Opposition Brief — Massachusetts School of Law at Andover, Inc. v. American Bar Ass'n

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No. 96-1898 JUN 30 1997

IN THE oe .

Siyreme Court of the United States

OCTOBER TERM, 1996

MASSACHUSETTS SCHOOL OF LAW AT ANDOVER, INC.,

_ Petitioner,

AMERICAN BAR ASSOCIATION, et al.,

Respondents.

On Petition for Writ of Certiorari to the

United States Court of Appeals

for the Third Circuit

BRIEF IN OPPOSITION OF RESPONDENT

AMERICAN BAR ASSOCIATION

CARTER G. PHILLIPS DAVID T. PRITIKIN *

SIDLEY & AUSTIN DAVID R. STEWART

1722 Eye Street BRUCE M. ZESSAR

Washington, D.C. 20006 SIDLEY & AUSTIN

(202) 736-8000 One First National Plaza

Chicago, Illinois 60603

BARBARA W. MATHER

(312) 853-7000

L. SUZANNE FORBIS

PEPPER HAMILTON &

SCHEETZ

3000 Two Logan Square

18th and Arch Streets

Philadelphia, Pennsylvania 19103

(215) 981-4000

Counsel for Respondent American Bar Association

June 30, 1997 * Counsel of Record

WILSON - EPES PRINTING Co., INC. - 789-O096 - WASHINGTON, D.C. 20001

QUESTIONS PRESENTED

1. Whether the courts below properly held that re-

spondent American Bar Association was entitled to sum-

mary judgment dismissing petitioner’s claim under 15

U.S.C. §§ 1-2 where (a) petitioner sought to hold re-

spondent liable for alleged injuries caused by the actions

of the states applying their own bar admission rules, (b)

petitioner sought to hold respondent liable for an alleged

“stigma” incidental to respondent’s successful efforts to

influence state bar admission decisions, and (c) peti-

tioner failed to raise a genuine issue of material fact

relating to the additional direct injuries allegedly caused

by respondent?

2. Whether the court of appeals properly held (a) that

the district court did not abuse its discretion in denying

petitioner certain discovery that was not material to the

grounds on which the court entered summary judgment,

and (b) that the district court did not abuse its discre-

tion in partially disqualifying three of petitioner’s faculty

members from performing certain functions as counsel for

petitioner?

(i)

LIST OF PARTIES AND AFFILIATES

The caption of the case in this Court and the list on

page ii of the petition contain the names of all parties.

Respondent American Bar Association is a not-for-profit

corporation organized under the law of Illinois. Pursuant

to S. Ct. Rule 29.6, the American Bar Association states

that it has no parent or subsidiary companies.

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ........-.............-..2.-....-.- i

LIST OF PARTIES AND AFFILIATES .....2..2........ ii

ee SOR Bi 8g. SS ec iv

COUNTERSTATEMENT OF THE CASE ..._.........._.... 2

REASONS FOR DENYING THE PETITION ......_._... 7

SEER TE TE EPEAT ED a SO 18

(iii)

TABLE OF AUTHORITIES

Cases Page

Allied Tube & Conduit Corp. v. Indian Head, Inc.,

GR TEE, BO Ce wcities dcicctinans 10, 18-14

California Retail Liquor Dealers Ass’n v. Midcal

Aluminum, Inc., 445 U.S. 97 (1980) .......-.......-..- 10

Cantor v. Detroit Edison Co., 428 U.S. 579 (1976) .. 10

City of Columbia v. Omni Outdoor Advertising,

Fb, GRO Vids We CRED wide 9, 16-17

Consolidated Metal Prods., Inc. v. American Petro-

leum Inst., 846 F.2d 284 (5th Cir. 1988) .............. 13

Eastern R.R. Presidents Conf. v. Noerr Motor

Freight, Inc., 365 U.S. 127.(1961) .................. 6, 9, 11-12

Federal Trade Comm’n v. Ticor Title Ins. Co., 504

ts Ce Ne heii taeda. ~ sebiniidantecencinnncicanoeiee 10

Hoover v. Ronwin, 466 U.S. 558 (1984) cael 8,9, 11,17

In re Hansen, 275 N.W.2d 790 (Minn. 1978), cert.

Geoeeted,, GEE TEA. Te CECI ice snccsesceicecencicceces- 8

In re Massachusetts School of Law, Docket No.

SJC-280 (Me. Dec. 24, 1996) ................-........-... 3

In re Murphy, 398 A.2d 369 (Pa. 1978), cert.

denied, 440 U.S. 901 (1979) .........-..........0....2..... 8

Lawline v. American Bar Ass’n, 956 F.2d 1378

(7th Cir. 1992), cert. denied, 510 U.S. 992

TIED sncatdiniedieniiadihchesceincsstepasantonnadicechetatibashaieiliidlag atte cats tin 9

Litton Systems, Inc. v. American Tel. and Tel. Co.,

ope & Bt kt Me Ree 10

Massachusetts School of Law at Andover, Inc. v.

