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HAYDEN PUBL. CO. v. COX BROADCASTING CORP.

May 20, 1983

Hayden Publishing Co., Inc., Plaintiff
v.
Cox Broadcasting Corp. and United Technical Publication, Inc., Defendants


Costantino, D.J.


The opinion of the court was delivered by: COSTANTINO

Memorandum of Decision and Order

COSTANTINO, D.J.:

 In the above-entitled antitrust action, defendants have moved for summary judgment pursuant to Rule 56 of the Fed. R. Civ. P. In addition to opposing the motion, plaintiff has cross-moved for partial summary judgment. For the reasons set forth below, defendants' motion for summary judgment on all causes of action is hereby granted in its entirety. *fn1"

 Plaintiff Hayden Publishing Company ("Hayden") commenced this antitrust action charging both defendants Cox Broadcasting Corporation ("Cox") and United Technical Publications, Inc. ("UTP"), a wholly-owned subsidiary of Cox, with violating Section 1 of the Sherman Act, 15 U.S.C. § 1, and charging defendant UTP with violating Section 2. 15 U.S.C. § 2. The Section 1 claim charges that both defendants conspired in an unlawful combination and in unreasonable restraint of trade and commerce in advertising in electronic catalog directories. The Section 2 claim alleges that UTP's electronic trade reference publication, "Electronic Engineers Master" ("EEM"), has monopolized or attempted to monopolize the market for product data advertising in electronic catalog directories.

 Defendants' summary judgment motion is premised upon the allegation that the plaintiff's Sherman Act causes of action are dependent upon a showing that Hayden's publication ("Gold Book") and EEM, comprise the entire "relevant product market" for sales of advertising for the electronics trade. Defendants argue that this narrow product market conflicts with commercial reality by excluding actual competitors of both publications. Accordingly, defendants contend that plaintiffs' causes of action must fail as a matter of law.

 Summary Judgment

 This court is ever mindful that "summary [judgment] procedures should be used sparingly in complex antitrust litigation where motive and intent play leading roles . . . ." Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 7 L. Ed. 2d 458, 82 S. Ct. 486 (1962); see Aladdin Oil Co. v. Texaco, Inc., 603 F.2d 1107, 1110 (5th Cir. 1979). In the "proper circumstances" however, where plaintiffs have been afforded ample opportunity for discovery, it is clear that summary judgment does apply to antitrust suits. See McDaniel v. General Motors Corp., 480 F. Supp. 666, 669-670 (E.D.N.Y. 1979), aff'd, 628 F.2d 1345 (2d Cir. 1980). While an antitrust case ripe with issues of fact concerning motive, intent and credibility would seemingly be impervious to Rule 56 application, see generally Moore's Federal Practice and Procedure §§ 56.17[1],.17[5], the mere fact that a case is based upon the antitrust laws does not suspend utilization of the rule. Aladdin Oil Co. v. Texaco, Inc., 603 F.2d at 1111; McDaniel v. General Motors Corp., 480 F. Supp. at 670.

 Summary judgment is appropriate where, as here, there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. See Northrop Corp. v. McDonnel Douglas Corp., 700 F.2d 506, 525 (9th Cir. 1983). A party opposing summary judgment must present "significant probative evidence tending to support the complaint," First National Bank v. Cities Service, 391 U.S. 253, 290, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968); General Business Systems v. North Am. Philips Corp., 699 F.2d 965, 971 (9th Cir. 1983) setting forth "concrete particulars." Dressler v. The MV Sandpiper, 331 F.2d 130, 133 (2d Cir. 1964).

 In the instant action, the court has drawn the facts of the case from the voluminous discovery record, including extensive affidavits submitted by the parties. Wherever reasonable inference can be drawn regarding the evidence, the court has taken that inference most favorable to the plaintiff. See Reisner v. General Motors Corp., 671 F.2d 91, 93 (2d Cir.), cert. denied, 459 U.S. 858, 103 S. Ct. 56, 74 L. Ed. 2d 112 (1982). With these principles in mind, the court has determined that summary judgment is appropriate. The matter has been sufficiently developed with extensive discovery proceedings. As the movants have carried their burden of demonstrating that there are no genuine issues of material fact concerning resolution of these claims, they are ripe for decision in defendants' favor.

