits.

Finally, petitioner tries to manufacture a conflict with other

decisions that did not concern the noncommercial restraint

doctrine at all, but rather concerned the Noerr and First

Amendment protections for political petitioning. For example,

petitioner claims a conflict with the Eighth Circuit decision in

Missouri v. NOW, 620 F.2d 1301 (8th Cir. 1980). Pet. 12. But

that decision expressly relied not on the noncommercial nature

of the restraint but on the fact that it involved political

petitioning: “we do not rest our decision in this case upon the

basis that the boycott was noncommercial and non-economic.

Our decision is based upon the right to use political activities to

petition the government... .” 620 F.2d at 1315 n.16 (emphasis

" Hydrolevel, 456 U.S. at 573-74 (holding nonprofit liable for participating

in a restraint that financially benefits a co-conspirator even though the

nonprofit neither engages in the restrained business nor financially benefits

from the restraint); United States v. Paramount, 334 U.S. 131, 160-61 (1948)

(“acquiescence in an illegal scheme is as much a violation of the Sherman Act

as the creation and promotion of one”); MCM Prtnr’s v. Andrews-Bartlett, 62

F.3d 967, 972-75 (7th Cir.1995) (collecting cases and finding liable a party

coerced into exclusive dealing harming its financial interests); App. | la.

There is also the practical problem that petitioner now holds all the deposits.

Thus, any remedy limited to Grace would leave in place the suppression of

deposits that was Grace's anticompetitive goal.

SE

16

II. The Noncommercial Restraint Doctrine Was Correctly

Applied to the Facts Here, Which Would Not Fit Even

Petitioner’s Proposed Standard and Are So Unusual They

Are Unlikely to Recur. It would of course be wrong to

conclude that every agreement to donate land to a nonprofit for

noncommercial purposes was a commercial transaction covered

by antitrust law. But the Fourth Circuit reached no such

conclusion, and this is no such case. The very facts that explain

why the Fourth Circuit’s decision was correct also make clear

why this situation was so unusual and unlikely to recur, and why

it does not even fit the legal standard petitioner proposes.

The Fourth Circuit decision below relied on a combination of

unusual factors in reaching its conclusion that the restraint here

was commercial. It noted that the restraint foreclosed a

significant market share of the supply of a commercial product.

App. lla. It reasoned that the donor was in the unusual position

of using a donation to evade an antitrust duty to deal. App. 8a.

It stressed that petitioner knew that it was joining a conspiracy

to restrain trade that furthered the anticompetitive motives of its

commercial co-conspirator. App. | la-12a. And it observed that,

by joining the conspiracy, petitioner received a large pecuniary

gain and furthered the commercial interests of its management

and members. App. 1 la.

Thus, this was no ordinary donation. Donations are not

ordinarily coupled with anticompetitive restraints that foreclose

a huge market share to the monopolists’ only rival. This one

was. Donations are not ordinarily given to evade antitrust duties.

This one involved a monopolist who bought up and suppressed

resources necessary for competition for twenty years and then,

to evade its antitrust duty to make those resources available to

rivals, donated away the resources subject to that duty.

Donations normally do not (and could not) further any

anticompetitive purpose. Here the anticompetitive purpose of

the donative restraint was well-known to the donee and patent on

its face because it targeted competitors instead of preservationist

a ae

17

concerns. And while donees do normally benefit by the receipt

of a donation, they do not normally agree to join an

anticompetitive scheme in exchange for hundreds of acres of

land, some of which they sell for profit and the rest of which they

keep off the market to maintain the market price of property

owned by their management and members.

If there are other donations that have been strategically

designed to restrain trade, they must be rare and have certainly

escaped our attention. This may well be the first strategic

donation of its kind. Indeed, it is very difficult to even think of

other hypotheticals where a firm could further its market position

by giving away its productive resources.

First, to have such a hypothetical one must have a donation

coupled with a condition that forecloses a significant market

share of a commercial product. The number of a donations

coupled with similar conditions 1s minor; the number that do so

in a way that forecloses a significant market share 1s minuscule

For example, even a donation of all of Hilton Head with a

condition prohibiting its use as a resort would not restrain trade

because it would not foreclose any significant share of the

market for resorts. Here, a huge 80% of the relevant market fo1

deposits were foreclosed to a monopolist’s only rival."”