American Bar Ass'n, No. 95-12320-MEL, 1997

U.S. Dist. LEXIS 7033 (D. Mass. May 8, 1997)... 5-6

Massachusetts School of Law at Andover, Inc. v.

American Bar Ass’n, No. 95-12320-MEL, 1997

U.S. Dist. LEXIS 3430 (D. Mass. Mar. 3, 1997) .. 6

Parker v. Brown, 317 U.S. 341 (1948) -....-....0....... 9

Patrick v. Burget, 486 U.S. 94 (1988) —........-......... 10

Potter v. New Jersey Supreme Court, 403 F. Supp.

1036 (D.N.J. 1975), aff’d, 546 F.2d 418 (3d Cir.

] | RRR DET aRC es Se! ot ED oer Re hes LY ee 8

Sanjuan v. American Bd. of Psychiatry & Neurol-

ogy, Inc., 40 F.3d 247 (7th Cir. 1994), cert. de-

nied, 116 S. Ct. 1044 (1996) ..........02..02 2. 13

TABLE OF AUTHORITIES—Continued

Page

Schachar v. American Academy of Ophthalmology,

Inc., 870 F.2d 397 (7th Cir. 1989) -..........20..2000022.. 13

Sessions Tank Liners, Inc. v. Joor Mfg., Inc., 17

F.3d 295 (9th Cir.), cert. denied, 513 U.S. 813

| ROR ere RS 5 AO eet hea RE 9, 10, 13, 16

Sherman College of Straight Chiropractic v.

American Chiropractic Ass’n, 654 F. Supp. 716

(N.D. Ga. 1986), aff’d, 813 F.2d 349 (11th Cir.),

cert. denied, 484 U.S. 854 (1987) .......2000.e eee. 9

United Mine Workers v. Pennington, 381 U.S. 657

EE iccs hadi nang a ag IAMaA cibetacc tlk iadheansidansotervadeotonin 9

United States v. American Bar Ass’n, 934 F. Supp.

Se ee HI aiacietoetcccnccedtndsilercneilaziconsinniienes 15

United States v. Microsoft Corp., 56 F.8d 1448

BF eRe ear ner 16

Virginia Academy of Clinical Psychologists v. . Blue

Shield of Va., 624 F.2d 476 (4th Cir. 1980)........ 10

Zavaletta v. American Bar Ass’n, 721 F. Supp. 96

SI I as eads 9

Statutes

I ie a in, cease hia sdacaiia aidan i, 5

ee I aii tadashi tactile ndilecdiciidaiianieicsnsenss i,5

Ee IE icsnicctsicieanaceiinicdvetavinneonaieiaiihebeionintias 16

IN THE

Supreme Court of the United States

OCTOBER TERM, 1996

No. 96-1898

MASSACHUSETTS SCHOOL OF LAW AT ANDOVER, INC.,

‘ Petitioner,

AMERICAN BAR ASSOCIATION, et al.,

Respondents.

On Petition for Writ of Certiorari to the

United States Court of Appeals

for the Third Circuit

BRIEF IN OPPOSITION OF RESPONDENT

AMERICAN BAR ASSOCIATION

Respondent American Bar Association (“ABA”) re-

spectfully submits this brief in opposition to the petition

for a writ of certiorari filed by petitioner Massachusetts

School ot Law at Andover, Inc. (“MSL”). The petition

should be denied for the following reasons: (1) the de-

cision of the court of appeals does not conflict with any

decision of this Court or other courts of appeals and, in

any event, is entirely correct; and (2) the petition rests on

mere disagreements with the lower courts’ conclusion that

petitioner failed to raise a genuine issue of material fact

relating to its claims and on the courts’ alleged misappli-

cation of properly stated rules of law to the factual record.

COUNTERSTATEMENT OF THE CASE

1. The ABA is a non-profit professional organization

of attorneys whose membership is open to members of

the bar of the 50 states and the territories of the United

States, including graduates of law schools not accredited

by the ABA. (Pet. App. 5A-7A; C.A. App. 1338, 3377.)

Legal education and bar admissions have been a central

concern of the ABA since its founding in 1878. (Pet.

App. 6A; C.A. App. 2957-58.) Under the direction of

Elihu Root, Chair of the ABA Section of Legal Educa-

tion and Admissions to the Bar (the “Section”) during

1920-22, the ABA first developed a set of accreditation

standards establishing minimum criteria for programs of

legal education. (Pet. App. 6A; C.A. App. 49, 2957-58.)

Since that time, the ABA has petitioned the highest

court in each state to rely on ABA accreditation decisions

in connection with bar admission decisions, and it con-

tinues regularly to communicate its opinions concerning

accreditation and bar admission matters to the states.

(Pet. App. 6A; C.A. App. 2958, 3618-19, 3623-53.) For

example, the ABA informs state supreme courts and state

boards of bar examiners of its accreditation decisions and

annually sends them a list of all law schools accredited

by the ABA. (Pet. App. 6A; C.A. App. 3618-19.) Asa

result of these efforts, under the bar admission rules of all

50 states and the District of Columbia, graduation from an

ABA-accredited law school satisfies the legal education

requirement for admission to the bar. (Pet. App. 6A; see

also C.A. App. 1396-1409.)?

