United States District Court, Northern District of Illinois, E.D
September 14, 1972
J.W.T., INCORPORATED, PLAINTIFF,
JOSEPH E. SEAGRAM & SONS, INC., ET AL., DEFENDANTS.
The opinion of the court was delivered by: McLAREN, District Judge.
MEMORANDUM OPINION AND ORDER
This matter arises on the motions of certain Seagram defendants
to dismiss. The motions are granted.
J.W.T. has sued Joseph E. Seagram & Sons, Inc., nine of its
unincorporated sales divisions, the House of Seagram, Inc.
(hereinafter the "suppliers"), seven distributors of Seagram's
products (hereinafter the "distributors") and eleven of the
suppliers' officers (hereinafter the "individual defendants") for
alleged violations of Sections 1 and 2 of the Sherman Antitrust
Act, 15 U.S.C. § 1, 2. Specifically, J.W.T. claims that the
suppliers fixed prices on alcoholic beverages sold to the
distributors, and that the suppliers and distributors fixed
prices on alcoholic beverages sold to retailers.
Defendant House of Seagram, Inc. moves to dismiss on the ground
that it was merged into Joseph E. Seagram & Sons, Inc. more than
two years before this suit was brought and plaintiff's cause of
action against it was extinguished by Ill.Rev.Stat. ch. 32, §§
157.94, 157.103. Under Illinois law, J.W.T.'s claim is against
the surviving corporation; the complaint therefore will be
dismissed as to House of Seagram, Inc. Ill.Rev.Stat. ch. 32, §§
Seagram's nine unincorporated sales divisions (hereinafter the
"divisions") move to dismiss on the ground that such
intra-corporate entities do not have the capacity to contract,
combine or conspire under the antitrust laws. In the absence of
false representations of independence of, and competition among,
sister subsidiaries, intra-corporate conspiracy theories
generally have been rejected by the courts. Cliff Food Stores,
Inc. v. Kroger, Inc., 417 F.2d 203, 206 (5th Cir. 1969); Joseph
E. Seagrams & Sons, Inc. v. Hawaiian Oke & Liquors, Ltd.,
416 F.2d 71, 82-84 (9th Cir. 1969), cert. denied, 396 U.S. 1062, 90
S.Ct. 752, 24 L.Ed.2d 755 (1970). This Court sees no basis for a
departure from the general rule in the case of the Seagram
divisions here, and they will be dismissed.
The individual defendants have moved to quash service and to
dismiss for lack of personal jurisdiction and improper venue or,
in the alternative, for failure to state a claim. Since the Court
finds venue to be improper, defendants' other grounds will not be
J.W.T. does not predicate venue on the venue provision of the
Clayton Act, 15 U.S.C. § 15, but rather upon the general venue
statute, 28 U.S.C. § 1391(b). J.W.T. argues that venue is proper
under Section 1391(b) because
the claim arose here, relying upon ABC Great States, Inc. v.
Globe Ticket Co., 310 F. Supp. 739 (N.D.Ill. 1970). However, that
case does not help plaintiff; it holds that venue as to each
defendant must be established independently. Id. at 743. J.W.T.
has made no such showing. The complaint alleges concerted action
among the suppliers and distributors, but it alleges no acts or
courses of conduct by the individual defendants in this district.
Therefore, the complaint must be dismissed as to them.
The complaint will be dismissed with prejudice as to House of
Seagram, Inc. and its individual divisions, and without prejudice
as to the individual defendants. Plaintiff may amend its
complaint to revive its claim against the individual defendants
if the requisite contacts with this district are found through
discovery or otherwise.
It is so ordered.
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