Second, even in ihose cases where a firm does own land

controlling a significant market share of a commercial product,

it will rarely be the case that a firm can advance its market

position and restrain trade by giving that land away with

restrictive covenants. Normally, the best way for a firm to

further its market position and lessen competition is to retain

resources that confer a significant market share, not to give those

‘The market for vermiculite deposits in Virginia is the relevant market

because that 1s the only market to which a rival with its processing plant in

Virginia can turn given the high costs of transporting raw vermiculite. Se

7

App. 22a; JA 571-72. Moreover, even if the U.S. market were the relevant

yne. the restraints foreclosed 40% of U.S. vermiculite deposits. App. 4a

18

resources away. What makes this case different (and unusual) 1s

that here the controlling firm was a monopolist who had bought

up and suppressed the resources for twenty years, had never used

those resources or even built a processing plant in the same state

to make mining possible, and was now under an antitrust duty to

allow use by its rival unless it could somehow unload the

property to someone else. Such cases must be exceedingly rare.

Third, here the strategic anticompetitive purpose of the

donation was well-known to the preservationist group and patent

on the face of the donation. Why else insert documentary

provisions that prohibit vermiculite mining even when it does

not cause preservation problems and permit non-vermiculite

mining even when it does? See Statement of Facts. Few, if any,

donations are on their face so blatant about targeting a

nonopolist’s rival and prohibiting only dealings with that rival.

_ ny donation with such an obvious anticompetitive purpose and

effect clearly signals the recipient to decline it and its

anticompetitive conditions. There is no risk that prohibiting such

patently anticompetitive donative restraints would chill petitioner

or other charities from accepting normal donations.

Moreover, even if petitioner were correct that a nonprofit

should never be liable in antitrust for receiving a donation when

its Own purposes are purely noncommercial, this would be an

extremely poor test case to develop that proposition. For

petitioner does not meet its own proposed standard. Petitioner

was not acting only or mainly to further noncommercial purposes

-- petitioner had financially interests it was furthering. App. | la.

Namely, petitioner received hundreds of acres of land for joining

an antitrust scheme that also furthered the financial interests of

its members and management. /d.'* Certiorari review should

"Petitioner is correct that its financial interest should not determine whether

the restraint is commercial, for any nonprofit soliciting a donation has a

financial interest in getting that donation, Pet. 14, and the transaction here

would be commercial even if petitioner were financially disinterested. But

19

hardly be granted to consider adopting a legal standard that the

petitioner itself fails to satisfy.

In its own description of its pecuniary gain, Pet 17, petitioner

omits the fact that it resold some of the donated land for

monetary gain -- and remains free to sell the rest. App. 7a-8a,

lla. Petitioner knew that it would not get this land, and the

financial proceeds that followed, unless it joined a conspiracy

that it knew had an anticompetitive purpose and effect.

Petitioner also omits mentioning that purely preservationist

purposes cannot possibly explain the restraints actually agreed to

-- both because those restraints would have been unnecessary if

petitioner really would never allow vermiculite mining, App. 8a,

and because the restraints were deliberately modified to prohibit

vermiculite mining even when it does not cause preservation

problems and permitted non-vermiculite mining even when it

does cause preservation problems. See Statement of Facts.

Petitioner also suggests that the only financial benefit to its

management and members was the attenuated benefit of deriving

satisfaction from having the historic surroundings preserved. Pet

18. But maintaining property values by preventing nearby

mining is not at all an attenuated financial benefit -- it is large

and concrete. Moreover, the agreement here also directly

suppressed an increase in the local supply of marketable land that

otherwise would have lowered the market price of the land these

petitioner is wrong to suggest the Fourth Circuit issued a ruling that a

financial interest always makes a restraint commercial. The Fourth Circuit

merely held that, on the entire complex of facts, the restraint here was

commercial. Since petitioner below argued that it should be immune because

it was financially disinterested, it made sense to respond in part with the

observation that petitioner in fact had a strong financial interest. App. | la.

One need not believe a financial interest suffices to make a transaction

commercial to believe that it is surely commercial to have such a financial

interest in knowingly helping a monopolist evade an antitrust duty to deal and

foreclose a huge market share to its only rival through restraints patently

designed to target that rival rather than any charitable purpose.

20

management and members owned. This financial interest in

protecting the market price of their land from increased

competition is clearly not attenuated or noncommercial. Thus,

even if petitioner itself did not benefit financially, these financial

benefits to its management and members clearly suffice to hold

petitioner liable for joining an anticompetitive conspiracy. See

Hydrolevel, 456 U.S. at 573-74 (holding nonprofit liable even if

its agents benefitted themselves rather than the nonprofit).

In short, each piece of property petitioner received for

agrecing to join the anticompetitive scheme was either: (1) resold

to the direct financial gain of petitioner or (2) kept off the market

to maintain the market price of property owned by petitioner’s

management and members. The financial interest was plain.

