Opposition Brief — Anti-Monopoly, Inc. v. Hasbro, Inc.

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No. 97-1846 JUN 1 7 1998 |

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In The , is OF THE CLERK

Supreme Court of the United States “me

October Term, 1997

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ANTI-MONOPOLY, INC.,

Petitioner,

VS.

HASBRO, INC.,

Respondent.

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On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Second Circuit

4

BRIEF FOR RESPONDENT HASBRO, INC.

IN OPPOSITION TO PETITION

FOR WRIT OF CERTIORARI

a

Gary L. Repack Neat R. STOLL

Counsel of Record — Peter S. JULIAN

Davip J. BERGER SKADDEN, ARPS, SLATE,

MARTHE LAROSILIERE MEAGHER & FLOM

WiLson SONsSINI GOODRICH 919 Third Avenue

& Rosati New York, New York 10022

PROFESSIONAL CORPORATION (212) 735-3000

650 Page Mill Road

Palo Alto, California

94304-1050

(650) 493-9300

Counsel for Respondent

COCKLE LAW BRIEF PRINTING CO, (800) 225-6964

OR CALL COLLECT (402) 342-2831

TABLE OF CONTENTS

Page

pe 4 ete Oe eee her ore rar eee 1

PEARTINOUIEEE GEE BEER Rhea oi oi ee aces ievadeseies 2

I. THE CERTIORARI PETITION SHOULD BE

DENIED BECAUSE IT DOES NOT PRESENT A

G2 8g RR ees bis 8. SAR rene 5

Il. THE PETITION SHOULD BE DENIED BECAUSE

BOTH THE DISTRICT COURT AND THE

COURT OF APPEALS CORRECTLY APPLIED

THIS COURTS’ RULINGS AND THE DECI-

SIONS BELOW ARE NOT IN CONFLICT WITH

PA bgt io) (ot els ge err eee 7

CA mA AG b> oaks bi dea caine et ahessns 10

il

TABLE OF AUTHORITIES

Page

Cases |

Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) ..... 8

Associated General Contractors of California, Inc. v.

California State Council of Carpenters, 459 U.S.

PE CONE ckhw kn 55455 koh Goh bade eRe eeeNs 2, 8, 9

Atlantic Richfield Co. v. USA Petroleum Co., 495 U.S.

MEE SEONG how se spdameeesmnnee hace wee eeeaneeens 9

Brooke Group Ltd. v. Brown & Williamson Tobacco

Corp., SP US... TP GU ina cei ie gies 7,9

Celotex Corp. v. Catrett, 477 U.S. 317 (1986)........... 8

City of Oklahoma v. Tuttle, 471 U.S. 808 (1985) ........ 9

Goodman v. Lukens Steel Co., 482 U.S. 656 (1987) ..... 7

i

Greater Rockford Energy & Technology Corp. v. Shell |

Oil Co., 998 F.2d 391 (7th Cir. 1993), cert. denied,

Bk Mee ety Freer re, ah bearer ere ere ee a 9

Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,

Soe US. Sere CRE s kas A ccaccnestavicetheeneentnne xs 8

Monsanio Co. v. Spray-Rite Service Corp., 465 U.S.

Fak. GROW a 6 4 ik on aie ec ee 9

National Labor Relations Board v. Hendricks County

Rural -Electric Membership Corp., 454 U.S. 170

CRED son's vin 5 a eS Ene ea ke RAR OR ee Oe 6

Rebel Oil Co., Inc. v. Atlantic Richfield Co., 51 F.3d

1421 (9th Cir.), cert. denied, 516 U.S. 987 (1995) ..... y

Sullivan v. Taglhiabue, 25 F.3d 43 (1st Cir. 1994)........ 9

ill

TABLE OF AUTHORITIES - Continued

Page

Texas v. Mead, 465 U.S. 1041 (1984) citing United

States v. Johnston, 268 U.S. 220 (1925) .............. 6

Todorov v. DCH Healthcare Authority, 921 F.2d 1438

A is AG Asp hk a Ka ed ROK oe RE Re’ 9

STATUTES

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MISCELLANEOUS

a ae Oe ere eee er rere ere ere ers 5, 6, 8

INTRODUCTION

Anti-Monopoly, Inc.’s (“AMI” or “Petitioner”) Peti-

tion for a Writ of Certiorari requests that this Court

review the Second Circuit’s per curiam opinion, affirming

the district court’s order granting Hasbro, Inc. (“Hasbro”)

summary judgment on all of AMI’s claims. The district

court’s order was based upon the extensive and undis-

puted evidence demonstrating that (i) AMI’s board game,

ANTI-MONOPOLY, failed because consumers did not

like it, not because of any wrongdoing on the part of

Hasbro; and (ii) Hasbro never engaged in any illegal or

improper activity. Based upon this undisputed record, the

district court granted Hasbro’s motion for summary judg-

ment, finding that “[t]he distinct and significant problem

with all of AMI’s antitrust claims is that they lack factual

support in the record.” See 26a.!