1In addition, the Council of the Section has been recognized since

1952 by the U.S. Secretary of Education and his predecessors “as

the national agency for accreditation of professional schools of law”

and a “reliable authority” concerning the quality of legal education.

(Pet. App. 6A; C.A. App. 3378.)

Numerous states recognize other ways of satisfying the

legal education requirement for bar admission, and an

individual applicant or law school can, in each state,

petition for revision or waiver of state bar admission

rules. (See Pet. App. 6A-7A; C.A. App. 1396-1409.)

For example, the New Hampshire Supreme Court and the

Maine Supreme Judicial Court have granted petitions

filed by MSL to allow its graduates to take the bar exami-

nation in those states, even though the courts’ rules require

bar applicants to graduate from an ABA-accredited law

school. (Pet. App. 7A; C.A. App. 3168; In re Massa-

chusetts School of Law, Docket No. SJC-230 (Me. Dec.

24, 1996). In addition, petitions allowing individual MSL

graduates to take the bar examination have been granted

in the District of Columbia and Maryland. (Pet. App.

7A; C.A. App. 3484.) -All told, MSL graduates can

take the bar examination immediately after graduation in

California, Maine, Massachusetts, New Hampshire, Ver-

mont, and West Virginia and, in 12 other states, after

practicing for a prescribed period in another jurisdiction.

(Pet. App. 7A; C.A. App. 3483-84.)

2. Accreditation by the ABA is voluntary and open

to any law school that submits an application to the ABA.

(Pet. App. 7A; C.A. App. 3378.) The ABA grants pro-

visional accreditation to applicant law schools that sub-

stantially comply with the ABA’s accreditation standards

and give assurance that they will be in full compliance

within three years. (Pet. App. 7A; C.A. App. 845.)

During the time period relevant to this case, there were

177 ABA-accredited law schools in the United States,

as well as over 50 schools, including MSL, that were not

ABA-accredited but had received some form of approval

from individual states. (Pet. App. 6A.)

3. MSL conducted its first classes in 1988. (Id. at

SA; C.A. App. 917.) In May 1990, MSL received au-

thority from the Board of Regents of the Commonwealth

of Massachusetts to award the juris doctor to its gradu-

ates. (C.A. App. 2.) That authority enables MSL’s

graduates to take the bar examination in Massachusetts

and several other states. (C.A. App. 12-13; 3483.)

MSL applied to the ABA for accreditation in the fall

of 1992 and early 1993. (Pet. App. 9A.) In connection

with its application, MSL demanded that the ABA grant a

wholesale waiver relieving MSL from complying with the

ABA’s accreditation standards. (/d. at 9A-10A; C.A.

App. 845-47, 4065.) In a letter to MSL’s trustees written

shortly before submitting its application, MSL’s dean out-

lined his strategy to gain accreditation without complying

with the ABA’s accreditation standards. (C.A. App.

3441-58.) In that letter, the dean set forth his con-

viction that if the ABA “is given reason to believe it

is facing a tiger, it will seek to quickly come to a reason-

able accommodation with MSL—it will probably, in fact,

give way to most or all of our views.” (Jd. at 3452-53.)

MSL’s strategy was premised on the dean’s belief that

the ABA would be financially vulnerable to a sustained,

expensive litigation attack:

Perhaps the most important fact I learned at the

ABA convention in Dallas is this: The ABA ran

a deficit of two million dollars last year, and is in

desperation about insufficient revenues. .. .

The ABA’s financial straits are crucially important be-

cause . . . the lawyers needed to defend serious law-

suits cost a small fortune. The ABA will not want

and cannot afford the heavy fees it would have to

spend to defend against a suit by MSL. The ABA’s

counsel . . . will advise the ABA to expect to have to

fund a war if MSL sues. . . . Given the financial

straits the ABA is in, I do not believe it will want

any part of this.

(Id. at 3456.) By August 1994, after only six years in

operation, MSL had amassed a war chest—through annual

surpluses funded out of tuition paid by MSL students—of

approximately $7 million to fund its litigation with the

ABA. (C.A. App. 1203-04.)

The ABA considered MSL’s application for accredita-

tion in accordance with the ABA’s established procedures.

(See Pet. App. 10A.) Pursuant to these procedures, the

ABA conducted a site evaluation of MSL, and MSL sub-

mitted extensive information to the ABA in support of

its application including, among other things, written re-

sponses to the site evaluation report and the recommenda-

tions of the Accreditation Committee and the Council of

the Section. (C.A. App. 50-51, 693-792, 905-06, 911-91.)

In addition, representatives of MSL appeared before the

Accreditation Committee, the Council and the House of

Delegates. (C.A. App. 50-51, 837-38, 905-06, 3385.)

Ultimately, the ABA denied MSL’s application based on

MSL’s failure to comply with the ABA’s accreditation

standards in eleven substantive respects. (See C.A. App.

45-47, 845-46, 905-09, 3385.)

MSL commenced this action on November 23, 1993,

alleging that defendants violated Sections 1 and 2 of the

Sherman Act. 15 U.S.C. §§ 1-2. (C.A. App. 24-25.)