These factors clearly suffice to make the challenged

agreement commercial. They also suffice to distinguish

petitioner’s parade of horribles, for hardly any donations of

preservation land to nonprofits will: (1) be coupled with

conditions that foreclose a significant market share, (2) evade an

monopolist-donor’s antitrust duty to deal, (3) further a donor’s

commercial motive in restraining trade that is known to the

nonprofit and blatant on the face of the donative restraint, and (4)

be motivated by the financial gain the nonprofit and its

management and members receives for joining in_ the

anticompetitive scheme. Except for odd cases that replicate the

unusual circumstances of this case, donations to preservationist

groups and other charities will be completely unaffected by the

decision below. When those unusual circumstances do exist, the

donative restraint is properly deemed commercial and

anticompetitive, and charities should know better than to join

such patently anticompetitive schemes.

Ill. The Argument That I.R.C. §170(h) Creates an

Implicit Exemption to the Antitrust Laws Was Not Preserved

on Appeal and Involves No Conflict in Lower Court

Authority. Before the Fourth Circuit, petitioner never raised the

21

rn

purported issue of whether I.R.C. §170(h) precludes the

application of federal antitrust law to its conduct. That purported

issue was raised only in an amicus brief, and was thus quite

properly never considered or discussed by the Fourth Circuit."

Having failed to properly preserve this issue on appeal, petitioner

cannot now raise it for the first time in this Court.

Further, even if petitioner had preserved the issue, petitioner

points to no conflict in judicial authority. Instead petitioner

alleges a conflict between the decision below and a statute,

L.R.C. §170(h). See Pet. 19 (claiming Fourth Circuit's

interpretation of the Sherman Act conflicts with §170(h).) But

this is not the sort of conflict approved as a ground for certiorari

review under U.S. SUPREME COURT RULE 10, which cites only

conflicts between judicial authority. And there is a very good

reason why Rule 10 does not include conflicts between a

decision and a statute. A claim of such conflicts is

indistinguishable from a claim that a particular court

misinterpreted the statute. If this Court were to become a court

of errors in every case involving a statutory interpretation, Its

docket would quickly be swamped by such cases. Thus, as Rule

10 plainly provides, this Court sensibly prefers to wait until

judicial authority conflicts on some federal question, including

the federal question of how to interpret a federal statute.

4 See, e.g., Bell v. Wolfish, 441 U.S. 520, 531 n. 13 (1979) (court has no

occasion to consider issue raised by amicus but not raised or preserved for

appeal by party); Knetsch v. United States, 364 U.S. 361, 370 (1960) (same),

Preservation Coalition v. Pierce, 667 F.2d 851, 861-62 (9th Cir.1982) (very

same amicus as in this case tried to raise issue not raised by parties; held 1t

cannot); Rhode Island v. Narragansett Indian Tribe, 19 F.3d 685, 705 n.22

(1st Cir.1994) (“In the court of appeals, amici cannot. . . introduce new issues

or issues not properly preserved for appeal.”); Corrosion Proof Fittings v

EPA. 947 F.2d 1201, 1208 (Sth Cir.1991) (court cannot consider issues raised

only by amici); United States v. Northeastern Pharmaceutical, 810 F.2d 726,

732 n.3 (8th Cir. 1986) (“Syntex, as amicus, cannot raise issues not raised by

the parties.”); 3 C.J.S. AMICUS CURIAE §3, at 1052 (“a new question raised

only in a brief filed by an amicus curiae . . . will not be considered.’ *)

>

[here is no such conflict in this case. Indeed. we are unable

to find any published opinion that has ever considered the issue

of a conflict between the Sherman Act and 8170(h) at all --

probably because, as described next, the issue is entirely bogus

IV. The Argument That I.R.C. §170(h) Creates an

Implicit Exemption to the Antitrust Laws Relies on a

Demonstrably False Premise About Tax Law, and Even If

Accurate About Tax Law Would Fail to Rebut the Strong

Presumption Against Implicit Antitrust Exemptions.

Petitioner’s purported conflict between the Sherman Act and the

[ax Code is bogus because it relies on a demonstrably false

premise about tax law. Petitioner’s premise is that, absent the

anticompetitive restraints Grace imposed on subsequent use of

the commercial property it donated, Grace would not have

received a tax deduction. Pet. 22. This premise is plainly false.

If one gives a charity some property -- be that property money,

a Monet painting, or a toxic waste dump that the charity resells --

that donation is deductible to the full market value of the donated

property. See I.R.C. §170(a), (c); §26C.F.R. 1.170A-1(c) (1999)

(amount of contribution measured by property’s market value).