The Court of Appeals for the Second Circuit carefully

reviewed AMI’s appeal of the district court’s findings

and order, and reached the same conclusion as the district

court. The Second Circuit thus affirmed per curiam, the

district court’s findings and judgment:

We have considered all of plaintiff’s challenges

to the district court’s rulings and have found in

them no basis for reversal. We affirm substan-

tially for the reasons stated in Judge McKenna’s

Memorandum and Order, reported at 958 F.

Supp. 895 (1997).

2a.

' Citations in the form “___a” refer to pages of the Appendix

to AMI’s Petition for Writ of Certiorari. No separate appendix

accompanies this Brief for Respondent in Opposition.

In its petition to this Court, AMI does not raise any

novel questions of fact or law, or claim that either the

district court or the Second Circuit misapplied existing

law. To the contrary, AMI concedes the correctness of the

lower courts’ key factual findings admitting for example,

that it “does not have any documents or testimony which

states that Hasbro did what it did to put AMI out of

business, or to stop sales of ANTI-MONOPOLY.” Petition

at 21-22. Rather, AMI’s petition is based upon its request

to this Court to reverse the last fifteen years of antitrust

law, beginning with this Court’s decision in Associated |

General Contractors of California, Inc. v. California State

Council of Carpenters, 459 U.S. 519 (1983). Because AMI’s

petition is devoid of any specific challenge to the lower

courts’ factual findings or legal reasoning, there is no

reason or need for this Court to further consider this case.

Accordingly, AMI’s Petition for a Writ of Certiorari

should be denied.

STATEMENT OF THE CASE

Petitioner, the manufacturer of the board game,

ANTI-MONOPOLY, filed this case in 1994 against Hasbro,

the second largest toy and game manufacturer in the

United States, as well as Toys “R” Us, Inc. and Kmart

Corporation, alleging a conspiracy among the three

defendants to block AMI from selling the ANTI-MONOP-

OLY board game in violation of Sections 1 and 2 of the

Sherman Act, 15 U.S.C. §§1-2, Sections 3 and 7 of the

Clayton Act, 15 U.S.C. §14; §18, and Section 2(a) of the

Robinson-Patman Act, 15 U.S.C. §13(a). Shortly thereafter,

the district court denied AMI’s motion for a temporary

RS

restraining order blocking Hasbro’s acquisition of certain

additional game titles. See 58a-6la. In June 1995, the

district court dismissed several of AMI’s facially invalid

claims (29a-50a), and a few months later Petitioner volun-

tarily dismissed with prejudice all of its claims against

the other two defendants in return for their production of

a few documents.

In the two years that followed, the district court

allowed AMI every opportunity to prove its case against

Hasbro. Petitioner propounded massive amounts of dis-

covery, including gaining access to more than 500,000

Hasbro documents, deposing and/or identifying more

than fifty individuals and obtaining documents from

numerous other companies in the toy and game industry.

Following the completion of this extensive discovery,

Hasbro moved for summary judgment.? In support of its

motion, Hasbro submitted the testimony of Petitioner’s

own distributors and customers, all of whom testified

that Petitioner’s game failed because consumers did not

like it and not because of anything done by Hasbro. The

undisputed evidence submitted also demonstrated that

Hasbro does not sell its products below cost and thus had

not engaged in predatory pricing; and that there are no

significant barriers to entry in Petitioner’s alleged market.

2 Prior to its summary judgment motion, Hasbro had

moved for partial judgment on the pleadings to dismiss AMI’s

secondary-line Robinson-Patman claims on the grounds that as

a competitor of Hasbro, AMI does not have antitrust standing to

pursue such claims. The district court agreed and granted the

motion at the time of its summary judgment ruling. See 22a at n.

10.

AMI’s opposition to Hasbro’s summary judgment

motion did not dispute this evidence. Indeed, despite its

exhaustive and all-encompassing search for evidence to

support its allegations, Petitioner did not (and could not)

come forward with any evidence of wrongdoing on the

part of Hasbro. Consequently, the district court, although

liberally construing all of the evidence in AMI’s favor

and giving AMI every conceivable doubt, held that:

To the extent that AMI might have antitrust

standing, it has failed to provide factual support

for its allegations of anticompetitive con-

duct... . Calling the evidence ambiguous would

be generous. AMI has not pointed to any

exhibits or non-hearsay testimony to support its

claim that Hasbro had an express or implied

agreement to fix prices with TRU or any other

retailer. ... The distinct and significant problem

with all of AMI’s antitrust claims is that they

lack factual support in the record. Accordingly,

all of AMI’s antitrust claims are dismissed.