After an extended period of discovery during which MSL

took 32 depositions and respondents produced over 70,000

pages of documents, Massachusetts Sch. of Law at

Andover, Inc. v. American Bar Ass'n, No. 93-6206 at 2

(E.D. Pa. July 29, 1996), the ABA filed a motion for

summary judgment seeking dismissal of MSL’s claims.”

2 While the ABA’s summary judgment motion was pending, MSL

filed a second lawsuit in Massachusetts state court asserting claims

for breach of contract, misrepresentation and unfair trade practices

against the ABA, AALS and 14 individuals, including 12 of the de-

fendants in this action. That lawsuit, which also arose out of the

ABA’s denial of MSL’s application for accreditation, was subse-

quently removed to the United States District Court for the District

of Massachusetts. Earlier this year, the court entered summary

judgment dismissing MSL’s claims against all defendants. Massa-

chusetts Sch. of Law at Andover, Inc. v. American Bar Ass’n, No.

On August 30, 1996, the district court entered summary

judgment dismissing MSL’s claims. (Pet. App. 43A-

66A.)* The court held, based on Eastern R.R. Presidents

Conf. v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961),

and the record evidence, that MSL failed to establish that

it had suffered a cognizable antitrust injury. (Pet. App.

47A-65A.)

The court of appeals unanimously affirmed, concluding,

as the district court had found, that “MSL has failed to

demonstrate an injury for which antitrust liability may

lie, . . . .” (Pet. App. 35A.) Specifically, the court

held that MSL could not, as a matter of law, recover

damages for any of the three types of injury that it alleged

were caused by the ABA’s actions. First, the court held

that defendants were immune from antitrust liability for

injury allegedly suffered as a result of decisions by the

states that graduates of law schools not accredited by the

ABA may not be admitted to the bar. (Jd. at 20A-24A.)

Second, the court held that defendants could not be liable

for an alleged “stigma” or “loss of prestige” arising from

the ABA’s decision to deny MSL’s application for accredi-

tation. The court held that the alleged injury was inci-

dental to the ABA’s efforts to petition the states in con-

95-12320-MEL, 1997 U.S. Dist. LEXIS 7033 (D. Mass. May 8, 1997)

(entering summary judgment for ABA and individual defendants) ;

Massachusetts Sch. of Law at Andover, Inc. v. American Bar Ass'n,

No, 95-12320-MEL, 1997 U.S. Dist. LEXIS 3480 (D. Mass. Mar. 3,4

1997) (entering summary judgment for AALS).

3 The individual defendants named in the complaint had previously

been dismissed by the district court for lack of personal jurisdiction.

Massachusetts Sch. of Law at Andover, Inc. v. American Bar Ass’n,

846 F. Supp. 374 (E.D. Pa. 1994). The other defendant organiza-

tions, the Association of American Law Schools, Inc. (“AALS”)

and the Law School Admission Council and Law School Admission

Services, Inc. (“LSAC/LSAS”), moved for summary judgment as

well. Upon entering summary judgment in favor of all defendants,

the court dismissed the separate motions filed by AALS and LSAC/

LSAS as moot. (Pet. App. 66A.)

nection with bar admission decisions. (Jd. at 24A-28A.)

Third, the court held that MSL had failed to come for-

ward with evidence sufficient to raise a genuine issue of

material fact that it had been injured by enforcement of

ABA accreditation standards concerning faculty salaries,

transfer credits, and admission into post-J.D. degree pro-

grams. (Id. at 28A-33A.) The court of appeals also

found that the district court did not abuse its discretion

in its discovery rulings or in its order disqualifying

certain MSL faculty members from acting as trial counsel,

giving oral argument, and taking depositions. (Jd. at

14A-18A, 41A-42A.)

REASONS FOR DENYING THE PETITION

Contrary to MSL’s assertion that the decision of the

court of appeals “establishes a sweeping new antitrust

immunity” (Pet. 13), the court simply applied well-settled

principles of law to the unique facts of this case. The

primary injury for which MSL sought recovery in the

district court was an alleged loss of enrollment and tuition

income due to the inability of its graduates to take the

bar examination in particular states. (See C.A. App. 2,

12-14, 15-17, 19, 20, 22-24.) The decision of the court

of appeals that the ABA cannot be held liable for bar

admission decisions made by the states creates no con-

flict with the decisions of this Court or other courts of

appeals.

In addition to this primary alleged injury, MSL offered

alternative theories of recovery during the course of the

litigation. Under its second theory, MSL sought to re-

cover damages for an alleged “stigma” arising from the

ABA’s decision to deny MSL’s application for accredita-

tion. Once again, the decision of the court of appeals

that the alleged “stigma” was incidental to the ABA’s

efforts to influence state bar admission decisions creates

no conflict with the decisions of this Court or other courts

of appeals.