A donor need not impose any restriction at all on the charity’s

use of the donated property to get the deduction. Any

restrictions are provided by the tax law defining a charity, which

guarantees that any proceeds from market value bestowed on a

charity will be used for charitable purposes

L.R.C. §170(h) deals with the entirely separate problem of

taxpayers who try to get a deduction when they give away a

partial property interest, like an easement on the property, and

retain the rest of the property. In those situations, the Tax Code

is quite sensibly worried about giving a tax deduction to a donor

who may not have really given away anything of value. The Tax

Code thus denies a charitable deduction in those cases, see I.R.C.

§ 1 70(f)(3), unless the donation meets certain exceptions like the

“qualified conservation contribution,” which is later defined in

Nm

LW

I.R.C. §170(h). The combination of §170(f)(3) and ILR.C

) 1 70(h) assures that donors who give partial property interests

lor a purported conservation purpose get a charitable tax

deduction only if they have imposed real restrictions on their use

of the retained property interest. By its express terms, §170(f)(3)

applies only to contributions that “consist of less than the

taxpayer's entire interest in such property.”” Thus, donors who

give away their entire interest in the property, as Grace did here.

do not fall within §170(f)(3), and need never meet the

requirements of I.R.C. §170(h).'* In short, the tax benefits to

Grace from its donation in no way hinged upon it imposing the

anticompetitive restraints prohibiting vermiculite mining by its

rivals

In any event, favorable tax treatment hardly provides an

exemption from antitrust law. Otherwise, firms could

horizontally fix prices of capital assets in order to create the

capital gains that tax law gives favorable treatment. A tax

subsidy for a general class of activities has never been thought to

implicitly repeal the application of antitrust law to particular

forms of that activities that are anticompetitive.

After all, as this Court has stressed: “our cases have

repeatedly established that there is a heavy presumption against

implicit exemptions” to antitrust law. Goldfarb v. Virginia Stat

Bar, 421 U.S. 773, 787 (1975). As one scholar put it:

[he Supreme Court’s rules for finding exemptions to

antitrust policy testify to the dominance of Sherman

\ct policy: the Court disclaims its authority to create

antitrust exemptions, see National Soc’y of

Professional Engr’s v. United States, 435 U.S. 679.

692 (1978), is reluctant to imply them, see National

it is irrelevant whether others have an interest in the same property. All

t matters is that Grace gave away all of the interest it had in the property

‘ ‘ - r —" ‘ seT hl 5 27\ L, . nea no

means its donation was not within 91 /0(1)(3) and thus not need not

;

(nh) to receive a tax dedu

t10n

24

Gerimedical Hosp. & Gerontology Center v. Blue

Cross, 452 U.S. 378, 388-89 (1981); and construes

express exemptions narrowly -- often remarkably so,

see, e.g., Group Life & Health Ins. Co. v. Royal Drug

Co., 440 U.S. 205 (1979).

Wiley, A Capture Theory of Antitrust Federalism, 99 HARV. L.

REV. 713, 713 n.1 (1986).

Accordingly, an antitrust exemption can be “implied only if

necessary to make the [non-antitrust statute] work, and even then

only to the minimum extent necessary.” Silver v. NYSE, 373 U.S.

341, 357 (1963) (emphasis added). That standard is clearly not

met here. I.R.C. §170(h) has nothing to do with the conduct in

this case. And even if it did, granting an antitrust exemption to

the conduct here would in no sense be necessary to make the tax

code work. For all the reasons stressed above, the conduct here

is extremely unusual and in no way implicates normal donations

or efforts to dedicate land for conservation. Providing antitrust

immunity to such unusual -- and manifestly anticompetitive --

conduct is thus not at all necessary to the law providing

favorable tax treatment for qualified conservation contributions,

which normally do not implicate antitrust law at all. Indeed,

there is no conflict even on the particular facts of this case since

the anticompetitive restraints attached to the donation in question

were entirely unnecessary to obtain the desired tax benefit.

This Court has repeatedly told parties that they must go to

Congress, not the courts, if they want a special exemption from

the Sherman Act. Patrick v. Burget, 486 U.S. 94, 105-06 (1988)

(physicians must ask Congress for exception to further medical

goals); Professional Eng'rs, 435 U.S. at 692, 695 (same for

public safety goals). Judges have neither the authority nor any

principled standards for undertaking the political task of

balancing the benefits of competition against its harm to other

social goals. If Congress wishes to prohibit vermiculite mining,

or grant a special antitrust exemption to groups opposed to such

mining, Congress may. But Congress has not done so, and thus

CONCLUSION