24a-26a.3

* The district court also dismissed AMI’s one state law

claim for tortious interference with business advantage on the

grounds that Petitioner also failed to provide any factual

support for its state law claim. The court found that:

AMI has not set forth any particular business relation

with which Hasbro has interfered; nor has it set forth any

facts that Hasbro intended to harm AMI; nor has it set

forth facts to show that Hasbro used dishonest, unfair or

improper methods to compete with AMI. Accordingly,

AMI’s state law claim is dismissed with prejudice.

See 27a (footnote omitted).

— ez

. =

AMI’s appeal to the Second Circuit was again long on

rhetoric but entirely devoid of any evidence to support its

allegations, or any claim that the district court had misap-

plied existing law. The Second Circuit carefully scruti-

nized AMI’s appeal as well as the extensive undisputed

factual record developed in the district court. Following

lengthy briefing (which included a three-volume appen-

dix of exhibits, consisting of more than 2500 pages of

testimony), the court of appeals affirmed the district

court’s order in a per curiam opinion. The Second Circuit

panel held that it had “considered all of plaintiff’s chal-

lenges to the district court’s rulings and . . . found in

them no basis for reversal.” See 2a.

AMI’s petition does not challenge these findings;

rather, it concedes them. Petitioner admits that it “does not

have any documents or testimony which states that

Hasbro did what it did to put AMI out of business, or to

stop sales of ANTI-MONOPOLY.” Petition at 21-22.

I. THE CERTIORARI PETITION SHOULD BE

DENIED BECAUSE IT DOES NOT PRESENT A

COMPELLING QUESTION.

This Court has stated that a petition for a writ of

certiorari will be granted only for “compelling reasons.”

Sup. Ct. R. 10. For this reason alone, AMI’s certiorari

petition should be denied. There is absolutely no signifi-

cant or compelling legal issue raised by the decisions of

the lower courts in this case which merit this Court’s

attention. Rather, the district court as well as the Second

Circuit closely scrutinized the undisputed evidence pre-

sented and found that “[t]he distinct and significant

problem with all of AMI’s antitrust claims is that they

lack factual support in the record.” See 26a. See also 2a. In

doing so, the courts below did not adopt a new construc-

tion or declare a new rule of law that conflicts with

decisions of this Court or with those in any other circuits

- the general motivating factor in this Court’s exercise of

certiorari jurisdiction. Sup. Ct. R. 10.

This Court has also long held that it will not grant

certiorari when the review sought turns solely upon an

analysis of the particular facts of the case rather than

some clear overriding legal controversy. See Texas v. Mead,

465 U.S. 1041, 1043 (1984) (Stevens, J.) citing United States

v. Johnston, 268 U.S. 220, 227 (1925) (“We do not grant a

certiorari to review evidence and discuss specific facts.”);

National Labor Relations Board v. Hendricks County Rural

Electric Membership Corp., 454 U.S. 170, 176, n. 8 (1981)

(Court dismisses writ of certiorari as “improvidently

granted” because it was “presented primarily with a

question of fact which does not merit Court review”). See

also Sup. Ct. R. 10 (“[a] petition for a writ of certiorari is

rarely granted when the asserted error consists of erro-

neous factual findings or the misapplication of a properly

stated rule of law”). There is no legal controversy present

in this matter. Nowhere in the certiorari petition does

AMI discuss or even mention any possible legal errors in

the judgments below. Rather, Petitioner urges the Court

to review the case based on AMI’s unsupported allega-

tions — not the record below, which AMI does not cite or

discuss - and AMI’s argument that the Court should

reverse the last fifteen years of antitrust law. See, e.g.,

Petition at 16, 19-20 (urging reversal of this Court's deci-

sion in Brooke Group, Ltd. v. Brown & Williamson Tobacco

Co., Inc., 509 U.S. 209 (1993)).

This Court has been even more reluctant to review

factual issues where the court of appeals has confirmed a

district court’s findings. In such instances, the petitioner

must make an extraordinarily clear showing of error

before certiorari is granted. As stated by this Court in

Goodman v. Lukens Steel Co., 482 U.S. 656 (1987):

[With] both courts below having agreed on the

facts, we are not inclined to examine the record

ourselves absent some extraordinary reason for

undertaking this task. ... A court of law such as

this Court . . . cannot undertake to review con-

current findings of fact by two courts below in

the absence of a very obvious and exceptional

showing of error.

Id. at 665 (citations omitted). AMI’s certiorari petition,

completely devoid of citations to any admissible evi-

dence, does not even begin to come close to making an

“exceptional showing of error” which would warrant this

Court’s departure from its established guidelines.