Finally, MSL asserted late in the litigation that it had

suffered direct injury as a result of the ABA’s enforcement

of its accreditation standards concerning faculty salaries,

transfer credits and admission into post-J.D. degree pro-

grams. Both the district court and the court of appeals

concluded that MSL failed to come forward with suffi-

cient evidence to raise a genuine issue of material fact

that it had been injured by those accreditation standards.

MSL’s mere disagreement with the factual determinations

of the lower courts provides no basis for granting the

petition.

1. MSL may not recover from the ABA for injury

allegedly suffered as a result of the actions of the states.

MSL seeks to hold the ABA liable for the decisions of

state supreme courts that graduates of law schools not

accredited by the ABA may not be admitted to the bar.

As the court of appeals found (Pet. App. 20A), it is well

established that each state possesses “the authority to

decide what applicants may take its bar examination and

may be admitted to the bar.” See, e.g., Hoover v. Ronwin,

466 U.S. 558, 569 (1984) (“Pursuant to the State Con-

stitution the Arizona Supreme Court has plenary authority

to determine admissions to the bar”).* It is similarly well

settled that economic consequences flowing directly from

restraints imposed by the operation of state law fall out-

* See also, e.g., In re Murphy, 393 A.2d 369, 371, 374 (Pa. 1978)

(authority over bar admission “exercised [] exclusively by the

Supreme Court’’), cert. denied, 440 U.S. 901 (1979); In re Hansen,

275 N.W.2d 790, 796 (Minn. 1978) (“We have not delegated our

authority to the ABA but, instead, have simply made a rational

decision to follow the standards of educational excellence it has

developed”), cert. denied, 441 U.S. 938 (1979) ; Potter v. New Jersey

Supreme Court, 403 F. Supp. 1036, 1040 (D. N.J. 1975) (state’s

adoption of “the standards of an approving body does not support

a conclusion that such adoption is an abrogation or delegation of

the power or duty to supervise the practice of law in this State”),

aff'd, 546 F.2d 418 (3d Cir. 1976).

side the scope of the Sherman Act. Parker v. Brown,

317 U.S. 341, 352 (1943); Hoover, 466 U.S. at 573-74.

MSL may not circumvent this principle by suing private

parties, such as the ABA, whose views have influenced

the state action at issue. Noerr, 365 U.S. at 135-36;

United Mine Workers v. Pennington, 381 U.S. 657, 670-

71 (1965). As this Court observed in City of Columbia

v. Omni Outdoor Advertising, Inc., 499 U.S. 365, 383

(1991), “Parker and Noerr are complementary expres-

sions of the principle that the antitrust laws regulate busi-

ness, not politics; the former decision protects the States’

acts of governing, and the latter the citizens’ participation

in government.”

The decision of the court of appeals affirming dismissal

of MSL’s claims on this issue represents a straightforward

application of well-settled law that is consistent with the

decisions of other courts of appeals.® For example, in

Sessions Tank Liners, Inc. v. Joor Mfg., Inc., 17 F.3d

295 (9th Cir.), cert. denied, 513 U.S. 813 (1994), the

defendant convinced a private association to amend its

code in such a way as to exclude use of the plaintiff

competitor’s product in those municipalities that relied

on the code. The court held that the defendant was

immune from antitrust liability because the plaintiff's

alleged injuries “flowed directly from government action,”

even in those markets where the government had not

5 See also Lawline v. American Bar Ass’n, 956 F.2d 1378 (7th Cir.

1992) (holding ABA not liable for antitrust injury resulting from

state supreme court’s adoption of ethical standards developed by

ABA), cert. denied, 510 U.S. 992 (1993); Sherman College of

Straight Chiropractic v. American Chiropractic Ass’n, 654 F. Supp.

716, 722-23 (N.D. Ga. 1986) (holding accreditor immune from anti-

trust liability for injury arising from state decisions to deny licenses

to graduates of unaccredited schools), aff'd, 813 F.2d 349 (11th

Cir.), cert. denied, 484 U.S. 854 (1987). See also Zavaletta v.

American Bar Ass’n, 721 F. Supp. 96 (E.D. Va. 1989) (dismissing

antitrust claims of students at unaccredited law school based on

Noerr doctrine).

eae a ne

adopted, but merely relied on, the code. Id. at 299. Con-

versely, Allied Tube & Conduit Corp. v. Indian Head,

Inc., 486 U.S. 492 (1988), on which MSL heavily relies

(see Pet. 19-23), is inapposite because the Court ex-

plicitly excluded from consideration any injury resulting

from government action. 486 U.S. at 498 n.2, 500.

As the court of appeals observed, MSL has identified

no judicial authority supporting a conclusion to the con-

trary. (Pet. App. 22A-24A & n.8.) Nor did the US.

Department of Justice, in its amicus brief filed in the court

of appeals, question the lower court’s holding on this

issue. (Brief of Amicus Curiae United States at 9-10

(Oct. 28, 1996) (taking no “position on the district

court’s holding that MSL cannot recover for any injury it

suffered as a result of state decisions to adopt ABA

standards”), Massachusetts Sch. of Law at Andover, Inc.

v. American Bar Ass'n, 107 F.3d 1026 (3d Cir. 1997)

(No. 96-1792) [hereinafter (“Gov. Br.”)].)