 Section 2 Monopolization Claim

 In order to state a valid claim of monopolization under § 2, *fn2" a plaintiff must allege that the defendant possesses monopoly power in the relevant market and has willfully acquired or maintained this power, as distinguished from enjoying it solely as a consequence of superior product, growth, development or historic accident. United States v. Grinnell Corp., 384 U.S. 563, 570-71, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966); Schaben v. Samuel Moore & Co., 462 F. Supp. 1321 (S.D. Iowa 1978), aff'd, 606 F.2d 831 (8th Cir. 1979). Monopoly power is the power to control prices or to exclude competition within the relevant market. United States v. Grinnell Corp., 384 U.S. at 570-71; ALW, Inc. v. United Air Lines, 510 F.2d 52, 55 (9th Cir. 1975).

 The initial requirement, that a defendant possess monopoly power in the relevant market, compels a determination as to the definition and extent of that relevant market. Indeed, an antitrust plaintiff cannot prove a defendant's ability to monopolize trade absent a showing that the defendant is able to do so within the relevant economic market. See Nifty Foods Corp. v. Great Atlantic & Pac. Tea Co., 614 F.2d 832, 840 (2d Cir. 1980) (" Nifty Foods "); FLM Collision Parts, Inc. v. Ford Motor Co., 543 F.2d 1019, 1030 (2d Cir. 1976), cert. denied, 429 U.S. 1097, 51 L. Ed. 2d 545, 97 S. Ct. 1116 (1977). Thus, illegal monopoly power may only be appraised in terms of the competitive market for the product. United States v. E.I. duPont de Nemours & Co., 351 U.S. 377, 393, 100 L. Ed. 1264, 76 S. Ct. 994 (1956) (" duPont "); see Nifty Foods, at 840; Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 272 (2d Cir. 1979), cert. denied, 444 U.S. 1093, 62 L. Ed. 2d 783, 100 S. Ct. 1061 (1980). Moreover, courts are not free to accept whatever market is suggested by the plaintiff, but must examine commercial realities within the industry in question, JBL Enterprises, Inc. v. Jhirmack Enterprises, Inc., 698 F.2d 1011, 1016 (9th Cir. 1983) so as to determine whether plaintiff has met the burden of proving the relevant market. Acme Precision Products, Inc. v. American Alloys Corp., 484 F.2d 1237 (8th Cir. 1973); see duPont, 351 U.S. at 381. In so doing, this court recognizes that "the antitrust laws . . . were enacted for the protection of competition, not competitors." Gianna Enterprises v. Miss World (Jersey) Ltd., 551 F. Supp. 1348, 1353 (S.D.N.Y. 1982) (emphasis in original) (quoting Brown Shoe Co. v. United States, 370 U.S. 294, 320, 8 L. Ed. 2d 510, 82 S. Ct. 1502 (1962) (" Brown Shoe ").

 While determination of the relevant market is essentially a question of fact, see, e.g., United States v. Grinnell Corp., 384 U.S. 563, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966); International Boxing Club v. United States, 358 U.S. 242, 3 L. Ed. 2d 270, 79 S. Ct. 245 (1959), there are specific legal guidelines which are applicable to all cases.

 In defining the "relevant product market," the Supreme Court in duPont, determined that the market is composed of products that have "reasonable interchangeability" for purposes for which they are produced. 351 U.S. at 395. It is, therefore, the use of the product by consumers rather than the nature of the product itself, which determines the relevant product market. Warner Amex Cable v. American Broadcasting, 499 F. Supp. 537, 546 (S.D. Ohio 1980); United States v. Chas. Pfizer & Co., 245 F. Supp. 737 (E.D.N.Y. 1965).

 The Relevant Product Market

 In support of its summary judgment motion, defendants argue that in addition to EEM and Gold Book, there are a number of other publications which compete within the relevant product market. Both EEM and Gold Book are published annually and derive revenue through the sale of advertising space to suppliers of electronic products. The advertisements are then published within each publication and distributed without charge to the electronics trade. The product market, which Hayden's Section 2 claim alleges has been monopolized, consists of that market which competes for the sale of advertising.

 Defendants have published EEM since 1958 while Gold Book entered the market in 1974. Defendants have asserted that the following publications compete with EEM ...


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