Il. THE PETITION SHOULD BE DENIED BECAUSE

BOTH THE DISTRICT COURT AND THE COURT

OF APPEALS CORRECTLY APPLIED THIS

COURTS’ RULINGS AND THE DECISIONS

BELOW ARE NOT IN CONFLICT WITH ANY

OTHER CIRCUIT.

This Court has made clear that a guiding consider-

ation for review of a case that has been decided by a

United States court of appeals is the existence of a conflict

between the decision in question and another decision

rendered by another court of appeals or a state court of

last resort. See Sup. Ct. R. 10(a). Alternatively, review may

be granted where the court of appeals has decided “an

important federal question in a way that conflicts with

relevant decisions of this Court.” Sup. Ct. R. 10(c).4 The

Second Circuit’s per curiam affirmance of the district

court’s order granting summary judgment in this case

does not give rise to any sort of conflict which calls for

the Court to exercise its supervisory power. The district

court’s decision (and the Second Circuit’s affirmance),

involved a detailed and thorough review of the un-

disputed evidence presented and application of well-

established legal principles to the factual record. See 2a;

3a-28a. In other words, the courts below employed the

normal standard of review prescribed by this Court in

Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Matsushita

Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986);

and Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986), in

deciding on Hasbro’s summary judgment motion.

The lower courts also adhered scrupulously to this

Court’s substantive antitrust rulings. The district court

meticulously applied this Court’s holding in Associated

General Contractors of California, Inc. v. California State

4 This Court has also stated that it may choose to exercise

certiorari jurisdiction when a court of appeals has “decided an

important question of federal law that has not been, but should

be settled by this Court.” Sup. Ct. R. 10(c). There is no new or

unsettled legal issue arising out of this matter. As discussed

further below, the lower courts simply applied this Court’s

stated rules of law in deciding a summary judgment motion in

the antitrust context.

Ee TT ST TO OM TE I ae

Council of Carpenters, 459 U.S. 519 (1983), in finding that

AMI did not have antitrust standing (see 21a-24a); it

relied on this Court’s Brooke Group Ltd. v. Brown & Wil-

liamson Tobacco Corp., 509 U.S. 209 (1993) and Atlantic

Richfield Co. v. USA Petroleum Co., 495 U.S. 328 (1990),

decisions in finding that AMI cannot sustain a claim for

predatory pricing (see 23a-24a); and finally, the district

court looked to Monsanto Co. v. Spray-Rite Service Corp.,

465 U.S. 752 (1984), when it held that AMI’s antitrust

conspiracy charges failed as a result of a lack of any

admissible evidence (24a-25a). All of these rulings were

reviewed and affirmed by the Second Circuit. See 2a.

Similarly, the district court’s ruling and the Second

Circuit’s affirmance are not in conflict with any other

circuit courts’ decisions on any of these issues. See, e.g.,

Rebel Oil Co., Inc. v. Atlantic Richfield Co., 51 F.3d 1421 (9th

Cir.), cert. denied, 516 U.S. 987 (1995) (only a disfavored

purchaser has standing to claim a secondary-line injury);

Sullivan v. Tagliabue, 25 F.3d 43 (1st Cir. 1994) (applying

Associated General Contractors’ factors to determine if

plaintiff has antitrust standing); Greater Rockford Energy &

Technology Corp. v. Shell Oil Co., 998 F.2d 391 (7th Cir.

1993), cert. denied, 510 U.S. 1111 (1993) (party asserting

antitrust conspiracy must proffer evidence of such);

Todorov v. DCH Healthcare Authority, 921 F.2d 1438 (11th

Cir. 1991) (plaintiff’s antitrust claims fail because he had

no standing and suffered no antitrust injury).

In short, this case does not warrant this Court’s time

and attention as the law is well established and the lower

courts’ decisions correctly applied that law to the exten-

sive and undisputed factual record. See City of Oklahoma v.

Tuttle, 471 U.S. 808, 815-16 (1985) (the “decision to grant

10

certiorari represents a commitment of scarce judicial

resources”). Nothing in AMI’s certiorari petition is to the

contrary.

CONCLUSION

For the reasons set forth above, Respondent, Hasbro,

Inc., respectfully requests that the Petition for Writ of

Certiorari be denied.

June 17, 1998

Respectfully submitted,

Gary L. REBACK Neav R. STOLL

Counsel of Record Peter S. JULIAN

Davip J. BERGER SKADDEN, ARPS, SLATE,

MArTHE LAROSILIERE MEAGHER & FLOM

Witson SONsINI GOODRICH 919 Third Avenue

& Rosati New York, New York 10022

PROFESSIONAL CORPORATION (212) 735-3000

650 Page Mill Road

Palo Alto, California

94304-1050

(650) 493-9300

Counsel for Respondent