MSL’s reliance on a line of cases holding that anti-

competitive restraints directly imposed by private parties

are not immunized by state authorization of that conduct

is similarly unavailing. As the court of appeals observed,

each of those cases involved private restraints of trade

that were self-executing—independent of state law—and

led directly to the alleged antitrust injury. (See Pet. App.

22A.)° In each of those cases, the Court rejected the

6 See Federal Trade Comm’n v. Ticor Title Ins. Co., 504 U.S. 621,

627 (1992) (private price-fixing agreement); Patrick v. Burget,

486 U.S. 94, 105 (1988) (medical review board termination of

competing doctor’s staff privileges) ; California Retail Liquor Deal-

ers Ass’n v. Midcal Aluminum, Inc., 445 U.S. 97, 103 (1980) (price-

fixing) ; Cantor v. Detroit Edison Co., 428 U.S. 579, 581 n.3 (1976)

(tying). The appellate decisions cited by MSL are to the same

effect. See Litton Systems, Inc. v. American Tel. and Tel. Co., 700

F.2d 785, 806-08, 814-16 (2d Cir. 1983) (predatory conduct); Vir-

ginia Academy of Clinical Psychoiogists v. Blue Shield of Va., 624

F.2d 476, 482, 484 (4th Cir. 1980) (concerted refusal to deal).

aT aL Tene

defendant’s arguments that state authorization of the pri-

vate anticompetitive conduct immunized the private actors.

Here, by contrast, it is the application by state supreme

courts of state bar admission rules that caused the alleged

injury about which MSL complains. (See Pet. App. 23A

n.9 (“MSL continues to miss the crucial point that it is

the direct action of the states which causes its injury” ).)

MSL’s arguments that the states have not authorized or

supervised the ABA’s accreditation activities are therefore

beside the point because, as the Court stated in Hoover,

“{wl]here the conduct at issue is in fact that of the state

legislature or supreme court, we need not address the

issues of clear ‘articulation’ and ‘active supervision.’” 466

U.S. at 569. (Accord Pet. App. 21A (“Because the states

are sovereign in imposing the bar admission requirements,

the clear articulation and active supervision requirements

urged by MSL are inapplicable”), 25A n.11 (“MSL seri-

ously misstates the Noerr doctrine” ).)

2. MSL may not recover for an alleged “stigma” or

“loss of prestige” arising from the ABA’s denial of MSL’s

application for accreditation. Because the “stigmatic” in-

jury alleged by MSL is incidental to the ABA’s efforts to

petition the states in connection with bar admission deci-

sions, the court of appeals properly held that MSL’s

“stigma” claim is barred by Noerr.

In Noerr, the Court held that injuries “incidental” to

legitimate efforts to influence government lie outside the

reach of the Sherman Act, even where such efforts were

made as part of a deceptive publicity campaign that had

the purpose and effect of poisoning customer relationships.

365 U.S. at 142-44. The Court explained that it is “in-

evitable” that “an incidental effect” of such a campaign

“may be the infliction of some direct injury upon the

interests of the party against whom the campaign is di-

rected.” Jd. at 143. Allowing plaintiffs to recover for

such injuries would “be tantamount to outlawing all such

campaigns,” a result the Sherman Act was not intended

to achieve. Jd. at 143-44. The Court drew the line at

particularized “attempt[s] to interfere directly with the

business relationships of a competitor,” concluding that

the absence of any evidence “that the railroads attempted

directly to persuade anyone not to deal with the truckers”

was dispositive of the plaintiffs’ antitrust claims. Jd. at

142-44.

That same result follows here a fortiori. The court of

appeals found, on the record before it, that for the past

70 years the ABA has “petitioned the states in a cam-

paign to prohibit graduates from unaccredited schools

from taking bar examinations.” (Pet. App. 6A, 26A-27A.

See C.A. App. 2958, 3618-19.) Indeed, MSL admitted

in both the district court and the court of appeals that the

ABA engaged in petitioning activity. (C.A. App. 128,

134-35, 139 (MSL motion to compel (Mar. 10, 1994));

Brief of MSL at 15-16, 51 (Oct. 21, 1996), Massachu-

setts Sch. of Law at Andover, Inc. v. American Bar Ass’n,

107 F.3d 1026 (3d Cir. 1997) (96-1792).) As part of

this activity, the ABA communicates its accreditation deci-

sions to the states, defends the criteria on which those

decisions are based, and regularly opposes efforts to allow

graduates of law schools not accredited by the ABA to

take the bar examination. (Pet. App. 6A, 27A; C.A. App.

2958, 3618-19, 3623-53.) Moreover, the court of appeals

found that there was no evidence that the ABA had

attempted to persuade anyone not to deal with MSL.

(Pet. App. 27A-28A.) Therefore, the court properly held

that any “stigma” suffered by MSL was purely incidental

to the ABA’s legitimate petitioning activity.

This part of the decision of the court of appeals again

represents a straightforward application of well-settled law.

The decision does not create a conflict with other courts

of appeals; as the court noted here, it is well-established

that “loss of prestige resulting from a refusal to approve

a product or service does not alone make out an antitrust

claim” (Pet. App. 26A).’ Nor did the Department of

Justice disagree with this holding in the court of appeals;

indeed, in its amicus brief filed in the court of appeals, the

Government recognized that “[a]ntitrust defendants are

not liable for any anticompetitive effects of legitimate

petitioning efforts, even if those efforts have an incidental

or derivative effect on private market behavior because,

to construe the Sherman Act otherwise, would unduly chill

important First Amendment activities.” (Gov. Br. at

11-12.)

MSL does not challenge this legal standard, but rather

disagrees with the court’s application of that standard to

the unique facts of this case. Once again, MSL relies

heavily on Allied Tube, which the court of appeals prop-

erly found to be inapposite. In Allied Tube, this Court

concluded that the actions of a group of manufacturers

to exclude the plaintiff competitor's product from the

National Electric Code constituted an anticompetitive

agreement among manufacturers, distributors and con-

sumers not to trade in the plaintiff's product. 486 U.S.

at 507. Cautioning that its holding represented a “close”

question grounded in the specific “context and nature”

of the activity at issue, the Court found that the defend-

ant’s actions constituted “anticompetitive commercial ac-

tivity” that had a market impact independent of any

7 See, e.g., Sanjuan v. American Bd. of Psychiatry & Neurology,

Inc., 40 F.3d 247, 251-52 (7th Cir. 1994) (rejecting antitrust claim

for damages caused by defendant’s failure to certify plaintiff doc-

tors), cert. denied, 116 S. Ct. 1044 (1996); Schachar v. American

Academy of Ophthalmology, Inc., 870 F.2d 397, 399 (7th Cir.

1989) (rejecting antitrust claim for damages caused by the de-

fendant’s failure to approve plaintiffs’ medical procedure) ; Consoli-

dated Metal Prods., Inc. v. American Petroleum Inst., 846 F.2d 284,

293 (5th Cir. 1988) (rejecting antitrust claim for damages caused

by trade association’s unjustified denial of request for product

certification). See also Sessions Tank, 17 F.3d at 299 (stating anti-

trust immunity attached to alleged injury incidental to valid peti-

tioning activity).

petitioning activity and was therefore not immune under

Noerr. Id. at 507 & n.10.

By contrast, MSL’s alleged injury arose from the ABA’s

communication of its accreditation decisions to the states

and the public, which is precisely the speech protected

under Noerr. Based on the factual record before it, the

court of appeals distinguished Allied Tube, finding that

there was no evidence that the ABA had attempted to

interfere with MSL’s commercial relationships and con-

cluding that the ABA’s communication of its accredita-

tion decisions was not “commercial activity” and did not

involve an anticompetitive restraint of trade. (Pet. App.

25A-26A.) MSL’s disagreement with the factual determi-

nations of the court of appeals provides no basis for review

by this Court.

3. The court of appeals properly affirmed the trial

court’s dismissal of MSL’s claims that it suffered direct

injury caused by the ABA’s accreditation standards relat-

ing to faculty salaries, the acceptance of transfer credits

earned at law schools not accredited by the ABA, and

the admission into post-J.D. programs of graduates of

unaccredited law schools. Contrary to MSL’s hyperbolic

assertions, however, the decision of the court of appeals

was based, not on a “sweeping new antitrust immunity for

price fixing agreements, boycotts and other anticompeti-

tive actions” (see Pet. 13, 15, 22, 26, 29), but rather on

the court’s conclusion that MSL had failed to come for-

ward with evidence to raise a genuine issue of material

fact that it had been injured by those accreditation

standards (Pet. App. 28A-33A).

MSL’s assertion that the court’s decision “amounts, for

practical purposes, to virtual per se immunity” for the

ABA (Pet. 15 (original emphasis) ), is refuted by the

plain language of the court’s opinion. Indeed, the court

of appeals explicitly recognized that, “[a]lthough the ABA

is immune from liability attributable to the state action in

requiring applicants for the bar examination to have

graduated from an ABA-accredited law school and from

any stigma injury resulting from the denial of accredita-

tion under the Noerr petitioning doctrine, the ABA is not

immune in the actual enforcement of its standards.” (Pet.

App. 28A-29A.)

Both the district court and the court of appeals simply

found that there was no evidence to support MSL’s asser-

tions of injury. (Pet. App. 29A-33A, 51A n.36, 62A

n.46.) First, the court of appeals found that the ABA

did not base its denial of MSL’s application for accredita-

tion on the level of faculty salaries paid by MSL. (Pet.

App. 29A.)*° Second, relying on MSL’s own admissions,

the court found that MSL had not raised its faculty

salaries in an attempt to comply with the ABA’s accredita-

tion standards. (Jd. at 30A-31A.) Third, the court found

that the ABA’s accreditation standards had not raised

salary levels in the market from which MSL hired its

faculty. (Jd. at 31A-33A.) Finally, the court found that

MSL had not suffered any injury as a result of an alleged

boycott by the ABA. (Jd. at 33A & n.18.) MSL’s dis-

agreement with the factual determinations of the court of

appeals and the trial court, based in large part on MSL’s

own admissions (see, e.g., id. at 30A-31A, 33A n.18),

does not provide a basis for granting its petition.°

8 MSL’s assertion that the decision of the court of appeals leaves

the ABA free to fix the level of salaries paid to law faculty (see,

e.g., Pet. i, 16 n.10) is simply wrong. In February 1995, the ABA

’ rescinded its accreditation standards that addressed faculty salaries

and subsequently agreed, in a consent decree entered into with the

Department of Justice, that it would not adopt standards relating to

faculty salaries for a period of 10 years. United States v. American

Bar Ass’n, 934 F. Supp. 435, 436 (D.D.C. 1996).

®In support of its position, MSL repeatedly refers and cites to

allegations made by the Department of Justice in its litigation with

the ABA. (See, e.g., Pet. 2-9, 11-12, 14-15.) As the court of appeals

observed, MSL’s reliance on such allegations is misplaced because

the Government has never alleged—in that litigation or in the court

of appeals—that MSL was injured by the ABA’s actions and be-

cause the Government’s allegations were never proven and thus

4. MSL’s remaining allegations are inherently un-

worthy of review by this Court. First, MSL was allowed

broad discovery relating to the grounds on which the dis-

trict court entered summary judgment. Indeed, under the

district court’s discovery rulings, see, e.g., Massachusetts

Sch. of Law at Andover, Inc. v. American Bar Ass’n,

853 F. Supp. 837 (E.D. Pa. 1994), MSL took 32 deposi-

tions and defendants produced over 70,000 pages of docu-

ments, including all documents relating to the ABA’s

consideration and denial of MSL’s application for accredi-

tation. Massachusetts Sch. of Law at Andover, Inc. v.

American Bar Ass'n, No. 93-6206 at 2 (E.D. Pa. July 29,

1996). MSL’s assertion that “the district judge ruled the

ABA had not fixed salaries” and used this ruling to cur-

tail discovery (Pet. 8-9) misrepresents the district court’s

discovery rulings, as the court of appeals itself noted (Pet.

App. 14A-15A).

Similarly, contrary to its assertions (Pet. 5, 28), MSL

had the full opportunity to take discovery relating to the

ABA’s Noerr defense and MSL’s state-action arguments,

see Massachusetts Sch. of Law at Andover, Inc. v. Ameri-

can Bar Ass’n, No. 93-6206, slip op. (E.D. Pa. May 16,

1996) (granting MSL motion to compel), but completely

failed to do so—as the district court itself pointed out,

Massachusetts Sch. of Law at Andover, Inc. v. American

Bar Ass’n, No. 93-6206, slip op. at 2-3 (July 29, 1996).

To the extent MSL complains of needing additional dis-

covery in an attempt to deconstruct state bar admission

decisions to determine the impact of ABA accreditation

opinions, such an “inquiry runs afoul of the principles

guiding the Parker and Noerr doctrines.” Sessions Tank,

17 F.3d at 300. See also Omni Outdoor Advertising, 499

cannot be taken as true. (Pet. App. 33A n.19.) Accord United

States v. Microsoft Corp., 56 F.3d 1448, 1460-61 (D.C. Cir. 1995).

See also 15 U.S.C. § 16(h) (consent decree proceedings “shall not be

admissible against any defendant in any action or proceeding

brought by any other party against such defendant under the anti-

trust laws’’).

U.S. at 377-79, 383 (rejecting “any interpretation of the

Sherman Act that would allow plaintiffs to look behind

the actions of state sovereigns”); Hoover, 466 U.S. at

579-80 & n.34 (rejecting attempt to “look behind” state

bar admission decisions).

Finally, MSL’s suggestion that it was somehow prej-

udiced by the district court’s order partially disqualifying

three MSL faculty members from performing certain func-

tions as counsel (Pet. 9, 28) is frivolous. First, MSL did

not allege in the court of appeals that it received incom-

petent counsel. (Pet. App. 42A.) Second, MSL did in

fact retain experienced antitrust counsel.” Third, the dis-

trict court’s order was limited in scope and prohibited the

relevant individuals only from acting as trial counsel, giv-

ing oral argument and deposing witnesses; the district

court did not prohibit these individuals from engaging in

legal research, formulating discovery, writing briefs, or

otherwise using their antitrust expertise on petitioner’s

behalf. Massachusetts Sch. of Law at Andover, Inc. v.

American Bar Ass'n, No. 93-6206, slip op. (E.D. Pa.

Mar. 17, 1994).

10 As the district court noted, “[t]he complaint was signed by

Harold Kohn, one of America’s premier antitrust litigators whose

experience includes arguing the seminal antitrust case of [Noerr].”

Massachusetts Sch. of Law at Andover, Inc. v. American Bar Ass’n,

No. 93-6206, slip op. at 1 (E.D. Pa. July 29, 1996). In total, MSL

retained seven different firms at various times in the courts below.

a ee

CONCLUSION

For the foregoing reasons, the petition for a writ of

certiorari should be denied.

Respectfully submitted,